House approves taking tobacco lawsuit money for state reserve fund | Arkansas Blog

Wednesday, May 3, 2017

House approves taking tobacco lawsuit money for state reserve fund

Posted By on Wed, May 3, 2017 at 10:10 AM

There was spirited debate in the House of Representatives this morning on the bill to take $105 million from the fund created by payments on the tobacco settlement lawsuit and put it in a state reserve fund. It passed 70-24, with four voting present. It needed 67 votes for passage because it changes a voter-approved initiated act.

The governor wants the money to improve the state's bond rating. It could be tapped now for any purpose, with a two-thirds vote of the Legislative Council. Supporters insist there was no plan for the governor to use the money for anyhing else.

Democrats emphasized the bill overrides a voter-approved act on spending the tobacco lawsuit money that specifies it must go only for health care. This "subverts" the will of the voters, Rep. Deborah Ferguson said, so the legislature can "raid" the money for shortfalls.

Republican Rep. Kim Hendren asked what would prevent the money from being tapped soon for highway needs. He noted a plan passed by an earlier legislature to devote surplus money to highway construction had to be redone because there is no surplus this year.

Democrat-turned-Republican Rep. Joe Jett defended the bill as a long-term savings account and defended the Legislative Council, the governing body between sessions, as a responsible controller of the fund.

The bill required a two-thirds vote because it changes an initiated act. Several Republicans, from the conservative end of the spectrum, joined a group of  Democrats in opposing the legislation.

This action completed approval of Gov. Asa Hutchinson's legislative agenda, primarily to adopt changes in the Medicaid expansion to make 60,000 currently covered inelgible with a lower income cap for participation. It will also allow work requirements for Medicaid coverage.

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