Thursday, January 18, 2018

Week In Review

State Capitol Week in Review

            LITTLE ROCK – In a decision that may have significant financial consequences for the Arkansas Medicaid program, federal officials have approved a Kentucky proposal to require recipients either to work or look for a job in order to qualify for some Medicaid benefits.
            States administer Medicaid and share the costs with the federal government. If a state wants to make any changes in eligibility, it must first gain approval from the federal Centers for Medicare and Medicaid Services. Approval comes in the form of a waiver.
            Arkansas, like Kentucky and about 10 other states, has sought waivers that would allow them to impose a work requirement for people who qualify for Arkansas Works, a category within the Medicaid program. Once they are fully implemented they would apply to beneficiaries from 19 to 49 years of age.
The requirements will not apply to people who are 50 or older, or people who are in a category known as “medically frail.” Pregnant women and people who are caring for children under the age of six are exempt too.
            Although Arkansas officials have not yet received official notice of a waiver, they were optimistic that one would arrive shortly because of the similarities in the Arkansas and the Kentucky requests.
            Arkansas also has asked for a waiver allowing us to lower the eligibility threshold for Arkansas works, from 138 percent to 100 percent of the federal poverty level. That would affect about 60,000 of the 285,000 people now receiving benefits from the Arkansas Works program.
            There are similar work requirements for food stamps. Exemptions include children, senior citizens and people with disabilities.

Snow Day Changes
            Thanks to Act 862 of 2017, the many school districts affected by winter weather last week will not have to make up a snow day later in the spring. Act 862 allows them to provide “alternative methods of instruction” when snow forces the cancellation of classes.
            Schools prepare by sending home packets of instruction that students work on at home when it snows. Teachers are expected to monitor online work and answer phone calls and emails. Judging by news reports, it went well for the most part but there will be some bugs to work out. Parents had to help figure out assignments.
            One result is that yet another acronym – AMI - has been introduced into the education system. It stands for alternative method of instruction.
            Educators hope that using AMI instead of declaring snow days will prevent the need to extend the school year into June, when classes would conflict with summer school and families’ summer plans.
            Another recently enacted law, Act 143 of 2015, gives school superintendents more flexibility in managing schedules affected by winter weather. It allows superintendents to delay starting times until as late as 10 a.m. due to inclement weather, and schools will not have to make up that day later in June.
If it begins to snow after classes have already begun, schools can close as early as 1 p.m. without having to schedule a makeup day. Schools can apply Act 143 as many as five times a year.

Thursday, January 11, 2018

Week In Review

State Capitol Week in Review
            LITTLE ROCK – The governor presented his balanced budget proposal to legislators, who will act on the plan during the fiscal session that begins on February 12.
The bulk of the increased spending next year would be for the Medicaid program, which subsidizes health care for people with disabilities, the elderly who need long term nursing care, and low-income families.
The Division of Children and Family Services, which recruits foster families for children who have been abused or neglected, is set to receive an additional $7.3 million. That will allow it to hire 65 additional caseworkers.
Under the governor’s proposal, state prisons would get an additional $3.5 million, bringing their estimated total from state general revenue to $353. The agency that administers drug courts, parole and probation is due to get an additional $1.7 million, bringing its total to almost $88 million for next year.
            Although the governor proposes a balanced budget every year, it is the legislature that has final authority to review and approve all state agency spending requests. 
For example, during budget hearings when the governor presented his plan, one senator expressed a desire to increase funding above the governor’s recommendation so that the state can hire more parole and probation officers. The average caseload is 120 for about 468 officers. The senator said he would introduce an amendment to add 30 new officers.
During the fiscal session legislators will adopt budgets for state Fiscal Year 2019, which begins on July 1. Fiscal sessions last for 30 days, but can be extended to 45 days if a 75 percent majority of each chamber votes to extend. The state Constitution does not allow for an additional extension beyond 45 days.
The Arkansas legislature used to meet every two years, but voters approved a constitutional amendment to authorize yearly sessions, with session in even-numbered- years strictly devoted to appropriations. The first fiscal session was in 2010.
Although the legislature will only consider budget bills during the fiscal session, there is a mechanism for considering non-budget matters. However, it requires the approval of a supermajority of two-thirds in each chamber to be able to introduce a non-budget bill.
Typically during a fiscal session, the legislature will approve about 300 separate appropriations to authorize spending by state agencies and institutions of higher education.
            The proposed budget for next fiscal year is based on an estimated increase in spending of almost $173 million, which would bring the total of state general revenue spending to $5.6 billion.  
Arkansas also collects special revenues, such as motor fuels taxes for highway construction, and we receive federal matching funds for highway programs, education and health care. This fiscal year the total of all sources of government spending in Arkansas will be an estimated $29.6 billion.
Medicaid relies heavily on federal matching funds. Arkansas, like other relatively poor states, receives a high percentage of matching funds compared to prosperous states. The federal government has matched our Medicaid funding by paying for 70.87 percent of total costs. However, due to recent improvements in our per capita income, the match rate is dropping slightly, to 70.51 percent. The change means that the state will contribute an additional $48.6 million to the total cost of Medicaid in Arkansas.

