Bill honors voters' intent
The Arkansas House and Senate passed a bill that allows counties with dedicated sales and use tax funds to appropriate up to 95 percent of anticipated revenues, instead of the former maximum of 90 percent.
House Bill 1228 was sent to the governor's office Monday for final approval.
The appropriations in excess of 90 percent must be made and spent only for the dedicated, specific purpose of the tax. This does not apply to dedicated revenues that have been pledged for bonds and does not include general sales and use tax revenues.
In 2000, Faulkner County voters passed a half-cent sales tax, with half those funds going to the jail and half to the county's roads. House Bill 1228's author, state Rep. Robbie Wills of Conway, said he wanted to make sure voters in counties such as Faulkner County are able to spend the dedicated tax revenues so they can get what they want out of those taxes.
"This is hopefully an opportunity for counties to fully use the dedicated sales tax revenue. When voters approved the sales tax, they intended to use it for a specific purpose," he said. "This allows counties the maximum use of those dedicated use revenues and honor the intent of the voters."
As a former Faulkner County Justice of the Peace, Wills said he knows the Quorum Court will probably not take advantage of the bill immediately if it becomes a law. The bill, however, puts the option there if the county needs it, Wills said.
"I don't know if they will ever need to use it. I hope they don't, but if they do need to, then the option is there," Wills said. "That's what I intended to do, so that if something needs to be done, it will be done at the Quorum Court and not at the state level. I'm happy with the result."
Dianna Kellar, chair of the Quorum Court's finance and administration committee, said the county is doing fine with its current system. The Quorum Court appropriates up to 88 percent of anticipated revenues and has done so for several years.
"I don't anticipate us doing that. It just cuts us too short on our reserves," Kellar said. "I think the sales tax is doing well ... but it would be up to the entire committee."
Three amendments were added to the bill before it was passed by the House and Senate, two in the Senate and one in the House.
The first amendment in the House added a section stating the bill would be effective for counties which had sales and use tax revenues that have been dedicated for a specific purpose and said quorum courts may appropriate more than 90 percent of anticipated revenues.
The first amendment in the Senate was a small substitution in wording concerning anticipated revenues, adding the phrase "from the dedicated sales and use tax."
The second amendment in the Senate added a line stating quorum courts could appropriate up to 95 percent of anticipated revenues and included a small change in wording in another section.
Wills said the amendments satisfied the concerns of the Association of Arkansas Counties. The AAC was concerned with the original form of the bill, which would have allowed counties to appropriate more than 90 percent of its general funds, which would leave many counties in a bind until property taxes came in between the months of March and October.
(Staff Writer Jennifer Thomason can be reached by e-mail at jennifer.thomason@thecabin.net or by phone at 505-1266.)