Insurance & Commerce - Senate
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Bills discussed (14)
| Bill | Title | Sponsor | Status |
|---|---|---|---|
|
HB1558
Act 392
· 4 mentions in transcript, chapter, agenda
Matched: “Yeah, we, um, So, uh, Representative McGrew. All right, House Bill 1558 by Representative McGrew. If you'll introduce your no, no,…”
|
TO AMEND THE LAW CONCERNING THE ARKANSAS REAL ESTATE COMMISSION; TO CREATE A PROPERTY MANAGEMENT … | McGrew | Notification that HB1558 is now Act 392 |
|
SB319
Act 461
· 3 mentions in agenda, chapter, transcript
Matched: “…vin Sen. Clint Penzo REGULAR AGENDA Number Sponsor Subtitle SB319 J. Boyd TO AMEND THE UNIFORM LIMITED LIABILITY COMPANY ACT;…”
|
TO AMEND THE UNIFORM LIMITED LIABILITY COMPANY ACT; AND TO CLARIFY CHARGING ORDERS UNDER THE … | J. Boyd | Notification that SB319 is now Act 461 |
|
HB1298
Act 307
· 2 mentions in chapter, agenda
Matched: “HB1298 L. Johnson TO MODIFY PAYMENT OF BENEFITS FOR CERTAIN HEALTH…”
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TO MODIFY PAYMENT OF BENEFITS FOR CERTAIN HEALTHCARE PROVIDERS UNDER A HEALTH BENEFIT PLAN. | L. Johnson | Notification that HB1298 is now Act 307 |
|
HB1587
Act 310
· 2 mentions in chapter, agenda
Matched: “HB1587 L. Johnson CONCERNING THE ANY WILLING PROVIDER LAWS; AND TO…”
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CONCERNING THE ANY WILLING PROVIDER LAWS; AND TO AMEND THE PATIENT PROTECTION ACT OF 1995. | L. Johnson | Notification that HB1587 is now Act 310 |
|
HB1595
Act 349
· 2 mentions in chapter, agenda
Matched: “HB1595 Steimel TO ENACT THE STATE INSURANCE DEPARTMENT'S GENERAL O…”
|
TO ENACT THE STATE INSURANCE DEPARTMENT'S GENERAL OMNIBUS AMENDMENT OF ARKANSAS INSURANCE CODE. | Steimel | Notification that HB1595 is now Act 349 |
|
HB1620
Act 350
· 2 mentions in chapter, agenda
Matched: “HB1620 Gramlich TO AMEND THE LAW CONCERNING PHARMACY BENEFITS MANA…”
|
TO AMEND THE LAW CONCERNING PHARMACY BENEFITS MANAGERS; AND TO REGULATE PROCESSING AND PAYMENT OF … | Gramlich | Notification that HB1620 is now Act 350 |
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HB1634
Act 305
· 2 mentions in chapter, agenda
Matched: “HB1634 Hawk TO ESTABLISH THE ARKANSAS SPORTS RAFFLE ACT; AND TO DE…”
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TO ESTABLISH THE ARKANSAS SPORTS RAFFLE ACT; AND TO DECLARE AN EMERGENCY. | Hawk | Notification that HB1634 is now Act 305 |
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SB103
Act 425
· 2 mentions in chapter, agenda
Matched: “SB103 C. Penzo TO CREATE THE PHARMACY NONDISCRIMINATION ACT; TO R…”
|
TO CREATE THE PHARMACY NONDISCRIMINATION ACT; TO REQUIRE PHARMACY BENEFITS MANAGERS TO ACCEPT ANY PHARMACY … | C. Penzo | Notification that SB103 is now Act 425 |
|
SB104
Act 514
· 2 mentions in agenda, chapter
Matched: “…ONABLE TERMS OF PARTICIPATION; AND TO DECLARE AN EMERGENCY. SB104 C. Penzo TO AMEND THE ARKANSAS PHARMACY BENEFITS MANAGER LI…”
|
TO AMEND THE ARKANSAS PHARMACY BENEFITS MANAGER LICENSURE ACT; TO PROTECT PATIENTS' RIGHTS AND ACCESS … | C. Penzo | Notification that SB104 is now Act 514 |
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SB123
Act 553
· 2 mentions in chapter, agenda
Matched: “SB123 G Leding TO AMEND THE LAW CONCERNING COVERAGE FOR MAMMOGRAM…”
|
TO AMEND THE LAW CONCERNING COVERAGE FOR MAMMOGRAMS AND BREAST ULTRASOUNDS. | G. Leding | Notification that SB123 is now Act 553 |
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SB140
· 2 mentions in chapter, agenda
Matched: “SB 140 J. Boyd TO MANDATE THE USE OF BIOSIMILAR MEDICINES UNDER HE…”
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TO MANDATE THE USE OF BIOSIMILAR MEDICINES UNDER HEALTH BENEFIT PLANS; TO REQUIRE A HEALTHCARE … | J. Boyd | Sine Die adjournment |
|
SB83
Act 424
· 2 mentions in chapter, agenda
Matched: “SB83 J. Bryant TO MANDATE COVERAGE FOR BREAST RECONSTRUCTION SUR…”
|
TO MANDATE COVERAGE FOR BREAST RECONSTRUCTION SURGERIES; TO REQUIRE PRIOR AUTHORIZATION FOR BREAST RECONSTRUCTION SURGERIES; … | J. Bryant | Notification that SB83 is now Act 424 |
|
SB323
Act 516
· 1 mention in chapter
Matched: “SB323 J. Bryant TO AMEND THE HORIZONTAL PROPERTY ACT.”
|
TO AMEND THE HORIZONTAL PROPERTY ACT. | J. Bryant | Notification that SB323 is now Act 516 |
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SB366
Act 427
· 1 mention in chapter
Matched: “SB366 J. Boyd TO CREATE THE STRENGTHEN ARKANSAS HOMES ACT; AND TO…”
|
TO CREATE THE STRENGTHEN ARKANSAS HOMES ACT; AND TO CREATE THE STRENGTHEN ARKANSAS HOMES PROGRAM … | J. Boyd | Notification that SB366 is now Act 427 |
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- October 2, 2026
Senator Justin Boyd
Unverified
0:12
have an amendment that we're going to hand
out. And Representative Maddox will explain the uh agreed to amendment. For me too,
I mean. Yeah, so the, the bankers had some concerns about the original bill and so Representative Maddox has been working with them to get an agreed to amendment. To clarify one thing. So
Representative Maddox, when you're ready, please begin presenting the amendment. The Senate Bill 319 introduce yourself and then present the amendment to 319. Yes, sir. Thank you, Mr. Chair.
Representative John Maddox
Unverified
0:53
Thank you, members of the committee. John Maddox, District 86, um, so very simply, the amendment and to answer your question, Senator Flowers, this amendment was agreed to by the Bankers Association. They had some concerns about the original bill, so we, we did this amendment. For them. So this amendment is
very um it's really pretty simple. It just makes it very clear that if a bank has a perfected lean against a membership interest of an LLC, than they can foreclose upon
that lien, so that's all the amendment is. Senator Martin Johnson question. Thank you, Mr.
Senator Mark Johnson
Unverified
1:33
Chairman. Representative Maddox, there is a word on the amendment that I have to admit it challenges my
vocabulary. But what It's in be on page one. You know, um, You would think I could give you a really good definition
Representative John Maddox
Unverified
1:56
of that. If you hypothecate, then you are basically declaring it is what I would say hypothecation. So that would be my, I can get you a better definition really quick though. So yeah, I mean it's it's it's,
Senator Mark Johnson
Unverified
2:15
it's a, you know, 75 cent word it's almost that's I mean, I did go to Hendrix, but it's
Speaker 21
2:21
still a big one for me too so but I'm I'm not going to oppose
Speaker 23
2:26
the amendment over that, but I would like to learn. It's a, it's pledge money by law to a specific purpose. Well,
Speaker 24
2:35
that's kind of what mortgages are all about and lean
Representative John Maddox
Unverified
2:38
so yes, I would say it's just another assignment pledge hypothecation, it's just another word in that list of definitions.
Senator Justin Boyd
Unverified
2:46
Thank you. Thank you. Thank you, Mr. Chairman. We've got a motion. We have a second, all in favor say aye. All right, um adoption of the amendment approved Representative Maddox, if you'll proceed with presenting my bill as amended, I would appreciate it. Yes, and I did want to
Representative John Maddox
Unverified
3:07
make clear this is actually Senator Boyd's bill, so I'm presenting his bill. Yeah, that'd be great.
Senator Stephanie Flowers
Unverified
3:18
I have more. Well, I'm, I'm OK. You run the chair. Now. Yeah,
Senator Justin Boyd
Unverified
3:38
that's right. Uh, for the record, Senator Justin
Senator Stephanie Flowers
Unverified
3:41
Boyd. Thank you. You can proceed with the bill as amended. Thank you,
Representative John Maddox
Unverified
3:46
Madam Chair. So this bill is to
be completely frank, this is a very important bill in my opinion. This bill strength strengthens the liability protections for members of LLCs in Arkansas. So right now, Arkansas law does not provide sufficient liability protection for people who are members of LLCs, and it has become a real problem. I've been contacted by numerous. State planning attorneys who have said that they are now refusing to um That helped me actually. Um,
that I've had numerous estate planning attorneys who have contacted me and said that they are now, and this is real important, they are refusing to form Arkansas LLCs because they do not provide sufficient liability protection. So Arkansas businesses that are forming LLCs are having to form in Texas, Nevada, other places like that. So this rectifies that. We looked at the Texas statute. And mirrored that um and that's basically what the bill does.
Speaker 43
4:54
Questions from members. Go ahead, Senator Johnson.
Senator Mark Johnson
Unverified
4:59
Thank you, Madam Chair. Uh, I'm not sure, Senator and Representative,
I just want to make sure we are equating LLCs to the same protections that are awarded or given to corporations and partnerships and this, this would bring equity between all the possible forms of business, would it not? Yes, sir, and it
Representative John Maddox
Unverified
5:27
would again, the reason people form LFCs as they think they're getting liability protection. It's in the word limited liability and it's not as strong as it needs to be and this gets us more competitive, frankly with Texas, so we're not losing Arkansas businesses to Texas losing that entity being formed in Texas and then a lot of times that includes opening a bank account in a different state, so we certainly don't want that. We're becoming more business friendly every session. We've made great progress. This is something that I think we need to
Senator Mark Johnson
Unverified
5:59
To rectify. OK, so I just want to clarify this would apply, obviously to new LLCs, but it would also protect existing LLC. All right, great. Thank
Speaker 48
6:09
you, sir. Thank you, Madam Chair. Other questions about members. I have a
Senator Stephanie Flowers
Unverified
6:15
question on the top of page 3, it reads the charging order liens shall not be foreclosed on under this subchapter. Or any other law.
Yes, ma'am. Uh, I'm, I'm trying to, to visualize
what what this means the order. The lien shall not be foreclosed on. No, that's,
Representative John Maddox
Unverified
6:44
that's a great question. So let's say that someone gets a judgment against a member of an LLC. Say you're in a car wreck, something not related to your LLC, and someone gets a judgment against you, right now under the law they can come in and foreclose on your
LLC interest. OK, and that's not good. That is not what Texas allows other business friendly states allow this a creditor would still get a distribution. So if you ever take money out of your LLC as a distribution, they could attach that, but they can't come in and foreclose on your LLC. An example I like to use is let's say
that 3 men go into a partnership or an LLC partnership, right? For rent houses or something, and then one of them
Get sued for a car wreck or
something. Well, that creditor can come in and foreclose on that member's LLC interest. Next thing you know you're in business with someone who was in a car wreck. So this is what we have to fix. What you, what, what you pointed to is a very salient point. So what
Senator Stephanie Flowers
Unverified
7:49
are you saying that they would become a member because of the members' interest and because they had
Representative John Maddox
Unverified
7:56
a judgment under the current law, yes, basically they foreclose on that member. Interest. I don't they just take
whatever the value is that that's, that's what they're going to intend to do, and that's what we're going to stop
Senator Stephanie Flowers
Unverified
8:11
with I don't understand how they would become recognized
as a member just because, well, yeah, that's what our current law does. They just like think about like
Representative John Maddox
Unverified
8:20
a bank foreclosure when a bank forecloses, they take the property. If you foreclose on someone's member's interest, you're foreclosing on their interest, but you don't necessarily
Senator Stephanie Flowers
Unverified
8:28
become a member. You become involved
Representative John Maddox
Unverified
8:30
in the LLC under our current law.
Senator Stephanie Flowers
Unverified
8:36
Well, yeah, to the extent of whatever the judgment
is. Yes, but it's only a Monetary interests that Once it's liquidated, maybe they have a right to Get those that value, but I don't see how you can say they're a member, but the other question is vice versa. If So So what you're saying here is
A person cannot Get a judgment against somebody. And then For some other reason, like the car accident. So you can't come into the LLC and try to grab The interest of the member. That's correct. Under this bill, yes, ma'am, that's correct. So
OK, so The charging order lien is based on what? So a creditor receives a charging order
Representative John Maddox
Unverified
9:54
when they go to court and win a judgment. Then you get a charging order against that LLC's interest, against the
LLC. On what basis? It can't be the car wreck. The damages due from the
Senator Stephanie Flowers
Unverified
10:05
car wrecks. No, it can be. It can be, can be, yeah. And so when I went
Representative John Maddox
Unverified
10:10
to take my distribution, not me, but when an individual goes to take their
distribution from that LLC, then a creditor can still come in and attach that under this. They just can't come in and foreclose on the whole thing on the members LLC interest.
Senator Stephanie Flowers
Unverified
10:32
Yes, ma'am. OK, any other questions by the committee members. So
this is standard practice, I guess in these other states you mentioned
Representative John Maddox
Unverified
10:42
Texas yes ma'am. This is modeled directly after the Texas statute with the one
amendment, excuse me, that the bankers asked to make certain that they are protected if they get a
perfected lien against that member's LLC interest. But beyond that, yes, ma'am, it's exactly like the Texas
Senator Stephanie Flowers
Unverified
11:02
statute. So anybody that has a claim against a member of an LLC. No matter for what reason can
now seek to attach that member's interests are foreclosed on that
Representative John Maddox
Unverified
11:20
interest. Yes, ma'am. The statute now says foreclose.
