ALC-PEER

All right, members, we're fixing to start. If you'll take your seats. With that, I'm going to call the meeting to order. Thank you. Thank you everyone for coming. Appreciate you being here. Uh, we don't have a real long agenda, so let's hope this rolls pretty quick. And with that, um, we're going to start with Adams and A B. Thank you. Thank you, Madam Chair. We're in the first section, section B. These are various temporary appropriation requests. The first item is a letter from the Department of Transformation and Shared Services is for $125,000 spending authority. This is to purchase a box truck for the marketing and redistribution warehouse. It's supported by sales of surplus state property. Uh, staff learned there is currently a backlog of pickups across the state, and the agency has resorted to renting a U-Haul. Next item B2 is a letter from the Department of Veterans Affairs. It's for 60,000 spending authority. This is to provide living expenses for minor children of honorably discharged veterans who are medically incapacitated or deceased. Uh, the letter says appropriation for salary match will be blocked to offset expenses. This item is supported by general revenue. Next item, the last item is a letter from DFA dispersing dispersing officers for 7 million in appropriation. Uh, this is to license software for driver services. It supports physical and mobile driver's licenses and ID cards. Uh, this is supported by fees and licenses. Madam Chair, those are all the requests. Thank you. I'm gonna take these items B1, 2, and 3, Senator Hickey, is your question on Adam? What item number? Be 12 or 3. Oh, All right, you're off now. Senator Petty, do you have a question? Thank you. Any questions for item B1, 2, or 3? They have a motion. Motion 2, all in favor say aye. All right, we're moving on to Adams and item C, please. Thank you, Madam Chair. These are American Rescue Plan Act appropriation requests. Uh, we're in section C. Uh, the first request is a federal award, uh, that's made directly from a federal department to a state agency and in the last 3 requests are awards made from the state fiscal recovery funds. Um, the first two are reallocations and the last request is for new money. So we'll start with the first federal award. This is uh C1. It's a request from the Department of Health. It's for 500,000 and uh American Rescue Plan Appropriation. They have a grant from The USDA to modernize the women, infants and children's or WIC program. Uh, the department will use these funds to implement telehealth for Wick services. On the 2nd page, the summary explains a consultation with a registered dietitian is required within 45 days if a participant is determined to be high risk. Uh, the department has had difficulty staffing registered dietitians and believe telehealth will be more cost effective given current staff, uh, and the travel that would be required otherwise. Next item is C2. This is on page 3, C2. This begins the state awards. This, uh, first one's for public safety division of state police. This is a reallocation of previously awarded appropriation. They would like to repurpose 1.6 million from a project to update Aw equipment to the construction of barracks at Camp Robinson. The letter explains the division negotiated savings on the Avon equipment and requests to repurpose those savings for the barracks. For the community's information, Pierre approved a similar repurposing of appropriation for the division in. May, that was for fiscal year 2024. Next item is C3. This is on page 5. this is for DFA dispersing officer. It's a reallocation of previously awarded appropriation. Mercy Fort Smith was awarded $12 million in February to assist in the construction of a 110,000 square foot, $100 million cancer center and it's going to be off campus. The request explains that plans have evolved and they would like to repurpose funds for both on campus and off-campus options. The on-campus option would be the Innovation and expansion of 90,000 square feet at an estimated cost of up to 80 million. The last item is C4. Uh, this is state police. This is $1.2 million in funding. Uh, according to the letter, it is for enhanced security efforts of the executive protection detail, which includes equipment and related professional services. And I'm sure those are all the requests. Thank you. Um, we're going to take them one at a time if you have a question, let me know. Item number one. Representative Burke, do you have a question? I turned to everybody off. Now, if you have a que a question for Adams either in 12, or 3, get back in. Representative Pilkington, do you have a question on item one? Thank you. Thank you. um, for this, uh, $500,000 in operating expense, can I get kind of a breakdown on exactly how many women we intend to see, uh. Through this telehealth program. Is there someone who can answer that question? Is anyone here that could come down and answer a question, please. Please introduce yourself for the record. Don Adams, chief of staff for the health department. Christy Sellers, division director for Center for Health Advancement. Matt Gilmore, Department of Health. You're recognized for your question. Uh, thank you. Yeah, I, so in this 500,000 we've got going, uh, I see that it's earmarked for um operating expenses. So could you give me kind of a deeper dive into what That consists of and then also on addition to that, I'm kind of curious how many women are we expecting to see, uh, with this program in the state of Arkansas. Representative, uh, thank you for the question. So our current caseload in WIC is about 65,000, and so there's a certain percentage of these women that we classify as high risk and those particular women, uh, go through what we call high risk nutrition eds. So we have non-high risk and high risk, so this particular program is designed to enhance our high risk nutrition ed that we do with our nutritionist and registered dietitians. Uh, Christie may know the breakdown of how many high-risk patients we have on average, uh, of that 65,000, uh, case load. So I just want to say it's not just a, sorry, it's not just women, but it could be an infant or a child that the mother is coming to see. So out of our 65,000, probably we would say at least 50% of them would register as high risk based on the criteria that's provided, um, by USDA for us. OK. And then So of those though, I mean, I'm, I'm kind of curious for this breakdown so it's 500,000 y'all are getting towards the operating. So is that just, I mean, I see it's not including salaries and it's not including equipment. So what is that 500 going to? I mean, I think it's a good program. I'm just trying to better understand what we're spending our money on here if we're not spending it on equipment or salaries, which are kind of the two biggest costs associated with a program like this, so that. Yes, sir. So this is just supplemental funds for a specific project. Wick has a very large administrative and food package budget. So this money is targeted to, uh, creating an online application so that we can do nutrition a through telemedicine. So it's this money is for a very specific project within within WIC. OK, so this 500,000 is just for creating this application process for this program. There's online, it's like an online form that would they would fill out and they would roll them and put them into teop medicine program. Well, it's a platform where they could schedule appointments, then you can have the interface with the nutritionist and, and