Revenue & Tax - Senate

Revenue and Tax meeting to order sure sees a quorum and we're about to hear Senate bill three oh four Senator Rapert Senator Rapert under you see that you have. Several people here to testify you for your bill so if you want to bring any of those up right now you can if not we'll bring up whenever you want is a good start with second have more quick more efficient works on county and members we have a handout. In so once Mr quick forget say did you whenever you get ready. I Mark. Mr Clinton would use so your name for the record please Mr chairman mark Whitmore session candies. Senator Rapert. Thank you Mr chairman. Members Senate bill through four one of the things I want to make mention of you sure hopefully you've gotten this report this is the task force of grants to state law enforcement Arkansas's final report it has information inside of that that's relevant to the bill just a few comments on this to put this in perspective salaries for law enforcement Arkansas among the lowest in the nation the task force submits the state of Arkansas law enforcement Arkansas found the extremely low starting salaries for law enforcement the most predominant obstacle for recruitment hiring and retention of law enforcement. H. nine favorable applicant pool that is run retention and as you know one Arkansas folks a law enforcement all officers or search regular would you hold a second. It often. And what Senator Teague is silence and his phone if there's any member anyone in the audience if you would please silence your phones is you can see the caller very big distraction while there's just a moment's of. Senator Rapert. Thank you I would like to point out to you on page fifty two three fifty nine of the task force report which the the entire report is not there we just gave you the relevant information what you'll see there is the task force about midway on that first page the task force found the law enforcement administrators throughout the state or experiencing issues in recruitment stemming from a lack of qualified applicants that was eighty one percent and then low salary eighty nine percent. And you know we're having difficulty and it's primarily due to the fact that when you look at law enforcement across the the state you have a disparate situation there where you've got some very real counties cities or in rural counties where they just aren't able to have the income of the revenue to supply starting salaries that are commensurate with their peers in other states in other locations as you go through the rest of that report you're going to see consistency on that particular issue is well And a couple of things to to put in perspective many of the counties in Arkansas are struggling to provide decent salaries for their employees in general quorum court's do what they can to provide some level of increases to their employees but some years no salary increases are provided in obviously this is his work is wreaking havoc in terms of recruitment for new law enforcement officers the situation that we've seen around the country in the last year year and a half especially with the negative focus on the phone the police things of this nature is but even more stress I think there are some applicants or people that would have been applicants that were interested in law enforcement in they've seen what's happened around the country they've seen some of the disturbances just like we had right here in Little Rock Arkansas last year as well and they begin to question why would I go into law enforcement and work at one of the lower salaries in the nation when I could go see to do something else not be in danger and be able to provide even more for my family the fact of the matter is that Arkansas has to have law enforcement you can have a nation of laws or even in our state without someone that is law enforcement so what would like to do is to provide some help for them a state income tax break was afforded to military and veterans here in our state previously and we also have done tax breaks for firefighters in addition to that what this bill would ask for to begin with is a three thousand dollar income tax credit you see in your DF in a report the disclosure states it's about a fifteen million dollar cost to the state it is a non refundable credit there was a mention I think of the original bill very in there they said they didn't know but actually I just talk upon hearing they do stay there on the very front part of the have your impact statement that it is non. One double it would be a fifteen million dollars with that Mister chairman I would like to wreck you have you're recognized with more and I believe we have to share of state I've been designated to speak on the bill as well. Mr Whitmore. Yes Mr chairman members of the committee of the focus of the police report. came up with the idea of the recruitment for number of retiring and retention law enforcement this is the most important factor and they compared the salary compared the average salary of our cancer which if you'll notice it was law enforcement salaries below the average salary the state they also focused on the entry salary will on the national level law enforcement Arkansas ranks forty ninth out of fifty one that's when you count the state so in the in essence if you're a young person and you want to become a law enforcement you'll pick almost any other profession if you're concerned about for your family because you're with you'll make below the average