From the historic hallways of the most beautiful state Capitol in our nation, this is Senator Keith Ingram.
The legislature is holding budget hearings this week, in preparation for the 2023 regular session.
Setting the state’s fiscal policy is the most important duty of the legislature, and its most time consuming.
We’ll adopt a yearly budget that calls for spending about $6 billion in general revenue funds. The lion’s share will be spent on education, health care services and prisons.
Arkansas has always adopted very conservative budgets. Also, we operate under a balanced budget law, something I really wish the federal government would do.
In spite of our very conservative budgeting, the state’s general revenue fund grows almost every next year because of growth in the economy.
For example, this year’s budget is about $175 million more than it was the previous fiscal year, in spite of tax cuts.
That speaks well of the overall health of our business climate.
Even when tax rates remain the same, if the economy grows it will increase the amount of sales and income taxes collected by the state.
As I mentioned earlier, schools, health care and prisons probably will receive the bulk of next year’s revenue growth.
Highway construction is considered in a different category, because it is funded from special revenues such as motor fuels taxes and fees on heavy trucks.
When you fill up your car or truck, the diesel and gas taxes are dedicated specifically for highway projects.
The legislature will approve pay raises for school teachers, the question is how much.
The House Education Committee voted to recommend teacher raises of $4,000 a year, but the Senate committee did not go along with that recommendation.
The Senate chairman wants to structure pay raises so that teachers will get bigger pay increases if they are certified in high demand subjects like physics, math and science.
Fortunately, the legislature has built up reserve funds over the past few years. Our catastrophic reserve fund is more than $1.2 billion and the state’s general allotment reserve fund is more than $1.3 billion.
Maintaining a strong rainy day fund boosts the state’s credit rating. It also ensures that Arkansas will have the necessary matching funds to qualify for as much federal highway funding as possible.
Under the Constitution, the legislature has the power of the purse strings. During budget hearings, you can see how seriously we take this duty, as lawmakers question every detail of state spending requests.
From the Capitol, it is always my great honor and sincere privilege to serve you as your state Senator. This is Keith Ingram.