LITTLE ROCK -- Gov. Asa Hutchinson on Wednesday urged a panel studying Arkansas' highway funding problems to consider all possible options, but he also warned members to think about the "political reality" of finding new money in a state where lawmakers have been wary of tax hikes or tapping general revenue.
Speaking at the inaugural meeting of the 20-member working group he formed to look at the state's highway funding shortfall, the Republican governor said he wanted the panel to look at how other states are paying for their road needs. The working group is set to deliver its recommendations by mid-December.
"Every state is looking at different ways to fund their highways," Hutchinson said. "It does not always involve an immediate new infusion of cash. It could be changing the formula so down the road it results in new infusions of revenue for our highways."
Hutchinson, however, told the panel it needed to come up with recommendations that could find support from the public and the Legislature.
"I also expect you to balance everyone's desire to have a more efficient revenue stream that's reflective of our highway needs, but also balance it with political reality and what we need to do at this day and time, what we can get through, what can get public support," "That's got to be part of the equation."
Hutchinson formed the panel after a highway funding bill he opposed stalled in the state Legislature. The proposal would have gradually transferred tax revenue from car-related items from the state's general fund to highways over a 10-year period. Finance officials said the proposal would have cost the state nearly $35 million in the coming fiscal year and $548 million once fully implemented.
Supporters of the transfer proposal say the move was needed to address the gap between funding and road needs. Arkansas highway officials say they have $20.4 billion in needs over the next decade, but only $3.6 billion in expected revenue from the state and federal government.
Hutchinson said that he wasn't necessarily ruling out any options on highway funding and that he hoped the group would come up with multiple recommendations.
"That's what's nice about starting with a blank sheet of paper," Hutchinson told reporters. "They can be innovative; they can come up with not just one idea, but they can come up with multiple ideas."
Members of the panel said they hoped to first look at how much additional funding would be needed to meet certain, but not all, highway needs in the coming years.
The working group is the latest attempt in recent years to address highway funding. Voters in 2012 approved a half-cent sales tax to pay for highway needs and a year earlier supported renewing a $575 million bond program. Both proposals were recommendations issued in 2010 by a committee formed by the Legislature to study highway funding.
Scott Bennett, director of the state Highway and Transportation Department, said he agreed with the governor that the panel can't ignore the public or the Legislature's sentiment when looking at funding ideas.
"We have to come up with something that is really sellable to the public, or understandable by the public, but it's also passable, so there is that political side of it," Bennett said.
State Desk on 06/25/2015