Senate Convenes

Not. that the Senate will be called to order. Are there any requests for leave at this time, Senator Caldwell, you're recognized. Uh, Ashley for Senator Hill and Senator Sullivan. Thank you. Madam Secretary, please call the roll. Boy, Bright Caldwell, Clark, Kroll, Davis, Des, Dima Dotson, English Flippo, flowers, Gilmore, hammer, Hester, Hickey, Hill on leave, Irvin, Blake Johnson, Mark Johnson, King, letting, love, the key, Murdoch, Peyton, Penzo, Petty, rice, Scott, Stone, Stubberfield, Sullivan on leave, Tucker Wallace. Thank you, Madam Secretary. If everyone in the chamber and in the galleries would rise for a prayer and send her love will be introducing our pastor of the day and then remained standing for the pledge of allegiance, Senator Love, you're recognized. Thank you, Governor, and Pastor Featherstone, I'm, I'm asking for leave for my pastor, pastor Featherstone. You all, you are in for a treat now. If he was preaching I say you're in for a treat, but you know what, I, I'm gonna tell you this, um, pastor Featherstone is a God-fearing pastor, a man on fire for God and he only teaches the word he only teaches the word and I'm happy to say that I'm part of this flock, and so uh I present to you Pastor David Featherstone. Let us pray. Most gracious and Almighty God. We come bow before thy throne of grace and mercy. With hearts filled with thanksgiving. Lord, you've been so good to us and we're so grateful to be your children and your servants. We thank you for life, liberty and the pursuit of happiness. Thank you for this great state of Arkansas that you have blessed us to be residents of and we praise you for this state. We lift up all of the elected officials. We pray now, oh God, for wisdom and. Discernment and insight for this ninety-fifth General Assembly we're just grateful for you calling people into service. For the Bible declares that you ordained government. And we thank you for it. We ask now in the mighty name of Jesus that you would give insight. Approval and directions to what be done here and we just will look forward to your people being blessed from the decisions, the bills and laws that are passed here. God lead and direct by your spirit. We pray. Amen. blue flag of the United States of America and to the Republic. One nation and the invisible liberty and justice. Thank you pastor for those uplifting words. Good to have you with us today. Ladies and gentlemen in the galleries, welcome to your Arkansas State Senate. It is our expectation that each of you will exercise proper decorum and govern yourselves accordingly during today's proceedings. Without objection, the rules will be suspended and the Senate will dispense with the reading of the journal. The morning hour has now begun. I would like to ask Senator Caldwell to recognize to introduce our pages for the day, Senator Caldwell. Thank you, Madam President. Uh, members, I would like to recognize our Senate pages for the day. Uh, when I call your name, please, if you would come down to the front and be recognized. Jonny Sanders from Whitehall Middle School, a constituent of Senator Ben Gilmore you come right here and uh Avery Cavello from Fayetteville, uh. That's right. And Senator Leding is she is senator's constituent. Thank you. Uh, please help me welcome them, uh, thank you, Madam President. Thank you, Senator Caldwell, and welcome to our pages to the Senate. Uh, before we ask for any other announcements or introductions, I would remind members to please stand either before or immediately after you are recognized by the presiding officer so that way Not only for those of us in the chambers, but also online, so remember to please stand before you begin speaking. Now, are there any other announcements or introductions before we go to the business agenda or before we read items at the desk. Announcements. Introductions. I don't see any Madam Secretary. There are items at the desk. Will your committee on engross bills to his first Senate Bill 12 by Senator King compared the engrossed copy of the original and find the same correctly engrossed. State agencies, where your committee on gross bills, who was first sent 89 by Central English compared the engrossed copy with the ritual and finds same correctly engrossed. Education where your committee on gross bills who was first sent 90 by Cenator English compared to engrossed copy with the ritual and finds the same correctly engrossed. Education for your committee on gross bills. was first sent 140 by Senator Boyd compared the grossed copy with the ritual and find some correctly engrossed. Insurance and commerce Committee on Engrossils, who was first sent by 147 by Senator Dodson compared the gross Cup with original and find same correctly engrossed state agencies for your committee on Education who was first Senate Bill 59 by central dismay recommend do pass calendar Committee on Judiciary to whom was first House Bill 1204 by Representative Eubank's recommend who pass calendar. Committee on Public Health to whom was referred Senate Bill 50 by Senator Boyd recommend due pass calendar Committee on Public Health to his 1st 134 by Senator Irving recommend DuP pass calendar Committee on Public Health team was first symbol 136 by Central Bo would recommend DuP pass calendar Committee on Public Health team was referred symbol 137 by center board recommend Du pass calendar. Senator Senate joint resolution 10 by Senator King. Constitutional amendment concerning efficiency in government and to provide for the creation of the Department of Government Efficiency, Senate Joint Resolution 10. State agencies, Senate resolution 11 by Senator Petty. commemorates the 100th anniversary on the on February 13, 2025 of the Robert W. Jack Veterans, a foreign, uh, foreign wars post 1322 in the city of Van Buren, the eldest veterans of Thorn Wars Post in Arkansas Senate resolution 11 calendar. Any announcements. And or introduction, seeing no other any further business to come before the body in the morning hour, if not the morning hour has expired. We will now begin the business agenda, beginning with Senate Resolution 10. Senate resolution 10 by Senator Wallace. In honor on February 5, 2025. The subsequent centennial of