Rep. Joe Jett, chairman of the House Revenue & Tax Committee, says he will propose to a working group a study of using 25% of surplus funds for potential future highway funding.
Jett, who appeared on this week’s edition of Talk Business & Politics, said if the state had dedicated 25% of surplus funds during the past decade for road purposes, it would have accumulated a nearly $500 million revenue stream. The 25% of surplus money to be allocated for highways would only come after all areas of the Revenue Stabilization Act (RSA) are funded, under Jett’s concept.
“This is not a fix, but it’s a start. Basically, what it is, is showing my colleagues that we don’t have to just go out and arbitrarily raise taxes to find money to help the highway program,” Jett said.
A year-over-year look at what 25% of the state’s surplus would provide ranges from $0 in 2009 and 2010 to as much as $102.3 million in 2007. In 2013, 25% of the surplus would have equated to $74.9 million while in 2014 it would have accumulated $19.7 million. All told, the equation would have brought in $478.4 million during the past decade.
State highway officials have delayed or cancelled hundreds of millions of dollars of road projects in Arkansas this year due to federal funding uncertainty. Also, flat gasoline tax revenues have led to declining regular funds for highway construction and repairs for years. Voters did approve a major highway construction program, but those funds are specified for key projects.
Jett said his plan is simply an idea for the conversation, and he said he will ask the recently announced Governor’s Working Group on Highway Funding to add his proposal to the mix for consideration.
When asked if future tax cuts or General Improvement Funds spending might have to be curtailed in order to build a reservoir of potential highway revenue, Jett said, “The alternative is going to be a tax increase (to pay for roads).”
Watch his full interview below.