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- October 2, 2026
Members welcome thank you for being here today I wish all of you would have been on time. I've been sitting here waiting to start this meeting but I see we're all here now it's very good. all right do we have any words from our co-chair all good. right we will go ahead and jump right into item B.
Speaker 5
7:16
thank you madam Chair. Item B is on page three. this is
Chair
Unverified
7:19
a review item from the department of Parks Heritage and tourism the department is asking to surrender three administrative
coordinator positions at grade SGSO4 in return for one park superintendent3 at SGSo91 maintenance supervisor expert at SGSO6 and one park manager at a SGS11. These three positions will be utilized at the Blanchard Springs State Park the expected cost of the three positions once filled is roughly $264,000 that includes match this is paid by special revenues from conservation tax funding since this is a 3 for3 swap there is no increase in the total number of positions at the
agency. OPm has recommended the requested swap are there
any questions on this item? all right seeing no questions do I have a motion for review a motion in a second2 any discussion all those in favor please say aye all opposed no motion carries item C.
Speaker 5
8:22
madam chairir, both items CNd require a motion to approve.
Chair
Unverified
8:27
These are approval items. Item C beginning on page nine is a request from the department of commerce and the department of Veterans affairs to approve special compensation and recruitment incentive plans the department of commerce is requesting approval of their plan to provide lump sum bonus awards up to5,000 dollars for employees in the classifications listed on pages 11 and 12 that have successfully completed major milestones in transitioning the current unemployment insurance computer programs away from the old mainframe system to the new cloud-based structure. there are
several titles of employees from the office of state state Technology they're also included in the list based on their participation and contributions to the project the estimated cost of these bonuses will be roughly $105,000. The Department of Veterans affairs on page 13 is requesting approval of their plan to provide special compensation and recruiting bonuses to certified nursing assistants working at the Fayetteville and NorthleRock State Veterans homes the bonuses would be paid to all current and new CAs taking a position with the agency. eachach employee
would receive a $2000 bonus. new employees would receive new employees would receive partial payment upon their hiring and the remaining portion upon their one year anniversary. the cost of the department is estimated to be about $100,000. madam chair that is onC. all right senator dotson
you are recognized for a question in just a second you are oh Thank you madam chair
Senator Jim Dotson
Unverified
10:01
tony you might be able to answer this or or K I'm not sure but on these are these extra expenses part of this fiscal year one time only bonuses and are they within the current budget? Yesir. Ka barnhill OPm these are one time payments and they
Speaker 19
10:32
they're one time they're not continuing they're not built into the base and the agency has to have the funding to be able to award them so it's
Senator Jim Dotson
Unverified
10:40
all within their current funding model thank you right any other questions seeing
none do I have a motion for approval and as a motion in a second any discussion all those in favor please say aye all opposed no motion carries itemd.
Speaker 5
11:02
thank you madam Chairman. Itemd on page 17
Chair
Unverified
11:06
is a request from the department of healthalth to approve the reinstatement of a position that was previously frozen due to Act796, approval of the request will allow the department's state medical board to utilize the listed fiscal support manager. This request is required by Arkansas code 215226. The position will be responsible for oversight of the licensing section manager and the credentialing section manager because this position is already authorized in the appropriation bill the agency is not growing the total number of positions the estimated cost of filling
the position is to be about70,000 dollars in salary with an additional $28,000 in match. are there any questions
on item d? all right seeing none do I have a motion for approval? have a motion do have a second? Second, any discussion? all those in favor please say aye all opposed no itemd carries or the
eye's have it sorry madam chairman items E through K
Chair
Unverified
12:04
are reports that require no action however there is one reduction in force this is provided by the department of commerce the division of workforce Services for the elimination of 26 employees the letters from the department referenced27 employees however it has been relayed to us that one of the employees has already been put into another position commerce has also added that none of the employees will receive severance due to a lack of necessary funding the position's eliminated come from the division of workforce services or excuse me services
for the blind as well as employment and training division. I'll get
to you in just one second Representative Bentley I I would like to go ahead and call Secretary Hugh Mcdonald up to talk about item E. I've been getting some questions I know in my district and I think it would be good for us to hear what's going on with that andpresentative Bentley do you have a question for the secretary? OK, OK perfect. right. I'll let's oh great
if you would please introduce yourself for the record. Good afternoon
Speaker 29
13:12
Hughmcdonald, Secretary of Commerce and my colleague Cody Waits executive director Workforce Connection if you
of information about what's going on and and why we landed here Sure bottom line
Hugh Mcdonald
Unverified
13:28
