Last Friday, Gov. Sanders announced she was calling the Legislature to the Capitol for a Special Session to pass tax cuts, clean up conflicts within the LEARNS Act, and make changes to the state’s Freedom of Information Act (FOIA).

Every issue we work on connects to taxes. The state needs public dollars to fund the public investments we all care about. Over the past decade, Arkansas policymakers have repeatedly cut personal and corporate income tax rates, adding up to more than $1.6 billion cut from our state budget annually, with the benefits overwhelmingly flowing to people and companies at the very top.

On Thursday, SB8 cleared its final hurdle on its way to the Governor’s desk. SB8 permanently drops the state’s already-low top personal income tax rate down to 4.4% from its current 4.7%, as well as reduces the rate on corporate income to 4.8% from its current 5.1%. SB8 gives a one-time, nonrefundable tax credit to some Arkansans. Even with this credit, the bill offers only meager benefits to most low- and middle-income taxpayers, versus a permanent windfall to our state’s wealthiest households and corporations. The corporate and individual income tax cuts will cost the state $222 million per year in public dollars.

While we did not get the legislative win we had hoped for, we are proud of the work of our partners and fellow advocates in raising awareness about the importance of a robust state budget. We all want Arkansas’s children to thrive, so we must insist on ensuring the state can provide for the well-being of kids who depend on things like an adequately funded state foster care system, summer reading programs, health care for children and families, pre-K, and a strong public education system.

Everyday Arkansans really showed their strength at the Capitol this week in the fight against a major effort to weaken our state’s public records law (FOIA). The proposed changes would have made Arkansas Advocates’ work much harder by shielding from the public many documents we use to do our jobs here. Though a new law passed this week does make changes to FOIA, the changes didn’t gut the law, thanks to the public’s intervention.

So, Thank YOU!

Thank you to everyone who called, emailed or reached out to your legislator in any way during this brief session. Despite the media’s primary focus this week being on FOIA, you helped keep tax cuts in the conversation. And we are confident there were more No votes on the bills than if we hadn’t been making good noise.

If you’d like to say Thank You to the legislators who voted No, you can find the list of how they voted here: Senate and House.

Tax Cuts in the News

Even when the bills we oppose pass, or the bills we support don’t, we are encouraged to see the issues we care about gaining traction in the media. The more people we can help to understand the importance of a strong state budget and the risks posed by repeated tax cuts, the better our chances are at keeping our lawmakers from completely eliminating income taxes. 

Here are links to some of the coverage we tracked:

• OPINION | KEESA SMITH: Time not right
• Capitol View with Roby Brock
• Arkansas looking at its third state income tax cut in 13 months
• The Arkansas special session tax cuts explained
• Arkansas tax cut proposal met with opposition, people say money should be spent elsewhere
• Legislation reducing Arkansas’ top individual income tax rate, top corporate income tax rate sails through committee
• Proposed Arkansas bill to cut taxes for individuals and corporations sparks debate
• 40/29 Emma Claybrook
• Arkansas House joins Senate in passing tax cuts bill
• House committee advances bills that would trim Arkansas’ top individual, corporate income tax rates
• Sanders, Arkansas Legislature enact income tax cuts on final day of special session

Arkansas Coalition for Strong Families

A lot of the work this week, and in the months leading up to this special session, has been led by the Arkansas Coalition for Strong Families. The coalition is a group of organizations around the state working on mental health care, education, disability rights, racial equity, family economic well-being, and more. Though the organizations each advocate on different issues, the coalition came together to create a shared vision of some of the programs the state government would invest in if it put children, families and the places they live, work, and play, first. 

AACF is a part of and provides staffing for the coalition, which is currently comprised of 15 member organizations. The coalition hosted a rally to Invest in Our Future, in opposition to the proposed tax cuts, on Tuesday, September 12. You can watch a recording of the rally here.

For more information, visit arstrongfamilies.org, or click here to sign up for action alerts from the coalition.

All the Bills that Passed

Here is the list of the bills that passed during the Special Session, along with a brief description.

HB1002 (SB3) prohibits the state government from requiring any form of COVID-19 vaccine for its employees, except in pre-approved circumstances where federal funding is at risk. Read about this here.

HB1004 (SB1) establishes a reserve fund for the state using some of the budget “surplus.” The account will be used to fund state programs and services in the event all the tax cuts lead to insufficient revenue. 

HB1005 (SB4) requires schools to keep all exterior doors locked at all times.

HB1006 (SB6) changes the effective date of a law that prohibits the early release of someone convicted of certain felonies while in possession of a firearm.

SB5 makes a correction to the Governor’s education reform bill, the LEARNS ACT. The way the bill was originally written, students with disabilities were at risk of losing their state funding to attend private schools. The new bill ensures these students will continue to receive funding to remain in their placement.

SB8, as mentioned above, permanently drops the state’s top personal income tax rate to 4.4% from its current 4.7%, as well as reduces the rate on corporate income to 4.8% from its current 5.1%. It also gives a one-time, nonrefundable $150 tax credit to Arkansans earning less than $90,000 a year. (See a lot of news stories in the section above.)

SB10 was the Legislature’s eighth and final attempt to amend the state’s Freedom of Information Act. The version that passed exempts security-related records pertaining to the Governor and other constitutional officers from FOIA disclosure requirements. Read about this here and here.