Gov. Asa Hutchinson said recently that passage of a proposed constitutional amendment to make permanent an existing sales tax for roads and highways is his top campaign priority for this year.
At a kickoff event conducted by the “Vote for Roads. Vote for Issue 1” committee in November, Hutchinson said he believed that the campaign to seek voter approval of Issue 1 will be the most important issue on the ballot in 2020.
Hutchinson, who is term-limited and will leave office at the end of 2022, said nothing will distract him from the effort because he believes approval of the measure is critical to the future of the state.
He is framing the issue as a way to continue funding for state highways, roads and bridges without raising taxes. The half-percent sales tax was approved by the voters in November of 2012 and was set to expire after 10 years. Voters wouldn’t be approving a new tax if they say yes to Issue 1. They would, however, be able to have a half-cent off the sales tax rate if they said no to the ballot measure.
A poll conducted in October by the Gilmore Strategy Group showed that 63% of Arkansans surveyed either will vote for or will probably vote for Issue 1, the governor said. Those numbers indicate the voters understand the need but at the same time demonstrate that a campaign is necessary to turn the “probably will vote for” into “will vote for” before November, he said.
The Arkansas State Chamber of Commerce, the Arkansas Trucking Association, the Arkansas Poultry Federation, the Farm Bureau, the Associated General Contractors and the Associated Builders and Contractors are among the groups whose representatives are members of the “Vote for Roads. Vote for Issue 1” committee. Hutchinson said it will take a minimum of $2.5 million to run an effective campaign and that he’s looking at citizens who believe in roads to help fund that campaign.
State transportation officials have said they believe the half-cent sales tax, if extended, would raise about $205 million a year for highways and about $43 million each for cities and counties. Voter approval would provide funding for miles of interstate highways and farm-to-market roads as well as money for replacing deteriorating bridges, the governor said. Certainly few motorists would disagree that many bridges in the state are deteriorating.
Without continuation of the sales tax, Hutchinson said, cities and counties would lose millions of dollars that are in their current street and road budgets. It would seem the loss of those state funds would be a body blow to local governments’ efforts to keep their roads in passable condition. It also seems unlikely that locally elected leaders could persuade their constituents to replace $86 million in lost state tax money with local taxes.
The late Neil Stallings, mayor of Jonesboro for a number of years, often told constituents that “If you like what you’re getting” in terms of municipal services, then continue to support the elected leadership of the community.
That seems to be the same kind of message that those supporting Issue 1 will try to get voters statewide to receive.
The 2020 ballot issue, referred to the electorate by the General Assembly, represents the second part of Hutchinson’s $300 million highway plan.
Legislators enacted the first part, which became Act 416 in 2019. That act placed a wholesale sales tax on fuel that increased the excise tax on gasoline by three cents and the excise of diesel fuel by six cents. It went into effect Oct. 1 of last year, but with retail gasoline prices considerably under $3 per gallon, it seems motorists did less grumbling than they might have otherwise.
Act 416 raised significantly the registration fees for electric cars by $200 annually and by $100 for hybrids. It diverts casino tax revenue over $31.2 million to the Arkansas Department of Transportation and guarantees the department a minimum of $35 million from casino revenues and other sources. State officials project that Act 416 will add about $95 million a year for ARDOT and approximately $13 million for cities and counties.
The Americans for Prosperity group is said to be considering forming or supporting others who are interested in organizing a ballot committee to oppose Issue 1. It will be interesting to see what happens statewide and even more interesting to see how voters in politically conservative Northeast Arkansas cast their ballots.
Hutchinson says he will try to stay out of Republican primary election races, but he has backed incumbent Sen. John Cooper’s bid to retain his District 21 seat in the State Senate against Rep. Dan Sullivan in the March Republican primary. Hutchinson endorsed eight candidates for legislative seats in the 2016 Republican primary and six of them won. He said that’s not something he wants to repeat in 2020.
I expect that for two reasons we’ll be seeing and hearing a lot more from Gov. Hutchinson in our little corner of the state.
Editor’s note: Paul Holmes is editor-at-large for Northeast Arkansas Talk Business & Politics. He can be reached at [email protected]. The opinions expressed are those of the author.