with both of the riffs is as you may recall we did a realignment
a couple of years ago streamlining some operations and for for employment and training we really ultimately determined that we had number one in the Wagnereiser area it was it's it's a federal funding for workforce workforce training support and it's always been a very lean funding and we've always had a difficulty in terms of I guess it's always been crosss subsidized by other funds and
with the realignment we realized that it was cross subsidized in a pretty significant way and we also found out that we just had too many people and not enough that supported not enough work so from that perspective that's where the 10 FEs happened and division of services for the blind a lot of it is just performancebased failure to manage operational costs based on available funds and had to take some pretty quick
action from that perspective can you speak at
all specifically to communications that you or your department have had with the feds on this yes yes, I
Hugh Mcdonald
Unverified
14:55
certainly can in fact I was on the phone just this morning with my chief of staff and to the on the phone with a the acting head of RSA in Washington and
you know in his words these are his words but DSB
he said has been mismanaged for a long time and
we should have taken action you know a long time ago.
so yeah we've had a number of communications with RSA Mr Waits is having them routinely to reestablish the funding we still don't have the funding yet
which is why you know fi156dSb employees are still on furlough. right thank you senator Love, you're
recognized thank you madam so help me understand this so
Senator Fredrick J. Love
Unverified
15:56
the division services for the blind did the did the
funding just go away or or we just we're just cutting the that division I mean walk me
through that did they cut the funding or or do we still have the funding
Hugh Mcdonald
Unverified
16:16
let me and and let me read you some language that came directly
from the from the federal RsA which is very clear we received this communication February 25th it's a DSB received notice from rehabilitation services this is the office of Special Education and rehab Services in the uni US Department of Education that RSA has been designated has designateddSB as a highrisk grantee.
pretty significant pretty long letter and a few additional excerpts I'll read to you. I I then took this letter that we got from RSA and I communicated it to the entire DSb board we were not we had no idea whether or not the DSb board was aware of this but the letter goes on to say this notice recountsdSP's excessive spending in
administrative costs and draw down patterns that correlate to dwindling carryover amounts which resulted in DSP obligating or expending all of its award funds The data makes clear that DSB has fiscal data that projected the financial difficulties it has encountered. however, DSP did not take steps necessary to continue to operate the programs in accordance with the assurances made for receipt of the federal funds lack of fiscal planning and
oversight raises serious questions as to DSB's ability to effectively manage and administer the Vr program. They go on to say that it's not a current year fiscal problem but it dates back to at least 202 the the number of participants increased by 18% from 20 to24 while the total expenditures for VAVR purchase services increased by78%. and said the DSB also did not communicate to RSa
of any fiscal planning cost containment measures or strategies implemented by DSB to mitigate the effect that a lack of fiscal resources would have on Vr programs so we really had to take immediate action with the with the riff to to effectively get the train back on the tracks and we're still not there yet because we've we've yet to get the funding from
Rsa in Washington we're communicating with them or attempting to communicate with the DSB board chair here in Arkansas to get the right leader in place, the new leader in place in DSB that will bring a new fresh perspective on how to run the division ok so so are you saying that the the the the
Senator Fredrick J. Love
Unverified
19:11
people that you all are laying off would they
be able to once you kind of that's right to you you're you're you're you're
saying that this is a reduction of force is just going to be a permanent this is
Speaker 47
19:26
it will be it will be permanent yes let
Senator Fredrick J. Love
Unverified
19:30
me ask you this just based on just based on cause here's what I'm hearing in my community when we when we talk about reductions and forces that usually follow on African Americans. I'm just this is what I'm gonna ask you do we look at the percentage of of African Americans that you're cutting in I mean I just wanna I want to
Hugh Mcdonald
Unverified
19:56
mean it's it's it we we don't look at that from a pers it was performancebas from our perspective. Mr Waits might be able to get into the detail on that but I
couldn't tell you you know what the 17 employees you know what race any of them are ok so I'm I'm just gonna tell you Secretary Mcdonald
Senator Fredrick J. Love
Unverified
20:16
when I hear when I look at and and I'm I'm pretty sure that you may have heard some of
this you may not have but when we begin to look at the reduction in forces and when they fall heavily on you know when they say hey you know the reduction of forces at the federal level and we look at the African American community and most of it is is hidden there and then you look at it and it's not to say that I'm not I'm not concerned with any other race. I'm just saying when it's disproportionately affecting Africanmerics then we have to be at least aware of
cognizant of how it of how it may appear and so that's what that that's the only reason I asked that question and then lastly when you when do you see you appointing or getting someone new in there in the services getting back up and going or the services continuing as we speak now.
