Beebe Administration To Fight GOP Bill To Cap Spending Growth

Last Wednesday in our Talk Business Arkansas webcast update, House Majority Leader Rep. Bruce Westerman (R-Hot Springs) said he would soon file a bill to limit the growth of government spending by law.

That bill, HB 1041, was filed and Gov. Mike Beebe's administration appears to be fighting it vigorously.

The bill, which already has 35 House and Senate sponsors, prohibits expenditures from the state’s general treasury from exceeding 3% more than the previous fiscal year’s spending or the average gross domestic product for the preceding three fiscal years, whichever is smaller.

Westerman said, “Had we put this in place 10 years ago, we would have averaged a $250-300 million a year surplus.”

Our content partner, the Arkansas News Bureau, obtained a copy of a Department of Finance and Administration memo already outlining objections.

John Lyon reports:

Westerman said Friday he had expected to face opposition.

“I think it says that they’re not wanting to help control spending, that they’re trying to be business as usual,” he said.

Beebe spokesman Matt DeCample said Friday the governor had seen D&FA’s analysis and also had concerns about the bill.

“We’re still trying to find the reason to have such a law because the Legislature already has the power to control spending as much as they want,” DeCample said.

Some of the concerns outlined in the memo include:

• The bill’s constitutionality
• The potential for cuts to essential services
• Maintaining adequate funding for public schools
• Possible instability surrounding general revenue bonds for major economic projects

You can read more on the story at this link.