Region 8 Reps Hint at Additional Tax Increase

May 12, 2003
Posted at: 9:44 p.m. CDT

PARAGOULD, Ark. -- After the completion of at least one special session of the Arkansas General Assembly, two Region 8 legislators are expressing satisfaction with what they called a successful week in which a new budget was passed, and a budget shortfall solved.

However, one member of the House of Representatives that a further increase in taxes may face Arkansans as they look to solve the state's education funding woes.

On Friday, legislators agreed on a budget that will fund the state for the next two years. Part of the need for the special session called by Governor Mike Huckabee arose because of a $110 million shortfall that legislators could not find the answer for after 94 days of the regular session. Last week, the assembly agreed to a two tobacco tax increases and an income tax surcharge to overcome the projected deficit.

State Representatives Chris Thyer, D-Jonesboro, and Gary Biggs, D-Paragould, say that the special session was successful, and that tax increases were inevitable. Thyer says the two-week break between the regular and special sessions was needed. Tensions, he says, were running high among his colleagues.

"The two week break let everyone get home and get to their families, and remember why we went down there to begin with," Thyer said.

The solutions determined by the Assembly: A three percent surcharge on state income taxes. A seven percent increase in the tax on wholesale tobacco sales, and a 25-cent per pack increase on cigarettes.

"The product we came up with at the end (of the session) was better than the product we were going to vote on if we stayed a day or two (at the end of the regular session)," Biggs said.

The extra revenue we raised last week," Biggs continued. "Only covers and gets us back to ground zero, so to speak. It doesn't give us any extra money."

The revenues do also cover Medicaid and prison costs as well as college scholarships. Other education funding is what is next on the agenda for the legislature.

"(Education) was the number one priority coming into the session," Thyer said. "It's just that most of us thought it was something we had to do in September, because we won't get the adequacy study back until then."

September is a few months away, but already thoughts are leaning toward another tax increase to take care of the state's inadequate education funding system. Biggs thinks the sales tax will likely be increased by one cent to take care of education.

"Probably the sales tax will be increased in the fall, that seems to be the consensus," Biggs said. "That's why we wanted to leave it alone in the special session."

It is believed the governor may consider calling another special session for the summer. However, both Biggs and Thyer say a new session is not necessary. Biggs contends that it would be too costly. Meanwhile, Thyer says he would rather spend the time speaking to his constituents.