Budget Hearings

November 15, 2022

 

Rep Wardlaw: …Language report. Representative Cavenaugh, you are recognized.

 

Rep Cavenaugh: Thank you, Mr. Chair. The Special Language Subcommittee met on Wednesday, November 9, at 1:30 p.m. and reports the following actions: one, the subcommittee adopted executive recommendations for the agency language listed. The subcommittee adopted institution request for the language recommended by the institutions of higher education and approved by the Higher Education Coordinating Board. The subcommittee adopted legislative recommendations for certain pieces of agency language. Two, agency institution and legislative recommendations that were revised are noted in the report with a motion to codify additional compensation for athletic departments for all four-year institutions in the Division of Higher Education appropriation bill, and those will be attached for items A through F. And with that, I move for adoption of the report.

 

Rep Wardlaw: I have a motion and a second. Do I have any discussion? Seeing none, all those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. With that, we’ll move on to item two. It’s a letter from Department of Transformation and Shared Services. And Kevin, you are recognized.

 

BLR Staff: Thank you, Mr. Chairman. This is item B(2). This is a request by LPM to include the attached positions on page two in the fiscal year 2024 draft appropriation bills. What this is is growth pool or surrender pool positions already approved by ALC and its Personnel Subcommittee but were not included in the budget request due to timing. Adoption of this letter will allow staff to include these positions on page two in the draft bills.

 

Rep Wardlaw: I would need a motion. I have one. I have a second. Any discussion on the motion? Seeing none, all those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. With that, members, we’re going to jump out of the agenda for a second. Suspend the rules. Do I have a motion? I have a motion. I have a second. All those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. So with the suspension of the rules, we made a motion a few weeks ago to move some stuff from the Auditor’s Office to Administrative Courts. We were able to work with both sides to figure out the right language to put the controls in place to make sure travel reimbursements are being done correctly. You guys can look at Marty Sullivan. He’s shaking his head back there. All parties worked together. With that, we were able to put some language together for special language. We will be moving that back to the Auditor’s Office with some provisions. So with that, I’m going to recognize Representative Cavenaugh for a motion.

 

Rep Cavenaugh: Thank you, Mr. Chair. I make a motion to expunge the vote by which appropriation 009 constitutional officers were revised to change the disbursing officer for this appropriation from the Auditor of the State to the Administrative Office of the Courts.

 

Rep Wardlaw: That’s a proper motion. Do I have a second?

 

Audience: Second.

 

Rep Wardlaw: I have a second. All those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. Representative Cavenaugh, you’re recognized.

 

Rep Cavenaugh: Yes. I make a motion to adopt the agency request for appropriation 009 constitutional officers, which keeps the Auditor as the disbursing officer, and adopt the special language in the handout to be included as a new language in the general appropriation bill. This language allows the Auditor of State to review travel expense reimbursement for judges for accuracy and consistency with applicable travel guidelines.

 

Rep Wardlaw: Thank you. That’s a proper motion. I have a second? Any discussion on that motion? Seeing none, all those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. So with that, we’ll move on to– yes. Kevin, you’re recognized?

 

BLR Staff: Mr. Chairman, we also have– our handout’s already on your desk, and this is just for committee’s information. These are on the number of positions eliminated and vacant for two years, and those are two letters from Kay Barnhill on your desk already. And no action is required, Mr. Chairman.

 

Rep Wardlaw: Thank you. Members, before we go into Department of Human Services, there were a number of audit findings that have all been brought to the Audit Committee. It’s about 50 pages, be a guess. Instead of having Audit go through an hour report of the 50 pages that have already been heard, I would sit at this moment and give you guys a second. If there’s a question you have for Audit, Audit is in the room and willing to answer those questions on those findings. With the pleasure of the committee, I would like to just ask them questions and not hear the whole report. Seeing no questions, we’ll move on to DHS and we’ll hear from Secretary White. And Ms. Walls will be the presenter. Ms. Walls and Mr. Secretary, if you guys would introduce yourself for the committee, and then, Ms. Walls, you’re recognized to begin.

 

White (DHS): Thank you, Mr. Chairman. Mark White, Secretary, Department of Human Services.

 

BLR Staff: I’m Lilah Walls with the Bureau of Legislative Research. Thank you, Mr. Chair. Per the chair’s instructions, I’ll be presenting at a very high level and staying on the department appropriations summary pages for each of these divisions. If it pleases the Chair, I will present the Shared Services appropriation with the Secretary’s office. And that appropriation is on page 3 of your manual. This is for their Shared Services appropriation. This is for the salary and matching for the Secretary’s position, and it’s for approximately $350,000 in each fiscal year. The agency’s requesting slight changes for matching, and the executive recommendation provides for the agency’s request in this instance. If you’ll turn with me to page 6. This is the department appropriations summary for the Secretary’s office. It has authorized appropriations of $83.4 million with 672 authorized positions, utilized across the department in four appropriations, and they’re requesting approximately $85 million in fiscal year 2024 and $85.5 million in fiscal year 2025 with changes in one appropriation. If you look at the top box on line 3, it says 896 DHS admin paying account. This is their operations appropriation. They’re requesting slight increases in salary and matching for changes made during the interim and a $400,000 shift from the professional fees line item to the capital outlay line item to better support the other divisions of the department, and the executive recommendation provides for the division’s request. And this concludes my presentation for this division.

 

Rep Wardlaw: Representative Cavenaugh, you’re recognized.

 

Rep Cavenaugh: Thank you, Mr. Chair. Thank you all for being here. I’d like to make a request, and I’ve spoken to you about this. Just want to make sure that you’ve got– because we get it briefly. I’d like you to provide me with a report that shows the fund balance, the source of the funds, any restrictions of those funds of how they can be used, and whether it’s cash, special revenue, GR, or federal. If you could get that report to me, I’d appreciate it.

 

White (DHS): Yes, ma’am. We’re pulling that together now, and we’ll get that to you shortly.

 

Rep Wardlaw: Any further questions on number one or number two? Seeing no questions, do I have a motion for executive rec? I have a second? I have a second. Seeing no discussion, all those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. With that, Miss Walls, we’ll go to number 3.

 

BLR Staff: Thank you, Mr. Chair. The next division we’re going to talk about is the Division of Aging, Adult, and Behavioral Health Services, and their department appropriation summary is on pages 17 and 18 in your manual. This division has total authorized appropriation of approximately $270 million with 1,163 positions and 10 appropriations. They’re requesting approximately $273.6 million in fiscal year 2024 and $273.9 million in fiscal year 2025 with changes to one appropriation. If you look on line 5 of the summary, which is about a quarter of the way down in the big top box, that’s their operations appropriation. They’re requesting slight increases to salary and matching for changes made during the interim and slight increases in their operating expenses and professional fees line items for increased cost for food service, medical fees, and pharmacy fees, and that’s primarily occurring at the Arkansas State Hospital. The executive recommendation provides for the division’s request, and this concludes my presentation for this division.

 

Rep Wardlaw: Representative Fite, you’re recognized.

 

Rep C Fite: Mr. Chairman, mine is on page 32. We’re not there yet. We are? Okay. This the appropriate time? I would like to make a motion that we increase the funding for the senior centers from the current $8 million to $10 million. Our senior centers are really struggling all over the state. They’ve had a triple whammy with food, with travel, and with minimum wage going up, and they need $10 million.

 

Rep Wardlaw: Okay. And this is on the appropriation only, correct?

 

Rep C Fite: Correct.

 

Rep Wardlaw: Okay. Committee, this is not a motion for the entirety section. This is only a motion for this line item on this appropriation on 898. Do I have a second? I have a second. And do I have discussion on this motion? Any discussion? Representative Vaught?

 

Rep Vaught: Thank you, sir. I appreciate you recognizing me. I totally agree. Is there a way to make sure that this actually gets to our centers and not to admin? That’s my biggest question in all of this is how much admin gets versus how much my senior citizens are having. How much actually goes to the center because I have centers that are doing fundraisers every month trying to pay for meals for people when in reality, I think that’s a disservice to this program in itself.

 

White (DHS): Yes, ma’am. So for this money, this would flow through the Area Agencies on Aging and would flow according to the distribution formula we use to distribute the normal AAA funds around the state. And so that’s based on population and several other related factors. Once it gets to those AAAs, it’s up to each AAA to determine how that is distributed within their area. Most of them use a similar formula, but not all of them do that. But the constraint for us is that there is special language that says that funding that flows through this appropriation must be distributed in that same way as those normal AAA funds.

 

Rep Vaught: Okay, again, my question is, though, how do we make sure it actually gets to centers and not to administration? I think we have the admins that are making way more money than what they should be making versus the amount that’s actually being spent in our centers.

 

White (DHS): We do have some authority over the plans that each AAA files for how they’re going to spend their funding. They have to do that, submit that to us. It’s called an area plan, and that outlines exactly how that money is going to be distributed and spent in their area. We do have to approve those, but we don’t have full discretionary authority over those approvals. So I would say that with our current authority right now, we can use that somewhat. I don’t know if I can promise you that we can absolutely make sure that every dime gets to those senior centers with our present authority.

 

Rep Vaught: Then we need to look at that authority and fix that authority because it is a disservice to every senior in our state who is having to do fundraisers to make sure that they can feed people within their centers when we’re giving now $10 million to our centers and the amount that’s getting to our centers is not near what it needs to be compared to how much I believe is being spent in our administration. Thank you, Mr. Chair.

 

Rep Wardlaw: Representative, sitting here thinking through all the options, and I asked Kevin, could we get something done in the next hour while we’re in here? But it seems like session’s probably the right place. But special language needs to be written up to restrict the percentage amount that could be used for admin. So maybe a 5% or whatever is happy for you, but you would be able to do that in special language to attach to this to make sure if funding came with that appropriation, none of it could be used for admin above that percentage, and that would fix that problem. Any other questions? Representative Wooten, is there a question on this motion?