Senator Stephanie Flowers
Unverified
11:23
And you're saying changing it to a lean and charging order and yes
Representative John Maddox
Unverified
11:27
ma'am, and then take a distribution when that person takes money. Yes, ma'am. And so
Senator Stephanie Flowers
Unverified
11:32
it's the responsibility of the LLC. To recognize the lien and if any amounts are paid out to a member that
that would not go to the member but rather to that lien holder. Yes, in essence they would have that creditor would
Representative John Maddox
Unverified
11:50
have a court order basically garnishment against that distribution basically, OK,
Senator Stephanie Flowers
Unverified
11:54
well, when you said garnishment, I can
understand that. Any other questions from the committee members, Senator, what? Well,
Let's see if there's anybody to Here, anything else, Senator Boyd? Is there anyone signed up to speak for or against the bill as amended.
Seeing no Senator Irvin, I take your motion. Most motion by Senator. Irvin do pass as amended and Senator McKee seconds the motion. Any discussion? No. All those in favor say aye. All those opposed, no. I
have it. Pastor Bill. Thank you. Thank you, Mr. Chair.
Senator Justin Boyd
Unverified
13:44
OK, um, Representative Hawk, are you ready to present
Senator Justin Boyd
Unverified
13:51
just banks on its way down. Um Do you want us to do something else noncontroversial while you wait or, OK.
Yeah, we, um, So, uh, Representative McGrew. All right, House Bill 1558 by Representative McGrew. If you'll introduce your no, no, no, we don't do that. You got to come
closer. We respect Chair Johnson's rules when even when he's not here. Um, so if you'll introduce yourself and get started. Thank you, Chairman.
Representative Richard McGrew
Unverified
14:31
State Representative Richard McGru, District 85. Senator Caldwell, I guess got tied up. He was going to present this, but this is House Bill 1558. Uh, I have worked on this bill for
quite some time, worked hard with the Ridge State commission and the Realtors Organization and the Arkansas Landlords Association. And come to what I believe is really a good bill that will will help Arkansas. It does a few things. It, it provides a path by where someone can become a property manager in the state of Arkansas without having to be a sales associate and sales broker and spending 2 years doing that. It also for the first time in Arkansas will require experience and education
and knowledge on property management, which I think will strengthen property management. If you're an owner or a tenant, you want that person that's manning your property to be educated on what the law in best practice is, and that's what this bill requires, keeps it under the State commission under their oversight, it also does require that property managers are put on the website, so when you go to the commission website, there'll be a tab where you can go look at property management and see what there is on that.
The education that required for this life, so to get this this license, it follows very closely to what the the pattern for A sales agent only is it allows a property management broker and also an associate property manager. And it does not change anything on the realtor side doesn't affect them in any way. They can still, you can still manage property as a broker and go that path, or you can choose this path and
And that's pretty much what it does. Again, it's the Restate commission and the realtors are OK with it, and I think it will help grow property managers in Arkansas. There's a lot of people that manage property of their own that now we'll be able to go a path without having to spend 2 years being a sales agent and sharing their property that way. OK, Representative
Senator Justin Boyd
Unverified
16:43
McGrew, thank you for the explanation. What
question? Senator Flowers? OK, representative of a group.
Senator Stephanie Flowers
Unverified
16:52
So you say. Person now who is managing their own property. Well, I mean, what happens to them? Are they affected by your bill? They are not. This doesn't change the
Representative Richard McGrew
Unverified
17:04
law. If you own your own property, you will still be able to manage your own
Senator Stephanie Flowers
Unverified
17:09
property, but if you seek to employ somebody to manage that property. They have to have this license. If you're going to manage someone else's
Representative Richard McGrew
Unverified
17:17
property, you can manage your own. So if you have rental property, you can manage it, but
if you want to manage someone to cross the street or down the road, you have to
Senator Stephanie Flowers
Unverified
17:28
have the license to manage it and presently. now That that's not required.
Representative Richard McGrew
Unverified
17:34
Yes, it is required, but presently now you have to take 60 hours of education on sales, become a sales agent, take that license, place it with the broker, taking continuing education on sales for 2 years, and if you have property, you also have to share that with the broker and then at the end of that two years you've got to take 60 hours of education on the broker's
license and become a sales broker to manage property now. What this bill does is allow you, if you You have 7, you you've been managing 7 units or more, you can take 60 hours of education, so you have to have that experience. You take 60 hours of education on property management. On that 60 hours, 30 hours is on the law and 30 hours on best practices, then you have to pass, pass the test, and if you do that, then you become a property management broker. At that time you can hire associates under you, which can
serve like a two-year apprenticeship under you, and then they can be available to take. The education and tests and during that time they also, they're required a 30 hours of education
Senator Stephanie Flowers
Unverified
18:38
and continuing it. And so initially, After someone gets this license. And they get the 60 hours
of education, law, 30 and sals and 30. Do they have any requirement for
Representative Richard McGrew
Unverified
18:57
continuing education. Yes, ma'am. It's almost parallel to what the sales agents do. They have to take the same, I think it's 6 hours of continued a year that they have to take. And
Speaker 106
19:10
so we're creating a new position. Yes, I wouldn't say, I
Representative Richard McGrew
Unverified
19:16
wouldn't even say it was a new position. We're we're creating a classification on the license to say instead of being a sales broker, your property management broker. You're under the same
rules and laws and all that, but it gives you a path and to me one of the most important things, but two things, it gives someone that really wants to be in property management that doesn't want to spend 2 years in sales, a career path that he can now take. So I believe it will grow because there's a lot of in the Arkansas Landlords Association, there was a lot. members that are managing property and they're their kinfolks and their neighbors are wanting them to manage theirs. They have the knowledge and experience, but they're not willing to go be a salesperson for 2 years. This gives them a path, and it also for the first
time requires actual experience and education and knowledge in property management, I think some of the problems that we're having, the way that tenants are being treated, when the landlord knows what the law is and what he's supposed to be doing in best practices, surely he's going to be better than someone who doesn't have that knowledge and
Senator Stephanie Flowers
Unverified
20:16
experience. And so how difficult is it going
to be for somebody that wants to get into this business to get the experience. So in order to get the
Representative Richard McGrew
Unverified
20:29
so if it's a young man that wants to go into property management because property management is getting to where it pays pretty well to be in property management. My daughter's a property management for a company here in Little Rock and does very well. For a young man that wants to do that, he can hire on to to either a broker who's managing property or a property management broker and serve under him for 2 years. That 2 years gives him the experience to then take that 60 hours and get that education. So he would get kind of like an apprenticeship under any other
trade, you know, if they have no experience and knowledge and they want to get into this, so they would come to, you know, ABC properties and apply for a job and hire on with them and work for today when they did that, they would have to take the 30 hours of education that's acquired by an associate. And passed the test for that and then it'd be hired under that company, and if they served under that company for 2 years, that would give them the experience that they needed to step up to the property management broker. So people that That
Senator Stephanie Flowers
Unverified
21:32
are engaged in property management now.
Without all this certification. Will they be grandfathered in? No, the existing brokers that
Representative Richard McGrew
Unverified
21:43
are property managers, they, they will not be affected at all. They will still be. The people that are that are working under them if they had 2 years of experience of 7 units or more than they can apply for this and take this path. 7 units.
It has to be you get that in the bill, it says you have to have experience of managing 7
Speaker 117
22:10
units or more for a period of 2 years. So is that
Representative Richard McGrew
Unverified
22:13
one unit, one year, no, that's 7 units. So for instance if if I owned 7 units, 89, 10 units of my own, and I had been managing them. That's the experience and I've been managing them for 2 years. That's the experience that's required in the bill. You have to have managed 7 units for a period of 2 years. Why you get 7.
Well, the real estate commission actually said it a little lower, and after a discussion with them, we thought it needed to be a little higher. If you understand property management, if you're managing 7 units of your own and you don't have any help, that's a pretty good load. So you have a lot of experience if you're managing 7 if you're only expanded, I think they had it originally at 4, and we didn't think that was enough. It was 7, it's a little more load, a little more experience that it takes because we want them to
have that experience and know what it takes to manage property along with the education,
Senator Stephanie Flowers
Unverified
23:10
OK. I'm just wondering if that's going to keep. Some people from ever qualifying to even get there. I'm sorry, I don't, the lower number,
I think helps. People who don't have those connections and employment opportunities with your principal broker.
So to me, I wonder if we're some kind of way. Making it more difficult
for people than it needs to be. By saying 7 units. What we want to make sure that
Representative Richard McGrew
Unverified
23:49
they have they're going to be responsible for managing other people's property, you know, they don't have to have any
experience of manage any if they just want to hire onto one of these companies. I
Senator Stephanie Flowers
Unverified
24:01
understand, but what I'm saying is if
if a person has been managing property, not 7 units at
one time, but over a period of years they've handled maybe 4 units
are even one. I can see one for like. 1020 years, I mean, why, why wouldn't they
be able to get this managing one is more like a more
Speaker 118
24:30
it's not, it's not near as difficult as managing multiple
Representative Richard McGrew
Unverified
24:39
units and really 7 is a pretty low number, you know, when you look at property management companies,
Speaker 115
24:45
excuse me apartment building that has several units. Well, if it has over
Representative Richard McGrew
Unverified
24:49
7 units, that meets the qualification. So it can be an 8 unit department house and you got it.
7 unit apartment house, then you have it, you know,
Senator Stephanie Flowers
Unverified
24:59
most of your apartment managers are gonna qualify to get this. Yes, ma'am, if they
Representative Richard McGrew
Unverified
25:05
wanted to take this path and take the education and now I
don't think, I think to me it's more likely people that own their own property and are doing it rather than someone that's managing, but someone that is managing, you know, if they're managing a big apartment complex here in Little Rock, and they've been doing that for years, and they wanted this path, they can. Are they gonna be
Senator Stephanie Flowers
Unverified
25:28
bunded or is it gonna be requirement for bonding
and Some kind of protection for the for the public. Well, the, there is the um And the
Representative Richard McGrew
Unverified
25:41
I can't remember the name of the fund that the Read State commission. They're under that. They recovery fund. So if they, they file, we talked about that when we were working with the commission. We initially had a fidelity bond in here and the British Standing Commission wanted to take that out and put it under under the recovery fund because aidelity bond only took care of the money. It didn't take care of one of your people did something wrong, and the recovery fund does, so they're protected under the recovery fund just like they are now. with the brokers.
Speaker 135
26:12
So Senator Flowers, I have another question. Can we come back to you? Yeah
Speaker 136
26:19
just followed through on this last question. So, So
Senator Stephanie Flowers
Unverified
26:26
The insurance or the fund you were talking about. They get their
money back that they've been out of as a result, and they can lose their license.
Representative Richard McGrew
Unverified
26:44
the property management could lose their license, absolutely if they did something wrong, yes, you know, it could be, you know, they could run off with the deposits. Or and this has happened, the fact the two biggest payouts in the state commission recovery fund have been in property management. That's why to me this bill is important because I think those payouts are because they didn't have the education and knowledge of what the law is and all. This will, at the minimum require that. OK.
Speaker 141
27:12
Thank you, Mr. Chair. Thank you, Senator.
Senator Matt McKee
Unverified
27:16
McKee. Thank you, Mr. Chair. Uh, I just want, just so I understand this bill reduces existing barriers to entry into this niche part of that market allows more people to get into that industry. Not with less oversight but with perhaps You're saying you don't have to go out and learn how to sell property in order to be a property manager. Is that basically the kind of the way that I would say it because of construction trade. Currently what we're doing now, I'm an
Representative Richard McGrew
Unverified
27:46
electrician. We're kind of saying you're going to be a carpenter for 2 years before you can be an electrician. That's what we're doing now. So that's what we're doing. We're saying you've got to be a sales agent, and not only do you have to be a sales agent if you want to take that path in your own property, you've got to share your property with that broker for 2 years. Give him part of your money, so this takes that away and a blouses a path, and I think that the result will We, we'll have more Arkansans managing property. These big out of state property companies. There's a gentleman that testified against this bill last
year, and he wanted to take this path. He couldn't do it. There is a waiver of which you can do that. I think he was number 8 in the state of Arkansas that got that. He's got that that young man is in Hot Springs, Arkansas managing over 1000 units now. Where some of those units were being managed from out of state companies, so it helped Arkansas. Thank you. I'm
Senator Missy Irvin
Unverified
28:40
so glad that you didn't give up on this bill, you know, because I supported your bill and I'm so glad you didn't
give up on it and because it's a really smart bill. It's a really good bill, and it's a very smart bill. One of the things that I brought up, you know, 2 years ago is that I have a daughter with a master's in construction management, a master's degree in construction management with a bachelor's degree in architecture, and she would have to become a licensed real estate broker in order to manage. An apartment complex that she just built, which was crazy to me, so I hope that, you know, I think this is a great thing. I
think as we're getting more construction management, bachelor's degrees, master's degrees out there into the workforce that we should be able to let these, these, this group uh consider that as, you know, part of the experience. I'm not sure if that's in your bill, but uh I'm, I'm supportive of your bill. I'm going to vote for your bill, but moving. I'd love to see like that level of education being, you know, utilized instead of that plus on top of a master's degree, you
know, you have to do additional things, so I, I, I think that would be something you,
Speaker 153
29:52
you could maybe include in the future it's not included already and this will provide a
Representative Richard McGrew
Unverified
29:57
career path that for people now that don't want to become the sales. Currently, one thing I did mention right now today if, if I had and you say in the past I had over 400 units. I'm getting old. I've sold off. I'm way down, kind of getting out of it. So this is not for me. I'm not interested to manage your
property, but when I had those 400 units in 20 years of experience of doing it, if you wanted me to manage your property and I had, I had leasing agents. I had maintenance staff. It was a felony for me to do that. So this helps in that way. Senator Flowers So Representative group,
Speaker 156
30:40
you mentioned uh somebody was able to get a waiver.
