Oct. 13: Budget Hearings transcript (Joint Budget)

Joint Budget Committee (Budget Hearings)

October 13, 2022

Actions Taken (click each to jump to that discussion)

Rice: 00:04:37.771 Members, we will get started with the Legislative Council Joint Committee Budget hearing. First up, we have a report from Special Language. And Representative Cavenaugh, I believe you’re going to give that report. You’re recognized. Wait just a minute. My screen’s not on here. Representative Cavenaugh, if you would hit your button one more time. You’re recognized to give the–

Cavenaugh: 00:06:07.830 Thank you, Mr. Chair.

Rice: The Special Language report.

Cavenaugh: 00:06:10.337 Thank you, Mr. Chair. The Special Language Subcommittee met on Tuesday, October 11, at 1:30 p.m. and reports the following actions: one, the subcommittee adopted the executive recommendations for the agency language listed in the report. Two, the next Special Language meeting will take place Wednesday, October 19. at 1:30 p.m. in Mac building A– I mean, B. And I move for adoption of the report.

Rice: 00:06:40.955 We have a question. Representative Milligan, you got a question on the report? Representative Milligan, do you have a question on the report? Okay, you were on the screen. Okay, do I have a second to adopt the report? All in favor, aye. Opposed? Special Language subcommittee report is adopted. We are now going to Department of Labor and Licensing if the Secretary will come on up, whoever you want to be here. And we’re going to have Miss Katie Walden’s going to give the report. So if you would punch your button and recognize who you are and who you’re with officially.

Bassett: 00:07:38.771 Good morning, Mr. Chairman. Daryl Basset, Secretary of Department of Labor and Licensing.

Rice: 00:07:44.749 Thank you for being here, Mr. Basset. And Katie, you’re ready to go. You’re recognized.

Labor and Licensing, Admin and HVAC Board

Walden: 00:07:51.019 Thank you, Mr. Chairman. Good morning, members. Katie Walden, Bureau of Legislative Research Fiscal Division. This morning I’m going to be going over the Department of Labor appropriation with you as well as the boards or commissions that you requested come back in Tuesday’s JBC meeting. So the first one we’re going to look at is the Department of Labor Administration Appropriation. It begins on page 176 of your manual. This is the administration and shared services section for the Department of Labor and Licensing. On page 176, you’ll see the minority contracts report, the employee summary, and the publications. The department appropriation summary is on page 177, and as you can see, this section is funded with existing fund balances and shared services transfers from the boards and commissions that they serve, as well as other divisions in the agency and special revenues. They have the two appropriations, one of which you already reviewed on Tuesday. It is the HVAC board. It was part of the spreadsheet that you all reviewed and voted on earlier in the week. The second appropriation that I’ll be going over with you is the shared services request. It is on page 181 of the manual. As you know, this appropriation is comprised of transfers from the various divisions of the Department of Labor, and it provides one central shared staff, an appropriation for shared costs, including finance, legal staff, human resources, and IT for the whole agency. They request a total of almost $3.5 million for each year of the biennium. This includes the transfer in of two positions, one from the accounting board and another from the Athletic Commission. Additionally, they request an increase of $74,000 in FY 24 and $81,000 in FY 25 in operating costs. And this is simply to provide for greater operational costs to the agency, including increases in mileage reimbursement, rising rent, and the cost of supplies. The executive recommendation provides for the agency request. And this is the administration and shared services appropriation, Mr. Chair.

Rice: 00:10:18.100 Thank you. Mr. Secretary, do you have any comments or are you ready for any questions? Okay. Members, do you have any questions? Co-chair Representative Wardlaw, you’re recognized.

Wardlaw: Thank you, Mr. Chair. Secretary, it was just a short period of time ago you were down here, and we were having a lot of shortfalls in different parts of Labor and Licensing. Have we been able to shore some of that up? And most of that was due to the shared services that were coming out. So what is that looking like going forward?

Bassett: 00:10:53.585 Thank you, Representative Wardlaw. We have been able to shore those up. We’ve been able to do a number of workarounds. And working with DFA and some members of this body, we’ve been able to shore those up. And we’re in good shape right now.

Wardlaw: 00:11:12.153 So there was no fee increases to do that? You were able to do it without going to the hardworking people?

Bassett: 00:11:18.066 Absolutely, sir. No fee increases.

Wardlaw: 00:11:19.593 Thank you.

Rice: 00:11:22.730 Thank you. Senator Hammer, you’re recognized.

Hammer: 00:11:25.414 Thank you, Mr. Chair. Over here to the right. Good morning. A couple of questions. The other day in here, we were looking at some of the boards and commissions that had some large balances and questions were asked. And we were kind of looking at if they were to carry a three-year average and then be able to return the amount that’s above that three-year average, maybe by suspending the fees that they are collecting, and return that back to the individual groups regardless of whatever they are– home inspectors, architectural board, whatever. So my question would be are there any plans to address the reserve funds regarding the boards where there are large amounts? Or what are the discussions around that?

Bassett: 00:12:09.238 Yes, Senator. And to the body, we recognize that a number of our divisions are carrying somewhat large fund balances and we are in the process of working with those boards in order to reduce those. We’re open to a number of different prospects in that regard. In some cases, we can actually reduce filing fees, but then, moreover, what’s probably going to be most effective is looking at suspending licensing fees for a period of time. And we’re certainly open to working with this body to that extent. Working toward a three-year operating balance, I think is something that is conducive to what we’re planning in our overall mission and I think it would be in keeping with efficiency, the kind of efficiency that we’re trying to create. So yes, sir, absolutely, we’re looking at those plans.

Hammer: 00:13:13.306 All right. We’d like to work with you on that. And may I have a follow up, Mr. Chair? The large funds that have been accumulated, do you think there’ll be resistance on the part of the boards that have those large funds to do something like what we just talked about? And what would be the rationale against doing something like we just talked about as opposed to just letting those reserves build up? Maybe some of them might have justification for those large reserves to be there. Some might not. And so how would you separate the two, or can you talk about that?

Bassett: 00:13:46.926 Yes, sir, I can. There were some of the boards, when we inherited some of the boards through transformation, some of the boards were actually accumulating large fund balances because they were trying to– some of them had anticipated actually building buildings and other facilities. And so those balances naturally escalated because they were stockpiling these funds. As now we’re in a different construct, Senator. They’re housed now within one building and so there is no longer the need to accumulate those kinds of funds. And so I would not anticipate any blowback from the boards. I would think that they would want to be collaborative, that they would look at utilizing those funds since they’re no longer needed for construction. They would look at those funds in a way that we can start returning some of those to the taxpayers in the State of Arkansas, the people that had paid those fees and had enabled us to amass those fund balances. And so as we go into this initially, I would not anticipate there being any recalcitrance.

Hammer: 00:15:07.326 Final thought, then. I’d like you to survey your boards and ask for justifications for why they feel they would need to carry balances beyond a three-year running average to operate their agency. And, if you would, put that out to your boards and ask them to submit why they feel that they would be justified in keeping anything beyond a three-year and let’s see what they say. Can you get that to us, please?

Bassett: 00:15:30.085 We’ll do that today, Senator.

Hammer: 00:15:31.754 Thank you. Thank you, Mr. Chair.

Rice: 00:15:34.488 Mr. Secretary, would we be able to have that by next Friday in council maybe?

Bassett: 00:15:40.999 You’ll have it by close of business tomorrow, Senator.

Rice: 00:15:44.081 Well, I mean, council would be soon enough.

Bassett: 00:15:48.142 Yes, sir, we’ll have that.

Rice: 00:15:49.198 Thank you. Going to Representative Wooten, you’re recognized.

Wooten: 00:15:54.005 Thank you, Mr. Chairman. Mr. Secretary, I’m looking over your personnel area and you have roughly 60 vacant positions. Of that, 34 of them are over two years old. Do you know the age? Are they three years? Have they been vacant three years? Have they been vacant two, five, six? How many years have they been vacant?

Bassett: 00:16:19.100 Representative Wooten, I’m not prepared to answer that question. We’ve gone over that but I didn’t bring that spreadsheet with me today. But I can say, sir, that we are looking at those positions that are aged and whether or not we actually need them. I think when you look at the totality of our budget you will understand that we’re operating very leanly and we really look at any additional hiring very circumspectly. But I don’t have that spreadsheet. I didn’t bring it today.

Wooten: 00:16:50.786 Can you supply that to us?

Bassett: 00:16:53.507 Absolutely, sir.

Wooten: 00:16:54.408 Okay. Also on the HVAC licensing board, I see where they had an actual of eight positions. They were authorized 11. But in the new budget, you’re asking for an additional employee. But are you giving up 2? Because it says 9. It goes from an authorized of 11 down to 9. But the 9 is one more than you had. So are you giving up those two positions?

Bassett: 00:17:26.892 Yes, sir, we are. HVAC has been one of those areas– excuse me– one of those areas where we’ve really struggled. We need people there to answer the phones. We’re trying to operate leanly. We’ve got the nine but we think we need at least an additional person there and so that’s why that’s in our budget.

Wooten: 00:17:52.888 But on page 181 in the Department of Labor and Licensing, you’re increasing from 24. Your actual is 24, your authorized is 24. But then in the new budget, you’re asking for 2 additional positions. Where are those coming from? Are they going to be new positions or are they within the structure?

Bassett: 00:18:17.657 They’re within the structure, not new–

Wooten: 00:18:19.434 Okay, you’re transferring.

Bassett: 00:18:20.773 Yes, sir.

Wooten: 00:18:21.153 So you’re using positions in other groups bringing it into that.

Bassett: 00:18:27.112 Absolutely. Absolutely. We’re just moving people around where we have authorized positions. We need to shore up our financial staff because we were kind of a little caught off guard as we inherited these 20-plus entities and we realized that we needed additional finance staff. And so we looked around and saw, well, where do we have positions that maybe we can move around in here? And that’s what we’re doing. We’re not asking for new. We’re utilizing the positions that we already have and we’re trying to hold on to some of the ones that are vacant just in case we may need to move them into maybe legal or finance. But legal and finance are the two areas that I’m really trying to shore up.

Wooten: 00:19:12.453 Okay. If you could age those two-year positions that are over two years for us to how many? How old are those positions?

Bassett: 00:19:22.286 I can do that.

Wooten: 00:19:22.933 The average and the individual. Thank you, Mr. Chairman. Thank you, Mr. Secretary.

Bassett: 00:19:27.472 Thank you, sir.

Rice: 00:19:28.363 Thank you. Senator Chesterfield, you’re recognized.

Chesterfield: 00:19:31.478 I move executive rec.

Rice: 00:19:40.979 I’m going to hold that just one minute. Let me-

Chesterfield: 00:19:42.549 All right. If someone else needs to ask, please, come back to me.

Rice: 00:19:47.428 Representative Deffenbaugh, you’re recognized.

Deffenbaugh: 00:19:50.687 Thank you, Mr. Chair. I was looking on page 180– I’m right here– I was looking at page 180 and the second dot says to transfer one position from the Arkansas Athletic Commission. So two quick questions on Arkansas Athletic Commission. Who are they and what do they do? I never heard of them.

Bassett: 00:20:27.596 What does the Athletic Commission do?

Deffenbaugh: 00:20:31.489 Yeah, who are they and what do they do? Yes, sir.

Bassett: 00:20:35.636 Well, we have a Athletic Commission. The Athletic Commission actually regulates MMA fighting. At one point, they used to regulate wrestling as well. What we have currently, one employee there. Actually, we have two, but we are loaning one from another department. And so what we’re doing is actually moving one position up to director, to a director position of athletics and so that– I don’t know exactly if I’m answering your question, but they monitor all of the fights that go on in the state, the MMA fights that go on in the state.

Deffenbaugh: 00:21:28.506 Okay. Thank you.

Bassett: 00:21:29.518 Okay. I hope I answered that question.

Rice: 00:21:34.416 We have different visions. This is item one. I have a motion for executive rec. I have a second. Second. All in favor, aye. Opposed. Thank you for that. And Mr. Secretary, I’ll let Miss Walden go into item two, labor and licensing division of elevator.

Labor and Licensing operations, Boiler Inspection, and Electrical Examiners

Walden: 00:21:55.701 Thank you, Mr. Chairman. The Division of Labor request begins on page 239 of the manual. You’ll see on that first page there’s the minority contracts report, the employment summary, and the list of publications. The total division appropriation summary is on page 240. And as you can see, this division is funded with general revenues, federal revenues, special revenue from licensing fees, and cash funds. The agency has six total appropriations and the request total is $5.7 million for each year of the biennium. They also have 69 positions authorized. The first appropriation begins on page 242. It’s detailed there. This is their operations appropriation. It is funded with general revenue, as well as special revenue fees collected by the Elevator Inspection program. The agency requests a total appropriation of $2.4 million for each year. This is a continuation of previous levels, and the only increases are salary and matching increases and rate adjustments that occurred in a previous biennium. And the executive recommendation provides for the agency request. The next appropriation is Boiler Inspection. It’s on page 244. This is funded with special revenues collected by the Department of Labor for permits and inspection of boilers and boiler manufacturers in the state. The agency request is for around $860,000 for each year of the biennium and there’s no change level request for this. It’s simply the salaries and matching adjustments that I mentioned in the previous appropriation. And the executive recommendation provides for the agency request. The federal program’s appropriation is on page 246. This appropriation is 100% federally funded and includes grant funding from OSHA as well as mine safety and health consultation and training. The agency requests a total of $1.4 million for each year of the biennium. This request includes salary and matching adjustments that occurred in the previous biennium, but no other change labor requests are associated. and the executive recommendation provides for the agency request. The fourth appropriation is the Board of Electrical Examiners. It’s on page 248. This appropriation provides for the licensure and certification of electrical apprentices as well as electricians in the state. Funding comes from examination and license fees. The agency requests over $690,000 for each year of the biennium. You’ll notice a reduction of $20,000 each year in operating costs, and they state that this is to better align with their anticipated expenditures. The executive recommendation provides for this request. On page 250, you’ll see wage and hour cash appropriation. This cash appropriation is a pass-through that the agency utilizes to disperse cash funds collected from employers when it is determined that an employer owes compensation to an employee resulting from a wage and hour investigation. The agency requests to continue this appropriation at $200,000 per year. And the executive recommendation provides for the request.

Walden: 00:25:48.530 The final appropriation is on page 252. It is the seminar and conference expenses appropriation. It provides for the costs of hosting conferences and seminars for industry participants in the state. It’s funded with cash fees collected from conference participants. And they request to continue the existing appropriation at $48,000 annually. And the executive recommendation provides for the request. Thank you, Mr. Chairman.

Rice: 00:26:15.948 Thank you. And we’re ready for questions. Representative Dotson, you’re recognized.

Dotson: 00:26:23.399 Thank you, Mr. Chair. On page 244– back to your right– the boiler inspector regular salaries and operating expenses line items, both of those were– you’re asking for a lot of appropriation above what the actual expenses were the last year. Is there a reason why those are so much? Are you anticipating increase in headcount, or–? I know you’re asking for one additional position there.

Bassett: 00:26:59.890 Absolutely. Absolutely. We’ve had tremendous increases in that area. And, sir, we think we need that in order to keep up with the inflow. We’re operating very leanly in that area. And we just thought that that was a modest increase, but we absolutely need that, Representative Dotson.

Dotson: 00:27:22.576 Okay. And then on page 248. Same two line items. But it looks like your appropriation request was for almost three times what your expenses were, and your salaries are more than double what your expenses were in the previous year, adding just two out of– going from seven to nine headcount.