 

Rep Wooten: No.

 

Rep Wardlaw: Okay, I’ll hold you in the queue. Senator Hammer, are you on this motion? We can’t ask them any questions. We’re within a motion. So this is only discussion amongst the members. Representative Cavenaugh, do you have a question on this motion?

 

Rep Cavenaugh: No, I have a question for the next.

 

Rep Wardlaw: Okay. Seeing no further discussion on this motion, all those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. So with that, we’ll go back to the questioning on item 3. Representative Cavenaugh, you’re recognized. Senator Hammer, if you would get back in the queue.

 

Rep Cavenaugh: Thank you, Mr. Chair. My question is going to be dealing with the senior citizens but not with the motion. So in my area, we don’t have senior citizen centers through AAA. So how do we in rural Arkansas get some of this $10 million that we’ve just made the appropriation for to those areas that don’t have AAAs? I mean, we have senior citizen centers, but they’re not part of the AAA agencies. So they’re not getting any funds, and they’re out there having to raise money privately. But we still have all this money to go to senior citizens, but it’s only going to one organization. But there are a lot of centers that are not part of those agencies, so how do we get money to them?

 

White (DHS): For any senior center that is not operating under contract with AAA, our special language would have to be changed to allow for us to devote funding to that entity. Now, I will say that the vast majority of the senior centers are operated under contract so that the AAA contracts with an outside vendor or outside nonprofit, sometimes a government agency, to operate those senior centers. So very often there is a relationship there and there is funding provided. But with that said, for it to be outside of that system, the special language would have to change.

 

Rep Cavenaugh: Okay. Kevin, did you hear that? Okay. Just make a note that I’m going to want some special language. If you’ll flag this for session. I appreciate it. Thank you.

 

Rep Wardlaw: Senator Hammer, you’re recognized.

 

Sen Hammer: Thank you. Over here. Afternoon. May have been a little distracted, so I don’t think you just answered this question, but the decision as to what the administrators get paid at each individual center, who makes that final decision?

 

White (DHS): That is made by that AAA and their governing board or entity.

 

Sen Hammer: So it’s handled at what we would refer to as the local level. So they currently have the ability to adjust what they pay administration now without us being involved, is that correct?

 

White (DHS): That is my understanding.

 

Sen Hammer: Okay. So they could take it to the local level and confront the directors or they’re overseen by a board, I guess, and deal with it at that level, is that correct?

 

White (DHS): I believe so.

 

Sen Hammer: All right. Thank you.

 

Rep Wardlaw: Representative Wooten, you’re recognized.

 

Rep Wooten: Thank you, Mr. Chairman. Mr. Secretary, on all your fund balances– pursuing Representative Cavenaugh’s report she requested, I also would like a report from you all on your interest and where it’s located in your budget and the dollar amount. I’m not necessarily interested in the breakdown by the individuals but the total interest for the department. And then I have a question. On the report I have, it shows that you have 1,704 vacant positions, and of those, only 24 are over two years old. Is that correct for the whole department?

 

White (DHS): Let me turn back to my HR person. I believe that is correct.  Yes. Yes, sir. That is correct.

 

Rep Wooten: Okay. In the last session, we gave you 109 more new positions for Family Services. How many of those have been filled?

 

Smith (DHS): Hi, Representative Wooten. Keesa Smith, Deputy Director for GHS. So we actually did pull that information before we came over. So out of those 109 positions, currently, as of today, we have 26 filled positions, but we also have 21 where we’ve either extended a job offer to the individual or we are awaiting their background check. Now, I would note this is as Pulaski County, and we have had individuals fill those positions and equally have had individuals leave those positions during that time. But right now, we’re about half filled of those positions, a little bit under half filled.

 

Rep Wooten: Of those positions?

 

Smith (DHS): Of those 109. Yes, sir.

 

Rep Wooten: Okay. Are you able to pair them up like Ms. Martin indicated you were going to pair them up when they were doing their investigations with the ones you’ve hired?

 

Smith (DHS): We are trying. We’re having a lot more success in hiring program administrators who are the individuals that are– excuse me, program assistants who are the individuals that are providing support services. So we’re still not fully in the teaming mode, but we are trying our best to get there.

 

Rep Wooten: All right. Thank you, Mr. Chairman. Thank you all. Thank you.

 

Rep Wardlaw: Representative Cavenaugh, you’re recognized.

 

Rep Cavenaugh: Thank you, Mr. Chair. I’m going to ask a question on page 24 and 39. It’s dealing with the mental health grants. On 24, what type of grants are we giving out with this money?

 

White (DHS): So for this money, this money goes to our community mental health centers.

 

Rep Cavenaugh: Okay. And are we expecting the $23 million from the federal– I think, sorry, it’s $20 million. How do we arrive at that? In 2022, it was $4.8, but we’re projecting it to be $20.1 million in 2024. How do we arrive at that number?

 

White (DHS): And can you point me to which line you’re looking at?

 

Rep Cavenaugh: Oh, sorry. On your federal revenue, if you’ll look down for 2023-2024, you’re projecting your revenue to be $20.1 million for the federal part. How do you all arrive at that projection number?

 

Staley (DHS): Dawn Stayley, Deputy Director and Medicaid Director. So that number is really based on what ultimately we receive from the federal government because that chunk of money flows through us as a Mental Health Block Grant from the federal government. And so we project what it is going to be based off of historical expenditures, but that amount does vary just depending upon what the federal government decides to give states from a year-to-year basis.

 

White (DHS): And I would add that that number also has been affected by the one-time COVID money that the federal government has been distributing to us through that same mechanism.

 

Rep Cavenaugh: Okay. So in 2022, what we actually got was $4.9, but you’re saying that in 2024 we’re going to get $20.1. Is that overinflated because of all the COVID and ARPA monies?

 

White (DHS): I don’t believe so. I think we’ve adjusted it for that. But as Director Stayley indicated, there is a little bit of uncertainty on that in that it comes in a variety of words, all in different amounts, all at different times, and that’s not a consistent flow from the Feds, unfortunately.

 

Rep Cavenaugh: Okay. And on 39, this is the Vet Mental Health Grant, and it’s an unfunded appropriation. My question is on this. On our tobacco settlement money– and we have fund balances everywhere on our tobacco settlement monies– can that fund not be used to fund this?

 

White (DHS): I can’t speak specifically for that tobacco settlement money. My assumption would be yes. But since we’re not directly responsible for those funds, I’m more hesitant to commit to that. I will say for the appropriation, absolutely, we could use that because we put this appropriation in place back– we had some CARES money they were able to use for it. And if we could find some additional funding for it, that would be wonderful.

 

Rep Cavenaugh: Okay. And Kevin, if you don’t mind, flag this one also for session. Appreciate it.

 

Rep Wardlaw: Seeing no further questions for part 3, I’ll take a motion executive rec. Yeah. It’d be a motion for the executive rec with an exception for Representative Fite’s motion. I have a second? I have a second. All those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: Ayes have it. So with that, Miss Walls, we’ll move on to number 4.

 

BLR Staff: Thank you, Mr. Chair. The next division we’re going to talk about is the Division of Childcare and Early Childhood Education, and their department appropriation summary is on page 55 in your manual. This division has an authorized appropriation of $174.9 million with 181 positions and seven appropriations, and they are requesting approximately $175.3 million in fiscal year 2024 and $175.4 million in fiscal year 2025 with changes in two appropriations. If you look on line three of the summary, it’s about a third of the way down in the big box. This is their operations appropriation, and they’re requesting slight increases in salary and matching for changes made during the interim and a $2 million increase in professional fees for both years to support technology systems improvements and replacements. And on line 5, it says, 898, Save the Children. The division is requesting the discontinuation of this appropriation. An appropriation for this purpose is also included in the Department of Education, and it has been determined to be a better fit there. And the executive recommendation provides for the division’s requests. And this concludes my presentation for this division.

 

Rep Wardlaw: Representative Cavenaugh?

 

Rep Cavenaugh: Thank you, Mr. Chair. My first question is going to be on page 61 for your upgrade and technologies. Can you tell me what you’re going to be upgrading?

 

White (DHS): Okay. Let me bring Tonya Williams who’s the division director up here and she can speak specifically to that.

 

Rep Cavenaugh: All right. Thank you.

 

Williams (DHS): I’ll make sure that you can hear me before I start speaking. Tonya Williams, Director at the Division of Childcare Early Childhood Education. We have really changed almost every system that we work in. Many of you may be aware that we automated background checks in the middle of the pandemic. We are in the current process of upgrading our technology for the nutrition program. This one is specifically for childcare. We have a system that’s been in place since 2006, so we’d like to bring that up to some modern technology, and we do have federal funds to do that. So it would be for the childcare for the eligibility for families as well as the payment. We have automatic payments currently with providers. They bill and get paid directly and there’s no paper, but we would like to bring that up. It’s very old technology. I think we will also add a feature where parents can see if there’s an opening at a childcare. Currently, they can see where all the childcares are, but they don’t know if there’s an opening, so they have to call the list of providers in their community. And we’d like to add a feature for families to be able to see where providers can put in any openings that they may have. So that’s really what we’re talking about in terms of upgrades.

 

Rep Cavenaugh: Okay. So what’s the difference between that and data processing?

 

Williams (DHS): Well, this is really upgrading the technology platform that it’s on. The current system that we have was built with older technology. And let me just say, I’m not the technology person in the room here, but it’s very antiquated, and we can’t do a lot of the features that I was talking about where parents can see real-time openings. Data processing to me is more about looking at data. Lots of data goes into a system and you’re looking at it. This is being able to enter information by the program, by the parent, and then determining eligibility from that, so. I don’t know if that really answers your question. If we need to get the IT folks here, I’m happy to-

 

White (DHS): And I’ll just add to that. Thank you. In recent years, that data processing appropriation line has not been used very much. Typically, most expenditures have migrated to other appropriation lines.

