Arkansas Legislative Council Peer Subcommittee
November 15, 2022
Jump to Section
- ATU enrollment decline
- Nursing shortage study
- Infrastructure grants: Chesterfield (part 1)
- College food pantry grants
- College enrollment loss and projections
- Prison funding: Wardlaw
- Fayetteville Veterans Home
- Infrastructure grants: Chesterfield (part 2)
- Sexual assault kit backlog
- Homeless shelter grants: Crawford
Anderson (BLR): Thank you, Mr. Chair. We’re in section B. These are the various temporary appropriation requests. First item. Thank you, members. It’s 8 a.m. If you don’t have a packet, please let us know. Our staff will get you one. We are in the first section. This is section B. These are the various temporary appropriation requests. The first item is a letter from the Court of Appeals. It’s for $375,000 in appropriation. This is to replace the court’s carpet and to paint walls. It’s supported by the State Central Services Fund. The next item is on page 2. This is the Department of Finance and Administration, the Revenue Division. It’s a request for $2 million in spending authority. It’s to cover costs associated with the Commercial Driver License program and to carry out other duties. It’s supported by license fees. Next item is a letter from the Division of State Parks at Heritage and Tourism. It’s for about $3.5 million in appropriation. It’s provided for design and construction efforts of their capital improvement program. According to the letter, the increasing collections from the conservation tax revenues will allow for repair, renovation, and new construction projects.
Anderson (BLR): Next item is a letter from Department of Public Safety. This is the State Crime Laboratory. It’s for $110,000 in appropriation. It’s to purchase equipment for laboratory analysis in the toxicology section. It’s supported by General Revenue Fund. Next item is on page 5. This is Department of Labor and Licensing. It’s for $85,000. It’s to provide for operating expenses of their shared services section. Page 6 is again Labor and Licensing. This is the HVAC licensing board. It’s for $130,000. The spending authority is to purchase three replacement vehicles. Page 7 is again the HVAC licensing board. It’s for $45,000 in appropriation. This is to maintain daily operations. The next two items are on the regular agenda. They’re in a separate packet, marked BVT Held. These are items that were held over from the previous meeting. DFA has requested we pass over these items today. Now, we’ll go to the supplemental agenda. That’s in a separate packet. And A1 in the supplemental agenda starts from page 3. On page 3 is a letter from the Department of Military. It’s for $1.25 million in appropriation. This is to match the federal cooperative funding agreement to maintain and update armories. Those are Camp Robinson buildings, Fort Chaffee buildings, and to add on to the Department of Military building. Mr. Chair, those are all the various temporary appropriation requests.
Sen Dismang: Members, I’m going to take these one at a time just to make sure that we don’t call people and rotate them through. So does anyone have a question on B1?
Sen Chesterfield: I have a question.
Sen Dismang: Okay. Senator Chesterfield, you’re recognized for a question period.
Sen Chesterfield: Thank you, Mr. Chair, for allowing my question, period. What did Mickey say we were passing over?
Sen Dismang: Items B8 and 9.
Sen Chesterfield: Items B8 and 9. Thank you so much.
Sen Dismang: Thank you. All right, members, any questions on B1, 2, 3, 4, 5, 6, 7? And then we have the A1 from the supplemental. Any questions on those items? All right, seeing no questions, what’s the will of the committee? We’ve got a motion to approve. We’ve got a second. All those in favor, signify by saying aye. All those opposed? Motion carries. C1.
Anderson (BLR): Thank you, Mr. Chair. We’re in Section C. These are the American Rescue Plan appropriation requests. The first 11 items, 1 through 11 are direct federal awards. The first one is C1 on page 1. This is Arkansas Tech University. It’s a request for a little over $2 million in appropriation to spend the ARP funds. This is to make emergency financial aid grants to students to cover COVID testing kits and cleaning supplies and expanding financial aid outreach, and also cover lost revenues. The next item is on page 5. And page 5 is a request from UAMS. It’s for $3.6 million. This is to allow the Institute of Digital Health & Innovation to review broadband applications from the Department of Commerce. This is for the Arkansas Rural Connect Program. It’s also to recommend awards and then monitor projects through completion.