Thursday, January 4, 2018

Week In Review

State Capitol Week in Review
            LITTLE ROCK – In a letter to the State Police, the governor said that open carry of a firearm is not a violation of state gun laws, as long as there is no intent to use the weapon unlawfully.
            This is the second time since 2015 that a state constitutional officer has written that open carry is legal. An attorney general’s opinion from 2015 says that “in general merely possessing a handgun on your person or in your vehicle does not violate” statutes about firearm possession.
            In response to the governor’s letter, the director of the State Police sent a memo to troop commanders saying that “openly carrying a firearm does not alone provide probable cause for arrest.”
            The governor, a former U.S. Attorney, and the current state attorney general both cite Act 746 of 2013, which spells out when it is permissible to carry a firearm on a journey.
            The attorney general’s opinion was issued August 28, 2015 and is 17 pages. It is number 2015-064. It outlines the legal changes made by Act 746.
            Although open carry is legal, someone who carries a handgun should remember that the police may lawfully question them about their purpose. The officer may detain the person carrying the firearm due to suspicions based on the persons’ demeanor and activities, or based on information supplied by a third person, or because of known criminal activity nearby.
            Private property owners are still entitled to keep firearms off their property, and a person carrying a handgun can be prosecuted for criminal trespass if they enter that property against the owner’s wishes.
            There are still prohibitions against carrying a firearm into public buildings such as jails and courtrooms.
            Act 746 changed state law so that there is no longer a presumption that possession of a loaded handgun indicates any intent to commit an unlawful act, according to the attorney general’s opinion. The burden of proof is now on the prosecution to prove that the person carrying the gun intended to do something against the law.
            The opinion states that Act 746 does not overturn any rules affecting concealed-carry permit holders, and laws requiring concealed carry permits are still in full force and effect. A person may not carry a concealed handgun unless he has a concealed-carry license. In fact, the opinion says, the courts would likely consider flouting of concealed-carry laws to be a presumption of intent to do something unlawful.
            The opinion discusses the “journey exception,” which allows you to carry a firearm in your vehicle either in the open or concealed, as long as you have no intent to use it unlawfully. The journey exception does not override other gun laws, for example, you cannot bring a gun in your vehicle and park it on the grounds of a prison just because you’re on a journey.
Once the gun owner takes it out of the vehicle, the journey exception no longer applies but the person may lawfully carry the gun as long as he or she has no intent to use it unlawfully against another person. If the person conceals it while carrying it, he or she must have a concealed-carry license.
Act 746 passed by a vote of 82-to-1 in the House of Representatives and 28-to-0 in the Senate.

