The Arkansas Legislature adjourned their budget session sine die on May 9. The legislature’s last meeting of the year was on May 2, but senators and representatives reconvened in Little Rock to close the session out a week later. In even-numbered years, the Arkansas Legislature meets for a brief fiscal session that may not meet for more than 30 days. The main priority of the fiscal session is to pass a budget. Overall, 179 bills and 109 resolutions were introduced.
Here's what you may have missed:
The Budget
The Arkansas Legislature passed, and Governor Sarah Huckabee Sanders (R) signed, a $6.31 billion budget for FY 2025. This budget represents a 1.76% increase over current general revenue spending. This amount is smaller than in recent years, which was a priority for Sanders.
The budget includes $25 million for FY 2024 to the Department of Commerce - Arkansas Economic Development Commission for financial incentives to companies locating a new facility or expanding an existing facility within the state if they hire and maintain specified levels of employment. It also includes $2.48 billion for public elementary and secondary schools, approximately $100 million of which will go toward supporting the LEARNS Act and Educational Freedom Vouchers, which were adopted last session.
The only state agency that was not funded by the budget is the Arkansas Game and Fish Commission. After passing the senate, the appropriation bill for the commission failed in the house. The legislature will have to go into special session to appropriate funds for the commission before the new fiscal year begins on July 1. This is the first time since the legislature instituted the practice of fiscal sessions in 2008 that a state agency appropriation has not been approved by the legislature.
Cryptocurrency
While even-numbered year sessions are typically reserved for budgetary discussions, legislators are authorized to discuss a limited amount of non-budgetary issues if both chambers agree to the bills by two-thirds majorities. This year the focus was on cryptocurrency. The legislature passed SB 78, which amends the Arkansas Data Centers Act of 2023. The bill requires digital asset mining businesses to abide by noise-reduction ordinances and techniques, including the usage of liquid cooling or submerged cooling. The same bill also prohibits foreign party-controlled businesses from holding any interest in a digital asset mining operations in the state. Another bill, SB 79, prohibits the operation of a digital asset mining business or businesses utilizing a blockchain network without being licensed by the state Oil and Gas Commission. Both SB 78 and SB 79 were passed with emergency clauses, meaning they are effective upon signature.
What’s Next
Before adjourning, the legislature voted on new leadership for the 2025 legislative session. Representative Brian Evans (R) was voted as the new House Speaker Designate. He has been the chair of the House Education Committee for the last two session and prior to serving in the legislature was a member of the school board for his town. Evans must be affirmed by the full house in January before officially taking over as Speaker next session. Senate President Bart Hester (R) has been reelected to the same position for the next session.
In November, both the senate and house will have elections. Eighteen (18) of the thirty-five (35) seats in the senate will be up for grabs while all 100 seats in the house will be on the ballot.
For questions on Arkansas’s budget or a possible special session, please contact Constantine Costidis at cec@stateside.com.
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