Gov. Beebe Proposes $5 Billion Balanced Budget

In what should be his final legislative session, Gov. Mike Beebe proposed a $5 billion budget that includes increased funding for prisons and public schools, projected savings from the private option, and a pay hike for public employees.

Beebe, who is term-limited, will leave office in January 2015.

The fiscal session begins Feb. 10, but state lawmakers have begun the hearing process to review state agency budgets between now and then in an effort to smoothly and efficiently handle their annual budgeting duties. The state’s new fiscal year will begin on July 1, 2014.

Beebe’s budget projects overall revenues of $5.03 billion. It includes:

• A $105.8 million increase in total spending for next year
• $65 million in new funding for public schools
• $10 million for prison funding, which includes $7 million for reimbursements to county jails and $3 million to expand prison beds
• $10 million for the state teachers insurance program, which has had a deficit fixed by lawmakers
• A $5.25 million for a one percent cost-of-living adjustment (COLA) increase for state employees

Beebe’s budget also includes $89 million in savings projected from the private option – the
bipartisan-constructed use of state Medicaid dollars for private health insurance passed by the GOP-controlled Arkansas Legislature and Democratic Gov. Mike Beebe last session.

The private option narrowly passed both chambers of the legislature in 2013. In the fiscal session, some lawmakers have indicated reservations about renewing funding for the health care program.

Benji Hardy, who blogs for the Arkansas Legislative Digest, offered these observations and quotes from officials on the budget proceedings.