the founding of the city of Osceola, Senate Resolution 10. Senator Wallace, you're recognized. Governor, I'd like to ask for leave for mayor, um, to, to join me. Mayor Joe Harris. Thank you, Joe. Members, Governor, today we're recognizing Osceola. has a proud history. He was incorporated in 1875, 150 years ago, it was actually a village before then, 1837. It's a proud river town. Mark Twain used to talk about um Plum Point in Osceola when he was a steamboat captain and how difficult it was to traverse that uh part of the river. Also has a proud history of blues. We've had numerous individuals that have been uh singers, um, Frazier, Albert King, Harvey Skills, and Sun Cs. We've also had more modern singers, Buddy Jewel, you may remember, may have heard of Billy Lee Riley, Jimmy Thomas, and Reggie Young. Uh, Moola has a beautiful town square. They have a beautiful town spirit, they gather there with the farmers' market, uh, they have musicals there, bands, and it's just a, a real good community. And with that, I would ask you. That were asked to celebrate the rich heritage of Oso Main Street. That we recognize, uh, also the Heritage Music Festival since 1998 and that we recognize Osceola in South Mississippi County today, and my friends from Osceola in South Mississippi County or up here right now. Hello, folks. And be resolved that the Senate of the ninety-fifth General Assembly of the city of Arkansas that the Senate honors on February 5, 2025, that since Quentennial of the founding of the city of Osceola. And be it further resolved upon adoption, a copy of this resolution in this flag which has flown over the state capitol, be presented to the Osella mayor, Joe Harris Jr. by the Secretary of State, and Mayor Harris with that, I'd like to present you with this flag. All those in favor of Senate resolution 10 to honor on February 5, 2025, the subsequent centennial of the founding of the city of Osceola, please signify to saying I and he opposed as habit to Senate resolution 10 is adopted. And I, I would like to ask for leave for a mayor to see just a few words. Absolutely, Mayor, you're recognized to say a few words for the senator. Thank you, madam. And Thank you, my senator, Senator Dave Wallace. We, we have a great senator over there in Mississippi County. And to this chamber, I want to thank you for allowing this time to recognize the Cellar, And to this chamber, I want to thank you for allowing this time to recognize the seller, but I want you to keep one thing in mind. Osceola is the ideal place to live, work, and play. Thank you. Next, we will take up Senate Bill 77. Sending about 77 by Senator Mark Johnson to require the Arkansas Medicaid program to reimburse for physical therapy provided in a clinic-based setting. Senator Martin Johnson, you're recognized. Uh So Senator Wallace. He left his bill here. That's a copy, OK. Thank you, Madam President. Uh, members of Senate Bill 77 is a simple bill. It amends our physical therapy law to allow that Medicaid patients can receive their therapy, uh, in a, in a clinic-based setting, not just in a hospital setting. We have cases where people would be forced to drive past a clinic-based uh uh physical therapy clinic to get their Medicaid reimbursed, uh, therapy. some cases, that's uh many miles to have to go to the hospital-based clinic, uh, this was uh a problem that came up, uh, and they asked that we correct that again these uh professionals are the same licensure whether they're working in a hospital setting like my brother does in Conway or working in a clinic-based, uh, setting like my PT that I saw. After I had my injury 4 years ago in North Little Rock. So they're the same uh thing and they'll be, can be reimbursed. Uh, I will say some questions that come up about it and I wanted to uh read quickly a letter from Elizabeth Pittman, uh, from DHS about it and uh she said DHS has looked at potential impacts at this point, do not see a fiscal impact. While we do believe there may be a slight increase in utilization because of increased access, the cost of services will not increase. She says, additionally, all research we've done indicates that there should be savings from patients, not needing additional surgeries or drugs if they were able to access physical therapy more readily, and that's from Elizabeth Pittman, director of medical division of Medical Services. Uh, so this is a good bill and it'll help patients. I'll be happy to answer any questions. Any questions for Senator Mark Johnson. Seeing no questions. Anyone wish to speak against or for. Senator, you're recognized to close. I'm closed. Appreciate a good vote. Senator has closed any objection to rolling the boat? Hearing and seeing no one, Madam Secretary, please roll the boat. Boyd Bryant Caldwell, Clark, Crowe, Davis, Des, Dima Dotson English flippo flowers, Gilmore, Hammer, Hester Hickey, Hill on leave, Irving, Blake Johnson, Mark Johnson, King Lading love, McKee, Murdoch, Peyton, Penzo, Petty, Rice, Scott, Stone, Stubberfield, Soivan on leave. Tucker Wallace. Any senator wished to change his or her vote. Seeing no one, please cast up the ballot. By a vote of 33, 0, nay, Senate Bill 77 passes, please transmit to the house. Senate Bill 146. Senate Bill 146 by Senator Crowe to amend the definition of recreational purpose as used in relation to the liability of a property owner who makes land available to the public for recreational purposes. Senator Crow, you're recognized. Thank you, Governor. Tourism being the 2nd largest industry in the state. We have many state parks, lands, waterways, attractions, but we've always wanted to encourage private land owners to be allowed the public to recreational property. This is a 59-year-old Bill, and we are just simply adding some activities to this so that they have uh they have coverage of liability under this. Any questions for Senator Crow. saying no questions. Does anyone wish to speak against or for the bill. Senator, you are recognized to close. Appreciate a good vote closed. Senator has closed. Any objection to rolling the vote, hearing and seeing no one, Madam Secretary, please roll the boat. Boyd, Bryant Caldwell, Clark, Kroll, Davis, Des, dismay dots and English flippo