Arkansas legislature asks voters to continue a 0.5 percent transportation sales tax currently set to expire in 2023


On March 7, 2019, the Arkansas State Senate approved a proposed constitutional amendment that would make permanent a 0.5 percent sales tax. The tax was approved by voters in 2012 and set to expire in 2023 once certain transportation bond debt was repaid. As the state House approved the amendment on March 4, the Senate’s vote sent the proposal—House Joint Resolution 1018—to voters at the November 2020 election. The Department of Finance and Administration estimated that the continued 0.5 percent sales tax authorized by the amendment would generate $293.7 million per year in revenue. It would be allocated in the following way:
 
  1. 70 percent ($205.59 million) to state highways,
  2. 15 percent ($44.055 million) to county roads, bridges, and other transportation, and
  3. 15 percent to ($44.055 million) to city roads, bridges, and other transportation.
 
In the House, 45 Republicans and 22 Democrats voted in favor of HJR 1018; 29 Republicans and one Democrat, Rep. John Walker, voted against HJR 1018. In the Senate, 17 Republicans and eight Democrats voted in favor of HJR 1018; seven Republicans and zero Democrats voted against it.
 
Voters authorized the temporary 0.5 percent sales tax that would be made permanent by this amendment in 2012 through approval of Issue 1 (2012), which is now Amendment 91 in the state constitution. Issue 1 of 2012 authorized the 0.5 percent sales tax to be levied until the general obligation bonds in the amount of $1.3 billion for the construction of a four-lane highway were repaid (estimated to be in 2023).
 
The legislature also passed Senate Bill 336 on March 4. SB 336 raises revenue for transportation through a gas tax, a casino tax, and hybrid/electric vehicle fees. On Thursday, Hutchinson said, “With the Senate’s passage of HJR 1018 this afternoon and the legislature’s passage of the $95 million highway-funding bill earlier this week, the 92nd General Assembly has approved the largest and most comprehensive long-term highway funding plan in state history. Because of the passage of HJR1018, Arkansas voters will have the final word on funding for the construction and repair of the roads they drive each and every day.”
 
This was the first statewide measure certified for the 2020 ballot in Arkansas. The Arkansas legislature is allowed to refer no more than three constitutional amendments to the voters at a general election. Citizen initiatives are also permitted in Arkansas. So far, three initiatives related to redistricting have been cleared for signature gathering with proponents targeting the 2020 Arkansas ballot. From 1996 through 2018, an average of four statewide measures appeared on the ballot during even-numbered years in Arkansas.