Anderson (BLR): Next item is on page 22. On page 22 is C3. This is a request from University of Arkansas Community College at Hope-Texarkana. It’s for $379,000 in appropriation. This is to make emergency financial aid grants to students. Next item is on page 24. $1.1 million to capital outlay to replace appropriation in the correct line item for replacing HVAC systems. Next item is on page 35. Page 35 is C5. Northwest Arkansas Community College. It’s also a request to reallocate previously awarded appropriation. It’s to transfer $188,000 to personal services matching to reflect anticipated salaries and to separate out the fringe benefits that were not previously requested accurately. It’s also to transfer $455,000 to grants and aid. That’s to account for salary expenses and additional student emergency grants.
Anderson (BLR): Next item is page 37. This is C6 on page 37. It’s Arkansas Development Finance Authority. It’s for $26.9 million. It’s provided for the State Small Business Credit Initiative to recapitalize existing small business support programs or to create new ones. The next item is on page 40. Page 40 is C7. This is the Insurance department at Department of Commerce. It’s a request to reallocate previously awarded appropriation. This will transfer $10,000 from operating expenses to a promotional line item. It’s for an initiative to expand the public health workforce responding to the needs of people with disabilities and older adults. Next item is page 48. And page 48 is C8. This is Department of Commerce, Arkansas Rehabilitation Services. It’s $121,000 in appropriation. It’s to make an award to the Arkansas State Independent Living Council to hire a public health coordinator.
Anderson (BLR): Next item is on page 51. On page 51 is again Arkansas Rehabilitation Services. This time it’s for $80,000 in appropriation. It’s to provide assistive technology programs and expand the workforce that supports public health for people with disabilities, their families, support providers, and network staff and volunteers. The next item is on page 54. On page 54 is C10. This is DHS. It’s a request for $592,000 in appropriation. It’s to expand outreach and distribution efforts of USDA foods available to Emergency Food Assistance Program clients. Next item is on page 56. On page 56 is C11. Department of Commerce, Division of Workforce Services. This is for a little over a million dollars in appropriation. It’s to strengthen identity verification of the unemployment insurance, enhance fraud detection, improve data management, increase cybersecurity, and expand overpayment recovery efforts. Items 12 through 24 are held over from previous meetings. They are found in a separate packet that’s marked Held ARP Requests. I spoke with DFA and they request to pass over these items today. Mr. Chair, those are all the ARP requests.
Sen Dismang: All right, thank you. Members, we’ll just do this the same kind of work through. Is anyone here from Tech for C1? Just a question on C1. Good morning. If you could just recognize yourself for the committee.
Fisher (ATU): Good morning. Jami Fisher, associate vice president of admin and finance, Arkansas Tech.
Sen Dismang: Okay. All right, thank you. If you could just walk me through a little bit about your plans. And I was trying to quickly read through. This is about a million dollars for grants to kids. If you could walk me through the process of how those are going to be doled out or they’re going to be selected, and then also your lost revenue and your plans for that nearly a million dollars of lost revenue, and then what your enrollment actually looks like this year. I mean, what I’m concerned about is getting into a recurring– I understand this is a direct funding, but at the same time, you did apply, you’re accepting, and here we are. So if you could just walk me through what y’all plan on– how you plan on utilizing those funds.
Fisher (ATU): Sure. So we’re following the same procedures that we did with the original funds that we received for the lost revenue. It’s a supplement to the decline in enrollment we did see due to COVID. Excuse me. And the awards to students will also follow the same procedures that we used before. That’s outlined there in the submission. It has to do with the students of greatest need and their Pell recipients.
Sen Dismang: Okay. And so for roughly the million dollars on lost revenue, and so you’re using that on your current expenses, right, for revenue that was lost in the previous year, clearly.
Fisher (ATU): Yeah.
Sen Dismang: But is your enrollment enough that it’s sustainable at this point? I mean, what is the– I mean, I understand you can take it and utilize it, but we’re not profiting anything. It’s going to be ongoing that we’re not able to sustain moving forward.
Fisher (ATU): It’s a year-over-year lost revenue comparison. And so it’s just to supplement what we’ve lost. Yeah, it’s just to add to, since that was available to us and we did see the decline in enrollment. We made the decision to utilize it for those purposes.
Sen Dismang: Okay. What does your enrollment look like now, though, in comparison?
Fisher (ATU): We are down, I believe, about 6.5% year over year for the fall.
Sen Dismang: You’re still down?
Fisher (ATU): Yes.
