89th General Assembly - Week 3

This is the first full week of the legislative session even though it was the third overall and it turned out to be quite busy in the Capitol as Governor Beebe announced the largest economic development project in the state's history - a proposed $1.1 billion steel plant in Northeast Arkansas.

The proposed plant is projected to create 2,000 construction jobs for 20-months and 525 permanent, high-wage jobs at the plant, which will be located in Osceola. Recruiting these types of major projects requires a substantial commitment from the state and local entities through incentives. The state will be considering whether to offer $125 million in Amendment 82 bonds to support the project. Amendment 82 refers to the voter-approved addition in 2004 to the state's Constitution that authorizes the state to sell bonds in an amount up to 5% of general revenues to attract a designated "super-project."

The $125 million bond issue will be used to provide a low-interest $50 million loan to the steel plant and pay for $75 million in site preparation and issuance costs. Over the next three weeks, the General Assembly will be reviewing the proposal and will have to determine if the commitment of general revenue to repay the bonds is a good investment of scarce state resources. In approximate terms, if the state issues a 20-year bond issue at current tax exempt rates of 3.5% this equates to a payment of $9 million per year. The private developer will be repaying $50 million so that would like reduce the commitment of general revenues to around $5.2 million per year. This is compared to almost $40 million in annual payroll produced by the plant.

It seems likely that the General Assembly will agree to the bond issue as a means of bringing high-wage jobs to a part of the state that has been struggling with double-digit unemployment over the past few years.

With three weeks in the books, the General Assembly has slowly been filing bills. A typical session sees around 2,500 bills filed with a little more than half actually enacted into law.

Sometimes you can see what is important in a legislative session by comparing how many bills are filed with each committee. The way the state legislature works is that non-budget bills are routed through one of about ten A or B committees. The committees review the bills and recommend passage or issue a do not pass recommendation. Often, making it of committee with a "do pass" recommendation is enough to ensure its passage on the floor.

So what are the committees with the most bills after three weeks?

Public Health - 34 bills

State Agencies - 31 bills
Judiciary - 21 bills
Education - 17 bills
Insurance & Commerce - 7 bills
Transportation - 5 bills
City, County, Local - 5 bills
Agri & Econ Development - 4 bills
Revenue & Tax - 4 bills
Aging, Children & Youth - 3 bills

Public Health is an obvious choice with healthcare representing such an important if not THE important issue of the 89th General Assembly. The committee also reviews topics as diverse as abortion, unemployment insurance and wage law.

State Agencies has a number of bills pending that will change how a state agency like Natural Resources or Alcohol Beverage Control might operate as well as a few voting laws. It is also the committee that can refer up to three constitutional amendments for inclusion on the 2014 general election ballot.

Judiciary often focuses on crime and punishment in the state. There are a number of proposed laws pending that deal with criminal penalties and capital punishment.

Education deals with public and higher education issues and currently has a number of school choice and charter school related bills pending. The choice bills would address the ability of public school students to transfer to a school outside of their home district while the charter school legislation most often seeks methods to increase the number and viability of charter schools as an alternative to traditional public schools.