flowers, Gilmore, Hammer, Hester, Hickey, Hill on leave, Irving, Blake Johnson, Mark Johnson, King, letting love, McKee. Murdoch, Peyton, Penzo, Petty, rice, Scott, Stone, Stuberfield, Sullivan on leave, Tucker Wallace. Any senator wished to change his or her vote. Seeing no one, please cast up the ballot by a vote of 33, 0, nay, Senate Bill 146 passes, please transmit to the house. Senate Bill 150 with Senator Blake Johnson. Senate Bill 150 by Senator Blake Johnson to amend the law concerning the state and public school life and health insurance program and to amend the powers and duties of the director of the Employee Benefits division. Senator Johnson, you're recognized. I want to know who didn't run their bills because I thought this was further down Thank you members. Uh this bill is pretty simple, uh, whenever our retirees Uh, this kind of predatory, these uh Medicare Part C and D programs and one of our retirees, you know, go into one of those, they can roll, they roll out of our program and there's no good way for them to get back in. And this will allow the director to be able to get those retirees back into our system rather than be manipulated by by the TV commercials and things like that. That's pretty much what it is. It's just, uh, for him to be able to to uh take care of those retirees that mistakenly go into programs, which is less advantageous to them. Any questions for Senator Blake Johnson. Seeing no questions. Anyone wish to speak against or for the bill. Senator has closed any objection to rolling the vote. Hearing and seeing no one, Madam Secretary, please roll the boat. Boy, Bryant, Caldwell, Clark, K Crow, Davis, Des, Dima Dotson English Flippo flowers, Gilmore, Hammer, Hester, Hickey, Hill on leave, Irving Blake Johnson, Mark Johnson, King letting love, McKee, Murdoch, Peyton, Penzo, Petty, Rice, Scott, Stone, Stubberfield, Sullivan on. Tucker Wallace. Any senator wish to change his or her vote. Seeing no one and please cast up the ballot. By a vote of 33 0 nay Senate Bill 150 passes, please transmit to the house. Senate Bill 182. Senate Bill 182 by Senator Gilmore to require a local government to continue to operate under under the annual appropriation ordinance for the previous year until a new appropriation ordinance is adopted and to declare an emergency. Senator Gilmore, you're recognized. Thank you, Governor. Members, I think I've had a chance to visit with most, most of you, if not all of you. And let me just say this bill comes as a result of what's transpiring in Jefferson County. Um, I first of all want to say thanks to my colleagues, Senator Flowers for stepping up for uh her county as well and the whole delegation in Jefferson County for their work on this because it is so vital that we get that county back to operating. Members, the bill's pretty straightforward, um, basically says that they will operate under a previously adopted budget, um, and if they don't do that, the consequence of that is they will lose the quorum Court will lose per diem and the county judge will lose salary for every day that they don't adopt a budget. Pretty straightforward bill. The reality is what we're dealing with, there's about 300 plus county employees that haven't been paid. Uh, this has been going on for a little over a month, and these are people who are struggling to make ends meet. These are people who are missing their mortgage payments. These are people who are not able to pay their The utility bills, so the reality of this is staggering when you think about it. They had a quorum court meeting last night. I watched the Corum court meeting. It was troubling to say the least. Um, there's a lot of bickering, there's a lot of, and I'll just, let me just say there's wrongs on both sides of this whole issue, but we as public officials are called to rise above that. We're called to cancel out the noise and do what we're, what we're supposed to do for the people that we represent. So that's what I'm asking, I'm asking. a good vote on this, understanding the issues that have arisen and understanding that hopefully none of y'all have to deal with the situation like what we're dealing with in Jefferson County. But if you do, this piece of legislation would target that. So with that, I'm not going to belabor the point. I'm happy to take any questions. Questions for Senator Gilmore, Senator Love. You're recognized for a question. Thank you, Governor. Um, Senator Gilmore, I'm in, I'm, I'm right in line with the spirit of this, but, uh, let me ask you, do you know if that comm court passed a budget last year. I've been told that they did. OK. All right, just, just wanted to check on that. Thank you so I've been discussing that with the county association. They, their language so that we get it right to address, you know, we don't want unintended consequences with this bill. And so considering all of that, language was suggested and is in the bill. One of the things that was brought up in the course of this is we don't want a county to operate with the deficit. They can't do that for uh operation of law. So we've tried to work through any of the possibles that that may arise with us. OK, all right, thank you. Thank you. Any other questions for Senator Gilmore. Senator Clark, you're recognized for a question. Senator Gilmore, did I say there, did I hear you say there was a penalty uh for the uh quote unquote members and county judge in this bill. Yeah, there is good. Thank you. Thank you, sir. Any other questions for Senator Gilmore, Senator Blake Johnson, you're recognized for a question. I'm sorry, Senator, you know, where we've been for the last 2.5 hours. I'm well aware, had to question while we were in there about, you know, this also including the municipal uh Mayors and council is there a particular case that that we have at this time. No, we just didn't want to single out any particular, we just want to include local government. Just, just in case, because this may come up in many, many cases, so we're just trying to be inclusive. So I mean it'll help protect those employees and, and for any future cases. That's correct. Thank you. Thank you. Senator Mark Johnson, you're recognized for a question. Thank you, Madam President. Senator