 

Rep Cavenaugh: Okay. So do we need to keep that appropriation line if you’re not using the data processing line?

 

BLR Staff: Representative Cavenaugh, that is one of the standard lines of maintenance and operations. It’s in all of maintenance and operations because they’re essentially in the bills as a group and you can’t get rid of it. There have been instances where we have added a data processing services line item that a lot of those types of expenditures have migrated to, and they don’t have that in– or they do have that in this appropriation. It’s down at the bottom. But that data processing line item is just part of maintenance and operations.

 

Rep Cavenaugh: Okay. All right. And on page 63 on the grants that we’re going to be giving out for childcare, how do these grants get given out?

 

Williams (DHS): There are a couple of different ways. We have providers in Arkansas that are licensed that get incentive grants when they meet levels of quality. We also have grants for contractors who do professional development that’s required by the federal block grant. And those would go– those are all typically university systems or education co-ops. I think that covers most of them, Representative Cavenaugh.

 

Rep Cavenaugh: So these grants aren’t necessarily going to the actual providers but for people to monitor and train the providers?

 

Williams (DHS): Well, train the providers, but there’s probably at least a million or $2 million that goes directly to the providers as incentive grants.

 

Rep Cavenaugh: Okay. If you don’t mind, if you will give me a list of where these actual grants go to and aid so we know where they’re actually given out to, I’d appreciate that. Thank you.

 

Rep Wardlaw: Representative Springer, you’re recognized.

 

Rep Springer: Good afternoon. Thank you, Mr. Chair. My question is, where is the budget appropriation for the voucher program where you pay the childcare centers?

 

Williams (DHS): It would be in two places, Representative Springer. It’s on probably page 57 in your book, Childcare Development Discretionary. That predominantly is used for children who are eligible for Vouchers Childcare, low-income children whose families meet the work and/or training or school requirements. And then on page– come on, let me find it. On page 63, the grants paying account. There are some vouchers that will be in that. There’s a portion of the federal block grant that is mandatory, and it is for children who are on TANF or foster care. Some of that is paid out of that particular category.

 

Rep Springer: Thank you. Were you made aware that, in our meeting yesterday, that I had some concerns about– oh, you got the information for me? Okay, wonderful. All right. So if you would share that, I would appreciate it. Thank you. Dr. Smith. I’m calling you doctor. Thank you. Appreciate you.

 

Rep Wardlaw: Seeing no further questions. Do I have a motion for item 4? I have a motion. I have a second. All those in favor, say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? Ayes have it. With that, we’ll move on to item 5. Ms. Walls, you’re recognized.

 

BLR Staff: Thank you, Mr. Chair. The next division we’re going to talk about is the Division of Children and Family Services, and it’s on page 72. The department appropriation summary is on page 72 in your manual. They have authorized appropriations of $301 million with 1,389–

 

Rep Wardlaw: Ms. Walls, can you get closer to that mic, please?

 

BLR Staff: Sorry. Do you want me to start over, sir? Okay. With 1,389 positions and seven appropriations. And they’re requesting approximately $315 million in fiscal year 2024 and $316 million in fiscal year 2025, with the following changes. If you look on lines two and four, there’s a line for foster care and a line for TANF foster care. They’re requesting on line two, for the foster care appropriation, an increase of $5.2 million in both fiscal years. And for the TANF foster care appropriation, on line four, they’re requesting $4.9 million in both fiscal years, and those are for increases in board payments to foster parents. If you look on line three, where it says Division of Children and Family Services, that is their operations appropriation. And they’re requesting increases for salary and matching that are associated with 30 pool positions being permanently added and other changes that were made during the interim. And on line five, it says DHS – Children’s Trust Fund, and this is the appropriation, and they’re requesting slight increases for salary and matching. And that’s the agency’s request. The executive recommendation is slightly different. They’re providing for the division’s requests with the following exceptions. In the operations appropriation on line three, the salary and matching that’s associated with reclassifications is not recommended. In the Children’s Trust Fund appropriation on line five, they are recommending the discontinuation of the position associated with that appropriation and the associated salary and matching in that appropriation. And on line seven, at the bottom, where it says Parent Council federal, they’re requesting the discontinuation of this appropriation. The division operates under an MOU with the Public Defender Commission and transfers applicable funds to be expensed there. So this appropriation is unnecessary. And this concludes my presentation for this division.

 

Rep Wardlaw: Representative Fite, you’re recognized.

 

Rep C Fite: Thank you. Mr. Chair. Could you please tell us more about safe harbor for SEC?

 

White (DHS): If you can give us just a moment, Representative Fite, we’re just double-checking our memory here.

 

Smith (DHS): So Representative Fite, I’m sorry for the delay. We were trying to remember. So Safe Harbor, that’s actually the fund that we utilize that receives funding for human trafficking victims. And so historically, we haven’t had a significant amount of funding in that funding area. And so typically, we have provided that as grants to the few entities across the state that actually house human trafficking victims and provide care for them.

 

Rep Wardlaw: Representative Cavenaugh.

 

Rep Cavenaugh: Thank you, Mr. Chair. My first question is going to be on page 76 dealing with foster care. And I know we just increased our board payment, and I’m assuming that’s reflected in this appropriation. And I’d like to know, when we were looking at upping the board payment, did we see how we compare to the states around us for payment on foster care?

 

White (DHS): I’ll make a couple of points, and then Ms. Smith may want to add on to that. So two things we did around the board payments. One was that we expanded the availability of payments. Not actually board payments, but payments to provisional foster homes. And those are just– if we place with a family member, it takes them a little time for them to get fully certified. And so we’ve got something in place now where we make a smaller payment to them as a start. Our intention is, in the next fiscal year, with the funding, we want to make full board payments to those individuals. And there will be legislation coming to you all in the session to accomplish that. And then, secondly, wanted to raise all board payments across the board 10%. And that was something that the governor directed us to do. I’m not sure if we looked at other states or not.

 

Smith (DHS): No. And the only thing that I will add is that we haven’t increased our board payment since 2009. So what we were looking at is doing an increase for our families. We didn’t necessarily–

 

Rep Cavenaugh: Right. Is there any way we could look around the states around us? Because my gut feeling is we’re still below many of the surrounding states. And as we know, we have so many children in foster care that it’s hard sometimes to find foster parents because a lot of them can’t justify some of the expenses coming in. As you and I have talked many times, a lot of these children have really special needs at this point and issues. And so that’s why I was kind of curious about that. If you could find that out for me.

 

Smith (DHS): Absolutely.

 

White (DHS): Yes.

 

Rep Cavenaugh: And on page 79, I just want to ask you– you’ve got a transfer on a reallocation of resources for like $4.5 million. Where does that get reallocated to? It’s going to be down there in your funding sources.

 

White (DHS): Let me tell you my understanding, and then someone can correct me if I’m wrong. During the year, we do those reallocation resources, and typically that is where DCFS is paying out for services provided by another division. So for example, they transfer funds to the division of county operations to cover rent on the offices where they’re located in. And so we do that to spread those expenses around, make sure that we’re allocating them to the right both state and federal funding sources.

 

Rep Cavenaugh: Okay. And the $3.4 to state police, is that for the hotline?

 

White (DHS): That is for both the hotline and the Crimes against Children Division.

 

Rep Cavenaugh: Okay. And on your professional fees, your actual spend was $19.4 million, but you’re asking for $33.2 million. Why such an increase compared to what our actual spend is, and what gets lumped into that as professional fees?

 

White (DHS): That is for the development of the new IT system for child welfare, which is what’s called CCWIS. We’ve renamed it. Our Focus is what the new name will be. But we’re in the midst of that now. We have a vendor that was procured through a competitive contract. They’re working through that, and that increased cost just reflects those costs we expect to incur.

 

Rep Cavenaugh: Okay. And on 87, this is going to be the Parent Council. So I notice that you had federal revenue and then you did an Interagency Transfer Fund. Where did that get transferred to?

 

White (DHS): To the administrative office of the courts.

 

Rep Cavenaugh: Okay. Is that where that always goes to? Are you just a pass through?

 

White (DHS): Yes.

 

Smith (DHS): Right.

 

White (DHS): It’s passed through.

 

Rep Cavenaugh: Okay. Thank you.

 

Rep Wardlaw: Representative Wooten.

 

Rep Wooten: Mr. Secretary, you’re requesting, apparently, 32 new positions in this division on page 72.

 

White (DHS): That is not 32 new positions. It’s positions you all have already granted in the interim, and we’re just seeking to make those permanent.

 

Rep Wooten: Okay. All right. Next question. Back on the Parent Council federal money, you didn’t use any, but you got an authorization of $2.5 million. Are you not using it or are you not getting the money? Is this appropriation just so if you get the money, you can spend it or–?

 

White (DHS): No, we have been making the funding to, for the Parent Council using a mix of both state funds and federal funds. It’s just being moved to a different place in the budget.

 

Rep Wooten: Okay. All right. Thank you. Thank you, Mr. Chairman.

 

Rep Wardlaw: Seeing no further questions. Do I have a motion? I have a motion. And a second. All those in favor say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed? The ayes have it. With that, Ms. Walls, we’ll move on to number 6.

