Wednesday, March 4, 2015

Federal Programs Adopted by Arkansas: The Good The Bad and The Ugly

by David Ferguson, Conduit for Action: There is no doubt that Arkansas has been able to do a lot of great things for its citizens because of the availability of federal funds.

On the other hand, there is a pattern of strings being attached to the funds. Concerns about adopting new federal supported programs and the policy implications of the program tend to be drowned out by bureaucratic praise that sounds a lot like a J.G. Wentworth commercial, “It’s my money and I need it now!”

What the federal government cannot take over through the “Commerce Clause” and tax policy, they try to accomplish though the carrot and stick of federal funds for states.

While Arkansas changes its policies to chase federal funds, are we overlooking other needs that would be a priority but for the chase for federal funds?

After states accept and begin to depend on federal funds, the federal government has a habit of changing the rules by requiring more state matching funds or imposing additional programs or requirements that must be adhered to in order to continue receiving funds.

A less obvious cost is the cost on Arkansas’ citizens. When Arkansas changes laws and policies merely to get federal funds, those changes aren’t made in a vacuum; they affect our citizens. New mandates cost individuals, businesses, the state, and local governments as everyone is forced to comply. It is not just a financial cost but sometimes a loss of liberty.

Arkansas state budgets are passed and programs altered without much discussion of what is gained and what is lost by accepting the funds.

When it comes to the federal programs, Arkansas wants it Congressional delegation to curb spending and to reduce federal interference. Meanwhile, the state officials and bureaucrats are heard saying of federal funds, “It’s my money and I need it now!”


It is well past time for the state to do a biennial comprehensive review of all state programs receiving federal funds. Questions I would want answered include:
  • What are the benefits of the programs that we can celebrate?

  • How well does the program meet its goal?

  • How much federal money does the state receive for the program?

  • How much State money goes to meet a federal match or to support the program?

  • What changes in state policy, laws, and regulations were required in order to receive the funds?

  • What mandates have been imposed on our citizens?

  • What are Arkansans saying about the program and its restrictions, both praises and criticisms?
Is it worthwhile to do such a review? Yes. First, our citizens deserve to know both how the federal programs have benefited Arkansans and how federal intrusion has changed and controlled state government. Second, our politicians need to have a better picture of how much (or little) of the state budget they have control over without running afoul of federal programs. Third, such a study could put a national spotlight on the federal takeover of state policy. It was once said that the states may serve as laboratories to try novel social and economic experiments, but increasingly the federal government control those laboratories and control the results. Fourth, such a study could, if not ignored, help conservatives in Congress develop policies to assist states without including restrictions designed to control state policy.

One concern for conservatives is the huge federal debt and the possibility that the federal government will require states to take on bigger and bigger financial matches in the future.

Again, federal funds make it possible for Arkansas to provide many needed programs. But, don’t you think we should know more about the federal funding so that Arkansas can make better informed decisions?


Over one third (1/3) of the 2014 revenues in Arkansas’ budget come from federal funds.[i]

The following 2014 chart doesn’t mention Federal funds and instead refers to “inter-governmental.” The state brochure goes on to describe “inter-governmental” as “predominately federal revenue used to fund federally mandated programs or to support federal grants.” The total revenue cited is $19.6 billion. Therefore the inter-governmental portion would be about $6.66 billion.

What the chart does not show is how much of the remaining state revenue goes to support federal programs as matching funds and other costs.


When you think about state agencies that rely on federal funds, the first two to come to mind may be the Department of Human Services and the State Highway & Transportation Department, but there are many more. The following are agencies identified by a researcher from some state budget documents from 2012[ii] but this is not a complete list. (For example, the State Highway & Transportation Department, is not in this list.)

Administrative Office of the Courts
Aeronautics Department
Agriculture Department
Attorney General
Career Education
Child Abuse & Neglect
Community Corrections
Crime Information Center
Crime Laboratory
Finance and Administration
Human Services
Disability Determination for Social Security
Economic Development
Educational Television
Emergency Management
Environmental Quality
Forestry Commission
Geological Survey
Health Services Agency
Heritage Department
Higher Education Department
Labor Department
Military Department
National Resources Commission
Parks & Tourism
Public Service Commission
School for the Blind
School for the Deaf
Science & Technology Authority
Secretary of State
Spinal Cord Commission
State Library
State Police
Tobacco Control Board
Veterans Affairs
Workforce Services Department

. . . . [Read Relevant Examples of Federal Program Adopted & Intrusion]] . . . .

If the federal government’s goal was actually to help states and not to control state policy, it could shift its financial support of multiple programs into just a few areas, thereby, reducing or eliminating state fund matching in those areas and freeing up state funds for other areas. For example, I wish the feds would use the money they now “give” us (or “give back” to us) for education standards and programs and instead shift it toward funds that would reduce state Medicaid matching– which in turn would free up Arkansas’ funds so that Arkansas could be responsible for its own education funding and education policies. There is not much chance of that happening because controlling state policy is too attractive to the federal government.

In the meantime, don’t we owe it to our citizens to find out the real cost for our dependence on federal funds, and not just the alleged benefits of the federal-state programs?

. . . [Footnotes in original Article]

Tags: Arkansas, Federal Programs Adopted, Good, Bad, Ugly,  Conduit for Action,  To share or post to your site, click on "Post Link". This site is an Outreach of the ARRA News Service.

No comments: