House Revenue & Taxation Committee
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He's got some thoughts that he wants to share with the committee. Speaker Carter, you're recognized. Thank
Representative Davy Carter
Unverified
0:07
you, Mr. Chair. Thank you, members of the committee. It's an honor to be here today. I'll keep this short and sweet. We've gone through halftime. We're at halftime of this session, and the third quarter starts today. And I'm here, Mr. Chair, to respectfully ask the members of this committee to begin your deliberations regarding tax cuts and tax reform.
And I'm asking all of you today to begin that process. And within that process, you all have a great responsibility to make sure that we pass reasonable tax measures out of this committee. There are over $2 billion worth of tax cut bills that have been filed. They all cannot reach the House floor.
That begins and ends in this committee. I have all the confidence in the world in the chairman and the vice chairman and all of you sitting around the table. To that end, Mr. Chairman, I'm asking that the committee begin deliberations on your tax cut package in the total amount of $150 million. dollars I would like for you to prioritize these in the following way
50 million dollar package one 25 million dollar increments thereafter and as we begin negotiating and going through the process that's what I'm asking to see on the house floor in addition and separate to that mr. chair I'm asking for some consideration to be given to a capital gains cut in the context of the health care debate
that is ongoing regarding Medicaid. I appreciate the opportunity to be here, and I appreciate your hard work. So, Mr. Chair, time to go to work. Thank
you very much, Mr. Speaker. All right, I'll give everybody an opportunity for that to sink in. And the good
news is, as you know, we've started thinking about a lot of these issues up until this point,
and we're going to be working closely with colleagues outside of the committee as well as our colleagues in the Senate to make sure as we put together these packages
that we've got smart plans to move forward with. So obviously a lot of work yet to come, but I think it's exciting to know that we're going to be focused on helping the people of Arkansas and reducing
the tax burden this significantly in this session. All right, the first bill on our agenda is HB 1041.
I see Representative Westerman here. Sir, would you like to present your bill? Yes, Mr. Chairman. You're recognized to do so. Thank you, Mr. Chairman.
Representative Bruce Westerman
Unverified
4:00
This is an amendment to the bill that I would like to run. I'm not sure
if Eden has passed that out or sent it to the electronic devices. Give
everybody a minute to pull that up.
And just to update the committee, I did a member's own amendment on this bill that clarified some issues that were brought up when the bill was presented in committee. The main issue was whether the revenue growth cap or the expenditure growth cap was on net general revenues for expenditure or gross general revenues for expenditure
and the the first amendment specified that it is on net general revenues for expenditure one thing that that does is it removes all of the off-the-top money from being under the cap that is the area where general obligation bonds are are paid from so there was questions about would this bill affect affect the ability to do amendment 82 projects it would have no impact on that because those funds to pay those general obligation bonds come from the off-the-top
money the bill also clarified some language regarding emergency expenditures and I've got the amendment that you have in front of you now this is a I won't say a huge change but it is a pretty good change from the original amendment I've often heard that iron sharpens iron and through this process I've been able to visit with a
lot of people and get a lot of feedback on this bill and I believe this amendment that I will present to you today makes this bill even better better for the state of Arkansas and better for the taxpayers of Arkansas. What this amendment basically does is that in the original bill, it had the growth in expenditures capped at a hard 3% or the growth in the gross domestic product for the state over three years. To me, as
a naturally conservative individual. A 3% cap seemed like plenty of money for us to run our operation, to grow the government each year. It's approximately the rate of inflation, actually a little bit more than the change in the consumer price index that we've seen over the past few years. But it is a hard cap, and it doesn't lend a lot of flexibility, and it doesn't lend or give any incentive for the state to try to promote the growth of the economy
since there's no benefit for the state if it grew over 3%. In doing a lot of research, the National Council of State Legislators, NCSL, that I believe everybody here is a member of, did a paper on state expenditure caps that was published in 2010. There are 37 states that currently have an expenditure cap, and nearly 30 of those, or there are 37 that control expenditures.