dollar in Arkansas and also let me paint we pay less attention to our law enforcement to any other state except for one of. At four forty nine fifty one of mechanically this bill rewards retention because in the sense you don't get the credit if you work eleven hours eleven months or twelve and you have to be full time so what will happen is mechanically we work with different I will work with the idea that if you're working over twenty five hours of a week your full time and you in essence work eleven months then you can include that in your your request for the rebate so you pay your tax deferral is taken out by the county Clerk of the the city or the state this includes all law enforcement all full time state city county federal and in essence they'll take it out we plan to rebate by showing and your the shares in the case of a county and the chief deputy would sign that you're full time in the work of you know for twelve months or so. And so it does have an impact on retention and we think this is absolutely necessary and as just on the county standpoint we have counties which none of the county employees had races for periods of time we have county where we just get a cold or bonus will just be blunt about it the counties can't do special they're just not going to for a certain segment of the employees over the other some of the best counties can do is is there sometimes no rages because health insurance goes up or bonus or colors so we're not going to catch up unless we start aggressively attacking this problem and this is a major major improvement on that the share speak about how the impact this would be. Are there questions were. It'd Senator Rapert or. Mr twit more center Johnson. Thank you Mr chairman of in center Rapert or or missed what we want we can answer this The credit states three thousand. if I'm a police officer and I file my return let's say they with held. Twenty eight hundred dollars for state income tax that for that all my W. two and I filed this then I would zero tax but that two hundred dollar difference I don't get that refunded that's my understanding that's correct that's the difference between refundable non refund now but is there a carryover of the unused tax so with that two hundred dollars carryover for the next tax year like some of the tax credits that we we have that have a some of the three some of a five year or even a seven year I'm not aware that with this case okay be happy for that to do so. Well I'm in that again that's more of an analysis than a intent I know you all would like to give maximum benefit but we need to whatever it is that we just need not it might be a Mr Gehring court your senate Johnson out when Mr group comes up you can asking that question but I don't thank you but thank you jim are there other questions for. You must work for or Senator Rapert seeing none of now there or. Two other thank you people speak I think there from the sheriff's association and Mr Scott Bradley and I'm sorry but I can't read it so the name. Yes Sir the. I can decipher that now that you said that if you like come to the table place. When you get seated you can take off your mask if you're comfortable you would state your names for the record. Push the little button. Sheriff Rodney wrestling County I recognize you sure. It sure will be run in Sebastian County good to have you here which one of you wants to speak first okay sure. German. I read I've changed it to meetings back in December one was with the judiciary and the other one was with the black caucus both meetings I was asked what can we do for you. By senators and representatives in both meetings both of them. Basically said what help us help you. That was the question that was asked back in December. We put together a proposal this is the best way for you to help us. as you have already heard per forty ninth in the nation. Just saying that it's embarrassing. It's hard enough to get law enforcement right now the way it is a way that the world is is turning. But when you when you look at that and then you look at the other seventy four hundred officers and in Arkansas full time officers. And I heard the the dollar amount fifteen million is what the impact is for the state. I think when you talk about the fifty million because I know that there's other tax bills out there and it you'll have to consider. I think it's all about property. And when you think about what's the number one priority in the state of Arkansas. I may be a little bass but skews me. Would you would you like some water now that's okay thank you Sir. But when you talk about priorities. And I will get non committee. People moved in my community because of a safety they will moved in to our communities because safety is number one obviously then schools and and medical but safety is always the number one consider consideration by any family that moved into town and you have the opportunity this year to affect every law enforcement officer in the state of Arkansas every single one of. Our quorum court or city councils. Summer strapped they can't and we can't ask him or force him to do anything but this is something that you can do. And again I was asked to different meetings in December what can we do for you well that is exactly what you can do for us is this bill right here. Thank you thank you senator. Good morning and I thank you for allowing me to come before this body. I'm somewhat Dalby short but a somewhat mimic what we have heard in my own agency in the past we