The fiscal session turns 10

For Arkansas history trivia fans, what significant legislative event began 10 years ago?

If you said the Arkansas fiscal session, you are correct.

For those who may have forgotten, the fiscal session is the byproduct of House Joint Resolution 1004 of 2007 (HJR 1004), with lead sponsorship by Rep. Eric Harris and Senator Bill Pritchard. HJR 1004, a legislatively referred constitutional amendment, appropriately named the Arkansas Legislative Session Amendment, or Proposed Amendment 2, was on the ballot on November 4, 2008.

Proposed Amendment 2 passed with almost 70% of the vote, becoming Amendment 86 of the Arkansas Constitution (Amendment 86).

Amendment 86’s premise was that, because the national or state economy can change quickly and the state budget was set for two years, the fiscal session would allow for greater legislative oversight and the ability to make necessary budget changes.

The fiscal session is focused on appropriations for the “big six” state departments, which include the budgets pertaining to public education, higher education, health, human services, and corrections.

The first fiscal session was February 8, 2010 through March 4, 2010, and traditionally, the fiscal session would begin right about now on February 10th. However, Amendment 86 authorized the General Assembly to shift the beginning date of the fiscal session. With party primaries, including the presidential primaries, occurring on March 3, 2020, the 2020 fiscal session will begin on April 8, 2020.

DATES AND DEADLINES
The 2020 pre-fiscal session budget hearings begin on March 4, 2020. The Joint Budget Committee (JBC) agenda will primarily focus on the presentation of the Executive Balanced Budget for Fiscal Year 2021. In addition, the JBC will hear budget requests for the Institutions of Higher Education, the Department of Corrections, the Department of Education’s Public Education Fund, the Department of Health, the Department of Public Safety, and, the Department of Human Services.

On March 9, 2020, pre-filing of appropriation bills begins. April 8th is the first day of the 2020 fiscal session as well as the deadline for filing identical resolutions for non-appropriation bills.

There is a major obstacle to non-appropriation bills being considered. As the fiscal session is intended for appropriation bills, a two-thirds vote is required by the General Assembly for consideration of the non-appropriation resolutions. It should be noted that the deadline for filing legislation associated with the identical resolutions is April 22, 2020.

April 22, 2020, the fifteenth (15th) day of the fiscal session, is also the filing deadline for appropriations bills. It can be extended, but it can be challenging, as a two-thirds vote of the General Assembly is required for that also.

Amendment 86 sets forth the duration of fiscal sessions — up to 30 days with one exception. For the 2020 fiscal session, the conclusion should be no later than May 7, 2020, unless it is extended. Amendment 86 allows for a one-time extension of a fiscal session for up to thirty (30) calendar days. This does require a three-fourths vote of the General Assembly, which limits expansive fiscal sessions.

Therefore, the 2020 fiscal session should end no later than May 22, 2020.

WHAT TO EXPECT IN THE 2020 FISCAL SESSION
Medicaid expenditures and expansion, through the Private Option and then Arkansas Works, have monopolized previous fiscal sessions. With the work provision of the fittingly named Arkansas Works in limbo in the federal appellate courts, the Medicaid budget may or may not be the hot issue.

That said, the best bet is that, after substantial tax cuts during the 2015-2019 regular legislative sessions, but with an ample surplus, there will be competing demands for increasing budgets versus creating reserves for future tax cuts or exemptions.

While non-appropriation legislation is infrequent during fiscal sessions, businesses should be aware that there can be major implications during a fiscal session, as budgets can be amended or special language included impacting existing programs.

Happy 10th anniversary to the Fiscal Session, however, due to ethics reform, please don’t bring any gifts to the celebration.

Editor’s note: Public affairs firm inVeritas CEO Ruth Whitney and VP of government relations and strategic partnerships Will Gruber are the co-authors of this commentary. The views expressed are those of the authors.