Sen Dismang: Okay. All right, thank you. Members, do we have any other questions on C1? If not, thank you. C2, 3, 4, 5, 6, 7, 8, 9, 10, or 11. Is there anything on supplemental? All right. I’m not sure where we are. Representative Wardlaw, you’re recognized.
Rep Wardlaw: I think my question is for you, and it’s kind of a follow-up to your question to Tech. I don’t know who the right person to answer it is, but we’re looking at this enrollment issue, and I was talking to a college yesterday, and it looks like we’re going to be looking at declined enrollment going forward, and we’re using this money to fill in those gaps. What are we going to do in the next few years to come as this enrollment gap continues? And I don’t know if higher ed’s here or if somebody wants to answer that Friday, but I think the important issue is that we’re not going to have enough money to fill these gaps and to keep these buildings up to the par that we’re going to need to. So I’d like to know what our strategic plan going forward is on that.
Sen Dismang: I mean, I would agree. I mean, part of my concern is we’re talking about building buildings and creating new programs and all kinds of things, and we’ve got a decline in enrollment at various schools. And I don’t know how those two things mesh without us having to greatly increase at some point our GR spend for declining enrollment to keep those positions on. Anyway, but yeah, if there’s someone from higher ed, that maybe can kind of put a little thought into that and see what we can come up with. All right, members, any other questions on items C1 through 11? All right, we have a motion to pass items C1 through 11. I’ve got a motion. I’ve got a second. All those in favor, signify by saying aye. All those opposed? Motion carries. We are passing over items C12 through 24 at the request of DFA. And we’re going to move on to D1.
Anderson (BLR): Thank you, Mr. Chair. We’re in section D. These are the Infrastructure Investment and Job Act requests. The first one is for the Department of Public Safety, State Crime Lab. This is $335,000 in appropriation. It’s to complete comprehensive toxicology testing of motor vehicle crash samples in a timely manner to satisfy fatality analysis system reporting. The next request is B1 on the supplemental agenda. So if you go to your separate packet, the supplemental agenda, it will be B1. That’s on page 4. On page 4 is a request from the Department of Commerce, Arkansas Economic Development Commission. It’s for $843,000 in appropriation. This is to create a five-year statewide digital equity plan that will include three activities: community outreach and stakeholder engagement, data collection and analysis, and report development and distribution. A majority of the award will be a subgrant to Heartland Ford to support the plant with guidance from the State Broadband Office. Mr. Chair, those are all the infrastructure requests.
Sen Dismang: All right, thank you. Senator Chesterfield, you’re recognized for question.
Nursing program study
Sen Chesterfield: Yes, Mr. Chair. I’m looking at items 12 through 24. This has been on the agenda for the last three months. Do we ever intend to pass this or is this going to be punted into the next session?
Sen Dismang: The governor’s office and DFA have committed to developing a plan in relation to how we fund nursing programs, behavioral health, and a few other items. We are still waiting and have not received any additional information on wherever they are on creating those plans. And as soon as that is available, then this committee and legislative body can take a look at it and make a determination if they agree and we can move forward.
Sen Chesterfield: May I speak to someone from DFA, please?
Sen Dismang: Is there anybody here who can answer some general questions? If you could just recognize yourself for the committee, and then Senator Chesterfield, you’re welcome to move forward with the question.
Sen Chesterfield: Thank you.
Babbitt (DFA): Andy Babbitt, DFA.
Sen Chesterfield: Good morning.
Babbitt (DFA): Good morning.
Sen Chesterfield: We have held this for some time now and we have waited on something that is going to tell us about funding for Game and Fish, Arkansas Tech, Monticello, UA Pine Bluff, Philander Smith, Northwest, Women & Children First, Arkansas Rural Health, Black River, da, da, da, da, da, da. What is the problem?
Babbitt (DFA): Excuse me. We have engaged several other departments, Department of Ed being one, to help us formulate a plan that addresses the needs for nursing and allied health across the state. To that end, Department of Health has actually engaged the Arkansas Hospital Association to do some research. And so we’re in the phase of waiting for much of that research to come back so that we can solidify a plan and bring it to the legislature.
Sen Chesterfield: I think time one, the question was, how many nurses do we need? That was asked several months ago, and it would seem to me a census of the hospitals, the assisted living facilities, all these things could have taken place by now. So why is there foot-dragging on this? Because these people keep coming to this body and we keep telling them, “Oh, and by the way, you’re just on there, but you’re not going to be heard.”
