Ark. gov. says state can succeed in recession

LITTLE ROCK — Gov. Mike Beebe challenged legislators to improve life in Arkansas despite a grim economy, telling them that good students are entitled to college scholarships and that smokers and other tobacco users should pay for a statewide trauma network.

"Finding success in prosperity is admirable," Beebe told a joint session of the House and Senate during his State of the State address on Tuesday. "If we can capture success and continue moving Arkansas forward during a national recession, it will be a landmark of true achievement."

Beebe proposed a 56-cent-per-pack increase in the state's cigarette tax and said tobacco chewers, too, should pay for a statewide trauma system and for a host of other health programs around the state.

The governor, who said last week he would call for at least a 50-cent increase in the cigarette tax, acknowledged that he was relying on a dwindling revenue source by effectively increasing the cost of tobacco products. Beebe, however, said that the drop in revenue would be offset by the savings from reduced tobacco-related health costs.

"It will make our citizens and our bottom line healthier," Beebe said.

Beebe offered his address to lawmakers on the second day of the legislative session, as lawmakers face a more dire economy than when he took office two years ago. Then, Beebe and lawmakers enjoyed a nearly $1 billion surplus.

Telling lawmakers he wants it run with "efficiency and transparency," Beebe offered lawmakers direction on the lottery approved by voters and championed by Lt. Gov. Bill Halter.

Beebe said the lottery, which was approved to pay for college scholarships, gives the state a chance to take another look at its scholarship programs.

He called for expansions of the state's existing achievement- and needs-based scholarships programs, and proposed simplifying the process for applying for the scholarships.

"Scholarships are only beneficial when students can access them. We need simpler paperwork," Beebe said to loud applause. "I'll go further and say we need less paperwork and where there is paperwork, the state and the people the taxpayers pay to do these things ought to be the folks worrying about paperwork and putting the students where they need to be, not the families."

Beebe, who has disagreed with Halter over whether a new scholarship program is needed using the lottery revenue, said he wants to avoid running out of scholarship money.

"When we promise scholarships, the money must remain available if the student remains qualified," Beebe said.

The governor continued his push for his top legislative item, cutting another penny off the state's 3-cent sales tax on groceries. Lawmakers unanimously approved Beebe's proposal to cut the tax from 6 cents to 3 cents in 2007, and some legislators have raised concerns about another cut in the tax during the recession. Such a cut would cost the state about $30 million annually.

"I know it's going to be tough for some of you, but I ask you to join me," Beebe said. "We can do this. We can afford to do this."