Gilmore, I'm very supportive of this bill. I had a question about the loss of turnback and other funds. Is that something that would be prorated if, let's say they don't pass their budget by the end of the year, and a week late, they, they pass it. Does that bring them back to the turn back they would get for that full month, for example, or is it a ated by how long they, in this case drag it out over over a month. Well, to be clear, this, this bill doesn't take away turn back. It the the teeth in it would affect their per diem and salary, and yes, it's prorated based on how long it takes over the period of time it takes them to get a budget passed. So the longer they procrastinate, the more it would hurt them. That's correct, and I hope that they move expeditiously. Then that's the way it should be. Thank you, sir. Thank you, Madam. Any other questions for Senator Gilmore. See know the questions. Does anyone wish to speak against or for the bill. Senator Gilmore, you're recognized to close. Thank you, Madam Governor. I just, members again, I just want to thank you um for your support on this bill. I appreciate a good vote and again, I appreciate my colleagues in Jefferson County and their support. I know that this matters greatly to folks like myself and Senator Flowers and and the representatives that are on the bill as well. So again with that, I'm closed. Appreciate a good vote. Thank you, Senator Gilmore has closed any objection to rolling the boat? Without objection, Madam Secretary, please roll the boat. Bowen front, Caldwell, Clark, Crowe, Davis, Des, dismaying dots and English flippo flowers, Gilmore hammer, Hester Hickey, Hill on leave, Irving, Blake Johnson, Mark Johnson, King letting love, McKee Murdoch, Peyton, Penzo, Petty, Rice, Scott, Stone, Stubberfield, Sullivan on leave, Tucker Wallace. Any senator wished to change his or her vote, saying no one, please cast up the ballot by a vote of 33 yeah, zero nay, Senate Bill 182 passes and the corresponding emergency clause is adopted, please transmit to the house. House Bill 1271 1271 by Representative Warren in Central Pennzo to amend the law concerning mechanics and materials lies and clarify the priority of liens and and mortgage construction loans. Sander Penzo, you're recognized. Thank you. House Bill 1271 clarifies the priority of liens and construction loans, uh, currently, um, if a person starts construction on a home, they have a hard time getting a construction loan because the construction process has already started. Um, so a bank can't secure, um, uh, secure the loan to the property because they have to be at the very end of all of the lies that have been filed mechanics' liens, material liens, so that's from uh digging the footings from the very start to the touch up painter at the end, doesn't matter where the bank comes in in the process, they would be after the touch up painter at the very end, so banks are very reluctant to put loans on homes that have already started. What this bill does is it allows the bank to like if somebody thinks they've got enough cash to build a house, they would get started, get about halfway through and realize that they don't have enough money to finish. This bill would allow them to go to a bank, the bank to verify that all the liens have been satisfied, that have been followed up and to that point, allow them to file their, their lien for the mortgage and then continue the construction process, um, and then it would just be like it was a new construction home from that point forward. So it, it helps people that have thought They could start a house and didn't have the money to finish it, be able to go out and get a loan for the, to finish the construction of the home. Um, this is a land title bill, uh, bankers, realtors are all on board with it, so to my knowledge, there isn't any opposition from anybody. I'd be happy to take any questions. Any questions for Senator Penzo, Senator Caldwell, you're recognized for a question. I've been in building business a long time and normally when this takes place, if uh uh lien material supply company or a plumber or anyone else goes on the job and starts a job first and then the bank files their mortgage, then everyone is ahead of the bank. Now I understand where we need to get to. The real question is, this bill, if, if when you say that they have the opportunity to satisfy all liens. Then the bank can file their mortgage if a mechanic person, a plumber, electrician, or a material supplyman has material on that job, has not filed a lien, is this gonna take their ability to file a lien or get paid. There's a provision in there where they're supposed to check 4 days before or 4 days after within that window to make sure there are no materials on the job site. Fair enough. Thank you. You bet. right. Hold on, let me get going here. Senator Love, you're recognized for a question, and then Senator Hickey, you will be recognized. Oh. OK, Senator Pen, so it's kind of on the same lines as I'm thinking of what uh Senator Caldwell is saying. So if, if I'm a contractor and I've done, just say I've done the plumbing. And, and I haven't gotten paid. They go and get this mortgage. Where, where do I fall? Where do I fall in line of getting paid because if, if this becomes a superior. In, in the, in the current construction process, the, the mortgage is the superior lien because it's filed prior to all workman's or material liens, correct? I mean, if somebody pulls a construction loan, that property has the bank. As their first place. OK. Um, so if construction's already started and the the plumber's done his work before the bank files because they want to verify and make sure they're in the first place position. They're gonna make sure the plumber and everybody has been paid off. That had liens on the property. I get that and then so they're gonna become the first place lien position and then any lien that's filed after that. would be in that order, so it allows them to get to get a position under a current statute, their position is last place no matter what in the between workman's, it doesn't matter if the work's been done or not, if the bank files their mortgage. And then A month later, the painter