Babbitt (DFA): I understand. We had discussions yesterday with both the Arkansas Hospital Association, Department of Education, and Health Department following up on all of this. And what we’re being told is that data and that research should be back sometime in early December. And so at that point, we can solidify this plan and bring it back to you. I don’t know that I’m answering your question directly. We’re working really–
Sen Chesterfield: Has the census been done by those entities? I mean, it would seem to me– because we went to UAMS for a program. They said they had about a 40% shortage of nurses. We talked with assisted living facilities. They said they have a substantial shortage of nurses and CNAs, just me going to people, finding out stuff. So why is it taking so long for you guys to find out stuff? You can’t tell me how many nurses you need at UAMS, how many do you need at Baptist, how many do you need at CHI St. Vincent, the other hospitals around the state. We couldn’t just ask them how many folks we needed and have that information?
Babbitt (DFA): My understanding is Department of Health engaged the Hospital Association to do all of that research, and it’s going to be a more comprehensive plan. It’s going to look at not only the need now but also the need, say, 10 years out. So that as we bring a plan to you, it will be to address the immediate needs, however, not expand the program, knowing that there’s declining enrollment in higher ed, that we over-expand the program and we end up in a situation far worse 10 years down the road. And so that plan is a little bit more in-depth than just an immediate need for the hospitals today or nursing homes today.
Sen Chesterfield: Thank you. And so the individuals on here really are never going to have this heard. Is that what you’re telling me?
Babbitt (DFA): That’s–
Sen Chesterfield: That’s about it, isn’t it?
Babbitt (DFA): I guess that would be up to how the plan lays out and those that may apply through that plan to expand nursing at that point.
Sen Chesterfield: Thank you. Thank you, Mr. Chair.
Sen Dismang: All right. Thank you. Representative Dotson, you’re recognized for question.
Rep Dotson: Thank you, Mr. Chair. I may be on the wrong item, but this was in the supplemental B1. Is that the right area that we’re talking about?
Sen Dismang: Yes, sir.
Broadband – NWA (Dotson)
Rep Dotson: I guess I have a question for broadband– or Economic Development Council Commission.
Sen Dismang: And while he has someone coming up for that, I mean, what I would like to understand is how this meshes with what we just did for UAMS on developing a broadband study or monitoring or whatever. I just want to make– that maybe where you’re going, too, but I want to make sure if there’s someone in the room that needs to answer that question, how you all are working together, that would be great. You’re recognized, Representative Dotson.
Rep Dotson: Thank you, Mr. Chair. Jim, looking at this, this has state digital equity plan. The last map I saw of awards for broadband– I know we’ve had a lot of emphasis on broadband and spent a lot of money over the last couple of years on trying to expand broadband through all of Arkansas, trying to make sure no areas are not hit. But the last map I saw, there was a significant amount of missing awards in my corner of the state. And I have a lot of constituents that still don’t have the availability that is in other areas of the state right now. So are we looking at specifically the Northwest Arkansas corner of the state as far as some of this digital equity availability and how these funds are spent going forward?
Hudson (Commerce): Good morning, Representative Dotson. Jim Hudson, chief of staff, Department of Commerce. Yes, sir, I know that probably all the members who might not have been included, whose districts might not have been included in this particular round that we’re going through right now probably have the same question. Let me just address that very quickly. This particular round, they were looking at funding through the Capital Projects Fund. It will be about $150 million. The need for the remainder of the state is probably more than $500 million. And so, again, I think, as we said before, there will be ample funding to cover 100% of the state. So for Northwest Arkansas, and I think, the River Valley– there are some questions about the River Valley being left out as well this particular round. All those will get addressed. This particular appropriation for the digital equity grant, it is the first installment for the IIJA funds, the Infrastructure Investment and Job Acts funds that will be coming through starting next year. This is strictly a planning grant. It is not an infrastructure grant. We will not use any of this money to put fiber in the ground. Instead, we have to do some studies that are mandated by the federal government in order for us to unlock the funding that will be coming through next year. So it’s just the first step in that process. But those funds will be more than adequate to address all the unserved areas.
Rep Dotson: Do you have an estimate on how much of that funding will be available to the state?
Hudson (Commerce): I have a guess, let me say that. The numbers vary anywhere between $750 million to over a billion dollars.
