Leaders Lay Out Surplus Spending Priorities

Wednesday’s release of state year-end tax collections brought Arkansas’ two-year budget surplus to $174 million and it could grow as interest is earned between now and the 2015 legislative session when lawmakers and the next Governor determine how to spend it.

Talk Business & Politics solicited comments from the legislative leaders who are expected to be in charge during the 90th General Assembly and the two major party candidates for Governor.

State Senator Jonathan Dismang (R-Beebe), President Pro Temp-elect:

There will plenty of discussion in 2015 about the surplus, needs, and wants and every member will have a different definition for priority.

At this point, I’m more concerned with where the dollars shouldn’t go. The surplus should be recognized as one-time money and despite the temptation, shouldn’t be used to create projects or programs that will obligate future Arkansas tax dollars.

Personally, I believe that there are several areas we need to focus, which include prison overcrowding, the condition of our human development centers, and maintaining a healthy balance in the state’s rainy day fund.

State Representative Jeremy Gillam (R-Judsonia), Speaker of the House-designate:

At this point I believe that we need to be cautious about spending this money. There are plenty of needs out there to be sure, but I don’t want to rush to judgment on what should be a priority just yet. We have infrastructure needs, corrections needs, workforce training needs and many others to examine before we make any judgments on what direction to take. There is also nothing wrong with saving the money and not spending it.

Mike Ross, Democratic nominee for Arkansas Governor:

First and foremost, I commend Governor Beebe on his leadership in steering our state through a major economic recession and keeping Arkansas financially sound. He also did this while working to nearly eliminate the sales tax on groceries in a gradual, responsible way – an approach my opponent, Congressman Hutchinson, called an ‘empty promise’ back in 2006. These are the same misguided attacks Congressman Hutchinson is launching against my comprehensive tax cut plan today.

This year’s surplus shows that our economy is growing, and so I would work with the state legislature to use this economic growth to begin gradually implementing my ‘Lower, Fairer Tax Cut Plan,’ which cuts taxes for working families, small businesses and manufacturers in Arkansas – by as much as $665 a year for the average working family. I would also use this growth to gradually increase access to quality pre-kindergarten education in Arkansas so that pre-k will be available to every 4-year-old whose family wants it.

One of my top priorities for the surplus funds will be to work with the legislature to fully fund the Governor’s Quick Action Closing Fund – a critical job creation tool for Arkansas that my opponent, Congressman Hutchinson, once called a ‘slush fund.’ I would also use the surplus funds to help meet our parole and probation officer needs, help ease prison overcrowding, and help protect and stabilize public school employees’ health insurance. I would also use the funds to begin implementing parts of my Jobs First economic development plan, such as more investments in workforce training, more support for innovation in our public schools (Innovation Laboratory), and more resources for our state’s budding entrepreneurs and small businesses (SEED grant program).

Finally, I would listen to and work with Republicans and Democrats in the state legislature to implement these proposals and find other ways we can responsibly use surplus funds to make Arkansas an even better place to live, work and raise a family – all while ensuring we have an adequate rainy day fund to prepare for unforeseen events.

Asa Hutchinson, Republican nominee for Arkansas Governor:

The amount of the accumulated surplus is consistent with my jobs plan to lower the state income tax rate starting with middle income Arkansans. The balance of the surplus will be needed to fund our public safety requirements and other pressing needs that will need to be funded, including our state’s existing pre-k program for those under 200% of the federal poverty level.