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Mar 6 112 tweets 12 min read Read on X
We are here and set up in the room! Pretty crowded this morning. There will be three days of these meetings.

On the agenda today: Higher Education and various subdivisions of Dept. of Correction.

Our thread following the day's events starts here.
These "pre-fiscal session budget hearings" are where the legislature will decide what to prioritize in the upcoming session. Various departments and divisions will make their case to the legislators: how much money they need, why they need it, and how they'll use it.
Per usual, we're tweeting live, so forgive any typos and small mistakes!
One thing we're looking for today: does the continued dustup between Gov. Sanders, the AG, and various prison boards cause any hostility from the Gov's allies in the leg?
First up: a couple rule changes. They're simple and perfunctory, adopted immediately.
Sen. Dotson lays out the day: the Executive Branch will present their proposal for a balanced budget. The Sen. asks questions stick to appropriations and not spending levels.
DFA starts with a bit of water-carrying for Sanders' Asia trip. "She's our best salesperson."

Sure, Jan.
Gov. asked dept. heads to find ways to hold down growth: felt 3% growth year after year was unsustainable.

Goal was apparently achieved: 1.7%.

100 million dollars allocated for LEARNS (you know how we feel about that).
FY25 adds 3.8 million for another state police academy. We'll circle back to that later FOR SURE.
As a quick reminder: this is for fiscal year 2025- fiscal year 2024 was approved last year.
Back to business: 65 million for vouchers. Goodness gracious.

Meanwhile, only 4 million added for career and vocational education.
The leg approved two additional troop schools last year - that's the 3.8 mil we mentioned above. Equipment, training, etc.
Biggest changes overall to budget is to education for LEARNS. Sen. Flowers with the first question.
She's asking about additional 2 million for UAPB; she notes the university asked for over 7 mil. She wants to know why the state isn't trying to match.
Response: unsure whether the 1.6 mil needed for the state match is over one or two years. Money will be set aside in restrict/reserve accounts to make sure that 100% of the needed funds are allocated.

Flowers is grateful and satisfied!
Sen. Peyton: question about ag funding. Answer: we've allocated money to cover any shortfalls. He's also satisfied.
Sen. King: the forecast for LEARNS keeps changing. Why? Where are we finding the money? You've reduced several times. He believes the forecast is unrealistic and that the leg is being bamboozled.
Dotson cuts in to defend the Gov.
Sen. Leding: Division of Workforce Services hiring (might have missed that?) is down almost 97%, which has huge effects on folks looking for unemployment benefits.
The Governor's folks are done! Higher Education up next.
Funding recommendations for institutions is made on productivity model. Slight decrease in the model this year; with negative productivity, no NEW funding will be requested.
Recommendation in Gov.'s budget that one-time incentive funds are used to make up the difference - looks to be about 4.5 million.
Funding from institutions that have negative productivity is re-allocated to productive institutions (put a pin in this, but productivity models often create death loops like this: if you don't make your targets, you lose money which makes it harder to make your targets next year
For two year institutions, seven institutions received new funding. Several institutions are at the floor of possible decreases - they can't lose any more funding or they may go under.
Sen. Chesterfield up: concern because higher ed has been underfunded for years, and now we're taking away a million from UCA, half million from UALR and UAPB and reallocated to U of A. How does this get us to productivity? (exactly what we said above!)
U of A has plenty of money, so why don't new enrollments - largely increasing - leading to new money?

A: these models are two years behind. This is the first year of full COVID impact. Funding based on 3 yr. rolling average.
Sen. wants to know how we define productivity.

A: growth, retention, credentials produced, affordability.

Sen: 3 yr rolling average based on a once in a century pandemic. How does this make sense?
A: we determined to go ahead with the model this year to see if COVID impacts could be isolated. If so, the model will be continued.

Sen: "that is so interesting."

Sure is.
Dotson: notes that the money itself is staying in higher ed, just going in "different buckets."

Sen. Chesterfield wants to know where those other buckets are. Turns out it is U of A F. UCA is in fact losing money to U of A.
Also apologies: chair is Dismang, not Dotson. Replace any "Dotson" in the thread with Dismang! Our bad.
Higher Ed folks: "we're doing the best we can with what we're given."