so it's a complete telemedicine platform applications so that we can do this via remotely versus in person, which is what we're doing it now we only have 13 nutritionists Now to cover the whole state and when we're fully staffed, we have 40, so we have a, you know, a small number of nutritionists trying to cover the whole state and they're having to travel to 345 different counties to cover those counties, so this this will help uh efficiency wise and utilizing their time to dedicate to nutrition education. Got you. Thank you. Appreciate, appreciate, uh, taking my questions and I appreciate the chair allowing. Me to ask so many. Thank you. Or anybody else have a question for the Department of Health? Senator Johnson, who is your question for? Number 2? OK. Any other questions? All right, thank y'all for coming down. With that, we're going to go into Senator Johnson to answer his question if I can get him. And with that, if we can get someone down from DFNA? The state police, state police. Looking at the wrong one. And if you will, introduce yourself for the record, please. I'm Lieutenant Colonel Mike Kennedy. I'm Deputy director of the state police. I have with me Karen Perry, our chief fiscal officer. Senator, you're recognized is this are we transferring the money for a win to redo the barracks. Yes, sir, that's what we're doing. We're, we're shifting it from the AW project which is nearly complete, and we have a firm number on what that's gonna cost to complete that, and that's the leftover money from that project we need to shift over to our barracks project, which has run a little higher than what we expected. So it, it, it was a win money just to update your equipment or equipment around the state. It was two things upgrade all of our radios, both handheld and then the car radios and also our AWin maintenance equipment that you may be aware we maintain all the tower sites in the state of Arkansas. We had to upgrade some equipment on that side also. So those two things, radio and equipment. So it's not for updating your equipment across the state. It's for you guys, correct. All right. Thank you. Questions? See you then, thank you so much. Thank you. Any other questions, members? All right, wish I hate this new system. So anyway, any other questions? Seeing nonmembers to have a motion. 2. All in favor say aye. All right, with that, we're gonna move down to item D please. Thank you, Madam Chair. We're in section D. These are the infrastructure investment and Jobs Act appropriation requests, the first item is D1. It's a request from the Department of Transportation. This is for $280 million in appropriation. This is to provide for the federal operations of the department that are funded out of IIJA for the next quarter. Next item is D2. D2 is on page 4. This is a request by Energy and Environment Division of Environmental Quality. It's for $165,000 in spending authority. This is to provide for the water quality management planning program and that supports the Clean Water Act programs. Next item is D3. This is on page 6 of the packet. Uh, this is again energy and environment. This is the Office of State Geologists. This is a reallocation of previously awarded appropriation. They are requesting to move 92,000 from salary match to extra help. This is part of their mapping project regarding zinc. Uh, the request notes that the grant was awarded after their budget was approved and extra help was not included in that original budget. This reallocation will provide for that correction. Man, I'm sure those are all the IIJ requests. Thank you, Senator Dismanger recognized just for our staff, but on the $280 million appropriation, how do we track what projects are being, you know, allocated to be able to utilize that appropriation or, you know, I mean, I know we've got it, and then how much of the odds and money is left and so we do keep track of how much I I appropriations awarded, that's where the dispersing officer's bill and so I can pull that number up for you. As far as how they're getting this appropriation, it's because they, they're Normal federal operations, uh, would have come through an infrastructure bill, and when we passed the special language for IIJA, it requires all items funded out of IIJ to be approved by ALC and for the purpose to be stated. So this is now the mechanism for them to get that normal operating budget they would get from the federal dollars. As far as where that money is going, they have their STI program and they have uh, you know, their normal letting and uh we'd have to pull the department forward to actually get an accounting of all those different. Projects or the uh ALC subcommittee for, um, Arkansas Highway. HRs committee. I mean, other members may know more, but I thought part of the reason the special language is there to have a little bit of detail about what was happening with the Odds of money and uh there's not any detail in the presentation. I think we've rolled through this a couple of times now. Again, I'd be happy. Gil or whoever might wanna Somewhere from the Highway Department police come forward just where do I need to go look to see how we're utilizing these dollars. And if you'll introduce yourself for the record, please. Patrick Patton, uh, R dot CFO. Um, the tracking, we, we have job codes that we can provide you a list of exactly what jobs they're in our vernacular, it's Yode jobs. And so the way we use this I of appropriation is our main appropriation or a quad zero, which is the main operating fund. Everything has to go through it first. Then we do some transfers that DFNA was very. Kind to help us walk through and get them working. And so what ends up in the, it's called the FIIO 900 appropriation, which is Aja. What ends up there are the Aja jobs. To know. We're not able to track projects in AI. So in order to get you a project by project list we'd need to get with our program management people. So I think, I mean, and just in a rewind and someone else just made. Disagree and, or, you know, may not remember kind of the way, but I think the goal was so we could kind of know what we were doing with these dollars, what projects we're getting funded, what we get in front of us right now, and I think his story, how many times have we done the appropriation? How many quarters we passed through. Probably 8, 10 quarters. I couldn't tell you what we've really done, right? And I couldn't report back to my constituents what we've done, um, and I'm sure it's a list somewhere and, and I may have missed it, uh, but I think it's so that we could understand what was happening with the dollars kind of. Have a little bit more oversight or we should have just given you a full appropriation for the entire year and said go do what you want to do because that's essentially where we are. And, and improving this, we're proving it blindly. So and I think one of the, when we were talking back and forth, one of the, one of the, um, Suggestions was to present. A Y code report to HRs when we do meet, um, as opposed to the appropriation, but we ended up going the appropriation route. So, uh, that's, that's still a, a possibility. Well, maybe in the next couple of days we can. Whoever needs to be a part of that conversation, uh, and would like to be, if we can kind of, if I would like to go ahead and get a list of what's happened so far so we can kind of talk about the improvements we've made and, and how great we're doing with the dollars, um, and then also just kind of what the future plans are, you