Rep Dotson: So in excess of the estimated $500 million that’s necessary?
Hudson (Commerce): Yes, sir.
Rep Dotson: And just to be clear, this study and this grant will include all areas of the state, some of them that haven’t received anything so far, but going forward just to make sure we’re including all areas of the state.
Hudson (Commerce): Yes, sir. And this study is less about studying where broadband exists and doesn’t exist and more about the impact to communities of interest in not having broadband. So it’s really more of the socioeconomic impact of that that lets us get some data, develop a plan. When we submit our plan to the federal government, they’ll include that in the disbursements of funding to Arkansas.
Rep Dotson: Thank you.
Sen Dismang: Senator Chesterfield, you’re recognized for a question.
Sen Chesterfield: Yes. Thank you, Mr. Chair. And thank you, Mr. Hudson, for delineating that some of this money is going to go to underserved communities. Is that what I heard you say?
Hudson (Commerce): Yes, ma’am.
Broadband: Communities of color
Sen Chesterfield: How much is already going to underserved communities?
Hudson (Commerce): Well, this is the first time we have done this particular study, so none have been disbursed before.
Sen Chesterfield: Well, you’ve done a lot of broadband?
Hudson (Commerce): Yes, ma’am.
Sen Chesterfield: Of that broadband monies that were distributed, how many went to underserved communities? What percentage?
Hudson (Commerce): I’d guess well in excess of 90%, if we define underserved communities as those who–
Sen Chesterfield: Who don’t have it, huh?
Hudson (Commerce): Who don’t have it at all. Yeah.
Sen Chesterfield: Well, I guess I’d like to ask staff a question too, if I may, Mr. Chair, because at the last Peer meeting, I asked how much of this money ARPA funds have gone to underserved communities or communities of color. So I think we need to differentiate between those two. How many have gone to communities of color, or do you know?
Hudson (Commerce): Ma’am, I don’t have that information for you today.
Sen Chesterfield: Could you get it for me? You can try.
Hudson (Commerce): Yes, ma’am, we can try.
Sen Chesterfield: Thank you so much. I appreciate it. Thank you, Mr. Chair. And I’m waiting on the report from staff. Thank you, Mr. Chair.
Sen Dismang: Senator Davis, you’re recognized for question.
Broadband: River Valley
Sen Davis: Thank you, Mr. Chair. Mr. Hudson, you mentioned the River Valley being overlooked a little bit in this new map process. Can you help just walk us through, because it’s my understanding that the map that we currently have is pretty incorrect on a lot of things. There’s a lot of green areas which would indicate that those areas are served or covered with broadband, but in fact are not. And so I think it was probably a lot of our understanding that the consultants that worked on this map would be going door to door and really talking with people all across the state to see if they actually were served. That was sort of the problem initially is the maps we’re getting from the federal government are showing census blocks. And so you’re seeing it’s saying people are covered that clearly are not, right. And so sort of the purpose for the consultants was that we would have a more accurate map than the federal government puts out. But it seems that there’s still a lot of inaccuracies and there was no challenge process, right. So there’s no way for us to go back yet and say, “Actually, this shows green, but it should be red or whatever because these people are not covered.” And so I’ve had some good conversations with the state broadband director about that. And so just for maybe everyone’s understanding, can you help walk us through what you guys see in the next six, eight months as far as being able to challenge the map? So giving communities like Representative Dotson’s, like myself and several others a chance to challenge what’s out there and then maybe apply for the next round?
Hudson (Commerce): Yes, ma’am. Happy to do that, Senator.
Sen Davis: Thank you.
