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Governor Outlines His Proposed Highway Program

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LITTLE ROCK – The governor, legislators and private business groups joined to propose a highway program that would add $300 million a year in revenue for the state Transportation Department.

The plan also would add $110 million a year for cities and counties to maintain local roads.

The bulk of the revenue would come from extending permanently the current half-cent sales tax that is dedicated to highway projects. Arkansas voters approved the half-cent tax by a margin of 58 to 42 percent in a 2012 statewide election. It went into effect in 2013 and is scheduled to expire in 2023.

The governor’s highway proposal would allow voters to decide whether to extend the tax permanently. If voters approve the proposal to extend it, the half-cent tax would produce about $206 million a year. That amount would be divided according to the traditional “70-15-15” split of highway money in Arkansas, meaning that the state gets 70 percent while cities and counties each get 15 percent.

The highway proposal includes another $58 million a year from an increase on gasoline and diesel fuel taxes at the wholesale level. The increase would raise the motor fuel tax on gasoline from 21.5 to 24.5 cents a gallon. On diesel, the increase would be from 22.5 to 28.5 cents a gallon. Those are state motor fuel taxes. Motorists also pay federal motor fuel taxes.

The president of the Arkansas Trucking Association was at the presentation of the highway program, which the trucking group supports.

The plan calls for raising almost $2 million from higher registration fees on electric and hybrid vehicles.

The state reported that 802 electric vehicles were registered in January. They would pay an additional $200 in fees. In January 18,777 hybrids were registered and they would pay an additional $100.

The final piece of the revenue plan is to dedicate $35 million in casino taxes to highway projects. Last November, Arkansas voters approved the opening of four casinos.

A competing highway proposal is House Bill 1260, which would transfer funds from the state’s general account to highways when revenue from sales taxes exceed $2.5 billion. It also would add a new wholesale tax on gas and diesel. The bill is in a House committee.

By the deadline for filing proposed constitutional amendments, 46 measures had been submitted by legislators. In each regular session the legislature can refer up to three proposed amendments to voters. Those referred during the 2019 session will be on the general election ballot in November of 2020.

Several proposed amendments would change the process by which citizens’ groups can re-write the Constitution by circulating petitions, gathering signatures and getting their measures placed on statewide ballots.

One proposal would repeal fiscal sessions of the legislature, which are held in even-numbered years. The first fiscal session was in 2010, before which the legislature met in regular session every two years.

Another measure would allow the legislature to limit punitive damages in civil lawsuits, as well as non-economic damages such as damages for pain and suffering.

Several of the proposed amendments are “shells,” meaning that their general topic is listed but the details must be added later.

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