Friday, June 9, 2017

Week In Review

State Capitol Week in Review
June 9, 2017
            LITTLE ROCK – The Highway Commission voted to begin an effort to put a proposal on next year’s ballot, so that Arkansas voters can decide whether to increase spending on highway and bridge improvements.
            The vote was 5-to-0. The details will be worked out during future meetings and the Commission expressed hopes that a final plan would be ready by October. After the substance of a highway program is finalized, supporters of the initiative can begin collecting signatures.
            The governor has said that voters should have an opportunity to vote on a highway plan. During the 2017 regular session earlier this year, a bill to put a highway program on the ballot failed in the House of Representatives.
            In statewide elections in 2011 and again in 2012, Arkansas voters approved major highway programs. In 2011 voters approved the Interstate Rehabilitation Program, which authorized the issuance of $575 million in bonds that the Highway Commission used to match federal funding to pay for more than $1 billion in highway improvements.
            In 2012, voters approved a half-cent sales tax, which will last until 2023, to finance the Connecting Arkansas Plan. It will pay for $1.8 billion in road and bridge projects.
            The bill that failed in the House of Representatives would have allowed voters to decide whether to levy a 6.5 percent sales tax on wholesale fuel, to authorize a bond issue. The plan would have financed a highway program of about $200 million a year.
            In a special session last year the legislature voted to dedicate 25 percent of each year’s budget surplus to the Highway Department. Legislators also approved some transfers of funds within state government to increase highway funding by about $50 million a year without raising any taxes.
            The Highway Commission did not decide whether to promote an initiated act, which will require 67,887 signatures of registered voters in order to be placed on the 2018 ballot, or a constitutional amendment, which will require 84,859 signatures. Those signatures must be submitted to the Secretary of State for verification by July of 2018, in order for the measure to be on the ballot in November of 2018.
            In the coming months, highway officials will work with business leaders, economic developers, contractors, truckers, elected officials and consultants to determine the size and scope of the highway proposal. They also will determine the funding mechanism, with an eye towards choosing the method that is most likely to be approved by Arkansas voters.
            The head the Arkansas Trucking Association said that the group would prefer a simple increase in motor fuels taxes. A penny a gallon increase would generate about $14 million a year in additional revenue for the state Highway Department. However, some highway officials questioned whether the public would approve an increase in gasoline taxes.
            In recent years, efforts to transfer general revenue to the highway department have failed. State general revenue collections pay for education, prisons, health care and numerous other services provided by state agencies. 
Highway funding is generated by user fees and gas taxes, and is considered special revenue because it is dedicated solely to the Highway Department.
             A significant part of the effort will be to inform voters how much the plan would cost, and where the money would be spent. Voters in rural areas would be reluctant to pay for improvements to highways in urban areas. 

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