Thursday, December 28, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – Many challenges facing state government in 2018 will have a familiar ring, but will take on a modern twist.
            A good example is Medicaid. The state administers the health care program for people with disabilities, the elderly and low-income families, and since it was created in the mid 1960s state watchdogs have been working to improve efficiency and accountability.
The Department of Human Service administers Medicaid, and the department plans to introduce an innovation in 2018 to control costs for home care and personal care, which in Arkansas run about $800 million a year. The department will contract with a software firm to will operate a cloud-based “electronic visit verification” method to reduce fraud. The new system will use technology available on smart phones.
About 15 other states are doing something similar to hold down costs in their home care programs. The idea is to make sure that personal care workers have actually visited the homes of Medicaid patients when they file claims for reimbursement.
Home care and personal care workers are paid to visit Medicaid patients to help with household needs like personal hygiene and preparing meals. After the new verification system is in place, the smart phone of the home care worker will record and transmit a log of its location and the times it was at particular locations. Computers can verify that the phone has actually been at the home of the Medicaid patient, and for how long. 
The system will work even if the home is out of cell phone range, because modern phones have clocks and GPS that continue to work even when the device is not in range of a cell tower. After the worker gets back within cell phone range, a record of the visit will be transmitted to monitors.
After difficulties implementing a new computer system, the department has a digital verification system in place that in 2017 removed about 80,000 Medicaid recipients from the rolls. For example, the department now checks a recipient’s income by accessing files at other agencies. It also checks whether an Arkansas recipient is receiving Medicaid benefits from another state.
State officials expect other changes in the Medicaid program in 2018, when they learn from federal agencies whether proposed reforms for Arkansas Works will be approved. Arkansas Works is the expanded Medicaid program that Arkansas implemented after passage of the federal Affordable Care Act.
The state administers Medicaid, but because the federal government provides the vast majority of its funding, changes in eligibility or level of service in Arkansas Works must first be approved by the federal government.
The department has asked for approval of a plan to reduce eligibility from 138 percent of the federal poverty level to 100 percent. Also, the state wants to add a requirement that some recipients work, look for work or take job training in order to qualify for Medicaid.
When the legislature convenes in a fiscal session in February, one of the most important bills to consider will be the appropriation that authorizes Medicaid funding. Passage of the funding measure will require a 75 percent majority in each chamber of the legislature.

Wednesday, December 20, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – The past year has been eventful for state government, and the development that may have the most positive long-term impact for the Arkansas economy was passage by the legislature of a $50 million-a-year tax cut for low income families.
            Act 78 of 2017 will lower state income taxes for everyone whose income is less than $21,000 a year. People whose annual incomes are below $4,300 will be taken off the income tax rolls completely.
            An analysis by the Bureau of Legislative Research estimates that Act 78 will reduce taxes for 1,346,415 Arkansas residents.
            The legislature also eliminated state income taxes for retired veterans. Act 141 of 2017 exempts military retirement from state income taxes. About 29,000 Arkansas veterans served long enough to qualify for retirement benefits, and Act 141 will save them about $13.4 million a year.
            Both tax reductions are expected to improve the Arkansas economy in various ways. First, much of the tax savings will be spent on groceries, housing and necessities instead of going into the state treasure. Secondly, state economists expect the tax cut for veterans to make Arkansas an attractive location for military retirees. If locations in Arkansas attract more veterans, those communities will benefit from their expertise and willingness to serve.
            Act 465, also passed by the legislature earlier this year, exempts sales taxes for manufacturers when they purchase equipment for repairs and replacement of parts. It sunsets an existing tax incentive program known as InvestArk. The tax exemption will be phased in, beginning July 1, 2018.
            The savings to manufacturers will begin accumulating in 2020, when the loss of InvestArk is more than offset by the sales tax exemption. In Fiscal Year 2020 the savings to manufacturers will be $230,000, but they will increase rapidly and in 2023 will be more than $12.3 million a year.
            Because Arkansas had approved a medical marijuana amendment in November of 2016, the legislature had to create from scratch a totally new regulatory system. Lawmakers wanted to make sure that marijuana would be prescribed and sold handled like a medication, and they also wanted to make sure that the amendment would not become a gateway allowing easier access to recreational use of illegal drugs.
In all, the legislature considered 51 bills and enacted 25 that implement aspects of the medical marijuana amendment. There will be 32 dispensaries and five growers that will open for business in 2018.
Act 191 of 2017 was a priority of business leaders because it clarifies the legal position of employers in civil lawsuits. Under the act, supervisors acting on their own are not considered employers. The legal result is that lawsuits against employers will not be pursued under the category of hate crimes. The act creates a one-year limit in which discrimination and retaliation suits can be filed against employers.
Act 734 of 2017 is another priority of business leaders. It lowers the base wage on which employers pay unemployment insurance taxes, from $12,000 to $10,000. The change will save Arkansas businesses about $50 million a year. Act 734 also shortens from 20 to 16 weeks the length of time someone may receive unemployment insurance benefits.