 

BLR Staff: Thank you, Mr. Chair. The next division we’re going to talk about is the Division of County Operations, and their department appropriation summary is on page 90. They have authorized appropriations of approximately $180 million with 1,841 positions and nine appropriations. And they’re requesting $185.7 million in fiscal year 2024 and nearly $187 million in fiscal year 2025 with changes in two appropriations. If you look on line 5, it’s about the middle of that top box that says Medicaid Expansion – County Operations. This is their Medicaid tobacco settlement appropriation. And they’re requesting slight increases for salary and matching. And on line six, which is right underneath that, it says 896 Division of County Operations. This is their operations appropriation. This is for increases for salary and matching and shift of $6.2 million from their operating expenses line item to their professional fees and data processing services line items for the SNAP education and training case management contract and for IT-related costs. And the executive recommendation provides for the division’s request. And this concludes my presentation for this division.

 

Rep Wardlaw: Representative Cavenaugh.

 

Rep Cavenaugh: Thank you, Mr. Chair. My first question is going to be on page 95, and that is dealing with the Refugee Resettlement Program. We really have not been spending a lot of money in that, and I know it’s because we haven’t had a ton of refugees. I mean, what are we able to do with that fund balance? Because based on your spend, I mean, we have a large fund balance because you’re asking for appropriation for $12,000.

 

White (DHS): I want to double-check on that fund balance. And that may be just there was some federal money that was still in that account at the time, and that’s what made it appear larger. Typically, we don’t spend a lot of money through that because the only funds that we pay out to refugees is there’s a small cash payment that can go to those families for a temporary period of time. The remaining benefits they get typically come directly from the federal government or through Medicaid. And so it’s not a lot in there. I’m going to have to look back here and see if someone can address the fund balance issue.

 

Rep Cavenaugh: Or you can just get me that information. I mean, it’s not a large fund balance. But I’m just kind of looking at everybody’s fund balance. I’m trying to gather up these fund balances and see if there’s a way we can use them in another place more efficiently, is what I’m trying to find out.

 

White (DHS): Yes, ma’am.

 

Rep Cavenaugh: And on page 97, this is the City Homeless Assistance Grant. I’m assuming that the reason that this is actual higher than what you’re asking for your new appropriation is because of the COVID and ARPA funds that came through.

 

White (DHS): Yes.

 

Rep Cavenaugh: Okay. And could this be used for transitional housing? How we keep talking about transitional housing, could any of these funds be used for transitional housing?

 

White (DHS): If I can ask Mary Franklin from the Division of County Operations– I think I know the answer, but I’m going to defer to her.

 

Franklin (DHS): Good afternoon. I’m Mary Franklin, division director of Division of County Operations. There are four components. This is Emergency Solutions Grant funding, and so it is– oh, I’m so sorry. There are four components.

 

Rep Wardlaw: We’re still going to have to get you closer to the mic.

 

Franklin (DHS): My apologies. Is this better?

 

Rep Wardlaw: Yes.

 

Franklin (DHS): Emergency Solutions Grants, we can spend those funds in four components: for shelter operations, for homelessness prevention, which is rental assistance, rapid rehousing, street outreach, and a small amount for an admin. So I think whether or not transitional housing would qualify would depend on if it could be considered in one of those four components. We’d have to get more information and probably get you back a more definitive answer.

 

Rep Cavenaugh: Yeah, if you could, I’d appreciate that. And my last question is going to be on 101. This is the Medicaid Tobacco Settlement Program. I’m just curious. All the money that we’re using here, how have we actually improved the health of Arkansans through this?

 

Franklin (DHS): This appropriation is to help with the eligibility process for determining eligibility. The funding that DHS gets from the Tobacco Settlement Medicaid expansion programs is in four categories. It benefits seniors aged 65 and older through our Medicaid category called Our Seniors. And it benefits seniors whose income is at 80% the federal poverty level or below. It also increased our income limit for pregnant women coverage. So pregnant people who are approved in pregnant women category between 133 and 200 percent of FPL, that is one of those categories. And then there is hospital. There’s a hospital benefit attached to this for adults who are in the hospital there. It helps defray the out-of-pocket cost for individuals and helps cover the states share of some hospitalization costs. And then there are 500 slots in the Community and Employment Supports waiver, the DDS waiver program, that are funded by tobacco. So essentially, we are improving the health of Arkansans through that program by offering those services to individuals that we were not able to offer before the Tobacco Settlement Medicaid expansion program.

 

White (DHS): And if I can just add to two points. One, I always want to be explicit about that. That even though it says expansion, this is not the ACA Medicaid expansion population. Different group. And I always like to remind folks of that. The other thing, as Ms. Franklin referenced, this wasn’t one case where– it’s been, I guess, about two years ago that we switched the funds over to the DD waiver, where we had some funds that they weren’t being used, and we started looking back where it could better be used. And we used that to free up some slots for that waiver.

 

Rep Cavenaugh: Okay. And one thing that you said kind of caught my attention when you were talking about the levels of poverty that these people qualify for. So our elders are only at 80%. They can’t even be at 100% poverty?

 

Franklin (DHS): For that particular program, yes, ma’am. Now, we do have some other programs where it might be higher, like in our Medicare savings program where the state helps pay the Medicare premium and copays and deductibles. And then we also have our LTSS categories for those seniors that need additional services beyond regular state plan services, whether there being home and community based, our choices, or assisted living.

 

Rep Cavenaugh: Why do we set that at 80%? I’m just going to say, the elders in my area, I mean, they’re usually on fixed income, and we’re talking usually they’re well below. I mean–

 

Stayley (DHS): Right. So I would have to look back. This particular part of the language has been in statute for quite some time, I think probably when it was initially created. Really, the idea behind this program was that it was to be able to help individuals who might not otherwise be eligible for Medicaid. So otherwise, if they’re eligible for Medicaid, then they would be served through the traditional Medicaid program. But this was set up for seniors who might, for whatever reason, be ineligible, like Ms. Franklin’s example of a pregnant woman who potentially had too many resources. So that’s really kind of the history behind this. But we’re certainly–

 

Rep Cavenaugh: Pregnant women were at a higher rate than what even the elders were.

 

Stayley (DHS): Right. But certainly, we’re open to suggestions and recommendations on that.

 

Rep Cavenaugh: Yeah. If you don’t mind, if you’ll talk to me offline about that because I’m kind of curious why we’re short serving the elders. Thank you.

 

Rep Wardlaw: Representative Wooten, you’re recognized.

 

Rep Wooten: Me? Just sitting here meditating. On page 101, I have a couple or three questions. What do these 39 folks do? What are their job responsibilities, just in general?

 

Franklin (DHS): They support the eligibility determination process. So we have some caseworkers – the majority are caseworkers – and we have some clerical support and a few supervisors as part of these 39 individuals.

 

Rep Wooten: Okay. Is it an outreach program for cessation, for quitting smoking, or what?

 

Franklin (DHS): No, sir. They determine eligibility for Medicaid and other programs.

 

Rep Wooten: Oh, okay. All right. Okay. Okay. You have $34,000 average salary. And then the new request, it goes up to $42,000. So is that an $8,000 raise?

 

White (DHS): Where are you seeing that?

 

Rep Wooten: On page 101. Yes, 101. The average pay of the 39 is $34,000, and then it’s going to 40 positions with $42,000 average.

 

White (DHS): I would say that’s just the appropriation amount just to allow for where those salaries are at. But we’re not using this to raise anyone’s salaries. They still come in under the normal salary grids and other things that are in place for those employees.

 

Rep Wooten: Okay.

 

White (DHS): And the same as other eligibility workers within DCO.

 

Rep Wooten: Okay. Follow up, Mr. Chairman. On your matching services, you’re using 41%. Is that throughout the department or is–?

 

White (DHS): That’s my understanding, yes, sir. It’s consistent.

 

Rep Wooten: Okay. 41%. So actually, we’re using 28 in the personnel OPM, I think. So I guess we need to look at that from our standpoint.

 

White (DHS): Yeah, I know that typically the matching component– I think there’s a formula behind how that’s calculated. But essentially, it’s just from year to year, it adjusts just based on what the expected increase is. And beyond that, I can’t tell you.

 

Rep Wooten: Okay. All right. Thank you. Thank you, Mr. Chairman.

 

Sen Rice: Secretary White, can you give us a little bit of the process that you’re using for income verification on programs like SNAP and TANF and whether you feel those are going to be sufficient when you have to do the redeterminations when the federal health emergency ends?

 

Franklin (DHS): Well, we follow federal guidelines as far as verification of the SNAP program. Most everything in SNAP is required to be verified. Income is verified. Utility expenses or rent expenses, childcare expenses, medical expenses. SNAP requires verification, residence verification, identity verification. Now, in our other programs, it depends on what the regulations are related to those other programs. Some of Medicaid is– it just has to be considered compatible with our federal data source checks. And then other programs, it has to be verified. It depends on the category and the rules that regulate that category.

 

White (DHS): And we do use a variety of data sources for our programs, both those with the Division of Workforce Services, with the federal government, outside sources. We look at all those to do that income verification. And we do believe that what we have is in place is sufficient for the end of the PHE. Unlike a lot of states, we have continued to verify individuals and redetermine their eligibility throughout the Public Health Emergency. And so now we know which ones we have verified, which ones have not been verified. And so when the PHE ends, we can focus on that population and send them their notices and work to either get them verified or remove them from the program.

 

Sen Rice: Is this going to cause– when it ends, is it going to cause any kind of a mass that’s going to require extra staff, or do you have plans for that, or–?

 

White (DHS): It will be an additional workload. We’ve worked to accommodate that within our existing staff. But we also have vendors where we have– under contract now to provide some surge capacity if needed.

 

Sen Rice: Okay, thank you. Thank you, Mr. Chair.

 

Rep Wardlaw: Representative Speaks, I alerted audit that you had an audit question, so they’re ready to go to the table if need be, but I’ll let you ask the department first.

 

Rep Speaks: Thank you, Mr. Chair. Back to this audit. There are some things that really bothers me. There was $35,423. This could not be traced in a deposit. Can you tell me what happened to this?

