House Convenes

And by the member staff press and guests in the galleries to stand to be led in prayer by the house chaplain Dr rex sworn and remain standing for the pledge of allegiance to be led by representative. Let's pray please. Father we reminded from the scripture. That as we wait upon you will be able to a run and not grow weary we will walk and not faint. When we think of Paul's writing in the New Testament. Where he encourages us not to grow weary in well doing. Because we will reap if we faint not. So I pray for these women and men of the chamber of that as they do their work that they will have strength to run have strength to walk but most of all have perseverance endurance not to grow weary in well doing whether it's in their personal life their family life community life for public service may you bless them with the extraordinary amount of wisdom and strength today in Jesus name amen. Members please indicate your presence by pushing your yellow present button prepared machine Mr Clerk. Cast about Mr Clark. With ninety five members present chair sees a quorum are there any request for leave. Representive Pilkington for what purpose leave a representative for a it's leave granted representative ray. So noted representive Allen for what purpose. It's leave is leave grandpa representative Ken Ferguson. So noted represent life what purpose leave you're recognized leave a representative flowers is leave granted represent flowers. So noted. Represent Fredrick Love moves we dispense the reading of the previous day's Journal without objection so ordered are the reports from select committees are the Reports from standing committees is there any unfinished business are there any executive communication. Mr Clark please read house resolution one thousand two. House resolution one thousand two by representative Ladyman to recognize the Jonesborough high school hurricanes boys basketball team as a twenty twenty two class five A. state champions and the second consecutive five a class five A. state champions. Ferguson Ladyman you're recognized to explain resolution. Thank you Mr Speaker I'd like to invite representative Tosh representative Cavenaugh. representative rye. And representative Brandt Smith come will. We want to recognize the Jones bro high school here teens boys basketball team for their accomplishments this past season they were the five A. state champions for the second consecutive year they defeated the Merion patriots sorry Merion folks in the state tournament files by a score of fifty five to twenty eight they finished the season with a twenty eight and three record and ranked number one overall in the final Arkansas sports media poll. They did not lose to an in state team. And we're the only team to the defeat. Very good North Little Rock team. I thought I'd get a response to that. They were also ranked number twenty in the fifty teams Max preps national rankings. And number twenty two in the S. B. live Sports Illustrated power twenty five poll. At this point I want to introduce the coach of the hurricanes coach Wes with is in the north gallery. And. Unfortunately he couldn't get the players together I know I think coach Tommy five of your players are going on scholarship ones at Oklahoma state ones an army ones airforce so you can pull those together but coach we have a house citation that representative Brandt Smith is going to present to you for your trophy case. Thank you very good season no no let me let me talk about the coach for a minute some of you all he knows quite a few of you all we met this is he was coming in but coach with as been here a couple of times since I've been in the house coached with also received various awards for his job is coaching job. and at the number one team in the state he received the law manning award for the most outstanding boys coach in any sport across the state of Arkansas. For a second time. He was also number one on the list of outstanding coaches for twenty twenty one and twenty twenty two athletic seasons by the Arkansas high school coaches association. Six of his players were named all conference. Three of his players were named all state. Coach you had a great year one of the best I've ever seen we want to honor you and your team for your hard work and your accomplishments Mr Speaker would have the Clerk read the resolution isn't tired. Mr Clark please read the resolution. Whereas the twenty twenty one twenty twenty two Jonesborough high school hurricanes boys basketball team at the class five A. boys basketball state championship after defeating the Merion high school patriots boys basketball team with a score fifty five to twenty eight at the bank of the K. arena and hot springs Arkansas on Tuesday March tenth twenty twenty two and whereas with this when the hurricanes are in their second consecutive championship and whereas the hurricanes finished the season with the twenty eight to three record were ranked number one overall by the Arkansas sports media poll and number twenty in the fifty teams Max preps national rankings and the number twenty two in the SB live Sports Illustrated power twenty five hold and whereas the hurricanes team included Keyon Williams Mariane Wilson Devin Smith D. on Buford Westen Kailyn Kelly the various Montgomery John Paul Pickens Phillips Hillman Is a Carole James Blair Kalin Krohe Chris Stacey Jesse Washington Quintana Neil tie Spicer came on point terrace Brown marquee VS picket Kellen Mullins and AEGEE Phillips and whereas the hurricanes were led by head coach Wes within that system could just Sammy Lewis and can. weaver and whereas head coach Wes swift receive allow committee award for the most outstanding boys coach in any sport across the state for the second time and top the list of outstanding coaches for the twenty twenty one twenty twenty two athletic seasons seasons by the Arkansas head coach art Arkansas head coach Association and whereas Keion Williams Jesse will Washington and I was a Carol or all state for