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Beebe's budget proposal unveiled Thursday, Jan 18, 2007 By Jason Wiest Arkansas News Bureau LITTLE ROCK - Gov. Mike Beebe proposed a two-year, $8.9 billion balanced budget Wednesday that would carve $253 million out of state spending to cut the 6 percent sales tax on groceries in half. Beebe also proposed reducing the tax rate on utility consumption for manufacturers and changing the levy on farm fuel from a sales tax to a per-gallon consumption tax, but the administration said the reductions would not harm funding for essential state services or court-ordered improvements in public school facilities. Legislators generally reacted favorably after reviewing the governor's budget, which proposes increases of $202 million for public schools, $157 million for state colleges and universities, $117 million for human services and $45 million for state prisons over the next two years. "I think we're pretty well in line," House speaker Benny Petrus, D-Stuttgart. "Looks like a pretty good budget." The administration did not disclose its plans for spending from a projected $843 million budget surplus in its presentation to the Joint Budget Committee. The governor said he was awaiting cost estimates for renovating public school buildings and equipment. Previous estimates ranged from $250 million, but the governor and legislative leaders have said they expect the state to spend much more. The governor's budget measure includes $8.9 million over two years toward a superproject bond payment fund. Beebe said he thought the state was in "serious competition" for major projects but declined to give details. About $219.2 million of the $319.9 million in proposed tax cuts would come from general revenue used to run state government. The rest would come from special revenue, including education trust funds, the property tax relief trust fund and the state central services fund. Overall, Beebe's plan calls for $4.36 billion in state spending in fiscal 2008, a 7.5 percent increase, and $4.54 billion in fiscal 2009, a 4 percent increase. "Education is our top priority," Beebe told reporters later Wednesday. Public school funding would increase by 8 percent next fiscal year and another 2 percent the year after under Beebe's budget. The increases would include the additional $19 million the governor has proposed for minimum state aid allocated to schools on a per-student basis, and a $40 million expansion of preschool. The budget also includes additional funding for English as a second language programs and extra funding for fast-growing school districts. It would increase funding for higher education by $64 million, or 10 percent, in fiscal 2008 and 28 million, or 4 percent, for fiscal 2009. "The biggest change and the biggest way that we were able to balance the budget is the governor recommended 10 percent growth for the colleges and universities," instead of the 17 percent increase former Gov. Mike Huckabee recommended, said Richard Weiss, director of the state Department of Finance and Administration. Weiss presented the budget to the committee. The difference amounted to about $142.6 million, he said. Beebe also proposed a $14 million boost for state police, some of which would be used to hire additional state troopers. "They've been needing that for some time," said Senate president pro tem Jack Critcher, D-Batesville. The Department of Correction would get a nearly $45 million increase, enough to pay for 200 more women's beds and help phase in a long-planned Special Needs Unit at Malvern. The Department of Community Correction would get a two-year increase of $29 million to add 60 probation officers. Beebe's budget proposal also insures funding for the state Medicaid program, through a 2 percent increase in state Department of Health and Human Services funding for the first year and 6.9 percent in the second year of the biennium. "We are spending some of the Medicaid trust fund money but ... it's built up to the point where we ought to be spending it on people," Beebe said. The trust fund is a reserve fund made up from proceeds on a tax on soft drinks. Sen. Shane Broadway, D-Bryant, said he liked what he saw in the governor's budget. "I thought the numbers looked pretty good," Broadway said. "(The budget) was very well thought out in the short amount of time they had to put one together. "It just shows the knowledge base that's there between the governor and Weiss, too." Beebe was a state senator for 20 years before being elected attorney general in 2002. |
