LITTLE ROCK — Heading into his last regular legislative session, and the first since Reconstruction with a Republican-controlled Legislature, Gov. Mike Beebe says he expects fights over issues like Medicaid and taxes but does not expect Washington-style gridlock at the state Capitol.
“I think y’all are making a bigger deal about this Republican-Democratic thing than I do,” Beebe said last week in an interview with the Arkansas News Bureau. “It was pretty even last time, and they seemed to work together. I think they’ll continue to work together. I don’t think they want to be seen as Washington, D.C.”
The 2013 regular session begins Jan. 14. Beebe, who is prevented by term limits from seeking a third term next year, said he expects to continue to have a good relationship with the House and Senate even though his party is no longer in the majority in either chamber. He said that as a 20-year veteran of the Senate, he relates well with legislators.
“Does that mean we won’t have fights? Of course not. Does that mean there aren’t some of them I don’t like? Of course not. Some of them don’t like me. But generally speaking, the overwhelming majority of the members of the General Assembly, both Republicans and Democrats, I find it easy to work with because I have a great deal of respect for who they are, what they represent and what the body is, having spent a major part of my professional life there,” he said.
One issue that could turn into a fight is the question of whether to expand Medicaid. Beebe favors expanding the state program to include people earning up to 138 percent of the federal poverty level, which would add an estimated 250,000 people to the Medicaid rolls.
Under the federal Affordable Care Act, the federal government would cover the cost of the expansion for the first three years, after which the state’s share would gradually increase to 10 percent.
The Medicaid program is facing a projected $139 million shortfall. Republican legislators generally oppose the expansion, arguing that even with 90 percent of the cost paid by the federal government, the cost to Arkansas may be too high.
Legislative support is necessary because a three-fourths vote in both chambers is required to appropriate the federal funding for the expansion. Beebe acknowledged that achieving that threshold will be a challenge.
“If you had 70 Democrats (in the 100-member House) it might still be difficult to get three-fourths,” he said. “Now that doesn’t mean it’s not going to happen. I never say never.”
Beebe said he opposes an idea some Republican legislators have floated for delaying a vote on Medicaid expansion for a special session.
“If you can do stuff in a regular session, you do it in a regular session. It saves taxpayers’ money,” he said.
Also sure to be debated during the session are various proposals for cutting taxes. Over the years, Beebe has successfully lobbied the Legislature to reduce the state tax on groceries incrementally from 6 cents to 1 1/2 cents per dollar spent.
In the upcoming session, Beebe is proposing to reduce the tax to one-eighth of a percent, which would eliminate all but the portion of the tax that cannot be changed without amending the state constitution. The proposed reduction would not take effect, however, until certain budget obligations, including desegregation payments to three Pulaski County school districts and payments on certain bonds, decline by at least $35 million for six consecutive months.
“If I could get rid of it all right now I would have proposed it, but in good conscience I don’t know how you’d get rid of the rest of it right now with a projected $139 million Medicaid shortfall,” Beebe said.
Some legislators have expressed interest in cutting other taxes, such as the capital gains tax and the income tax. Beebe said he would listen to any proposals, but “it’s very difficult to figure out where that money would be coming from.”
In the 2011 session, Beebe initially proposed only a reduction in the grocery tax estimated to cost about $15 million. But he ultimately agreed to a $35 million package of tax cuts, some of them pushed by a GOP contingent in the Legislature that grew significantly after the 2010 election.
Beebe subsequently blamed the additional cuts for budget reductions in a number of state programs, including aid to foster parents, an across-the-board increase for state colleges and universities and a 1.86 percent raise for state workers.
The Legislature may also revisit the issue of school funding. Beebe and some legislators have voiced displeasure with a recent state Supreme Court ruling that two school districts could keep money they collected through a statewide 25-mill property tax in excess of the state-mandated school funding level.
The state has asked the court for a rehearing. Beebe said that if the request is denied, he hopes the Legislature will change the law to make it clear that all money from the statewide tax is to be distributed equally to districts.
Beebe, first as a legislator and later as attorney general, was heavily involved in reforms that led to the Supreme Court’s 2007 decision in the Lake View school funding case that Arkansas’ method of distributing money to public schools was adequate and equitable. The ruling ended 15 years of litigation.
“The big issue for me is that (the court) totally misstated, in my opinion, and did a complete reversal … in the tenets of the sacrosanct issue of Lake View. It’s a bigger issue than just this amount of money for three school districts or two school districts or six school districts. It is the whole issue of, what did Lake View really stand for?” he said.
The newly won Republican majorities in the Legislature have encouraged social conservatives who hope to introduce measures that have failed in past sessions. One bill that is expected to be filed would ban abortions after a fetus becomes able to feel pain.
Beebe said that as far as abortion is concerned, “I thought that was pretty well settled, but you’d have to look at a specific bill, see about its constitutionality.”
Rep. Denny Altes, R-Fort Smith, has said he plans to file a new version of a bill that has failed in the past that would allow handguns to be carried openly, with a permit.
“I have supported legislatively where we are on concealed carry permits. … But open carry, to have one on your hip like an Old West holster, I don’t think is healthy.” Beebe said.