know, we, we keep letting out more appropriation authority in what we're going to do with those dollars. And, and to give you just a quick History It's probably been close to $500 billion that has been sitting over there, but it's, it's hard to judge, you know, with federal dollars coming in, how much is gonna be needed in that appropriation. And so, you know, probably over the past 3 years that I guess Billy, we've been doing it. Um, it's been 500, 6000 somewhere in there, but I, I track monthly the dollars that go through. The Aja uh appropriation from a dollar standpoint, not a project, not the, the individual projects, but we can get you the projects. So and when we say we're gonna allow this to go through, who oversees that are, are these already, so these are projects online you just may need additional authority to help cover or is there going to be something, what happens after we let this appropriation out for y'all. It's just a tracking mechanism for you all. I mean, If we wouldn't have had this additional appropriation, you would have been able to see it in our RA quad zero operating fund. It would have just stayed there and we wouldn't have to transfer between appropriations. So this is more or less a tracking mechanism for the legislature. Um, and us, we can, I mean, I can see what hit Aces and what sparked there without having to get into the project based piece of it. But there's no restrictions on how you can utilize those funds so they could be used for projects that were already in line, or do they need to be used on projects that maybe weren't thought of an additional improvements or what is the restriction for RO on utilization of the IA funds. Some of them are, are, um. Some of them were already online from previous appropriations, you know, uh, CARES Act or whatever, and we've, we've moved them to AA funding. Uh, because our, our funding from the federal standpoint is fluid. And Aja is just one piece of it. And so, um, we have about $500 billion like I said, that's parked in um. The I of appropriation, and then we have about 50 billion that's non-Y jobs that's in our regular appropriation. And so we have about $1 billion that depending on the job mix and how they get assigned by program management, um, It could tip one way or another. OK. And, because for instance, that's a big influx, we can use them on existing projects and in a minute, I think we're going to be asked to approve an additional $20 million essential, I think it's transfer, it's the interest transfer, transfer, um. I mean, is that even needed if there's the additional I of money flowing through that was unanticipated. You know, what do we do? Anyway, we can have an offline conversation about that, but I do want to make sure I understand what's happened to dollars and I'll get off the queue. When you get that information, if you'll give it to the staff so we can get it out to all the members. I'd appreciate that. I can do that Hrest is a highway commission review and advisory subcommittee. Thank you. All right, Representative Wardlaw, you're recognized was my language a few years ago in uh. In session and and one thing we asked for was this to be done a month before the quarter in which it was going to serve and if my understanding is correctly, this quarter that we're approving right now starts October 1st. Is that correct? We try to do it 3 months in advance, but, uh. This one is starting. I'm sorry. Um, October. Yeah, so the problem with that is, and the reason we asked you to at least be here 30 days ahead of time is when members had questions, it would not hold up your budget in any way, form or fashion, it would give plenty of time for those questions to get answered. And not having a detail project list, which needs to be submitted every quarter with this puts us in a real precarious situation, meaning that Friday's 3 days away and are you gonna be able to get that here by Friday? Are you going to have an appropriation or not on October 1st? So I think it's very advantageous for y'all to get these things submitted to council in that 30 days advance, which is what we agreed on in the, in the beginning. Do you understand what I'm saying? Yes, sir. And, and we have up till now, uh, the year-end causes some issues of us having to wait for, um, The dispersing Officer Act to actually request from it. And so there's some timing issues and, and I probably didn't get in on time. Well, we need to see that project list before Friday. Thank you. Any other questions, members? See you then. Thank you. Appreciate it. You'll get that information, we'd appreciate it. And No other questions. I have a motion. Do I have a motion? Motion, do have a second? All in favor say aye. I don't say no, all right, with that, we're gonna move on to Adam and Eve, please. Thank you, Madam Chair. We're in the restricted reserve fund transfer request. This is section E of the agenda. Uh, the first item is a letter from Public Safety Division state police. This is a $3.2 million transfer, the transfers from the state police troops school and recruitment set aside. Uh, this will allow the division to hold a recruit class of 70 positions. This transfer with zero out the set aside account made for this purpose. It was originally allocated at 6.4 million. The next item is a letter from Public Safety, State police. This is a $450,000 transfer. This is from the various general discretionary majority votes. Set aside account. According to the letter, the transfers to fund the quartermaster appropriation authorized in the last session, the quartermaster is responsible for uniform assignments and maintenance. Madam Chair, those are all the your requests. Thank you very much. OK, members, questions on E1, who's got questions on E1? All right, Senator Hickey, you're recognized. Thank you, Madam Chair, and I guess I need the uh department up here. The department, can you please come forward. And if you'll introduce yourself for the record, please. Uh, Lieutenant Colonel Mike Kennedy, uh, Deputy Director of Arkansas State Police, Award McCarren Perry, Chief Fiscal Officer. Thank you for coming forward. Mine, mine's simple and you can do both of these at the same time or is this just a one-time funding you need and you're not gonna need it any longer or the way I look at it that it is going to be ongoing, is that correct? We're talking about the, uh, quartermaster system. I'm talking about we can talk about the 3.2 1st. That's for troop school, that's for the recruiting, hiring, equipment and training and paying their salaries for one year. OK, so after the year, You're never going to need that money again. For salaries. Well, yes, we will need money for salaries, but it should be in our base and then with attrition I mean it should kind of all work itself out. So you're not gonna come before us to need more money in RSA or anything for that. You're telling me, you're telling me that although we're, we're giving you this out of an account, just. Checking account or savings account or whatever. I guess what I'm doing and I do this all the time for DFNA get aggravated at me, but that's fine because I like to, I like to make sure, you know, where our current budget is, you know, we're taking a lot of stuff out of just. Cash accounts. I'd like to know what is coming. So is there any of this money that of this 3.2 million that really needs to be ongoing that needs to be an RSA from year to year. Potentially salaries. I mean, if every position for for troopers was filled 100%, then yes, we would