 

White (DHS): And Representative Speaks, can you tell me which audit finding number you’re looking at?

 

Rep Speaks: It’s on finding two. It was on the very first page.

 

White (DHS): Okay. If I can, let me have Brett Hays, who’s our Office of Security and Compliance and who works with these audit findings– he can give you a summary of what happened there and what we’ve done to address it.

 

Rep Speaks: Okay. I have a couple of questions.

 

Hays (DHS): Brett Hays, Deputy Chief Counsel for Department of Human Services. So the audit finding that you’re referencing was related to one check in the amount of $29 that I have three checks receipted for the year totaling $35,423 that cannot be traced to deposit. It was my understanding that it was one check that they could not trace, and that was a refund that we had received, I believe, from Office Depot that just couldn’t be traced from when we cash receipted it to when we deposited it into the actual account.

 

White (DHS): So in other words, so for [inaudible], the $38,000 figure– the $35,000 figure for debit. If my memory is correct and I’m reading this correctly, that’s the total amount of the checks they looked at. That’s not the amount of checks they found a problem with. But they looked at checks totaling that amount, and then they identified those specific checks that could not be traced.

 

Rep Speaks: So we don’t know what happened to them.

 

Hays (DHS): It was just that one check.

 

White (DHS): Right. So that one check for $29, it was received, but then I think, essentially, lost is the best way to put it. But it was a $29 check from Office Depot for a refund.

 

Rep Speaks: So what you’re telling me then, out of that $35,423, there was only one check that wasn’t deposited?

 

Hays (DHS): Yes.

 

Rep Speaks: Okay. The other thing that I’m asking about– it looks like on $69,000, it’s the not getting them receipted in and put in the bank is what this is talking about. $69,619. 83 days before it was deposited. How come?

 

White (DHS): Yes, ma’am. This is a case where the staff received the check, and they just did not turn it over to finance staff timely. Director Smith can add some additional detail to that.

 

Smith (DHS): And Representative Speaks– I’m sorry. We’re adjusting up here. So the reality pertaining to this audit finding is that this respective division does not typically receive funding in this form, and so that staff didn’t have a procedure for how they were going about depositing checks. When we realized this issue, when we received the audit finding, they now have a very set process and checks don’t sit around. What happened is that they were mailed to the division and they, in essence, sat for a period of time before being deposited.

 

Rep Speaks: So they just didn’t ask questions.

 

Smith (DHS): But we have corrected that process, and that will not happen again.

 

Rep Speaks: Thank you. Thank you, Mr. Chair.

 

Rep Wardlaw: Thank you. And you don’t need to talk to audit, so you’re happy?

 

Rep Speaks: I haven’t read through all of it. I’m sorry. So.

 

Rep Wardlaw: Okay. Just let us know.

 

Rep Speaks: Okay.

 

Rep Wardlaw: So with that, we’ll move on to item– I need a motion. I got a motion. Do I have a second? All those in favor say aye.

 

Audience: Aye.

 

Rep Wardlaw: All opposed?

 

Rep Wardlaw: Ayes have it. So with that, we’ll move on to item 7. Ms. Walls, you are recognized.

 

BLR Staff: Thank you, Mr. Chair. The next division is the Division of Developmental Disability Services, and their department appropriation summary is on page 114 in your manual. They have authorized appropriations of approximately $195.8 million with 2,586 positions and nine appropriations. And they’re requesting approximately $212 million in fiscal year 2024 and nearly $214 million in fiscal year 2025, with the following changes. On line eight, which says Division of Developmental Disability Services – it’s pretty close to the bottom – that’s their operations appropriation and their increases in salary and matching associated with changes made in the interim, including reclassifications of 20 positions and a title change. The executive recommendation provides for the division’s requests with the following exceptions. In the operations appropriation on line eight, the salary and matching associated with the reclassifications and title changes are not recommended. And on line four, which is about a third of the way down, it says Autism Treatment Coordination. The executive is recommending that this be discontinued. The funding associated with this appropriation is transferred to the operations appropriation to be used to match federal funds and is expensed there. And the executive recommends that the appropriation be discontinued and that the associated funding be permanently transferred to the operations appropriation. And this concludes my presentation for this division.

 

Sen Rice: Representative Cavenaugh, you’re recognized.

 

Rep Cavenaugh: Thank you, Mr. Chair. Well, you answered my question on 122, but on 124, with the greyhound racing going away, what will happen with that fund balance once that is gone?

 

Stayley (DHS): Yeah. So those funds will be going away. We are working to see if there’s other funds that can be identified to help offset that purpose. But otherwise, since those funds are no longer there, that will no longer be part of our budget.

 

Rep Cavenaugh: But if there’s a fund balance because you’re not spending near what you’re getting in, it looks like, what happens to that fund balance? Where does it go to?

 

White (DHS): We’ll have the division director Melissa Weatherton come up to answer that for us.

 

Rep Cavenaugh: Okay. Thank you.

 

Weatherton (DDS): Melissa Weatherton, Director for Developmental Disabilities, and I have my deputy with me.

 

Tarpley (DDS): Tommy Tarpley, Deputy Director, DDS.  So the remaining fund balance, as long as the appropriation is there, would be spent in accordance with the appropriation for what it’s been spent for in the past. There would just not be additional funds from the dog track coming in to replenish like there was previously.

 

Rep Cavenaugh: Okay. Is there restrictions on how it can be used?

 

Tarpley (DDS): The restrictions that are in the appropriations bill. I don’t have the exact language in front of me.

 

Rep Cavenaugh: I’m sure you’ll get that on that report. Page 130. I’m going to talk about your regular salaries. Looking based upon your actual spend in 2022, you’re asking for an increase of $19.5 million.

 

White (DHS): So part of the issue there– and of course, I’ll let Ms. Weatherton and Mr. Tarpley add to this as needed. Part of the issues there is during the pandemic, like other healthcare providers, we struggled to hire staff, and so we saw our salary line– our actual expenditures drop. The problem is that we have to have staff in our human development centers to care for those clients. So when we can’t hire them, we have to look to other sources, whether it’s overtime for existing employees or contract labor, which is more expensive. And so we had to heavily rely on contract nurses and contract workers coming into the HDCs during that year. So that’s why there’s such a large difference, is that we’ve had more success since then getting more employees so we can shift more of that spend from the contract spend to salary. But that’s something we hope to see more of in the next year, is get more of that to the employee side because that’s cheaper for the state in the long run.

 

Rep Cavenaugh: Okay. So you’re going to actually increase your salaries almost $20 million for 178 more employees? That’s $109,000 each.

 

White (DHS): I’ll let Ms. Weatherton add to that.

 

Weatherton (DDS): Sorry, this is a little awkward. Representative Cavenaugh, so I don’t know if you were here when I talked about this at a committee. So back in 2020, we changed all the grades of the staff at the HDCs to raise them all to an 03 so that we could put them in CNA positions and increase their salary by, it was around, I guess, $6, $7,000 dollars annually and set up those CNA schools. And then we reclassified all of the supervisors, and we’ve switched out doctors for– we traded those in and brought in APRNs and traded in LPNs for RN positions too because we have a better chance of hiring RN positions. But as Secretary White said, we’re still heavily relying on these temp agency contracts, specifically for nursing, and we’ve hired 154 CNAs in the past year, which is really exciting. But you are correct. Our salaries for those employees of the HDCs has increased by $21 million annually for all of the things we’ve put in place since 2020. And so you are seeing that correctly, unfortunately. What we’ve had to do to retain staff has increased it by $21 million a year.

 

Rep Cavenaugh: Okay. And when you were talking about that you’re trying to take some of these out of, I guess, third-party payers and move them up there, I don’t see a reduction in any of your other lines. So really this is just an increase. You still have those other lines at the same appropriation level.

 

White (DHS): It is. But the problem for us is that we’ve got to keep that capacity available to respond to conditions as they change so that when we need contract labor, we can pull it in, or if we need overtime, we can do that as well. And it changes as economic conditions change, as the situation, the healthcare labor force changes. And so we need that flexibility to be able to switch because at the end of the day, whether it’s a state employee, a contract employee, or whatever, we’ve got to have a certain number of people in those residences day in, day out, taking care of those individuals.

 

Rep Cavenaugh: All right. Thank you.

 

Rep Dotson: Representative Wooten.

 

Rep Wooten: Thank you, Mr. Chairman. On page 114, you have $144 million roughly for disability services and 2,357 employees. That’s an average of $61,000. And then over in agency request, you have $187 million for 2,535 positions, and that’s $74,000. So are you increasing the pay from 61 to 74?

 

White (DHS): Well, as Ms. Weatherton said, we have worked over the last year or so to increase the pay for those workers in order to get workers in the door and to keep them at the facilities. We don’t have any plans, I believe, for additional increases beyond what we’ve already done. This is just to reflect what’s already been done to try and recruit and retain those employees.

 

Rep Wooten: The $25 million, roughly.

 

White (DHS): Yes, sir.

 

Weatherton (DDS): I will add, Representative Wooten, I think it’s fair to say our average staff member is a certified nursing assistant. That’s the majority of the employees that we have at DDS, and we brought them from $22,000 a year to $28, $27 thousand dollars a year. So that’s our average pay we pay employees.

 

Rep Wooten: All right. Under budget, you budgeted 2,095, you’re authorized 2,586, but you had 2,357.

 

Tarpley (DDS): So the $144 million, that’s the entire operating budget. So not just salaries, that’s operating expenses, of which, if you go back to the other page, I think is 27 million is 02 normal operating. That has nothing to do with salaries. So that’s not just salaries, that’s all of the divisions operating expenses there.

