If you want to know how much state government is spending, where do you look?
In Arkansas, you would have to look through a tedious number of spreadsheets and browse through multiple website layers if you wanted to make a comparison to past years and spending categories. On the other hand, in Tennessee and North Carolina, you could reach for their user-friendly transparency websites.
This is important because it has resulted in "more efficient government administration, more competitive bidding for public projects, and less staff time spent on information requests" according to the U.S. PIRG report, "Following the Money 2018."
Arkansas' transparency website could do with some improvements. According to the Volcker Alliance, a nonprofit whose mission is to empower public servants to govern responsibly, the Natural State was given a "D" for its transparency efforts, despite the existence of the online portal Transparency Arkansas. Arkansas ranked poorly on the Volcker State Budget Report Card because it failed to present all budget materials on a single consolidated website.
Tennessee and North Carolina scored an A and B, respectively. Both Tennessee and North Carolina consolidate their budget dashboards to one centralized state website which displays tax and spending levels across different sectors of the economy. They also demonstrate specific agency and program revenue and spending levels across fiscal years.
They are more user-friendly because they host interactive visualizations that allow government staff, legislators and the public to find answers to their questions quickly without downloading multiple Excel files, which is required to use Transparency Arkansas.
Considering that the Natural State has such an unnaturally low distinction, it is essential to create an open-sourced, publicly accessible consolidated dashboard that would allow the public, legislators, and businesses to easily know how much and where Arkansas is spending taxpayers' dollars. The advantages of being able to pinpoint where fiscal reform needs to happen is paramount to that reform actually happening.
One great example is when North Carolina created its budget transparency portal. As a result of this portal, state procurement staff members were able to consolidate and streamline the procurement process. This allowed North Carolina to leverage its buying power on each procurement contract it entered into after the reform.
The Tennessee Interactive Budget also includes information about levels of state debt and the Tennessee Rainy Day Fund balance by fiscal year. This is of particular importance after Arkansas' last legislative session. Arkansas legislators changed the name, but not the deposit and withdrawal rules, for the state rainy day fund, now known as the Catastrophic Reserve Fund. This surface-level change did nothing to protect Arkansans from potential runaway spending in future legislative sessions.
According to Pew Trusts' Fiscal 50: State Trends and Analysis, every state's reserve-fund balance has surpassed that of the covid-19 induced revenue shortfall as of October 2021. Tennessee's most recent revenue data shows that the state's reserve fund had a balance of $1.5 billion (9.2 percent of state general revenue) as of fiscal year 2021-2022. Likewise, Arkansas' Catastrophic Reserve Fund is projected to have a balance topping $1.2 billion in fiscal year 2022. North Carolina's Rainy Day Fund is also well-stocked.
Transparency dashboards allow this type of information to come to light and could help support initiatives to send that money back to taxpayers when taxpayers see burgeoning state revenues sitting idle.
Multiple states already choose to send back millions in excess revenue each year as part of comprehensive spending reform plans. The best example is Colorado, which adopted the Taxpayer Bill of Rights (TABOR) in 1992. The law mandated that tax revenue in excess of spending caps be returned to Colorado taxpayers in a manner that allows all Coloradoans who paid sales, income, and property taxes to receive a refund from the excess revenue for each tax category.
Considering the benefits that can be realized from a more user-friendly transparency website, Arkansas should consider creating a user-friendly data visualization tool within Transparency Arkansas. This would allow Arkansas' state and local governments to better serve all Arkansans by reducing the time and effort it takes to find and digest budget data.
The real benefits of Web transparency are in the knowledge and insight it gives policymakers, special-interest groups, and the public at large when considering how to make Arkansas a better place to live and work for all Arkansans.
Joseph Johns is a policy analyst at the Arkansas Center for Research in Economics (ACRE) at the University of Central Arkansas in Conway. The views expressed are those of the authors and do not necessarily reflect those of the University of Central Arkansas.