Thursday, December 7, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – Since the legislature enacted a law in 2015 that requires Arkansas high schools to offer computer science, the number of students in computer classes has increased by 460 percent.
            In the 2014-2015 school year there were 1,104 students in computer science classes and now there are 6,184, according to the state Education Department. The number of teachers qualified in computer science has grown from 27 to 225.
            The governor made it a priority to expand computer science offerings and the legislature approved Act 187 of 2015 to require all public high schools and charter schools to offer the courses. The act also created a task force charged with recommending standards for the new courses.
            Enrollment in computer science classes grew by 12 percent over last year. Among minority students the participation rate is 39 percent and among females it is 26 percent. The governor and educators said that the gender gap in computer classes should be eliminated and that they would continue working to increase the number of females in computer coding classes.
            At the same time that the growth in student enrollment was announced, the governor and state education officials announced that 12 adults would receive scholarships worth $6,000 at the Arkansas Coding Academy at the University of Central Arkansas in Conway.
            Four of the scholarships will go to state employees – one from each Congressional district. They can get paid leave while taking coding classes and must agree to continue working for the state for an additional two years.
            It is public policy to enhance computer literacy among Arkansas students and the state’s workforce, for several reasons. High-tech industries will be more likely to locate in Arkansas if there is a well trained workforce in place. Our brightest graduates are more likely to live in Arkansas if they can find well-paid jobs here, rather than having to move out of state.
            In a related effort, legislators and state officials have been working to provide broadband access to all public schools. Arkansas is one of six states to meet recommended national standards for data transmission. In fact, Arkansas capacity is double the recommended standard. The new network delivers data 40 times faster than the previous one.
New Nursing Program
            The University of Arkansas at Fort Smith, in conjunction with two local hospitals, announced the beginning of an accelerated nursing program that will begin in the fall of 2018. It is open to students who already have a bachelor’s degree. They can obtain a nursing degree in 15 months. The program will accept 32 students per semester.
            There is a nursing shortage nationwide, due in part to the aging of the current generation of nurses. The dean of the UAFS college of health sciences said that the average nurse is 56 years old. 
            Nursing schools struggle to meet the demand from potential students because of a lack of faculty and constrained budgets, she said. The nursing shortage is not confined to Arkansas, but is a nationwide challenge. The UAFS program will be similar to 270 nursing programs in all other states.
            The American Association of Colleges of Nurses reported that last year 64,000 applicants were turned down by nursing programs because of a lack of faculty or slots.

Thursday, November 30, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – Since its creation in 2005, the state’s program to pay for school facilities has paid local school districts more than $930 million and committed to paying $283 million by the end of 2019.
            School districts match the state dollars, and since 2005 the combined amount of spending on new school facilities is $2.54 billion.
            Several types of projects qualify for facilities funding. A common type is construction that makes sure school buildings are safe, warm and dry. Those projects could be new buildings, or they could be replacements of a school’s heating, air conditioning, fire alarms systems or roofs.
            Also qualifying are new facilities made necessary by growth in enrollment. Other projects add space for academics or to convert space into an academic area.
            It is called the Academic Facilities Partnership Program and it is for major renovations and new construction projects, not for general repair and maintenance. For example, projects costing more than $150,000 typically qualify for funding. Another measure is that projects qualify if their cost is more than $300 per each pupil
As a consequence of the Lake View school funding lawsuit, the legislature determines adequate funding levels for public schools every year. The lawsuit was filed by a small, rural school district and it challenged the existing school funding formula as inequitable and inadequate. A court ruling in favor of the Lake View district concluded that not every school in Arkansas had equal opportunities to build, renovate or maintain facilities. 
The court ruled that under the state Constitution, it is the legislature’s duty to provide substantially equal buildings and equipment for academic instruction, even in schools in relatively poor areas of Arkansas.
            In 2003 the legislature created a special committee to study the facilities needs of schools, and in 2005 lawmakers created the funding program.
            The agenda of the Senate Committee on Education had an update on facilities funding, which was prepared by legislative staff.
            Another result of the Lake View lawsuit has been increased statewide funding for alternative learning environments (ALE) in every school district. Students are sent to an ALE for various reasons, such as pregnancy, disruptive behavior and homelessness if those reasons are a factor in the students’ persistent lack of academic progress.
            The state distributes money for ALE to schools in addition to the basic school funding known as foundation aid. This year that amount is $26.4 million, or $4,640 per student in ALE programs. About 5,500 students in Arkansas are placed in ALE classes.
            The state Education Department recommends that no more than 2 percent or 3 percent of a district’s students be placed in alternative learning environments. Some students are in ALE programs for only part of the day and spend the remainder of their time in traditional classes.
            Schools write a specific learning plan for each student, with academic goals and expectations of improved behavior. Last year, about a fourth of the students returned to their school’s traditional classrooms.
            Students in alternative learning environments tend to have lower scores on standardized tests, and to drop out of high school at higher rates than the student body as a whole.