comes in to paint. The painters before the bank. That's why banks won't loan money on construction projects that have already started. Because they, they can't secure their Their interest in the property. OK. I think I'm I I think I'm getting what you're the plumber is gonna be one of the first guys in and then he's gonna be one of the last guys out too because he's gonna come in and finish out the fixtures, but he's, he's gonna, you know, because he's gonna be there before they pour the the foundation to do plumbing work that's there, and then so he's gonna have a lien at that spot, but then he's also going to be at the end of the process too. So I mean, anything he did before the bank filed their mortgage. They're going to make sure he was paid off because the bank's gonna wants to ensure that they're in their first place position before they loan money to finish the home. So, but does, but all right, so with this bill, does that mean the bank jumps the front even if they, if, if these, if these lies have not been satisfied. No, because they would go in after any existing liens. It just allows them to take a position. Right now they can't take a position. So if there's liens in place already. Like there's, let's say there's 3 liens and then the bank files the mortgage. They're the 4th. So they're in 4th position. I, I understand what you're saying. I just don't, I'm, I may not agree with it, but OK, all right, thank you. No, I, I get what you're saying. OK. Senator Hickey, you're recognized. And then Senator Stone and believe me, I grieve. I agree with what you're trying to do here. I just want to make sure I have the A fullfi of the way this really works because this has been an issue I've dealt with this for years. Of course they don't have to anymore, but, but I guess this is my thing with what you're saying. So you, you mentioned the materials not being there, but let's just say that so somebody, somebody has a, has a property paid for. They have uh A couple $100,000 they thought they could build their house, so they went out and tried to build their house, of course they couldn't. Inflation whatever cost overruns, so they needed another $100,000. What you're trying to do, of course, is to make it so that they can go to the bank to borrow the 100,000, correct? OK. Because right now they really can't, right, so that that's a preteve and I think that's a great deal for consumers, I guess what I just want to make sure I fully understand is this part on page 2. Where it says that the that the lender, the finance company, I guess, the person who is, yeah, whoever's going to hold the security interest or the mortgage. That they can rely on this lasting praiser, surveyor or engineer, so they're going to go out and look and they're, and what I understood you to say, they're gonna say, well, there's not any materials on site. But the thing would be if if that house had already been built, there would be materials on site. From that partially finished house. And the possibility of labor. That was there, are, are we saying that the appraiser surveyor, engineer. They're going to assume that liability. To say that that, that plumber. Or or that those materials that are already standing in that framing package is standing up, are they going to assume the liability that those have already been paid for, or are they gonna research that to make sure those materials have been paid for, whose job is it to say that that framing package had been paid for that plumber or that electrician on that partially completed home. Are you saying there's a, a framing package that's been set out on the driveway and it hadn't been set up yet. The one that standing up, so it's already been. Well, it's a partial build house and Or, or let's just say that the, you know, so the plumbing's roughed in the slab, you know, so they're in there, somebody's got in there and whatever, wherever we're at in that partial uh completion of the house, you know, we could use whatever, so let's just say that the roof's on, but you know, so the wiring stretched. Who's gonna say that the elect that that electrician. Has already been paid because the work has commenced. He's done his work. Is that on the, is that on the The holder of the security interest, or is that or is that liability now gonna be on the appraiser, surveyor, engineer, the three here who are actually going to go out and look at it. The way I see it, the appraiser, surveyor, engineer are going to state what they see. It's going to be the burden's going to be on the lender to verify that those items have been paid for, is the way I see it. OK, if that's the way it is, I, I mean, I guess that's fine. I guess my next thing is and and I I heard what you said on the bankers and, and that's fine. You said they were good with it. I don't know why they would have to have an appraiser or a Uh, surveyor or an engineer, which is someone that's going to have to be paid because it'll feel it could be that they send out one of their employees who would be knowledgeable in construction work, and they could see that we're at this, that we're at this stage of the house. And know that they need to go check and make sure that the dirt work had been paid for, that the plumbing rough end have been paid for, the slab. The framing, the plumbing top out. I so I didn't, I didn't know why we were narrowing it down to those 3 if they weren't going to have any, assume any liability. Well, I guess, I guess that would depend if it was a a good local bank or if it was one of the nationwide banks, because I'm sure the local banks are going to send their own guys out to to verify. I mean, I, I just didn't know that they're going to have the option here. I know it says May. But Maybe they don't have to, but But again, I just, I don't know who the liability is gonna fall back on if, if that, if that electrician doesn't, uh, if he's not actually been paid and that appraiser goes out and does that like you say. I guess maybe at that point, maybe the bank has to go find out who did the work and get a signed affidavit from each one of those subcontractors. I mean, my, my understanding is the, the, the liability would fall on the bank to verify that they were