Bassett: 00:27:56.747 Yeah. Electrical is an area– as a matter of fact, I just talked with– I’m sorry, I just talked with– I’m sorry, please excuse me. I just talked with the Senator this morning with regard to an issue with our electrical examiners. Prior to transformation, we had 15 positions in here before we inherited them. And they were taken down significantly. We’re trying to build electrical examiners, that section, back up. And we’re not trying to do it necessarily by exponentially increasing the number of employees, but we do need more people there. I constantly get, Representative Dotson, questions from the public, we’re calling you, we can’t get answers, no one’s answering the phone. That’s because we only have one person there, okay? And if they take a coffee break or they go away, then we have those lapses. We’ve got to shore up electrical examiners. That is a vital part of what we do.

Dotson: 00:29:08.947 And is this the area or the category that does the inspections for solar inspections and connectivity and all that?

Bassett: 00:29:19.306 Yes, sir.

Dotson: 00:29:20.627 Definitely know that’s growing.

Bassett: 00:29:22.450 Yes, sir.

Dotson: 00:29:24.097 Are you sure you just need two additional and not more than that?

Bassett: 00:29:26.433 Well, we just thought we could get away with two. I don’t want to ask–

Dotson: 00:29:31.699 I get calls about that all the time, so.

Bassett: 00:29:32.765 I didn’t want to ask for any more than that.

Dotson: 00:29:34.997 Thank you.

Bassett: 00:29:35.854 I thought we need at least two.

Dotson: 00:29:37.479 Thank you.

Rice: 00:29:40.358 Representative Beck, you’re recognized.

Beck: 00:29:42.711 Thank you, Mr. Chair. My question is actually on the same category on 248. The concern is that– I understand they’re two new positions, but the salary increase is not reflective of the increase in the number of positions. It’s much higher. So the question would then be is– I don’t want to push. It might be that you’re having trouble recruiting people and you’re increasing salary. I don’t know why, but it’s a much larger increase in the percentage in terms of salary than it is in the percentage in terms of positions. So that’s my question concerning– and also, the operating expenses. I mean, Representative Dotson brought this up. But we were talking, “Okay, they’re going to decrease over the biennium, they’re decreasing $20,000 in their operating expenses.” Well, yeah, but you more than quadrupled almost your request. So I don’t quite understand that.

Bassett: 00:30:51.043 It’s a valid question, Representative Beck. Let me tell you why we’re doing that. What we’re doing is we’re trying to save money operationally. And so we’re actually reducing our cost operationally. But we’re having a dickens of a time recruiting people at this caliber to actually come in and do these inspections. We’re competing against the private sector. And what we’ve done– and what we’ve discovered as we try to put these positions out and interview, we just can’t get people. I mean, we get qualified candidates in. Matter of fact, we had a good candidate come in, and we thought that we had him on Friday. And then I came in on Monday and found out that he had taken another position. And so that’s where we’re just in the competition out here. And so that’s why the increase in the salary. We’re trying to attract some good people. And we’re really pulling people from business and industry. Those are the people that we need to actually come in and be able to hit the ground running without any training. We’re having a dickens of a time getting qualified people in at the salaries that we’ve been offering. So we’re trying to offer a little bit more in order to attract those folks and that’s where that is a good question, but that’s what we’re facing.

Beck: 00:32:11.475 But I just want to go back to the increase if– I’m sorry, Mr. Chair. The operating expenses is– your actual is $34,200. You’re asking for $112,000. And then you’re cutting– oh, excuse me, $131,000 or $132,000 if you round it up. But then you’re saying, Okay, I’m cutting it down over the ’23-’24. So why would you ask for that $20,000 that you’re going to eventually to be, according to this budget, taking back out?

Bassett: 00:32:53.590 We–

Beck: 00:32:53.760 Or am I reading it wrong?

Bassett: 00:32:55.072 Yeah. No. We–

Beck: 00:32:56.089 I mean it looks like you’re increasing it this much. Okay, but we’re going to give you back this much. So I would say, why would you just increase it to that amount and not give it back?

Bassett: 00:33:04.296 It’s a valid point, but that’s our rationale.

Beck: 00:33:07.735 All right.

Bassett: 00:33:08.280 That’s our rationale.

Beck: 00:33:09.818 Thank you.

Rice: 00:33:12.789 Representative Cavenaugh, you’re recognized.

Cavenaugh: 00:33:15.794 Thank you, Mr. Chair. My question is going to be on page 244 on the boiler inspection. And I’m over here to your right. Representative Cozart is blocking me, so I’ll scoot over so you can see my face. My question is on the fund balance. If you look, it just keeps increasing. It doesn’t decrease at all because you’re collecting more in special revenue than what your actual expenses are. So and my understanding is you had said that this was an area where you’re seeing a big increase?

Bassett: 00:33:55.223 Mm-hmm.

Cavenaugh: 00:33:56.578 But in your projections, you’re not showing any increase in your special revenue. So as that continues to go on, if it’s a big increase, should that not be increased for what you’re expecting to be getting in? Because in reality what’s happening is that that excess funding is just keeps growing.

Bassett: 00:34:20.382 Yes, ma’am. Yes, ma’am. It will continue to grow. The excess funding will continue to grow. And I think that’s kind of akin to what I was speaking to Senator Hammer about. How do we deal with the increases? Because in this particular case with boiler, as you know, they came over from the Health Department, that number is going to continue to grow. Question is, what do you want us to do with that excess? Because you can see what our annual expenditures are. If you’re of a mind that that number is growing beyond where it needs to grow, what I said earlier still stands in my answer to this question. We’re certainly open to any suggestions that would mitigate that number, but that number is going to continue to grow here, especially in the boilers section.

Cavenaugh: 00:35:13.648 Okay. Well, the reason I ask is because when you look at what your agency requests and the executive recommendation is, you all don’t seem to project that increase in revenue. So we don’t get a real true picture of what you’re projecting your funding to be, your excess funding. It shows it’s going down and in reality it’s going up.

Bassett: 00:35:36.885 Well, it’s going to go up because, I mean, obviously it’s very difficult to– it’s very difficult to project where those fund balances are going to go because we never know how many licenses are going to come in, how many are going to come in. So we’re very conservative in that approach. But what I said was, and it still stands true, that number is going to go up. That fund balance is going to continue to increase as it has over the last two and a half years. The question is, what do we do with it. I mean, do we mitigate it by giving it back to the licensees?

Cavenaugh: 00:36:13.100 Yeah. I just want to– I just want to interrupt. You’re missing what I’m trying to point out is if someone’s looking at a budget and a projection, and we’re looking at a fund balance, you’re projecting your fund balance is going to continue to go down. If you look at what the agency request and executive recommendation is, it shows your funding balance to continue to draw down. But in reality, it’s going up because you’re not using true figures on your revenue. And from someone who’s trying to budget, what I’m asking is, why don’t we use truer figures on what we think our real budget’s going to be so we can can, as we move forward, figure out how to give these funds back to the people that paid it so we know how much you really need.

Bassett: 00:37:04.797 Okay.

Cavenaugh: 00:37:05.718 That’s what I’m asking is, can we not use truer figures when we’re looking at these numbers so we know what that fund balance is going to be? You and I both agree it’s going to go up. You and I both agree it needs to go back to the people that paid it. But your report shows it’s going down. If you could, I mean, from someone that’s trying to budget, we have to have the real numbers is all I’m saying. If there’s a way that we could give those numbers to us, it makes it a lot easier.

Bassett: 00:37:33.826 Okay. I’ll commit to doing that.

Cavenaugh: 00:37:35.858 Okay. Thank you.

Bassett: 00:37:36.660 Yes, ma’am.

Rice: 00:37:39.054 Senator Hammer, you’re recognized.

Hammer: 00:37:41.635 Thank you, Mr. Chair. Go back to the discussion about the Board of Electrical Examiners. What is the average salary for who you’re trying to hire for that makes it difficult to retain them? Do you know right off the top of your head?

Bassett: 00:37:55.613 No, sir. And I’m not going to insult you by trying to say that I do.

Hammer: 00:38:00.391 All right. Well, then let me ask you this, as it would apply to all the other areas, is it the same scenario in all the other areas as well? Or is it unique to just the Board of Electrical Examiners?

Bassett: 00:38:12.285 It’s the same across the spectrum, and not just with the Department of Labor. Our state employee salaries are just lower than the market rates. And so we always have to deal with how do we get qualified people. And now we have some options. We can do some 10%, so we can do some secretary discretion. But we’re always in that competition with the outside sector, especially in our area, because we have 24 different divisions, and all of them are professional areas. And so we’re always competing with the private sector for employees.

Hammer: 00:39:00.430 And what is the reaction you would get from all the individuals associated with the different boards as far as the industries that they serve, that if we were to offer more competitive salaries in order to keep the staff and reduce the turnover, what would be the reaction from the industries that you serve if that was to happen?

Bassett: 00:39:21.575 I would hope they would be cooperative, but when you’re dealing with 24 different entities and 24 different boards, 24 different chairman, I would hope that they would be cooperative, but I can’t say that I would have 100% agreement in that area.

Hammer: 00:39:38.768 All right. Thank you. Thank you, Mr. Chair.

Rice: 00:39:41.401 And the last one I currently have on the board, Representative Wooten, you’re recognized.

Wooten: 00:39:46.029 Thank you, Mr. Chairman. Mr. Secretary, I want to ask you some questions about some trends that I see in your total budgets. When I started looking at them, and let’s just use the boiler inspections. On page 244, your average salary, this actual is $40,000. Your new one with adding a position– you’re asking for $100,000 in more money. And the average comes out to be $46,000. So are you giving a $6,000 a year raise to the other employees?

Bassett: 00:40:26.266 Let me call my CFO.

Wooten: 00:40:30.257 I mean, this is– the same trend I see here, I’ve seen in several others. And while he’s coming up, what is the percent of the payroll matching? What are they using? Because it jumps from– it jumps $50,000. If I’m looking at it correctly– we use generally 28% as the matching. And these look like 35 to 30, and then it jumps from 35% personal services matching– it jumps from 35 to 39% in the new budget.

Rice: 00:41:27.396 Sir, if you’ll identify yourself for the record.

Cain: 00:41:31.210 Tyler Cain, CFO, Department of Labor and Licensing. Representative Wooten, the percentage that we used was around 37% like you said.

Wooten: 00:41:43.228 37?

Cain: 00:41:44.005 Yes sir, and that’s just an estimate.

Wooten: 00:41:47.425 Okay. Well, what about the $100,000 increase in salaries? If I’m looking at that correctly, that means that all your other employees– you’re going to hire a new one, probably– the average is going to be $46,000. And the average in the current ’21-’22 year was 360, which is $40,000. And I see this throughout most of your budgets. So what are we doing?

Cain: 00:42:25.823 Yes, sir. Representative Wooten, what we tried to do is establish a good pattern in the hiring process in terms of how we are trying to get good candidates that would apply for these positions. Again, the Secretary has already stated earlier about wages, and we’re trying our best to hire staff that we can get in that we don’t have to do a whole lot of training, that perhaps we can get good applicants that will come forward and be part of our agency. And these increases that you see represent the cost of goods sold, cost of living. We’re trying to establish a good pattern that we can go forward with, and some of the numbers might be– as you say, may be a little bit more than anticipated. But we don’t know what the economy is going to be like, whether we get another governor’s COLA. These things are happening around us. And so we’re trying our best with our numbers to get a good dollar amount for our staffing.

Wooten: 00:43:30.774 Well, I understand the market situation and that type of thing, but also looking at– I see that’s $100,000 that they’re jumping. I want everybody to make a good wage. And I point this out because this is an example of what you get into when you don’t adequately pay to start with. It’s like bringing a new preacher into the church. And the old one made $35-40,000. Your new one comes in, he wants $55,000. Your membership says, “Well, he just came for the money.” That’s the same kind of deal. So we need to keep pace, but on your operating expenses– and this is the same procedure. So $46,000 on the boiler maker– or the inspectors. So $46,000. You budgeted $201 and then you’re coming back with $201,000 again when you only use $46,000 in operating expenses. And I see this throughout the budgets.

Cain: 00:44:40.141 Yes, sir. And that’s primarily because during the COVID time our costs were lower because our inspectors and enforcers could not go out and travel, mileage. Our mileage went from 42 cents to 52. We had other cost of goods sold. The gasoline prices just skyrocketed. Right now we’re talking about buying vehicles in place of reimbursing employees for using their own vehicles. We have other operating costs. Our rent has went up a dollar a square foot. These are costs that are happening right across the board on all our operating– for shredding, office supplies, all these cost of goods sold are hitting us. During COVID, these agencies did not have these anticipated costs. Now they’re there. And the reality is that we don’t know what the next two years are going to bring. Right now gasoline prices are fluctuating, and, again, inflation is happening all around us. We talked earlier about salaries. These salaries that we’re paying our state employees– I’m trying to get– we’re trying to get good applicants, as the secretary stated, to come forward to be part of our agency. And recruiting, you know, Representative Wooten, is hard to get these good applicants to come forward when you got competing other agencies giving 10 and 15 percent discretionary pay. I just had a situation earlier. I had to do some things with the staff that I want to keep. I had to compete with another state agency. So these things are occurring, sir. The costs are not going down here.

Wooten: 00:46:11.229 Thank you, Mr. Chairman. Thank you, Mr. Secretary. Thank you.

Cain: 00:46:16.078 Thank you, Representative Wooten.

Rice: 00:46:17.167 Thank you. Senator Chesterfield, recognize you. I have a motion for executive rec. Do I have a second? All in favor, aye. Opposed? Thank you, gentlemen, for your testimony.

Bassett: 00:46:33.510 Thank you, Mr. Chairman, Members of the committee.

Cain: 00:46:35.245 Thank you.

Workers Compensation Commission

Rice: 00:46:35.683 And our next up is Labor and Licensing Workers Compensation Commission, and I believe we’re going to have Director Greenbaum coming up. Miss. Walden, you are recognized to proceed.

Walden: 00:47:00.173 Thank you, Mr. Chairman. The next appropriation we’ll review today is the Workers Compensation Commission appropriation. It begins on page 274 of your manual. The first page includes the minority contract report, the employment summary, and the publications. The department appropriation summary is on page 275. The Workers Compensation Commission administers and enforces the Arkansas Workers Compensation Law. They have a total of five appropriations. They are funded by a 3% premium tax on Workers’ Compensation insurance premiums, as well as cash funds from seminar receipts and investment accruals. The total appropriation for the commission is around $33.6 million dollars for each year of the biennium. They have 105 authorized positions and two extra help positions. The first appropriation is detailed on page 277 of the manual. This is the refunds and claims. This appropriation is funded with the death and permanent total disability program. The appropriation request is to continue this appropriation at $21.5 million dollars for each year of the biennium, and the executive recommendation provides for the agency request. The next appropriation, and the only one with change levels, is on page 278. This is the administration appropriation. This is funded with the 3% tax levied on insurance premiums and interest earnings and it provides for all the operating expenses, salaries, and capital funding for the commission’s two state offices. They request around $11.4 million dollars for each year of the biennium, and the increase provides for the discontinuation of two positions that were vacant, as well as salary and matching rate adjustments that occurred in the previous biennium. The executive recommendation provides for the agency request. On page 281, you’ll see the second injury claims appropriation, also funded with premium tax revenues and interest earnings. The agency requests for the appropriation to continue at $500,000 annually, and the executive recommendation provides for the agency request. Page 283 is their seminar, cash, and treasury appropriation. Funding for this appropriation comes from annual conference fees that the commission hosts for interested companies, attorneys, and individuals. The agency requests to continue this appropriation at $140,000 annually, and the executive recommendation provides for this request. The final appropriation for the Worker’s Compensation Commission is the building repair appropriation. This is funded using those insurance revenues, and it provides for the maintenance, renovation, equipping, and construction of their two offices, one in Little Rock and one in Ft. Smith. The agency requests to continue the appropriation of $150,000, and the executive recommendation provides for the agency request. Thank you, Mr. Chairman.

