Gov. Asa Hutchinson's proposals to give more than $13 million from the state's "rainy-day" fund to help a handful of projects -- including $7.5 million for workforce training grants and $4.5 million to University of Arkansas for Medical Sciences' education programs -- sailed through a legislative panel Tuesday.
The Republican governor's proposals cleared the Legislative Council's Performance Evaluation and Expenditure Review Subcommittee. The rainy-day fund will have a remaining balance of $39.4 million if the Legislative Council approves the requests on Friday, said the subcommittee co-chairman, Sen. Bruce Maloch, D-Magnolia.
The governor also proposed using the rainy-day fund to help settle a lawsuit, to match federal funds for a river navigability study and to support summer gifted and talented programs.
"At least some of these [uses of the rainy-day fund] were probably contemplated in the fiscal session," Maloch told his fellow lawmakers, referring to one of this spring's fiscal sessions.
Hutchinson uses the fund for emergencies, and for special needs and his priorities that aren't included in the general revenue budget that totals $5.33 billion in fiscal 2017, which started July 1. The money comes from the General Improvement Fund, which is surplus cash from the state budget and is used for one-time projects.
The governor requested $7.5 million in rainy-day funds for the state Department of Higher Education's Workforce Initiative Act of 2015 Fund.
"These funds are needed to support workforce implementation grants to institutions throughout the state," Hutchinson wrote in his letter to the Legislative Council's co-chairmen, Sen. Bill Sample, R-Hot Springs, and Rep. David Branscum, R-Marshall. The $7.5 million will be coupled with carryover funds to help provide $7.8 million in regional workforce implementation grants, Harold Criswell, senior associate director at the Higher Education Department, said after the subcommittee's meeting.
As to the requested $4.5 million for UAMS' Medical Center Fund, the "release is needed to assist the university with medical education program expenses for the upcoming school year," the governor wrote in his letter.
The money will be used for education programs at UAMS' Little Rock and Northwest Arkansas campuses as well as its eight regional programs, Wendy Cartwright, senior legislative analyst for the Bureau of Legislative Research, told lawmakers.
After the subcommittee's meeting, UAMS Chancellor Daniel Rahn said the university's officials have been working with Hutchinson regarding long-term financial needs.
"This is one-time money and it is going to help us in this fiscal year," Rahn said.
"We have large needs," he added, and "we are just going to keep chipping away at it."
Hutchinson also sought approval for $600,000 to help the state Department of Veterans Affairs pay a lawsuit settlement. The department also is using $225,000 from its cash balance to help pay the settlement, Cartwright told lawmakers.
Earlier this month, a Pulaski County circuit judge signed a settlement for $850,000, including a $252,568 payment to 288 nurses and assistants who sued the department over its policy of docking workers for lunch breaks whether or not they took time off. The settlement also requires the department to pay $551,566 in legal fees and expenses to the nurses' attorneys: John Holleman, Timothy Steadman and Matthew Ford of Holleman & Associates law firm of Little Rock. The rest of the settlement will go to 51 of the plaintiffs and for miscellaneous expenses.
Department Director Matt Snead told lawmakers that the settlement stemmed from a class-action lawsuit filed a few years ago, and the goal was to settle for less than $1 million.
"In August of last year, we implemented time clocks" to avoid future problems, Snead said.
The governor also proposed giving the Arkansas Waterways Commission $374,938 for project expenses related to the Three Rivers Study pertaining to the Arkansas, White and Mississippi rivers.
After 50 years of concerns and temporary fixes around the three rivers in the Arkansas Delta, state and federal officials last year signed a $3 million cost-sharing agreement to begin a study on finding a permanent solution to ensure that the waterways stay navigable. The state will contribute $1.5 million to the three-year study. The other $1.5 million will be provided by the federal government.
Cartwright said lawmakers approved the governor's request to use $700,000 from the rainy-day fund for the study in August 2015.
Gene Higginbotham, executive director of the Waterways Commission, said, "We basically have taken 11 alternatives and worked it down to two alternatives" in the study.
"Now all the work is going into an economic impact, trying to determine which has the best cost-benefit ratio," he said.
"Then after that, I'll be back in front of you one more time. But next year, it's $270,000, which will complete the $1.5 million [in state funds] that we agreed to with the [U.S. Army] Corps of Engineers as the local sponsor," Higginbotham said.
The study will be completed in February 2018 with a final option and "see if we can't get the federal government to pay 100 percent of the cost," he said.
Hutchinson also proposed giving $140,000 to the state Department of Education to help pay for gifted and talented summer programs.
Metro on 08/17/2016