Hugh Mcdonald
Unverified
21:16
The services are not continuing because the funding has not been provided by the RSA because we do not have an interim leader. The governor has
named an interim leader and we' re trying to get the DSP board to agree with that. They recommended the DSB board actually recommended an internal person with DSB and while I don't have a lot of history in the details of DSB I do have a lot of history of fixing broken organizations and we have to bring somebody in from the outside with a new perspective to fix this organization and that's our recommendation and
the governor agrees with it. OK. all right thank you madam Chair I I
Senator Fredrick J. Love
Unverified
22:01
may get back in the queue for for a few more questions but thank
you that sounds good I mean what what I heard you say Secretary Mcdonald when you read that letter is not that you guys just did a riff and let go of
17 employees it's that after repeated warning, repeatedly being told do not spend money you don't have. do not spend down your funds they continue to spend down funds and it was they basically did this to themselves
by forcing the issue much quicker because they didn't heed warning. they continue to spend money they should not have been spending and that led to a writh is that a correct understanding over obligated funds they were
Hugh Mcdonald
Unverified
22:40
expecting to get in the future when the when the federal funds didn't happen they were way over obligated thank you I just wanted to to help
make that clarification that's what I understood senator Love no one else is in the cus so you can hop back in if you'd like and just
Senator Fredrick J. Love
Unverified
22:56
just a few more so is the DSB board
who who is the DSP board or who who is this division run by like why why is it that we are we're now catching this and we didn't catch it two years ago or four years ago like what what was like who was in control of this runaway
Hugh Mcdonald
Unverified
23:19
train? it's a good question and it's something we need to fix. is well I guess
Senator Fredrick J. Love
Unverified
23:24
I'm saying is is the the DSB board is that part and parcel is that is that governors appointees is that like
I'm just trying to get this because this it's part of workforce isn't it it's part of the
workforce connections OK so so then who who was who was over this
Hugh Mcdonald
Unverified
23:49
director that that has run away that has
this runaway spending well that's this has been an ongoing conversation that this DSB is the board is independent and we have some disagreement about how independent that board is
and we can there
there is the the per statute the position of the DSB director reports to the secretary of
commerce. and I've delegated that to to Mr Waits but but there is on the other hand the statute also says d S b board shall appoint
the DSB director upon a subject to the approval of the governor so there's there's a there's an inherent problem there and we're seeing the results of it right now and so even
Senator Fredrick J. Love
Unverified
24:57
though this this letter's now coming to light we've had previous communications with the director of this
this division and they just continued to overspend and people continue
Hugh Mcdonald
Unverified
25:16
to it came it came mostly very much to light to our fiscal
operations in November of last year when we realized that they were over obligating funds the instructions at that time were to no deobligate as much funds as you could and none
of that happened so we wound up furloughing a second time and the employees are still furloughed today how much of this was communicated to the DSB boardard. I can't tell you so we still
Senator Fredrick J. Love
Unverified
25:57
have employees furloughed employeesur out of this whole division
is is is is56 employees out of the entire divisions there's there's I believe there's5 how many employees are
Speaker 61
26:10
not of the OIB group yeah there's5 employees that are part of the older
Speaker 63
26:15
individuals with blind group that are still currently employed and working because their grant funds were not over obligated so the way that they come from the federal level there's a there's a bigger bucket of funds that comes in and there's a smaller piece specific to the older individuals are blind so there's5 individuals that are still employed and working and then there's56 that have been furloughed. and so out of the56
Senator Fredrick J. Love
Unverified
26:37
we have just5 that are just kind of in operation
and then and then the reduction of force for this division is can you tell me how many that is so then you'll have the the remainder coming back on to to work
once we get the funding back in is that all56 I mean if we
Hugh Mcdonald
Unverified
27:01
got the if we got the funds today all56 would come back 17 would be released March31st the 17th that are on the riff list.