Rice: 00:50:41.018 Thank you. I have a request from Representative Cavenaugh. You’re recognized.

Cavenaugh: 00:50:46.555 Thank you, Mr. Chair. This is just a question– well, I’m just going to ask it. So, we’re going to deal with page number 276 and 277, which is going to be the refunds and claims. In the explanation for this, it brings out that in the 3rd Extraordinary Session of 2016, Act 5 was enacted by the Arkansas Legislature, which provides that no claim shall be paid to the death and permanent disability trust fund after June 30, 2019. Then the current premium tax rate of 3% will be reduced to 1.5% upon the final payment of the liabilities of the trust fund. So we have an excess of $84 million in this fund is what it looks like, and we’re not adding any more money to that trust fund is what I’m understanding. Is that correct?

Greenbaum: 00:51:53.766 That’s correct, Representative Cavenaugh. But that death and permanent disability fund has an unfunded liability. So we’re still collecting the 3%, which is 1.5 percent going to the Death and Permanent Total Disability Trust Fund, and 1.5 percent to operations. But there are well over a thousand claims in that trust fund. And until all of those are paid, we have to continue to collect that money and put the– put it into fund that unfunded liability.

Cavenaugh: 00:52:44.853 Okay. And do we know– actuarially, have we looked at how long we think we’re going to have a tail out there on these claims?

Greenbaum: 00:52:54.537 We know that we still– I think that the figures show that we have about a $90 million unfunded liability. But that’s been reduced by some $15 million in the last six years.

Cavenaugh: 00:53:14.088 So if we had $90– you’re saying we have $90 [million] right now, or we have $90 minus the $15?

Greenbaum: 00:53:20.882 We have $90 million currently.

Cavenaugh: 00:53:23.554 Okay. We’re going to use this money and this trust fund to pay those claims down, and then when all those claims are paid out, this trust fund goes away.

Greenbaum: 00:53:38.717 That’s correct.

Cavenaugh: 00:53:39.713 And if there’s any excess funds in that, where will it go?

Greenbaum: 00:53:45.044 Well, we don’t anticipate there’ll be any excess funds, but the– if there were any excess funds, again, they would reduce the premium tax dollars, which are currently 3%. And the cost of doing business is perhaps the lowest in the nation with regard to the cost of doing business for the employers. We do have excess in– I’m not sure what question you’re asking, but–

Cavenaugh: 00:54:23.331 Well, I’m just saying if, by chance, there happened to be, after all claims are paid out, an excess in this trust fund, do we have a mechanism that it should go somewhere else?

Greenbaum: 00:54:34.250 No, ma’am.

Cavenaugh: 00:54:35.128 Okay. Thank you.

Greenbaum: 00:54:38.361 And I did misspeak with regard to– I’m looking at my numbers. They had an unfunded liability in the Death and Permanent Total Disability Trust Fund of $131 million in 2015. And that’s been reduced to $106 million at the end of 2021.

Rice: 00:55:03.172 Thank you for that. Seeing no more questions, do I have a motion for executive rec? I have motion and a second. All in favor aye. Opposed? Executive rec passes. Members, on the next five, those are ones that we requested Tuesday. And I think Miss Walden’s going to cover all of those. You’re recognized.

Appraiser Licensing

Walden: 00:55:29.304 Thank you, Mr. Chairman. The first board that you requested to come back is the Appraiser Licensing and Certification Board. Their appropriation is on page 188. They maintain a system for licensing and regulating state-registered licensed and certified appraisers in the state. They have four positions. Operations are funded with cash revenues, as well as a federal grant. The department’s appropriation summary is on page 190 of the manual. As I mentioned before, you can see the federal revenue, cash funds, and they also have some fund balances. The total request for each year of the biennium is around $645,000. The first appropriation for your review is on page 192. This is the appraisal grant appropriation. During the last biennium, the appraisal board received a federal grant for three years. And this is to expand their services. It’s to convert all of their paper documents into digital format. It’s to provide greater education. And so the agency requested the items that you see on page 192: $80,000 in operating expenses, $21,000 in conference and travel, $14,500 in professional fees, all for the implementation of this grant program. And the executive recommendation provides for the agency request. The next appropriation for your review is on page 194. This is their cash operations appropriation. And it provides for the licensing and regulating of real estate appraisals in the state. The total appropriation each year is for about $528,000. And these totals include salary and matching rate adjustments that occurred in the previous biennium, and there are no other change level requests. And the executive recommendation provides for their request. Thank you, Mr. Chairman.

Rice: 00:58:02.608 I’ve got a couple of questions. Representative Springer, you’re recognized. Does the agency want to address anything first?

Cain: 00:58:14.443 No, we’ll wait for you, Mr. Chairman.

Rice: 00:58:17.589 Representative Springer, you’re recognized.

Springer: 00:58:20.358 Good morning. Thank you, Mr. Chair. On page 194, I noticed that there is an increase by one in one position from three to four. Could you tell me what position that individual will hold and at what salary?

Peoski: 00:58:38.067 Identify myself? Oh, yes, ma’am. My name is Diana Peoski. I am the director of the Appraiser Licensing and Certification Board. Really, ma’am, what that is, is that we’ve always been appropriated for four positions, but we were unable to fulfill our investigator position. So there’s really not a change. I just had three employees, and then so that we would not lose that position, we were able to fill it finally by making a change. So we’ve always had four; we just were having three employees for about a year or so during the COVID pandemic. So we’re back now to being fully staffed at four positions. So we really did not add a position. It was just one that had been vacant.

Springer: 00:59:25.433 Follow up, Mr. Chair.

Rice: 00:59:26.750 Go ahead.

Springer: 00:59:27.196 What are those position titles being held by those individuals?

Peoski: 00:59:31.712 The position titles are our investigator position that is notated in here was cross-graded to a business operations manager. Then we have our executive assistant to the director, and then I have an admin 3 position.

Springer: 00:59:46.396 Okay, so one investigator?

Peoski: 00:59:48.205 We have one investigator now. We have changed to a contract investigator model. It’s much more efficient for the board, and it’s currently being funded by our grant monies. So we are having an investigator that– a contract investigator at no charge of our funding.

Springer: 00:00:13.457 All right, thank you.

Rice: 00:00:17.689 Senator Hammer, you’re recognized.

Hammer: 00:00:20.261 Thank you. I’m also looking at page 194. Your shared services transfer is taking a significant jump. And then I get to looking at some of the other ones and I noticed that they’re taking a jump too. Some are down a little bit. Can you tell me why the jump in the shared services? If I’m reading it right, it’s going from $16,682 up to $40,000.

Basset: 00:00:50.904 I’m going to need to get my CFO, but what that is, that reflects an increase in cost, and I want my CFO to outline exactly where those costs were. You’re going to see that across the department and so we’re going to go ahead and answer those questions.

Cain: 00:01:25.872 Good morning. Tyler Cain, CFO. In regards to the shared service costs. IT. We had a one-time shot on our IT costs that we had initially started with. It was free. Each one of these budgets is going to have to pay about an additional $20,000. I’m sorry. There was an increase in the IT costs. Each one of these budgets is going to go up proportionally for the shared services cost for those IT charges.

Hammer: 00:02:11.332 What was the– may I, Mr. Chair? Thank you. I vaguely remember that contract coming through a couple of years ago, I think. What was the total cost of that contract? It started off free, but nothing’s free. So what’s it costing us now?

Cain: 00:02:29.613 Yes, sir. It’s significant. I can’t think on the top of my head right now. The total cost was like for $400,000-500,000. It’s quite significant.

Hammer: 00:02:38.554 And that’s across the board to all the agencies?

Cain: 00:02:41.621 Yes, sir.

Hammer: 00:02:42.150 Okay. Is that what allowed us to go from paper to electronic? Is that what that cost was for?

Cain: 00:02:48.671 Yes, sir, that’s correct.

Hammer: 00:02:50.008 Okay. So is all the increase in the shared service transfer related to that or there are other costs associated with that?

Cain: 00:02:58.571 Yes, sir. As I mentioned earlier, the rent went up.

Hammer: 00:03:02.337 Okay. I’d like to ask the board folks a direct question, if I could. I’m sorry, I didn’t get your name, ma’am.

Peoski: 00:03:09.567 My name is Diana. Yes, sir.

Hammer: 00:03:11.317 And your role with the board is what?

Peoski: 00:03:12.931 I am the director of the Appraiser Licensing board, sir.

Hammer: 00:03:16.337 I know you got a lot of people standing around you and sitting besides you right now, but I’d like to know straight up your opinion about shared services as it’s affected your particular entity. Has it produced benefits that you thought it would prior to it going in and where you are right now with it being in place?

Peoski: 00:03:33.665 Yes, sir. I’m happy to answer that question. From my perspective as the director of the appraiser board, shared services has definitely benefited us. There’s a lot of good things to be said about having someone that can answer a question or help you with something on site. If I have a financial question, I can go to the finance department. If I have a legal concern about perhaps an FOI that I’ve received I can walk down to the legal department and get someone that can help me on the spot. If not, they know someone that can help me. So from our perspective, sir, it’s definitely worth the money that we have paid so far.

Hammer: 00:04:14.959 So you don’t feel it’s put a undue burden on your budget. Even though you’ve got a pretty hefty surplus balance, you don’t feel that it’s put a strain on your budget?

Peoski: 00:04:24.449 No, sir, I do not.

Hammer: 00:04:25.835 Okay. All right. Thank you. Thank you, Mr. Chair.

Rice: 00:04:28.673 Representative Wooten and then Representative Beck. Representative Wooten, you’re recognized.

Wooten: 00:04:32.930 Thank you, Mr. Chairman. When you talk about shared services, the last time we went through this, that was a central office expense. Is that what we’re talking about? Okay, I figured that. Let me ask you this. This is directed to you. How do you arrive at what you charge each agency? Is it based on workload that you have to perform for them? Do you do it on a percentage basis, or do you just say, “We’ve got 20 agencies, and it costs us a $100 million,” so you divide that by 20 and that’s what they’re going to pay? How do you arrive at your cost for your central office?

Cain: 00:05:12.946 The answer–

Wooten: 00:05:14.511 And does that include, does that include the secretary’s. salary and all of your support staff to him? Is that the total central office expense that you’re dividing among the agencies?

Cain: 00:05:30.628 Yes, sir. It’s split two ways, sir, Representative Wooten. First, there’s the admin shared services cost. Those costs are done through a approved federal cost allocation plan where we use a percentage based on a percentage of the total salaries of that agency and multiply that percentages for the salaries and fringes. Then we have what you call direct cost. These are your direct overhead costs, shared services– what we call shared services. In terms of the rent, the building that we share, it’s based on an allocation of square footage. We charge the amount square footage that that agency uses. The other costs are actual costs, such as, I’ll say, if they have a bill that comes in, we’ll pay that bill, and we’ll split it between all the agencies based on their percentage share, such as office supplies, and we’ll allocate based on cost center. But all the costs that comes to that agency has a basis of allocation. As I said earlier, admin is done through an indirect cost allocation plan. The direct costs are based upon square foot. Rent is based on square footage. The office supplies are based on utilization, how much they use. And then it’s cost back to them. I’ll say it’s all shared equitably. It’s all fair. It’s all reasonable. I try my best as CFO to make sure that every cost comes across my desk has that equity in it and that we all share it together.

Wooten: 00:07:09.021 Okay. So it’s on forming a basis based on percentage of workload that your office has relative to the formula that you just mentioned.

Cain: 00:07:21.334 Yes, sir. The admin side of the house you were talking earlier about, salaries and fringes, that’s based on an indirect cost allocation plan, a percentage. We’re happy to share it with you. And then the direct cost such as rent, shredding, office supplies, they’re done on utilization. And, again, rent is done on square footage.

Wooten: 00:07:42.179 Okay, one more question, Mr. Chairman. I shouldn’t put it like that. On the expenditures of these agencies, they all come in to you and you look at all of them?

Cain: 00:07:57.289 Yes, sir.

Wooten: 00:07:57.795 Your staff review all the expenses for all the agencies that you have?

Cain: 00:08:02.318 Yes, sir.

Wooten: 00:08:03.346 Okay. All right. Thank you, Mr. Chair.

Rice: 00:08:06.410 Representative Beck, you’re recognized.

Beck: 00:08:11.125 Thank you, Mr. Chair. And I apologize. I’m going to take us back just a little bit because I lost something. So we were talking about the increase in the shared services. And in answer to Senator Hammer’s question, we said that it was an IT thing and that we were going paperless, and that was kind of the cost of that. All right. So I really have two questions. The first question is, sort of an IT thing going paperless, you would think, okay, we’ve got to pay a lot of money this year and maybe next year, and then we’re paperless, and there’s a savings associated with going paperless. And maybe not. Maybe it’s being able to speed up things, better customer service, that type of thing. Maybe that’s the answer to that. So my first question was, do we anticipate that going paperless will actually end up netting us some savings in the future? And then the second question is this. If the increase is associated to the IT expense in going paperless, why does it continue on all the way up and through 2025? Is it going to cost– is it going to take us that long to get there? Or is this just an ongoing cost that’s always going to be there?

Cain: 00:09:35.405 Yes, sir. Yes, sir. IT is not going to go away. Yes, sir.

Beck: 00:09:41.896 Okay. So this is IT. Just a quick follow-up. So this is cost of IT going paperless. It’s not a transition cost. It’s a constant cost that’s going to be there. So then, my first question then was, do we anticipate better service? Do we anticipate lower– is there an operating cost somewhere else that’s going to go down, what is it, about twenty-something thousand?

Basset: 00:10:08.042 Absolutely, sir. That’s the main emphasis for us trying to get paperless and to get out of notepads and trying to do things paperless. It’s not only going to create, what we hope, efficiencies within our office, but it’s going to mean a world of difference to our constituencies out there because they’re going to be able to now, hopefully, go online and do that, rather than traveling to our offices and waiting in line. We anticipate huge efficiencies here, not just in-office but for the citizens of Arkansas who are going to be able to– it streamlines the whole licensing process. Is it going to be a paved road getting there? No. We’re going to run over some gravel and maybe some blacktop a little bit before we get there. But yes, sir, we anticipate long-term, this is where we need to be.

Beck: 00:11:13.280 And just to make sure I understand your answer, you’re saying that the additional cost is gained efficiency, not actual cost savings of going paperless.

Basset: 00:11:26.523 In this case, no.

Beck: 00:11:27.770 Okay.

Basset: 00:11:28.022 In this case, no. Initially, yes, it’s going to cost us more to get there. But in the long term, we’re going to have those efficiencies, and it’s going to more than justify the cost that it’s taking for us to get there. That’s what I’m saying.

Beck: 00:11:42.651 All right. Thank you.

Rice: 00:11:45.849 Senator Chesterfield, you’re recognized.

Chesterfield: 00:11:47.320 I move executive rec.

Home Inspectors

Rice: 00:11:49.908 I have a motion for executive rec. I have a second. All in favor, aye. Thank you. Miss Walden, you’ll be presenting the Home Inspector Division. Whoever needs to come up for that, if you’ll proceed up. Miss Walden, you can proceed.

Walden: 00:12:24.490 Thank you, Mr. Chairman. The Home Inspectors Registration Board request begins on page 233 of your manual. The purpose of the Home Inspector Board is to protect the public against home inspection fraud, and they license qualified home inspectors across the state. They also hear and resolve disciplinary matters. The board is composed of seven members appointed by the governor. The department appropriation summary is found on page 234 of the manual. You’ll see they have two appropriations. And funding is derived from special revenue fees that they collect from license fees and renewals, as well as fund balances. You’ll see that their total request for the department is $86,000 around each year of the biennium. They have one authorized position.