Representative Richard McGrew
Unverified
30:49
There's a waiver in their existing in the real estate commission now. It's hardly ever used, and it says if you have 2 years of experience managing property or it doesn't have to be property. It can be selling real estate. You come from another state or whatever. It's a way to waiver all that 2 years and you can directly take the broker's test. It's only it's, I do not like it because Actually to be, I have that that
waiver. I was number 7 to get it in the. I don't like it because it, it lightens me if I want to, if I want to be a sales broker now. I can go open office of a sales broker and being in competition with the sales broker, and I have no knowledge and experience about that. They gave me the waiver based only on property management, and it's lasting me to do other things that I don't know what I'm doing, so no, I'm not in favor of that waiver, but that is that taken out of your meal, that waiver is not in my bid. It, it's something that
Speaker 138
31:51
already exists, so you're not trying to repeal
Senator Stephanie Flowers
Unverified
31:59
that, no, no, so you're going to let that stand this comes along like you
Representative Richard McGrew
Unverified
32:03
did. Do what for somebody that comes along maybe like you did. Well, this, this allows someone like me. Yes, 15 years ago I tried to become a
property manager. I had all those units, and when I went and took the 60 years of education for sales agent and then when I studied the part the last day of the class about
Arkansas law, and it said you're going to have to put this license with the broker. I went to a few brokers and said, what are y'all gonna require? The least expensive one was 5% of my units they wanted the money even though some of them had no experience and knowledge in property management, so I didn't do it. It blocked me from doing it. That's part of the purpose. This is not for me, but this is for a path for people in that position, and there's a lot of them out there can become property managers and manage the property. They got the skills
and knowledge and and the ability, this allows them to get the license, but to say you've got to go do something. for 2 years and share what you've worked on for years with them blocks up a lot of people from doing this, and this opens that path again. It will strengthen property management by requiring knowledge and education and experience, and it will make more Arkansan property manager because it creates a path a better, a more career path for more of
our young people that want to do this. And last question Mr. Chair, how
Senator Stephanie Flowers
Unverified
33:25
long would that person that's, uh, aspiring to get
this license, have to work with that. broker if they have no experience, 2 years, 2 years. Consecutive
Representative Richard McGrew
Unverified
33:33
years, back to back. What it doesn't say back to back. It just said 2 years, so I guess you could do a year and take a year off and take another year if you wanted to. OK, thank
Speaker 160
33:48
you. Thank you, Mr. Chair. Any other questions? There's no
Speaker 161
33:52
one signed up to speak for or against the bill. Um
Speaker 135
33:57
You want to close your bill? Yes, thank you very
Speaker 161
34:04
much and I'm closed. Uh, what will the committee motion by Senator Johnson, everybody seconds it. All in favor say aye. All opposed likean. Thank you, Senator. Thank
Speaker 135
34:16
you very much. It's been a long path. Thank you so much. Are we
Representative RJ Hawk
Unverified
34:36
Introduce yourself and you're welcome to begin. Thank you, Mr. Chair. Representative RJ Hawk, District 81. Representative Matthew Shepherd, District 97. You Senators, today we bring you House Bill 1634 to create the Arkansas Sports Rifle Act. This would allow for Arkansas universities to be able to hold raffles to help with fundraising efforts for NIL purposes, scholarships, general support of the institution's athletic team
or program and maintenance and construction of facilities. Currently there's more than 50 universities and colleges across the country they're allowing for their universities to hold raffles. Some of those school those schools include the University of Missouri, Texas, Oklahoma, Tennessee, Florida. Kentucky and Georgia as well as Ohio State and Arizona. Um, you know, we've been working on this now for a little over a month, and in that time, I've heard from the smallest of the small schools in Arkansas all the way up to the University of Arkansas
and how this would dramatically help them in their fundraising efforts on all aspects, whether it be for those NIL purposes, whether it be just for general scholarships or even building funds at those universities. During that time, Representative She and I got together on this bill and we made some changes originally this bill was House Bill 1044. We made some changes to put safeguards in the bill. So on page 4 line 35, you'll see where we added reasonable age
verification, uh, page 5 line 3, I apologize, yes, page 4, line 35, has reasonable age verification. Page 5 line 3.
Say that these raffles are going to be governed by Amendment 84.
And then page 5, line 6 says that DFNA may promulgate rules for these raffles. And so by doing that, um, we've
already got raffle laws on the books. Amendment 84 is going to help govern this, and so we are just extending this to our
universities to help with the fundraising effort. I know there's going to be people that testify for or against this thing that say it's a gambling bill. This is a fundraising bill. Our churches are already doing it. Our 501c3s are already doing it and so we are allowing for our universities to be able to have a fundraising mechanism at the universities to help raise money for our student athletes, no matter how big or small you are in the state of Arkansas, and with that I'll take any questions.
Senator Missy Irvin
Unverified
37:12
Senator Irvin. Thank you. I went back and watched the first round of testimony on this bill and House rules, and one of the things that was mentioned or brought up in language, and you may have fixed this or addressed it was, you know, the utilizing of third party vendors, and so I think the way you had it written was actually testified to that it was some company out of Canada, but that then, but then there was a loophole because they were
connected to a casino, so, um, did you resolve
Representative Matthew J. Shepherd
Unverified
37:49
that issue? issue So Senator, And I went back and watched the committee that first committee meeting as well. I was not initially involved in the original bill and then Representative Hawk and others asked me to to work on this when we brought it back. So, um, I think that I think that with regard to what this bill does and the change that was made,
the original bill said that casinos could not. Conduct or could not otherwise administer. Um The raffle, but under Amendment 84 that was already essentially provided for that a third party couldn't conduct a raffle, and so it was kind of a, it was almost a moot point and so that's one of the things that we went back and changed and in the current bill you'll see that it says something of the effect that a third party can't conduct or otherwise administer a raffle. They could contract with a company to provide technology
to provide to to uh to be able to, to operate the raffle, but they can't outsource that to a third party and so this bill makes clear whether it's a casino or somebody else, it can't, it can't be a third party, and that's something we have a representative representatives from the University of Arkansas at Fayetteville. The AG's office is here as well. That's been a point of a lot of discussion because I think people when I started working on this after that first bill originally the way I started looking at it, I
thought we were going to head in a completely different direction, but then When you read Amendment 84, Amendment 84 is so tight as to what can or can't be done, that it's, that it, it really brought home to me that the only way that this could be done is by way of what we have here and that the entity that is conducting the raffle, they're the ones that have to conduct it. They can't outsource that. Now they can, they can, uh, you know, Contract to utilize technology
or other things, but they can't outsource that raffle, and so I think we've addressed that in a way that is consistent with Amendment 84. I said on the House end that if you ask me to, to draw, to draw up a sports raffle bill, and he said just go write one, you start from scratch, you don't have any constraints. This probably isn't the bill, but if you ask me to draft a bill that complies with the Arkansas Constitution based on on what I've looked at based on my conversations with the Attorney General's office and relying in large part on on
what they've said as well. We feel like we have a bill that complies and there's going to be things that they that people can't do, but that's because of the amendment of Amendment 84, and so I think we've addressed
Senator Missy Irvin
Unverified
40:34
that issue. OK, so just following up quickly, so, so, so a casino could be a third party
Representative RJ Hawk
Unverified
40:40
vendor. They could in this case they could give their technology to the university and the university
could use their technology, but the casino could not run it, and that's because of Amendment 84, understand, and
Senator Missy Irvin
Unverified
40:52
the uniformly to everybody. And can you point to where in the language of Amendment 84 that you're
looking at. I mean, I've pulled it up. I'm reading
Speaker 186
41:01
it right now. It's Amendment 84. It's a Let's see. So it's
Senator Missy Irvin
Unverified
41:06
going to be on section 3. Or or number one. Back.
Speaker 192
41:43
And if you want the AG's office, they can
Senator Missy Irvin
Unverified
41:47
answer that they may be able to find I'm, I'm reading Amendment 84 right now, and I just would like to know the
Speaker 193
41:55
specific language that you're utilizing. If the AG's office would come to the table. You don't
Senator Missy Irvin
Unverified
42:00
have to stand halfway up. I just want to know the specific language and a Amendment
Speaker 165
42:06
84 that you're All right, please introduce yourself and interject. Alex Benton, AG's office.
Speaker 194
42:15
Senator Irvin, I am looking at And Excuse me, Amendment 84, and you have to look at
Speaker 197
42:25
first A one on authorized bingo and Raffles organization, and that is a defined term that means that it must be a nonprofit tax-exempt religious educational veterans fraternal service, you know, an enumerated list of of things that are authorized organizations that may conduct these raffles.
And then you go down to B1. And it says that the game of bingo or raffles conducted by an authorized organization shall not be lottery and all of these things, OK, so it's, it's
Senator Missy Irvin
Unverified
43:02
a combination of 1 and 3B1.
Speaker 197
43:05
That's right. Then you go to see and it talks about these authorized organizations to conduct the game of bingo or raffles, so it's using that defined term and that's found in one. Yes, ma'am.
Speaker 204
43:18
All right. Thank you. Thank you, Senator Flowers, and then uh she stay at the table, please.
Speaker 207
43:38
I don't have the entire. Amendment 84 in front of me,
Senator Stephanie Flowers
Unverified
43:42
but is there a section that says no receipts shall be used to compensate in any manner, any
person who works for or is in any way affiliated with the authorized. Bingo
Speaker 194
43:56
and raffles organization. Yes, Senator, that is in Amendment 84 Section 1, subsection B. Be
Senator Stephanie Flowers
Unverified
44:05
too yes Be too yes and so if you, if
you say Uh I see in the findings,
uh, something I guess it equivalent
to NIL. Is that uh Raising the public image is that
of those athletes in the university. If you use it to pay the app.
How are they not affiliated with the university. I, well, I think if she You're with the AG's office. I'd
like to have your take on that because I'm looking at an AG
Speaker 197
44:59
opinion too. Uh, a 2007 AG opinion. Yes, ma'am, I'm familiar
Senator Stephanie Flowers
Unverified
45:03
with it. It says, in my opinion, the phrase in any way. has the
effect of expanding the phrase. Affiliated with. To its broadest reasonable meaning. So how, how are
you? Getting to where this is
Speaker 194
45:24
constitutional. Yes, ma'am. So I think you, you've really touched on
Speaker 197
45:29
one of the, the more confusing aspects of this and the answer is that I think that under the 2007 AG opinion says the broadest way that you can define in any way affiliated with that is reasonable, and I think that that is the key here. I think that it's reasonable to assume But an employee or a contracted
party that contracts with the C3 organization who has to conduct the raffle. Would be affiliated but a student athlete is not an employee of, let's say, the foundation that supports um it's the foundation that has to conduct the raffle on behalf of the university, and so a student athlete is not affiliated with the separate 501c3 foundation. They're not an employee. They're not contracted with them. Yes, the foundation certainly is formed and its intent is to
support those student athletes, but it would be a similar reach to say that because somebody purchases a ticket to a sporting event that they are now affiliated with that student athlete. There's, there's too many intervening organizations in between the student athlete who works, who is a student athlete for the university and then there is a separate organization, the 501c3, that would conduct the raffle under
Amendment 84, so you have Enough space and enough legal organizations that are in between to where you could not reasonably say that
Speaker 224
47:07
a student athlete is affiliated with a 501c3 foundation and that's going
Representative Matthew J. Shepherd
Unverified
47:13
to be fact intensive for each university in each situation because and and again this goes back to the to what I was alluding to at the outset, Amendment 84 has pretty tight constraints and so we're
operating, trying to operate within the confines of Aimin. before, but it's ultimately going to be a fact intensive analysis because the University of Arkansas at Fayetteville may operate in a different manner than some other institution and so that's going to be have to be evaluated on a case by case basis, but ultimately what we're doing is as much as we can do, and it may, it, it could be that there may not, you know, for a certain institutions it may be that there's not a way to operate in such a way to utilize
for NIL, but there are many other, if you look at page 4, there are a number of different things in which an institution could utilize those funds to benefit their athletic program, and so ultimately we're not making anybody conduct a raffle. That's going to be up to those institutions. We're just simply providing a pathway to allow that raffle to be conducted under Amendment 84 and creating somewhat of an exception to what currently exists. The statutory scheme that currently exists with regard to bingos and raffles. But then why not?
Senator Stephanie Flowers
Unverified
48:31
For the sake of having a Better bill Just strike Any Reference to that. athlete And anything that you can kind of call NIL. Name, image and likeness. Why not just keep the language. For General purpose. That would be better and that would keep you out of court.
Representative Matthew J. Shepherd
Unverified
49:02
Well the university is out of court. Well, that's going to be a judgment call for them to make. I mean, as we all
know, the universities have, they have their own set of attorneys that will evaluate things. We have the AG's office that has weighed in on this. The AG's office actually helped develop this bill, and so they contradicted themselves. Well, we're trying to provide a pathway for NIL, and we understand, we understand, and actually this bill was worked on with Mr. Safa and Saracen and A number of other individuals that expressed interest in this,
and so this is, this is an agreed to bill. I want to make that clear. I believe I'm not going to speak for Mr. Saffa, but, but he spoke for this bill. We understand and we've had discussions. I understand the concerns related to to NIL, but also this is the best we can do. We're trying to provide that opportunity. The AG's office feels like it is a good pathway forward, but again, each institution will have to make that judgment for themselves and So, you know, we feel like we've done the best we can and Senator Flowers, I would, I would also
Representative RJ Hawk
Unverified
50:02
say when we initially started working on this bill to Representative Shepherd's point, not only did we get the AG
involved, but we also got the major universities in the state. So the University of Arkansas UCA ASU all got involved and said, Hey, we want to help. And so they got their legal attorneys involved and so they
were the ones that also said we want the NIL purposes in here as
Speaker 161
50:23
well. Senator Flowers, I need to go to two other other senators and I'll come back to you, Senator Johnson.
Senator Mark Johnson
Unverified
50:32
Thank you, Mr. Chairman and Representative Shepard and Representative Hogg, thank you for your hard work on this. I think it's a good bill. I remember when this amendment 84 was brought up. That was Representative Shirley Borehauer's amendment, and she worked very hard on it because she wanted to make sure that it was properly done and we had a problem, I guess I can say, call
it a problem where we had cases of people that I would refer to as professional gamblers that would come in to say a FW American Legion Hall and say, hey, I'll come in, I'll set this up, and I'll run bingo and they don't think people were running raffles, but they could, I guess they could, but Raffles were a little more controversial at that point, but the bingo, which is put in the, the problem was to make it clear that this was for
charitable organizations and that someone couldn't under the guise of the VFW, for example. come in and run a gambling operation in a private club of the VFW and then turn around and take 85% of the money for themselves and give 15% or less maybe to the charitable organization and she purposely wrote it the way she did to avoid that kind of problem, but
it made it clear that the VFW in that case, could run it. They couldn't farm it out to a pro, so to speak. Now what I'm hearing a question and y'all correct me if I'm not seeing this right. In the case of one of our universities, they would operate it, but there would be nothing to keep them from, let's say it's bingo just for purposes of explanation. Uh, the, the company that they leased the the machine with the
lights and the ping pong balls and the blowing around and all that. Uh, that wouldn't constitute farming it out or or subcontracting to another entity that would just be a vendor of a product or software or hardware to facilitate that no different than the person that rents the chairs for people to come in for the bingo. Am I reading that right, Representative Hall? I think the biggest thing about this is that the
Representative RJ Hawk
Unverified
53:01
universities have to run it. They can go to anybody and get the software, right? They can go or hardware
or hardware, the universities. or the organization, the 501c like a foundation would have to run these at the end of the day, we don't, the universities themselves have said we want to be able to do this in-house. We don't want to have somebody else putting their hands on this, we'll be glad to buy their software. We'll be glad to do whatever. There's other,
here's the other thing, there is not a university in the entire country. Of those 50 that I, you know, some of those 50 that I named that don't do it in-house. They don't farm it out to a casino. They don't farm it out
to anybody else. They all do it in-house. In fact, there's over 120 professional teams that also do raffles currently that don't farm it out. They all keep because if you start letting somebody else to handle your, your proceeds and do other things, then you've got too many hands in the kitty, right? To your point just a moment ago. So the, so the universities themselves want to handle it. They'll buy the software and they'll they'll work with that third party to buy that software or a printer
Speaker 237
54:02
to print tickets or whatever and the other big thing about this
Representative RJ Hawk
Unverified
54:05
bill is I know that there's been people talk about
the 50/50. Raffle, right, but I heard from like Henderson State University the other day, and their budget for baseball right now is very small, and he said, you know what, if we could hold a raft, one of our sponsors gives us a truck that we could raffle off, and the proceeds from that raffle, we could use that for our baseball travel budget for the for the football or for the baseball program. That, you know, I know everybody, the
University of Arkansas is in the room. Everybody thinks about that, but I, when I was doing
this bill, I was also thinking about the UAPBs or the UCAs or the Southern Arkansas, these schools that don't have large budgets and they're trying to pick and scratch and get everything that they can just to make a little bit of money so that the baseball team or the tennis team has the same, same advantages as the football team. They still get to ride the nice bus or get to stay at the hotel or have a, a meal. That's all we're doing here is just giving them another opportunity. They don't have to do it if they don't want to, OK, so if
Senator Mark Johnson
Unverified
55:07
the the and Mr. Chairman, if I could
direct This question, I guess to please, please make it I'll be we
need to go on to the AG agrees that this is not under Amendment 84. And that's That's OK. So everything reviewed by the Attorney General's office is that this is proper under Amendment 84. Yes sir, that's correct. That's all I have. Thank you, Mr. Chairman. Thank
Speaker 160
55:33
you. Thank you, Senator Murdoch, and then Senator Irvin, and then we'll go back to
Senator Reginald Murdock
Unverified
55:40
Senator Flowers. Thank you. Thank you, um. Mr. Chairman, appreciate you guys, um, how representative Hawk and a shepherd for bringing this. So I thought I was OK, a little confused. Help me with something right quick straighten me out. So Amendment 84. Talks about the student athlete not being affiliated with the entity that's running the raffle. In this case,
We're saying, so, so the square this for me, the student athlete is affiliated with the university and the university runs runs the rifle itself and not a third party, then how does that not violate 84. Senator, I'd be happy to take
Speaker 197
56:30
your question. So there in your hypothetical, if the university were to conduct the raffle and not the C3, not the foundation. It was the university that's conducting it. Then under
Amendment 84, the fund those funds raised would not be able to go to NIL because the the athlete would be affiliated with the
Senator Reginald Murdock
Unverified
56:52
university. OK, stop for a minute. Let me come back to you now. But you said, if I understood you correctly. That this
is, this allows for the the the universities to run it themselves or they have to run if I heard you correctly, run it themselves. So,
Speaker 245
57:05
so, so basically the NIL piece right now in the state of Arkansas, there's really
Representative RJ Hawk
Unverified
57:10
only two major schools in the entire state that do NIO. That's the University of
Arkansas and Arkansas State. Most of the smaller schools that you talk to, they aren't paying an Iow money to their athletes. So while the NIL piece is in there because like the University of Arkansas is going to let their foundation run this, right? To be able to pay NIL Henderson State could have run a raffle, right? And it wouldn't go for an aisle purposes. It may go for their travel budget or it may go for facility upgrades, things like that. That's why we also have in the bill that it says for maintenance or construction of facilities, general support of the institute's athletic. The
NIL piece, there was a comma after that, and that was basically to help support like Arkansas and Arkansas State who do practice
Senator Reginald Murdock
Unverified
57:54
in NIL. So stay with me in this thinking. A major purpose of this bill. Obviously is for NIL. We're trying to compete with The other SEC school whoever across country, but we also want to give, so let's you give an example, UAPB has an outstanding athlete. They're conducting a raffle or
they're small, as you know. How is this going to protect them from the State University of Arkansas. So my apologies being able to. Come and Get their good at because UAPB can't use it for this fifty-fifty money for, if I understand it correctly, for NIL because they're running it themselves. But Arkansas University of Arkansas is As a third party running theirs,
so you understand the difference um it seemed like big big big brother taking little brother,
Representative Matthew J. Shepherd
Unverified
58:53
help me with that. Well, number one, it opens up a potential revenue source for UAPB
Senator Reginald Murdock
Unverified
58:59
that does not exist today. No,
Representative Matthew J. Shepherd
Unverified
59:02
no, just keeping an athlete from being OK. We also understand that probably for the smaller institutions, well, for any institution, there is only so much money that they or any supporting organization could raise from donors, right? Well, I think there is some
benefit to UAPB is they can use the raffle. They could use that for facility needs. They could use that on page 4. There's a number of different things that could be utilized for facility needs, and if they have a collective or other entity. In fact, I guess the way it's moving now, the institution could actually pay NIL of some portion format, Mr. McCoy from the UFA probably could speak to this. They're able to raise money through the raffle, and they can use that on facilities. Well, guess what? That may free up more money that they're able to utilize if they want to free up some money to
pay NIL or to have donors that they otherwise would be having to to reach out to for facility upgrades they could hopefully encourage them to support their NIL program, so it's, it's a win-win. The bottom line is, and I understand the concern about the NIL. The NIL issue is an amendment 84 issue. Why wouldn't we include it in here to provide that opportunity. It's going to have to be evaluated on a case by case basis, facts by facts, based on the institution. So why
wouldn't we, especially when we have the Attorney General's office saying that they believed that under the right circumstances it can be utilized, but this is, we're not making anybody conduct a raffle. We're opening up the opportunity for every institution. So it's, it's a win, and that's why I'm supportive of it. because it benefits all institutions, right? And lastly, I think it benefits
Senator Reginald Murdock
Unverified
1:00:39
certainly the major purpose is what we talked about is for the university. Arkansas will be able to compete, but what you have done.
With the 50/50 in allowing the smaller schools to do this, it's created a stream, as you just
said for them, for other reasons. It won't, you know, it won't do nothing for their NIL which they may not be able to participate in anyway at a large level, but it will help them with facilities and other things that they can do, so I understand what you're saying. That's right because there's
Representative Matthew J. Shepherd
Unverified
1:01:09
donors that come into their institutions maybe at the ballgame. It has to be tied to a ballgame that sure they're buying a ticket, they may show up to the game. This is providing an opportunity to to raise additional resource.
is based on this raffle that's going to benefit the
Speaker 254
1:01:26
athletic program. Thank you. Thank you, Senator Irvin. Thank
Senator Missy Irvin
Unverified
1:01:30
you. Question for the Attorney General's office, I think I just, there's been some discussion about what the legislature's ability is on amending the Constitution of the United States of the state of Arkansas. Yes, Senator, and I don't think
Speaker 205
1:01:44
that this bill attempts at all to amend the Constitution, not
Senator Missy Irvin
Unverified
1:01:47
ask him about the bill. I'm asking about the position that the Attorney General has taken
about amending the state constitution. Has he issued an opinion about what the legislature's ability is or is not in amending the Arkansas State Constitution. Yes, ma'am. And what is
Speaker 194
1:02:07
that? Um, I, I apologize. I have read the opinion. But it's been many weeks since
Speaker 197
1:02:13
I've read that opinion, and I'm, I apologize that I'm not prepared to to be able to adequately and accurately summarize the contents of that
AG opinion for you today, but I'd be happy to that for you I mean, just, OK, yes or no, yes, yes, we can under Amendment 7 that the legislature may amend the
Senator Missy Irvin
Unverified
1:02:38
Arkansas Constitution. OK, so then if under that opinion of the AGs under Amendment 7 that the legis does have the ability to amend the Arkansas Constitution was that now this is to the bill's sponsors, was that ever considered in amending using our ability as a legislature to
amend Amendment 84 to allow for Arkansas-based casinos, companies, businesses to be able to participate in this
Representative Matthew J. Shepherd
Unverified
1:03:04
arena. No, because not because the, during my time here in the legislature for 14 years, I know there has been discussion of Passing legislation that might set up kind of a test case for that authority, but, but the common practice for, I think for most of us here is that we attempt to draft legislation that complies with the
Constitution as it exists as it exists, and quite honestly, just that's been the practice, that's the way that I think that I've always tried to approach it is we're going to try and comply to the best of our ability with the Arkansas Constitution, and we didn't feel like this was the case. It just didn't seem like the
case to try to set up some kind of constitutional challenge and
Representative RJ Hawk
Unverified
1:03:48
the reality of that is we still allow for the casinos if they want to sell their their technology to be able to push this to our universities, they can still be involved through
Amendment 84. The other part of this that we're not even talking about, just let me finish with the other part
we're not even talking about is that if let's say the one person that opposing it, this is Saracen Casino. They sponsor everything at the university as it is at the University of Arkansas. So there's nothing to say that if the university is running this, that they sponsor it like they do everything else that they could push this through their app to to then translate people to the University of Arkansas website. Thank you. Let me ask the question. Representative, I'm
Speaker 141
1:04:35
to our members. I apologize. Thank you, Senator Ervin.
Senator Missy Irvin
Unverified
1:04:39
Thank you, Mr. Chair. My question is really very, very critical because this legislature has picked, it has, it is picking and choosing where to do that with the Arkansas State Constitution. There have been plenty of areas. Within this legislature there are current efforts to utilize
Amendment 7 to amend the Arkansas Constitution, and that is by choice and caveat of the legislature and the issues that they are pursuing. I know that Senator Johnson, I'm looking at him because we've had this discussion before about medical marijuana, for instance, all these different types of ballot ballot initiatives or legislative that have gotten into the Constitution, I think it's a critical discussion to have
because at the end of the day it was a choice that was made by the sponsors of the bill, not to pursue amending Amendment 84 given the legislature's ability to do so. And as I, I mean, yes, I guess that would be a yes. That's that was just your choice.
Representative Matthew J. Shepherd
Unverified
1:05:46
I'm not sure that that's been absolutely determined that the legislature has that ability, but I'll go on record as saying that I draft
legislation, I attempt to draft it consistent with the Arkansas Constitution. OK, well that would be you individually,
Senator Missy Irvin
Unverified
1:06:01
but I know other legislators don't have that perspective. Is that a
Speaker 250
1:06:06
fair statement? I can't, I can't speak
Representative Matthew J. Shepherd
Unverified
1:06:08
to that. I know there's been discussion but not to me. There's not been discussion recently on
Senator Missy Irvin
Unverified
1:06:14
that point. OK, well, it's a question that I've been really pondering through this whole discussion on this issue is we're using Amendment 84 as our debate and our defense for why we're doing the bill the way we're doing it. However, I know for a fact that there are
legislators that are changing the language in the state constitution on other issues. And so that was a just conscious choice that was made. And so I think it's just an important part of the
Speaker 161
1:06:45
discussion. Thank you. Thank you, Senator Irvin. I'm going to ask that we stay on this bill and I understand Senator Ervin's point and, and also Senator Johnson has worked on that quite a bit, but this bill is trying to work within
our Constitution, not amend our Constitution. That's a discussion for another time, but if, if Senator Johnson would like to give some clarity because he has worked on those things just, just keep it short and to the point. Thank you. Thank you,
Senator Mark Johnson
Unverified
1:07:18
Mr. Chairman, and I will try
to keep this short. First of all, uh, Senator Irvin, the opinion you were referring to was issued, I believe, in November. It was requested by Senator Dodson and the AG opined
that Amendment 7, which had been constrained by the 1952 Edgmond decision that basically declared, and correct me if I'm wrong, Alice, that the Edgemon decision was probably probably incorrectly determined and that that provision in Amendment 7 that allow 2/3 of both houses to amend any measure passed by the voters, which we of course know definitely applies to under
current interpretation under foreign initiated act but would also extend to constitutional amendment that had actually been voted on by the people, not the original corpus of the 1874. However, And to bring us back to this bill, I have, I looked this over and kind of tried to test the thing that Senator Irving was asking about Representative Hawke, and it's not my, and again, I'm not an attorney, but I have looked at this quite a
bit, uh, the fact is that uh it appears and AG's office concurs that this is not, this is an Amendment 84 compliant bill because the purpose was, and I'm going Go back to my VFW analysis analogy that I used. Uh, you wouldn't say that, uh, you'd have to be a member of the VFW Club to run the bingo if you were a member of the ladies auxiliary of the VFW Club. You
could also help out running that in my interpretation, but you wouldn't be able to go higher Joe's bingo business to come in and run it and take the lion's share of the funds, so I'm, I'm comfortable with the constitutionality of your bill, even though I absolutely appreciate Senator Urban bringing this point up. If there was any uh something that was unclear, I think it would certainly be possible for 2/3 of
both houses to tweak Amendment 84 to make it clear that it did not apply or in a case where the affiliate is the Ladies' auxiliary or the University of Arkansas Foundation or the Razorback Foundation, so that's, I hope it help clarify, Mr. Chairman.
