Fiscal Session Preview

Here is the Week 11 update!

Things are gaining steam as we rapidly move through the calendar.  We estimate just about two weeks left in this 2017 Session.  Each day dozens of bills are considered and as I have mentioned before most are not controversial and are very bipartisan.

Here is an issue we are facing right now…

How are we going to pay for our highway needs?

Our infrastructure is essential for a growth oriented Arkansas.  Our roads must be able to deliver the goods we want and send out the wonderful products we produce.

I am committed to finding the funding for our highways.  I have had several conversations with the Arkansas Highway and Transportation Department and am working closely to help the AHTD in several ways.  

Perhaps you heard of the gas tax proposal.  This would have placed a gas tax on the wholesale level of 6.5% on the ballot for the voters to approve in November of 2018.

I feel we should look at a variety of options before choosing a Gas Tax.  We have alternative avenues to pursue and I feel the voters of Arkansas expect us as their Representatives to roll up their sleeves and do the necessary work to find those options.

For instance, there is a bill which would place the vast majority of the internet sales tax toward the highways. (Some of you just took a step back… “Wait!  What??  Did he say ‘Internet Tax’?  Amazon.com is already collecting state tax.  More will follow.  That’s a topic for another post.  Let’s get back to the highways 😃 )  Even if that only brought in 100 million dollars of the 200+ needed by highways, that could mean we send to the voters a 3.25% wholesale gas tax in stead of 6.5%.

Internet tax affects middle to upper incomes more than a tax at the pump which would have a more adverse effect on lower incomes.

Another major consideration in my opposition to this as a first option is the voting public themselves.  The Good Roads commission reports that 48.5% of the Arkansas voters approve of the 6.5% hike at the wholesale level.  That’s close to being 50.1% needed to win, but that is most likely not the actual number.  On the same survey, only 11% said they would approve of a 10 cent increase at the retail level (price at the pump).  6.5% at the wholesale is right at 10 cents at the retail level.  Meaning the same question was asked twice in a different way and the answer for public support is somewhere in between 48.5% and 11%.

This concerns me because if we send a measure to the voters 18 months from now, and it fails (which the numbers indicate it would) we would then be two years down the road with no plan in place to address the issue.  This means two more years of decaying roads and infrastructure.  Each mile of highway repair costs on average $200,000.  But if we fail to repair on time, the cost goes up to $1.5 Million.  This is the “stitch in time saves nine” principle.

This is why I am committed to finding a solution now and doing the heavy lifting early in 2017 so we don’t fail in the Fall of 2018 and have to start over at the beginning of 2019 in a much worse physical and fiscal situation.

On the bright side of the roads, I was able to present and pass HB which enables the Arkansas Highway and Transportation Department to use the Contruction-Manager Method on a trial basis.  This is a method which speeds up the process of construction saving money and time (which saves more money)!  This passed the House and Senate unanimously.  Other states have used this to save the taxpayers millions of dollars due to the seamless transition of steps in the process from design, engineering, and construction of highways.