Friday, May 27, 2016

How a 1997 Power Grab Is Costing Arkansas Taxpayers Millions On Pet Projects

by Conduit for Action: The 1997 session of the Arkansas legislature has been called “Grab Fest.” The media primarily remembers Grab Fest for legislation passed to financially benefit some legislators enrich themselves from a $3 million program to provide lawyers for children involved in custody disputes. A number of Arkansas legislators were indicted or investigated and some went to prison.

But Grab Fest was bigger than just that scheme. Grab Fest describes the whole 1997 session in which Democrat legislative leaders sought to gain budget control against a Republican Governor who had not been elected to that position by the people.

On July 15, 1996, Lieutenant Governor Mike Huckabee became Governor after Governor Jim Guy Tucker resigned due to a criminal conviction. Huckabee faced a state legislature that was overwhelmingly Democrat and many of his agency heads were still holdovers from the Tucker administration.

Legislative leaders knew the budget better than Huckabee and knew many agency heads better than Huckabee. Legislators seized the opportunity to take control of the state budget. Taxpayers are still paying dearly for Grab Fest because of the grab of power over the General Improvement Fund (GIF) which was primarily used for one time expenditures for state agencies.

eeneral Improvement Fund changes for the worst

GIF is commonly referred to as “surplus funds.”  Spending surplus funds on special projects sounds better to the folks back home but it is not really a surplus. It is merely state revenue skimmed from the top and distributed in a different way from the rest of the state budget.  GIF was for one-time state expenditures that Governors and legislators did not want to add the into the agency’s regular general revenue budget, because the extra funds would inflate the agency’s budget for the future.

Another reason politicians like GIF funding is: it allows the general revenue budget to look smaller. Then and now public officials brag how they have worked to hold the line on the general revenue budget, while hundreds of millions more of taxpayer dollars are spent through GIF.

Before 1997 all the projects in GIF, whether requested by the Governor or by a legislator were lumped together in one list and both the Governor and the legislature had to cooperate on GIF spending priorities.

In Act 1356 of 1997 the legislature took control of part of the GIF money by creating a “Legislative Division” of GIF and an “Executive Discretionary Division” of GIF. In 1997 the Legislative Division was primarily about which projects would get funding priority and giving legislators (and not the Governor) credit for many GIF projects.

The creation of a Legislative Division and Executive Division changed the dynamics of GIF.  It quickly created an attitude of entitlement – this is my money. In future sessions, the funding for the Legislative Division was divided between the House of Representatives and Senate and each legislator was given a share. The “share” was unofficial but legislators kept track of how much was being obligated.

The attitude of “it’s my money” gave rise to many legislators directing their shares on purely local projects.  Even non-governmental entities began to receive “grants.” (For example, Boys Clubs etc.). The local projects were popular back home and became a reelection tool. (“Look what he has done for us now. He fought them city slickers and brought home the bacon.”)

Arkansas politicians also created a third division – Shared Mandatory Obligations Division. Just creating a shared division further emphasized that the other two categories are discretionary funds available for legislators and for the Governor.

A setback and the creation of an even worse plan

..... [Read Complete Article]

Isn’t it swell when a power grab from almost twenty years ago works to the benefit of legislators and governors so they can spend more taxpayer money on pet projects?

No? Then you must not be a politician.

Tags: Arkansas,, GIF Money, power Grab, costing, Arkansas Taxpayers, millions, pet projects, Conduit for Action,  To share or post to your site, click on "Post Link". This site is an Outreach of the ARRA News Service.

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