Thank you, Senator, Senator Flowers, do you have any further questions? Thank you for asking, you know, it's, it's
Senator Stephanie Flowers
Unverified
1:10:08
I, I'd like to just say to the sponsor representative. Sarah could see Sarah's in casino. That's my constituent. And Uh I don't know a better
way to put this, but sounds like you're trying to throw some shade. Which I don't appreciate.
Uh, they have a right to speak. Have their position. I don't think they've done anything to harm or do anything to To undercut your Your efforts But we are
saying that Amendment 84. would be Better Complied with
are complied with by changing the language, striking the language. Referencing that name, image and likeness. And just saying general purpose. And I don't understand why
you have a problem with that. Because And as the AG's office has indicated This 501c3 foundation of the university.
Running the raffle and that making it. Constitutional. The foundation obviously was set up for the
university. So, you, you have to show that's a thread. Threading that word and in the broadest sense. To be used affiliated. And that's what the AG's opinion said in 2007. I don't see how you get there. Uh,
I don't, and I don't see another. AG's opinion since that one. Making it any narrower. So all I'm saying
is, why would you risk litigation. Challenging the constitutionality of this when it can be simply
Stated General purposes. Thank you for the question, Senator Flowers, and I did not
Representative RJ Hawk
Unverified
1:12:39
mean to offend you in any way, shape or form. We we've had multiple conversations with
Says, and they've all been good. There's no shade being thrown. I apologize for you thinking that, um, to answer your question, I'm no lawyer either. I'm a guy that raises a lot of money for charities, and I saw an opportunity to help our universities and whenever I, when I worked with this, I worked with the legal counsel at the University of Arkansas. The legal counsel at the Attorney General's office. and they were the ones that told me to write the bill this way and so I'm basing the language in the bill based on what the
legal counsel at the Attorney general attorney general's office told me to put in here and so that's, that's why it's written the way it is. And the
Senator Stephanie Flowers
Unverified
1:13:24
university's legal counsel, ma'am. Are they here? Yes, ma'am. Mr.
Chair, I'd like for them to come to the table and And tell how they. Absolutely.
Speaker 230
1:13:40
Somebody on the in the queue? No, it's it's fine. Just go ahead and introduce yourself
Matthew Mccoy
Unverified
1:13:46
and, and you're recognized. Thank you. My name is Matthew McCoy. I'm the senior associate general counsel for the University of Arkansas. And in that capacity, I not only represent the University of Arkansas at Fayetteville, but also represent Pine Bluff, the University of Arkansas at Pine Bluff, Monticello, and our other schools across the UA system. Um Happy to answer any questions that you, you
Speaker 277
1:14:12
have about at least what we were able to assist with.
Senator Stephanie Flowers
Unverified
1:14:17
Well, I'd like to hear your take on how this complies, the bill and the
language in terms of that uh Athletes may be affiliated with the university or even the foundation, nonprofit foundation. How, how did you arrive at your uh Final analysis that this is compliant with Amendment 84.
Absolutely, and I think that's, that is a very
Matthew Mccoy
Unverified
1:14:43
good question because as I shared in the
And the House Rules Committee, I bet I looked at 9, 10 different versions over the last 6 years of raffle bills that were attempting to comply with 84 and as uh Representative Shepard pointed out, it's, it's not easy. It is threading a needle, but in this particular instance, the way that this is outlined. And I can walk through. I've got, I've got some unique insight as Senator Johnson has. I was in the Attorney General's office when this opinion was written.
Deputy Elena Wills was one of my colleagues. At the time I was the state's education lawyer over Lakeview, and I was also the gaming point lead attorney in the attorney General's office. I'm very familiar with the history of this. I defended the scholarship lottery in front of the Arkansas Supreme Court. I also defended the electronic games of skills legislation that allowed and later led to our casino and gaming legislation.
So I'm, I'm very familiar with this particular issue. What I will say about that particular opinion, if you go back and look at it, it was issued in in February of 2007. In January of 2007, that's when the amendment became effective. The the last paragraph of the amendment points out the general assembly shall provide by law for the licensure and regulation of authorized bingo and raffle organizations. That's not an uncommon provision and
amendments to then give the authority to this body to set rules and explanation and scope to what the people have said in the amendment. My colleague Uh, Mrs. Wills identified that in her opinion. And she said neither the General Assembly nor the regulatory body may transgress the language of the Arkansas Constitution. The General Assembly and the regulatory entity invested with rulemaking authority will have some authority to delineate the
permissible scope of such narrower contractual arrangements. So she contemplated the fact that there would be legislation to spell out the details behind this amendment, and that actually happened. So this General Assembly then enacted a whole statutory scheme which spoke to Raffles, which is not in Amendment 84. None of that language is in Amendment 84, but it's authorized by Amendment 84. After that, DFNA then issued a
series of regulations pursuant to this General Assembly's power. So we've operated ever since 2007 with no incident, no lawsuit, no appeal. Over Raffles based on the language and the authority that this General Assembly took, that the people vested in them with Amendment 84. Not, not one single lawsuit. I was not asked to go defend the raffle after that point. Um I will say this part of the reason that there is specificity
in this bill is to keep it as narrow as possible. The University of Arkansas and all of its institutions has no intention of violating the Constitution. And when I had been asked in the past by by several of our schools. Is there any way that you can think of to generate additional funds to help us where we don't have to raise student fees. Where we don't have to ask for more money in the appropriations. And year after year, that's been
a very difficult challenge to come up with, especially since every bill I ever reviewed, I did not feel comfortable with the language up against Amendment 84. This one I do. This one was reviewed by the Attorney General's office. It was reviewed by A number of institutional lawyers in across the state. Many of whom I have an enormous amount of respect for.
And I will, I will say this with regard to the difference between looking at a foundation and the relationship being twice removed to a student athlete and the, the position of the university. So if you, if you think about right now, a university may have hundreds of sponsors. In fact, they may have thousands of donors, donors who are giving donations for tickets. That is a transfer of funds by donation to a university.
Under the logic that a student athlete who receives any dollars. From that becomes an affiliate. That means that our Our student athletes at any of our campuses would be affiliates of anybody who gives money for a ticket donation. They would be an affiliate of sponsors like Tyson and JB Hunt. So one of the rules of construction behind uh how the Arkansas Supreme Court is going to apply.
logic and reasoning to what something means, they're never going to construe it to an absurd result. In this case, an absurd result would be what that just because I gave money to a university. They become my affiliate. And, and I'm a little embarrassed to say, but I would likely venture to guess more than 80% of the student athletes at the University of Arkansas don't know anybody at the Razorback Foundation and may not even know it exists.
It, it's, that's the reality of being a student when you go through this. So, It in consulting with the Attorney General's office and other attorneys at higher ed institutions and uh with the sponsors, we felt comfortable that this language finally threaded the needle that would allow us to help. All of my schools that I represent. Um Senator Murdoch and I spoke about this a little bit earlier.
How then exactly if you do not have a supporting foundation, could you utilize raffle funds that were generated by a university. Well, one of the things that that would be able to occur, you could take those raffle funds and use them for any of the number of purposes that Mr. Hawk mentioned. But what that essentially does is it then frees up the opportunity to use other general funds to now support NIL. Which is why we had our athletic directors at that first hearing.
So eager to come down here and ask the General Assembly to
Senator Stephanie Flowers
Unverified
1:21:46
support a raffle bill. Um I could be wrong with that. What, what would, what would be wrong with that? To have, to have the university. Have freed up funds to pay
Speaker 252
1:21:57
for NIL. Yeah, absolutely nothing, and that's what this bill does.
Senator Stephanie Flowers
Unverified
1:22:00
Well, no, it wouldn't be engaging in a raffle for that purpose. Well, it actually doesn't even say in the bill
Matthew Mccoy
Unverified
1:22:09
that it's for a particular purpose, it's authorizing the expenditure of funds from the raffle. And it lists that a number of those and I would point out that the current law actually lists, does the exact same thing with specificity.
Senator Stephanie Flowers
Unverified
1:22:23
I'm looking at page 3 down at the bottom, starting
at D Uh, it's something about conducting raffles, uh. starting at line 12 on page 3. And, and then, uh,
It goes into this list of things that the qualifying organization may utilize those receipts from the raffle for. And Among those
are that NIL that part number 5. So And you say, If The foundation.
conducts the raffle, which I still see, I see a thread between the foundation and the university. I mean, I don't, how can you not? the purpose, I mean, certainly it has a Uh, purpose, uh, stated in
its articles of incorporation and it's for the benefit of the University of Arkansas, does it not? it actually, yes,
Speaker 278
1:23:35
it does. Absolutely it does. So how would you not
Senator Stephanie Flowers
Unverified
1:23:43
Associate any student with the athlete or not. As being an affiliate
Speaker 252
1:23:49
because Tyson and Walmart also donate money and they're not affiliates of those entities, but
Senator Stephanie Flowers
Unverified
1:23:54
we're not talking about Tyson or whatever whatever the company you just said, Walmart, did you say? Is that what
you said? Yes. So it 80 Amendment 84 says no receipt shall be used to compensate. No receipts. So the
receipts that the university has taken in from Tyson and Walmart. Shall be used. None of them shall be used to compensate in any manner, any person who works for or is any way in any way affiliated with the authorized bingo and Raffles organization. Yes. and you say you're not a lawyer either. I am a lawyer and I have been trained to think analytically and
lawyers do different differ and have you, are
you saying that no lawyer you've talked to has a different view of this in terms of.
Uh, compliance with Amendment 84. Well, what I
Matthew Mccoy
Unverified
1:24:57
was saying is the lawyers that I did talk to felt that that language did comply with Amendment
Senator Stephanie Flowers
Unverified
1:25:03
84. Well, how about language if if that language about the NIL, the, the was stricken. And amended to read.
Speaker 279
1:25:17
The university used the funds for general purpose. Then what would
Matthew Mccoy
Unverified
1:25:26
that do? It would be redundant because it says general support of the institution of higher education is already in there, so it's, so just strike it then. But there's, there's no reason to strike it if The institutions themselves are the ones who will make the decisions as to how they want to expend those, and I, and I will, I will say on behalf of the institution, if at any point a judge determines that that
violates the Constitution. The University of Arkansas system institutions will not engage in it in that manner, but suppose they've already acted pursuant
Senator Stephanie Flowers
Unverified
1:25:57
to it if it becomes law and actually paid out some money to athletes. With the athletes have to pay the money back? What, what, what do you
envision would happen. Well, here's the challenge with with
Speaker 278
1:26:13
the way that thread runs is, so there's, there's not an
Matthew Mccoy
Unverified
1:26:19
electronic dollar that gets tagged as a raffle dollar from the second it's taken in by a razorback foundation. There's a general transfer that occurs by most of our foundations that support a university. So let's say they transfer $10,000. Let's say $2000 of that was dedicated to the raffle. On that concern, than any one of those institutions could apply that $2000 too, anything else they wanted to maintenance,
scholarship, the other uh facilities. And then it would free up $2000 that was already allocated under general funds. So at the end of the day, whether it comes from raffle funds, it's freeing up dollars that might have otherwise been spent on, uh, facilities or
Speaker 277
1:27:09
equipment for those sports or travel. Yes, but what I'm flowers,
Senator Stephanie Flowers
Unverified
1:27:17
take me off the list, uh, because, uh, interrupting my line of
question. It makes it difficult for me,
Speaker 141
1:27:25
um I apologize, Senator Flowers, but you're not the only senator in the room. Thank you, ma'am. Senator Boyd.
Senator Justin Boyd
Unverified
1:27:36
Miss Benton, can you try to answer one more question. Can you tell me how the 2000 AG opinion differs when
Speaker 194
1:27:45
looking at this bill. Yes, Senator, and the, the 2007 AG opinion has to be read in the
context of the time in which it was written and issued, and in 2007, I think as Mr. McCoy mentioned earlier was when the
Speaker 197
1:28:04
charitable bingo and raffles enabling act was enacted and became effective. It became effective on actually July 30th of 2007. So the
Speaker 197
1:28:21
to conduct any raffle in 2007,
never contemplated once doing it electronically because in the charitable bingo and Raffles Enabling Act. It had a specific preclusion and said that a raffle may not be played through a machine or electronic device. So Raffles in 2007 were what you think of when you go to like, say a high school football game or a Ducks Unlimited banquet, and you're tearing off a ticket when you purchase raffles and
and so it was, it was a paper or or some other kind of manual way to conduct these raffles. Um, so when you think about what it would mean to be affiliated with an authorized raffle organization when in 2007, it would mean that You would need to be a volunteer of the Ducks Unlimited organization in my hypothetical, and that would that would be what it means to be affiliated with. So the AG opinion
Talking, when talking about what it means to be affiliated with these organizations. could not have foreseen the use of electronic devices and what licensing software licensing technology, what that might look like and how far the term affiliated with may extend in the scenario that we're talking about in terms of like tickets actually being handed out. So I think that's why When discussing what the affiliated with language would look like under this proposed legislation.
When looking at what the reasonable application of that of that phrase would mean that it doesn't affiliated with doesn't reach out until the end of time. There has to be a demarcation there in practicality, and I think that demarcation would be once if it's the 501c3 foundation that is conducting this raffle. That When it's not being conducted by that organization that affiliated with Language would then stop. I think that it would be a reasonable reading here.
Senator Missy Irvin
Unverified
1:30:32
Thank you, sir. Senator McKee. Senator Ervin. Yeah, I, and again, I guess I go back to
that though, that the way that I read that Amendment 84 and that provision, which Senator Flowers is asking a question about is a real concern. I mean, there's concerns throughout '84 and the way it's written, but to the, to the very specific point when it says, um, or is in any way affiliated.
