Budget holds, tax breaks on legislative agenda

In its first full day of committee action, state lawmakers made haste in reviewing — and holding — a multitude of state agency funding requests.

The Joint Budget Committee, which has been reviewing agency budgets in pre-session activity, approved a number of budgets for House members to first consider before they head to the State Senate for approval. Smaller budgets approved today included the Alcohol Beverage Control Board and the Arkansas Racing Commission.

Legislators also have a privilege of putting budgets “on hold.” This allows a House or Senate member to ask for more detail on an agency or office budget request before the full Joint Committee can consider it.

Arkansas lawmakers placed the Attorney General’s office budget on hold, as well as the state Department of Corrections, Highway and Transportation Department,  Department of Career Education, and the Governor’s Mansion.

Rep. Hank Wilkins, D-Pine Bluff, said his Highway Department budget hold centered on a local roads project he claims has received federal funding, but has seen little work.

“What I want to do is find out from the Highway Department why we’re not making reasonable progress,” Wilkins said.

Rep. Andrea Lea, R-Russellville, who placed the hold on Attorney General Dustin McDaniel’s budget, said legal settlement issues were of concern to her.

“I believe further discussion of the AG budget is necessary, especially in light of this last large settlement of mortgages lawsuit. The legislature needs further oversight,” Lea said.

McDaniel’s office recently announced a $39.4 million settlement with 5 of the biggest U.S. banks as part of a larger $26 billion national foreclosure settlement case.

GOVERNOR’S LETTERS
Gov. Mike Beebe (D) has proposed nearly $30.5 million in supplemental appropriations to shore up budget shortfalls for state agencies in the current fiscal year. If approved, the money would be drawn from the state’s $72.2 million surplus.

Beebe’s requests include:
• $10 million for public employees’ merit adjustment fund
• $9 million to the Arkansas Department of Corrections for overtime and holiday pay
• $3.8 million for the State Hospital for compliance and regulations standards
• $2.7 million request for the financially troubled Arkansas Forestry Commission
• $2 million to the Arkansas Department of Corrections for back-pay for state inmates housed in county jails
• $1.8 million to the Arkansas Department of Corrections to reduce case-load assignments
• $1.4 million to the Arkansas Department of Corrections to repair an inmate housing facility on Roosevelt Road in east Little Rock
• $130,000 to replenish the Governor’s Emergency Fund, which has been depleted for several immediate needs
• $110,000 for Drug Court funding
• $35,000 to the Arkansas Parole Board

Joint Budget Committee members approved 3 of the supplemental appropriation requests in motions today that will allow bills to be drawn up for consideration. The 3 bills affected Forestry, Corrections and Parole Board funding.

The Joint Budget Committee will debate the merits of each individual bill in the coming days. The budget panel will also consider additional Governor’s letters in its meeting on Wednesday.

HOUSE RULES COMMITTEE
The House Rules Committee met quickly on Tuesday (Feb. 14) and pushed two key measures to the full House floor for consideration. Several other measures were left on hold.

HCR 1009, which would repeal a tax break for truckers that has not gone into effect, will be considered by the full House body. The proposal was contingent on a diesel fuel tax increase going into law, but the Arkansas Trucking Association backed out of the deal after polling showed the fuel tax increase was unpopular.

The ATA’s board of directors sent a letter of support for the tax repeal effort.  House Rules members quickly approved the repeal measure with little discussion and no on-the-record opposition. Rep. Larry Cowling, D-Foreman, sponsor of the measure said without the diesel tax increase the tax break “could no longer be revenue neutral.”
Arkansas Department of Finance and Administration estimates suggested the tax reduction would eliminate $4 million from the state coffers.

House Rules members also approved HCR 1004 with little debate. The measure is the Joint Budget Committee-approved resolution that will allow for a Revenue Stabilization Act (RSA) to be filed.  The RSA lays out budget priorities for nearly all state agency spending.

An alternative RSA has been proposed by House Republican leadership. Rep. John Burris’, R-Harrison, HCR 1008 was not considered today and he was not present in the meeting.

Speaker of the House Robert Moore, D-Arkansas City, said it would be considered in the future when more details are provided. HCR 1004, which has been reviewed by the Joint Budget Committee, was further along in the process, he said.

HCR 1003 by Rep. James McLean, D-Batesville, was withdrawn. It would reduce elected officials’ mileage reimbursement rates to the same as state employees.