Borrowing rate for underperforming institutions is only .02%. The productivity comparisons are only against themselves, not against other institutions.

Sen. Chesterfield appreciates the responsiveness.
Sen. Hammer wants to know total dollar amount of money being put into funds.

A: 4.5 million.

Q: why are we withholding money that could be used to increase those productivity levels?

Great question! Seems logical.
A: Funding hasn't increased relative to consumer price index, and we have to compete with other competitive markets. This formula helps us keep the Ark. market as a whole competitive.

Higher Ed. sounds a bit frustrated with this formula.
Sen. Hammer: How much longer can we use COVID as an excuse?

A: hopes we're climbing out, but enrollment cliff supposed to hit next year. Doesn't believe Ark. will be hit as hard as other areas, but it'll be tough to keep enrollment up.
Sen. Tucker: big picture: over last couple decades, state has lowered support for institutions of higher ed, leading to higher tuitions. Scholarship amounts have remained relatively static. Correct assessment?
A: yes, but we've recommended revisiting this to try and increase scholarship funding.

Tucker: a scholarship you got 5 years ago doesn't help as much because funding remained the same, but tuition has risen. How do we fix this?
A: seems to be blaming it on inflation? Try to keep rates low, but we also have to keep folks in the institutions employed.

Tucker wants to revisit this; appreciates the answer but dissatisfied with the situation.
Sen. Peyton: wants to revisit the history of this productivity model.

A: higher ed wanted it as part of a deal to increase funding for higher ed as a whole. Productivity is down across the board, hence the negative.
Rep. Scott: Will we see layoffs at Henderson because the reduction in funding? Layoffs at other schools because similar reductions? Will shortages be passed on to the students?
A: will try to avoid layoffs, but can't guarantee it. Passes the buck to chancellors in the room; it's up to them to manage the budget. Doesn't answer the part about the students.
Sen. Stubblefield: "give me a real simple definition of productivity."

A: "no. but I'll try. It's complex by design."

Number of degrees/certs produced. Multipliers based on higher demand degrees, under-served populations achieving those degrees.
Reiterates that institutions are only compared against themselves in the 3yr rolling average.
Q: how does this relate to the fact that majority of students are working jobs ten years later are in a different field?

(ridiculous question)

A: Degrees are designed to have transferable skills. Drawing a straight line to industry job from degree is hard.
It's a ridiculous question btw because educations are designed to be diverse, to teach students about the world. Seeing education as simply job training is looking at educations with a blindfold on.
Sen. Hickey: going back to loan fund. There's not an appropriation for this fund, so a letter from Gov is required. Wants separate letters for each college so they can be precise with allocation. Great idea.
There's a correction: the loan interest is 0.2%, not .02%. Hickey says this is basically just funding because it's so negligible. This is the first time this has happened, but wants to ensure it comes to Peer for the Leg to discuss.
Rep. Wooten: For positions that are vacant for over two years, how many of those are in the budget?
A: Isn't sure, but unfilled positions don't affect insurance, so position changes aren't related to funding requests.
Q: asks about interest income.

A: doesn't have an answer. Institutions don't have to report direct to Higher Ed, but funding reports would show that.
Sen. Flowers: what does Higher Ed have already for facilities and maintenance without the loan program that's been discussed.

A: Nothing from the department level, no state funding.

Q: for critical maintenance, anything recommended?

A: 300 million in needs, but no funding.
Institutions could request money from this loan fund to perform this critical maintenance.
Hammer: wants to know how Henderson will repay a previous loan with their reduction in funding. Dismang defers the question down.
Next up: requests for increases in personnel from ASU (net 16) and Ark Tech (18). Fayetteville wants 30 more (most grad assistants).

Sen. Sullivan: are any of these positions dedicated to DEI? (goodness gracious)

A: no.

Letter adopted.
Request for new appropriation section for UAPB. Would allow for more transparency on funding.

No questions, motion adopted.
A BLR rep now walking them through various sections in their reports.

Return to Sen. Hammer's question about Henderson.
Henderson Chancellor up to answer the question.

A: Henderson is doing our part to stay conservative in our budgeting, we feel good about that, so we will continue to find ways to meet our obligation.
Hammer: Where did original 6 million dollar loan come from?