need it, which is what y'all need. I mean, from my standpoint, I think we all can agree that y'all are short and how much is that particular portion of it. The salaries for if we hire 70 it's 4.5 million. So this 3.2 doesn't cover everything for troop school. This just supplements, supplements it. So next year, So next year, if you didn't have this this money from this cash account, if you needed to take it from your, from your base. What I'm asking you, do you have enough money, appropriation? Do you have enough already in your base, or are you gonna need to up that in the, in the future years. We're good at this moment in time we have about 90 positions open right now, and this is funding for the 1st 50 of that. So we're good on funding moving forward as long as we don't get up to 90. Once we hit that 90 threshold, we would have to come back. We're having a hard time filling vacancies like everybody else and I knew that, you know, and I, I'm not questioning that part. I think that you need them. I think you may need more than what you're doing. My only thing is that as it relates to the money, is whether or not We haven't we already have enough within RSA to cover. These future needs that you're actually getting out of a cash account. And you're telling me you do, is that correct? Correct. Right now we do. Right now. Are you, how about next year? Next, next year we're fine. I think it's gonna take the the current rate of vacancies and attrition we're having for me to fill those 9 we're looking at about 2 years probably at least at a hard recruiting push to get that done. Could I ask, does DFNA is with the heading, do they agree with that statement that there's enough there? Have you looked at that? Thank you, sir. Thank you. All right. Senator Irvin, you're recognized. Thank you, that was one of my questions, but then can you also tell me what the quartermaster amount is and what that more specific about that. I understand the, the, the troop school, but I'm confused about the quartermaster funding the uniforms for our troopers, uh, in the past we've done that through our state police association, which is a private entity, it's been a money losing proposition for them the entire time they've done it. Uh, that has been funded basically out of the troopers' salaries when they pay dues in the association, and they've lost money every year they've done it, so we've seen an opportunity to take that over as an agency to run that for ourselves. This will fund buying out all the association stock they had as far as uniforms and also funniness for a one year moving forward. Thank you. Appreciate that. Any other questions, members? There we go. Uh, the quartermaster, that was a legislative initiative and a request by, you know, legislative body, uh, you know, both chambers to set that money aside and restrict the reserve to be able to fund. And second, on the troop school, uh, I think y'all actually had that in RSA. We had a long discussion about was actually when needed for, you know, one time for the troop school. It was determined this was the amount and so we actually made the pool ourselves to take it out of RSA, the legislative body, did, um, and then That's why it didn't make it in an RSA in this one time, I paid for out of restricted reserves. So just as a, a little bit of background, this is us, I think, trying to make sure that we held them accountable and we also don't go go faster than we need to by allowing additional funds to build up inside the arts, say, an additional cost to grow inside of RSA, uh, that were only one time in nature. So that's the. Background there. Thank you. Thank you. Any other questions, members? Seeing none, thank you very much. Do I have a motion? Motion 2. All in favor say aye. All right. Thank you. And with that, we're going to move down to item F. Thank you Madam chair, we're in section F. This is this is an appropriation and or fund transfer request from the Department of Transportation. This is a $20 million transfer and this transfer is from the highway transfer fund, that's from interest earnings in the Treasurer Securities Reserve Fund, the Arkansas Highway Improvement Plan 2016 sought 50 million from existing fund sources to produce a state match to withdraw down all available federal aid. Proceeds from the Securities reserve fund were a component along with state surplus and a few other sources. Uh, this act requires approval from ALC to make the transfer to the department. You're recognized senator this morning? And, and The background on it was that this was to be able to make sure that we're meeting our federal match obligations. I don't think we're in jeopardy in any way right now. I mean, if we didn't fund the 20 million, I don't think we are jeopardizing a federal match. I just want to make sure that I'm correct on that. I'm not opposed to the transfer and, and helping the highway department, but moving forward, I do think we need to make sure that we're using it for its initial reason in 2016, which was to achieve a maximum federal match. So if someone can just speak to that real quick. If you'll please come down and introduce yourself for the record, please. Patrick Patton Rdot, CFO, um, we do use the $20 million every year. We are probably one of the few states in the nation that Uses all of our federal funds and, and we need the match to be able to do that, the 20%, 10% or, uh, Match for the federal funds that allows us to do the projects that we need to do. And then it also lets us use our state funds, uh, more efficiently that we get from motor fuel taxing. So, but, well, right, so we're, we're using those funds because they're not obligated, a little more freely. And this 20 million then goes to help, you know, do the things that are required to meet a match. Is that fair? So all we did was expand the money. That is available for more things at you at the, the highway department's discretion for, for the federal match, yes, for federal use of federal funds. OK. But as far as you're not a shortage of cash. I mean if you had to in this 20 million didn't exist, it just means you wouldn't have as much discretionary money as you have right now. You just have to obligate that 200 million out of Those other funds. We may have to pause, we'd have to look at pausing potential projects, even with all the a of money, you would pause projects could, could potentially. Any other questions, members? All right. Senator Hick you recognized. Yes, I just want to thank you for, thank you, uh, just along the same lines, this is a 20 million, but if I remember right, you're also getting, uh, 50 million. We have a cap there. I thought that that was actually for the federal match, is that not? Like we do, uh, up to, up to $50 million which comes out of surplus. We can use it for projects and match also. I mean, we can pretty much use any funding we have for match, but With This 20 million, it allows us to use, like I said, our state resources that we get, understand, but more efficiently. But we didn't, we didn't bring up that we also have that uh 50 million that's in there. How, I guess maybe we should ask it this way, what is currently the federal match? We have a dollar wise, that's hard to, hard to put a finger on, but we have projects that go anywhere from Uh, 90, 10%, us. 80, 20. And maybe even some, some 70, 30. And so it just depends on the mix at the time. What was last year? I'd have to get back to you of what our actual match was. That'll be fine. Thank you, sir. So I have a question. So