So with the authorized bingo Raffles organization. I don't know how that's going to be interpreted by a judge. Because that is incredibly vague, like incredibly broad. And so, I And I guess again like it is by choice, but to me, Amendment 84 was written at a time where exactly what you just articulated is why I brought this into discussion. Right? And so is there the Is there
was there, I guess, is the question. Was there any consideration to say this could become problematic, and I mean, I realize it's a higher, uh, threshold for a vote to obtain. I get that. Nobody wants to do that. Um, but, To me, this language is a really, really problematic. Cinder Flowers has a really good point here. And so, I mean, I think the university needs to respond to that too, but um,
I, I, I think you've got areas of problems here,
um. And I think her, I think her points need to be, you
Speaker 194
1:32:18
know, answered. I think you were maybe hinting at the Edgemont case and maybe setting this up as a potential challenge there. We did not discuss that, and I think
Speaker 197
1:32:28
that In a world where maybe the AG's office would would look at potential or this legislative body would look at a way to tee
that up, to try to get the court to reconsider the Edgemon case. I think that strategically this would probably not be the best avenue by which to challenge that. Follow
Senator Missy Irvin
Unverified
1:32:48
up. I am not insinuating that somebody's writing a bill to tee up a court case. That's not my question. My question was, if you're trying to achieve what you're saying you're trying to achieve. For the University of Arkansas, and you see that this language is problematic. That's a very different scenario than what you
just outlined, respectfully. I am not suggesting that anybody is trying to tee up a court case here. I'm suggesting you're trying to solve the problem. I'm suggesting in solving the problem, I would have looked at every single options that I had on the table, and if that option of amending the language in '84 to resolve this conflict. was ever considered, if not why, and Uh If not, why? So, so my question's not about that. My
question is to the people that drafted the bill, University of Arkansas, uh, being majorly part of this, you know, did you ever consider amending the language in '84 to resolve this conflict of this incredibly broad language that's found under 3B2. I mean, there's other areas that I think you could go back and redefine, you know, your, your number one definition, um, because, because to your point, this was written at a time where nobody would have ever
understood bingo and raffle in the way that it is being conducted today. And especially at this level, and I don't know if the other states have language like this in their state constitutions or not, that are doing it, but I think it's just a really good topic of conversation because again, you know, I'm not, I appreciate where some people are very strict in their read of legislation to be constitutional, like, not violate the Constitution. However, there are members of this General Assembly that are
choosing to go no, we do need to take this step on this this issue and So it, you know, I, I have to understand that and for me, I tend to lean on the side of letting the legislature do what the legislature needs to do. Under what we can do according to the provisions on the powers that it gives the legislature. Thank you,
Speaker 161
1:35:06
Senator Irvin. Is there a question in that somewhere be thank you. Thank you, Senator Irvin. Um, I,
Matthew Mccoy
Unverified
1:35:14
I don't disagree with you. There are a number of amendments that I wish I could amend to make more clear. I wouldn't have had a job and I wouldn't have been in the attorney General's office if that were the case. So I, I appreciate the question. There was There was a lot of thought and I, I know that a lot of the public attention to this has only been within the last year, but there have been more than 6 years of looking at our particular uh raffle amendment.
Um, and, and going through options and most of those would, would come to me. I don't and then we, we give our input on what we think would be practical. To be able to do. The current statute right now is, it's not practical for, uh, generating funds to be able to support higher ed institutions at that level. There are caps. It prohibits electronics that the smart, the smartest thing about that particular Amendment 84, and you said you asked the
question, were there other states that have similar amendments, and they do, and they are equally as restrictive. But the smartest thing about what we have in ours is that it gives the general, the general assembly, the ability to lay out that scope, and this general assembly has given the Department of Finance and Administration, the flexibility to lay out those regulations. So one of the things we could not have anticipated in 2007 was all of the surge of technology that
we have now, and, and the way that this industry has changed. So One of the things that I, I think, uh, and, and I was glad to see in the amendment that they added was to allow the Department of Finance and Administration to promulgate regulations, and one of the things that they can do to ensure that no higher ed institution is violating the law is they can speak to. What does it mean to be an affiliate? What does it mean to conduct and have the authority through Amendment 84.
To define the permissible scope of those types
Speaker 306
1:37:24
of terms. Senator Irvin, do you want some clarity in that.
Senator Missy Irvin
Unverified
1:37:29
But then we're passing off our authority is, I mean, we're giving them broad scope under rules and regulations to now define language in the Arkansas State Constitution. So if you're OK with letting the executive branch do that, why aren't you let OK with letting the legislative branch define it through legislation. I think
the question was, did you ever consider amending the language in Amendment 84 to achieve what you're trying to do. Did you ever look at that? So yes
or no, it's a yes or no.
Speaker 161
1:38:07
Like, no, I did not personally. Is there any other questions? Seeing none,
Speaker 135
1:38:12
we have one to testify against this bill. are for this bill. I apologize.
Speaker 161
1:38:22
If you would just come forward and And introduce yourself and you're welcome to testify. Mr. Chairman, my name
Carlton Saffa
Unverified
1:38:30
is Carlton Saffa. I'm here on behalf of Saracen Casino Resort. It's an appropriate place to sit. I like the cozy way you run your committee, sir. It's A lot easier than that. So, uh, I'm
Speaker 313
1:38:44
gonna try to be brief. I've got a couple of stories and a couple of very important, very technical things to discuss. I'm
going to talk about 3 things today. First, why on earth am I here? 2, we're going to talk a little bit about this NIL thing, and 3, I want to talk about rules and rulemaking authority. So first, why on earth am I here? About a year ago, one of your colleagues contacted me and said, I think there's a place for your organization to play
Speaker 314
1:39:15
a role in NIL fundraising. And I remember this vividly. Senator McKee, I was probably
Speaker 313
1:39:23
somewhere near your district. I was driving between Pine Bluff and Hot Springs to our family's place on the lake. I think it was around Diamond Head when I got that call. And I went straight to the lake, open up my computer, and I remember it because my wife made fun of me. She said, we're going skiing with the kids. I said, No, I've got to work. What I did was I read through the Arkansas Constitution. About groups that could possibly conduct a raffle. To help with NIL. The first thing I did was I
looked at the lottery because it made logical sense. But the lottery amendment is also very tight. It says you've got to use the money only for scholarships or for lottery operation, so check that off the list. Next in my decision tree was the Raffle Amendment. So I looked at '84 and in '84 I saw that affiliated language that we've talked so much about today. And it's as clear as can be enormously broad and the attorney general opinion in 7, sure it's 07, but we discuss much older Attorney General
opinions all the time, and I think it's notable for this committee to consider that there have been no subsequent attorney General opinions on the topic. But the Attorney General's opinion speaks not only to the terms affiliated and compensated, but also with
Speaker 314
1:40:42
modifying language. Affiliated in any way compensated in any manner, so you have these
Speaker 313
1:40:47
you can't and then these phrases that even broaden the you can't. I would describe it as being a shotgun instead of a sniper round. This
is a very broad spread with the language. So in my decision making that afternoon on Lake Hamilton, I said, no, 84 won't work. So then we looked at our language and by our language, I mean the casino language Amendment 100 and I believe there was
Speaker 314
1:41:13
likely a way that we could make it work. Casinos do drawings of all sorts all the time, not necessarily raffles, the cars and all three casinos in Arkansas
Speaker 318
1:41:22
do them. They're a mainstay of every casino of any significance in
Speaker 314
1:41:28
the country. Drawing raffle, that's not the subject for today, but I believe that we had a way to
Speaker 313
1:41:34
offer this, and we have spent about a year diligently preparing a method to do that. What we have been told Is that oh that weighs unconstitutional. It won't work. Y'all have all probably been told that too. That way is unconstitutional. It won't work. So we have a bill filed.
The first bill was filed and we had a hearing in the House committee, and that bill did not advance out of committee, and there were a number of questions raised. That was an interesting meeting because we heard about the university's intention to use a Canadian company to likely do this. They talked about 10 or 15% off the top. I mean there were a number of things that were discussed in that forum. And one thing I want to make very clear for the record, there was misleading testimony from the University of Arkansas, the Fayetteville campus, in that
committee. If you've watched the meeting, you've seen it. I spoke at length about how a friend of mine was put in a very bad place, and I was speaking about Chris Robinson, the athletic director in Pine Bluff
Speaker 314
1:42:39
who signed that letter as a concept supportive of raffles, and I want to be clear that Saracen is also supportive of Raffles, but upon direct question by two representatives, the
Speaker 313
1:42:48
athletic. indicated the letter was only specific to that bill. I'm only mentioning this because I want you all to
Speaker 319
1:42:54
know there's been a lot of weird stuff in the air. I
Speaker 141
1:42:59
would ask that you stay with this bill, that's not the history. Sure, that's fair. But to
Speaker 314
1:43:05
bring you to date, how did we get here today as a result of that bill failing to pass House rules, and
Speaker 313
1:43:12
I'm grateful for the leadership of Representative Hawk and Representative Shepherd. We were able to get in a room, and the agreement was that we would stick to Amendment 84. We would write a bill that was within the extremely tight parameters of 84, and I like what Matthew Shepherd repeatedly said, which is we're really constrained. It's a tight
corridor. There's not much that we can do. And so in that spirit,
Speaker 314
1:43:34
that's why I'm here today to testify for the bill. Previously we spoke against the bill, but I want to give a couple of cautions. That's
Speaker 313
1:43:44
number 2. Why, why is, why am I cautioning? I'm, I'm for the bill, but there are some things that I would encourage you all
Speaker 314
1:43:51
to give serious consideration to. The first is this business of NIL, which I
Speaker 313
1:43:57
think is abundantly clear that it violates the plain language
of Amendment 84. So if we set out to Do something under 84 and then we've got language in there that clearly is violative of '84. Why are we doing this? There's an easy fix. And that is simple. If the universities are able to use this for general fundraising purposes that frees up funds for NIL regardless. And it makes this a clean bill, one that everyone can agree is within the parameters of 84, and it accomplishes the same thing. So if you have a pot of money
that you can supplement with funds from a raffle that frees up funds that could then be used for NIL otherwise you wouldn't necessarily be directing raffle money to the NIL. I want to be clear what I heard today. I still do not believe is a sufficient explanation to how a player wearing a jersey for a school. He has a contract to be paid by is not affiliation and compensation. I mean that is plain language affiliation and compensation, but what we can do is take out the permissible use of raffle
funds as NIL. It frees up money and the money that they'd otherwise have would work. The other thing I want to say is this is the closest
Speaker 314
1:45:12
we've heard to any kind of an explanation about how this is constitutional, and so I don't mean to be personal, Mr. Chairman, but in my mind we were told, oh, your
Speaker 313
1:45:21
way's not constitutional. Why? Because our way is constitutional. Why? I mean, in another world that almost sounds like money laundering. We're going to run it through this one and pass it through
Speaker 314
1:45:29
that one, and it's going to go through this one and I'm not accusing anybody of a crime, but I think you understand what
I mean. If you're going to thread this needle in such
Speaker 161
1:45:41
a way, Mr. Safa, I have no idea if you're speaking for or
Speaker 319
1:45:46
against this bill. Are you speaking for this bill? So ultimately I am for the bill,
Speaker 161
1:45:51
but I have cautions about the NIL language. You're not here to litigate the policy of the bill we are please state your your direct to your bill. Thank you. The final comment that
Speaker 313
1:46:03
I will make is regarding the rulemaking. And I am grateful that we
included rulemaking permissions within this bill, but this bill contains an emergency clause, and it has may language, not shall, and I would encourage you all to consider passing this bill, but paying attention to the May versus the shall, and there may be an opportunity to make a change there, Mr. Chairman, I will close with this. I have a handout that does not need to be read but speaks for itself, and it is indicative of the rules. It is the paper rule. that the state has for churches
conducting a bingo. It is the online rules that exist in the state of Kentucky. And it is the rules that will
Speaker 314
1:46:45
apply online to a raffle with your permission, I will pass it out and then I am finished. If you
Speaker 161
1:46:50
would bring it to staff and I'll review it and then I'll decide.
Speaker 325
1:47:04
So We're not going to be able to review. This.
Speaker 161
1:47:12
By the time, if, if we vote today, I appreciate that effort. I'll give it, I'll give it to the members after we're done, so. So what would preclude Saracen from raising funds. And donated to the foundation and the foundation can do whatever it wants to with it without, without this legislation. So to be clear, we've long
Speaker 314
1:47:36
been a supporter of the University of Arkansas, even predating any form of online
gambling. This is really more about the principle for us. I followed it through this far. We had a way that made sense and we were willing to proceed. We were told that way was not constitutional without a real explanation. We agreed to support an amendment 84 bill as long as we stayed within the tight parameters of Amendment 84, and my, my concern, I think a bill needs
Speaker 313
1:48:06
to come out and a bill needs to pass, but one for general fundraising purposes for the university because we
jeopardize what we're doing with the inclusion of NIL, and so that may give some clarity as to how I'm actually for this. I am just very nervous about an emergency clause with a may, not a shall, and I am Very nervous about the inclusion
Speaker 161
1:48:30
of the NIL language. Thank you, but you didn't answer my question. What would preclude you as as that your institution from raising money and giving it to the foundation of the University of Arkansas, Arkansas
State, tech, every other university in the state that has a foundation of what would keep you from doing that.
Speaker 314
1:48:52
Absolutely nothing. In fact, last Thursday night, we hosted an event with another gentleman in Pine Bluff and gave $50,000 to UAPB's baseball program. I mean we do that all the time. I'm concerned about the Nial language in here, Senator. Thank
Speaker 327
1:49:07
you, Senator Murdoch. Thank you, Mr. Chair. Um,
Senator Reginald Murdock
Unverified
1:49:11
so what, with all the information that I'm hearing, listening to
these lawyers, um, um, sparring debate back and forth. What I surmises, I'm just an engineer. What I surmise from all of this is that we have a legal question possibly at some point. Because of the back and forth that I hear where there is not consensus on interpretation of some things at the end of the day, this body passes this out, then we're subject to a judge at some point, possibly if a claim is filed, making another decision.