in the fair enough lean position. OK. All right, again, there is an issue and I appreciate you bringing it. I just, uh, I, I hope it's done, done the right way. Again, I appreciate you bringing it. Thank you, sir. Thank you. Senator Stone, you're recognized, followed by Senator Clark and then back to Senator Caldwell. Um, Senator Penzo, I basically had the same concerns that uh Senator Hickey had, and I think my questions have been answered, but you're just saying that the bank is gonna have to verify that all the contractors have been paid, is that correct? Yeah, they don't, I mean, the whole purpose is for them to be in a, a first place lean position. If they don't verify, that's on them because then they might be in 2nd, 3rd, 4th position. I guess if they're going to verify that everything's been paid. I still don't understand the purpose of the inspector. going out there. But if everybody's good with that, I'm, I'm gonna tell you it's not adding up to me, honestly, but I've asked all the questions I want to ask. Thank you. OK, thank you. Senator Clark, you're recognized for a question. They Sent Penzo, it seems, and maybe I'm reading this wrong. But it seems that We're assuming that somebody's old. has followed. And I can look and I appreciate what you're trying to solve, but let me tell you what I have seen over 50 years, how this normally happens, like I said, somebody starts out thinking they can build a house. They get almost finished usually. And find out they can't. And if you're 30 days late, I ain't following. If you're 60 days late, I haven't following. If you're 90 days late, I'm getting ready to file a lien because I only got 120 days and I at 110 days at 10 days before I have to file a notice 10 days before I file the lien, so I really got 110 days if I want to get up there. So really most of us have not filed a lien until we get to 90 days. Uh, but, um, you know, I may have provided the the lumber, the plywood, the windows, the insulation, the flooring. The drywall, the siding, I could have supplied one of those things or all of those things, those are a good chance that I'm owed a lot of money. But I ain't following. Uh, and the materials there, it ain't stacked up somewhere because it's all been installed, uh, and I don't see that that I'm protected there. I say if I follow a lien that I'm protected, but if I haven't filed a lien, I don't see that I'm protected. OK, so in a let's let's say under current without this bill passing. Are, are you protected? No, well, I'm protected because yes, if I want to go as far as forcing to sell the house. To perfect the lien, then, then yes, I have a protection there. I want them to be able to get the loan, so I appreciate what you're trying to do, but I also, but let's let's there was a time 40 years ago, 30 years ago, maybe even and 50 years ago when if somebody had a loan, let me come back to somebody who got a loan on the front end. I could, if they say they've got a loan, I can open an account. Because the bank's going to call me. And make sure this was way back in ancient history. The banks will call me and make sure I've been paid before they give the next draw. They don't do that anymore. They just give them the drug and if they don't pay me. That's tough and so being in that situation and now I've already supplied this material, and the bank said, well, we're at the front and we didn't know you were owed any money. Uh, I've been in that place before. So let me ask you what the difference is in the scenario you just laid out. If the bank is in first position. Or, or 5th position. What, what difference In that scenario for the bank to get into the first position, there has to be a way that they assured for following or not, that creditors have been paid. That's the whole reason it doesn but it doesn't change anything. From, from what you're saying, because if the bank on a new construction house, no work's been done. Let me tell you how it changes it. If I'm owed a lot of money, because if I'm owed a little money, I follow the lien and hope that someday the house sells and I can get paid because I'm owed a lot of money. I'm going to follow through. I'm going to perfect the lane. I'm going to force that house to be sold, and I'm gonna be at the, I'm gonna be at the front because I don't know if the house is going to go for a whole lot less than what it should have gone, especially if it ain't finished, and I'm gonna be at the front of the list so the bank being at the front of the list and so I'll get paid and instead of the bank getting paid is at the front of the list right now. Not if they, not if they haven't low money. Uh when they normally when they they start out and they loan money, yes, but at this scenario, that's why they won't loan money because they're not at the front of the list. So, and then I get moved back in the in the banks only got to protect themselves. They don't have to worry about me at all. Let me, let me throw this scenario out there, would have, what if they don't have the money to pay you and if they got the loan, they'd have the money to pay you. If the bank makes sure I get paid, I'll be fine. That's what I'm saying. I have no problem with being at the front because if I've got a lien, they're gonna make sure I get paid, but I'm saying I'm owed money whether I follow the lien or not, and that's not what we do. That's not what that's not what electricians do. It's not what plumbers do. We're patient. We just don't run to the courthouse and file a lien. Uh, and, and so unless it's they really got behind, there's not any lies out there, uh, but it's still gonna have to be the bank's responsibility. to somehow make sure other than liens that everybody's been paid for them to get to the final list. That make sense? I Senator Clark, perhaps you could Have a concise question. I think we're going back and forth with hypotheticals that if you're in the business, it's not hypothetical. It's it's exactly what happens. I understand what all of you all are saying, I just, there have been several back and forth hypotheticals, and I just want to make sure that our questions that are being asked are ones that you all can understand but also members of the public