Nine of them do it with restrictions on revenue, and the rest of them do it with restrictions on expenditures. And in reading this very well done research paper, I found that the overwhelming indicator or metric that was used to measure growth in expenditures was personal income, total personal income. So I went back and did a lot of number crunching, looked at how that would affect Arkansas and
the growth rate, and I've got this amendment before you today that removes the hard cap, it removes the three-year average GDP, and it puts the expenditure growth cap based on a five-year average of the state's disposable personal income. Now, the state's total disposable personal income is a number that we can get from the Bureau of Economic Analysis. One of the objections that was raised by DF&A was
that they would have to calculate the GDP numbers, but since B, the Bureau of Economic Analysis, publishes end-of-year disposable personal income data, we no longer would have to rely on DF&A or any of their estimates to get this number. We could use the direct end-of-year annual numbers from the United States Bureau of Economic Analysis to determine what our growth rate cap would be.
I think this does a couple of things. Number one, it removes the hard cap. And when we're talking about disposable personal income, that is income after taxes. so we're talking about the money that people of Arkansas have in their pockets to spend after they pay taxes and what I believe this message sends to the people of Arkansas is that if you don't have money to spend then we're not going to spend money and it gives us an incentive as a state
to put more disposable income in the pockets of Arkansas taxpayers I believe this is a great indicator and I believe it works both ways I think this will allow us to responsibly control the growth of government spending it's a much simpler method of doing the calculation and I believe that if we pass this we can be leaders in the country even more so than what we are now with our Revenue Stabilization Act I
believe this will greatly enhance our Revenue Stabilization Act and our whole budgeting process by using this growth rate on disposable personal income to cap our expenditures the amendment also removes expenditures in GIF from the cap which according to legislative research that's not totally necessary but just clarification I wanted to put that in there and it also removes any kind of
special claims against the state from the revenue cap and I'll take any questions well let me say this if we the bill is set to go into effect July 1st 2014 using the data that's available now the growth rate for this year would be three point eight percent now if we were to do next year's budget based on this bill which some has suggested if we pass this bill we should be good stewards
and go ahead and budget accordingly the governor's proposed budget is a four point six percent increase we only need to take about thirty two million dollars out of the governor's proposed budget I think there's a very easy way to do that We can use one-time surplus money to put in the Medicaid Trust Fund. DHS has $102 million currently in the governor's proposed budget. We could drop that back to $72 million without inflating the baseline budget,
put the surplus in the Medicaid Trust Fund and be below this 3.8% level if we wanted to follow this budgeting scheme this year. And with that, I'll take any questions. Representative Bragg you're recognized for
a question one of the concerns
Chair
Unverified
12:47
that has been shared with me is his effect on K through 12 education and I know that's it you know about a statute is there
Representative Ken Bragg
Unverified
12:56
any concern that this would affect
Representative Bruce Westerman
Unverified
12:59
that the adequacy amount for k-12 education this year is 2.5 percent about forty nine million dollars well under a three point eight percent amount so I've heard that argument too but I think when that arguments made you have to look at the percentages through the the 2.5 percent actually under the three-year GDP average too so now I don't believe that's a valid argument representative Bragg
we're taking questions on the amendment and what the amendment does do
is change the measure of target and so things that have to do with the measure and the target I think are relative relevant to the amendment but we're gonna have to vote on
the amendment before we then talk about the bill as amended so as long as we're still on questions
Representative Stephen Meeks
Unverified
13:53
on the amendment representative Meeks thank you mr. chairman a question I have is a total state disposable personal income. Is that definition a hard definition? Is it included? Is that something
that somebody could come and monkey with that definition? That's a great question. That's
Representative Bruce Westerman
Unverified
14:08
a number published by the U.S. Bureau of Economic Analysis. There's a definition for what that number is, and they publish the number, so it's not something that we as a state would have any control over how that number gets published. Okay, so that's coming from an outside source, then, an independent source. All right.
Representative Stephen Meeks
Unverified
14:25
I appreciate that. Thank you. Thank you, Mr. Chairman. Representative Kerr, you're recognized for a question.
Representative Allen Kerr
Unverified
14:34
I just have a motion at the proper time, Mr. Chair.
Okay. Do we have any other questions? Representative Kerr, you're recognized for a motion. Motion
do pass on the amendment. We have a motion to adopt the amendment. Do pass. All in favor? Excuse me, just to adopt the amendment? Motion to adopt the amendment, yes.
All right. We have a motion. All in favor? Aye. Those opposed? No. The ayes have it. Representative Westerman, your amendment's adopted. We'll now move to discussing the bill as amended.
