Several Democratic state lawmakers say they oppose any tinkering with the traditional formula used to distribute state dollars for road construction.
The House Democratic Caucus formally asked the governor to retain the formula as he studies how to raise any new money for road construction in the upcoming regular legislative session, which begins in January.
The Arkansas Highway and Transportation Department gets 70 percent of every state dollar raised for highway construction. Cities and counties split the remaining 30 percent, based on population.
A group appointed by the governor to develop options to raise more money for highways has suggested altering that formula.
"County and city governments, especially our rural ones, are already financially struggling to maintain roads and structurally deficient or functionally obsolete bridges," according to a letter outlining the Democratic Caucus opposition to altering the formula. "Lowering the amount of state revenue counties and cities receive would be detrimental to the overall well-being of infrastructure in Arkansas."
The House minority leader, state Rep. Michael John Gray, D-Augusta, submitted the letter to Hutchinson on behalf of the caucus, which represents the 35 Democratic representatives in the House.
Representatives of cities and counties also oppose eliminating the formula on any new money raised for highways.
Altering the funding formula is one of about 20 recommendations made by the Governor's Working Group on Highway Finance to raise about $110 million annually to provide a short-term boost for state highway funding. Under the traditional split, the short-term target grows to about $160 million annually when money for cities and counties are counted.
The recommendations include an increase in the state taxes on fuel, shifts of existing revenue from other parts of the budget to highways, or transfers of general revenue raised over several years from the sales tax on new and used vehicles. The working group said it was submitting options from which the governor can choose.
The Highway Department said it would use its share of new money to help it match any new federal money that is distributed to the state and to restart an overlay program in which asphalt is put down to extend the life of the road before it needs a total reconstruction.
The overlay program costs about $200,000 per mile, which is more economical than total reconstruction, which costs about $1.5 million a mile.
The counties' and cities' share of the money under the traditional split is distributed to individual counties and cities based on population.
One idea would be to direct any new money for cities and counties distributed under the formula, which are called turnback funds, to go into city and county state aid programs. Under those programs, cities and counties submit highway and street project proposals.
In the case of counties, the proposals are submitted to the department's county state aid office. For cities, their proposals are submitted to the State Aid Street Committee, composed of mayors from around the state and independent of the department.
Another idea would be to have turnback money subject to annual reporting requirements. Cities and counties are under no obligation to report how they spend the money now.
A third idea contained in the draft recommendations is to require counties to raise the county property tax of 3 mills, the maximum amount of property taxes that can be spent on county roads, before they can share in any new turnback money. Members of the working group said exceptions should be made for counties which devote sales tax revenue to road construction.
In a separate statement accompanying the release of the letter, state Rep. David Hillman, D-Almyra, a member of the House Public Transportation Committee, said the traditional 70-percent/30-percent split for state highway revenue has been "fair to everyone."
"Whatever we do to find more money for Arkansas' transportation system needs to be shared on the same basis as it has in the past," he said. "The transportation needs in Arkansas are more than just those of the state highway system, they are also those of our counties and cities -- all of which are necessary for the adequate and safe roadways that our citizens deserve."
Metro on 11/24/2015