 

Rep Wooten: Okay. Well, what I’m asking is, you budgeted 2,095. You had 2,357– okay. You authorized 170. Okay. The next question I’ve got is on page 122. Under Autism Treatment Coordination, why do we not have any expenditures out of that account?

 

Weatherton (DDS): So, Representative, that’s the fund that Miss Walls was referring to. So it’s been confusing to explain to you guys when I get that question year after year because as soon as we get it, we transfer it. So that is the line that Ms. Walls was referring to that we’re asking that it be put into the right account from the beginning, because it always shows a zero on this page and no one understands why. And that’s because we transfer it immediately.

 

Rep Wooten: Well, where does it come from? The $273,000? I mean, what–

 

Tarpley (DDS): It pays for the contract to administer the autism waiver.

 

White (DHS): And it comes from state general revenue?

 

Tarpley (DDS): Yes.

 

Rep Wooten: State general revenue?

 

White (DHS): Yes, sir.

 

Rep Wooten: And what does it pay for?

 

Weatherton (DDS): We have several waiver programs, but we have a autism waiver specifically for very young children, and it’s administered by the University of Arkansas at Fayetteville. So we pay them to license Behavior Applied Analysis; these BCBAs that do the ABA therapy for kids with autism under this program.

 

Rep Wooten: Is that through the university or just through UAMS?

 

Weatherton (DDS): It’s through the University of Arkansas at Fayetteville. It’s the company that’s called Partners for Inclusive Communities.

 

Rep Wooten: Well, what is the dentist center at Arkansas Children’s Hospital? Is that tied in with this program?

 

Weatherton (DDS): No, sir, it’s not. It’s completely separate. That program is an evaluation and testing program that we refer a lot of parents and clients to that’s connected with UAMS and Children’s Hospital.

 

Rep Wooten: Okay. Thank you, Mr. Chairman. Thank you.

 

Rep Dotson: Thank you, Representative. Senator Irvin, you’re recognized.

 

Sen Irvin: Thank you. Just back to staffing. You still hire or retain physicians, don’t you?

 

Weatherton (DDS): We’re actively hiring all the time those positions.

 

Sen Irvin: But you have physicians as well? Because I heard you say you were replacing them. So I just wanted to make sure you still have physicians caring for these populations as well.

 

Weatherton (DDS): Oh, yes. I probably just didn’t word that correctly. We replaced them, but we changed them out. We didn’t eliminate any positions at the centers. We just changed the grades and tried to make it more appealing for people to come there and build a better career ladder. But we’re actively recruiting, and we’re doing really well on certified nursing assistants. We’ve seen a big uptick since we’ve been doing all these different efforts to increase pay in the ladder, but we’re still just really struggling right now with nurses.

 

Sen Irvin: Okay. How many doctors do you have on your staff? Do you know?

 

Weatherton (DDS): We had a hard time being competitive with doctors because of the pay. So we have a part-time physician, but we are utilizing APRNs at the HDCs right now to have APRNs on site.

 

Sen Irvin: Do you have, I mean, outside agreements with other physicians on a contract basis or anything like that in case it gets to different specialty needs and things like that?

 

Weatherton (DDS): We do. We have a contract in place with UAMS where they have several doctors on staff that not only can assist us with the HDC, but they can assist us at non-HDC for our community programs. They can be called in to help us.

 

Sen Irvin: Okay. All right. Thank you.

 

Rep Dotson: Thank you, Senator. Representative Wooten, back to you.

 

Rep Wooten: On the nursing situation, are you all partnering with any nursing school to help direct nurses to you all, or do they have a work-study program with y’all, or?

 

Weatherton (DDS): In addition to starting our certified nursing assistant program, I will say that our DHS human resource office runs down every avenue that gets sent to us, so they do an excellent job. We actually last week came over to request turning in some LPN, some licensed practical nurses, because it’s easier for us actually to hire registered nurses than it is LPNs right now. So if we get that finally approved, then I think that will help us. Registered nurses were very competitive with the pay at the state level, and they’re very efficient. And with COVID, we’ve seen that higher qualification be really helpful to us at the human development centers.

 

Rep Wooten: Thank you. Thank you, Mr. Chairman.

 

Stayley (DHS): And just to add to what Ms. Weatherton said. So in addition to operating, we actually started operating our own CNA school at the facilities. So that’s part of our outreach and recruitment effort in terms of being able to actually train nurses on-site. But then, as she also said, we partner like, for example, with Pulaski Technical College here in Little Rock and other places at the departmental level to try to recruit and then get nurses both either to come to our schools or we also offer at times assistance to be able to help them go back to school while also working at our facilities. So we’re always looking for other ideas, but those are just some of the things that we’re currently doing.

 

Rep Wooten: All right. Thank you. Thank you, Mr. Chairman.

 

Rep Dotson: Thank you. Seeing no further questions. Do I have a motion? Motion executive rec. Second? All in favor, aye.

 

Audience: Aye.

 

Rep Dotson: Any opposed? Motion passes. Moving on to item eight. Ms. Walls, you’re recognized.

 

BLR Staff: Thank you, Mr. Chair. Item eight is the Division of Medical Services. Its department appropriation summary is on pages 135 and 136 in your manual. They have authorized appropriations of $9.7 billion with 103 positions and 14 appropriations. They’re requesting appropriations of $1.1 billion in fiscal year 2024 and– I’m sorry, not 1; $10.1 billion in fiscal year 2024 and $10.6 billion in fiscal year 2025. I’m only going to discuss significant changes. All of the significant changes are to the Medicaid appropriations and are being made to better align with the Medicaid biennium forecast. I’m going to keep you on this page, and I’m going to try to give you some directions to keep you with me, okay? On line four, it says 648, Medicaid EXP- Hospital and Medical services. This is the hospital medical services line item for the Medicaid Tobacco Settlement appropriation, and they’re requesting that this line– or this appropriation be decreased by $40 million in both fiscal years. On line nine, which is about halfway down in the appropriation summary, it says 897, Hospital and Medical Services. This is the line item for the Medicaid grants paying appropriation, and they’re requesting increases of $486 million in fiscal year 2024 and $884 million in fiscal year 2025.

 

BLR Staff: The next one is Prescription Drugs. It’s 897, and it’s right underneath that hospital medical line item. And they’re requesting a decrease of $70 million in both fiscal years. And the next one with changes is on line 11, which is right underneath the prescription drugs line item. It says 897, Private Nursing Home Care. This is for skilled nursing facilities, and they’re requesting increases of $115 million in fiscal year 2024 and $165 million in fiscal year 2025. On line 13, which is two up from the big bolded place where it says Not Requested for the Biennium, that is the infant infirmary appropriation, and they’re requesting a decrease of $16 million in both fiscal years. And then the last one is– the last line that they’re– or appropriation that they’re recommending is for a public nursing home care. It’s the last one, 898, on the very, very bottom, and they’re requesting a decrease of $40 million in both fiscal years. And the executive recommendation provides for all of the division’s requests throughout. And this concludes my presentation for this division.

 

Rep Dotson: Representative Wooten, you’re recognized.

 

Rep Wooten: Thank you, Mr. Chairman. My question’s on page 135. You have $71 million actual– or $72 million actual expenses in the Medicaid. Is this the account where you refund money or payments back to the hospitals?

 

White (DHS): No, Representative Wooten. This is for paying for Medicaid expenditures related to individuals who come to their eligibility through that tobacco expansion program we talked about earlier.

 

Rep Wooten: So why do we have $200 million and now we’re cutting it to $40 and we spend– or you budget it at $109, and now your request is for $160 million and you only spent $71? I guess I kind of– that’s what I’m trying to get to.

 

White (DHS): Right. And we are reducing so we can get closer to the actual amount. We’re removing some of that additional appropriation that really is more needed, other pieces of the program. At the end of the day, our expenditures are dependent on what the makeup of our population looks like. And so especially with the expected end of the public health emergency, we have some guesses about what the population will look like overall, but there is a lot of variability there. And so if we end up having more people in these categories that stay on compared to others, then we’ll need that additional appropriation.

 

Rep Wooten: So are these individuals you’re speaking of, are these the ones you’re doing the survey on now to see their eligibility relative to before and after the health emergency?

 

White (DHS): They are part of that group. Yes, sir.

 

Rep Wooten: Okay. All right. Thank you, Mr. Chairman.

 

Rep Dotson: Thank you. Representative Fite.

 

Rep C Fite: Thank you, Mr. Chair. My question is about the infant infirmary. I know the costs are not going down, so why is that reduced?

 

White (DHS): So let us turn to that page.

 

Rep C Fite: Sorry. That’s on page 169.

 

Stayley (DHS): Yeah. So this is a situation where, much like with the last line item, we’re asking to be able to better line the appropriation with regard to this particular funding line item based on the forecast as it relates to those individuals that are currently utilizing services.

 

White (DHS): And I would say those facilities, I believe they would receive funding from other appropriation lines as well. So it’s not just that line.

 

Rep C Fite: All right. Thank you.

 

Rep Dotson: Co-chairman Rice, you’re recognized.

 

Sen Rice: Thank you. In regards to the nursing home closures that we had in the past, is there any outstanding liabilities that we have, or is there anything on the horizon right now that’s concerning or is that pretty stable?

 

Stayley (DHS): So we’re always continuing to work with facilities both here within the state and then separately, the federal government also does their own monitoring. And so we have been working with those facilities both that we monitor as well as the federal government and with the associations. At this point, there’s not a particular facility that we’re concerned in terms of within the next few days or a few weeks. But we know it’s a very– we know there’s a big challenge out there with some of the workforce issues, so we do continue to monitor and work with those facilities.

 

Sen Rice: Thank you.