might have twenty or twenty five people applying every month for entry level law enforcement positions we're to the point where I might have two or three we're out we're out actually beating the bushes to fill these positions I is became critical it's become a safety issue and the problem is we cannot compete with the private sector or even sometimes other states. Recently I've lost deputies to Texas Missouri and most recently Mississippi of all states and these these all these were great deputies that I felt like had a future law enforcement they were the kind of people that you would want policing your streets and they all left they had to do what they felt was better for their family at the end of the day if we cannot hire and we cannot retain our officers as Arkansans we're going all pay the price generally it takes realistically three to five six years before a deputy or officer is really productive and know what they're doing they have to gain a little bit of wisdom and these are the types of people that we're losing the people that have a future here when you talk about a tax credit for somebody making thirty or forty thousand dollars a year or less depending on where they're from that's huge we see a lot of statements made nationally and at the state level about supporting law enforcement however this is tangible this is something that will impact their bank account it'll impact their families I think it's great that we give a tax credit to volunteer firemen I spent eighteen and a half years as a volunteer fireman. I think it's great that we given to the military. As a veteran of Iraq and Afghanistan over twenty years in the military is appreciated but I will tell you. They're not under attack like law enforcement as a profession and personally and this would make a difference to those men and women in law enforcement and would make a statement that we is our Kansans want and support our law enforcement. Thank you for allowing me to spend I've got a question you mentioned officers that that you're lost on the stage with a entry level officers or rebate offer shoes rank one of them had four years one of them had eight years and one of them had five years Sir and they all went for we have we only want to talk about Texas you know that that's a whole different economy I understand that but the the latest one was a a young college graduate was twenty seven years old recently married and he actually was able to go to Mississippi of all places and get quite a quite an increase in salary there was nothing other than he was looking at where he could raise his family and provide for them in the best manner it wasn't that he had family or anything okay. Members are the questions Senator Johnson. Thank you Mr chairman shares of I'm a co sponsor I'm very proud to be an act but as you know we're here to kind of deal with the fiscal side of this and I wanted to ask if with this turnover you discussed yes fifty million dollars in expense but when an officer or deputy leaves you've got to hire someone you have to train them that is not free there's expenses involved in every part of that could you see how the savings of retention could potentially mitigate some of the revenue loss from this but do you see that I'm I'm not asking to put a number on it you you are economists but but just in general is that uh something that we could could expect and hopeful. Yeah. I'm sorry I absolutely and in our own case what you said I'm I'm definitely my wife's account in the family but in this case is it takes us a minimum of six months just to get a person trained we're looking at three plus months of the academy and at least three plus months of of a field training officer and then as I said it's still several years before they really have enough knowledge and experience to be a good law enforcement officer so it would be hard to calculate what the cost is but it's it's absolutely you can be phenomenal as we look at a statewide I feel like it would offset that that in the long run especially for us or for the local agencies. Thank you Mr chairman at a I suspected we were looking at that but they did corroborate thank you and I can see where that it would benefit your your new officers probably more than anyone else because that would be it would cover so much more of their earnings that three thousand dollars so Arkansas leads word it would be a definite recruitment to let you can use. Are there other questions for the sure. Seeing none thank you. Senator Rapert you're ready close. Senator Rapert before you close I've got Mister gearing to taken present from the. The F. nice that. I'm sorry. Morning Mr chair Paul gearing DFA okay in your ears with the fiscal impact statement for let me three oh four that's correct Mr chairman thank you Mr chair members of the committee I DFA did work with the sponsors of this bill as long as well as many of the interested parties over the past few months to identify the revenue impact and and the among the very structures of this bill what it would take as currently drafted the bill provides for a three thousand dollar non refundable income tax credit for law enforcement officers that qualify based upon our calculations which included about eight thousand three hundred and ninety five law law enforcement officers that would potentially qualify for the credit an average salary of around forty thousand dollars we calculated the fiscal impact statement per fiscal year to be fifteen point three million dollars I would be