the twenty twenty one twenty twenty two school years and we're at six of the players. Key on Wilson Williams Jesse Washington I think Carol Amari on Wilson came on pointer and Dion Buford Weston were named all conference for the year and we're as Keyon Williams was named the Most Valuable Player for the class five A. state tournament now therefore be it resolved by the house of representatives of the ninety third General Assembly that the house of representatives of the ninety third General Assembly recognized the judge or a High School hurricanes boys basketball team as a twenty twenty two class five A. state champions for the second consecutive five Class A. state champions. Mister Speaker I if I could I'd want to ask my fellow representatives don't want to add anything. Reserve Ladyman is explain the resolution would anyone like to speak against the resolution. Would anyone like to speak for the resolution. President Ladyman is closed for the resolution the question before the House is adoption of house resolution one thousand two all in favor say aye. Any opposed. AS Lucians adopted. Morning hour is ended Mr Clark please read house bill one thousand two. House bill one thousand two by representative Jett to reduce Arkansas income taxes to adopt federal law on it duplication and depreciation and expensing of property to create an income tax credit for certain taxpayers and to declare an emergency. Represent Jett you're recognized to explain the bill. Thank you Mr Speaker. Because I think everybody here probably knows how they're going to vote on this bill and it's been out been in the press and I've talked to quite a quite a few of you guys sent this bill out sometime last week and restrictive ocean call me to ask me questions about the bill so I think because of that I think I'm School study on fifty thousand foot view. So This bill basically has four parts to the formal start off the income tax reduction part of the body knows back last December we passed a package or person Maddox bill passed package takes the top marginal rate down to five point nine to five or four point nine knows will be phased in triggered in over a period of of the twenty twenty five what this bill does is not a new tax regards what you read what you heard this is not a new tax one thing we're doing now is we're bringing the twenty twenty five four point nine in retroactive all the way back to January first twenty twenty two so that means this immediate reduction on payroll taxes DFA's going to send out payroll schedule to the employers. in September and October the plot the the employers can elect with employees can elect to start taking deductions on four point nine percent on their taxes. So the second part of the package is a corporate income tax same thing with the it was triggered a phase down all the way up to twenty twenty five we're gonna bring this back instead of making it retroactive twenty twenty two is going to come back to January first of twenty twenty three and that's going to go down to five point nine to five point three. The third part of the bill is the depreciation for the one seventy nine be remiss if I didn't mention representative Brady champion this cause product revenue taxes pass session the cost of it at the time was time of doing a schedule one seven one sixty eight along with the one seventy nine I think was like a three million dollar hit it was just two months to get our hands wrapped around the time the problems represent body that we have the opportunity to fix this we would do this so this is included in this package I will tell you all this is big for our Arkansas businesses is huge for Arkansas farmers ranchers this section yesterday committees because my language this is not sexy but it's something that will absolutely benefit a hard working or cans is that owns businesses and farms and ranchers back then it will let them to appreciate one hundred percent right out the gate this will be over thirty years a state instead of them having to appreciate something over five seven years if you will get take a hundred percent deduction right out of the gate up to million dollars and eighty seven million and eighty thousand dollars right out the gate so this this would be huge for those folks last but not least is inflationary the one hundred fifty dollar tax credit is a non refundable tax credit goes UP eighty seven thousand dollars so my next level of blowing eighty seven thousand dollars they get a hundred fifty dollar non refundable tax credit and then it scales out to one hundred and one thousand dollars so anybody making above eighty seven thousand scales back down off the hundred fifty five hundred dollars in the end below eighty seven thousand dollars it's a hundred fifty dollar tax credit action is non refundable and then if if America pulls filing jointly then you just double that in the same is the same same mechanism if you will total cost of the patches five hundred million dollars thank support keep in mind if they as the forecast. Adult in two twenty twenty three we can do this along with everything else forecast phone RSA they're still well over four hundred million dollar surplus. The elephant in the room is the thing I've been called the most about is a safe harbor act in say four raptors talking about the federal government Clause back the money if we do not operate a spin do our taxes the base with what the federal guidelines are only cares that. So with that I'm. Them to help. I work trying to get an answer on this for about a year now in the. So I reached out to DFA several times and obviously in the bill are some folks but so I've come up with this quote from this is this is this is a paragraph but secretary Janet Yellen ROW from department treasury and it says and she says nothing in the act prevents states from enacting a broad variety of tax cuts that is that does not deny states the bill to cut taxes in any manner whatsoever is simply provides the funding received under the act may not be