A: Budget stabilization trust fund. Payments will be returned to that fund. Wants to appreciate the legislature's dedication to keeping the institution open.
Sen. Dotson (actually Dotson this time!): wants to know more about the payback schedule for the loan.

A: payments begin this December, 900k per year till the loan is disbursed. There's no interest.
That's how the Budget Stabilization Trust Fund always works, so nothing weird there.
Sen. Chesterfield: will these cuts result in an increase in student fees?

A: yes, but first time we've increased in two years. We will need to make up some ground. We will be as prudent as we can. Notes that they are still the most affordable university in Ark.
Q: Any 2 year programs that would make students eligible for the ARFutures grant?

A: No.
Lot of appreciation for Henderson's grit in a difficult situation.

Rep Wooten: has anyone looked at prosecution at those responsible for the situation?

A: Leg Audit sent all info to a prosecuting attorney, but there was technically nothing illegal. Just terrible management.
Too many scholarships, too many raises created a snowball. Board has been completely replaced with the integration into ASU system. Board at the time wasn't properly provided info that could have alleviated the problem.
Questions for UAMS for Sen. Hammer: wants to know why there's an additional 60 million request.

A: in our cash appropriations we need 2.4% increase; we've been growing and are opening new facilities.

Q: are you operating at full capacity?

A: still working on it, but better.
Q: why not more emphasis on staffing issues instead of this expansion?

A: Additional appropriations will allow for that growth. We have an action plan to move to full capacity.
A: additional growth also drives more margin to our bottom line, which helps us increase capacity.
Sen. Chesterfield: wants to know about the 30mil deficit in the news.

A: no deficit! Positive 12 million. Applause!! "We've done a lot of work to get here."

An asterisk: new initiatives are affecting our bottom line. A lump 30 million payment allowed the positive flip.
But we are confident we can maintain that.

Sen. Johnson: wants to know about housekeeper outsourcing. Are there definitive savings realized, or are we just moving state employees to private?

A: Net neutral in cost, but outsourcing limits turnover, which we struggled with.
Rep. Kavanaugh: wants to know about employees whose salaries have been leased to other departments. They'll get the info to her later.
Sen Hammer: wants to know about physician retainment.

A: They'll get him the physician-specific data.

Q: 60 million appropriation request - will it go to physicians/positions that are *outside* medical providers, like DEI?

A: Nope, strictly medical.
Rep. Wooten: wants to know about the high number of administrative and academic positions. (Wild question)

A: Reminds him that this is a medical school (can't believe this is happening) so physicians are also classified as academics. Admin positions include those at hospitals.
A: three business lines on UAMS. Colleges, Clinical Enterprise, and Research. Research often classified as admin. Colleges and Clinical Enterprises have a lot of crossover with academia.

He wants a more precise breakdown. Really not letting this go!
Rep. Springer: Does this budget include Col. Glenn and NLR campuses?

A: Yes, all UAMS facilities across the state.
Higher Ed is done! We are onto Corrections.
High level discussion of how the budget manual works. Only covers the largest 6 departments.
Unfortunately missed the current question, but seems to relate to funding for daily totals in the jails.
Rep. Springer: wants to know about interest-drawing accounts at UALR. Very interested - has about 1.5 million in it.

A: accounting working on it.
Sen. Chesterfield: How many women are working in these institutions?

A: Doesn't have the number in front of him.
Appropriations for Corrections looks a little different. There's some transfer to Public Safety.

County Jail reimbursement: 26 mil. $40 per day per inmate.

Otherwise, no significant changes.
Sen. Chesterfield: same question: what ratio of guards are female?

A: over 50%.
Rep. Shepherd: Transportation of juveniles.

A: that's actually Dept. Public Safety.
Rep. Kavanaugh: separating medical contracts from professional line items?

A: Yes.

Q: Regional jails at $8million +?

A: we're letting go this appropriation.
Sen. Hammer: can you give us an update on White River bed capacity?

A: 170, and we're looking to finish the construction by August.
Q: eventually we'll have a new jail that will relieve capacity at county jail. How do you see it playing out on your budget if new prison is 3-4 years out?