Walden: 00:13:14.506 The first appropriation for your review is the operations appropriation. It’s detailed on page 236 of the manual. They request about $77,000 for each year of the biennium for this appropriation. And the increases that you’ll see are just continuing salary and matching adjustments that occurred in the previous biennium. There are no other change-level requests. The executive recommendation provides for this request. The second appropriation is on page 238. It is for a public awareness campaign. The agency request to continue this appropriation at $10,000 annually. And the executive recommendation provides for the agency request. Thank you, Mr. Chairman.

Rice: 00:14:03.489 Thank you. Welcome. If you two will identify yourself before we go to questions. Just push it and let it go red. That’s when you’re live. You’re ready to talk.

London: 00:14:16.253 I’m Charlotte London, and I’m the administrator for the board.

Burkhead: 00:14:21.843 I’m Daniel Burkhead. I’m the chairman of the board.

Rice: 00:14:24.219 Welcome. Representative Dotson, you’re recognized.

Dotson: 00:14:29.195 Thank you, Mr. Chair. Just looking at more– to your far right– just looking at your fund balances here, it looks like you’ve got many, many years’ worth of operating expenses in a fund balance. I guess, what’s your plan for that? And it looks like they’re anticipated to continue growing. Where do you get your revenues from?

London: 00:15:02.115 The revenues come from license fees and CE applications, pre-registration training applications, and also, as far as– well, that’s pretty much it as far as what the fees come from. But it’s mainly license fees. And we do have other fees that involve inactive status fees for home inspectors that want to put their license on hold.

Dotson: 00:15:32.893 So are you looking at reducing those fees or what’s your plan with that fund balance?

London: 00:15:44.193 Right now, we’re trying to start an apprenticeship program so that applicants can get more training and also not just book training but also on-the-job training in the apprenticeship to hopefully make them better home inspectors. And we’re also doing research and development, which we started that some time ago with– well, a few years back with UALR. And they did it without charging us at that time, but we’re trying to do some research into this revolving door as far as home inspectors that get licensed and for whatever reasons they’ll drop out before the year is out. And we don’t know the reasons, so.

Dotson: 00:16:38.706 So you’re not looking at reducing any of those fees?

London: 00:16:42.044 Well, our fees are already pretty low, and as far as I know, it’s been the same amount. We’ve never had an increase in the fees and it’s been the same amount pretty much since the board started.

Burkhead: 00:16:58.081 Representative, I can answer that. As the board, we’re not looking at reducing any fees. Honestly, we would like to increase fees because we can get higher, better-qualified inspectors and hopefully keep them in longer than just two or three years, which is what happens. We’re not looking at increasing fees either, but that’s the option we would like to have. As far as the fund balance, we have a plan, we’re in the works. Obviously, the whole electronic licensing plan, that costs us $10,000 a year, and it’s going to be ongoing from here on out. And that’s something we have to start getting into this year because we just started this. We’re looking at possibly asking another appropriation for another employee that’s in the works. We’re just seeing if we can support it at the moment because the workload is such that we can. What a lot of people don’t understand is we do more than just deal with the licensees, the home inspectors. We have a whole other part, which is the education side of it where we review all the education course and stuff that comes through. So there’s a whole other workload that isn’t as publicly known, I guess you can say. So we’re using that money to go towards that stuff.

Dotson: 00:18:14.226 Okay. Thank you.

Rice: 00:18:16.571 Representative Cavenaugh, you’re recognized.

Cavenaugh: 00:18:19.206 Thank you, Mr. Chair. I’m over here to your right. I just want to ask, do y’all have a backlog of applications for license?

London: 00:18:28.123 No, we don’t have a backlog of applications right now, not for licensing.

Cavenaugh: 00:18:32.040 Okay. What is your turnaround for an application? How quickly do you– when you get it, how quickly do you get it processed?

London: 00:18:41.385 Now, in the past, it’s normally been a week to 10 days before they get their license, but it’s always after a board meeting when the board has reviewed those applications and voted on approving them or not. So a week to 10 days after that. Since we’re on electronic licensing now, we’ve only been on it a little over for a month, so it’s going to be a little bit quicker. As far as right after a meeting, they can print a certificate that they’re licensed and they can start working. But as far as getting their wallet card, of course, that still might take a week to 10 days.

Cavenaugh: 00:19:28.117 Okay. So I wanted to make sure I understand. They’ll do an application and you’ll process it, then you present it to the board for the board to approve.

London: 00:19:37.409 That’s correct.

Cavenaugh: 00:19:38.146 Okay. How often does the board meet to approve those?

London: 00:19:41.509 Every month.

Cavenaugh: 00:19:42.368 Okay. And you mentioned that your fee you thought was too low. What is your fee?

London: 00:19:48.300 It’s $250.

Cavenaugh: 00:19:51.357 Okay. Thank you.

Rice: Representative Wooten.

Wooten: 00:19:58.219 Thank you, Mr. Chairman. Following on the cash fund balance, I figured that’s an eight-year balance and you’re charging $250 and you say that’s too low.

London: 00:20:15.358 I’m not saying it’s low. It just has never changed. I mean, I’ve been with the board almost seven years and it’s been the same. And it was that way even before.

Wooten: 00:20:22.898 Okay. What are they, what are they getting for the $250? If you’re the only employee, how many is on the board?

London: 00:20:34.771 It’s six on the board. It’s supposed to be seven, but we don’t have a consumer advocate. So it’s just six.

Wooten: 00:20:42.246 Well, who looks, who looks behind the application to see if they’re sound financially or if they meet– who are they? I mean, do you know who they are and what kind of a job they’re going to do out there?

Burkhead: 00:21:00.318 As far as the home inspectors, as far as the home inspectors, as far as the applicants?

Wooten: 00:21:05.249 Yes.

Burkhead: 00:21:05.743 Is that what you’re asking? The only thing that we see as a board when we review the applicant is their application that they send in. That includes a background check. It includes a required 80 hours approved course that we put out for them as well and then passing a couple of different exams, the national exam and code of ethics exam.

Wooten: 00:21:26.361 Who does your background check?

London: 00:21:28.550 I do that.

Wooten: 00:21:29.580 You do the background?

London: 00:21:30.776 The Arkansas one. If they’re from or have– if they’ve lived in another state or if they’re from another state, they do have to send in a background check from that state. But I do the Arkansas background check.

Wooten: 00:21:44.738 Thank you, Mr. Chairman. Thank you.

Wardlaw: Are these questions for? Senator Hammer, you’re recognized.

Hammer: 00:22:05.341 Thank you. Morning, y’all. You’re asking for another employee. Could you tell us what you do with your time during the day now that would justify needing an additional employee, please?

Burkhead: 00:22:16.554 We’re not at that point yet as far as asking for an employee. We’re tossing it around. That’s something we’re looking at. Yes. The reason is we feel, the board feels, our administrator’s overworked, they have more of a load. The whole EOP process, the whole transformation process actually has added more work to her. What wasn’t taken into account, as I said a little bit ago, was all of our education stuff that we do with educational institutes that put our, put our classes out there to review all that, submit invoices and all this other stuff, assign numbers and make sure they’re current. That’s an ongoing thing as well. So there’s a lot of workload that has not eased up because of transformation. And my anticipation was with the electronic licensing program that it would, but after being under it for a month and a half now, I see it’s not. A lot of that goes back to how we collect funds as far as that goes. Credit cards, for instance. They can– licensee can go in and apply for the license, pay with a credit card and all this. But then there’s like two or three other steps that our administrator has to do now just to get those funds accounted for and deposited.

Hammer: 00:23:27.433 How many monthly applications do you handle in the office?

Burkhead: 00:23:31.980 On average, we were doing anywhere from 11 to sometimes 20?

London: 00:23:37.047 Yeah.

Burkhead: 00:23:38.250 This last month we had five. So it fluctuates, but usually it’s between 11 and 20. This month, last month obviously was a low month. I can’t answer to why.

Hammer: 00:23:50.266 Director, I want to ask you a question.

London: 00:23:54.095 Charlotte?

Hammer: 00:23:54.897 No. Darryl. Sorry. Sorry. Your other boards, how many applications do they handle a month?

Cain: 00:24:07.191 Averaging 35 to 40.

Hammer: 00:24:09.954 That’s across the board, all the other ones?

Cain: 00:24:11.466 Yes.

Hammer: 00:24:13.050 Okay. All right. Thank you.

Wardlaw: 00:24:17.236 Members, I want to remind you that we do have Legislative Audit that starts, executive committee, at 11:30. So we do need to keep that in mind as we’re moving forward. Representative Beck, you’re recognized for a very quick question.

Beck: 00:24:30.650 Thank you, Mr. Chair. What percentage of applications do you deny?

London: 00:24:38.269 Very few. I’d say maybe even 1%, if that.

Burkhead: 00:24:44.192 It’s probably 1. Since I’ve been on the board, since January of 2021, I think we’ve denied about four since then. And we take in, roughly, 100 to 120 new applicants every year.

Wardlaw: 00:24:58.767 Thank you. Senator Chesterfield.

Chesterfield: 00:25:04.486 I move executive rec.

Motor Vehicle Commission

Wardlaw: 00:25:06.020 That’s a proper motion. Do I have a second? I have a second. All those in favor say aye. Ayes have it. Executive rec on the home inspectors. We’ll move on to the Motor Vehicle Commission. If we could go ahead and get those guys to the table to expedite, and Katie, you are recognized.

Walden: 00:25:23.051 Thank you, Mr. Chairman. Page 259 in your manual begins the Arkansas Motor Vehicle Commission. The objectives of this commission are to regulate and license new car manufacturers, manufacturers’ representatives, dealers, sales personnel, and motor vehicle lessors. They have seven positions. The department appropriation summary is on page 260. You’ll see they have two appropriations. They’re funded with special revenues, which are those licensing fees, as well as a fund balance. The first appropriation is detailed on page 262. This is their operations appropriation, again, funded with the special revenues. They request a total appropriation of $450,000 for each year of the biennium. And the request includes a discontinuation of one vacant position and a reduction of operating expenses each year of $40,000, and this is to better align with actual expenditures. The executive recommendation provides for the agency’s request. The second appropriation is the Automotive Technologist Education Grant appropriation. This is detailed on page 264. This appropriation should provide grants to local high schools and trade schools for the promotion of careers in the auto industry. The agency requests to continue the appropriation at $250,000, and the executive recommendation provides for the agency request. Thank you, Mr. Chairman.

Wardlaw: 00:27:05.208 Thank you, Katie. Do you have anything to say, Director, before I take questions?

Stroope: 00:27:11.927 No, sir. Just any questions you wish.

Wardlaw: 00:27:14.327 All right. Representative Cavenaugh, you are recognized.

Cavenaugh: 00:27:17.333 Thank you, Mr. Chairman. I’m over here to your right. Thank you for coming. My question is really going to revolve around fund balance and also on the grant. It’s showing that in ’21-’22, you didn’t give any grants out.

Stroope: 00:27:32.331 Yes, ma’am. That’s correct. What changed was in 504 where we set up a new fund balance for this program, and we are in the process of contributing money to that fund right now. That’s being set up as we speak. And then, at that point, there’s a different group that will make the determinations as of 504, Act 504, 2021. And that group will then meet and decide where those funds will be allocated.

Cavenaugh: 00:28:06.877 Okay. I guess I’m a little confused because we’ve got $2.4 million dollars in excess funding, and you’re saying you can’t use some of the excess funding to go ahead and fund that program so that we can actually have the grants given out? Because as you know, in this industry, we are in desperate need for mechanics as fast as we can grow them out. And we’ve gone a whole year and we haven’t given any grants out to anybody to help with that workforce problem.

Stroope: 00:28:42.906 Secretary, do you want to answer or do you want me to? Okay. All right. Well, in the past the way this worked, Representative Cavenaugh, I’m sure you’re aware, we were set up through the Motor Vehicle Commission to award grants to various schools around the state of Arkansas. Some of them were secondary, some of them were high school. There were different programs and we would look at each one of them when they submitted an application for funding for the grant, and then make a determination of which of those would be funded. In most cases, we funded pretty much everything that came in. There were one or two that didn’t fall within the parameters of the rule. But with 504, that changed the way this operates and it said that funds were to be put out of our income, from licensees, into a new separate fund that would be then seen over by a different group, not the Motor Vehicle Commission anymore. And so that’s what changed, and now we’re about to put that money into that program. And at that point, then that group will determine where those funds will be spent, where they will be allocated.

Cavenaugh: 00:30:02.317 I understand that. I guess where my confusion is coming from– if I could have some leeway, Mr. Chair.

Dotson: 00:30:07.938 Before you do that, Miss Walden, did you have something to add to that?

Walden: 00:30:12.873 Thank you, sir. Representative Cavenaugh, I just wanted to add that per act 504, as he stated, it puts the funds in a new subfund, and then it also tasks the Office of Skills Development, the Division of Career Education, and the Division of Higher Education, with now administering these grants. So they’re supposed to formulate an application process and then they certify who is eligible for the grants, and sends that back to Motor Vehicle Commission, and the funds will flow. I believe where they are in the process is they are still developing that application, those three entities. And so that’s why no funding was given in the last fiscal year.

Cavenaugh: 00:30:52.239 Okay. I just want to– thank you, Mr. Chair. Thank you, Katie. But could we not have transferred the $250,000 out of their fund balance, that that money would already be there? That’s what I guess I’m– in this particular agency we have $2.4 million dollars worth of excess funding. And that’s several years’ worth of funding. And if we’ve got a program that is desperately needed like this, can we not take some of that excess funding and put that to that grant program so that it will be there and ready to go? That’s what I’m asking.

Basset: 00:31:34.338 It could, Representative Cavenaugh. And perhaps we’re interpreting the act incorrectly. Our understanding is that the entities who are ultimately going to be dispersing these funds, it was their responsibility to get to us that information, and then we would transfer the funds. We were thinking that we were waiting on them to do that, and then we would transfer the funds. Because they can’t distribute the funds without those mechanisms in place anyway so even if we put the money over there without those requirements being met, the funds wouldn’t go out anyway. So we were basically waiting on them to do that. Now I think they’re in a process of formulating those requirements. And once that’s done, absolutely, there’s money there that we can easily transfer over. So I think that was our interpretation of the statute, and, yeah, the money’s there.

Cavenaugh: 00:32:34.758 Okay. And what are we going to do with the fund balance?

Basset: 00:32:40.845 Well, that’s a whole other question.

Cavenaugh: 00:32:43.783 Yes, it is. Thank you.

Basset: 00:32:45.696 That’s a whole other question, and, again, as I alluded to earlier, we’re going to work with this body to try to determine just exactly how we go about doing that. Since the Motor Vehicle Commission, and of course, I can’t speak to them, I’ll need to discuss it with them, but I think they would be amenable to us establishing other scholarship programs with some of that money. Since this program has essentially been moved out to other agencies, I think we have the wherewithal in the fund balance to actually create other scholarship opportunities and I would think that the board would be amenable to moving in that direction.

Cavenaugh: 00:33:25.299 Yeah. I mean, from someone in the industry, we can’t get enough diesel mechanics or just mechanics in general because we all know there’s no more shadetree mechanics. They’ve gone bye-bye, which is another whole issue. But if we could find– if we’ve got a fund balance and the ability to help get some tuitions paid to people wanting to become these mechanics, I mean, I think that would be an opportunity we need to– so y’all need to talk to me about that, if you don’t mind. Because it’s a big issue that this industry faces.

Stroope: 00:34:01.862 Oh absolutely. Absolutely. I think at least one member of your body had talked about establishing an arbitrary amount of say three years’ of operating funds and anything in excess of three years, I think, anything in excess of three years of operating funds, we could be using for those types of purposes. And, yes, ma’am, we would be amenable to having discussions with you in that regard.