Representative Bruce Westerman
Unverified
15:23
Thank you, Mr. Chair. we spent about an hour and a half discussing this bill before it passed the first
time and went to the House floor I think I've explained the amendment I'll be happy to take any questions
that you have about the bill representative Westerman I have a
question on the bill and and here's my question can you walk me through the difference between how your bill treats ongoing net general revenue compared to how your bill treats surplus funds in the use of spending versus measuring versus the target? And I apologize if you've explained this before. I'm in the slow learner group.
Representative Bruce Westerman
Unverified
16:08
Hopefully I can be in the slow explainer group, but that was a load of question you asked there, Mr. Chairman. The bill affects the net general revenue available for expenditures. It doesn't affect surplus funds. It doesn't affect special revenues or any other kind of revenues. It only affects net general revenues available for expenditure. If you remember the charts that we see in the budget committee where we get the total general revenue,
and then we take off of the top for tax returns, for central services, and all that list of items, then we come away with the net general revenue available for distribution. That's the pot of money that this revenue cap affects. If we had surplus money that has already been budgeted in previous years, that money can be directed however the legislature chooses to direct that money without affecting the baseline budget.
Thank you, Representative Westerman. Representative Thompson, you're recognized for a question. Thank you, Mr. Chair. My question
Representative Tommy Thompson
Unverified
17:29
is, our speaker just sat right where you are, and he gave us some directions asking us to come up with $150 million in tax cuts. How will your bill not only affect that, it wouldn't affect it this year, but how will
affected in 2014 I think that's
Representative Bruce Westerman
Unverified
17:55
an excellent question if we enact spending restraints if we cap the growth of the expenditures that's going to create more surplus funds in future years they can be used for tax cuts can be used for rainy day funds for emergencies if we go down the path we're on right now to spend basically all the revenue that comes in, then the only surplus we get is what's
in the difference between what DF&A projects and their conservative estimate and what actually comes in. Just like this year, we're going to have a surplus of the numbers I've been told are in the $300 to $350 million range. So if we budget even more conservatively, we're going to be able to generate more surpluses that can be used for for tax cuts or or any other purpose that the legislature chooses to direct that money so to answer your question I believe this bill
will greatly enhance our ability to do that in
Chair
Unverified
19:01
the future thank you sir thank you mr. chair does
anyone else on the committee have any questions
Representative Joe Jett
Unverified
19:10
representative Jett you're recognized for a question thank mr. mr. chairman mr. Westman in regards to representative Thompson's question you talk spending constraint cuts are we talking how our education or where are you talking for your constraint cuts coming from well there
Representative Bruce Westerman
Unverified
19:24
there aren't any cuts that's the beauty about this bill last year we had a four billion seven
hundred twenty seven million five hundred thousand dollar budget that's our base going into this year the governor has proposed a four billion nine hundred forty seven thousand or nine hundred forty seven million three hundred thousand dollar budget for fiscal year 13 and 14 if we passed this law and decided to follow the spirit of the law this year and set a Revenue Stabilization Act where our budget was a three point eight percent growth then
we would be at four billion nine hundred fifteen thousand or nine hundred fifteen million three hundred thousand dollar budget which is a hundred and ninety million dollar increase over last year so we're still growing the state government we're just doing it at a controlled pace so education is at two and a half percent the big increase in the governor's proposed budget is in DHS and Medicaid and I believe we can lower that amount by using our surplus
that we have this year responsibly to cover those future Medicaid costs well
Representative Joe Jett
Unverified
20:40
I appreciate that let me let me back up on my question let me take the word cut out of that sentence okay you said spending constraints where are you talking about your
Representative Bruce Westerman
Unverified
20:53
spending constraints when it come from we we kept the budget at 3.8 percent and we go in and prior to prioritize items in the growth area not cutting anything just where we want to let the budget grow I would propose this
year that we instead of growing DHS by 102 million dollars that we grow them by 70 million dollars and we use that 32 million dollars out of existing surplus funds so we keep our baseline budget below the 3.8 percent excuse me for interrupting
Representative Joe Jett
Unverified
21:26
so you're saying that your property property number one would be constrain DHS we're not constraining
Representative Bruce Westerman
Unverified
21:34
DHS if we take 32 million dollars out of the
surplus and put it in the Medicaid trust fund DHS gets the same amount of money it's just not coming out of the revenue the general revenue budget and it