Tuesday, November 21, 2017

Week In Review


State Capitol Week in Review
November 24, 2017
            LITTLE ROCK – State-supported universities in Arkansas spent $176 million on athletics last year, a 6.3 percent increase over the previous year. Two-year colleges spent $600,000. 
            About 72 percent of the income that was spent on sports came from ticket sales, license fees and sources of athletic department income. Almost $26 million, or 13 percent, of the money spent on athletics came from fees charged to students.
            Universities may spend a certain proportion of their state funding on athletics. Last year they spent $12.6 million in state aid on athletics.
            A state law enacted in 1989 requires colleges and universities to submit annual reports on athletic expenditure to the Higher Education Department. The institutions must use uniform accounting procedures and standard definitions of what amounts to spending on athletics, so that comparisons are valid.
The report on athletic spending in 2016-2017 was presented to the state Higher Education Coordinating Board at its October meeting.
            The University of Arkansas at Fayetteville has by far the largest athletic program in the state. Its total spending on athletics last year was more than $106 million. However, due to the popularity of Razorback athletic events, the university brings in so much revenue from ticket sales, royalties and licensing fees that it does not use any state aid to supplement its sports budget.
            The only other institution that did not transfer from its general education budget for athletics was the University of Arkansas at Fort Smith. Its athletic budget was $3.5 million.
            Arkansas State University at Jonesboro spent $18.2 million on athletics, the University of Central Arkansas at Conway spent $12.5 million and the University of Arkansas at Little Rock spent $9.2 million.
            Salaries represent a large proportion of total spending on athletics. All Arkansas institutions of higher education spent more than $62 million last year on salaries in their athletic departments. That was 35 percent of the total amount spent on athletics.
            The Razorback athletic department spent $30.1 million on salaries. ASU athletics spent $4.4 million on salaries. UCA and UALR each spent $2.8 million on athletic department salaries.
            The second largest spending category for university athletic departments was scholarships for players. The statewide total was almost $31 million.
            The Fayetteville campus reported that $9.3 million went for athletic scholarships. ASU reported $5.5 million, UCA $4 million and UALR $2.5 million.
            Other significant expenses of the Razorback athletic program were game guarantees to universities whose teams play at Fayetteville. That item cost the program $3.6 million last year. Debt service cost the athletic program $11.4 million. Team travel cost $9 million. Fringe benefits for personnel cost $6.9 million. Rentals and maintenance of facilities cost $7 million.
            Equipment and uniforms for Razorback players cost $3.6 million. Medical expenses and medical insurance cost the athletic program $1.6 million.
            Ticket sales to Razorback games brought in $40.7 million in revenue. Another $16 million came from the NCAA and Southeast Conference, which distributes revenue from television networks to its members. Broadcast rights for television, radio and Internet streaming brought in $30.1 million. Royalties and licensing, from firms paying for the right to use the Razorback logo and from sales of souvenirs, brought in $14 million.