OK all right thank you thank you thank you senator Love so I think it sounds like maybe one way to ask that question is not who are they accountable to but who do they believe they are accountable to and it sounds like I'm hearing they believe they're independent possibly and not really don't really answer to anyone but themselves that they're sort of standalone they picked the director and then they can do what they want is that correct
Hugh Mcdonald
Unverified
27:40
they recommend their their director to the governor
and then I'm I ' m curious do you have any examples of some of the spending that they've been doing to over
Hugh Mcdonald
Unverified
27:55
obligate those funds don't have I don't have the specifics in front of me but we can certainly get that
if you'd like yes that would be great we can circle back around to that. Senator Mark Johnson, you're recognized for a question thank you madam chairir appreciate
Senator Mark Johnson
Unverified
28:09
the opportunity to ask a question though I'm not a member of the subcommittee Mr Secretary Mr Whites thank you
for presenting this this is a follow up on Senator Love's question earlier would it be possible for y'all to provide the committee just me I the committee might want to know it too if the racial composition of the entire universe of employees there and then the breakout of the of the rf just to ensure that nothing untoward or unfair is being done that I know that that has probably has nothing to do with any of of their the racial composition and or
seniority or I don't know what that is but if you could just provide us with that data so we can clear our minds that there's nothing untoward going on on we'd be happy to senator and appreciate Senator Love asking that question I appreciate you providing thank you thank you madam chair
thank you senator Johnson senator Love, I will recognize you again for a question thank you madam chair
Senator Fredrick J. Love
Unverified
29:14
for your indulgence and thank you Senator Johnson for that
because now I did not want to imply anything that nefarious. so I didn't that's not ok but secondly also we talked about statutorily now statutorily means that the legislature gave the board permission to I guess operate in the way they're operating. I mean is that am I am I incorrect with that assertion?
statutorily like like this they're operating within the statute. the thing about it is is that the statute is in in conflict with what the executive is saying is that is that what you're is that what you're telling me? so statutorily who are they supposed to answer to I believe they think they answer to the
Hugh Mcdonald
Unverified
30:10
governor. I mean I'll just read you I mean
and I'm not a lawyer but it says the board shall employ a commissioner subject to the
approval of the governor qualified by experience to administer and implement the policies and directives of the board the commissioner of the board of the division of the DSP shall report to the secretary of the department of
commerce yeah so you can see it's potentially a potential problem all right
op potential let's actual you and were
they moved under commerce during transformation weren't they at Department of Health or and so in the
that in 2019 they were removed under commerce and so you know I think there's a you know some differences of opinions on on who answers to and and I think that's typical with something like transformation. I don't think this is a standalone
situation where there's maybe disagreement on who answers to whom but thank you for clarifying that and answering our questions I don't see anyone else in the queue so thank you very much ok and all we've got a few other reports if anyone these do not need to be approved but if anybody has any questions or anything like that I'm happy to take questions on those all right oh senator Scott, you're recognized.
