565 items on state wish list; $172 million in surplus kitty

The governor and lawmakers identified more than $1.7 billion in special surplus-funded projects this legislative session that they’d like to see done in fiscal 2014, although a lot of those 565 projects won’t be funded because there is only $172 million in surplus cash to spend.

Surplus money is any that comes in above what is budgeted. That money is placed in the state General Improvement Fund, which can then be spent on projects that are near and dear to the governor and/or legislators.

The 2013 legislative session ended Tuesday after 100 days. Before adjourning, lawmakers approved a bill that allows them to spend $70 million in surplus funds and Gov. Mike Beebe to spend the remaining $102 million.

For decades, the General Assembly allotted shares of surplus money to legislators to spend on specific projects in their districts. That money was used for such things as sports halls of fame, fire departments, rodeos, city side-walks and chambers of commerce in specific localities.

In 2006, the state Supreme Court ruled that that practice violated Amendment 14 of the state constitution, which forbids “local and special” legislation.

Since then, lawmakers have distributed the money more generally. For example, money is earmarked for things like fire stations or senior citizen centers statewide, and local entities apply to receive a share of the money for their specific fire stations or senior citizens centers.

From year to year, the amount of surplus money varies, depending on the economy, tax collections and state budgeting needs.

In 2011, legislators divided $50 million. In 2009, about $100 million of the $355 million surplus went to shore up the state’s general revenue budget. Then, Beebe was allotted $113 million, and the Legislature received $70 million.

Act 1519 of 2013 allocates a total of $300 million that is in the General Improvement Fund. It assures funding for 26 projects and programs. Any money remaining after that 26 are funded can be usedfor projects identified by the executive and legislative branches, said Senate Chairman of the Joint Budget Committee Larry Teague, D-Nashville.

Among funding for the 26 projects is $107.7 million to help shore up the state’s Medicaid program, $13 million for lease payments on Department of Correction facilities, and more than $30 million for the state’s two-year and fouryear colleges and universities.

The amount of money taken “off the top was just a general consensus,” he said.

He said legislators were told early in the session that they’d need to use some surplus money to address a shortfall in the state’s $5 billion Medicaid program. “We were committed to that from the get-go,” he said.

Funding earmarked for higher-education projects includes $3.5 million each for Cossatot Community College of the University of Arkansas and the University of Arkansas Community College at Hope; and $3 million each for Arkansas Tech University, Arkansas State University, the University of Arkansas at Fayetteville, the University of Arkansas at Little Rock and the University of Central Arkansas.

Once those 26 projects are funded, surplus money is divided with 59.3 percent going to projects selected by the governor and 40.7 percent to projects decided on by the Legislature. This year, the House and Senate each identified $35 million in projects.

Beebe put $1.247 billion in projects on his surplus-funds wish list, but he has only $102 million to spend. So he will have to decide what will actually be funded.

Beebe spokesman MattDeCample said that’s not unusual.

“That always seems to have been the process, that you always have far more appropriations approved by the Legislature than you have funding,” DeCample said. “Hopefully, it’s always been well understood that we only have a fraction of funding to fill those appropriations.”

As surplus dollars trickle into the General Improvement Fund, the governor chooses which of the more than 300 projects on his wish list will be funded. The wish list for fiscal 2014 includes more than $50 million for maintenance and repairs in the Agriculture Department; $400,000 for a Department of Human Services treatment program for abused women; and $989,622 for the secretary of state to paint the interior of the Capitol dome. Others are $9.2 million for new vehiclesfor the Arkansas State Police; $1.3 million to renovate the music building on the University of Arkansas at Monticello campus; and $1.8 million for the Arkansas Heritage Department’s Mosaic Templars Center to purchase land and a building at 906 Broadway in Little Rock.

DeCample said it isn’t yet clear which state projects will get funded.

“Some we already know are priorities of his,” DeCample said of the governor.

DeCample pointed to three: $50 million for the governor’s quick-action closing fund, $20 million to pay for bonds for a steel mill in Osceola and $7 million to reward high-performing schools. Those amounts are the maximums. Beebe could choose to spend less.

The quick-action closing fund can be used by the governor to lure businesses to the state or to encourage businesses to stay, without having to call the Legislature back into session to vote on it.

This session, the Legislature authorized a $125 million bond issue for the $1.1 billion Big River Steel project inMississippi County near Osceola. The $20 million on Beebe’s priority list would be the f irst payment on those bonds.

DeCample wouldn’tspecify what other projects may get funded, but said “the governor’s philosophy has always been that a primary goal for [General Improvement] funds is for capital needs around the state.”

Also on the list of 26 offthe-top projects is $3.75 million for a veterans home. Legislators want to spend an additional $3.75 million - the largest share of their $70 million in identified projects - to purchase land for the veterans home and to help construct it.

The legislators’ list alsoincludes $97,500 to renovate the Future Farmers of America summer camp, Camp Couchdale, near Hot Springs; $10,000 to test natural-gas-fueled school buses; $40,000 for the Arkansas Boys and Girls Club; and $125,000 for grants to help operate and construct county fairs.

Among the higher-education projects that may receive funding are an additional 280 university projects identified by the Legislature and governor.

Of those, 61 would be funded with the Legislature’s share of surplus funds.

The higher-education projects include about $3.5 million for infrastructure and maintenance at East Arkansas Community College, $2.65 million for an aviation annex at Mid-South Community College in West Memphis, $200,000 for vehicles at North Arkansas College in Harrison, $100,000 for rice research in Stuttgart for the University of Arkansas at Fayetteville, and $225,000 for scholarships and renovations at the Clinton School of Public Service in Little Rock.