you're saying that at any given time, you can't tell us what you're required for match is going to be? On projects that you've got ongoing, you can't tell us what your federal match requirement is going to be. I'm sure we can. I don't have it I'd like to have that by Friday, please. Uh Just a little more commentary so everybody understand back in 2016, the commitment was to try to achieve $500 million so that our, our dot because there was some risk that they might not be able to meet the federal match over time because of the gambling money and whatever else that goes into the pot, you know, which is money that we've directed from GR, uh, so for instance, 2024, uh, there will be 108 million transferred to Rdot in 2023, there was was 116 million transferred to R. In 22, there's 115 million transferred to ARDA. And again, the original goal was 50. We are, you know, we are, and I guess that's where I'm a little bit confused is we needed 15 to meet the match, but now we're saying if we don't get 115 or whatever the amount of money is, then we're probably gonna have to pause projects and that's on top of all the Aja money coming in, and I don't, I don't really want to stop any of this. I just wanna make sure I understand what we're doing because. It's like the ball is rolling and no one's paying attention and that's whether it be on Aja and how we're utilizing those additional monies. However we're utilizing the additional monies that are coming in, you know, that we're diverting away from GR or general revenue. So I, I just would like to get a better understanding, um. Because as staff has also pointed out, I mean, everything goes in one big bucket. And no one really can understand what's happening inside the bucket and unless you're at our dot, um, so with that, but again, we, we are, we are way above the 20 or 2016 goal of 50 million and we're sitting at 108 for 2024 alone. So. Is that, and are you including the casino in that I am that, that's parsed out with Act 416 as pavement preservation projects. So that is a little different, but yes, that's money that has been diverted have typically been GR to the highway department though. Thank you. Yes, if you can get that information by Friday and get it to staff so we can get it to all members. Appreciate that, um. Senator Hammer. You're recognized for question. Thank you, Madam Chair. And this may just got asked me, but just didn't get answered the way I was expecting to hear it. With this 20 million or without this 20 million, what projects would not move forward. I'm not, I'm not on the program side. I'm just saying, I'm just making the statement that it would have to be looked at. So could you have that by Friday as far as which projects are, is that, no, that, why would that not be available by Friday because We don't know. I mean, we could look at other options for money. I mean, I was just making the statement that it would be a potential analysis that we would do. If we, I'm not, I'm not by any means saying we would stop projects, but it would be part of the analysis going forward that we have our cash balance where we need it to have our operating funds going and do projects. So you, there's not any right now, there's not any. Projects on a, on a cut line. OK, so you want the 200 million. So that as you move forward if they're and federal and projects with federal money attached to it, you want to know you got the $20 million to be able to obligate to those projects because you know you've got 200 million that can make up whatever the matching grant is, is that the idea? And, and be able to. You know, apply for future grants also. Which you can't apply without can you apply knowing that you could come back and ask for this at a time in the future instead of having to ask for it now. That you could come back and say we've got potential for this and we need 50 instead of 20 million? Could it be done that way or? I'd have to check. OK. All right. Thank you. Thank you, uh, Senator Irvin, you're recognized. I, I think along the same lines of questions as, as mine as well. So, so maybe the staff can also answer this. So we have the, the plan established the Arkansas Highway Transfer Fund, and it is, it is accumulating funding, correct? OK. How much is the balance in that? Billy, do you know the transfer fund is specifically for the security reserve fund interest earnings, and what happens is after the securities reserve fund hits a certain plateau, it's like I got a cascade effect. The first however many dollars go to this. So the next however many dollars go to this next source. And so they've hit that threshold for the highway transfer fund, that's $20 million because we're already early in the year, they've been doing well with the interest earnings right now. And so that's what that that fund is for and then when they created that, they want to have an opportunity to speak with the department, so they created an approval function through ALC to do that. So the other sources of funding like the 25% of the state surplus, the, uh, eliminating the, the, uh, 3% deduction for the state central services. Or the Constitutional offices fund that that's automatic and it flows. OK. So is there ever a point or is there a mechanism to be able to look at. Um, a healthy. Um, Arkansas Highway Transfer Fund balance to then reduce the state GR portion. Do we have a mechanism to do that so that we can rely on the specific funds versus state GR from year to year to, to, to make sure that we're just being smart about our finances, that's, that's more of a policy matter that this is just the way the code is set up currently. OK, well, I, I, I just, I feel like, I mean, and not to, I just, it seems to be, we're just going to take as much money as is allowed to us no matter what and we need to all be operating in the idea that we need to preserve state general revenue as much as we can and depend on first funding that's set aside specifically for these types of things first and be able to kind of create sort of a, um, mechanism to where we can reduce the state general revenue appropriation transfers and if this, this fund is healthier in some years versus less years. Does that make sense? I'm looking at DFNA because I feel like that would allow us a little bit more flexibility in our budgeting process with state general revenue if we had that kind of mechanism and also to Senator Hammer's, uh, Line of questioning. You can, I don't see any reason why you wouldn't be able to point to the state of Arkansas having a set aside fund to be able to use for match, um, and then bring to us the specific and say we do have this money set aside for a match. Um, I don't know why it needs to be transferred over until you get the project, um, and then we create those matches. But that's something that I think we need to into at DFNA and the, the highway department, um, moving forward. It's just my, I'll kind of comment with a little bit that I understand. The problem is it's all going into one pot, essentially, and so there's no appropriation for how we police. Exactly, that's part of operations. There's no appropriation for all the rest of the world we were required to break down into silos so we can track and understand what's happening. And so, for instance, you know, to what you're wanting to see, it doesn't really matter because as he was talking a little bit ago. The more money they get. To, to go towards matching. The more money that frees up that they were previously using for matching for non-discretionary