Hudson (Commerce): So the maps that we’re using for the current round of funding are based on the Broadband Development Groups Master Plan that was submitted to this body back in April, I believe. That’s kind of the standard that we use for that. We did not change that. That’s the work we hired them for. That’s the work that you wanted them to do. And so we worked off that. And for this particular round, what we told them was, we believe, subject to your appropriation, $150 million of federal money coming in for broadband. So go identify for us projects that would totally $200 million, because we’re going to do 75/25 split between public and private money. And what we wanted to do was try to get the biggest bang for the biggest buck on this. So we wanted to be able to provide broadband to the greatest number of households at the lowest cost. And then kind of work that list, I think, of 100 and something project areas, and they identified 40 that would cover at about $150 million of state money. That’s how the list was developed. And that was purely an objective process that BDG went through to give us that data. So that gets us to today. Quite honestly, that BDG map, unless we were to do another round, which we do not anticipate doing in the near future using more ARPA money, we’re going to be pivoting to the Infrastructure Investment Jobs Act money in 2023. Under federal law, the maps that we will have to use for that work will be maps that are currently being developed by the Federal Communications Commission. That work is underway right now. We think that they will publish their first draft of the map sometime in the next 30 days, and that will be available for public comment. We’ll be looking at that. We’ll be making that available to communities as well for them to give their comments on. So it’s going to be very, very important for us to engage with local bodies as well, for them to be involved and to help us give feedback to the FCC so that we have the most accurate maps possible for Arkansas. Those maps will ultimately determine how much funding we get. So they’re very strategic in terms of making sure they’re accurate. So hopefully that answers your question. Once that work is done, then we believe that the money will start being turned loose by the Feds for broadband work under the IIJA statute next year.
Sen Davis: Yes. Thank you. Yeah. My hope is just that communities that were taken off this round saying that they didn’t fall within the top 40 projects, which I understand prioritizing, but I think a lot of us are off of the map because it says that we’re not underserved when in fact we are, just because there are inaccuracies with the map. And so I just wanted to have you sort of explain that we’ll have a new map and we will have a challenge process going forward to make sure that once we see it, we can have an opportunity to address those inaccuracies which we weren’t given a chance to do this last time, which I’m not trying to come down on you for that. I know there was a process with the consultants that we went through, and we approved that. But I just wanted to hear you say that and explain that to us, that we will have that opportunity to challenge next time and make sure that our areas that are actually underserved are indicated on the map that they are, in fact, underserved.
Hudson (Commerce): Yes, ma’am. And I did visit on this particular point with Director Howie, the State Broadband Office, and I know he met with you recently and stressed the importance that Secretary expects that we get local input on that FCC review to make sure that if we don’t see something, you see something, you let us know so we can pass that along. Because you all know what buildings are in your district. We don’t know what buildings are in your district other than what we have on the GIS map.
Sen Davis: Thank you.
Sen Dismang: And so just real quick, the way this is going to work or mesh with UAMS and what they’re doing– I mean, it looks like we spent a bunch of money on consulting. And I realize there’s a lot of money being spent on broadband, but we’re continuing to find new ways of, how do we want to implement. And so where are we with that? And how do you collaborate with them on information they may have already gathered or their consultants already gathered or however this works as a process? When I read it, it looks like we’re paying to do something that we’ve already paid to do once before in a way.
Hudson (Commerce): So yeah, just to clarify, UAMS is not involved in this particular appropriation. This is Heartland Forward that will ultimately be a sub awardee. But to your real question I think you’re asking is, are we doing something twice here? What we’re doing is we’re following what the Feds are requiring us to do in order to unlock the larger amount of money. And so they want us to produce a digital equity plan. I would say that BDG’s report touched on it, but they did not drill down on this issue of digital equity, which does include communities of color. But more than that as well, it also includes just the impact of rural Arkansas in general. And what are the workforce development issues? How do we increase workforce skills in terms of utilizing broadband? So it’ll touch on that as well. So it’s going into a little bit deeper dive. And again, it’s just satisfying requirement in order to get the several hundred million dollars that we want to get.
Sen Dismang: And just make sure I understand different buckets because I get confused all the time. We originally thought we were going to spend broadband money out of ARPA. Then there was this Capital Projects Fund that we needed to say how we were going to spend the money sooner than we were able to. So the Feds, I think, gave some indication they really liked that for broadband. And a lot of what you see, members, in 11 through 24 are projects that are actually committed to underneath the Capital Projects Fund but then ultimately are going to get funded out of ARPA. And I’m not going to get into the weeds on why. So how much money– so we have Capital Projects, we have the Infrastructure Funds. Are those one and the same? Yeah, that’s kind of what I was thinking. So how much money have we committed to already for broadband out of the Capital Projects, and then this new round of money is $150 million, or am I missing the–
Hudson (Commerce): You got it right. It’s $150 million from the Capital Projects Fund and we’re not asking for any ARPA money on top of that. Where it gets confusing here is that Capital Projects actually is a part of ARPA. It’s just a specific category within ARPA. And rather than asking for the state and local fiscal recovery funds on ARPA for another broadband round, we’re just asking for the $150 million from Capital Projects and that’s it. And we believe that that will finish us out under anything ARPA related, more or less.