 

Rep Dotson: Just on your overall bottom line of this– I mean, obviously, you’re going up roughly half-a-billion-dollar increase in your total, but you already had close to half a billion dollars in cushion over your actual expenses, and that’s almost half a billion each year of the biennium. Can you not get a little bit closer to the actual spend, especially with your ability to request transfers four times a year between appropriations?

 

White (DHS): Well, two points. One, I think our biggest issue right now, again, is the public health emergency. The federal government says it will end. When that happens, we just don’t know. And as long as that’s going on– I mean, our enrollment is larger than normal because we’ve not been able to remove individuals from the roles. At this point, we’re about 20% over where we were when the pandemic started. And of course, that has raised expenditures as well. And so that’s going to be the key determining factor. It may be that if they go ahead and end it this spring, that we will see a lower expenditure level going into probably the first year of the biennium, especially the second year of the biennium. But not knowing that, that, well, leaves us some uncertainty, and we always try to be prepared for that. In terms of the transfers, in our other divisions, that resource reallocation authority does help us in meeting needs and filling gaps. It’s a lot more difficult here just because of the size of the dollars that we’re talking about.

 

Rep Dotson: So if that federal emergency is declared at an end, does that also change the reimbursement rate at that time?

 

White (DHS): It does. It does. Right now we’re getting an additional 6.2% on our traditional Medicaid population as well as an additional amount on our CHIP population. And once that PHE expires, that goes away.

 

Rep Dotson: And that will kick in that 6.2% on the extra 20% enrollees automatically? Or how many do you expect of those to fall off?

 

White (DHS): That’s a good question. We know there’s about– as of right now, there’s about 380,000 or so that we have tried to redetermine and have not been able to, and so we have extended their eligibility. Now, it may be that they’re no longer eligible. It’s also possible that they are eligible and just didn’t respond to us. And at this point, all we can do is guess at which of those two it is. But we are expecting– our conservative estimate is that we’ll lose, I would guess, maybe 15% of those. So in the end, I’m thinking you’ll see a drop of anywhere from 60 to 120,000. But again, that is a very rough estimate.

 

Rep Dotson: Yes, absolutely. Thank you. Seeing no further questions, I have a motion executive rec. I have a second. All in favor, aye.

 

Audience: Aye.

 

Rep Dotson: Any opposed? Motion carries. Takes us to item 9. Miss Walls, you are recognized.

 

BLR Staff: Thank you, Mr. Chair. The next is the Division of Provider Services and Quality Assurance, and their department appropriations summary is on page 174. They have authorized appropriations of $20.7 million with 211 positions and three appropriations, and they’re requesting appropriations of $21.4 million in fiscal year 2024 and $21.6 million in fiscal year 2025 and changes in two of their three appropriations. On lines one and two, there’s the Medicaid Tobacco Settlement Program appropriation for this division and the DHS admin paying account, which is their operations appropriation, and they’re requesting slight increases in salary and matching in both of those appropriations that are associated with position changes that were made at the interim. And the executive recommendation provides for this division’s request. And this concludes my presentation for this division.

 

Rep Dotson: All right. Seeing no questions, I have a motion. We have motion executive rec and a second. All in favor, aye?

 

Audience: Aye.

 

Rep Dotson: Any opposed? Motion carries. Item 10. Miss Walls, you’re recognized.

 

BLR Staff: Thank you, Mr. Chair. The final division is the Division of Youth Services and their department appropriation summary is on page 182. They have authorized appropriations of $70.6 million with 99 positions and five appropriations, and they’re requesting appropriations of $81 million in fiscal year 2024 and $81.9 million in fiscal year 2025 with changes in three of the appropriations. If you look in the middle of that top box, it says Federal Child and Youth Services Grants, and that’s on line three. There’s a $4 million increase in both years for federal funding associated with the expanded in-home services program. On the next line, for residential services – that’s on line four – there are increases of $5.8 million in fiscal year 2024 and $6.6 million in fiscal year 2025 for increases in pharmacy costs, anticipated increases in the residential services contract that will be rebid soon, and the opening of a 20-bed complex cases unit. And then finally, in their operations appropriation, which is on line five – this is Division of Youth Services – they’re requesting increases in salary and matching for changes made in the interim and potential wage increases. The executive recommendation provides for the division’s requests with the exception of the salary and matching associated with the potential wage increases, which are not recommended. And this concludes my presentation of the department.

 

Rep Dotson: Thank you. Co-Chair Rice, you’re recognized.

 

Sen Rice: On the facilities that youth are housed in– thankfully we’ve not had things in the news or things have settled down. Can you tell me something as far as what the population is now, what change there is in that– kind of an update on our cost with the inflation and kind of where we’re at on those?

 

White (DHS): Yes, sir. I’ll let Deputy Director Smith address that. One thing I do just want to put out there because I just want to make sure everybody understands this. The contract for those facilities, it was procured. It’s been about seven years now, so we’re reaching the end of that contract. We’re getting ready to re-procure that. And the rate we’re paying is the rate that was negotiated seven years ago. So we are expecting an increase when we re-procure that contract, and that’s why we had asked for some additional SGR funding for the division. I just want to put that out there just so everyone keeps that in mind with that one and I’ll turn it over to Director Smith.

 

Smith (DHS): Yeah. And I will just add, Senator Rice, you’ve been with us through a lot of times, especially up there in Mansfield, and we’ve done a lot of work in that area. So we are grateful for the fact that we haven’t seen the number of incidents and definitely not the number of children leaving the facility. What we have seen over the past couple of years is our census did go down considerably during the pandemic. We are seeing an increase now. So we are starting to see our numbers grow, but we are still at a number where we feel like we can still maintain. What our primary concern is is what Secretary White referenced, which is, it is time, again, for us to rebid those facilities. And our understanding, especially when we look at other states, is that the rates for housing children is going up across the country, and so we’re going to have to be able to accommodate that so that we can continue to have a provider that provides the level of care that we need for our kids.

 

Sen Rice: I appreciate the update. I look forward to visiting with you on that as it comes online. Thank you.

 

Smith (DHS): Yes, sir.

 

Rep Dotson: Seeing no other questions. Do I have a motion? Got a motion executive rec and a second. All in favor, aye.

 

Audience: Aye.

 

Rep Dotson: Any opposed? Motion carries. Thank you. That takes us to item 11, Secretary of State’s office. And, Ms. Smith, you are recognized to begin your presentation.

 

BLR Staff: Mr. Chairman, the Secretary of State’s office is going to be in a little small packet of papers that you have on your desk. It says Secretary of State. I’ll let you all find it.

 

Rep Dotson: It’s the last thing in your packet, members. Go ahead.

 

BLR Staff: Okay. I am presenting today the Secretary of State office. Again, it’s from that packet, begins on page 118. I’ll direct your attention to page 120. This shows the appropriations. There are 12 appropriations for this agency.These have change levels. They’re requesting about $39 million each year of the biennium. There will be no executive recommendation on these agencies. The first one with the change level is found on page 121. This is their operations appropriation. It’s funded from the State Central Services. They’re requesting about $22 million each year of the biennium. Its salary and match adjustments made in the current biennium being requested to continue into the next biennium. Then on page 122, this is HAVA, the Help America Vote Act, title two. It’s funded from federal funds. They’re requesting $4 million for each year of the biennium. They’re decreasing this to be more in line with the funding and expenditures that they’ve had in the past. The third one with a change is found on page 126. It’s the campaign filing and reporting system. It’s funded also from State Central Services. They’re requesting about $1.1 million for each year of the biennium. This is a new appropriation. It’ll be used for building the campaign contribution and expenditure filing system. And then the last one is the electronic filing system cash. It’s found on page 129. And the agency is asking to discontinue this appropriation. So those are the requests being made by the Secretary of State.

 

Rep Dotson: All right, Representative Cavenaugh, do you have a question for the agency? If we could have somebody from the Secretary of State’s office come up. Please state your names for the record.

 

Nowman (SOS): Thank you, Mr. Chair. Kurt Nowman, Secretary of State business office director.

 

Ewer (SOS): Jordan Ewer, Secretary of State assistant business office director.

 

Rep Dotson: Representative Cavenaugh, you’re recognized.

 

Rep Cavenaugh: Thank you so much. My first question is going to be on page 126, which is dealing with the campaign filing and reporting system. The new appropriation, you’re asking for $1,083,000, or something like that. The online reporting, the highest that we ever spent on that was $578,000 and some change. Why are we needing more for this than we did for that?

 

Nowman (SOS): Thank you for the question. This is an entirely new system that we have initiated partly at the request of the legislature. Senator Johnson, last session passed a bill that asked us to look at the system. For those of you who’ve used this system know it has quite a few kinks in it, and it’s nearing its end-of-life cycle. And like everything else, unfortunately, the cost to provide the same type in, hopefully, a better system has increased. The actual contract itself that was signed was for $997,000. The $1,083,000 includes the first year of maintenance. And that was the competitive bid that we selected through a formal process.

 

Rep Cavenaugh: Okay, and on page 127, which is Admin and Maintenance, you’ve got a large fund balance there of $1.2 million. Your spend in 2022 was only $8,000. First of all, what are your various administrative and maintenance, I guess, expenses? But what are we going to be able to do with that fund balance?

 

Nowman (SOS): This fund is in regard to the parking lot that we maintain on Wood Lane. And like most projects of this nature, when it comes to a major project like repaving or completely redoing it, it’s a very expensive task. So we try to build the fund balance as much as we can so that we’re able to award that contract in whole instead of trying to piecemeal it. That’s the reason for such a large balance in that fund. And that’s what we are authorized to spend money for.

 

Rep Cavenaugh: Okay, and on page 130, which is the grants for the voting system, you’re asking for an appropriation for $10 million. It shows in 2022 you spent $1.258 million, but your historic spend, your highest had been in 2020 for $9.1 million. How many machines have not been replaced?