Representative Joe Jett
Unverified
21:48
doesn't ratchet up our baseline for next year but you're talking about one-time money now say going forward what's what's your
Representative Bruce Westerman
Unverified
21:55
prioritize what are you prioritizing going forward I believe it's if we're talking about DHS and Medicaid I believe it's also responsibility of the legislature to get that spending under control in DHS there are also other areas that in the
governor's budget that I don't know if we'll all agree with that are the the best places to increase in spending they've got an increase in the base level there's there are colas in there there's money for growth in other areas as well other than just
the public school fund thank you representative Westerman is it theoretically true that given the surplus that we know will exist this year that we the legislature could choose to fund every one of the spending requests that the that's in the
governor's budget through a combination of surplus revenue and that general revenue and still be within the guidelines of the cap your bill proposes I think it's easily within those realms mr. chairman
Representative Bruce Westerman
Unverified
22:53
so in all terms of actual dollars out the door there could be no change
at all to what the governor's requested and still be within the confines of this bill if
the legislature chose to do it that way I would agree with that yes representative Howes you
recognized for a question thank you mr. chairman represental Westman I've got an email from a very very longtime friend dr. Joel Anderson of UALR he was one of my college professors way back when I was and he posed this question to me and we've been friends over the years K through 12 education is half of the state budget by law it is held harmless from cuts in addition it regularly receives increased
state funding because of the adequacy mandate prison beds are not going to be closed down in health and human services state dollars are used to leverage millions of federal dollars and are not going to be cut those areas are going to soak up three percent and more of the new revenue year after year existing budgets of higher education institutions and a few other areas of state government will have to be cut in order to balance the total state budget I understand his
question to be that by limiting this growth cap that colleges and universities are his concern is that the colleges and universities will take everything over that will lose out because everything over 3% or they're is cut what should I tell him
Representative Bruce Westerman
Unverified
24:42
well I think first you need to be working from the standpoint of what do the numbers say I've got the executive recommendations
for our new budget for 2014 public school fund is a 2.5 percent increase general education fund 3.4 percent increase excuse me a 3.6 percent increase Department of Human Services is a 9 percent increase general government's a 6.6 percent increase what's classified as other funds is a
four point two percent increase if you look at higher education total there is a one point four percent increase and that all comes to a four point four percent increase plus ten million dollars the governor's asked for in a rainy day fund which personally I disagree with having a set-aside rainy day fund I believe there the general revenue allotment fund is our rainy day fund it's where we should hold all of our our excess funds so as I mentioned
before I don't think higher ed is subject to be cut as long as we use our surplus revenue to cover any kind of one one-time expenditures I don't think any any I don't think anybody subject to be cut when we're growing the budget That's the logic that I can't understand, how we're proposing a cap on growth, yet people say we're being cut. Now, I heard an argument over the weekend from an institution of higher ed that they had been cut because the percentage of general revenue wasn't as high as it used to be.
But, in fact, the amount of general revenue they were getting was no lower than they had ever gotten. but because tuition and fees had increased, it made the percentage of general revenue less. Now, maybe I don't see things the way everybody else always does, but in my book it's not a cut when you're getting at least the same amount or more than you got the year before. Thank
you. Representative Wren, you're recognized for a question.
Representative Tommy Wren
Unverified
27:05
Thank you, Mr. Chairman. My question, Representative Westerman, is in response to your answer to Representative Jed's question. When you said that this would be good because it would reasonably put us, it would pace us as far as spending and it would be responsible. So my questionable is, is the Revenue Stabilization Act that we currently have, do you not feel like that we're reasonably paced and that's responsible?
Representative Bruce Westerman
Unverified
27:38
I think we should all be grateful to that group of people back in the 1940s that passed the Revenue Stabilization Act. And in cliché, they kind of saved our bacon through the rough times that we've been through. The Revenue Stabilization Act is a wonderful tool. I don't believe this in any way hurts the Revenue Stabilization Act. We would still have the Revenue Stabilization Act that says we cannot spend more money than we take in. All this would do is say for that excess that we take in, we're not going to spend all of it.
