Legislators rub hands over $70 million

LITTLE ROCK — A day after a federal judge’s order portended an end to Arkansas’ obligation to pay nearly $70 million a year in desegregation aid to three Pulaski County school districts, state lawmakers began discussing Friday how to spend the money.

U.S. District Judge Brian Miller ordered an end to most extra money for the Little Rock School District, the North Little Rock School District and the Pulaski County Special School District. Officials and legislators from other school districts in the state have for years complained that the three districts got the extra money on top of other state school aid while their districts did not.

Richard Wilson, assistant director of research for the Bureau of Legislative Research, told members ofthe Arkansas Legislative Council that state law is not clear on where that money could go. He said some lawmakers think that themoney will be part of general revenue, which is distributed to state agencies for their operations, and school superintendents think the money will be part of public-education funding in which their districts would share.

Wilson said that how the money is spent in the future “is to be determined” by the Legislature through the budgeting process.

Wilson said the state has provided $1.06 billion to the three districts since 1989. He said in the first 10 months of the current fiscal year, fiscal 2011, the state provided$65.1 million in aid to the districts.

Sen. Jason Rapert, R-Bigelow, suggested removing the remaining state sales tax on groceries.

“It soundslike that particular promise that’s been made, that’s been worked on by the session for the past several years, actually could be achieved with this particular money,” Rapert said.

Wilson said it would cutstate general revenue $45 million to eliminate the grocery tax.

A one-eighth percentage point tax on groceries is required by Amendment 75 of the state constitution for conservation matters such as the Game and Fish Commission.

During this year’s legislative session, lawmakers cut the sales tax on groceries from 2 percent to 1.5 percent, a $20.8 million-a-year cut in fiscal 2012 revenue. Since 2006 the tax has been cut from 6 percent.

Gov. Mike Beebe’s spokesman, Matt DeCample, said the state should move slowly in thinking about spending the money.

“It’s probably a few steps ahead of where we are right now,” DeCample said.

Wilson also cautioned lawmakers against getting excited about the ruling.

“It’s very voluminous anddifficult to understand; of co urs e with that amount of money we’re surely expecting appeals,” he said.

Sen. KimHendren, R-Gravette, said lawmakers were acting like children.

“We got the news yesterday of what Judge Miller’s done, and we’ve got that money spent today, haven’t we?” Hendren said. “Whatever money is left here could be returned to the people of Arkansas as a tax cut.”