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Legislative digest - March 12, 2014

In the fourth week of the fiscal session, the House approved the funding mechanism for the private option and now a $5 billion balanced budget has been drafted and is ready for a vote.

With a vote of 76-24, the House passed SB111 March 4. This is the appropriation for the Department of Human Services Division of Medical Services. It is the appropriation needed for long-term nursing care, Medicaid, AR Kids B, and Arkansas’s unique program to provide health coverage to low income Arkansans called the Private Option. The Governor signed the bill into law March 7.

Currently over 127,000 Arkansans have been determined eligible for the Private Option. This allows individuals making under $15,414 a year or a family of four making less than $30,000 a year to shop for a private market insurance plan. The premiums are paid with federal Medicaid dollars.

Soon after the passage of the Private Option, the final work began on the budget.

One of the first issues to resolve was how this General Assembly will spend the $120 million in projected surplus from this year.

Several bills have passed which would spend over $21 million. The remaining surplus will be saved until the next regular session.

The bills devote $5 million to public facilities for open enrollment charter schools. Another $5 million will be directed to matching grants for broadband for public education.

Under the proposal, the Health Department will receive $2 million of the surplus for its Breast Care Program. And close to $10 million will go to the Department of Correction for county jail reimbursements, compensation pay for employees, and operating expenses to open 200 additional beds.

Our final order of business will be to pass an amendment to the Revenue Stabilization Act. By law, this is what is needed to fund appropriations. The amendment must present a balanced budget.

This year’s balance is $5 billion in General Revenue. The RSA proposal before us increases spending in education by $65 million from the previous year.

The only decreases in funding are for UAMS and the Health Department. Approximately $9 million for those agencies has been diverted to the Governor’s Rainy Day Fund.

The transfer was made anticipating that the Private Option will reduce costs for the departments by lowering uncompensated care.

However, if the money is needed at a later date, the agencies can come back to the legislature and request money from the rainy day fund.

We have posted the entire budget on our website at arkansashouse.org. We should wrap up the work for this fiscal session by Friday.

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