Sen Dismang: And this is my question, too. So you have ARPA, which has Capital Projects as kind of a subcategory, and that’s the $150 million that, like I said, we’re supposed to do a bunch of these projects here, but we, kind of, for whatever reason, didn’t work out. And then we allocated it all to broadband. And then you also have– is there additional money through the infrastructure program itself that’s to fund broadband or does that make sense?
Hudson (Commerce): No, it does make sense. I think it’s what I was speaking with the Representative Dotson about earlier. That money’s not been released yet.
Sen Dismang: Right, okay. So there’s a whole other round of money that’s associated with broadband underneath the Infrastructure.
Hudson (Commerce): Big pile of money. It’s a big pile of money.
Sen Dismang: Hopefully, we don’t have to do another rework of how we’re going to spend those dollars and hire more consultants to work through that. Hopefully, we can maybe mesh the two studies we’ve done so far and be able to plow forward there, though I’m sure Feds will have something to say about requirements.
Hudson (Commerce): And that’s the issue, quite frankly, Senator, is that unlike both ARPA and CARES, the statute in terms of terms of IIJA is very particular in terms of process and components. And there are just certain things and certain reports we’re going to have to prepare in order to be able to get access to that money. Fortunately, the statute also funds it, as well, so they’ll give us mechanism for that.
Sen Dismang: All right, thank you. Representative Wardlaw, I think. I don’t know who’s in the–
Rep Wardlaw: So this infrastructure money that’s available–
Sen Dismang: It’s not available yet.
Rep Wardlaw: What?
Sen Dismang: My understanding is the only thing that’s available is the $150 million in capital projects out of ARPA and there’s going to be a whole other round of funding in infrastructure.
Rep Wardlaw: Let me change my term.
Sen Dismang: There we go.
Rep Wardlaw: That’s coming available. It’s also available for water, sewer as well, is that correct?
Hudson (Commerce): Yes, but the way the statute’s written, those are specific line items that fund those categories. So broadband is not in competition with water projects under IIJA. They have their own funding source, they have their own title in the bill.
Rep Wardlaw: Thank you. That’s the point I wanted to make.
Sen Dismang: All right, and then Senator Chesterfield, you’re recognized.
Infrastructure grants (part 1)
Sen Chesterfield: Thank you, Mr. Chair. Mr. Hudson, in dealing with those issues of infrastructure, as far as water projects, etc, etc, those communities that I serve have huge issues as far as sewer and all of that. Is that where they would get the money?
Hudson (Commerce): I believe there is sewer allocation in the Infrastructure Investment and Jobs Act under IIJA. I can’t speak to that personally.
Sen Chesterfield: Is there money available now through another funding source? Because we’ve got all of these pots of money, these huge pots of money. And so those people who are not as adept at filing for these grants, knowing the ins and outs of them, who is there to help them navigate this?
Hudson (Commerce): Well, I know there are projects that are– staff that are in Agriculture, Department of Ag, Energy and Environment. We provide grants at AEDC through CDBG as well. And then it’s an allowable use category under ARPA as well.
Sen Chesterfield: So we need to get with you, learn the alphabet soup of it, find out the various areas where they may be able to access money, and help them walk through this?
Sen Dismang: If I can jump in real quick, I think, we’ve already allocated out of ARPA, which it was originally supposed to be out of the capital projects portion, but out of just the regular ARPA money for water and sewer projects that’s sitting with the Department of Agriculture, I believe.
Sen Chesterfield: So it’s there. Has it already been expended? Because sometimes it seems to me that once we get it there, it’s gone like the next day when the grants come up.
Sen Dismang: I think it will go quickly, I do, because I think there is need. And one of the things that the department, again, maybe somebody’s here– we’ll go back to a plan. We would like to have some plans on how that money is supposed to be spent. I think we’re supposed to get a report on how that money is going to be spent, and maybe it’ll be easier to answer some of those questions when it’s ready. And then secondary to that will be a whole other round of money that will come out of the infrastructure funds for water and sewer projects, just like there will be a whole other round of money for broadband projects to come out of that. But the Feds haven’t released the dollars and so those aren’t available to be spent yet.