We're going to spend X amount of it in a reasonable manner based on an indicator of how much money the people of Arkansas have in their disposable personal income. So I'm a huge fan of the Revenue Stabilization Act, and we should all be grateful for it, and I believe this will enhance it. And I also believe it will make us a leader in the nation in government budgeting. And I think the side effects of that will be that when companies and industries look to a place to locate,
they will see a very stable, sound budgeting process in Arkansas, which will give that certainty that this is a good place to grow their businesses. Well,
Representative Tommy Wren
Unverified
28:52
I'm glad to hear you say that, because I, too, think that having a Revenue Stabilization Act is responsible. I mean, I don't believe anybody, I live my life, that we shouldn't spend more than we take in. So I guess my question is with those, what we've already got in place, I just don't see how going forward putting a cap on that does anything
if we're not spending more than we're taking in. And we do have
Speaker 18
29:20
things such as rainy day funds and things like that. I guess it's more of the concept, do you want to live
Representative Bruce Westerman
Unverified
29:26
from paycheck to paycheck, if you want to put it in simple terms, or do you want to actually spend what's needed to be spent and not spending it just because it's there? I'm
Representative Tommy Wren
Unverified
29:36
glad to hear you say that, because are we currently living paycheck to paycheck with the surplus that the state has right now? I mean, to me, if we were living paycheck to paycheck, we wouldn't have the surplus that we currently have.
Representative Bruce Westerman
Unverified
29:49
We generate surpluses, and then we turn around and spend those surpluses. So in the big picture, when it all comes out in the wash, we're living paycheck to paycheck.
Okay. All right. Well, thank you. Representative Westerman, let's say that
all of a sudden in Arkansas we had just a boom in terms of the number of people that were getting good jobs and the income level that those people were having. Given the amendment that we've just adopted on your bill where there's no fixed cap
and where the spending tracks to income levels in the
state, let's just say we had a year where incomes were up 8%. What would net gen revenue spending potentially look like in a
Representative Bruce Westerman
Unverified
30:35
year after that kind of income growth? Then it would be permissible to increase net general revenue expenditures by 8%, which, you know, if the people of Arkansas were that wealthy, I think that most people would agree that they could afford more government services.
But that still doesn't mean you would want to spend all of that just because it was available to be spent. I think we have to look at expenditures, not just what can we buy with what we've got, but what do
Speaker 67
31:06
we need. But the cap wouldn't hold us from spending the 8%. There
Representative Bruce Westerman
Unverified
31:09
would be no fixed cap with the current amendment.
Representative Stephen Meeks
Unverified
31:17
Representative Meeks, you recognize for a question. I'm going to take the opposite. Let's say the opposite happens, and we have another recession, depression,
and revenues go down by 5%, 6%. Would that mean we've got to shrink government by that amount? How is that handled in your bill?
Representative Bruce Westerman
Unverified
31:35
The calculations made on a five-year average, If our economy gets so bad that we have a negative total disposable income over a five-year period, then we're going to have much bigger problems than what we do with the state budget. But in theory, if that happened, yes, it would be probably a much-needed decrease in state government spending
if we lost that much total disposable income over a five-year period. So this is going to force
Speaker 18
32:07
us to give us a government that's reasonable in size compared
Representative Stephen Meeks
Unverified
32:10
to our population? I believe so. I believe the scenario you described earlier would
Representative Bruce Westerman
Unverified
32:18
be probably worse than the depression. Thank you. Motion to the proper time. Any other questions from the committee?
Okay. Is there anyone in the audience who would like to speak for or against the bill? Mr. Weiss, you're recognized to speak against the bill. If you'd please introduce yourself and your organization. I thought you were coming to speak for it. Mr. Westerman is
Speaker 71
32:53
confused. He thought he was coming down here to speak for it, Mr. Chairman. I wasn't.