used to offset a reduction in tax revenue this state lord certain taxes but do not use the funds under the act offset those cuts for example by replacing lost revenue through other means the tax mandate is not implicated. So I think it probably speaks a pretty good what we're doing no money that's being used on the cures act is offset anything that's in our budget regardless what anybody's read heard or said. Of. In the also I reached out to senator Larry Walter in on your desk you're going to find the statement from secretary Larry Walter that this will be entered into the Journal if we pass this package today this statement will go along with the tax this tax cut package is going to be processed into the Journal. Thank you shall important members be made aware of this information I've had copies like said distributed this on your desk not submit this information be created to create a historical record of information on which we based our legislative decisions. So with that members as once again as a fifty thousand foot view what we're doing I think it like Senator thank everybody knows pretty much either going to vote and I would appreciate a good vote the people of Arkansas our work incidence of Arkansas Richard good votes will thank you. President Jett is explain the bill would anyone like to speak against the bill represent Collins you're recognized to speak against the bill. Thank you Mr Speaker Lot of respect for the people that brought the bill and I do think that there's some value in an I like everyone's taxes to be as low as they can be while affording what we need to do is a state in ensuring that our contributions through tax toward our shared interests are fair and equitable. When it comes down to is priorities and costs benefits. As the representative mentioned this bill has three components the section one seventy nine depreciation change catches us up with other states I thank you conform to federal law offers a big boost to business investment without a huge price tag very sensible component that's easy to support. The hundred fifty dollar non refundable tax credit is the only part of this bill that benefits working class lower income people and it's just insufficient. A hundred and fifty dollars might get you to tax the gas. And for lower earners as representative mentioned whose tax liability is less than a hundred and fifty dollars they don't even get that full amount because it's non refundable so the higher income person Mike at one fifty the lower income person Mike eight fifty or twenty zero. And that's not really inflationary relief that works for everybody everybody's paying higher prices right now everybody should get this credit that's what a refundable tax credit would do but that's not what this is. But the biggest issue for me is the acceleration of the reduction of the top individual and corporate tax rates any particular the changes to the second individual tax table the only hit people making eighty four five hundred or more. Cutting taxes for the wealthy like this is not going to have the impact that some seem to expect. People with high incomes will save a few hundred dollars a year people with extremely high incomes will save a few thousand dollars a year. Think about the person that you know who makes four hundred thousand dollars a year if you know anyone. That person is easily and millionaire that person would save maybe about two thousand dollars under this bill. You think two thousand dollars for a millionaire. Is going to prompt sent to hire a bunch of employees expand his business or changes spending habits or pay his employees a living wage. Thanks two thousand dollars will prompt businesses to locate here in Arkansas. Businesses want to be in places with an educated workforce low crime high quality alliance fair laws were top employees want to live and this bill doesn't do that. For the wealthy people this part of the bill attempts to cater to it just doesn't move the needle and the ways that matter. But it does because the state quite a bit three hundred and fifteen million dollars a year. For this part the fiscal impact all seen optimistically presumes that we are going to have to dip into long term reserve over the next several years but if we have a recession is something we mind we do need extra funds somewhere close to that three hundred fifteen million will be hit every single year into the future. That's three hundred fifteen million per year we could use to pay our teachers. XR roads support our police and reduce crime support are pregnant women and mothers. Instead we're throwing this money mostly at the wealthy who don't need it and won't care it's a high cost for low benefit. A couple other things some of which can mention this bill could cost us hundreds of million dollars in our funds we don't know is litigation pending on that right now it will increase inflation because we're pumping more money into the economy same as the simulants it's a stimulus mostly for the rich. And it sends a message to our constituents or crying out to pay our teachers that instead we care more about tax cuts for the wealthy. We're acting death to our people and that undermines US. We have incredible needs in our state education crime infrastructure and tax relief for the working class and middle class another tax cut for the wealthy is the wrong approach and I would urge you to vote no thank you. Collins spoke against building would like to speak for the bill. Would anyone like to speak against the bill represent McCauley recognized speak against the bill. Thank you Mr Speaker. May not be no surprise that I'd love for the surplus to be spent what I believed to be more meaningful ways teacher and support staff raises housing trust fund mental health help for all who desperately needed and more. And this chamber we sometimes throw around the term surplus. When we have the money to fund our most essential state services we refuse to do so. And sat on our hands and we can hardly call that