Davy Carter Wants More Say on State Budget (AP Interview)

CABOT — The incoming speaker of the Arkansas House says he wants lawmakers to be able to revisit the state's budget after it's passed during the Legislature's regular session next spring and that he's not certain whether lawmakers can find middle ground on a proposal to expand Medicaid.

As he prepares to gavel in the 2013 session as the first Republican House speaker in Arkansas in 138 years, Rep. Davy Carter said he's already trying to figure out what role the Legislature can have in the state's fiscal policy once members leave the Capitol.

"We've got so much uncertainty, with Medicaid, so much uncertainty with Washington and the fiscal cliff and the things we've got going on there," Carter told The Associated Press in an interview in his office at Centennial Bank in Cabot. "This world is moving pretty fast and for us to adjourn and then show back up and not maintain that accountability I think is a disservice to Arkansas."

Grappling with that uncertainty, which includes a $138 million shortfall in the state's Medicaid program, is the top priority for Carter as he moves closer to the start of the regular session. Carter, 37, has had a very short window to adjust to his new role as the House leader of the 89th General Assembly.

Carter was elected speaker in November following a surprise challenge to fellow Republican Rep. Terry Rice of Waldron. Rice had been widely viewed as the GOP's pick for speaker after Republicans won control of both chambers in the election, but Carter won the post with the support of the chamber's Democrats and a handful of fellow Republicans.

The new Speaker said he believes House members have moved on from that contentious vote and are ready to focus on the Medicaid shortfall, a proposal to expand the program and competing ideas to cut state taxes.

Currently the chairman of the House Revenue and Taxation Committee, Carter said he wanted the House to wait until the end of the session to take up any proposals to cut taxes. Democratic Gov. Mike Beebe has proposed further cuts in the grocery tax, but only if the state's obligations in several areas decrease by $35 million over a six-month period. Those obligations include desegregation payments to three Little Rock-area districts that the state has asked a federal judge to end.

Carter pointed to the way his panel handled tax cut proposals during the 2011 session, when lawmakers waited until the end of the session to pass a package that included a proposed reduction in the grocery tax. Carter would not say whether he supports the grocery tax reduction and said he believed an expected proposal to cut state income tax rates would be the likeliest competitor to that idea.

"Groceries are high and I understand where the governor is coming from on his grocery tax proposal. On the other hand, there are some competing ideas to provide taxpayers with some relief that some would say have more of an economic job impact on the state," Carter said. "I don't know which ones we end up choosing. I think we go through the proess like we did two years ago."

But whether the state can afford any cuts is still uncertain. Beebe has said he proposed the triggered tax cut because he couldn't find room in the state's $4.6 billion budget for relief without hurting critical services. Carter said the big question that remains on tax cuts is how the state tackles its expected Medicaid shortfall.

Carter said he's unsure whether lawmakers can find common ground with Beebe on a proposal to expand Medicaid's eligibility under the federal health care law. Beebe backs the expansion, which would add 250,000 people to the program, but Republicans in general are opposed to the idea.

Carter said there may be room for a compromise that would allow for changes to the program that Republicans believe would save the state money, but said it depends on how much flexibility Arkansas will have. Federal officials already closed the door on one avenue for compromise when they told states that they couldn't opt for a partial expansion and still receive full federal funding for its first three years.

"Until I can be convinced that we can afford it, I'm going to be extremely hesitant to be able to support expansion," Carter said.

Carter also said he believes it's possible to fill the projected Medicaid shortfall without making cuts in services proposed by Beebe's administration, but wouldn't detail where the money would be found. The Department of Human Services has called for cuts in several areas to make up for the projected deficit. Beebe has said the savings from Medicaid expansion would help the state avoid the cuts that would affect more than 10,000 Arkansans in nursing homes.

"I don't think we have to make those decisions this session," he said. "I think there ought to be ways for everybody to stay pat where we are and plug those holes and then try to fix the problem going forward."

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