Reserve funds shift

The Arkansas House and Senate voted Thursday to send the governor identical bills that will allow the state’s chief fiscal officer to transfer $50 million from the longterm reserve fund to the general allotment reserve fund for economic development incentives.

The House approved Senate Bill 5, by Senate President Pro Tempore Jimmy Hickey, R-Texarkana, and the Senate approved House Bill 1002, by House Speaker Matthew Shepherd, R-El Dorado. The bills became Act 8 and Act 10, respectively.

Under the new laws, the chief fiscal officer, after deciding that funding for incentives is needed, may transfer that money to the Quick Action Closing Fund for economic development incentives for U.S. Steel’s proposed expansion in Mississippi County. If U.S. Steel receives the money, the funds would go toward infrastructure for the site of the proposed expansion, said Rep. Lane Jean, R-Magnolia.

The long-term reserve fund is expected to receive that $50 million from the state’s property tax relief fund by the end of this year, Hickey told the Joint Budget Committee on Tuesday.

These identical bills also will transfer $31.6 million in state agencies’ unspent money from fiscal 2021, Hickey said.

Of that, $17.4 million will be transferred into a restricted reserve account, increasing its balance to $28.5 million. A majority vote of the Legislative Council is required to spend the account’s money, Hickey said. The bills will transfer the remaining $14.2 million into a different restricted reserve account, increasing that balance to $50 million, which requires a three-fifths vote of the Legislative Council to spend, he said.