UPDATE: Tax correction bill, but rest of legislation speedily approved | Arkansas Blog

Friday, October 18, 2013

UPDATE: Tax correction bill, but rest of legislation speedily approved

Posted By on Fri, Oct 18, 2013 at 1:24 PM

BRUCE WESTERMAN: He's stretching truth to preserve money for his home school district, against interest of entire state.
  • BRUCE WESTERMAN: He's stretching truth to preserve money for his home school district, against interest of entire state.
The special session is underway with a significant wrinkle.

A furious Tea Party lobbying campaign (Tea Party used here as a handy synonym for the extremist wing of the Republican Party) got a bill to re-establish the intended use of the 25-mill base school property tax charge led to a tabling of the Beebe administration's bill to do it in the House Education Committee this morning.

The 25-mill mandatory property tax, whatever it produces in each school district, is supposed to go into the state pot for foundation aid. Eight tiny school districts — significantly including Tea Party Rep. Bruce "30 Pieces of Silver" Westerman's Fountain Lake district — are tiny in enrollment but large in property wealth. (Fountain Lake has a big chunk of retirement village property.) So the base millage produces more than the $6,300 in foundation aid paid for each student statewide. The little districts want to keep the excess — plus continue to take other categorical funding. It flies in the face of the equity intended by design of the amendment and laws written to implement the Lakeview school finance decision. But in a 4-3 decision, the Supreme Court said if the legislature wanted to keep that overage, it had to say so explicitly. The state still argues against that decision, but is trying to capture the excess, about $8 million statewide, as part of a package of bills offered to bail out the school health insurance plan.

A handful of right-wingers are arguing this is wealth redistribution. It is NOT redistribution — Beebe has sharply noted that immense tax revenues in Pulaski County are shared with the state at large to the significant benefit of places like Fountain Lake. As Chief Justice Hannah noted in his dissent, this interpretation opens the way for a supremely rich school district (a tiny one with a giant power plant for example) to  have a fortune in funding against other districts. That isn't equity.

Westerman is also either lying or willfully ignorant. He's arguing the overage the state wants won't go to schools. While it's not a specific part of the insurance bailout package, it does go to shore up the school construction fund, one of several moving parts in the equation that benefits all schools.

For now, the Tea Party minority is in the lead. The bill came out of Senate committee yesterday and has majority Senate sponsorship, but the Senate won't take it up if it is blocked in the House. The Senate otherwise passed everything else without incident and went in recess pending further news from the House.

As it stands now, the Beebe administration is trying to get enough votes to take the bill off the table in committee. That takes a majority of a quorum. It will take 11 votes to get the bill out of committee if a roll call is held, which seems likely given the pitched opposition.

The original vote to table was 10-8 with two (Biviano and Dale) not voting. Two Democrats — John Catlett and Brent Talley — joined eight Republicans to table. Committee Vice Chair Ann Clemmer, whose Bryant district gets a significant bailout on this legislative package and which can use facility money, continues to disappoint as a full-blooded 'bagger after early days as what passed as a moderate Republican. Might as well vote for Gatorbait next year for all the difference it'll do to vote otherwise.

UPDATE: House Education met at 1 p.m, but the Beebe administration couldn't round up the necessary votes to bring the tax bill off the table. There was no debate before the vote, just perfunctory approval of other bills in the special session package. One Democrat, John Catlett, hung with the Republican opposition to provide enough votes to defeat an effort to revive the bill. Absent from the vote were Clemmer, Talley and Republican Les Carnine and Democrat Charles Armstrong. The last two earlier opposed tabling the bill.

The bill is dead for the session. Beebe says it undermines the Lakeview decision (as three justices have already said) and opens the state to challenge from other districts. But there will be other sessions.

Otherwise, the insurance "fix" is done. The House and Senate will meet at 12:01 a.m. tomorrow morning so that the statutory three-day consideration can occur before final passage. All should be tied up neatly tomorrow except for the needed fix on the tax windfall for property rich tiny school districts.

Rep. Jim Nickels got a hearing on his bill to have a unified health insurance program for all public employees, local and state. It's an idea worth a look. It was sent to a task force studying broad reorganization of insurance.

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