2015 in Review

BY STATE SENATOR LARRY TEAGUE –

LITTLE ROCK – The new year will begin with an extensive review of the single largest state agency, the Department of Human Services.

The governor ordered the review, which will be headed by the lieutenant governor and which will examine the organizational structure of the department to determine if any areas lack resources or can be made more efficient. Assessors will keep an eye open for duplication of services.

The organizational review coincides with the prior resignation of the department’s director, who has agreed to stay on until a successor is appointed. It also coincides with a legislative task force effort to trim about $835 million from the agency’s Medicaid budget over the next five years.

Legislative leaders predicted that it would require difficult decisions to reduce Medicaid spending by that amount, but tough choices must be made because Medicaid is projected to increase by 5 percent a year unless changes are made. For years the health coverage program has created problems for legislators, who must approve a balanced budget every year.

The Arkansas balanced budget law is known as the Revenue Stabilization Act. If state collections of revenue fall off because of a downturn in the economy, state agencies must make corresponding reductions in their spending.

In a related development, the governor has ordered all agency heads to cooperate with an independent assessment of state government being conducted by a private foundation, the Arkansas Policy Foundation. The group will look at ways to make government more efficient, transparent and accountable. The review is called the Efficiency Project. Its findings are expected to be final by the summer of 2016.

Study of Arkansas Dental College

The Review Subcommittee of the Legislative Council agreed to a $634,000 contract with an Atlanta consultant that will help the University of Arkansas for Medical Sciences initiate a new state dental college. Arkansas is one of 14 states that does not have a dental college, and students who want to become dentists must earn their degrees elsewhere.

The consultant will determine if the extent of a need for an in-state dental college, and whether it would be financially feasible to meet that need.

Lottery Revenue

The state lottery brought in $32.2 million in November, compared to $30.6 million in November of 2014. It was still quite a drop from the best November on record, in 2012, when the lottery brought in $39.4 million. In 2013, the following year, it dropped dramatically to $31.2 million.

The co-chairman of the lottery’s Legislative Oversight Committee said that lottery revenue is driven by gasoline prices. When gas prices are relatively low, people are more inclined to spend on lottery tickets when they’re filling up at convenience stores.

Also, lottery officials are trying new games, new strategies and new marketing campaigns to increase the awareness and attractiveness of the lottery. After prizes are paid out and administrative costs are covered, lottery revenue is distributed to the Department of Higher Education and provided to college students as scholarships.

In November $5.5 million was made available for scholarships. In November of 2012, $8.4 million was raised for scholarships.

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