A: lot of internal efforts to bring numbers down. Added 1400 beds across the state.
But still expensive to reimburse county jails, and will always be needed. Lots of outstanding warrants. Mentions potential for out of state beds!!
Hammer: would very much prefer to keep inmates in state. Should expand county jails first before we consider out of state.
Sen. Tucker: wants to be sure we're not looking only at max security beds - reentry beds, treatment beds, etc.

A: definitely. Wants to expand reentry to improve stream between incarceration and community.
Rep. Wooten: similar to UAMS, concerned about number of positions.

A: majority are security positions.

Q: of vacant positions, how many are budgeted?

A: not sure, will get you that info.
Sen. Flowers: wants clarification on potential for out of state housing.

A: Nothing currently budgeted, just part of the discussion on bed numbers.
Sen. Petty: are these appropriations taking into account the new rate of cost of housing state inmates in county jails? County jail folks say not covering all expenses.

A: fluctuates from county to county. We don't set that rate.
Sen. Petty really wants to revisit this reimbursement rate. Simply not enough to cover costs. Rep. Wooten wants to follow up.
Q: how do you make the decision on who goes to county jail and who stays in state prison/vice versa, and which counties they go to?

A: Primary consideration is capacity. Over 2k in county jail backup. 1500-1800 is much more acceptable. Inmates are transferred 3x a week.
Q: services in state prison are more robust than county jail. How do state prisoners in county jail get those services?

A: counties provide those reports.
Rep. Richardson: what is the cost to expand beds vs. moving them to another state? Any savings to be had?

A: No exact numbers, but would expect it to be roughly the same.
Sen Hammer: wants specifics on the process for constructing new beds.

A: currently we're thinking the I40 corridor, no facilities in that area currently.
Q: knowing there's going to be a gap in budgets/new construction, what's the solution to make up that yearly gap?

A: it's still a capacity issue. Trying to get new construction moving ASAP. No one wants out of state beds but we have to keep all options on table.
Rep. Holcomb: given any thought to alt. housing? In the long run it wouldn't help, but could disabled/elderly inmates be transferred to low security nursing homes or similar facilities?

A: we are looking into it! Trying to best use spaces.
Sen. Peyton: 3k bed facility is big, complicated construction for such a facility. Have we thought about building 3 1k bed facilities that could come online faster?

A: nothing off the table. Idea of 3k bed facility was a complex. Could be divided between reentry, max beds.
A: easier to staff one location due to economies of scale. But if scale gets too large it becomes net negative.
Dismang: we've known we needed more beds for years, we've earmarked money, but we've stagnated in location selection. Why no push to finalize and start movement on the project?

He's undermining the board a bit. He wants to have this conversation with them and firm a timeline.
Subtle version of what we expected: SHS's cabal coming for the board of prisons whenever/wherever they can.
Sen Hill: any quotes on out of state costs?

A: There's been discussion - Texas, Georgia, and Michigan. Probably about the same amount of money - $70 a day, includes medical.
Rep. Rose: we're paying county jails 40 a day and force them to take the financial hit, when we could send those inmates out of state for the same cost as the state prisons?

A: yep!
Sen. Hammer: have we already turned loose some of the money allocated for the new construction?

A: part of it; we're still sitting on some of it - 335 million.

Hammer wants to know if legislative branch could "insert ourselves" to push for a resolution.

Dismang nervous.
Also nervous because of inaction. Dismang wants discussion on what the actual plan is, because everyone frustrated with current situation/inaction.
Sounds to us like the legislature is really frustrated with delays, inaction, current situation all around. Wondering if they really will try to use power of the purse to force a resolution to the current standoff.
Rep. Kavanaugh moves to accept exec recommendation. Motion carries.
Division of Correction now (why there's two entities called Dept. of Corrections and Division of Correction, we'll never know)
No questions. Exec rec accepted. Div. of Community Correction now. No significant changes, exec rec is accepted.
Last up: Post Prison Transfer Board. No changes again, no questions, no commentary, exec rec accepted.
Whoops, not last: Sentencing Commission. Exec rec accepted, and we are done for the day. Thanks for following along! We'll be back tomorrow at 9AM for DHS.
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