Mr. Chairman, I'm Richard Weiss with the Department of Finance and Administration. I think there have been a whole lot of things said today, but I'd like to just come in and say a few things, if I might. One is we were not handed a copy of this until this morning, so we have seen an amendment we haven't seen in the gross bill. I would love to see the gross bill. That's why I didn't object to you all adopting the amendment. That was the next good next step, but I think it's real important to look at the whole bill TO SEE IF THERE'S ALL THE KINDS OF TECHNICAL ERRORS THAT WE POINTED OUT THE FIRST TIME
AROUND AND MAKE SURE THAT THOSE ARE CORRECTED. AND I THINK THAT THAT OUGHT TO COME BEFORE YOU VOTE A BILL OUT. SECONDLY, I'D LIKE TO CLEAR UP A FEW MISCONCEPTIONS, IF I COULD. IT'S TRUE THAT WE ARE EXPECTING ABOUT A $300 MILLION SURPLUS IN THE AGGREGATE THIS YEAR. BUT WHERE DID THAT $300 MILLION COME FROM? IT CAME FROM COLLECTIONS MADE EVER SINCE THE LAST REGULAR SESSION. that's not a one-year surplus this year the economy is doing better than we expected it to back in May when we made the forecast and we've come to the
committee and said we expect the economy to produce a hundred million dollars more so the three hundred million dollar number that you're looking at is not a magic number that appears each and every year some years we have had very little surplus this year as we've come out the last really the last two years as we've started to come out of the reception but the recession the surplus has indeed gotten better because our revenue stabilization law has kept the expenditures down again I'd point out that our revenue stabilization law made
us one of the five states in the nation in the last couple of years who did not go belly up during the recession we did a darn good job of managing what we had Now, because we had that recession, several things happened that put some one-time money into expenditures. The biggest one, of course, was the ARA stimulus money that put a lot of money into Medicaid. It changed the amount of match that the state used for Medicaid to the tune of, I don't know what the tune was,
But the net effect was when we came in to formulate the 2014 budget in the governor's balanced budget, he said, yes, we need $90 million in Medicaid to cover that gap, plus we need another $70 million each year out of one-time money to fill that bucket up. And at that point, he said, we're still going to have a shortfall in Medicaid, and I believe all of you who were paying attention in November knew that. so that that's where a big chunk of money growth came from the other big
chunk came in the Department of Corrections where the governor had used virtually all of the rainy day funds that you all gave them authority to use to get them out of a out of a big hole that they had dug in so as a result in the balance budget we brought in November I mean we don't have the luxury of just saying well we're just going to take a percentage and not really do the hard hard heavy lifting of building a budget based on the needs of the state based on the all these services that are provided but just say well we're going
to take a percent cut and go home and go to bed it's not that easy guys it is a very complicated process of developing a budget to provide all the services in the state to match that to the kind of income that's going to come into the state and that's where we are now I would be glad to take any questions you have I've got a one more thing I would like to just talk about and I can certainly give the committee this but there's a annual change of what we have
actually taken in general revenue or done in general revenue expenditures over a 10 12 year period and it has ranged from a minus 1.8 percent or a minus 3.6 percent in 2010 when the economy was really in the tank to a seven percent growth in 2004 but what has smoothed all that out is when we budget we budget according to a forecast we have the ability to make corrections downwards if
the revenues come in below that forecast which we have done several times we did it I believe in 2010 just a couple years ago we revised the budget downwards to come with any expenditures so there is a constant management going on with the whole budget process we've had we've had generally speaking and mr. Westerman has complimented us I think on this we have been very conservative in our forecasts
resulting in a very conservative budget for the site and that's what has created some surpluses the surpluses don't go to blow up government and make it bigger in most cases it goes for one-time construction needs throughout the state a lot of that has gone to the institutions of higher education which are here a lot of them are here today so it's not somehow or other blowing up government to some controllable measure but but instead is very wisely kept us
on an even keel and provided some surplus funds for capital improvements again we have not seen the amendment until this morning I would ask the committee to let us have some time to digest it and to look at it for technical problems and come and give you some some more to the point testimony which we cannot do that we hadn't seen this I'll
be glad to Mr. Weiss, I have a question.
You mentioned the ARRA stimulus and its impact on Medicaid.
Is it about accurate that that added about 10 percentage points to the federal reimbursement rate from something in the low 70s to something in the low 80s for a period of two or three years? Am I
Speaker 71
39:12
about right with that? You're about right. Yeah, it changed the match rate that we had by probably not quite that much, but that helped tremendously. Thank you. There were a lot of folks in Arkansas and around the nation who, I think, needed those services so they wouldn't be kicked out of the nursing homes and all the other things that Medicaid does for them.