a surplus we've seen the billboards in the statistics about teacher salaries and other states and that's not being competitive. Our historic surplus could be used to help it I was in the classroom for thirty three years and I can tell you some of our most talented teaching professionals are leaving the profession and sometimes the state an investment in our teachers as an investment our children. This very legislature was concerned. About how kids were learning during the pandemic but now we're not taking action when our school districts need it most. This year we also approved the use of funds to take thousands of people off the developmental disabilities wait list and while this ticket those people off the wait list they've now gone on to another one our department simply don't have the money to pay the salaries to hire the support staff to help these people and now they still wait for the care that they deserve. Many from our historic surplus could be used to aid in those areas. And I know that some money for folks who need it the most is some money I get that but with a nineteen seventy a hundred fifty dollars would have been something to really help today. It certainly cannot be stretch very far. So now is not enough time I believe for these tax cuts or for expediting these tax cuts we have a historic opportunity to fund our central services. We're focused on the wants of the few. Over the needs of our neighbors who need us the most so I ask that you vote against expediting the tax bill. Some McCullough spoke against the bill would anyone like to speak for the bill. Would anyone like to speak against the bill. Representative Jett you're recognized to close. Thank you Mr Speaker Collins I will it will come down here and have to close a but I think are some things that was said I was like to clean up the. You know that in the Davis have a lot of conversation this tax cut bill was put on a records this body voted on this back in December we're not changing anything other than what we're doing today is work celebrating what we done back in December of twenty twenty two. Never would have honest conversations about who benefits from this all Arkansans been for what well we would not want to close people who's been will off and and and and been stuck to members of our society only not one include them if you guys recall back in December with the tax cuts was for the bottom and middle middle income earners we we combined bottom table with the middle table and I will give you just a couple figures you know spot now figures here so I'm not sure couple figures also we're taking this thing down to four point nine percent right. Everybody is going to make about twenty three thousand six hundred dollars is going to be in at four point nine percent bracket they get the benefit of this thank you it in somebody go out to the public in Arkansas and find somebody's making twenty three thousand six hundred dollars you you you asked if there will. And I'm telling L. twenty three thousand six hundred dollars not a lot of money I could live on it. Thank you bye this chamber could live on with those folks get those those folks are getting the benefit of what we're doing here today so this is not just for the wealthy folks here. So many making twenty six thousand five hundred twenty six dollars their effective tax rate because we do have progressive task you know for example so in twenty twenty to the affected to effective tax rates one point nine seven percent. And they're going to they're tax they're going to they're taxes on loans three hundred and sixty five dollars offer tax liability on a twenty six thousand dollar income that is significant and I challenge anybody this chamber to go out find somebody makes twenty six thousand dollars and see if there will be there they will tell you they're not wealthy there's barely getting by. So with that Mister Speaker I'm close. President Jett his clothes for the bill the question before the House is the passage of house bill one thousand two we do have one pair on the desk representative David Ray votes yes representative Jamie Scott votes No representative Scott is the president member are there any procedural objections to this pair. Hearing none please not vote either of these two voting machines prepared machine Mr Clark. Voting on the bill and the emergency clause has everyone voted. As everyone voted. Cast about Mr Clark. By a vote of eighty one yeas and fourteen days the bill is passed. Members we are going to stand in recess upon the call of the chair we're gonna wait for the Senate to send their send bills down to us so that then we can refer those to committee so we'll stand in recess hopefully just for a few minutes upon the call of the chair. The House will come to order. Members before I before I take a motion to adjourn just so you'll know the Senate passed both bills or on their calendar today so there those are headed down here to us there will be a revenue tax House revenue tax committee meeting fifteen minutes upon adjournment We have to get the bill so hopefully we can get that next fifteen minutes but there's no sense nobody else waiting around. So with that I'll recognized represent eleven. Motion you're recognized. Thank you Mr Speaker after the announcements reading of bills transferring the bill's place in the calendars on the desk committee members amending their own bills with their own amendments members withdrawing their own bills finalizing resolutions ready communications and any remaining committee reports I move that we adjourn until nine AM tomorrow morning. That's a proper motions non debatable all in favor say aye. Any opposed. Motion passes are there any announcements represent Fortner what purpose now you're recognized revenue tax fifteen minutes one fifty one. Any other announcements. Seeing none the desk remain open as needed for the reading of the bills upon completion The Addams named in the joint resolution the house to be adjourned until nine AM tomorrow.