Cavenaugh: 00:34:25.309 Okay. All right. Thank you.

Dotson: 00:34:27.139 Thank you, Representative. Representative Wooten, you are recognized for a quick question.

Wooten: 00:34:32.939 Thank you, Mr. Chairman. I want to follow on the fund balances. This is an eight- almost a nine– it’s an eight-and-a-half-year fund balance. And then you have a representative that points out the educational needs that are out there. But every time we’ve met today– will you go back and look at all the fund balances and try to come up with some formula or some way to cut it back to the three years, and then figure out what you’re going to do otherwise, all I hear is how we can use the money. I don’t hear anything being said about returning the money or reducing the fees to anyone. The lady that was up here before wanted to raise– they had an eight-year surplus in their fund balance and she wanted to raise the fees. So I think we’ve got a psychological thing in state government: the more money that we can take in, particularly in the fee area, the better off we’re going to be. But if we’re penalizing the people we’re supposed to be serving and caring for and making sure that the public’s being protected, we need to use that money wisely. But these fund balances– eight years? Man, I’d give anything if my business would have had an eight-year surplus, but I never did.

Basset: 00:36:04.716 Representative Wooten, your point’s well taken. It’s well taken. And I can assure you that since we saw you a couple days ago, we’ve been doing nothing but looking at these fund balances. And I’ve been talking to the boards on how they can look at these fund balances. I fully anticipated that we’d be looking at a three-year kind of rolling average on operating expenses based on the conversations that some of you had with us a couple of days ago. And we are in the process of looking at these fund balances and the utilization of those fund balances. And if given an opportunity, we’d love to have an opportunity to come back to you and discuss with you at length how we will deal with each of these fund balances going forward.

Wooten: 00:36:52.027 Okay, one quick follow-up.

Dotson: 00:36:54.307 Thank you.

Wooten: 00:36:55.224 Shared Services, how much was it costing you before transformation– or the right word to me is reorganization– but before transformation, what were your costs running to do what you are paying them– well, $67,000? Do you know what that figure was?

Stroope: 00:37:19.961 I can tell you fairly closely. Yes, sir. See, within that is also rent, as was explained a little earlier today, rent and copier costs and parking and all of those types of things. And prior to us moving over to this new building and becoming a part of DLL, I know we were paying $40,000 a year for rent, just for rent to the state. We were in a state building, but we were paying $40,000 a year just for rent. I was paying about $4,000 a year for parking. I was paying close to $2,000 a year for copier rental. So there were a whole lot of things that were included in this transformation that we were paying for separately. So as far as my costs were concerned, I’ve actually reduced my costs just a little bit by moving over there. Plus, I was getting free services, quite honestly, because I was part of the service bureau. And service bureau, the way that it worked prior to transformation, I had the opportunity to work with people over in accounting and over in legal and over in purchasing. All of these folks were employed by the state. And they were being paid somehow by the state, and they were not charging me for those services. And so, here, I’m getting services that I am paying for, but I’m getting those services and I’m paying my fair share. And I’ll voice the same as someone said earlier today, it’s really nice to be able to walk right down the hall and find a legal person to visit with and find a finance person, an HR person that I can go down and talk to because I’m not a specialist in any of those things. I’m an accountant. And I certainly don’t know a whole lot about law or about HR to begin with. But it’s nice to have all of that. And I feel that in looking back on what we did prior to transformation, my costs have actually come down just a little bit.

Wooten: 00:39:19.547 Okay, Thank you. Thank you, Mr. Chairman.

Dotson: 00:39:21.708 Thank you, Representative Beck. You’re recognized.

Beck: 00:39:24.188 Thank you, Mr. Chair. And I’ll be quick. I just had a question about– okay, the act says that you transfer the funds. You guys are saying you transfer the funds when the Department of Education, the various agencies, get all the guidelines together. So if that’s the case, then the act gave you oversight over what the Department of Education did with their grant program because they can do whatever grant program they want. Until they get money, they can’t do anything with it. So, is that your interpretation that you have the oversight, the act gives you the oversight to require whatever you want of the education group? Because they can’t put out the grants like the act’s calling them to do until you transfer the money. And I’m hearing y’all say that you’re not going to transfer the money until you see that they’re ready, which at least implies that you feel like you have oversight over that.

Basset: 00:40:27.277 No, not at all, not at all. I think the act requires them to get with the Motor Vehicle Commission based on how they’re going to distribute the funds. We’re not implying in any way that we have that type of administration. We’re simply waiting on them to get us the information as to how they’re going to disperse the money. That’s it.

Beck: 00:40:49.377 I understand. So but do you understand what I’m saying? What would that step– what would that step add? In other words, waiting for them to put their things together, what is that adding if you’re not going to hold the funds back or say they’re ready? I mean, it least implies that you’re saying that, you need to kind of okay this thing with us before you go forward with it. And if the act doesn’t call for that then I think you should transfer the money immediately to wherever it’s supposed to be. Thank you.

Dotson: 00:41:19.200 Thank you. Just with regards to– is this the first fiscal year for that $250,000 transfer?

Stroope: 00:41:27.619 Yes.

Dotson: 00:41:28.174 Okay. So you hadn’t done that in the current fiscal year? I mean, if they had gotten everything together prior to this–

Basset: 00:41:39.146 They would have the money.

Dotson: 00:41:40.469 They would’ve had the money a year ago because the act’s been in place for over a year.

Basset: 00:41:42.946 They would’ve had the money. Have they gotten with the board? We’re still waiting on the information from them to come to the Motor Vehicle Commission. And so at this point, we don’t know if there’s a structure set up to receive the money or not.

Dotson: 00:42:01.733 But have you set those funds aside for the current– or the prior fiscal year, I guess? So–

Basset: 00:42:06.863 Yes. They’re set aside.

Dotson: 00:42:07.448 –it’s accumulating each year?

Basset: 00:42:09.144 Yes, they’re set aside.

Dotson: 00:42:10.498 Okay. Thank you. Senator Chesterfield, you’re recognized.

Chesterfield: 00:42:13.669 I move executive rec.

Dotson: 00:42:16.690 I’ve got a motion and a second. Seeing no discussion, all in favor, say aye. Any opposed? Motion passes. Moving on to item seven here–

Chesterfield: 00:42:25.909 And just a quick question–

Towing and Recovery Board

Dotson: 00:42:26.740 Towing and recovery.

Chesterfield: 00:42:28.061 Excuse me. How many more of these come from the Department of Labor? How many more do we have?

Dotson: 00:42:33.348 It’s two more. We’ve got two final ones.

Chesterfield: 00:42:37.168 Two final? And then we have the Department of Health.

Dotson: 00:42:39.986 Correct.

Chesterfield: 00:42:40.872 And then we have the audit subcommittee meeting at 11:30, am I correct?

Dotson: 00:42:46.431 That is coming up at 11:30, yes.

Chesterfield: 00:42:48.709 Thank you.

Dotson: 00:42:52.230 All right, Ms. Walden, you’re recognized.

Walden: 00:42:53.134 Thank you, Mr. Chairman. The towing and–

Dotson: 00:42:54.535 And while you’re doing that, if we can have towing and recovery, if anybody’s here, just be making your way up to the desk. Go ahead.

Walden: 00:43:02.100 Thank you, Mr. Chairman. The Towing and Recovery Board regulates the towing industry in the state. Their appropriation is found on page 273 of the manual. They have four positions and they are funded with cash funds derived from license fees and fines charged to towing providers. Their total request is for $325,000 for each year of the biennium. This includes just some salary adjustments that were made in the previous biennium and there are no other change-level requests. The executive recommendation provides for the request. Thank you, Mr. Chairman.

Dotson: 00:43:37.748 Thank you. You folks have anything to say before we open up to questions? All right, Representative Cavenaugh, you’re recognized.

Cavenaugh: 00:43:48.952 Thank you. Thank you, Mr. Chair. I’m going to make this real quick because we’re tight on time. If you could just please provide me the list of all your fees, and if you could send it to staff and they’ll get it out to all of us, the list of all your fees, the list of how many licenses that you actually, people that you’re actually licensed. And with that, well, your fund balance isn’t that bad, but if you’ll get the fees and how many licensures you have and how you arrive– so if you get fees from, somebody gets a fine or something, I’d like to know that also. Yeah, that’ll be nice and quick. And that’s it. Thank you.

Dotson: 00:44:36.464 Thank you. Senator Chesterfield, you’re recognized.

Chesterfield: 00:44:38.233 I move executive rec.

Dotson: 00:44:39.860 All right. I’ve got a motion. Second. Seeing no discussion, all in favor say aye. Any opposed? Motion passes. Thank you. Moving right along to bail bonds licensing. If anybody’s here, if you can start making your way up. Ms. Walden, you’re recognized.

Bail Bonds Licensing

Walden: 00:44:57.639 Thank you, Mr. Chairman. The last board or commission for your review today from Labor is the bail bonds company and Bail Bonds Licensing Board. Their appropriation is on page 206. You’ll see the department appropriation summary on page 207. Funding is derived from cash revenues and special revenues, as well as fund balances. They have four authorized positions and their three appropriations total $1.7 million annually. The first appropriation is the operations appropriation. It’s on page 209. This provides for their operations of the board. They request about $366,000 for each year of the biennium. Any increases simply include adjustments that were made in salaries and matching in the last biennium, and the executive recommendation provides for their request. The second appropriation is the treasury cash reimbursement appropriation. It’s on page 211. This allows the board to process security deposits and lines of credit to pay outstanding judgments of bail bond companies that go out of business to the courts. The agency requests a continuation of $220,000 for each year of the biennium, and the executive recommendation provides for the agency request. The final appropriation for the Bail Bonds Board is on page 213. This appropriation provides for the recovery of forfeited professional bonds and to pay outstanding judgements to the courts at an amount up to $10,000 per bond on forfeitures left by the closing bail bond companies. They request the continuation of the 2023 level of $1.1 million for each year of the biennium. And the executive recommendation provides for the agency request. Thank you, Mr. Chairman.

Dotson: 00:46:40.120 Thank you. Do you folks have anything to add to that? All right, I got a motion executive rec. Second. Seeing no discussion, all in favor, aye. Any opposed? Motion passes. That takes us to item number nine, Department of Health. If we could have somebody come up to the table, whoever’s on your way up here. And Ms. Hamilton, you will be recognized as soon as you are ready.

Hammer: 00:47:12.443 Thank you, Mr. Chairman.

Department of Health

Dotson: 00:47:22.128 Hold on before we get started here. Representative Wooten, you had a question?

Wooten: 00:47:26.288 Mr. Chairman, I have a question. And I know they’ve gone to a lot of effort in their budget preparation, but I don’t think in 30 minutes that we can look at all this budget information that we have concerning the Department of Health. I either say that we do– I make a motion that we either consider it in totality today in whatever time the membership needs or that we postpone and ask them to come back.

Dotson: 00:47:56.111 Representative, the Legislative Audit executive subcommittee is not meeting in this room. So we often walk and chew gum at same time around here–

Wooten: 00:48:04.790 We’re not being held to a time factor–

Dotson: 00:48:08.933 We’re not held to it. It’s just a–

Wooten: 00:48:10.428 –other than the membership of that committee having to leave.

Dotson: 00:48:13.464 Right. And it’s the executive subcommittee of leg audit. The regular committees will meet in the afternoon. So I intend to keep going. Hopefully we can knock this out this morning. Miss Hamilton, you’re recognized to begin.

Hamilton: 00:48:30.336 Good morning, members. Thank you, Mr. Chair. In light of Representative Wilson’s comments, did you want me to go through the entire budget or did you want me to just hit the appropriations that have change levels? What would the subcommittee like me to do?

Dotson: 00:48:43.409 Let’s start with those that have change levels. And then if members have questions on specific other areas, we’ll get to those.

Hamilton: 00:48:51.701 Thank you, Mr. Chairman. All right. So we’re going to start with the first item on page 35. You’re going to see the shared services appropriation. The Health Department basically develops public health policy and plans, and they enforce regulations for environmental health protection. This is their shared services appropriation. On page 36, you will see that it is used to pay for the secretary of Arkansas Department of Health’s salary and their personal services matching. They are requesting that this appropriation continue. This is funded by a transfer from their operating account. You’ll note on page 37 that the only change is an increase to the personal services matching appropriation line item. This is due to some rate adjustments that occurred in the previous biennium that they’re asking to be continued into the next. Moving to page 65, I think I’m going to make a note of this item. This is one of the statutorily required reports that the department has to provide, and it’s for the minority businesses contracts over $50,000. You’ll see it on that page. They have two culturally connected communications. They provide public relations, and they specialize in diversity and cultural marketing. And then they’ve got another one with The Design Group marketing group, and they provide multicultural communications. One contract is for $1 million, the other is for $2 [million]. You’ll see the total contracts that have been awarded by this agency equal $400 million. On the next page, on page 66, this is the department appropriation summary. They have nine appropriations, but there are only four with changes. Before I move forward, I’m going to remind you of what Mr. Breck discussed the first day of budget hearings, which is that they’ve got 18 appropriations that you’ll see that are not requested for the next biennium. These are ARPA-funded appropriations. You’ll see the expenditures in the actual 21-22 line item column, but nothing moving forward. Funding sources are a variety. They’ve got fund balances, general revenue, federal revenue, there’s some fees from the local health units, and then there’s some fines and assessments, some rebates, and some reimbursements from third parties. We’re going to move to page 190. That’s the first appropriation that has changes– I’m sorry, page 70 and 73. Sorry about that. Yeah. On page 74, you’ll see they have a nuclear planning grants appropriation. This is from a special revenue fund, and it provides grants for emergency management for local governments. And these are for the counties that are located around Nuclear One. Funding for this is from the assessments against utilities that operate nuclear-generating facilities in the state. They’re requesting a continuation of their appropriation. Right now, they’ve got $325,000 they’re spending. This is an appropriation that’s divvied up into $65,000 payments to each one of those counties. On page 76, this is their trauma system appropriation. It’s a general revenue funded appropriation and right now the appropriation is used to provide guidelines for the care of trauma victims. The appropriation is used to provide guidelines for the care of the trauma victims and the system is fully integrated with existing emergency medical services providers, hospitals, and other healthcare providers. On page 77, you’ll see their appropriation summary. On the personal services line item, you’ll see there’s a slight increase in personal services matching. You’re going to see that throughout the budget and most of it is essentially the rate adjustments that we mentioned that happened during the previous biennium that they’re asking to continue. The agency is requesting an appropriation of about $26 million in fiscal year 2024, $26 million and fiscal year 2025 and general revenue of $18 million since this a general revenue funded appropriation. And the executive recommendation is for the agency’s request.

Hamilton: 00:53:18.168 The next appropriation can be found on page 79. This is their tobacco prevention and cessation program. This is a trust funded appropriation. Right now it is utilized for a community prevention program, some school education prevention programs, enforcement of tobacco control laws, and some health promotion campaigns. They do offer grants. There are some contracts that they work with entities in the community to promote tobacco prevention cessation efforts. The agency is requesting to discontinue two positions so you’ll see a corresponding decrease in personal services matching and regular salaries. And this is due to these positions being vacant for two or more years. They’re also requesting an upgrade of one position in one of their line items and you’ll see a corresponding increase in that. The executive recommendation provides for the agency’s request, but you will note that there’s a difference because any upgrades or additions to positions have not been recommended unless they have been approved through Council or through a miscellaneous federal grant. So the agency’s request is going to be slightly more than the executive recommendation and you’ll see that on page 80.