can understand as well. If they're members of the public who would be following these lanes, they very much understand. I'm asking questions directly on the bill, Madam Chair, and to do with the bill and I would appreciate if you pulled it down so we can discuss these things, uh, because as it stands, I can't have a bank come in and leave me holding the bag, uh, uh. I'll, uh, I'll pull this one down today. We'll, we'll have some discussions to make sure we're All on the same page and I'll, I'll bring it back tomorrow or whenever. Thank you. Thank you, Senator Penzo. House Bill 1271 has been pulled down. I would remind members that there is always time to speak for and against bills. After a senator has answered questions. We'll now take up House Bill 1273. How spell 1273 by Representative Warren in Central Pennzo to provide that a lean created by entry of certification of certification or indebtedness issued by the Secretary of the Department of Finance Administration is not superior to a purchase money mortgage. Senator Penzo, you're recognized. Thank you. I think this one's non-controversial, but I thought the last one was. So let's, let's see how this goes. Uh, House Bill 1273 clarifies the superior superiority of liens between the Department of Finance and Administration and a purchase money mortgage. This bill is just providing language where there is none for the state of Arkansas, this language will mirror what is currently in place with the IRS when someone purchases a piece of real estate with any level of investment in it and secures a loan for the balance owed, the resulting loan is considered a purchase money mortgage. DFNA has agreed that any lien they have is inferior to this type of mortgage, and they're actually mirroring the IRS on this right now. This will just put in practice. it'll put in this practice and statute. So this has already taken place in the state right now. Any questions for Senator Penzo. Senator Center love You're recognized for a question, followed by senator dismay. Senator Penzo, is this just for liens for DFNA are these all text links because I'm, I'm looking at the bill and Yeah, are these, are these just for the liens imposed by DFNA or DNA. OK. All right, thank you. Senator dismaying that you have a question? Yeah, if you can, what, what is walk me back through purchase money mortgage, and is that just a traditional mortgage or what does that mean? OK, yeah, what is that exactly? You know, it's, it's any, any loan uh for a, for, yes. Like if you, if you put money down on a house and take out a loan, that's a purchase money mortgage. So just make sure I understand that's putting DFA ahead of that or behind it, behind it. They already consider their lean inferior. But there's nothing in code stating that because that's the, the practice of the what, what happens at the federal level. So the state's currently mirroring that it's just not in statute right now. So if you buy a piece of property and someone else had a a lien on, you know, placed on them by DFA known or unknown because there's no notice requirement by DFA when a lien is placed on someone. I mean, there's, there's no green card, you just, there can be a lien filed uh without anyone else being aware besides DFA because there's there's no affected service. So it's gonna turn up in a title search, right? Not necessarily. Uh, Traditionally, but not necessarily depending on where it's filed because you may have the property owner in a different place that's more complicated than that. Um, but, but what you're saying is if that lien exists, From DFA, it will follow the mortgage. I'm not because I That's what I don't guess I understand. I mean, I almost think it reads the opposite. If I'm reading it right, it says they're superior to. Am I missing, I don't what I am. I agree, I mean. It's the opposite, I think the way that that's worded. is superior to. Uh It's saying it's superior to other liens. Other than, OK, other than the purchase money mortgage. OK. Did this come from DFA from the banking community land title. OK. All right, thanks. And Senator Hickey, you're recognized for a question. It just, again, I'm just making sure I along the same lines the senator dismay, so So DFNA files a lien. We're saying that their lien is, is, is going to continue to be superior other than if it was for purchase money, right? Right, OK, so if somebody had a 2nd mortgage on their home, they purchased it for 200,000, so that's a purchase money that's a purchase money mortgage. That's what they use, they, they purchased the house with that. So the the 200,000 right there we're going to say that DFNA cannot get ahead of that of that 200,000, correct? If it's, yeah, if it's a purchase money mortgage, OK, right, that's what I'm saying. But if I understand this right, let's just say, which happens all the time, if somebody had come in and did a 2nd mortgage for their home, uh, for, uh, let's just say for a home improvement. So they did did that. Now DFNA is still going to be able to get ahead of that particular one. So I think that what might have been different than what you said, but the way I read it, The way I read it is the only thing that they can't get ahead of. It's going to be the purchase money. That's, that's my understanding is the purchase money. The second mortgage could fall after. I can't my understanding is that's what it would be. OK, I thought I understood that you had said, you know, all loans or whatever, but I don't to purchase the property, but any, any money that was used to do repairs on the house or, or whatever, they're going to be the purchase money if it's a bank would be first, then DFNA somebody doesn't pay their taxes, they're going to wind up being 2nd, even if there's a second mortgage on on that, then that's. second mortgage then becomes 3rd in all actuality. If, if the second mortgage wasn't utilized to purchase the home. That's correct, yeah, that's the way I read it. That's my understanding. Thanks, sir. Thank you. Any other questions for Senator Penzo. Seeing no other questions. Anyone wish to speak against or for. Senator is recognized to close. OK. Senator Penzo, do you wish to close? You wish to close senator has closed. Any