The
legislative session is rapidly winding down. Maybe quicker than anyone
imagined. More than a few people suggested that the General Assembly would
adjourn on April 5, which leaves just two weeks to either consider the
nearly 2,000 bills that remain on the table or disappoint a lot of legislators
who didn’t have a chance to have their bill heard. Of course the General
Assembly won’t consider them all, but they do typically pass around fifty or
sixty percent of introduced bills so that would mean they would need to consider
and approve more than 900 bills before adjourning. No way that happens by April
5.
legislative session is rapidly winding down. Maybe quicker than anyone
imagined. More than a few people suggested that the General Assembly would
adjourn on April 5, which leaves just two weeks to either consider the
nearly 2,000 bills that remain on the table or disappoint a lot of legislators
who didn’t have a chance to have their bill heard. Of course the General
Assembly won’t consider them all, but they do typically pass around fifty or
sixty percent of introduced bills so that would mean they would need to consider
and approve more than 900 bills before adjourning. No way that happens by April
5.
One
of the big stories for the past week was HB1418, which would have phased-in a
transfer of sales taxes from vehicle-related sources (batteries, tires, car
sales) from the state’s general revenue to the Highway Department. As originally conceived the bill would have phased-in a
gradual transfer of this revenue so that in ten years the Highway Department
would have had nearly $400 million per year in additional funding to pay for
maintenance and construction. The Highway Department’s main funding source –
the federal trust fund and state gas taxes – have been flat while the cost of
maintaining and building new highways has skyrocketed. This disparity prompted
the proposal to shift sales taxes to the Highway Department
of the big stories for the past week was HB1418, which would have phased-in a
transfer of sales taxes from vehicle-related sources (batteries, tires, car
sales) from the state’s general revenue to the Highway Department. As originally conceived the bill would have phased-in a
gradual transfer of this revenue so that in ten years the Highway Department
would have had nearly $400 million per year in additional funding to pay for
maintenance and construction. The Highway Department’s main funding source –
the federal trust fund and state gas taxes – have been flat while the cost of
maintaining and building new highways has skyrocketed. This disparity prompted
the proposal to shift sales taxes to the Highway Department
Governor Mike Beebe and the state’s institutions of
higher education led a very spirited opposition to HB1418 because of their fears
that any transfer of general revenue to the highway department would result in
cuts to universities and community colleges. A number of other advocacy groups
joined in the opposition and were able to strip away co-sponsors from the bill.
The bill’s sponsor amended the legislation a number of times to reduce the
potential impact to higher education, but an acceptable compromise could not be
reached. The Transportation Committee heard the legislation on Thursday and the
normally quiet committee was transformed into standing room only as supporters
and opponents took over an hour to argue the merits and drawbacks of the bill.
higher education led a very spirited opposition to HB1418 because of their fears
that any transfer of general revenue to the highway department would result in
cuts to universities and community colleges. A number of other advocacy groups
joined in the opposition and were able to strip away co-sponsors from the bill.
The bill’s sponsor amended the legislation a number of times to reduce the
potential impact to higher education, but an acceptable compromise could not be
reached. The Transportation Committee heard the legislation on Thursday and the
normally quiet committee was transformed into standing room only as supporters
and opponents took over an hour to argue the merits and drawbacks of the bill.
The
bill required 11 votes to pass out of committee and on to full consideration by
the House. After a roll call, the bill garnered ten yes votes – one short and
HB1418 failed to advance.
bill required 11 votes to pass out of committee and on to full consideration by
the House. After a roll call, the bill garnered ten yes votes – one short and
HB1418 failed to advance.
Also
this week, the legislature received a consultant’s report on the viability of
the proposed Big River Steel project. The
House and Senate Agri/Economic Development committees meet on Monday to discuss
the report and make recommendations on incentives. The state is being asked to
issue $125 million in bonds to fund a $50 million loan to Big River Steel and
use the remaining $75 million for site preparation and issuance costs.
The state is also offering various sales tax
exemptions and income tax credits estimated at more than $200
million.
this week, the legislature received a consultant’s report on the viability of
the proposed Big River Steel project. The
House and Senate Agri/Economic Development committees meet on Monday to discuss
the report and make recommendations on incentives. The state is being asked to
issue $125 million in bonds to fund a $50 million loan to Big River Steel and
use the remaining $75 million for site preparation and issuance costs.
The state is also offering various sales tax
exemptions and income tax credits estimated at more than $200
million.
In
return, Big River Steel will build a $1.1 billion steel facility in Osceola that
will employ 525 people at an average wage of $75,000. The success of the
facility depends in large part upon the global demand for steel. The report
projects steel demand will increase by 8.7 million short tons a year and the new
plant has a capacity for more than 3 million short tons or approximately 1/3 of
projected increase in demand.
return, Big River Steel will build a $1.1 billion steel facility in Osceola that
will employ 525 people at an average wage of $75,000. The success of the
facility depends in large part upon the global demand for steel. The report
projects steel demand will increase by 8.7 million short tons a year and the new
plant has a capacity for more than 3 million short tons or approximately 1/3 of
projected increase in demand.
So
how does the state benefit from this investment? The state will collect
additional income taxes from the 525 jobs created, collect sales tax from
purchases made by the plant both during construction and operation and corporate
income taxes from the company itself. The report projects that by investing
$125 million in bonds the state will likely recover their investment plus earn a
return of more than $50 million in sales, corporate and income taxes.
how does the state benefit from this investment? The state will collect
additional income taxes from the 525 jobs created, collect sales tax from
purchases made by the plant both during construction and operation and corporate
income taxes from the company itself. The report projects that by investing
$125 million in bonds the state will likely recover their investment plus earn a
return of more than $50 million in sales, corporate and income taxes.
If
this “modest level of economic benefits,” as the report describes it, is enough
to prompt the state to issue the bonds we shall likely see next week.
this “modest level of economic benefits,” as the report describes it, is enough
to prompt the state to issue the bonds we shall likely see next week.
This
week could also see an announced agreement on tax cuts. Media reports say
that legislative leadership and the Governor’s office are hinting that an
agreement is close on up to $100 million in total tax cuts. With so many tax
cut proposals introduced (in the billions if all were approved) there appear to
be a few that have the most support. The leaders seem to be cuts to grocery,
income and manufacturing-related taxes.
week could also see an announced agreement on tax cuts. Media reports say
that legislative leadership and the Governor’s office are hinting that an
agreement is close on up to $100 million in total tax cuts. With so many tax
cut proposals introduced (in the billions if all were approved) there appear to
be a few that have the most support. The leaders seem to be cuts to grocery,
income and manufacturing-related taxes.
There is so much to be decided between now and the end of
the session. They have to make a decision on Medicaid/insurance expansion for
Arkansans earning 138% or less of federal poverty limits, cobble together a
budget and consider up to three potential constitutional amendments. I can’t
imagine a more frenzied finish to a legislative session than what the 89th is
going to experience.
the session. They have to make a decision on Medicaid/insurance expansion for
Arkansans earning 138% or less of federal poverty limits, cobble together a
budget and consider up to three potential constitutional amendments. I can’t
imagine a more frenzied finish to a legislative session than what the 89th is
going to experience.
If you want to
see a list of committees, their members and pending legislation you can find
that information HERE.
see a list of committees, their members and pending legislation you can find
that information HERE.