items. So they can spend on projects that they would like to spend it on that aren't tied to a particular match required by the federal government or even maybe the requirements of that project for, you know, by the federal government. I believe that's kind of so. In what we're doing, we've exceeded the 50, but we're allowing them to have more flexibility. On a department level, but we can't see that because even as he was saying earlier, it all just kind of goes into one big bucket that they then, you know, so it's all fungible. What I'm saying is like we will never be able to tie back into the current situation to understand what would have actually been spent on maintenance versus matching or whatever it may be, these non-discretionary items because they can just kind of move it inside the big bucket right now. So you can always make an argument that you're short on matching. Under the current situation. Right, well, and, and that's I. I mean, I think it needs to be addressed moving forward, and I think I would agree with that assessment, but it needs to be. Maybe looked at with more specific details, but I don't know if it's appropriate to prove this or not at this point unless we have this information before us on Friday. Senator Petty, you're recognized. Thank you, Madam Chair. So along the same lines of the questioning that's been happening. I mean, obviously, we all agree that we've got infrastructure needs throughout the state. And, and we're spending as much dollars as we can on those. Is there any way to tell us if by the 50 million that was set aside to begin with that got us. I'm just gonna use simple numbers. $200 million in federal funds, but because we got 115 million in the one year. We got $400 million in federal funds so we let you gave us more money, but we leveraged it and got more federal money. I mean, is there any way to determine that or have we, in essence, you know, took out on the, uh, the 100, 100 yard dash and, and won it by 50 yards because we just We, we, we got to the 50 million and then surpassed it. Way too quick. Some of the money that is not tied specifically to. A match or something like that, like, uh, Senator Justice May was saying. We're able to. Bring our fleet That's actually preserving these roads, creating, building these roads up to better standards right now, our fleet is probably about 25, 30 years old. And so in order to be more efficient, Some of these state funds that, you know, the 20 million, 50 million allow us to use our motor fuel for those operations that, that you were talking about, whether it be highway police or, um, um, others through our normal budget process to improve our work environment for the people that are out on the road and improve safety with newer machinery. So there are some things that we're able to do with that. Thank you. And I think that's part of the problem. That wasn't the original intent. Now if we need to pivot to that, that's fine. And, and then I know you didn't mean anything by it, but I've been a part of this. Well, we may not be able to fund a project conversation before, which I've typically find to be more. Smoke than reality. Um, I think it's something to say, um. And then it puts everyone in this room at pause because we don't want to jeopardize a project in our district and I don't think it's a fair conversation to have. And, and that's not where I, I, I understand, but I've, I've got a pretty long history with those threats before from the highway department. Nothing that I took very kindly to and hopefully something that we've remedied in I'm, I'm quite sure we have in the new administration there, um, and with the new, you know, commission. Uh, but I do want to steer away from that conversation because we're not at just. We're not at a threat of being able to, you know, have a problem and not fund a project we're at a threat of maybe we don't replace a vehicle in the way we want to replace it and we have to use those monies on. Uh, matching, that's, that's the conversation we're having. But again, we don't get to see that level of detail or be a part of that discussion. Because it wasn't set up that way in their appropriation isn't set up that way and their existence isn't set up that way right now. Uh, now, if we want to be able to look more closely, we could treat them like we do other agencies. Um, in how we set up the appropriation structure. Uh, and then we could see what was actually set aside and used for matching for federal money and what was set aside and used for maintenance and all those sorts of things, but right now we just, we can't see it at that level of participate or be it a, a, um, you know, a. You know, a contributor to the conversation of how we prioritize those dollars, so. And that was not meant as a threat. I apologize. Thank you. Representative Rye, you're recognized? Thank you, Madam Chair. A couple of years back, we weren't quite as. Great a financial condition as we are now, but uh. I remember the figure of $50,000 matching with 200 million and we did that at the tail end of the session and I asked the question one time, if we wanted to come up with more money. And you know, could we not match out a 4 to 1 on that and I was told back then no, but let me ask you this, sir, is this the answer actually here is this some added this placed on all of the. The figures here toward the end that basically puts this in a condition that. You're not getting 80/20, but you may be getting 60, 40 or or 7030 or something like that. Is that kind of tied into that? There's, there are different formulas for the federal. Projects and they're they're. By the federal regulations of that funding source. And so we do have anywhere from 9010 to 8020 to 70, 30. And so that's where it's kind of hard to put a, put a flat number on what our match is today. Um, But it, like I said, it allows us, you know, just to, just say the the 20 million and we were doing, uh, 80/20. That get us uh access to $100 million. So it's a leveraging mechanism for us to get. More money to put on the roads. Um, By using this match to get to the federal dollars. Thank you, Madam Chairman. Senator Hammer, you're recognized. Thank you, Madam Chair. Just one quick one. For all the money that you've received, having heard what the intent was, the 50 plus what will now be the 20. All that money, can you say that it has been attached to, uh, projects that had the matching fund requirement to it. The 20 million, yes, the 50 million, um, we use what we need for match and then other might go to operations. OK. And maybe that was asked for somewhere previous to this question, but is that something you can identify what the percentage was. Or If not, could you have that by Friday? I've, I've, I've got that written down, the actual match as of today. All right, thanks. Thank you. Um, with that, we're gonna go to Senator Hester, you're recognized. OK, Senator Hester is not recognized. We're going to move on. Senator Johnson, you're recognized. So a lot of discussion with these things being before Friday, uh, In the future. Can we bring these just like those projects above 100 million with a Y class and funds and, uh, to, uh, age grass and that way we will, we will be able to give that report to the full ALC. Uh, where those funds are being used in the future. I think that would, I think that would solve solve a lot of the issues. I know there's a lot of questions with, with these funds, but the future funds, uh, you can set up a system to track them and, and, and give us a. We can do that. Thank you. Sandra Chesterfield at the proper time. I'll take your motion at the proper time. Mo review. Any other questions? I think this is the proper time. We'll review. Approve, approve. 