objection to rolling the boat? Objection noted, Madam Secretary, please call the roll. Bo You wish to close senator has closed. Any objection to rolling the boat? Objection noted, Madam Secretary, please call the roll. Boron Brant. Caldwell Clark. Clark, Crowe Davis, Davis. Days days, this man. This man Dotson, English. English Flippo. Flowers? Gilmore. Hammer, hammer. Hestery. Heke Hill on leave. Irvin Irvin. Like Johnson Mark Johnson. King lighting. Laing Love love. McKee. Murdoch Murdoch. Peyton. Hayden Penza. Patty, rice. Scott. Stone. Stone, step a fill. Sullivan on leave. Tucker, Tucker. Wallace I Any senator who wishes to vote, who did not vote, I see Senator Gilmore, yes, Senator Davis, yes. Senator Love present, and the other senators on this side, Senator dismaying, yes. Senator Hickey, yes, Senator Stone, yes, Senator Ervin, yes. Senator Hammer, yes. Any others? Senator English, yes. Any others, please check the board seeing and hearing no others, please cast up the ballot by a vote of 29, 0, nay, 3, not voting, 1 present. House Bill 1273 passes, please return to the house. We will now take up the budget calendar, send her dismay. I'll go ahead and just kind of announce it. had members on your desk, you're gonna find the budget calendar if you can pull that out. I wanna go through each one of these, um, and then if there's something that you'd like to pull out for an individual vote, just let me know, um, and so on those, all builds are fairly similar, similar, except for the first one, which is the legislative liaisons for the session. There was no ask for an increased appropriation or position in that. Uh, so I'm gonna read these out one at a time and the rest are related to higher ed institutions. So first, Senate 80 105. 107. 108 109. 112. 113 114. 1:15. Senate Bill 125. 126 or 129. Would you like to pull any of those out to be voted upon separately. I see none. for those dispatch. And Senate Bill 80 by joint budget, an act for the Office of Governor legislative liaisons appropriation for the 2024, 2025 fiscal year. Symbol 105, an act for the University of Arkansas Community College at Batesville Appropriation for the 2025, 2026 this year. Simba 107. My joint budget and I for the Southeast Arkansas College Appropriation for the 2025, 2026 fiscal year. 108 by joint budget and act for the SAU tech appropriation for the 2025, 2026 fiscal year.y by 109 by joint budget and act for the Arkansas for the Southern Arkansas College Appropriation for the 2025, 2026 fiscal year. Sin Bill 12 by joint budget and act for the Arkansas State University may be appropriation for the 2025, 2026 fiscal year. So 113 by Trump budget and act for the Arkansas State University, Newport Appropriation for the 2025, 2026 fiscal year. Civil won 14 by joint budget tonight for the for the Arkansas State University Three Rivers Appropriation for the 2025, 2026 fiscal year. See my 115, my joint budget and act for the University of Arkansas Community College at Marlton Aropriation of 2025, 2026 fiscal year. So by 125 by joint budget tonight for the University of Central Arkansas. appropriation for the 2025, 2026 fiscal year, December 126 by joint budget and act for the University of Arkansas Pine Bluff Appropriation for the 2025, 2026 fiscal year. So by 29, my joint budget and I for the University of Arkansas at Monticello preparation for the 2025, 2026 fiscal year. Thank you, Madam Secretary. You all have heard the block of Bills from joint budget. Anyone wish to speak against or for seeing no one, the senator has closed any objection to rolling the vote, that objection, Madam Secretary, please roll the boat. Boyd, Bryant Caldwell, Clark, Crowell, Davis, Des, dismaying dots and English flippo flowers, Gilmore, hammer, Hester, Hickey Hill on leave, Irvin Blake Johnson, Mark Johnson, King letting love McKee Murdoch, Peyton. sends out petty rise Scott stone Stubberfield, Sullivan on leave, Tucker Wallace. Any senator wish to change his or her vote. I see Senator King not voting. Any other senator. Please cast up the ballot. By a vote of 32 ye, zero nay, and 1, not voting. The batch of budget bills passed in the corresponding emergency clauses are adopted, please transmit to the house. Are there items at the desk? 200 by central hammer to include textbooks and other instruments, instructional materials that are leased in the exemption from the groce receipts tax, Senate Bill 200 revenue and tax. Senate Resolution 13 by Senator Hammer. Recognize the bright Hornets football team is the Class 7A state champions Senate Resolution 13 calendar Senate Resolution 14 by Senator Hammer and Senator King to recognize February 9 through 15, 2025 is Eureka Springs FBLA Weeks, Senate Resolution 14 calendar Senate Resolution 15 by Senator Hammer on a retired director of the Arkansas Department of Transportation, Laurie Tudor for her 41 years of service to the department and to the people of the state of Arkans. and to congratulate her on her retirement Senate resolution 15 calendar. Are there any announcements or introductions, center English, you're recognized. Thank you. I would just like to remind folks at the Pulasi County Chambers of Commerce will be holding their reception from 5 till 7 at the Victory Building. Senator Hester. Hey, members, we're gonna do something a little bit different tomorrow. We're gonna come in at 10:00 a.m. I, I've spoken with all the chairs of the committees and they've made adjustments, but we're, we're gonna come in at 10 a.m. tomorrow and then it probably next week we'll start on Thursday, we'll move it to 1:30, probably depending on because it seems like things are getting busier, but tomorrow morning 10 a.m. Any other announcements, Senator Caldwell, you're recognized. will meet 15 minutes upon the adjournment tomorrow. Senator Blake Johnson, you're recognized. Insurance and commerce is canceled for Thursday. Madam Secretary, are there items at the desk? Senate Resolution 16 by Senator Irving to designate the month of February as National Children's Dental Health Month. Senate Resolution 16 calendar. If nothing further, the Senate will stand in adjournment subject to the clearing of the desk until tomorrow, February 6, 2025 at 10:00 a.m.