Wednesday, April 2, 2008
The 3 day special session came to a formal close this morning, and the Governor signed the severance tax bill into law at 1:00 this afternoon. The called press conference for the bill signing produced an overflow crowd at the Capitol. The Governor fielded questions after the formalities were completed, and related his philosophy that the proceeds of the highway severance money should, for the most part, follow the cars. In other words, high traffic areas will have the inside track. Rules and regulations will be developed over the coming months to determine how and where the money will be spent. Well, my first special session is history and everything went smoothly. All is done here and if nobody minds, I'll stand adjourned.
Tuesday, April 1, 2008
Here is my take on the special session thus far. Questions abound regarding the true impact of raising the severance tax. Some want to point out that the 5% rate is more along the lines of 1.5 % once the exemptions and concessions are factored in. Others will say that the bulk of the proceeds should go to tax relief before highways. Still others are worried that the tax will somehow filter down to the consumers and raise their energy bill. It is true that many of the concessions have lowered the base rate for a period of time. But the fact is, in order to pass this legislatively, a compromise had to be reached between the parties involved. If Sheffield Nelson's 7% initiative were to go before the voters, there was no guarantee that the gas companies wouldn't spend millions to defeat the measure. If that happened, then we're in the same place we've been for 50 years, getting virtually nothing for this non-renewable resource. As far as tax relief goes, there is still more work to do there, especially with the grocery and income taxes. But this money is earmarked for roads and highways, and the need there is great. I think it unlikely the consumer will feel the severance increase, since this gas won't end up in Arkansas homes. Gas prices are set on the open market anyway, and the only people who will end up paying are the gas producers themselves, and to a small degree, some royalty owners. In the end, I believe this is a good step forward for the future infrastructure in Arkansas, and that's why I voted for it.
The House convened this morning at 10:00 and made quick work of the three bills presented. The Governor's severance tax bill was passed on to the Senate by a vote of 81 yeas, 16 nays and 1 present. The other bills included Rep. Bond's legislation to repeal his marriage bill from the last session, and Rep. Hyde's request to extend the time frame for the Pulaski County school district's desegregation case. Both met little opposition. We adjourned until 1:30 this afternoon, and it looks like we'll be back Wednesday morning to finalize things, and hopefully home by supper.