And I understand and agree with you that that created a big challenge for budgeting when that stimulus money went away
Speaker 71
39:40
and was no longer able to fund Medicaid. Absolutely. But my point, I guess, and that is that we have, through the budget we presented in November, again, doing the heavy lifting and going through each and every thing out there that the state government does, came up with a way to
manage that. Yes, sir. Representative Lee, you're recognized
Speaker 76
40:03
for a question. Thank you, Mr. Chairman. It appears today the Oscar winner here at the Arkansas Legislature is the RSA. We're all a big fan of it.
As it should be. As it should be. I agree. Would you tell me which state agencies in – can you hear me? You look like you're looking for it. I'm half deaf, Ms. Lee, but I can hear you. I'm rarely told people can't hear me, so I was just going to make sure. Remind me, this year in the governor's proposed budget, which agencies were cut? I do
Speaker 71
40:41
not believe any agencies had a negative, but let me just check real quick.
And the reason for that is that the governor recommended a COLA for state employees, and that is virtually the only thing that increased budgets in a lot of agencies. Okay, so no
Speaker 79
40:57
state agency took a cut this year in the governor's proposed budget. No, and I'll tell
Speaker 71
41:01
you why, because the agencies, by and large, have been flat or more than flat for the last five or six years. Thank you. And the coal
Speaker 76
41:11
is separate. What the governor is wanting to present is going to be separate money. I mean, it's going to be built in.
Speaker 71
41:18
That was built in the balance budget, yes, against each one of the agencies.
Speaker 76
41:22
Okay. Thank you. Thank you, Mr. Chairman.
Are there any other questions for Mr. Weiss? Representative Armstrong. like
Speaker 83
41:38
proper time okay substitute motion you're right
representative meeks I'm sorry yeah yeah are there any questions for mr. Weiss
no questions for mr. Weiss all right thank you do
Speaker 71
41:54
you want to say something if I could do one follow-up on Miss Lee's question I apologize for coming in but I was just looking down through the list here youth services and human services even though we added money for colas and still a zero percent change from last year so effectively you can say that was a budget cut there are a lot of agencies who are down down below the amount that budget the cola would have been
Chair
Unverified
42:28
Is there anybody else that would like to speak for? Are you finished, Mr. Weiss? I'm sorry. I was visiting with Mr. Westman.
Speaker 49
42:40
This is my first opportunity to visit with him, sir. Well, yeah, I
mean, you guys are welcome to spend a lot of time together. You can use my office if you'd like. Is there anyone else that would like to speak? Do you have more to say on this bill, sir? No, sir. Okay. Is there anyone else that would like to speak for or against the bill?
I don't see any hands representative Westerman would you like to
Representative Bruce Westerman
Unverified
43:08
close for your bill yes mr. chairman and to address the concerns that the director
had with the FNA not having comment on the amendment shortly after the first meeting I approached mr. leathers and told him that I would be willing to meet with the FNA and work out any technical issues. We never had a meeting. I assume that with the
governor proposing this bill so much that we weren't going to have a meeting. I've worked very closely with the attorneys in legislative research. They are quite confident of their job and the work that they've done on this. So I think we've got the technical issues, if there were any technical issues, worked out in the bill. Again, I believe this is a good bill. that will make Arkansas a leader in the country, not in the top five, but maybe the top in the country in budgeting
and having responsible management of our state budget. And I would appreciate a good vote. Representative Meeks, you're recognized for a motion. Thank you,
Representative Stephen Meeks
Unverified
44:14
Mr. Chairman. I move do pass as amended.
The motion is do pass as amended. All in favor? All opposed? the ayes
have it I see two hands for a roll kill please call the roll
Speaker 92
44:35
representative Baird representative Baird representative Lee representative Lee votes I representative Carter representative Carter Representative Kerr, Representative Alts, Representative Meeks, Representative Gene, Representative Wren, Representative Westerman,
Representative Bell, Representative Thompson, representative house representative Copenhaven representative Alexander representative Alexander representative Armstrong representative bragg representative Hudson representative Mitchison
representative Gossage Mr. Westermann, your bill is passed. Thank you, Mr. Chairman. Thank you, Committee. All right. The next bill on our agenda is 1206. I'm sorry. Representative House?
