Prosperity group report seeks lower state spending, tax policy changes

The Arkansas Chapter of Americans for Prosperity has released a report that called for reduced state spending and changes in the state’s tax policy.

“This overview isn’t about what we do wrong, but offers ideas being used in other states to rein in government growth. Arkansas families have been tightening their belts and it’s time for state government to follow their example,” said Teresa Crossland-Oelke, state director for Americans for Prosperity.

Roby Brock with TalkBusiness.net, a content partner with The City Wire, summarized the report with this story. He noted that American for Prosperity included some of the points made by the Murphy Commission which released a report on state government about 10 years ago.

Crossland-Oelke said that the state data — much provided by the Arkansas Department of Finance and Administration — was reviewed by CPA Steven J. Anderson, a research fellow at the Oklahoma Council of Public Affairs who also served under former Gov. Frank Keating in the Oklahoma Office of State Finance. Former Murphy Commission member J. French Hill, CEO of Delta Trust and Bank, also reviewed the report.

“All budgets of public and private endeavors require periodic independent review. Such scrutiny often reveals significant opportunities for savings and increased productivity.  I commend Americans for Prosperity for undertaking the hard work of a close review.  Taxpayers deserve it,” Hill said.

Highlights of the report include:
• State government employment grew by 228% from 1965 to 1998. From 1998 to 2007, state government has grown by an additional 171% in one-third of the time. Today, Arkansas government stands as the largest employer in the state, according to AFP.

• Arkansas state government debt has grown, adjusted for inflation, from $887 million in 1980 to $4.3 billion in 2007, a 394% increase.

• The group says the just-released study is part one of a three-part effort to stimulate discussion and propose suggestions to limit state government spending.  The remaining two studies will include a five-year agency-by-agency review of expenditures and a model budget that “puts hard-working Arkansas families” as its top priority.

• The report does offer commentary on initial proposals for state policy makers to pursue. Specifically, it calls for: Spending constraints tied to inflation and population growth; a freeze on any payback on borrowed funds for unemployment benefits from the federal government; a hiring freeze on state government employees and possible workforce reduction through early retirement incentives and attrition; and moving some state government functions to rural areas of the state to capitalize on empty buildings, lower cost of living, and dwindling job opportunities for rural citizens.

“This overview isn’t about what we do wrong, but offers ideas being used in other states to rein in government growth.  Arkansas families have been tightening their belts and it’s time for state government to follow their example,” said Teresa Crossland-Oelke, State Director for Americans for Prosperity.

Brock noted that the report “will certainly field critics who will argue that it is not an impartial analysis of potential policy changes. Some of the group’s proposals lack details or lack consideration of all factors involved in the policy changes. Progressive and left-of-center advocates will be opposed to the tax-cutting proposals suggested by the report.”