DALLAS – Arkansas Gov. Asa Hutchinson signed a bill raising $50 million for highways Monday, just hours after the measure was approved in a special legislative session.
In a 21-10 vote, the state Senate approved the bill sponsored by Sen. Jimmy Hickey, R-Texarkana. Approval of the funding measure allows the state to receive $200 million in matching federal funds.
Hutchinson, who called the special session to deal with the issue, noted that the bill relies on general fund surpluses and increased investment earnings but does not require a tax increase.
Hickey said his bill is designed to give state lawmakers time to work on developing a longer-term funding plan during the 2017 regular session that begins in January.
Arkansas' current rainy-day fund balance is $30.6 million. A $50 million transfer of surplus funds to the rainy-day fund will come on July 1 under the state's Revenue Stabilization Act, according to the state Department of Finance and Administration.
The state could have a surplus of between $160 million and $185 million in fiscal 2016 based on conservative budgeting and lower-than-expected individual income tax refunds, according to the Bureau of Legislative Research.
Under Hutchinson's plan, a 20-member Highway Commission Review and Advisory Subcommittee of the Legislative Council would review the Highway Commission's proposed rules regarding the criteria for distribution of funds. The subcommittee also would receive progress reports on construction projects costing at least $10 million.
"While we have concerns about the sustainability of some of the proposed funding sources beyond the first year, we appreciate and support the Governor's efforts on this critical, immediate issue," a statement from the state Highway Commission read.
Hutchinson's call for the special session came shortly after lawmakers approved a $5.3 billion budget for the next fiscal year that begins July 1.
The spending plan that mostly follows the budget proposal Hutchinson presented in March, increasing state spending by $142.7 million in fiscal 2017.
The budget includes a $111.9 million increase for the Department of Human Services and a $23.7 million increase for public schools but keeps funding flat for most state agencies.
The budget continues the state's Medicaid expansion program, which has been known as the private option but known as Arkansas Works under the governor's plan to revise it, pending federal approval.
Arkansas carries ratings of AA from Standard & Poor's Global Ratings and Aa1 from Moody's Investors Service.