2. All in favor say aye. OK, with that, it's approved, we're gonna move on to Adam G. And these are for review. Thank you, Madam Chair. We're in the review section of the agenda. We're in section G. These are cash fund appropriation requests. The first item, the only item is a letter from the Department of Education, division of Higher Education. This is for $500,000 in spending authority is to allow the division to make grants to schools for substance misuse and prevention and recovery programs. Funding comes from DHS through a federal grant. Without objection, these items are going to be reviewed. All right, we're gonna move down to item 8. Thank you, Madam Chair. We're in Section H. This, this is a miscellaneous federal grant appropriation request. There's only one, it's from the Department of Commerce, Office of Skills Development. It's for 618,000 spending authority. They have a grant from the US Department of Labor to expand registered apprenticeships without objecting, this item is going to be reviewed. All right, we're gonna move into item I and this is an item for approval. Yes, ma'am, uh, section I is a modification of loan payment requests. Uh, Henderson State, uh, received a $6 million loan from the Budget Stabilization Trust Fund in fiscal year 2020. They currently owe $5.7 million on that original loan. Special language in their act establishes a payment schedule. A payment of 958,000 is due in December, and each subsequent December until the loan is paid in full and that would be in 2029. Special language also allows ALC to approve a modification of the schedule on today's agenda, Henderson requests deferring payments in their schedule by one year. According to the letter, they are still in need of more time to achieve significant progress towards stabilization and growth. Remember, all right, Senator Hickey, you are recognized. Mr. Broadway to come to the table. Thank you. You please come down and introduce yourself for the record, please? Thank you, Madam Chair. I'm Shane Broadway, ASU system. Trey Berry, Chancellor of Henderson State University. You recognized Senator Hickey. I'm over here to your left and, uh, Mr. Broadway and I have already had this conversation after receiving this, and I have some other information. Where you had received cash on hand, uh, I believe that. It's been well stated here how we, we all know how we got to this point and we appreciate you all for taking it over, but after looking at it, there's been some discussion that you could possibly reduce this by 300,000 is, is kind of what we're hoping for. Can you all do that, uh, instead of us. Instead of us delaying this in the whole 958,000 due to the 958 330, instead of doing the 958 that you just paid 300. And that's not a number that's just, uh, grabbed it out of the air, uh, members just. Tried to, and I don't know if this is the right way to do it, but with a normal loan, of course, somebody would have interest, uh, this loan does not have interest on it. But if you were to figure what the interest would have been, uh, You know, based on what the treasuries are, that would be a, just a tad over the 300,000, so we just think that you should at least reduce your principal by that. So, can we somehow get that commitment here and do what we need to do to, to get to that point. Senator, uh, we will definitely look at that I'll work with my CFOs, but I will tell you it will hurt. Uh, and I'm afraid it's going to hurt our students and our, our people, if that's the case, you know, if I may, when I came on in January, I was charged with riding the ship. Uh, and that is happening right now as we speak, our freshman numbers are up, our transfers are up. We have a very professional and detailed budget process in place, but from where I sit, We need this year to get our sea legs. Uh, I've looked at this backward and forward, and, uh, I fully believe that if we can have this year, we will get our legs under us to be able to meet our commitment going forward. Well, I'm gonna continue to say that I'd like for us to do the 300 and I'd like for this committee to defer that, you know, and, and I do want to give y'all full credit because you all did some went went through and did some analysis for us and I know your cash on hand, you know that if the way it's sitting would be, you know, you got it at 98 days if we deferred the whole payment, you know, it would continue to be 98 days, it appears like. Uh. If you paid it, you said that it would go to 88 days. So I think we're still gonna have, uh, sufficient cash there unless we have some unforeseen circumstances. I understand it's tight and I understand you've been through a lot. I also know this that the other institutions, you know, they're, you know, they kind of look at this like, well, we understand that you got into trouble, but by the same token, you know, we're expected to operate a certain way. I just don't think that's too much to ask. So if I need to make that motion I'll be happy to do it or if they want to amend it sitting there however we need to do it. I'm not for sure about how that's appropriate. And I just want to make sure I understand this loan originated in 2020. We are now in 2024, 2019, 19 before Arkansas State University system came involved, they took out the loan in the summer of 2019. And that's the challenge, and I, and so I, I, I'm going to yield to the body, uh, whatever the body chooses will try to abide by, uh, I just know having lived it every day since 2019, the challenges, the Chancellor inherited and our request was to give him some more time. He has worked wonders since arriving in January, um, just as a reminder of the cuts that we had to, to go through just to get to the position where he is now when we walked on campus, they had 6 days. Uh, of cash on hand. And so we're, we're just trying to give him some more time. There are some projects that we're working on that we were hoping would come to fruition by the end of this calendar year. That are going to take into the next year, uh, trying to reduce his debt, um, because as a reminder, if, if something happens in Henderson closes, uh, the state inherits $68 million in debt, and that's a debt payment you'll have to make, uh, or take over those facilities. So it's annually he's having to spend $70 just to make that debt payment. So we're trying to look for creative ways to try to reduce that. And we're hoping by next calendar year, we can do some of those things. We're looking at selling some properties and those kind of things to try to reduce the debt so we could. Uh, we could make, uh, the payment going forward and, and my intention, I think the Chancellor's is not to be sitting back before you again asking for, uh, an extension. Uh, the fact that he brought enrollment to where it is. I've said the last several weeks is nothing short of a minor miracle, uh, to be where we're at today, uh, but we just feel it would be in his best interests in the, in the institutions, uh, if we could, could defer that, but as we've said, we'll work with this body. Uh, and we'll defer to the will of the legislature and Do whatever you request us to do. We'll figure it out. My, my concern is that we, we defer it and then you come back again and say things are still not improved and we're going to defer it again because we, I