LITTLE ROCK — In a year in which Republicans are running on promises of cutting taxes and government spending, Arkansans will vote in November on a tax increase proposed by a Republican lawmaker from the most conservative corner of the state.
The temporary half-cent sales tax to fund $1.8 billion in highway bonds is one of two initiatives certain to be on the Nov. 6 general election ballot. Four initiatives that the attorney general’s office certified and supporters gathered signatures for face long odds for making the ballot.
Highway construction under the plan would focus primarily on creating a statewide four-lane grid and adding capacity to existing four-lane highways.
The sponsor of the tax proposal is Rep. Jonathan Barnett, R-Springdale, a former state highway commission chairman who is serving his second legislative term. He is unopposed for re-election this fall in Northwest Arkansas, where some current and former Republican legislators lost GOP primary races to newcomers promising to cut taxes and the size of government.
Barnett, who refused to sign a no-tax pledge pushed by the conservative group Americans For Prosperity, said last week he thinks his highway proposal has good chance of passing and that a number of his fellow Republicans, who did sign the no-tax pledge, will privately support his proposed constitutional amendment.
Supporting a tax increase “scares a lot of people,” Barnett said.
“They don’t want to talk about it because they’re scared of what some (voters) would do,” he said, noting what happened to former Rep. Rick Green of Van Buren, Rep. Tim Summers of Bentonville and Sen. Bill Pritchard of Elkins.
Green and Summers lost GOP primary races for the state Senate in May after both drew criticism from primary opponents and AFP for refusing to pledge not to raise taxes if elected. if elected.
Pritchard, who signed the tax pledge, came under fire for his 2009 vote for legislation to impose a milk wholesalers fee of 30 cents per 12 gallons of milk to subsidize dairy farmers. The bill never became law because Gov. Mike Beebe proposed an alternative funding source that did not involve fees.
“People say, yes, we want (the $1.8 billion highway program), but then they say, well you need to pay for it some other way with efficiencies in state government,” Barnett said. “We’ll, there’s no other to pay for this, that’s just it.”
He said the current highway funding system, which depends on increasingly flat fuel tax revenues to pay for road projects, is inadequate. Highway officials have estimated nearly $20 billion in highway needs over the next decade and anticipate revenue of about $4 billion.
“This is not a government regulation,” Barnett said about the tax hike and $1.8 billion bond program. “This is not government trying to take over our lives. This is not creating bigger government. It’s a private sector job creation bill.”
Barnett said he managed to avoid a challenger, despite sponsoring the tax hike proposal, because of his background as a self-employed building contractor and 10 years on the Arkansas Highway Commission.
“I think they gave me a pass,” he said. “I think that even though a lot of people disagree with me, including Republicans — some, not all — I think they respect me. I think there is a certain amount of credibility there because of my background and my experience.”
Scott Bennett, director of the Arkansas Highway and Transportation Department, said recently the half-cent sales tax increase, which would sunset in 10 years under the proposed amendment, could generate more than 40,000 jobs and fund a number of large expensive projects across Arkansas, such as the replacement of the Interstate 30 bridge over the Arkansas River between Little Rock and North Little Rock, widening I-40 between Little Rock and Conway, and widening U.S. 67-167 between Jacksonville and Cabot.
Two lanes of the proposed Bella Vista bypass also could be completed in Northwest Arkansas, and in the south, U.S. 82 between Magnolia and El Dorado could be widened, along with a number of other heavily traveled highways across the state, he said.
“If the general public knows what they are voting on, and they see the good that comes out of it, then you know maybe we’ll have a highway program,” Barnett said.
Craig Douglass, spokesman for Move Arkansas Forward, the group pushing the proposed constitutional amendment, said last week he expects the television advertising campaign for the proposal to begin in October. Supporters have raise about $300,0000 toward their goal of $1 million for the campaign.
Douglass said the proposal has a chance with voters, even in the current political environment, because of several key positive indicators.
“We think we have a good foundation on which to build our campaign and to promote the key messages and benefits to all Arkansans, so we feel good about that,” Douglass, adding that the tax will not affect groceries, medicine or gasoline.
The likelihood that none of the citizen-led ballot initiatives will make the ballot also could enhance prospects for the highway proposal, he said.
The secretary of state’s office has rejected one proposal because supporters failed to follow collection rules. Three others failed to get enough verified signatures, though supporters for each have been given an additional time to make up deficiencies.
“The cleaner the ballot, the better for us,” Douglass said. “The fewer issues on the ballot, quite frankly, the better because it will focus the voters attention on this key issue.”
The only other proposal on the ballot so far would authorize cities and counties to create special economic districts and issue bonds for retail projects.
The measure, sponsored by Sen. Jake Files, R-Fort Smith, during the 2011 session and recommended for the Nov. 6 general election by the Legislature, also allow the additional revenues generated by the new development to be used to pay off the bonds.
A recent poll by Talk Business and Hendrix College found 42 percent of Arkansans said they would vote for the tax increase, 49.5 percent said no, and 8.5 percent said they did not know. A similar poll in March had 41.5 percent supporting the sales tax and 50.5 percent opposing it. The remaining 8 percent said they did not know.
“Any time you can begin a campaign and you are starting off with upwards of 40 percent approval of the issue that we have not been communicating with the voters about, I feel very good about that,” he said. “We think that is a good foundation.”
Between now and October, when the statewide television campaign begins, Douglass said Highway Commission Chairman Madison Murphy and others will be traveling the state speaking to local civil groups about the importance of the tax hike.
The state highway director also will be speaking at civic events but he will not be asking for donations for the campaign, Douglass said.
“I hope people of the state understand how importance of this one-half cent,” Commissioner Dick Trammell of Rogers said during last week’s Highway Commission meeting. “This is a great investment for the state of Arkansas.”