happy to answer any questions about the revenue impact center Johnson did you want to ask your question. Yes thank you Mr Mr hearing you heard my question about the carry forward could you answer that I did this bill does not provide for Kerry for so if you have a three thousand dollar credit use twenty eight hundred of it that's it to you get the next years three thousand that's good couldn't accumulated a carry forward of the bill could certainly be amended to provide for a carry over but as as currently drafted does not have a containing carry forward okay of I know that you all do the revenue impact well we've had this conversation before I will go in the weeds on that but in any way did your economists at looked at this did they factor in the possibility of of cost savings both the law enforcement training academy or to to the local sheriffs and police departments on. How retention might be a more positive thing on the bottom line was that factored into the coat questions Senator Joyce it's a static revenue impact it doesn't contain any offsetting us cost savings that could benefit the departments As a result of retention of their officers and their deputies but certainly. And those those costs are certainly real I have if there's a an officer that the the state or the county is going or the city's going to the expense to go to the training at the academy. The the field training within the department and then that officer goes and leaves for a different opportunity outside the State of Arkansas that certainly real expense but it's not accounted for this is a static impact based upon the change in general revenue as a result of the allowance of the credits are thank you Mr thank you Mr. Are there other questions from members. Saying I'll Senator Rapert Rice close revealed thank you Mr chairman and and I do appreciate for for you allow the hearings this bill and for the members paying close attention to it you know we come in here and tax revenue we hear a lot of ideas and we hear a lot of proposals. And sometimes it you know it we've got a lot of bills coming at us sometimes against glaze over just a bit. And as a stated in here senator Johnson we're talking about the revenue exactly right. But this morning I don't see numbers I see people and I see a lot of them in this room. And I think about the fact that if each one of us got a text message from one of our family members or somebody back home when there was a problem guess what. We're gonna be hoping and praying. That one of the men or women that serve in these departments gets to our family just as quickly as possible to help them. So I think about what it means to me as a citizen here the old saying. Put your money where your mouth is. They say were you look at your check book and you find out what's important to you. And I'm sitting here thinking about all the different issues and I know that there's a lot of great proposals my my name's on sponsorship of some other proposals out here that I think would be great for people. But when I think about this something that the more quick more mention I actually have a copy. Of this best and worst states to be a police officer. And when I look at it. Yes we may have been forty ninth in the salary but they rank Arkansas fifty first. As the best or worst place to be a police officer. That's what this ranking says underneath the District of Columbia. The next thing is I close with this part Senator and thank you for the committee listen to this here's the highest average salaries in the state California a hundred five thousand dollars Alaska eighty seven thousand dollars New Jersey eighty six thousand Washington eighty thousand Hawaii seventy eight thousand Illinois seventy eight New York seventy seven Colorado seventy five Delaware seventy three in Nevada seventy three thousand dollars. An Arkansas at forty thousand. Five hundred and seventy dollars. So I don't know if governor Hutchinson ever reviews the tapes of tax and revenue but I hope we reviews this one. And I hope that we can earn his support to say we're going to make a difference. Now I'm not asking for new general revenue money to be come up and put in a budget sent out but what I'm asking is just like Senator Johnson stated we've got an officer in his tax due is twenty eight hundred dollars was given the opportunity to keep that money in their own pockets for their family. We're not going to be able to get to the average salary California. At least not now but we can do a heck of a lot better I think by our police officers in our law enforcement across the state and so for my part today I know that we're going to hear this no vote will be taken but I hope that as we sit down Senator Hickey and I'm glad you're on this committee is president of our Senate I hope that we can sit down and really think about we're going to put our emphasis what we're going to do and I hope that we can at least do something here for the law enforcement officers in with that center I'm close thank you thank you for presenting your bill. For those in the audience. It's a normal procedure for this committee not stake in take a vote on a on a bill that has fiscal impact we will get together figure out what how much money we have to take in and do tax cuts and and legislation such as this then we'll come back and pass those bills out of committee and I will go for I thank you for coming here thank you for showing up we're definitely interested in your problems and so with that we're germs thank.