Arkansas Business' 25 Legislative Actions (25th Anniversary)

by Arkansas Business Staff  on Monday, Mar. 23, 2009 12:00 am  


How has Arkansas' legislative climate evolved over the past 25 years? Take a look at the following developments, in chronological order. 

1. Creeping Sales Taxes(1983-2004)
Starting with a 1 percent increase at a special legislative session in the fall of 1983 and collected in 1984, the Legislature has doubled the state sales tax in the past 25 years, raising the rate five times – four for public education (1983, 1991, 1999 and 2003) and once for conservation by way of a 1998 constitutional amendment raising the tax one-eighth of a cent for parks, tourism and the Game & Fish Commission. In 2004, the General Assembly expanded the definition of a taxable transaction by including 14 consumer services ranging from body piercing to car towing – criticized as "the tax on industries without lobbyists."

2. Teacher Testing (1984)
Needing conservative votes to pass his sales tax at a special legislative session in the fall of 1983, Gov. Bill Clinton proposed requiring all teachers and administrators to pass a basic-skills test to retain their teaching certificates. It was an idea first broached by his wife, Hillary, who chaired an education reform committee. The bill passed despite the opposition of the Arkansas Education Association, and it brought over enough votes to pass the sales tax. The test was first administered in 1984.


3. Four-year Terms (1984)
A constitutional amendment proposed by the Legislature and ratified by voters extended the terms of the seven state constitutional officers from two to four years, ending what had effectively become a perpetual campaign season.

4. Clinton Economic Program (1985)
Clinton offered a large package to stimulate economic development, and almost all of it passed: changes in banking laws, start-up money for technology businesses and large tax incentives for Arkansas industries that expanded production and jobs. Arkansas was one of the most successful states in terms of job creation in the next six years.

5. Revenue Bonds (1986)
The Arkansas Supreme Court shocked government and business leaders by interpreting a 1934 constitutional amendment requiring popular votes for all bonded indebtedness to mean what it said, which effectively outlawed traditional revenue bonds. An amendment exempting from the election requirement all bonds that did not pledge tax revenues was quickly drafted and ratified by voters.

6. Tech Colleges (1991)
Legislation crafted by state Sen. Nick Wilson, D-Pocahontas, converted a number of vocational-technical schools to technical colleges. To pay for the new "work force" program, the corporate income tax was raised to a flat 6.5 percent on incomes greater than $100,000. Formerly, the tax was graduated up to 6 percent.

7. Term Limits (1992)
Voters approved an initiated amendment limiting state constitutional officers to two terms, state senators to two terms, state representatives to three terms, members of the U.S. House of Representatives to three terms and U.S. senators to two terms. The federal courts invalidated the congressional limits because they violated the U.S. Constitution.

8. Workers' Comp Reform (1993)
Responding to rising workers' compensation insurance costs, the Legislature passed a sweeping overhaul of the law, shrinking the definition of "compensable injury" to require that it be caused by a specific incident at a certain time and place and making it nearly impossible to win claims for carpal-tunnel syndrome, hearing loss and the like.

9. Any Willing Provider (1995)
The Legislature, egged on by state Sen. Bill "Gwatzilla" Gwatney, D-Jacksonville, enacted a law prohibiting insurers from excluding from health-coverage plans any doctor or hospital willing to accept its payment terms. Arkansas Blue Cross & Blue Shield won a court injunction against its implementation, but a U.S. Supreme Court decision in 2004 upheld a similar Kentucky law, leading finally to the implementation of the Arkansas law 10 years after its enactment.



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