Hamilton: 00:54:39.507 So if you look in the 22-23 authorized column, you’ll see the number of positions is decreased from 33 to 31 for both the agency and the executive. And there are corresponding decreases in personal services and matching and regular salaries. And this is something that the executive is recommending for the next biennium. Before I conclude, I want to mention one thing. There’s a fairly new appropriation on page 85. It’s the full independent practice credentialing appropriation. This is a cash and treasury appropriation. It was established to provide a legitimate pathway to full practice authority for certified nurse practitioners. I’m mentioning this because this was a bill that was sponsored by Senator Hammer. The funding for this appropriation, you’ll note on the next page, has not yet been established. Right now I understand that the committee members have been chosen and appointed by the Governor. They’ve met several times and continue to meet. The department of health, I understand, is working with this committee in order to make sure that they’ve got their rules drafted and developing processes. If you look on page 86, you’ll see no actual expenditure but they’re asking for continuation of the $350,000 appropriation into the next biennium, which is what the executive is recommending. Last appropriation is on page 87 and this is for the interpreters for deaf and hearing impaired. This is a special revenue fund, and it is utilized to provide for the advisory board expenses. An increase of $15,000 is being requested by the agency in appropriation for both years to provide ongoing support for their services. You’ll see the increase on page 88. In 2022-23, you’ll see that $10,000 is authorized, and the increase, which is also being recommended by the executive branch, goes up to $25,000 for each year of the biennium. That is the conclusion of my presentation, Mr. Chair.

Dotson: 00:57:00.937 Thank you. Does the department have anything to add before I open up for questions? Push that one more time. Please state your name for the record.

Mallory: 00:57:12.597 We do not. Renee Mallory, Interim Secretary of Health, and we have staff here that’s happy to entertain any questions on our budget.

Dotson: 00:57:19.236 All right. Representative Cavenaugh, you are recognized.

Cavenaugh: 00:57:22.455 Thank you, Mr. Chair. I’m over here to the right. Thank y’all. The first question I have is dealing with the trauma center. I just want to make sure– and it’s on our page 77– I just want to make sure this funding of the trauma centers are– is this the funding that helps fund the trauma centers throughout the state? Is that what this does?

Mallory: 00:57:42.185 It is, Representative Cavenaugh. It’s our administration of the program, plus what goes out to the hospitals and other entities.

Cavenaugh: 00:57:50.145 Okay. Then I want to talk about the excess funding. I noticed you got $11.5 million in excess funding. Is that because we’re not using– is it the trauma centers are not getting used, or?

Mallory: 00:58:07.312 We actually get the money out to hospitals in the form of grants. During COVID, of course, and you’ll see this across some of our programs, our expenditures are down because of that. They were doing other things. But we have looked at what we can do with that fund balance and looked at possibly getting more out to our hospitals and to our EMS agencies.

Cavenaugh: 00:58:32.044 Okay. Yeah. Because I know our trauma centers are important and that’s why it’s just– normally I wouldn’t expect to see such a large fund balance in that particular area, so.

Mallory: 00:58:41.945 Yes, ma’am.

Cavenaugh: 00:58:43.059 And Mr. Chair, I have another question, if that’s okay.

Dotson: 00:58:46.968 Yep. One more and then we’ve got some in the queue.

Cavenaugh: 00:58:51.752 Okay. Thank you. This is going to be dealing with page number 80, which is the tobacco prevention, and I’m going to talk also about that actual fund balance. It’s $21.7 million, and actually on the tobacco prevention, we’re only using $5.1 million of that. That goes towards those programs, according to the data. Now a big chunk of it is going to professional fees for $2 million. So what are we actually doing with this tobacco money that’s helping us stop people using tobacco?

Mallory: 00:59:33.963 So, of course, we give money to the Arkansas Cancer Coalition. We have Be Well Arkansas, where people that are smoking call us and we do follow-up with them. We’ve got a better success rate with Be Well Arkansas than what the national average is. We are also getting into vaping. We do a lot of advertising. We go out to the schools and help them. There’s a lot of things that we do with our tobacco program.

Cavenaugh: 01:00:10.788 Okay. And your professional fees, what is included in that? I would assume that what you just described goes into tobacco prevention. What is your professional fees?

Thompson: 00:00:33.931 Good morning. My name is Jo Thompson. I’m the chief financial officer for the Department of Health. Our professional fees are for contracts that go toward those services. I don’t have a list of those specific contracts. But we do have, we do have staff from our Center for Health Advancement that could tell you those contracts, but that’s what that’s for.

Cavenaugh: 00:00:52.355 Okay. Instead, I’ll just bring, for time issues, if you wouldn’t mind giving to staff exactly what’s in that and exactly what we’re doing for that $5.1 in the tobacco, I’d appreciate that.

Thompson: 00:01:05.266 Yes, ma’am.

Cavenaugh: 00:01:05.858 Thank you.

Dotson: 00:01:07.348 All right, Representative Vaught, you’re recognized.

Vaught: 00:01:09.538 Thank you, Mr. Chair. Kind of following up on what Representative Cavenaugh was talking about, can you give me some examples of what you’re doing for vaping because I don’t see vaping decreasing in our schools. I see it increasing and there being more of a problem. So somehow there’s a disconnect from what you’re doing and what’s actually happening.

Mallory: 00:01:31.874 So, Representative Vaught, vaping is new. So we are going out to the schools and teaching them about vaping. We have Project Prevent with Children’s Hospital. We are doing advertising along the vaping issue. We also have a new program. There’s nothing nationally that targets kids for vaping. For our elementary schools, we have come up with a new program that hopefully it’s being nationally recognized that we can get out to the schools, but it’s really, really new, like within the past three or four months.

Vaught: 00:02:12.111 Can you tell me how many schools you’ve been in? I mean, you have a large fund balance, so I’m assuming we’re trying to hit every school in our state with this type of information.

Mallory: 00:02:24.220 Every school that’s willing, but I don’t know the number to that

Vaught: 00:02:27.099 If you can get me the number of schools that you’ve been in and what you’ve done to get in those schools and how we’re lacking getting in other schools, I would appreciate that.

Mallory: 00:02:35.238 Absolutely.

Vaught: 00:02:36.097 Can I have one more question, Mr. Chair? And I’ll hurry. On page 37, it says regular salary $17,000– or $17,906. And you’re budgeted for $173,522, and you only have one employee. Can you tell me why we’re budgeted for $173,522, but we’re– and are we really paying someone $17,000?

Adams: 00:03:03.462 Don Adams, Deputy Director. So in this particular appropriation, the expense is related to last fiscal year. The only thing in this expense is our secretary salary. And so our previous secretary was not paid out of this particular fund. So that’s why there’s limited expenses. So when interim secretary was appointed, her salary started to be drawn from this particular appropriation, and there was only a few months in which her salary was for last fiscal year. And so moving forward, it’s got a full salary’s worth of appropriation, which is based on, I think, the– not the past director, but the director before that, his salary. That’s what that’s based on, along with some cost of living increases.

Vaught: 00:03:53.803 Okay, thank you.

Dotson: 00:03:56.752 All right. Representative Scott, you’re recognized.

Scott: 00:03:59.479 Thank you, Mr. Chair. I’m over here. I just had a quick question about, I guess, page 80, looking at the fund balance similar to what Representative Vaught said. Did you mention that you eliminated two positions and did an upgrade for one of the positions of the tobacco program?

Thompson: 00:04:23.493 That’s the request, ma’am. It hasn’t been implemented yet.

Scott: 00:04:27.127 Okay. And so, also, I see extra help. So are you requesting for extra help as well?

Adams: 00:04:37.055 Yes, ma’am. Don Adams, Department of Health. The only two positions that are decreased, that’s due to Act 796, which required any positions that were vacant for more than two years to be surrendered, so that’s the result of those. The upgrades relate to, I believe, it is our nutritionist positions that we were requesting an upgrade on due to our inability to recruit. But that’s not included in the executive recommendation because there’s a broader pay plan increase that may be considered during the session. So that was put on hold. And yes, we do utilize extra help in some of our programs, such as the Tobacco Prevention and Cessation Programs.

Scott: 00:05:14.097 Okay. Thank you.

Dotson: 00:05:16.294 Thank you. Representative Wooten.

Wooten: 00:05:19.345 Thank you, Mr. Chairman. I want to ask you some questions about the personnel very quickly. You have 22%. You have 446 vacant positions. 22% of those are over two years old. Do you know the age of those? Are they three years, five years, six years, two years?

Adams: 00:05:46.210 The positions that we have that are over two years old should only be slightly over two years old because the rest of them we’ve surrendered, with maybe a few exceptions, maybe one or two. So most of those positions would be about two and a half years old or less.

Wooten: 00:06:00.676 Okay. Follow up on that. On the State Medical Board, I noticed they have 11 vacancies, 70%. They have 16. Eleven of those are over two years. Why is that so high?

Adams: 00:06:18.948 Well, I’d have to refer that to Matt Gilmore and the director to discuss those specifics.

Dotson: 00:06:25.739 The State Medical Board is coming up, but we’re not quite there yet on the agenda.

Wooten: 00:06:30.177 Okay. All right. One more question for them. Have you all been briefed by the federal government relative to the iodine pills that are being passed out in Ukraine concerning the nuclear attack? Is that part of your planning?

Dotson: 00:06:50.081 Representative Wooten, we need to stick with the budget.

Wooten: 00:06:53.843 Well, this is budget. I want to know if they’re spending money on preparing for a nuclear attack. And I understand the federal government has bought several million pills, is that correct?

Mallory: 00:07:06.842 I don’t know the answer to that. We have not been told that, Representative.

Wooten: 00:07:10.131 Thank you, Mr. Chairman.

Dotson: 00:07:11.492 All right. Thank you. Senator Chesterfield.

Chesterfield: 00:07:16.728 I move executive rec.

Dotson: 00:07:18.214 I’ve got a motion. Got a second. Seeing no discussion, all in favor. Any opposed? Motion passes. Thank you. Take us to Health Services Permit Agency. Ms. Hamilton, you’re recognized.

Health Services Permit Agency

Hamilton: 00:07:36.883 Thank you, Mr. Chairman. Members, we’re still in volume one. We’re going to go to page 109. You’ll see the analysis of the budget request for the Health Services Permit Agency. This is a general revenue funded appropriation, and it’s used for issuing permits of approval for nursing homes, residential care facilities, assisted living facilities, psychiatric residence facilities, and similar entities. It’s funded, as I said, from general revenues but also fees from certificate of need applications. There are going to be some personal services and matching requests. The agency is also requesting a discontinuation of one position with a corresponding decrease in regular salaries and personal services matching. And this is again, due to the fact that the position’s been vacant for two or more years. On page 110, you’ll see their appropriation detail in the authorized column, again, for fiscal year 22-23 you’ll see 5 positions and then the decrease being requested in both the agency and the executive recommendation for fiscal years ’24 and ’25 with the corresponding decreases in matching and regular salaries. That concludes the presentation, Mr. Chair.

Dotson: 00:08:43.541 Thank you. Seeing no questions, do I have a motion? I’ve got a motion for executive rec. Second. All in favor, aye. Any opposed? Motion passes. Thank you for coming up to the table. Minority Health Commission. Ms. Hamilton, you’re recognized to present.

Minority Health Commission

Hamilton: 00:09:01.947 Thank you, Mr. Chair. On page 120 in your manual you will see the department appropriations summary. There are three appropriations for this entity but we are only going to go through two of the appropriations that have change levels. If you’ll go to page 124, you’ll see the first appropriation with change levels is the Minority Health Initiative Appropriation. It’s a trust funded appropriation. Tobacco settlement dollars are what funds it. In the authorized column you will see that there is an increase in positions being requested into the next biennium. So they’re moving from five positions to six positions.

Hamilton: 00:09:40.724 The agency would like this for the restoration of one growth pool position that was approved by Legislative Council in September of this year. You’ll see the corresponding increase requested in regular salaries and personal services matching. This is the executive request and recommendation. On page 125, you will see their operations appropriation. This is also a general revenue funded appropriation and they use it to study issues related to the delivery of and access to health services for minorities. They usually provide a report to Council, the General Assembly, and the governor of any gaps in a health service that are particular to minority populations in the state and they give recommendations. They are asking for continued appropriations and a request for general revenue funding in the amount of $260,000 for both fiscal year ’24 and $262,000 for fiscal year ’25. On page 126, you’ll see the appropriations summary and you’ll note the increases in the regular salaries and personal services line items, as well as, look down at the funding sources, you’ll see the general revenue that they’re requesting an increase in. The executive recommendation provides for the agency’s request. That’s it, Mr. Chair.

Dotson: 00:11:00.331 Thank you. I’ve got a question. Representative Cavenaugh, you’re recognized.

Cavenaugh: 00:11:07.586 Thank you, Mr. Chair. I’m over here to your right. Thank you. My question is going to be on page 124. I’m looking at our excess funding which is $6.1 million, and I noticed that in 2021 we only used $228,000 for the screen and the monitor and the outreach. And that’s lower than it has been historically. And why are we spending less, especially in the time of a pandemic, to reach out to the minorities in areas in our state? Because I know myself, with the Hispanic and the Marshallese that we have in our area, they got hit pretty hard with the COVID. And so I’m just curious about that.

Eddings: 00:11:52.796 Good morning. I’m Kenya Eddings, executive director for the Arkansas Minority Health Commission. And so you’ll see that during COVID 19, it hit us pretty, pretty hard. We’re still trying to recover from that. And so, because of that, our expenses were reduced. We hope that with things being lifted that we can get back out in the community so that we can spend those dollars to address the minority population.

Cavenaugh: 00:12:24.571 Follow up, Mr. Chair. So for the screen and monitoring, the outreach programs, are those actual screening tests for the minorities? What is actually involved in that?

Eddings: 00:12:36.011 And I will just say that I am new to this position. So I’m almost nine months into the position, but we did receive CARES funding to help with screening, testing, and things like that in the community.

Cavenaugh: 00:12:51.212 Okay. But is that what this actually is used for?

Eddings: 00:12:56.018 So we have our accountant here, and she is happy to help address the question for you.

Cavenaugh: 00:13:02.784 Okay. Thank you.

Frazier: 00:13:04.621 Good Morning. Este Frazier accountant for the Arkansas Minority Health Commission. The reason for our fund balance, yes, COVID did hit us, but we also received funds from CARES. And those CARES funds were distributed to organizations, faith-based organizations as well, to assist with allowing them to purchase PPE, some funeral costs, food, especially in the Marshallese population. Heavily in the Marshallese population.

Cavenaugh: 00:13:44.185 And what about the excess fund? What are y’all’s plans on that? How are y’all going to utilize that to help these particular populations?

Eddings: 00:13:54.389 Thank you for that question. We do plan to expand. We have a lot of plans to do some work with maternal morbidity, mortality, and depression, as well as mental health. As you are aware, COVID-19 put a tremendous burden on mental health, particularly in the minority community. So we want to do some outreach, continue our outreach with that and then just in addition to that, continue with our preventative screenings and programs as it relates to heart disease, cholesterol, hypertension, and the like.

Cavenaugh: 00:14:28.648 And is sickle cell– and do y’all do stuff for sickle cell?

Eddings: 00:14:32.015 We do have awareness as it relates to sickle cell. Thank you. Last month was Sickle Cell Awareness Month.

Cavenaugh: 00:14:36.799 Okay.

Mallory: 00:14:38.022 And I will add, Representative Cavenaugh, you know, Kenya says she’s new. She’s been there nine months. She’s got a lot of good ideas for things to do and spend some money.

Cavenaugh: 00:14:46.567 Well, I just know Marshallese is a big population in my area, along with Hispanics. And so, I know that they have some special needs. And when we got that fund balance, I’m thinking, “Is there a way that we can kind of target those areas so we can make sure that they’re getting the information that they need?”