So from what I'm hearing inside of this. Debate We're not going to get as a committee, a legislative committee, we're not going to get clarity from the lawyers to give us a clear path. To make a decision. Well, we're gonna have to do, choose to do individually is make a decision. Based upon intent, what we're hearing. And then be subject to the next
step that will come from if something is filed. I think this can last days. With the different interpretations about what I what I'm hearing. I'm prepared to move forward personally on whatever decision I'm going to make because I think I understand where I'm at and where we are today with this argument. So I don't have a question, but that was a point of clarity. Do you agree that this is just going to be a back and forth among lawyers and legal minds to debate. These things that we that we're
Speaker 313
1:50:53
hearing. I would agree in part, but Senator, I would say there's a very simple way that I think we can remove the one contention, and that is to be very clear and operate very clearly within the parameters of amendment 84. So this will still free up funds for NIL because you'll have supplementing funds coming in for general athletic purposes. So if the NIL language comes out, it doesn't really impact NIL. The universities can still pay it. You just comport with Amendment 84, which is what we set out to do, which was write a bill that comported with 84. So
Senator Reginald Murdock
Unverified
1:51:27
as we continue the debate, let me ask a question to the bill sponsors you gentlemen, um. What
he's contending on that general purpose can someone address that for me? Well, I mean,
Senator Jonathan Dismang
Unverified
1:51:39
I think it's actually a question for the Attorney General's office. Are they going to be willing to litigate if there is litigation, let's say Syrian wants to bring litigation because they don't feel like it complies with Amendment 84, do they think that the language is written in such a way that they have a case to make. for the state. Well, before
Senator Reginald Murdock
Unverified
1:51:58
that, Senator, my question is on his contention that that we can clear it up by what I, I
just want to hear the response about what he's saying clears it all up. It's general purpose. I
Speaker 332
1:52:08
believe that the school, the foundation, and the players are separate entities, and
Senator Jonathan Dismang
Unverified
1:52:12
we can talk about affiliation all day long, and that's the whole debate. I mean, what I would argue is it's all contemplated in the bill. He was in the meeting that we had in which it was contemplated and we agreed that this was the direction to move forward. We've decided at this point that it's no longer the direction to
move forward when we say we, I would say Syrian has, you know, determined that that's not a direction to move forward. I am comfortable with the bill. I think the Attorney General's office from all the conversations that I've had are comfortable with the bill, so I don't think there is some legal question. I mean, you could make that argument on anything and everything we do all day long up here that at some point someone could bring litigation, and there's some, there would be truth to that, but we plow forward, uh, regardless of. That potential litigation and try to write the bills the best we can. I think that's what we
have in front of you to consider today.
Senator Reginald Murdock
Unverified
1:53:02
Yeah, my last day here. I appreciate your indulgence. I think both sides bring up a great points of contention for those of us that's hearing this, uh, I'm ready to move forward as well, but I do move forward with the understanding that there may be some more stuff to happen outside of this body, but I am ready. Thank you, Senator, Senator Ervin.
Speaker 143
1:53:21
And then Senator Johnson, I believe, yeah, just a quick question. To Mr. uh,
Senator Missy Irvin
Unverified
1:53:31
So, are you, are you saying that the shall, the mate and the show is on page 5 under promulgation of rules, lines 7 and 8. I'm just trying to seek clarification on that versus the emergency, the emergency clause. Yes, sir complicates that. Is that where that's found? So
my caution, and I, and I keep using the word
Speaker 313
1:53:48
caution and I apologize if that's the wrong word to use in a for it, but I think it is possible to be for something and still have some questions or concerns. My caution is that we have a bill that has an emergency. clause, which means it's effective almost immediately
upon passage. And your permissive language. About rulemaking in which we could ostensibly clear up any questions or concerns is a may, not a shall. So you have a bill that will come out on an emergent basis with no accompanying rules if the emergency clause passes, but you do not have An obligation for rules to exist and while I handed a big stick, thick stack of stuff to the chairman, and it's probably not fair. I will tell you what was in it. So the first,
Senator Missy Irvin
Unverified
1:54:33
yes ma'am and then on page 4 lines 1011, and 12. Those are the lines that you say are that you that are in your opinion, cause The legal Issue with Amendment 84 and how the language is, uh, It said, you said violates the plain language of 84, and I just want to be specific that that's page 4 lines 1011, 12. I don't have the bill in front of me, but if that is the
I just want to know like, On the bill where the exact concern is I think that's
Speaker 313
1:55:13
it. I think if you take that out, then you, you clear up any kind of question that could exist as to whether or not the legality of this is there. Look, we are
Senator Missy Irvin
Unverified
1:55:22
pro it's because of the in any way, any manner. You got qualifiers
that you were saying that so I just wanted to be, so page 5 line 7. And page 4, lines 1011, 12. I
Speaker 135
1:55:36
just needed to know specifics. Are, are you finished? Senator Ervin finished.
Senator Mark Johnson
Unverified
1:55:53
All right. Senator Johnson, Mr. Chairman, um, I think Senator Dismay
touched on the appropriate fact about this uh the fact that you have Jonathan Dismay and Matthew Shepherd sitting there as technicians and
this bill makes me even more comfortable with the fact that it's not inherently unconstitutional or in violation of Amendment 84. We ask, we presume that BLR ran it through that filter before this thing was ever brought to the sponsors to To introduce and we've heard from the AG and they have reviewed it now. Anyone could sue. file a lawsuit on this constitutional grounds on this bill. They wanted to, but the most important point I want to
make is that actions of the General Assembly are presumed to be constitutional until deemed otherwise by the Supreme Court. So if for that reason, if I would, I would like to move for immediate consideration of House Bill 1634. Motion for immediate
Speaker 135
1:56:56
consideration is recognized what's the will of
Speaker 161
1:56:59
the committee motion by Senator Johnson, seconded by Senator Boyd, all in favor say aye. All opposed like sign. Thank you, senators and
representatives, you've passed your bill. Thank you
Speaker 193
1:57:18
committee OK. OK. Apologize. It's been, it's been a
Senator Stephanie Flowers
Unverified
1:57:27
the will of the committee on the bill. Immediate consideration. they did. I'm Senator Jonathan Dismang,
Speaker 161
1:57:41
Senate District 18. We recognize Senator Johnson for a motion, motion by Senator Johnson Du pass seconded by Senator Boyd, all in favor say aye. All opposed like sign. Thank you. You're you are. Roll call. Senator Mark
Speaker 344
1:58:05
Johnson, Senator Mark Johnson, I, Senator Reginald Murdoch. Senator
Speaker 345
1:58:13
Reginald Murdoch, I, Senator Matt McKee. Senator Matt McKee, I, Senator Clint Penzo. Senator Clint Pino, yes, Senator Stephanie Flowers. Senator Stephanie Flowers no. Senator Thank you, Senators Representatives, is this passed?
Senator Missy Irvin
Unverified
1:58:43
Yes, go ahead. We didn't have discussion on that, and I, I would have liked to have participated in a discussion on that. Do, do you
Speaker 135
1:58:55
mind if I state that we've had plenty of discussion. I I appreciate it. Thank you. We have Josh, this better be short.
Speaker 161
1:59:10
All right, which, which number is it
Speaker 325
1:59:22
Senate Bill 323. Just introduce yourselves and you're recognized. Thank you, Mr.
Senator Joshua Bryant
Unverified
1:59:36
Cherry Joshua Bryanten District 32. Jason Bramlet, and
Speaker 351
1:59:39
I'm an attorney at Friday, Eldridge and Clark. And Mr.
Senator Joshua Bryant
Unverified
1:59:44
G, I'll just be real brief before I turn over to Mr. Bramlets. This is our, our horizontal property regime laws date back to the 1960s. Lots of
activities has occurred between now and then, so this is um The need to update and refresh that with new terms and new methodologies, and with that I'll turn it over to Mr. Bramlet. Thank you, Senator Bryant. Thank
Speaker 352
2:00:05
you, Mr. Chair and members of the committee. Yeah, sure, for
Speaker 355
2:00:08
sure. You know, when we referred to the horizontal property regime Act. I think there's a lot of confusion as to what those words actually mean, and I think it's better understood as a condominium act. Why the words horizontal property regime ever made their way into the books.
I'm not certain, but I think most people refer to them and know them as condominiums. The current act that we have was passed in 1961, and it's commonly referred to as a first generation act. So whenever um a developers and property owners wanted to have the ability to own, convey, sell, mortgage separate apartment units they came up with a plan to enact that through a series of statutes enacted in a variety of states in the current form we have was
the first iteration of that. The concept of a horizontal property regime where a condominium in the current form of the statutes that we have works great generally for an apartment building. So if you think about one building that has maybe 20 apartments in it. It gives the ability to have separate ownership of those apartments, whereas in most apartment buildings you have the ability to have one owner, one lien, or one bank loan, and when it's bought or sold, the whole
thing has to be sold. This gives the ability to have ownership of property that is separate and apart from a single family house. As Life has developed as developments have developed as our state has become more robust in the development world. There is a need to expand the scope of what these statutes currently provide for, and the best way I can do that is to give you an example from Fayetteville, which is where I currently live in Fayetteville a couple of years
ago, the city of Fayetteville in a private developer wanted to develop a parking garage, and this was to take place of the Walton Arts Center parking lot. In order to do that and to make that financially viable, they needed to include different uses within that parking deck. So if you were to drive down Dixon Street now, you'd see a parking deck that has not only parking structures, 5 or 6 floors, but also has a police station on the first floor and has other commercial units on the first
floor. I drafted the master deed for that horizontal property regime and sometimes it's like fitting a square peg through a round hole in that we have different uses for that property being commercial parking structures, a police station and eventually individual economy condominiums on the top floor, and we had to fit that particular development within the current statutory scheme that we have, um, which was workable, but certainly not
the best way to do that and if I can give you a better example of that under our current statutory scheme, every unit has to be given a value, and that value establishes the amount of their voting rights within that regime along with their ownership of the common areas and as things have developed and for example on this development, it would have been perfect opportunity to have what we call a nesting regime. structure which allows for one
master regime and then smaller regimes within that. So one for the parking structure, one for the commercial units, one for the residential units The current bill that's in front of you today allows for that ability, so it allows for a developer to create a mixed use building that has commercial residential parking, whatever use they intend to have in there and divide that. up in the sub-regimes that allow each
Particular used to be governed somewhat independent of the whole. And so the purpose of this bill is to do that among one of the things, but also to better define what a unit is, so under the current statute that we have, a unit or an apartment is generally defined as anything on the inside of the four walls, and that creates a lot of ambiguity when it comes to determining who's responsible for what repairs within that unit is the unit owner
responsible for the sheetrock, or are they responsible for the things behind Sheetrock and this statute provides with much more specificity as to what is a unit and what is not a unit and therefore what is not a unit then becomes a responsibility of the entire regime itself. One thing I think is important to note that when we were working on and drafting this bill, we provided draft copies to various law firms within the state that have a practice
heavily that practice is heavy and horizontal property regimes we received their comments and those comments are currently reflected in the current state of the bill, and in addition, we have run this by the, the Arkansas Land Title Association, and they likewise have approved and given their support. for the bill as well. I'm happy to
Speaker 357
2:05:18
answer any questions that the committee might have. Do you have any questions, Senator Flowers?
Senator Stephanie Flowers
Unverified
2:05:30
Thank you for your explanation and for bringing the bill, uh, I think Arkansas needs something, uh, that terrifies. Uh, properties that have common Spaces, uh, particularly common walls, and I'm very concerned about that. Actually, I On a
building that had a common wall with another building. And the city ordered. Uh, do the neglect in the maintenance of that other
building that that property be torn down, leaving exposed one of my exterior walls. And I found
it very difficult to find anything in Arkansas law that addressed that. What would
this bill do? For a situation like that with a common
wall. And The liability who maintains that kind of
Speaker 355
2:06:32
thing. Yeah, that's a great question. So I think in order for this statute to work and even under its current status for it to work, those two properties would have to be subjected to what we call a horizontal property regime, and that's done by filing a master deed in the land records and creates that regime and then establishes their responsibilities for each side of that wall, for example. and who would have responsibility for their maintenance and repair of
Speaker 357
2:06:58
the things that are not deemed to be co-owned.
Senator Stephanie Flowers
Unverified
2:07:05
So this bill, and I have to admit I haven't really Reviewed it thoroughly, not even close, but that term master deed, is that presently in
Speaker 355
2:07:18
our law? Yes, Senator, it actually is, and one thing that we certainly try to do with this amendment is to maintain the current structure of the horizontal Property Act along with the current nomenclature and definitions that are currently there. There were opportunities to perhaps adopt
sections of the uniform Act. However, that would change a lot of the definitions that are used in a lot of the structure and so we operated within the confines of what currently exists and so the concept of a master deed has been in that
Senator Stephanie Flowers
Unverified
2:07:54
act since 1961. But you're in this area of the law. That is correct. So I had trouble finding many cases that dealt with these master
deeds that had common walls. is that something that prompted
Speaker 353
2:08:16
Uh, not necessarily, although I understand the circumstance that you're referring to, and I've
Speaker 355
2:08:20
dealt with that in my practice separate apart from the instances that we would find in a horizontal property regime. However, should that circumstance arise in a horizontal property regime and it certainly could if those properties are subject to one,
then the existing statute, but this one as well would define who is responsible for what parts of that wall in the maintenance of that wall and it would also explain whether like a master regime or associations responsible
Speaker 361
2:08:50
for that maintenance. Last question, Mr. James. So With this bill, How If,
Senator Stephanie Flowers
Unverified
2:09:08
Multi-complex. Uh, and Could they do so? Without a master deed. And Lisa
sell those individual units without a master deed. No, no, if you have,
Speaker 353
2:09:28
for example, one building with multiple units in that building, you do not have
Speaker 355
2:09:33
the current ability to sell any individual unit without
Senator Stephanie Flowers
Unverified
2:09:38
subjecting it to a master deed. So then If there are existing dwellings that are multiple. Units This would allow or does the law now allow for a master deed to be created. Yes, yes, and the current statute
Speaker 355
2:09:59
does, and this one does as well. It preserves that right and so in that circumstance, if there's one
owner of that building, that owner could subject that property to a master deed and thus have the ability to sell off the individual units if there are More than one owner, you would need all of the owners to
Speaker 361
2:10:19
consent to that master deed and Uh I
Senator Stephanie Flowers
Unverified
2:10:32
think I heard you discuss and talk about. The reason they are in Fayetteville you gave the
example of the multi-purpose, multi-unit structure. And But what, what
was the What was the problem? The value not being able to be determined or who, who is responsible for what? Are common areas
or something. What prompted this. I know you said it hadn't been changed since the 60s.
