Arkansas lawmakers to start special session today

The Arkansas General Assembly will convene this morning for a special session on a number of issues, including regulating pharmacy benefit managers, expanding a state tax break to use college savings plans for kindergarten-12th grade expenses and changing the open-container law to avoid losing $12 million in federal highway funds.

Other topics include permits for hog farms and a proposal on juries in lawsuits.

After the House and Senate adjourned their 29-day fiscal session Monday afternoon, Gov. Asa Hutchinson issued the call for the special session to start at 9 a.m. today. No legislative committee meetings were scheduled as of 7 p.m. Monday, according to the General Assembly’s website.

“The plan is to get in and get out in three days,” said Senate President Pro Tempore Jonathan Dismang, R-Searcy.

Nearly a month ago, Hutchinson announced plans to call the special session to consider bills on regulating pharmacy benefit managers and tweaking the open-container law. Dismang and House Speaker Jeremy Gil-lam, R-Judsonia, asked the governor to call a special session to keep the focus of the fiscal session on budget matters.

Hutchinson said Monday that he made a commitment to hold the special session to address those two items that warranted immediate attention by the Legislature as well as other issues deemed unique in circumstance if legislators could reach a two-thirds consensus in both chambers.

“The items on the call reflect that commitment, and I look forward to working with the Legislature to address these issues in a quick and efficient manner over the next three days,” the Republican governor said in a written statement.

Included in the governor’s call for the special session is legislation relating to hog farm permits issued by the Arkansas Department of Environmental Quality.

Hutchinson’s proclamation calls for amending state environmental laws to limit the issues the public can raise on permits belonging to existing hog farms.

Public review would only apply to modifications proposed by the hog farm, and a hog farm that is in “good standing” won’t be subject to review or appeal over “siting or location issues” that were not raised during the public review period in which the farm was initially permitted.

Rep. Jeff Wardlaw, R-Hermitage, said he plans to sponsor the legislation that “absolutely does not affect C&H [Hog Farms].”

Instead, the bill would specify that “once you get a permit, you can’t have protests beyond the comment period” after the 30-day period for filing suit in circuit court expires, he said.

The Arkansas Department of Environmental Quality denied C&H Hog Farms, located on a creek that feeds the Buffalo National River, a permit application in January after public comments raised concerns about whether the farmers followed proper protocol in their application process.

The farmers, because of the location of the farm, should have submitted an emergency action plan and a groundwater flow direction study.

The farm was already permitted but had to reapply for a permit when its existing one expired. The farm has appealed the department’s decision, and groups opposing the farm have intervened in the case.

Leaders of the Buffalo River Watershed Alliance and the Ozark Society said Monday that they’re worried that the bill would affect C&H’s existing appeal and, if passed, allow it to continue operating indefinitely and render the case moot.

Dismang said he hasn’t seen that particular bill nor does he know what its impact would be.

Sen. Ronald Caldwell, R-Wynne, said he has 28 other senators and roughly 80 representatives signed onto his bill to allow the state Insurance Department to regulate pharmacy benefit managers.

“I think we have good support,” he said.

Caldwell said other states are considering legislation to regulate pharmacy benefit managers, but Arkansas could be the first state to enact such legislation.

The legislation was drafted after pharmacists crowded a legislative meeting room over cuts in reimbursements to pharmacies for generic drugs provided to many Arkansas Blue Cross and Blue Shield customers, including Arkansas Works enrollees, that took effect Jan. 1.

The pharmacists also called attention to reimbursement practices by CVS Caremark, the pharmacy benefit manager for Arkansas Blue Cross and Blue Shield plans.

Hutchinson’s call for a special session includes legislation that would change state law to allow taxpayer deductions for Arkansans to use their college savings plans for primary and secondary school expenses.

The governor agreed to add that legislation to the call to clear the way for legislative approval of the state treasurer’s appropriation last week.

The appropriation failed to clear the House because of a controversial provision to extend tax benefits to families that withdraw funds from their state-run 529 college-savings plans for expenses at kindergarten-12th grade private, religious or public schools.

The investment plans, administered by the treasurer’s office, allow taxpayers to deduct from their state taxes up to $5,000 in contributions, or $10,000 per couple. Each year, an individual or family can then withdraw up to $10,000 from the plan, tax-free, to pay off higher-education expenses.

Congress last year adopted changes to the plans, allowing withdrawals for K-12 expenses — such as private school tuition and tutoring — to be exempt from federal taxes. Under current Arkansas tax law, those kinds of withdrawals would still be subject to state tax unless the law is changed.

The state Department of Finance and Administration projected that a proposal allowing Arkansans to use funds from their 529 college savings plans for K-12 expenses would cost the state up to $5.2 million a year.

But Sen. Jason Rapert, R-Bigelow, who backed the proposal that had the 529 plan language, estimated his measure would probably cost the state about $2 million to $2.5 million a year. But critics of the proposal suggested it would cost more than $5.2 million a year.

Hutchinson’s call for a special session also includes legislation to align state law regarding open containers of alcoholic beverages with federal law to avoid penalties.

Without the changes in state law, the Department of Transportation would be limited to using about $12 million in federal highway construction and maintenance funds for safety purposes starting in the federal fiscal year beginning Oct. 1, 2018, department spokesman Danny Straessle said last month.

Another bill placed on the call by Hutchinson aims to affirm a section of the Arkansas Constitution allowing for the waiver of jury-trial rights.

A December decision by the Arkansas Supreme Court in a civil foreclosure case has left uncertainty for holders of existing contracts that already include jury-trial waivers, said state Sen. Jeremy Hutchinson, R-Little Rock, an attorney and sponsor of the legislation.

The legislation says such waivers, when agreed to by both parties, are “presumptively valid, irrevocable, and enforceable,” and cannot be voided if one party claims to have not read or understood the waiver.

“The fact that there’s thousands and thousands of contracts that could be invalidated is the reason this is urgent,” said Sen. Hutchinson, who is a nephew of Gov. Hutchinson.

Information for this article was contributed by John Moritz of the Arkansas Democrat-Gazette.