Senator Jamie Scott
Unverified
31:54
thank you madam chairir. I'm sorry I don't have a question my
apologies OK, no problem uhs representative ladyman you're recognized thank you
Representative Jack Ladyman
Unverified
32:06
madam chairir. I've got a question I'm not sure I was
looking through this report on on the quarterly reports I think it'si hI quarterly employment report
OK what is your question? well I was given time to look it up here but there's two reports here and I'm not clear on what they really are but the first one talks about the quarterly report second quarter 2026 well
that's the last one I guess. p re s ent ative ladyman the two reports
Speaker 83
32:54
of the firstst quarter and the second quarter. it's the same report that did
Chair
Unverified
33:00
not get reported yet for the first quarter and we we had to get it fixed so we had the first quarter coming coming late second quarter was ready so we've put both of them in there what the quarterly employment report is is that tells you the number of state employees the number of positions they have that kind of information it is an average for the three months of those quarters so the numbers you see in there for each agency when you look at the individual agencies those are averages for that agency for that quarter. so is that for three months or 1
month that number that number is for three months it makes it so it's so what you're seeing there is six months' worth of data the
Speaker 5
33:46
first quarter and the second quarter well and it's for both state agencies departments and higher
Representative Jack Ladyman
Unverified
33:52
education yeah I was just looking at the the overtime because we had a discussion this morning and yesterday aboutdd and their shortage of labor and
and people working overtime. So I was looking at that and it looks like we3.6 4 million was the total for overtime for that quarter 1.7 million of that was DHS and 1.1 million of it was the Department of Correction 06 million was Department of Transportation so those three departments accounted for
almost all of the overtime is there anybody looking to see why we're spending so much time on overtime in these three areas with the department of transportation I understand but the other two right I believe Ka barnhill if you
would answer that for us that'd be great thank you yes ma'am yes we are looking
Speaker 21
35:01
at overtime expenditures. Department oforrection has historically always had the most overtime because of their need
Speaker 19
35:11
to keep the facility 24/7 umddS and other institutional places also are the second in line with the most overtime at that particular point in time we are looking at some potential changes in our time and leave practices that might help us do better workforce planning to make sure that we say if somebody called in sick and they weren't going to come into the ship we might be able to go down to another list of somebody who hadn't worked40 hours already and bring them in to work but that's in the that's in the future that's not going on right
Representative Jack Ladyman
Unverified
35:43
now but that's what we're looking at doing but you you just said
the department oforrection is normally number one and DhS#2 but for this quarter DHS is600,000 higher than the department oforrection has that changed
Speaker 19
36:03
yes sir usually correct I mean I'm speaking gene generally usuallysu corrections has the most I did not catch the change
Representative Jack Ladyman
Unverified
36:14
on DHS's at this point there's60 DHS is60% higher than Department of Corrections on this quarter so I mean
what's going on there think it's the
Speaker 19
36:27
need the necessity to provide services at institutional level is what's going on and I think also children and family sometimes has a lot of overtime associated with their positions as well but we know we've talked about it we've had
Representative Jack Ladyman
Unverified
36:41
discussions about you know they shut down the
laborbo part up at Boonville because they didn't have enough people I know one superintendent had to come in at midnight and work a shifts because they
didn't have enough people for direct care. I don't think that's been happening in the
Speaker 92
37:00
past yes well let me tell you something right now all direct care physicians
Speaker 19
37:05
and institutions are totally exempt from the hiring freeze process that means they can hire whenever they need to hire that includes thec andAs, lpns and the RNs and so they have freedom
to hire all the people after our discussions yesterday that we had I've gone back to try to look at the practices and where things may be off kilter and we're gonna work on that I will tell you that since January23rd when the new system went live we've hired 1228 people at DdS so I think we're making inroads but we're I mean I can promise you we will study it and kick back with you with more information right
Senator Fredrick J. Love
Unverified
37:47
Senator Love you're recognized just following up on that when will we have a
report in which we can kind of ascertain if so as as we said corrections is usually the highest and in in that category of spending when will we have a report to say what the pay plan is
kind of went into effect we stated that we were going to be able to hire
more people which should means that we have some sort of reduction in overtime. so when will we have a report that that we can kind of ascertain if that is what's going on or if we're getting worse in overtime we can
Speaker 19
38:32
develop that report we already have some signs based on the state turnover rate which has decreased3% since the pay plan took place. I know the department of or re ction s has hired approximately700 correctional officers since the pape plan has gone in place so you can see that we can see where it's
having positive impact. The overtime could be to several reasons but we'll look at that and see OK. but shouldn't it over time should shouldn't
Senator Fredrick J. Love
Unverified
38:57
I mean with the the increase of new hires shouldn't the overtime also decrease you would think you would think but we will check into that
Speaker 14
39:05
and I think it generally has decreased. I mean I
Speaker 19
39:08
think maybe when he just pointed out corrections didn't have as much this time I think that is due to the high volume of hires that they have had but we will look
into that and look at see you know where the overtime is going what we can do to try to limit that and see what we can find out about'm'm not looking for a drastic
Speaker 104
39:28
increase because I know that that we were shorthanded but
Senator Fredrick J. Love
Unverified
39:31
what I am saying I think we should probably have some sort of reporting data now to to kind of see
if that if it's going in the right direction so we'll be happy to provide that right thank you ma'am thank you madam chair thank youpresentative rose you're recognized thank you madam chairir.