So what is our immediate need in Arkansas to have
Speaker 355
2:11:16
this. Yeah, I think it's a general benefit for any developer, I have been retained by a developer in Benton. vi ll e that is working to develop a mixed-use project, and this particular set of amendments would be applicable to that project, but it would also be um a net benefit for any developer that's looking to build a condominium regime throughout the state. And is that because our present
Senator Stephanie Flowers
Unverified
2:11:42
law does not Allow them to effectively do what they want to do. That's correct,
Speaker 359
2:11:49
yeah, as I mentioned to you, the, the one in Fayetteville that I did was um The
Speaker 355
2:11:55
best way I can describe it is fitting a square peg in a round hole. We were able to make it fit, but it's not the easiest or best functioning regime that's out there. Is there any other questions?
Speaker 160
2:12:16
Seeing none, uh, we have no one to speak for
Senator Joshua Bryant
Unverified
2:12:25
know, you'd be able to do this. I will the situation, I will close for the bill and
Speaker 161
2:12:32
ask for a motion to do best motion by Senator McKee, seconded by Senator Flowers. Any discussion all in favor. Say ah. I'll opposed like sign. Thank you, Senator, you passed your bill. What's
Speaker 160
2:12:51
What's, what's the, uh, we, what's the will of
Speaker 161
2:12:56
the committee to proceed. Or come back after we adjourn. Uh, I think Senator Penzo has some bills that have been held up in with the revenue impact and those bills are back. Senator Irvin would like to run one when when when the committee
Speaker 135
2:13:21
like to adjourn and address this later this afternoon after we get
Speaker 161
2:13:35
off the floor. Is there any anyone that I'm sorry, I'm just asking the committee, can we adjourn and come back after we get off the floor to get your bill and Senator Penzo, those are not on the regular agenda, those we, I think we'd have to suspend the rules, but
he's been, he's been patiently waiting on some of those to get with those those, those are not uh Alright, I'm good with, I'm good with going on, uh, Senator Irvin, if you would, would come to the floor and let us know what bill it is. Thank you, Senator Missy Urban District 24. This is House Bill
Senator Missy Irvin
Unverified
2:14:23
1298 for, uh, Representative Lee Johnson. It's Simple Bill, what this bill does is that it just allows that if you're out of network, Uh, then, The, um, if you're out of network, it just clarifies that out of network, that out of network payments can go directly to the provider instead of a patient instead of to the patient and then have the provider try to collect it.
I'm sorry, 1298. So, this makes it consistent whether you're in network or out of network, if there's a payment, then the payment can go directly to the provider versus to the patient and then the patient having to remit that. the provider. Well, out of network, it's, it can be done. It's done. To, it can be, unless you direct it, but it's the healthcare insurer can just pay the. Pay the provider.
Speaker 237
2:15:27
Just like it is in anything else that we do. I think Mr. Chairman, I think
Speaker 380
2:15:38
I got my question answered, but on is may provide That those go to the provider, not shall just creating an option.
Speaker 381
2:15:45
Senator Murdoch, whose decision is that? The patient, yes. Thank you.
Speaker 254
2:15:53
Is there any other questions? Seeing none, uh, Senator Flowers.
Senator Missy Irvin
Unverified
2:16:02
So Our insurance companies pretty much on board, yeah. It makes it very easy, a lot easier for them.
Yeah. I was just There's no opposition. OK. Thank you, Mr.
Speaker 161
2:16:25
Chair. Is there any other questions seeing none. Will the committee, Senator Murdoch,
seconded by Senator Irvin, any discussion? All in favor say aye. All opposed like sign thank you Senator Irvin. Senator Boyd has a bill that he says is noncontroversial. He's in the There 1587, is that I can present them all.
Speaker 135
2:17:13
as to come back this afternoon, I'd rather get
Senator Justin Boyd
Unverified
2:17:17
over whatever we can. All right, uh, state senator Justin Boyd, House Bill 1587. This bill is
all it does. Is it adds pharmacies to the list of
providers, uh, on the any willing provider law. So
typically contracts are with pharmacies, not pharmacists. There can be some cases where it's individual pharmacists, but generally it's with the pharmacy, and this just makes that clear. You, uh,
Speaker 385
2:17:47
You need to disclose anything, Senator. I'm fully
Speaker 387
2:17:50
disclosed. Any other questions? So see no you are closer your
Speaker 135
2:18:07
motion do pass motion by Senator Boyd, seconded by Senator McKee discussion all in favor. Say aye. All oppose like sign. Do you have any other simple ones. So with the
Senator Justin Boyd
Unverified
2:18:18
committee's permission and you decide if it's controversial. I've Senate Bill 366 act to strengthen the Arkansas Homes Act. We've heard that bill in essence, it was a previous bill number, but I listened to the committee or we listened to the committee and we took out the $12 million that was coming out of general
revenue. We got rid of that and we exchanged it for an opportunity for money to be donated, uh, or other sources of revenue could be used, so there's no mandate. to come out of general revenue. And then the other thing is, is Mr. Chair had a concern about what if you didn't have insurance and this makes it clear that if you don't have the insurance that you've
got to get signed up. With, with insurance in order to to qualify for that.
Speaker 161
2:19:09
So it's pretty much self-funded and if you're going to apply for
Senator Justin Boyd
Unverified
2:19:16
get insurance. Yes, and so what it puts two mandates on insurance companies, one that they have to offer a deductible if you've built the resilient home, gone through the program, and then, um,
Then the other one is you have to offer a rider so that if you on the on the property and casualty so that if you want a rider that says it's going to be built back to this standard. So those are the two things I've heard no controversy from anybody except for that, you know, one of those entities that,
you know, complains about the bills we have. All right, Senator
Speaker 141
2:20:01
Johnson, hang on a second, can do it. Senator, Senator McKee, was this
Senator Justin Boyd
Unverified
2:20:11
in call model legislation. This is where one of the things I've learned about the other inco is one place that's been highly discussed. Alabama has similar
legislation. Oklahoma has similar legislation. Also this, if you, if you remember we discussed this in the interim before this General Assembly. And so one of the issues is, is like mortgages, because what happens, property and casualty goes up and wait,
it's an inconvenience for some people, but if, if it keeps going up, it threatens the mortgage market. It's the
Senator Mark Johnson
Unverified
2:20:41
difference in being able to buy a house and not because of the cost of insuring it is what you're saying this should put some downward pressure on premiums, and I didn't know if Ian
Senator Justin Boyd
Unverified
2:20:53
Cole had actually adopted it as a I know it was discussed because I remember it's based on the National Association
of Insurance Commissioners more than in coil specifically, but it's it's based on model language. Thank
Speaker 48
2:21:05
you, Senator. Thank you, Mr. Chairman. Any other questions, Senator Murdoch and
Senator Reginald Murdock
Unverified
2:21:11
then Senator Flowers. I remember this, I guess. So the funding you're handling that a different way, but the requirements, contractor requirements, some of those things that the gentleman that was here with you that day
Senator Justin Boyd
Unverified
2:21:25
because there was someone here with you, we had an expert who who came in. There
Speaker 333
2:21:30
are no requirements on contractors. Well, there
Senator Justin Boyd
Unverified
2:21:33
are you taking those out? the only requirements for the contractors would be if they were going to be the fortified home, yes, but if you're just a
contractor and you don't care, there's no requirement. There's no new build, no new code on McKee or you or Bartester or anybody else, no, unless you choose to
Senator Reginald Murdock
Unverified
2:21:53
participate. That's my point. If you choose
to participate with this legislation, then you have to get those certifications right now. We don't have anybody in Arkansas that's so certified this so as as we Arkansas General Assembly,
then we don't have any contractors, so it is a contractors.
Senator Justin Boyd
Unverified
2:22:13
Right, but the, the contractors I've talked to are supportive. I've, I've not heard of one who is not supportive. I've reached out or talked to someone and they've they've been supportive. So what this does in essence, look, I thought we'd heard the bill. I, I really thought we had worked out all the controversy. Maybe we hadn't, maybe I mistook that. I thought I listened to the committee and Did what I was asked to do
Speaker 4
2:22:40
and so um well, I'm not going to stop it. I'm just saying there's
Senator Stephanie Flowers
Unverified
2:22:44
some things going on, Senator Flowers. And then Senator McKee, you, you mentioned something that had some time off with Senator Johnson there to go about, uh. The mortgage. What,
Senator Justin Boyd
Unverified
2:23:02
what were you saying about that? So, so this, this doesn't directly do anything with the mortgages. What has happened is as property and casualty rates, homeowners insurance has gone up, that threatens the mortgage market because if you have, if
you've borrowed near the top end of your mortgage and now all of a sudden your property and casualty goes up and you've filled in that gap, you might foreclose, get your mortgage foreclosed because you have to have property and casualty insurance. We're trying to stabilize
the proper we this is one thing Governor government can do to stabilize the property and casualty insurance market. So this until you get the funds, it's not gonna
get there, but this puts the framework in so that we can potentially find the the funds to do that.
Speaker 161
2:23:47
Seeing seeing no other questions, uh, do you wanna, you wanna
Senator Justin Boyd
Unverified
2:23:51
close your bill? I'm closed. I make a motion to
Speaker 161
2:23:55
do pass and really would appreciate a second motion by Senator Boyd, seconded by Senator McKee. Uh Any discussion all in favor say aye aye, all opposed like sign. Thank you, Senator. I, uh No Now I want to, I want, I want to do
those bills that are coming out of physical session or out of the the physical impact studies. Have you, I mean, are these pretty simple? Let's, let's do those, let's do those as first order on Thursday, and that way they'll be on the on the schedule. We won't. had to suspend the rules, OK, but we want to get your, those things that come out. I'm going to put those first on on the
agenda as soon as they come out because members have been waiting. We appreciate your indulgence and if those hadn't have came out, I told them they're going to be at the end of the table Thursday, OK. Thank you. Thank you, members. We are adjourned.
Agenda
REGULAR AGENDA
Call To Order
SB319 J. Boyd TO AMEND THE UNIFORM LIMITED LIABILITY COMPANY ACT; AND TO CLARIFY CHARGING ORDERS UNDER THE UNIFORM LIMITED LIABILITY COMPANY ACT.
SB323 J. Bryant TO AMEND THE HORIZONTAL PROPERTY ACT.
SB366 J. Boyd TO CREATE THE STRENGTHEN ARKANSAS HOMES ACT; AND TO CREATE THE STRENGTHEN ARKANSAS HOMES PROGRAM FUND.
HB1558 McGrew TO AMEND THE LAW CONCERNING THE ARKANSAS REAL ESTATE COMMISSION; TO CREATE A PROPERTY MANAGEMENT BROKER AND PROPERTY MANAGEMENT ASSOCIATE LICENSE; AND TO AMEND THE REAL ESTATE LICENSE LAW.
HB1298 L. Johnson TO MODIFY PAYMENT OF BENEFITS FOR CERTAIN HEALTHCARE PROVIDERS UNDER A HEALTH BENEFIT PLAN.
HB1587 L. Johnson CONCERNING THE ANY WILLING PROVIDER LAWS; AND TO AMEND THE PATIENT PROTECTION ACT OF 1995.
HB1595 Steimel TO ENACT THE STATE INSURANCE DEPARTMENT'S GENERAL OMNIBUS AMENDMENT OF ARKANSAS INSURANCE CODE.
HB1620 Gramlich TO AMEND THE LAW CONCERNING PHARMACY BENEFITS MANAGERS; AND TO REGULATE PROCESSING AND PAYMENT OF PHARMACY CLAIMS.
HB1634 Hawk TO ESTABLISH THE ARKANSAS SPORTS RAFFLE ACT; AND TO DECLARE AN EMERGENCY.
PENDING FISCAL IMPACT
SB83 J. Bryant TO MANDATE COVERAGE FOR BREAST RECONSTRUCTION SURGERIES; TO REQUIRE PRIOR AUTHORIZATION FOR BREAST RECONSTRUCTION SURGERIES; AND TO ESTABLISH A MINIMUM REIMBURSEMENT RATE FOR BREAST RECONSTRUCTION SURGERIES.
SB103 C. Penzo TO CREATE THE PHARMACY NONDISCRIMINATION ACT; TO REQUIRE PHARMACY BENEFITS MANAGERS TO ACCEPT ANY PHARMACY OR PHARMACIST WILLING TO ACCEPT RELEVANT AND REASONABLE TERMS OF PARTICIPATION; AND TO DECLARE AN EMERGENCY.
SB123 G Leding TO AMEND THE LAW CONCERNING COVERAGE FOR MAMMOGRAMS AND BREAST ULTRASOUNDS.
SB 140 J. Boyd TO MANDATE THE USE OF BIOSIMILAR MEDICINES UNDER HEALTH BENEFIT Plans: TO REQUIRE A HEALTHCARE PROVIDER TO PRESCRIBE BIOSIMILAR MEDICINS; AND TO IMPROVE ACCESS TO BIOSIMILAR MEDICINES
SB104 C. Penzo TO AMEND THE ARKANSAS PHARMACY BENEFITS MANAGER LICENSURE ACT; TO PROTECT PATIENTS' RIGHTS AND ACCESS TO MEDICATIONS; AND TO DECLARE AN EMERGENCY.
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — INSURANCE & COMMERCE - SENATE, Mar 11, 2025 | Agenda | 2 | Official source ↗ |
Speakers
Senator Justin Boyd
Unverified
Representative John Maddox
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Senator Mark Johnson
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Speaker 21
Speaker 23
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Senator Stephanie Flowers
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Speaker 43
Speaker 48
Speaker 87
Representative Richard McGrew
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Speaker 106
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Speaker 135
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Speaker 141
Senator Matt McKee
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Senator Missy Irvin
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Speaker 153
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Representative RJ Hawk
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Representative Matthew J. Shepherd
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Speaker 186
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Senator Reginald Murdock
Unverified
Speaker 245
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Matthew Mccoy
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Speaker 277
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Carlton Saffa
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Senator Jonathan Dismang
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Speaker 332
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Senator Joshua Bryant
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