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story.lead_photo.caption Gov. Asa Hutchinson talks during a press conference at the state Capitol in this photo. - Photo by Staton Breidenthal

Gov. Asa Hutchinson said Monday the corruption-tainted General Improvement Fund that state lawmakers controlled is history, but he held out the possibility of using competitive grants administered by the executive branch to help "communities in terms of their unique needs."

The governor's remarks came amid the federal corruption trial of former state Sen. Jon Woods. The Springdale Republican was indicted in March 2017 in a kickback scheme involving General Improvement Fund grants issued in 2013 and 2014. Randell Shelton, a consultant, and Oren Paris III, former president of Ecclesia College in Springdale, also were indicted.

Hutchinson spoke at a lunchtime meeting at the Metroplan Board of Directors' annual retreat, held this year in Hot Springs Village. Taking questions from the audience after his remarks, Hutchinson fielded the last one from Guy Mayor Sammy Higdon.

"GIF grant money -- is there any discussion that it might be put back in effect or is there any way we can figure out how to do it where it don't get squandered?" the mayor asked.

The governor didn't equivocate.

"GIF money is history and is no longer and is not going to happen," Hutchinson said. "Period."

It's been a difficult program to kill. Mike Wilson, a former Democratic 12-term state representative, has sued his former colleagues three times over the way they allocated state funds to the General Improvement Fund, which holds the state's surplus tax revenue and interest income. Each time, Wilson has prevailed.

In the most recent case, the Arkansas Supreme Court ruled in October 2017, that the lawmakers' method of allocating money to the grant program was too vague to satisfy requirements in the Arkansas Constitution that each item of legislative spending be distinctly described.

His 2016 lawsuit challenged the legality of the way lawmakers had come to direct improvement fund monies to support a statewide grant program that is intended to promote economic development.

Wilson previously won a landmark Supreme Court decision barring lawmakers from personally directing how money from the improvement fund is used.

But Hutchinson said the possibility of replacing the General Improvement Fund grants controlled by the Legislature with competitive grants administered by the executive branch is being studied.

"Now, I do believe that there's ways you can have competitive grants that help our communities in terms of their unique needs that's not legislatively directed but that is competitively looked at and awarded," Hutchinson said. "So I think that is something we can continue to talk about and look at because I recognize the need that happens in our communities that you'd like to be able to have the opportunity to apply for grants."

The state already has a program in place that the governor said he sees as a model. In his remarks, Hutchinson referred to it as the Rural Development Grant program, but he actually was referring to the Rural Community Grant program, which is administered by the rural services division of the Arkansas Economic Development Commission.

He also mentioned cities with populations of less than 2,500 were eligible for the grants. Cities with populations of less than 3,000 are actually eligible for the grants, according to the program's website.

Under the program, those cities, as well as unincorporated areas, are eligible for up to $15,000 in matching money. The applicants must provide half of the project's costs as a match, either in in-kind labor, in-kind materials or cash.

The projects included some, but not all, of the same type awarded under the General Improvement Fund program.

"Communities in the past have received funding for baseball/softball fields, community centers, walking tracks, park and playground equipment, pavilions, picnic tables, and library shelving," according to an online summary of the grant program.

"Fire departments have received funding for new fire stations, additional bays for existing stations, turn-out gear, communications equipment, fire trucks, ... extrication equipment and brush trucks."

The deadline to apply for the current funding cycle ended last month. The rural services division will begin accepting applications for the next round in August.

Funding for the program averages around $625,000 a year, according to Brandi Hinkle, the spokesman for the Arkansas Economic Development Commission. The commission awarded 58 grants totaling $622,089.79 in the fiscal year that ended June 30, 2017, she said. That equates to a grant award averaging $10,725.68.

"We have rural development grants that are eligible for cities of less than 2,500," Hutchinson said. "So you have that access to put some more money simply into that to help those cities and then you'd have to create something new if you want to have any kind of grant program that is competitive for cities that would be above 2,500.

"So we're looking at that. But GIF is over."

A Section on 04/17/2018

Print Headline: Community-help cash called doable; But GIF is ‘history,’ Hutchinson says

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  • JMort69
    April 17, 2018 at 8:31 a.m.

    Right, that would be the same executive branch that was in place while these GIF scams were taking place. And, this would be the governor whose nephew is the divorce attorney for Rusty Cranford, the lobbyist at the top of this pile of smelly mess. Is the governor taking any of the blame for sitting by while all this was happening? Or, are any of the other officials in charge of our legislature admitting any lack of oversight? I certainly haven't heard any. This is our tax money. We should have a say in how it is spent. Perhaps a commission including county judges, citizens with financial experience, mayors of these communities and other socially involved people should be included. After all, it is their jurisdictions who benefit. We don't need another bunch of politicians unilaterally deciding how money is spent in our communities. I mean, just look at the Medical Marijuana Commission, another debacle under the governor's supervision. The politicians appointed these commissioners and that has turned in to such a quagmire people may never get the help we need. Clearly, most politicians, especially those who are too inept to handle their personal finances, don't need to be in charge of anything without oversight. They are far more interested in padding their pockets than being good stewards of the people's money. So, no thanks, Governor Hutchinson, let's try something different. The definition of insanity is doing the same thing over and over again and expecting a different result.

  • Whippersnapper
    April 17, 2018 at 10:27 a.m.

    The governor was not in charge of the GIF mess. In the 90s, the governor was in charge of these types of grants, but when Huckabee took office and the Democrats still held supermajorities in the legislature, they took all of the money for themselves and left crumbs for the governor to direct. The problem has been that the 100+ legislators in Arkansas each had control over hundreds of thousands of dollars a year that could be used for any project in their home town, which led to a lot of corruption.

  • JMort69
    April 17, 2018 at 1:46 p.m.

    The governor is the captain of the ship of state, period. And, his bosuns are the heads of the chambers of our legislature, none of whom, apparently, did anything to stop any of the GIF alleged graft. As a long-time independent, I am not going to accept the normal partisan finger pointing in an attempt to excuse this behavior. And, Whipper, what excuse will you make for the governor's nephew having a client like Cranford who is charged with murder-for-hire. I don't think my tax money has the words "Republican" or "Democrat" on it. And, BTW, both are involved in the various schemes this group of alleged crooks have pulled in my state. So, don't try to convince me that the governor has no culpability. Running the state is not all about taking credit, its also about stepping up when you smell something fishy. But, maybe if that stink is too close to home, you cover it up. Sorry, won't work.

  • Whippersnapper
    April 19, 2018 at 9:45 a.m.

    I'm no fan of Hutchinson, I am simply pointing out that the legislature seized control of these funds for themselves (legally) back when Huckabee was governor and the Democrats were scrambling to take away all the powers they had vested in the executive branch. It is independently elected legislators from the various districts (some Democrat and some Republican) who are causing this. Hutchinson has his problems, but GIF is not his problem. For you to assume my insistence on facts is in any way a specific defense of Asa is humorous, to say the least. Just about any commenter on here can tell you that I might be the last true ideological conservative who has never gone for party over principle (which is why I still can't support Trump)

  • Delta123
    April 19, 2018 at 10:44 a.m.

    The Governor's nephew has Rusty Cranford for a divorce client? So what?

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