Gov. Jim Guy Tucker led a cheering section of political candidates who endorsed the need for a major highway construction program. Now comes the hard part — persuading the legislature to raise taxes.
My crystal ball says it would be risky to predict the legislature will produce a major highway program in 1995. There’s simply no significant sentiment for the necessary raid on general revenues.
The unknown is Tucker, who is currently leading from the rear. For now, he intends to let a coalition of the Highway Commission and the Arkansas State Chamber of Commerce hold public meetings around the state to identify local needs. Whatever consensus that emerges from these meetings still won’t be enough without bold leadership from the governor.
Most of the tax options will require extraordinary three-fourth votes in the legislature. Will Tucker, already branded a tax-and-spender, charge out front against such odds for tax increases that could run into the hundreds of millions of dollars?
Expectations are huge. Tucker has all but promised a vigorous push to four-lane all of Highway 71 along the western edge of Arkansas and Highway 412 along the northern tier. These projects alone could cost $3 billion dollars; $4 billion counting interest.
To retire a bond issue that size would take every bit of: 1) a new one-cent general sales tax dedicated to highways (producing $265 million annually); 2) removal of the current sales tax exemption on fuel sales ($79 million); and 3) a two-cent increase in the 18.7-cent per gallon fuel tax ($32 million, a third of which goes to local government).
This is a mouthful when you consider the 1991 highway program managed only a two-cent fuel tax increase, and then only after a fierce 11th-hour lobbying campaign. The amount, in short, is very nearly prohibitive. Education, law enforcement and local governments would howl if the Highway Commission put in a claim for that much dedicated revenue.
Parochialism is another obstacle. The Highway Commission couldn’t propose a program devoted entirely to western and northern Arkansas, not when people in Northeast and Southeast Arkansas have been waiting for four-lane projects for decades. And not when 29 new legislators will take seats in January, each hoping to bring home a slice of highway pie. (Ironically, most of them ran on no-new-tax pledges.)
Many highway advocates would be overjoyed if they could simply win an ancient goal — removing the sales tax exemption on fuel sales, with proceeds earmarked for highways. That would produce enough, I’m told, to finish the 1991 highway program in five or six years, rather than 11. It wouldn’t pay for any new four-lane projects, but modest as this might seem, it would be a huge victory.
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Ernest Dumas, who's been covering Arkansas governors for five decades, provides historical context for the $100 million income tax cut that new Gov. Asa Hutchinson seems certain to push through a friendly legislature in the opening days of the 2015 legislative session. History repeats, Dumas writes. /more/
Gov. Mike Beebe has appointed Frank Scott Jr., a Little Rock banker and former member of the governor's staff, to fill out the state Highway Commission term of John Burkhalter, who resigned to run for lieutenant governor. /more/
Good news yesterday from the Arkansas Department of Human Services. The program ended the budget year June 30 with a $62 million cushion in the Medicaid trust fund thanks to the slowest growth of spending in the program in years. /more/