Three legislative sessions and the future of Arkansas children

Editor’s note: Rich Huddleston is the executive director of Arkansas Advocates for Children and Families. Opinions, commentary and other essays posted in this space are wholly the view of the author(s). They may not represent the opinion of the owners of Talk Business & Politics.

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During three legislative sessions that will be held in the coming months, Governor Hutchinson and the Arkansas General Assembly will make critical decisions about the future of the state budget. These decisions will have major consequences for the future of Arkansas’s children.

Let’s start with the special session on health care. One of the big issues during the session will be whether to keep Arkansas’s Medicaid expansion, currently known as the Private Option, which now provides health care coverage to over 250,000 low-income adults. Governor Hutchinson has proposed replacing the Private Option with Arkansas Works. While some important changes have been proposed (the subject of a future analysis by my organization), the big decisions will be about whether to keep the expansion and the state’s plan for containing future Medicaid costs.

The pros and cons of keeping the expansion have been widely debated, so I won’t repeat all of it here. But I will say this: If we don’t keep it, there is no denying it would have major consequences for the state’s low-income families and children. It would mean, of course, that over 250,000 low-income adults would lose health care coverage. That alone would be catastrophic. But the lack of affordable coverage would also mean that families would have less money to spend on other basic needs for their children, such as clothing, food, housing, etc. In the long run, it also would result in fewer children being covered through a different program, ARKids First. Why? We know that when many parents got coverage for the first time through the Private Option, they also signed up their children for ARKids First. Arkansas has reduced its rate of uninsured children to only five percent, a milestone in our state’s history.

Failure to adopt some version of Arkansas Works would create havoc for the state budget during the fiscal session. Experts say failure to adopt Arkansas Works, and pass the companion budget bill during the fiscal session, would create a new $100-$120 million hole in the fiscal 2017 budget which starts July 1. That would mean additional cuts in programs important to children and families. Governor Hutchinson has already admitted as much, and legislative leaders are developing contingency plans for huge across-the-board cuts (except for state funding to public schools) that could total as much as six percent.

These cuts would come on top of the 2013 and 2015 tax cuts that reduced state revenues by $242 million – revenues that otherwise would have been available for the fiscal 2017 budget. The tax cuts worsened major funding gaps in programs critical to vulnerable children and families, including funding needed to maintain the quality of Arkansas’s highly regarded pre-K program; a child welfare system for abused and neglected children already wilting because of high caseloads; and reforming a juvenile justice system that incarcerates too many low- and medium-risk kids instead of serving them in more effective community-based programs. These are in addition to other unfunded initiatives that we know could improve the well-being of our most vulnerable children, such as after-school and summer programs to reduce summer learning loss for low-income kids, a state earned income tax credit (EITC) to improve their economic well-being, and paid family leave to improve the care and development of our youngest kids.

A third session on funding for highways and roads also looms large for children and families, and many of the proposals floated so far don’t look good for them. Some of the more troublesome proposals include: reallocating future general revenue growth away from already-strapped services for children and families to highways and roads, stopping a planned grocery tax cut that would benefit low- and middle-income families the most, and relying on future budget surpluses that would almost certainly be inadequate to meet the needs of highways and roads.

A more sensible proposal would be to modernize the state’s gas tax by increasing it a modest 2.5 cents per gallon and indexing it to future inflation and improvements in fuel efficiency. That would raise significant funding for highways. We could even give part of the new revenues back in tax relief through a state EITC for low-income families, the only group left out of the 2015 tax cuts.

The state budget is a moral document. The decisions our Governor and our legislature make about how to spend our limited resources reflect our values and priorities. In a state that ranks 44th in child well-being and where one in four children live in poverty (closer to one in two for minority children), Arkansas children must be our highest priority in the state budget. It’s time our state leaders make them our highest priority, too.