Eddings: 00:15:02.356 We’ve had some conversations with some representatives from the Marshallese community and plan to go up and visit with them in Northwest Arkansas really soon. We continue our radio program with the Marshallese radio station that Dr. Rick Lon hosts every month with outreach health Information, etc.

Cavenaugh: 00:15:21.104 Okay. Thank you so much.

Dotson: 00:15:22.569 Thank you. Representative Vaught, you’re recognized.

Vaught: 00:15:24.812 Thank you, Mr. Chair. I would also ask that you come to Southwest Arkansas where we have a lot of Marshallese and Hispanics also.

Eddings: 00:15:31.604 Absolutely. And we do utilize our mobile health unit to get into that area. And we cover all 75 counties. So wherever there is a need, we are more than willing to go to. So thank you for that invitation.

Vaught: 00:15:45.452 Thank You.

Tobacco Settlement Commission

Dotson: 00:15:46.884 Thank you. Seeing no other questions– hold on. I got a motion executive rec. A second. All in favor? Any opposed? Motion passes. Thank you. Moving on to number 12, Tobacco Settlement Commission. Ms. Hamilton, you are recognized.

Hamilton: 00:16:10.605 Thank you, sir. On page 171, you’ll see the operations for the Tobacco Settlement Commission. This is funded from investment earnings from the tobacco settlement program fund and their program accounts. They utilize this appropriation to monitor and evaluate expenditures made from the four program accounts that were set up by Initiated Act 1. Those are the Prevention Cessation program account, the Target State Needs program account, the Arkansas Biosciences Institute program account, and the Medicaid expansion account. Agency is requesting just a few changes. A discontinuation in one position with the corresponding decreases in regular salaries and match, and this is because the position has been vacant for two or more years. The executive recommendation does allow for the agency’s request. And you’ll see on their appropriation summary, on page 172, once again, in the authorized column for fiscal year 22-23, two positions, and then moving into the biennium, a decrease. So there’s one position moving forward and then the corresponding decreases. That’s it, Mr. Chair.

Dotson: 00:17:13.218 Thank you. Representative Cavenaugh.

Cavenaugh: 00:17:16.122 Thank you, Mr. Chair. I’m over here to the right. I’m going to just talk about the fund balance in this one, too, because it’s quite large if you look at it compared to what your expenses are. What do we do with that fund balance?

Gilmore: 00:17:28.972 Matt Gilmore, department of health. Thank you, Representative Cavenaugh. The Commission operated strictly off of revenue from the interests. They don’t receive any other funding. The last couple of years, with the downturn in interest rates, they have not gotten anywhere near what they typically bring in for their normal expenses. So you’re right. There is still a balance there. But again, at the same time, they don’t receive any general revenue. So there needs to be a little bit there to carry them forward if the settlement funds ever drop off completely. The commission, in the past, has done some grants. They’re going to evaluate that again. It’s been a while since they’ve done those. I don’t think they saw the return that they wanted to on some of those grants, but I think that is an option moving forward. But also, working with the department of health, and as these boards and commissions have come underneath them, the department has got some ways to help support those services. As you noticed, they cut the personnel down to one so they can come in and help with some advice and guide there on how to do those grants going forward.

Cavenaugh: 00:18:26.132 Well, you have a fund balance for over 23 years based upon your expenses.

Gilmore: 00:18:31.891 Correct. The–

Cavenaugh: 00:18:32.669 So what do we do with that fund balance? Because I understand needing a surplus and some reserves. 23 years is a little extreme in this particular case.

Gilmore: 00:18:42.779 True. As I said, I think we’re going to look at going forward with some grants like we did in the past with the commission. I know the commission stopped those, but we’ll do that moving forward. That’s where I would say at this point. But we can look at that moving forward, again.

Cavenaugh: 00:18:57.874 And this might be a question for staff. Is there anything statutorily that says that we have to do with this money, that it has to be used in a certain way? Has it got handcuffs on it? I guess that’s what I’m asking.

Gilmore: 00:19:12.448 Representative Cavenaugh, I can answer that somewhat. It just has to be– it does have to be health-focused so we can work with the department of health. They have lots of different grant programs that we can tag on to, maybe help support those, but it has to be health-focused. Yes, ma’am.

Cavenaugh: 00:19:25.368 But it doesn’t have to be tobacco-focused. So it can just be health-focused?

Gilmore: 00:19:28.004 It could be related to health in some way. Yes, ma’am.

Cavenaugh: 00:19:31.502 Okay. All right. Thank you.

Dotson: 00:19:34.010 All right. Representative Wooten.

Wooten: 00:19:36.428 I’m just curious. You have two employees, and you have one position that’s been vacant for two years. What is that position?

Gilmore: 00:19:45.949 It was the director. And when the transformation happened, the department of health absorbed those duties, and so we have one person there doing the work now, working with the department of health on other duties.

Wooten: 00:19:55.449 So if you’ve absorbed it why are you still carrying it?

Gilmore: 00:19:58.959 Well, we’ve surrendered it. It’s been surrendered.

Wooten: 00:20:01.831 Well, I know that, but why do you even show? Why don’t you just give it up? I mean, this is an ongoing battle. I don’t understand why you want to hold on to something that you’ve already done away with.

Gilmore: 00:20:17.191 So in the last session, your bill that you passed, we had to identify positions. That position is going away. It’s still showing in the budget, but it’s going away. We’ve already surrendered it.

Wooten: 00:20:26.885 And this fund balance thing is an ongoing deal. Every year, we come up here, and we hear every agency, most of them, have– I understand a two- or three-year, but I do not understand a 23-year fund balance. That money can be used wisely to whatever it’s intended for, but holding on to it– we either need to reduce the fees or use the money or– of course, this is not fee based, but still. Thank you, Mr. Chairman.

Dotson: 00:20:55.632 Thank you, Representative. Seeing no other questions, do we have a motion? I got a motion. I got a second. I see no questions. All in favor, aye. Any opposed? The motion passes. Thank you. Moving on to Examiners of Alcoholism and Drug Abuse Counselors. Ms. Hamilton, you’re recognized.

Alcoholism and Drug Abuse Counselors

Hamilton: 00:21:19.521 Thank you, Mr. Chair. We’re going to move to page 42 in your manual. This is a cash-funded appropriation derived from license fees and interest distributions. They utilize it to license alcoholism and drug abuse counselors, regulate the licenses, and investigate complaints. They also sanction any who violate the rules or the code of ethics of the board. There are no changes requested, so the budget is pretty much the same as what was authorized in 2023. The only thing I’ll note on page 43 is when you’re looking in the regular salaries line item, you will see an amount, even though there are no positions. This is a board that does get member stipend payments, and that’s where you’re going to see that expenditure. That’s the conclusion to my presentation, Mr. Chair.

Dotson: 00:22:09.687 Representative Cavenaugh, you’re recognized for questions.

Cavenaugh: 00:22:14.390 Thank you. Really, what I’m going to be talking about is the turnaround time for applications. So I’m just trying to get a feel for this. Do we know what the turnaround time is and the approval for renewals and new ones? Do we know how long, do we have a backlog?

P Fite: 00:22:35.461 Pamela Fite, board administrator. Our turnaround time is very quick. We meet monthly. If they approve the licensees, then I get the paperwork documentation out the next week. We don’t have a backlog.

Cavenaugh: 00:22:49.428 Okay, thank you. And do we have any plans to look at state compacts or we might start working with state compacts with these type of licensures?

Gilmore: 00:22:59.858 Representative Cavenaugh, I think you’ll see when the psychology board comes up here in a little while, they did a compact last session. There is talk about one with counseling. I don’t think the board really has a position on that, but I do think that there is some talk amongst the industry to do that. And I think that would– I don’t know how that would impact this specific license, but in general, we don’t have a major issue with compacts in general.

Cavenaugh: 00:23:25.897 If we could do compacts, it makes it much easier, as long as the compact is a good compact. Let me just put that caveat out there.

Gilmore: 00:23:31.772 That is the problem sometimes. We have to make sure it matches up with the state–

Cavenaugh: 00:23:35.155 With what are our goals long-term. Okay. Thank you.

Dotson: 00:23:38.685 Representative Vaught.

Vaught: 00:23:41.692 Thank you, Mr. Chair. Can you explain the process of your applications, renewal, are they online? And do you all do policy and licensure and CEEU’s or what do you all do?

P Fite: 00:23:57.263 Yes. We’re not online. We actually have a very small budget as you can see. So it’s all manual, mailed to me. The requirements are three years of supervised work experience. Our LADACs have to hold a master’s degree. They also have to have another credential. So we have LPCs, LCSWs, psychologists. They’re all fully credentialed. Renewal time, we were asking for 40 continuing ed hours per two-year session. And we’re in the midst of promulgating a new rule and making that 30 hours.

Vaught: 00:24:37.726 And Representative Cavenaugh might have asked this, I might have missed it, but how often do you all meet?

P Fite: 00:24:42.846 Monthly.

Vaught: 00:24:43.356 Once a month?

P Fite: 00:24:44.649 Mm-hmm.

Vaught: 00:24:45.508 Okay. Thank you, Mr. Chair.

Dotson: 00:24:47.382 All right. Thank you. I’ll take that motion now. And I got a second. All in favor? Any opposed? Motion passes. All right. That takes us to Board of Examiners in Counseling. Ms. Hamilton, you’re recognized.

Board of Examiners in Counseling

Hamilton: 00:25:09.327 Thank you, Mr. Chairman. We’re moving to page 51 in your Volume 1. This is a cash and treasury appropriation that’s funded from application renewal, fees, fines, interest. The appropriation is used to govern the appropriate practice and the behavior relative to counseling services. They have purview over professional counselors, associate counselors, marriage and family therapists, and associate marriage and family therapists. They utilize their appropriation expenditures for the administration of examinations and licensure as well as the operations of the board. You’re not going to see a lot of changes. On page 52 in their appropriation summary, all of the increases as you see are going to be, as I mentioned before, due to a salary and matching rate adjustments that occur during the biennium that they’re asking to continue. That’s the agency’s request and that’s what the executive recommendation is.

Dotson: 00:26:02.005 All right. Thank you. Representative Vaught, you’re recognized.

Vaught: 00:26:05.703 Thank you, Mr. Chair. We’ll talk about fund balances first. How about that? So I see that you do have a large fund balance. I’ve not looked in the book to see how long your fund– how old your fund balance is. Can you tell me what you plan to do with the fund balance?

Gilmore: 00:26:21.469 I can start and then we’ll let Ms. Erickson– she cut her fees– several boards right after transformation, we did a fee cut across, I think, around seven or eight boards. So she has cut hers and you can kind of see it going down there. So we’re watching that closely. She also has implemented some licensure updates to her online platform. So that’s going to bring that down as well. But I think we’re going to watch this one closely but there’s a fine line in there. You can cut too much and then go into the deficit, so we’re trying to be careful there.

Vaught: 00:26:58.686 So we’ve been having a large working group talking about mental health here in the state of Arkansas and what we can do to move forward and actually move the needle in Arkansas because we’re really low on the totem pole when it comes to mental health and actually making a headway in it for the better. So I want to know how often your board meets.

Erickson: 00:27:28.409 Lenora Erickson, Arkansas Board of Examiners and Counseling director. We meet monthly.

Vaught: 00:27:32.796 Okay. And so what type of business does your board handle? Does it handle policy, CEUs, licenses?

Erickson: 00:27:39.880 All of it.

Vaught: 00:27:40.639 Okay. And can you tell me the process for a new graduate to get their license?

Erickson: 00:27:45.492 They can apply within their last semester of graduate coursework to go ahead and start that process. They send us their application. I approve all of the core curriculum, send them the letter to take the national exam. And the national exam process is a different thing. We’re not in control of that. They just administer the exam. Once they get their exam scores back, the exam administrators upload the scores for us. We download those. They have to do a background check so it’s a little bit of a lengthy process, but some people can get licensed within a month if they start their exam before they graduate. And that’s why they’re applying before they actually graduate. Then we go ahead and get them started on their background checks and their national exams so that when they do graduate it goes pretty quick. One thing that we are working on right now is doing all processes online. We’re in the midst of transitioning to all online applications. We already got all online renewals, complaints, reporting, and everything. So we’re in the midst of it right now.

Vaught: 00:28:46.820 Okay. I will say during our workgroup there is a lot of complaints about y’all’s licensure and about how y’all do business and how efficient it is and how quickly y’all get things done. And I do mean a lot of complaints about it. That’s one reason that I asked for y’all to come back is because, again, we are in a mental health crisis in the state of Arkansas. We’re talking zero to prison. We’re in a mental health crisis and we’re taking too long to get people into the field actually working with their licenses. Thank you, Mr. Chair.

Dotson: 00:29:24.713 Thank you. Representative Cavenaugh, you’re recognized.

Cavenaugh: 00:29:27.018 Thank you chair. And just going off of what Representative Vaught was speaking about, do you have a backlog, and if so how much is that backlog for licenses?

Erickson: 00:29:36.689 We do have a working cabinet of people that we’re waiting on documents to get to us. They’re within the process. Maybe they haven’t taken their exam or they failed it or they haven’t finished their background check or they’re not graduated yet. So if they start applying before they graduate, they can’t actually finish the process until they do graduate. So we could hold– we could be working with an application for a year if they don’t finish the process. If they graduate but they don’t pass their national exam, they have to retake it. But usually, people get licensed within a month. Because we meet every month, they’re reviewing licenses every month.

Cavenaugh: 00:30:14.976 Okay. Do you know how many applications you have that you’re working on?

Erickson: 00:30:18.296 That I’m working with? No, I don’t have that number with me.

Cavenaugh: 00:30:20.042 Okay. And are you looking at any state compacts?

Erickson: 00:30:25.359 We looked at the one that’s out there just to be familiar with it, but they’re not discussing it.

Gilmore: 00:30:33.764 Representative Cavenaugh, kind of like I said, that’s an issue that I consider a type of a scope issue. And that’s a decision that I think this body has to make. The board’s not opposed to that is my understanding.

Cavenaugh: 00:30:45.143 Okay. Thank you.

Dotson: 00:30:47.232 All right. Thank you, Representative. And if you’re looking at any type of scope changes, I’m not sure exactly what the deadline is to get an ISP in, but it’s coming up pretty quick.

Gilmore: 00:31:00.460 Let me clarify that a little bit. I don’t think it would quite meet the definition of a scope ISP. But we try not to get the board involved in a conversation that may be controversial. Because there are some that do want the compact, some that don’t. So we leave that for the industry and this body to make that decision.

Dotson: 00:31:16.078 Thank you. Seeing no further questions, we’ve got a motion executive rec. Second. No discussion. All in favor? Any opposed? Motion passes. Thank you. State Medical Board. Ms. Hamilton, you’re recognized.

State Medical Board

Hamilton: 00:31:34.608 Thank you, Mr. Chair. We’re moving to page 116 in your manual. This is the operations appropriation for the State Medical Board. It is a cash operation funded from fees charged by the agency. This is used to empower and license and regulate the practice of medicine. In addition to that, they have assumed the licensing regulatory responsibilities for other allied health preventions, including occupational therapists, respiratory therapists, physicians assistants, and radiologist assistants. They also register medical corporations. The request for the agency for the next biennium is to discontinue seven positions. And this, again, is because the positions were vacant for two or more years. The executive does provide for that request. And you’ll see the corresponding decreases on page 117 in the regular salaries and personal services matching line items, as well as in the authorized number of physicians. You’ll see the decrease goes from 41 to 34. The only other thing I’ll note is on the capital outlay, a line item, which is at the bottom of the appropriation summary, you’ll see they will authorize $66,000, but there are no requests for appropriation for the next biennium. They use this for a company called Government Connection. And they were providing IT, cloud and software, and other related services. They no longer need those services. I believe that the contract is complete. Is that right?