Thursday, November 16, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – When the governor and the director of the Arkansas Economic Development Commission journeyed to China and Japan on a trade mission, it underscored how important foreign trade is to the Arkansas economy.
            For example, more than 20 companies have manufacturing operations in Arkansas that employ about 5,300 people.
            Two years ago there were four Chinese companies in Arkansas that hired about 10 workers, but since then our connections with Chinese businesses have changed dramatically. In the past 18 months four other Chinese companies have agreed to open manufacturing plants in Arkansas. Their combined investments in Arkansas will total more than $1.7 billion and they will create about 1,500 jobs.
            According to the AEDC, plants owned by foreign companies employed more than 34,500 Arkansans last year. Most of those jobs were in manufacturing, mainly industrial machinery, food and timber products, metals and transportation equipment.
            The largest foreign-owned companies with Arkansas locations are from the United Kingdom, Japan, France, Switzerland and Canada.
            Exports to foreign markets are important to the Arkansas economy. According to the International Trade Administration, which is a branch of the U.S. Department of Commerce, 2,365 businesses in Arkansas exported goods overseas on 2014. They employed 49,000 people.
Of the Arkansas companies that exported products to foreign countries, 80 percent were small or medium sized businesses.
            The Commerce Department reported that last year the countries that bought the most Arkansas products were Canada, France, Mexico, Japan and China. The top Arkansas products sold abroad were transportation equipment, chemicals, processed foods, machinery and paper.
            Engines and parts for civilian aircraft were a major component of the transportation equipment exported by Arkansas firms. Rice and poultry products, including eggs, were at the top of the list of food products exported from Arkansas.
            About 47 percent of Arkansas exports are to countries which have signed free trade agreements with the United States. The most significant, measured in dollars, is the North American Free Trade Agreement, or NAFTA. Also, Arkansas firms ship products to the Dominican Republic and central American counties under the CAFTA-DR agreement, and to Singapore, Australia and Colombia under separate free trade agreements.
            Almost $6 billion worth of Arkansas products were exported overseas in 2015. The AEDC has offices in Shanghai, Tokyo and Berlin with officials who promote Arkansas as a location for foreign companies looking to expand.
Prison Overtime Pay
            A legislative committee reviewed a request by the state Correction Department to spend an additional $2 million on overtime pay for security officers.
            The money will be transferred from other prison programs. State prison units are working to fill vacancies and retain experienced personnel. Of 4,700 positions 300 are vacant, according to the director of prisons.
            State prisons this year have experienced an alarming number of violent incidents in which officers are injured and in which inmates have been injured or killed. The State Police told legislators they have investigated 28 assaults by inmates on guards this year.

Wednesday, November 8, 2017

Week In Review

State Capitol Week in Review
            LITTLE ROCK – In its past two regular sessions the Arkansas legislature has lowered state income tax rates and also made significant reductions in other types of state taxes.
            In preparation for the next regular session, in 2019, a panel of legislators is working on further tax reductions. The Senate chairman of the group has said that further reductions of about $100 million a year should be a starting point for income tax reductions.
            The Tax Reform and Relief Legislative Task Force has 16 members – eight from the Senate and eight from the House of Representatives. Its duty is to recommend changes in the state tax code that will create jobs and make Arkansas more attractive to businesses. Also, it will recommend reforms that will modernize and simplify the tax code, while making it fairer for all taxpaying entities within the state.
            During a series of early November meetings at the Capitol, the task force concentrated on the structure of the Arkansas sales tax and our various excise taxes. In December the task force is scheduled to focus on property taxes and will bring in experts from other states that have recently enacted tax reforms.
            Sales taxes are one of the three major sources of revenue for Arkansas state government, along with individual and corporate income taxes. The task force has contracted with a consultant to research our tax structure and compare it with other states.
The research indicates that Arkansas is very near the national average in the percentage of state revenue that is generated by sales taxes. Nationally, the average is 47.5 percent and in Arkansas it is 48.6 percent.
            Sales taxes fall within the category of taxes on consumption. One of the main arguments against over reliance on sales taxes is that they can be regressive, meaning that poor people pay a higher proportion of their income on sales taxes than do people in upper-income brackets.
            On the positive side, sales taxes are economically efficient because almost everyone pays them. They are not collected on two major generators of economic growth, which are capital investment and people’s savings. They do not create a disincentive that dampens people’s motivations to work and earn more.
            The Arkansas sales tax was adopted in 1935 and the current state rate is 6.5 percent. In 1981 the legislature granted cities and counties the authority to hold elections on locally applied sales taxes. Voters in more than 200 of the state’s 500 municipalities, and in 73 of our 75 counties, have approved local option sales taxes.
            Arkansas, like most states, has approved exemptions from the sales tax for specific industries or products. Groceries and medications are commonly exempted, either partially or totally. 
Arkansas exempts motor fuels from sales taxes, which lowered state revenue by $380 million in 2011. However, motorists and truckers paid even more in taxes when they filled their tanks. In 2011 motor fuels taxes on gas and diesel generated $444 million.
            Excise taxes are collected on specific items or activities, such as tobacco, alcohol, tourism and gaming. Nationally, excise taxes generate 16.2 percent of states’ revenues, on average. In Arkansas they generate 13.5 percent of state revenue, or more than $1.3 billion a year.