mean, I'll be honest with you, I wish I could get a heck of a deal like this on some of our loans, but I mean, and you know, be honest with you, I, I have constituents that do watch this and they're like, how did they get this loan when we can't get this loan we got other institutes that want that same question. So that, that is my concern is we, we defer this and then you come back at your letter and say things didn't improve, you know, we need to defer again. And that's certainly not our intention. Uh, there are certainly things that could happen beyond the chancellor's control. Uh, we didn't anticipate a pandemic in 2020. I mean, there's, there's things that could happen that, that we could be setting back here. It is not our intention and not our plan, uh, to be doing that, but I certainly understand where you and your constituents are coming from, Madam Chair. Madam Chair, if I, if I could, uh, I totally understand that as well. Uh, from where I come from, but I will assure you that I am going to scratch and claw to try to make this right with the state. That is my commitment. That's why I was charged to do, not just turn around the ship, but also to make good on the places that Henderson needed to make good. Uh, and so Sandra Hickey, you're recognized. Thank you. And, uh, again, I want to make sure, make sure that I say we appreciate you and ASU, but at this time I would, would like to make a motion. And my motion would be that, uh, because just to tell the members, if I remember correctly, we did special language and the special language allows ALC to modify. Modify that payment so that's what my motion is about to be so that it'll match up with that special language. So our motion is to allow them to pay, uh, 300,000, which will be applied to the principal for this one year, and then it'll go back to the original amount which it looks like is the 958 330, 333 33 motion. Do I have a second? You got a second? All in favor, say aye. Those opposed say nay. Um I'm gonna say the noes have it. Do I have a motion for approval? Motion 2. All in favor say aye. A. I'm gonna say the A's have it. Thank you, Madam Chair, members of the committee, thank you we're gonna go down to item number J which will start our report section. Thank y'all. Thank you, Madam Chair. We're in the reports. The first report is an annual report. This is the agency carry forward of unexpended balances, uh, special language allows certain agencies to carry forward unexpended general revenue fund balances into the next fiscal year. The la requires a report to ALC of the amount to be carried forward from fiscal year 24 into fiscal year 25. If the balance is carried forward, a purpose of the funds is provided. All right, any questions members? Seeing none, we're gonna go down to Kay. Thank you, Madam Chair. The next report is a quarterly report. This is from DHS. It's a state hospital damage report. ALC approved 5 million $85 million restricted reserve fund transferred to DHS last September for storm damage repairs at the state hospital. The repairs are to be covered by insurance on a reimbursement basis. As a condition of approving the transfer, ALC required quarterly reporting of the status of the project. Uh, the department's report shows 585,000 expenses have been incurred as of August 30th. And work has concentrated on asbestos abatement and flood damage remediation. Any questions the members, seeing none, we're gonna move down to Iamel. Thank you, ma'am Sherber and the monthly reports, the first one is the surplus income and distribution report and it shows the sources of unobligated funds and then the distributions for the restricted reserve and catastrophic reserve fund as of the end of last month. The restrict reserve fund that's in the middle table shows 500 million in total distributions and overall balance of 2.32 billion. The total catastrophic reserve fund balance is $1.8 billion. The second page of the report breaks out the set aside accounts within the restricted reserve fund. On today's agenda are 3.6 million in transfers, uh, those, those requests from the division of state police, and they come from the set asides 012 and 01. Should they all be approved at ALC, the new overall balance of the strict reserve fund will be 2.32 billion. Uh, the next report is L2. This is the Budget stabilization Trust Fund report and it shows cash flow loans throughout the fiscal year. As of the end of last month, there are 19.9 million in outstanding loans and the cash balance is 192 million. The next report is tobacco settlement report. It gives a summary of income, fund balances, investments, actual payments to the state, and on the second page are all expenses by fiscal year. The next report is the State Central Services Fund report. This is L4 and it shows the fun balance and dispersements as well as the expenditures of each agency supported by the fund. Uh, L5 is the American rescue Plan report. The 1st 7 pages shows requests were approved by the state. Uh, the balance of the state fiscal recovery funds in the report is 76.89 million. The division of State Police requests 1.2 million on today's agenda. That would be uh the new balance would be 75.69 million. On the eighth page, uh, begins attachment A, that's report of ARP funds that were sent directly to state agencies and on page 12 it's attachment B. That's report of funds were sent directly to institutions of higher education. The next report is one of the new reports. This is the education, uh, adequacy fund distribution and fund balance report and, uh, The new special language in department's appropriation Act requires reports that summarizes the current fund balance and the past five-year fund balances of the education and adequacy fund. Uh, the fund was established in 2003 to fulfill the obligation of the state to provide an adequate educational system as authorized by law. The fund is comprised of revenues from sales tax, vending machine decal fees, diesel tax, franchise taxes, prior to each year, the department certifies how much they believe they will need to draw down from this fund. Funds are drawn down each month until the certified need is met. Once the certified need is met, monthly revenues continue to flow to the adequacy fund and the balance builds until the cycle begins anew in the next fiscal year. On the 2nd page at the top, it shows the fund balances from fiscal year 20 to 25. The second table shows the monthly transactions. The fund had a balance of $118 million at the beginning of August, 60.9 million was deposited to fund that month. There are no transfers because they have been recertified. Uh, this leaves a balance of 179 million at the end of August, and this mount will build throughout the year unless the department re-certifies the need to draw more funding. The last report is the Medicaid program Trust fund distribution and balance report. And again, new special languages and departments Act requires this report to appear that summarizes the current fund balance in the past 5 years on balances of the Medicaid program trust fund. On the next pages are our 5-year history of the balances by month with the column showing the sources of income and on the last page is the Medicaid trust fund distribution for the last month. For the month of August, 68.9 million has been distributed from the fund for hospital and medical services and for nursing home care. Madam Chair, these are all the. Do you have any questions? Seeing none. And seeing no other business, we are adjourned. Thank y'all.