Mr. Chairman, point of order. Mr. Armstrong requested a motion, and I'm not sure that the chair called on him for that. Excuse me? Representative Armstrong was recognized to make a substitute motion. I didn't recognize him to
make a substitute motion. Thank you very much.
Just point of order. Thank you. All right. The next bill on our list is HB1206. I Don't see representative Lowry the next bill is one two
One eight which is on a member's own amendment the next bill we've got is HB 1461 representative links bill and I think representative gene is going to present the bill Representative gene your recognized present the bill Representative Gene,
you're recognized to present the bill, and if Mr. Tice is going
to speak alongside you, when you speak, Mr. Tice, if you'd just state your name and who
Speaker 99
47:35
you're with for the record. Thank you, Mr. Chairman. This is Kelly Link's
Representative Lane Jean
Unverified
47:39
bill, Representative Kelly Link. He's at a public health, had some votes there today, asked me to run it. It's a clarification on effective dates for catalog sales and make technical corrections. And I've got John Tice with me with DF&A to explain the bill.
John Tice
Unverified
47:59
Mr. Chair, committee members, my name is John Tice. I'm with the Department of Finance and Administration. Several years ago, Arkansas made a decision through legislation to become a member of the streamlined sales tax project. When we became a part of that project, our laws were amended to be as uniform as it could possibly be with other streamlined member states. The purpose of joining that group was to try to encourage federal legislation that would allow states to collect sales tax on remote sales, internet and catalog type sales.
There actually is a bill currently pending before the U.S. Congress for that purpose, sponsored in part by a couple of Arkansas senators and representatives. and every year the streamlined organization reviews the Arkansas laws to make sure that we maintain that uniformity with other states a couple of minor issues have been pointed out in the most recent review of Arkansas representative link is the Arkansas legislative member of that streamlined group he represents the General Assembly on that group which is why he's bringing
this bill and it corrects the the two errors one with our effective date when catalog sales are when tax changes are effective for catalog sellers and then another is a minor reference to a code thank you mr. Tice representative
Jean did you want to add anything no mr. chairman members of the committee are there any questions representative house you recognize for a question okay
representative Curtis you have a question okay does anyone have any questions all right does anyone want to speak for against this bill representative Jean are you closed for the bill yes mr. chairman
representative house you're recognized for a motion motion do pass on House bill 1461 all in favor any opposed the ayes have it thank you very much everybody and thank you
Representative Tommy Thompson
Unverified
50:18
committee representative Thompson you're recognized for a question thank you mr. chair when the speaker referenced it he would like to see us come up with 150 million in tax cuts and there's been as I understand it 2 billion proposed I heard him say that. Can we get a spreadsheet prepared that will give us some guidelines as to where that money, what proposals are, have been submitted?
The answer to your question is yes. What I want to do, Representative Thompson, is get two spreadsheets
prepared, one which will set up the Senate bills, one which will do the House bills, And then I think we all need to recognize that not all the bills have been filed. So there will be, you know, there will be some things that aren't on there. But I think what you're looking, what you're asking for is absolutely right on. Right. It
Speaker 54
51:17
will just save us a lot of time from having to read through each bill and then get a
Speaker 108
51:23
revenue impact statement on each bill if we could get that in a summary form to use.
Yes. No, I think that's a great idea, and we will do that. And as soon as Eden can get that done, I'll ask her to send it to all the members of the committee via electronic mail, if that works for everybody. Thank you, sir. All right. Thank you very much. All right, everybody, can I get a motion to adjourn, please? We're adjourned.
Agenda
Documents
No documents posted.
Speakers
Representative Charlie Collins Chair
Unverified
Representative Davy Carter
Unverified
Representative Bruce Westerman
Unverified
Chair
Unverified
Representative Ken Bragg
Unverified
Representative Stephen Meeks
Unverified
Representative Allen Kerr
Unverified
Representative Tommy Thompson
Unverified
Representative Joe Jett
Unverified
Representative Douglas House Chair
Unverified
Representative Tommy Wren
Unverified
Speaker 18
Speaker 67
Speaker 71
Speaker 76
Speaker 79
Speaker 82
Speaker 83
Speaker 49
Speaker 92
Speaker 99
Representative Lane Jean
Unverified
John Tice
Unverified
Speaker 54
Speaker 108