 

Nowman (SOS): As of this point in time, all 75 counties have county equipment that was purchased at least in part or in whole, through the Secretary of State’s office. So all 75 counties have equipment. Like most equipment, some of this was bought in 2016. That was the initial funding. So what we want to do is build an account that is consistent throughout the years for replacements of that first-generation legacy equipment and also to be able to have funding that can be utilized for areas of high growth where new machinery, additional machinery is used. We’ve reduced it to $10 million. I believe it was $12 million last year.

 

Rep Cavenaugh: It’s staying consistent at $10 million.

 

Nowman (SOS): Okay, but that’s mainly to allow for the reception of any federal funding that we get for that particular equipment.

 

Rep Cavenaugh: Okay, and how much do you project you’ll have to spend for new equipment?

 

Nowman (SOS): That I do not know. What we’re doing is we’re waiting until after the election, and we’re going to try to figure out from the counties what their needs are and first utilize what we have remaining in HAVA funds, and also project what the annual maintenance agreement is for the counties that the state pays on their behalf, so that hopefully when the session starts, we’ll have a better feel for exactly what that ongoing costs are going to be from year-to-year moving forward.

 

Rep Cavenaugh: Okay, and on page 131, this is Arkansas Video Service Fund. You’ve not had any spending there since 2017, 2018. What are we doing with this?

 

Nowman (SOS): That is correct. This is a fee that’s collected on various companies that provide video services. There’s a small pool of those companies that are assessed this fee. It’s such a small fund at this point that during our administration, we’ve not utilized any of that money. What we’re hoping to do, like most things, is let it build to an amount that is going to be usable for a larger project, hopefully. Since it’s collected by BCS, we’re thinking maybe it could be utilized by them to enhance and augment what they need in systems and material.

 

Rep Cavenaugh: Okay, so it’s a fee that someone is paying you, but we’re not utilizing it, so we don’t want to give it back to those people that are actually paying it, since we’re not using it?

 

Nowman (SOS): I believe we’d be amenable to a suggestion if that’s legislatively– it’s such a pittance, really, for $25,000 that it’s still in that account because we really haven’t got a sufficient amount to use for anything of magnitude.

 

Rep Cavenaugh: Okay, and on page 132, this is the Statuary Hall Trust Fund. Have the actual statuaries been paid for? Is all that expense done?

 

Nowman (SOS): We are in progress right now– as most of you know, there are two statues, one is of Johnny Cash, the other is of Daisy Bates. And we’re at the point now with Johnny Cash where the actual clay full-size model has been submitted to the architect at the capital and approved. And the sculptor, Mr. Benjamin Victor, has sent that to his casting company so that the bronze statue can actually be paid. His contract is in four phases. He’s completed two phases of the contract. As soon as the statue is bronzed and sent to Washington and we receive the approval on that, he’ll get his third phase. The statue of Johnny Cash, it’s the full-size clay model, has been completed. The architectural design is being sent at this very moment to the architect at the capital. So as soon as we get them to approve, then Mr. Kevin Cressy will be able to send that to his casting. So right now we’ve spent about $375,000 of a projected $950,000 budget and both statues are imminently in the process of being cast themselves.

 

Rep Cavenaugh: Okay, so when do you expect that project to be done? In 2024 because you’re requesting it all the way up to 2025?

 

Nowman (SOS): It is. Given the nature of the unpredictability of having to deal with the Federal Congress and also any supplier chain things that may happen, COVID, we built in a little bit longer on the back end to bleed into the next fiscal year. We’re hopeful that we can get this done this fiscal year. Daisy Bates probably will be first in the spring. It’s either going to be late spring, early summer for the Johnny Cash statue, at the latest. So we did carry this over into next year out of the overabundance of caution.

 

Rep Cavenaugh: Okay, and if you don’t mind, if you can also give me a report on your fund balances? I’d like to know your fund balances, the source of those funds, and any restrictions that are on those funds. And if you could just send that to staff and they’ll get it to me.

 

Nowman (SOS): We’d be glad to do that.

 

Rep Cavenaugh: Okay, thank you so much.

 

Rep Dotson: Thank you, Representative. Representative Fortner, you are recognized.

 

Rep Fortner: Thank you, Mr. Chairman. My question is about the National Statuary Collection Trust as well. Are there any funds at this time to bring the other statues home and what is the plan for those statues?

 

Nowman (SOS): Yes, sir. Thank you for that question. The funding that we have received for the entire project has been either from donations that have been made by donors, individuals, and by an ANCRC grant from the Arkansas Historic Preservation Program. As part of the requirements of the statuary process, we are required to bring those statues back to the state of Arkansas. Therefore, we budgeted that amount into the entire project. At this point in time, we’ve reached out to several folks who might be interested in receiving those statues, and the latest discussion at this point is to have the cemetery in which both figures are buried– they’ve talked about receiving those statues and putting them on display there, but we are certainly open to suggestion.

 

Rep Fortner: Follow up. Are those statues state property or has someone funded them in the past and they own them?

 

Nowman (SOS): The way the process works now is when you create a new statue, you donate it to the federal government and it becomes their property and at the point of time when the new statues are delivered and the old ones are brought back, it reverts back to the state. So it becomes state property at that point in time.

 

Rep Fortner: Okay, thank you.

 

Rep Dotson: All right, Representative Wooten, you’re recognized.

 

Rep Wooten: Thank you, Mr. Chairman. My question is on page 120. You’ve reduced your budget, but you’re requesting roughly $15, $16 million more than you expended in actuals. Why? And then the CVS grants are $1.3 million and you got $10 million budgeted. Why? Why are you budgeting $23 million or $39 million when you’re only expending $24? And then that one item is about $8 and a half million dollar difference from $1.2 compared to $10 million.

 

Ewer (SOS): Thank you, Representative Wooten. In regards, specifically, to the CVS grant, we have left the appropriation larger in anticipation that we may receive some funds that are not necessarily HAVA related, that will need a housing system within our budget because it has been a pattern that we have received money to both pay for election equipment maintenance, and also pay for new election equipment, which is why we have left it higher at the realm that it has been. In the time that Secretary Thurston has been in office, we have reduced that appropriation from $12 million to $10 million. It is remaining the same as it was last biennium. I believe it was two, maybe three years ago in act 808, we received a significant portion of money from the state that was housed in this fund that helped us pay for a large portion of new election equipment throughout the state as well. And so, in anticipation that we may receive something similar, or have talks of something similar in this biennium, we wanted to leave that option open and be ready to provide that to the state should we receive some sort of funding.

 

Rep Wooten: That answers the CVS question but what about the $15 million, the $39.3 million versus expenditure of actual of $24? Why are we budgeting and tying up $15 million more than we’re spending? I can understand $2 or $3 million but–

 

Nowman (SOS): Just looking at our budget right now, I think if you add up the differences, close to $8 and a half, $9 million for that CVS grant, the National Statuary Hall is another $700,000 in appropriation that probably will not be used as we had talked earlier.

 

Rep Wooten: Well, that’s still not answering my question, I’m asking you, why are you budgeting $39.3 million when you only expended $24 million?

 

Ewer (SOS): I know I’ve already spoken to the CVS grant, so I’ll just reference it briefly. That represents about $8 and a half million of the difference in the $15 million that we’re talking about. In addition, we had about $1.5 million that was originally budgeted for the E 91 electronic filing system cash fund that was originally appropriated and intended to be used alongside the sealed competitive bidding process for the new CC&E system that has since been awarded. An actual determination of the cost of the funding would happen, and that has now changed to become the campaign filing and reporting system for the $1,083,697. That money was not expended in the previous biennium because the project was not awarded until just a few months ago. As of right now, we’ve spent about $130,000 and we are on, I believe, phase five of the project to build the new system with the vendor. So that additional million will be used hopefully by the end of this biennium. It will hopefully be used by the end of this fiscal year with anticipation that it might bleed for the first six months into next fiscal year. And in addition, due to delays and different experimentation with the system and demoing the system, there may be changes that have to happen. So we have requested the appropriation for the full biennium to ensure that we’re able to pay associated costs with that system. In addition, there is the admin and maintenance B 97 appropriation that we have only spent $8,000 in, as listed in the 2021, 2022 year that is appropriated for $375,000. That fund is almost entirely used for refunds associated to fees that are collected by our BCS division, including franchise fees, corporate filing fees, notaries, etc, that can sometimes be quite large, and therefore, having the appropriation available is necessary to get consumers timely refunds if it becomes necessary while filing with that system. And that brings us to about $10 and a half million. And then, as Mr. Nowman had suggested, the National Statuary Hall is about another $750,000. You were pointing to something?

 

Nowman (SOS): There’s also the increase in the HAVA, which takes into account another million dollars in funding that they provided to us. And then an increase in the salaries as part of the operations.

 

Rep Wooten: So in reality, then, you’re saying that you anticipate spending $15 million more next year? Is that what we’re saying?

 

Nowman (SOS): We are budgeting that should funding become available largely through the federal government, and then also with the–

 

Rep Wooten: So are you saying that you’re going to spend $8 and a half million in the CVS item?

 

Nowman (SOS): We do not know if we will or not. That’s going to be based on what the county’s needs are going to be and what the federal government is going to provide to us in grant funding. At this point, we do not know the answers to either of those questions. So we kept the appropriation pretty high for those potential expenditures.

 

Rep Wooten: Thank you. Thank you, Mr. Chairman.

 

Nowman (SOS): Thank you.

 

Rep Dotson: Thank you, Representative. There is no executive recommendation on this. Having no other questions, got a motion for agency rec? A second. Any discussion? All in favor, aye.

 

Audience: Aye.

 

Rep Dotson: Unopposed. Motion carries. Folks, that wraps up our budget hearings for 2022. Seeing no other business, we are adjourned.