Embry: 00:33:08.189 Good morning. I’m Amy Embry. I’m the director of the State Medical Board. Yes. That is complete.

Dotson: 00:33:15.336 All right. And since I was the one that requested you to be here, could you speak to the fund balances that you have, kind of the general theme of the day, it seems like? What’s your plan with that and going forward? It’s kind of a large fund balance it looks like.

Embry: 00:33:35.235 Yes. Currently, we have $12.5 million. We do have proposed legislation that will allow us to reduce fees. Nearly all of our fees are in code. So any change, whether we go up or down, would require legislation. The legislation we’re putting forward would give us the flexibility to lower these fees and not go any higher than what they are. Again, that’s proposed legislation. That will be a decrease in revenue coming in. Also we’re using the fee waiver that was passed in the last session. We have had some applications that have come in that will decrease our revenue. We are going to have some increase in cost, in particular, IT costs. We’re in the very beginning stages of that so there will be some increases. And we’re going to attempt to work with the appropriation we have but we’ll see what we can do.

Dotson: 00:34:23.347 Excellent. Thank you. Representative Wooten, you are recognized.

Wooten: 00:34:29.592 Am I looking at this right? On page 117 you have budgeted 41, you have 1 position filled and you’re showing a million dollars. You paying someone a million dollars?

Embry: 00:34:43.815 No Sir. That was a typo.

Wooten: 00:34:48.085 A what?

Embry: 00:34:48.737 That was a typo. In the number of positions, if you look at the budgeted and the authorized, they’ve had 41 positions for quite some time. That literally was a typo in the actual expenditures.

Wooten: 00:34:58.606 So my follow-up, I got an additional question. You’ve got 16 vacant positions, 11 of them, or 70%, are over two years old. What are those positions and why do you keep holding on to them?

Dotson: 00:35:16.873 Representative, I think staff might be able to speak to that.

Anderson: 00:35:28.742 You’ll see, Representative Wooten, I just want to make sure we’re clear, that as Mildred said, they are surrendering those positions that you’re talking about for the next coming year. They’re just showing up in the manual because they were previously authorized. I don’t know if that answers your question but they are surrendering the positions that were two years old and they request they will go away.

Embry: 00:35:52.128 These were positions that had been identified as vacant and we went ahead and surrendered them but they’re just showing up in the book.

Wooten: 00:35:57.805 Okay. All right. Thank you very much. That’s what I want to hear.

Dotson: 00:36:02.397 Seeing no further questions, motion? I’ve got a motion. Second. All in favor? Any opposed? Motion passes. Thank you. And going to State Psychology Board. Miss Hamilton, you are recognized.

State Psychology Board

Hamilton: 00:36:17.063 Thank you Mr. Chairman. We’re on page 154 of the manual. This is another cash and treasury appropriation funded with revenues derived from fees collected primarily for applications, testing, and renewal. In addition to approving the credentials of all the applicants and scheduling written examinations and investigating allegations of ethical violations, the board also is charged with implementing continuing education requirements. The agency’s requesting an increase, slightly, in regular salaries and match. And this is for some reclassifications, title changes, upgrades, and/or downgrades. As I mentioned before, the executive recommendation is essentially to keep everything the same and allow the new administration to determine whether or not they wanted to make changes. So, on page 155 you’ll see from the authorized fiscal year 2023 column, that there is a slight uptick in the agency’s request in the regular salaries and personal services matching line items, but you will not see that in regular salaries in the executive recommendation. You will see a slight increase and that was due to the personal services matching rate adjustments that we mention that took place during the biennium that are going to be moving forward into the next. That’s the executive recommendation agency’s request. Mr. Chair.

Dotson: 00:37:41.291 Thank you. Representative Cavenaugh.

Cavenaugh: 00:37:43.845 Thank you, Mr. Chair. Over here to your right. I want to talk about the fund balance, as you can imagine, because it’s almost seven years’ worth of fund balance. So what are we going to– are you all looking at reducing fees? What are you looking at doing on this particular one?

Gilmore: 00:38:00.651 Again, on this one, you can see it’s kind of starting to trend down. So we have cut some fees there. They’re going to make more cuts, hopefully, early next year when we go through rulemaking processes again after the session. They’ve also had some expenses around IT, but the plan is to move forward reducing those fees.

Cavenaugh: 00:38:16.644 Well, I know you show it going down, but if you look at what cash you brought in, it’s above what you projected. So I’ll go through the same process I went through earlier by another agency. If you give us real numbers of what you’re actually– what your projection is, is based on what you’re actually predicting, because you actually brought in $178,000 and you’re only projecting $112,000. So there’s disconnect between what you’re showing us for future. So that shows the fund balance going down, but in reality, it’s going up. So this fund balance will continue to go up.

Gilmore: 00:38:52.790 But, again, we’re going to, stress heavily, cut fees and reduce those further what they’ve already done.

Cavenaugh: 00:38:59.418 Okay. And if I can just ask real quick, do you have a backlog and how long does it take for you to get a application through?

Davies: 00:39:06.826 Colin Davies, director of Arkansas Psychology Board. We don’t have a backlog. We meet monthly, and the only thing that takes a while is for schools to send in a transcript. And we meet monthly and usually license people every month.

Cavenaugh: 00:39:21.929 Okay. All right, thank you.

Dotson: 00:39:24.112 Thank you, Representative Vaught.

Vaught: 00:39:26.250 Thank you. It’s me again. Been working with Mental health working group. There’s about 150 or more people working on this. How is your application? Is it online?

Davies: 00:39:38.057 Yes, ma’am, it’s completely online.

Vaught: 00:39:39.898 Okay. And you said you all meet monthly?

Davies: 00:39:42.139 Yes, ma’am.

Vaught: 00:39:42.975 What does your board handle? Does it handle policy, licensure, CEUs? What does it handle?

Davies: 00:39:48.594 All the above.

Vaught: 00:39:49.163 All the above. And can you explain your process for new graduates applying for first-time licensure and your renewal process?

Davies: 00:39:57.635 Yeah. So I’ll start with our renewal process. We renew every year. We started May 1st, and we end June 31st. So it’s a two-month renewal process that happens every year. And for a first-time applicant, we require that they complete an internship first at an accredited program, and we require 2,000 hours. And that’s the standard for all licensing boards for the other states. Then after that, we require them to be supervised for 2,000 hours at a mental health institute. Then once they receive the 2,000 hours, they can take their national exam, and we’ll register for them and they’ll coordinate with the national exam of when they want to take it. And once they pass the national exam, they’ll go before us for full licensure review. And if they complete everything, we’ll license them.

Vaught: 00:40:56.665 Okay. Again, a lot of complaints about your board and efficiency and how fast things get done. And so we need to work on our efficiencies. We really do, as board members. We’ve got to tighten up somehow. Thank you.

Dotson: 00:41:13.595 Thank you, Representative. Representative Wooten, you’re recognized.

Wooten: 00:41:16.929 Thank you. Mr. Chairman, I’ll be very quick. I want to request Ms. Mallory of the Health Department. You have the responsibility of overseeing all these agencies and boards in the Health Department. And we continually hear that, “We’re looking at it. We’re doing it. We’re going to do it. We’re taking down the fund balances. We’re looking at the personnel,” and all that. And I appreciate it, but we don’t see any direct, tangible results from any agency, not just you. This is throughout state government. So I’m going to ask if you would tell me, not today, but in writing, give us a statement of exactly how you’re dealing with the fund balances and how you’re going to continue to do work study, time studies on your personnel and give that back to us so that we have something to measure the results in the next fiscal budget because this is a repetitive problem. It’s gone on for 20 years, and it’s going to have to stop. These fund balances are too much, too great, 8 years, 10 years. And then you have positions that are five and six years old that are unfilled, and they’re still being carried. Not you. I’m just talking in general. But I’m going to ask each agency if that’s permissible, Mr. Chairman, to give us a written formula of how you’re going to go about reducing these funds, cutting fees, whatever it takes.

Mallory: 00:42:53.193 Yes, sir. I think we get the point. We’ve got it. We will get something. That will be our focus to get these fees down because I don’t want to sit here two years from now and be listening to the same thing. And I know you don’t want us to. So we’ve got it clear.

Wooten: 00:43:10.485 Thank you. Thank you.

Mallory: 00:43:11.360 Thank you.

Wooten: 00:43:12.229 Appreciate it. Thank you, Mr. Chairman.

Dotson: 00:43:13.438 Thank you, Representative. Senator Hammer, you’re recognized for a question.

Hammer: 00:43:16.755 Thank you. I’m going to direct this to Matt, if you will. You’ve been sitting here all morning, haven’t you?

Gilmore: 00:43:21.627 Yes, sir.

Hammer: 00:43:22.448 You heard what was requested of Director Basset and the boards that he’s over as far as a plan to cut it down similar to what the Representative has just mentioned. Could you get that for all the boards that you have jurisdiction over? And–

Gilmore: 00:43:37.041 We can work on that. But I’d like to say though, too, I think we’ve got evidence of where we have cut significantly on some of these boards, if it’s going to make a difference. So we’re working towards that. But I can get you something. Yes, sir.

Hammer: 00:43:48.371 So a three-year balance was what has been referenced previous to today. Do you feel that’s– do you feel that’s achievable as far as using a three-year average goal to get the fees reduced down to that carry forward? Or could they identify any unique qualities that maybe they had or have in what you’re going to present?

Gilmore: 00:44:09.247 I think it is. I think it is doable. And one thing with transformation, a lot of these boards we have brought in, and we’re getting familiar with them, getting used to them. And the way they license and operate and that sort of thing, it’s taken a few months to do that. We’ve also been in the middle of a pandemic. So I’d like to say that. But again, at the same time, as we’re bringing them in, we’re identifying savings. For example, we’ve moved, I believe, seven or eight boards into one of our buildings. And there’s no more rent there. So there’s savings that are identified there. So I think we can get down to a three-year average, something like that. And we can put together something like that and see what that would look like and get that to y’all. But I think transformation has helped. I think having the department of health involved overall has helped these boards quite a bit identify some efficiencies and also looking at ways we can help them to support them in their efforts.

Hammer: 00:44:56.408 All right. Thanks. Thanks, Mr. Chair.

Gilmore: 00:44:57.430 Thank you.

Mallory: 00:44:58.161 And not to belabor that. But I wanted to say that I didn’t want it to sound like we were making excuses. But we have worked with these boards very closely to fold them into our processes and our daily operations. And it’s just taken us a little while to assess all the things. And now we can start working on some other things. So thank you.

Dotson: 00:45:20.342 Thank you. Representative Wooten, a quick question, please.

Wooten: 00:45:24.348 I understand where you are because I’ve been there. I oversaw the Department of Commerce. And I understand that your statutory responsibility is fiscal and that their mission– or their statutory authority is outside your realm of overseeing. But there’s a thin blue line. But they’re answerable to you for the money and the mission and all they’re accomplishing the service. And so I understand where you are. It’s a thin line. But we need your help to get this under control. Thank you, Mr. Chairman.

Dotson: 00:46:05.215 All right. Seeing no further questions. We have the motion. A motion and a second. Seeing no discussion, all in favor aye. Any opposed? Motion passes. Thank you. And that takes us to our final one, Social Work Licensing Board. Ms. Hamilton, you’re recognized.

Hamilton: 00:46:24.666 Thank you, Mr. Chairman. Members, we’re on page 157 in your manual. This is the Social Work Licensing Board funded with special revenues. These are the collection of application and license renewal fees that are authorized in statute. They are responsible for regulating the practice of social work in Arkansas. And that’s essentially what this appropriation does. With the exception of regular salaries and personal services matching, they’re asking for continued level of appropriation for the upcoming biennium. You’ll see their detail on page 158. You’ll note the slight increases, as I’ve mentioned before, in regular salaries and personal services matching due to the rate adjustments that occurred in the previous biennium. They also receive some pay plan adjustments through Peer back in April of this year. So the agency requests and the executive recommendation moving forward are for the values that you see there. Thank you, Mr. Chairman.

Dotson: 00:47:21.473 Thank you. Representative Cavenaugh, you’re recognized.

Cavenaugh: 00:47:23.981 Thank you, Mr. Chair. Again, this is another one with the fund balance that we need to work on. And so I’m not going to go on to that one. That’s just another one. Can you tell me how many licenses that you do? How many people have you got licensed as social worker?

Bain: 00:47:41.379 Yes, ma’am. I’m Ruthie Bain with the Social Work Licensing Board. I’m the director. We currently have 4,197 social workers.

Cavenaugh: 00:47:49.960 Okay. And what is your fee to be licensed?

Bain: 00:47:53.304 We have a $100 application fee and a $80 renewal fee.

Cavenaugh: 00:47:58.087 Okay. And do you have any backlog? And how long does it take for you to actually get your applications processed?

Bain: 00:48:05.680 We’ve recently made some changes, and we’ve had licenses issued within five days. The ones that take a little bit longer are usually on the applicants’ part because they’re not turning in the proper paperwork. It can be anywhere from a week or more to a couple of months but we follow up regularly with each applicant to make sure they’re getting their items turned in to try to get them licensed as quickly as possible.

Cavenaugh: 00:48:34.450 Okay. And is that five days after the board approves them, is that what we’re talking about?

Bain: 00:48:40.243 We have recently implemented some changes where staff is actually approving applicants now and the board just reviews them at the monthly board meeting. But with the staff actually approving applications, if they get their application and required paperwork in, we can get them out as soon as they qualify, and they do not have to wait for the next monthly board meeting.

Cavenaugh: 00:49:03.308 Okay. Thank you.

Dotson: 00:49:06.197 All right. Representative Vaught.

Vaught: 00:49:08.927 Thank you, Mr. Chair. Again, mental health working group, lots of complaints about lost paperwork and things like that, which keeps people from being certified, I guess, sooner or licensed sooner. Can you tell me what policy– do y’all handle policy and licensure and CEUs, or what do y’all handle as a board?

Bain: 00:49:30.301 Our board does a little bit of all of it.

Vaught: 00:49:32.670 Okay. And can you tell me the process of renewal and if somebody is new, what the process is for them to get licensed?

Bain: 00:49:40.796 Yes, ma’am. The renewal is the easiest. The licensees can go online. They submit their 30 hours of continuing education. The board staff reviews it. If they’ve met the requirement, we issue the license that day and send it out to them. The licensed applicants apply online. And the majority of the cases, we send them information for their background check. If there’s a new applicant– brand new graduate has to turn in their transcript, complete their background check, and we issue them a provisional license right away. Out-of-state applicants have to turn in a couple of more items. As mentioned before, we follow up with them regularly to make sure they’re getting their items in so we don’t have much of a backlog and try to get them issued as quickly as possible.

Vaught: 00:50:29.053 Can you tell me the average turnaround?

Bain: 00:50:31.676 With our new process, it’s been from a couple of weeks to a couple of months.

Vaught: 00:50:37.307 Okay. Thank you, Mr. Chair.

Dotson: 00:50:39.130 Thank you. Representative Wooten, you get the final question.

Wooten: 00:50:42.136 Yes. sir. Thank you. How many members are on your board?

Bain: 00:50:46.584 We have nine board members.

Wooten: 00:50:48.097 Nine. And how often do they meet?

Bain: 00:50:51.554 We meet once a month.

Wooten: 00:50:52.547 Once a month. Okay. Thank you, Mr. Chairman.

Dotson: 00:50:58.735 I got a motion for executive rec and a second. All in favor, aye. Any opposed, nay. Motion passes. Thank you. Appreciate you, members. We’ll be back here next week at 9 o’clock. We’re adjourned.