Representative Ryan A. Rose
Unverified
39:50
uhpresentativeladyman just kind of piqued my interest on page 58. so so I understand this correctly the overtime paid is the second quarter that is the amount paid in the second quarter correct? Yes, let me look at this this is this is
tony's report so I'm not as familiar with this let me
Speaker 19
40:08
go find the page. just says Fy26 Q2. I was just making sure that I understood
Representative Ryan A. Rose
Unverified
40:22
correctly these are the overtime amounts paid by division under each department and then located on this paid all page also is the budgeted vacancies and the unbudgeted vacancies is that correct sir OK so we can see divisions or departments who have a large number of vacancies and may also have a large amount of overtime. is that correct? Am I reading that correctly and
do you see any correlation in that across the divisions and departments that those that are understaffed or having to pay more in overtime. I'm sure that is a correlation I haven't had a
Speaker 19
41:08
chance to look at it in great detail but I would believe that would be the case OK all right thank you thank
you senator Hill you're recognized Marhi thinks part of
this overtime that everyone seems to be harping on with the increase
in the salaries that we paid with the increase in that you could even actually have a decrease in in the hours that people are working but with the increase in the pay the overtime is still there so is that that kind of goes hand in hand if you increases someone pay out over time that your dollar amount goes up so I guess I guess I guess my statement iss let's use practical business common sense on this that the hours may be less but with the increased pay they could be overtime there
that is correct sir thank you right I see no one
left in the queue and seeing that there is no other business to take up this meeting is adjourned thank you.
Agenda
A. Call to Order
Item for Review:
B. Request from Arkansas Department of Parks, Heritage, and Tourism, Division of Parks for three (3) positions from the OPM Surrender Pool established by Arkansas Code Annotated §21-5-225(a). (Shea Lewis, Secretary)
Items for Approval:
C. Request from Department of Commerce and Department of Veterans Affairs for administering special compensation awards. (Hugh McDonald, Secretary of Commerce) (Robert A. Ator II, Secretary of Veterans Affairs)
D. Request from Arkansas Department of Health, Arkansas State Medical Board to reinstate a position held pursuant to Act 796 of 2021. (Renee Mallory, Secretary)
Reports:
E. Reduction in Force Report- Department of Commerce.
F. Arkansas Community Correction Quarterly Caseload Report.
G. New March Provisional Report thirteen (13) new positions are approved for four (4) Four-Year Institutions of Higher Education. There are no new positions for Two-Year Institutions of Higher Education. (Department of Education, Division of Higher Education, Dr. Ken Warden)
H. Quarterly Employment Report- First Quarter FY26 State Agencies and Institutions of Higher Education.
I. Quarterly Employment Report- Second Quarter FY26 State Agencies and Institutions of Higher Education.
J. Personnel Actions Report- Office of Personnel Management- Department of Shared Administrative Services. (Leslie Fisken, Secretary)
K. Special Compensation and Recruitment Incentive Award Report.
L. Other business
M. Adjournment
Documents
Speakers
Senator Breanne Davis Chair
Unverified
Speaker 5
Chair
Unverified
Senator Jim Dotson
Unverified
Speaker 18
Speaker 19
Speaker 29
Speaker 31
Hugh Mcdonald
Unverified
Senator Fredrick J. Love
Unverified
Speaker 47
Speaker 48
Speaker 61
Speaker 63
Senator Mark Johnson
Unverified
Senator Jamie Scott
Unverified
Representative Jack Ladyman
Unverified
Speaker 83
Speaker 21
Speaker 92
Speaker 14
Speaker 104
Representative Ryan A. Rose
Unverified
Senator Ricky Hill Chair
Unverified