Sen Chesterfield: How do we assure people will have an equal opportunity to access the fund? One of the things that you said about the C12 through 24 is, did everybody know about it? That was one of the questions you raised. I want to make sure that when we talk about the infrastructure money and this water and sewer that communities like Hensley and Wrightsville and all of these little areas that I represent would have an opportunity at that money.
Sen Dismang: Well, I think it should also be based on need, true need. Not wants, but needs. And we have communities that have brown water. And I would really like for that to be a– that’s a need that needs to be corrected.
Sen Chesterfield: And that’s one the reasons I mentioned those communities because that is a part of what’s going on in there.
Sen Dismang: And that will be the Department of Agriculture. At this point– I don’t know if anybody’s here or not, where they are, and I may be even saying that wrong, but we did pass that out. Do you all remember how much money it was? Almost $300 million that was set aside, but again, that’s probably–
Sen Chesterfield: Is it still there or has it been spent?
Sen Dismang: My understanding is it still be there.
Sen Chesterfield: Okay, so I need to contact the Department of Ag. And what are the other departments that we need to contact?
Sen Dismang: At this point, I think that’s the only grant program. Natural Resources, I’m assuming, is more specifically who it is.
Sen Chesterfield: So that those individuals that I represent, who usually don’t have a voice, I can get them to the right place and get the right information so that they are competitive as far as these grants are concerned because of the need.
Sen Dismang: As far as I know.
Sen Chesterfield: As far as you know.
Sen Dismang: Yeah.
Sen Chesterfield: Okay. Thank you.
Sen Dismang: All right, members, we have any other questions on B2– Is that right– B1. All right, seeing no other questions, I have completely lost place of where I am. All right, thank you, sir. Members, do we have any questions on D1 or B1 supplemental? All right, seeing none, what’s the will of the committee? We’ve got a motion to approve. We’ve got a second. All those in favor, signify by saying aye. All those opposed? Motion carries. Moving on to E1.
Anderson (BLR): Thank you, Mr. Chair. We’re in section E. These are the rainy day fund release requests. There’s only one item. This is a letter from the governor to transfer $100,000 from the rainy day fund to the Division of Higher Education. The funds will be used to make grants to institutions to support on-campus food pantries.
Sen Dismang: Members, any questions on E1? I guess I would just have one on department. Are these going to be available to private and public schools or just public schools? Do you want to hit your mic or whoever wants to answer that question? How do we plan on expending the $100,000?
College food pantry grants
Fuller (Higher Ed): Yes, sir. Nick Fuller, Assistant Director for the Division of Higher Education. We are planning to make this open to all public and private institutions, like a $5,000 grant opportunity. Send out the request, any of them that want to apply, send that they want to accept the funds. There will be a requirement that they have to have a wish list, like an Amazon wish list to stock their food pantry.
Sen Dismang: Hopefully, we can use Walmart.
Fuller (Higher Ed): One of those items.
Sen Dismang: Or we can send our money out of state.
Fuller (Higher Ed): Yes, sir.
Sen Dismang: Okay. All right, so that’s $5,000 per institution to make a request to kickstart a pantry?
Fuller (Higher Ed): Yes, or to replenish one they already have. Either to start one or to replenish one already on their campus.
Sen Dismang: Okay. All right. Thank you.
College enrollment loss
Fuller (Higher Ed): Sir. If you want, while I’m here, I can answer your question on the enrollment. I’m sorry I was not here earlier for that question.
Sen Dismang: Absolutely.
Fuller (Higher Ed): But the institutions moving forward have already made adjustments to their budgets and plans for the lowered enrollment going forward. The request to backfill lost revenues was for the unexpected loss that happened during the COVID years that wasn’t planned for. They had to dip into the reserves that were planned for other items. So they’re refilling those reserves, but have adjusted their budgets moving forward to account for those lower enrollment numbers.
Sen Dismang: When you say adjusting their budget, I can’t remember what Tech’s percentage of decline was.
Fuller (Higher Ed): Six and a half percent.
Sen Dismang: Six and a half. And so how does that impact the appropriations and everything? I mean, if we’re servicing less students in higher ed, what does that look like long term? Do we anticipate a dramatic shift in what’s happening? Because what I’m seeing right now in employment is there’s not enough workers. There’s not enough employees to fill the need right now. So people aren’t going through higher ed or they’re doing something abbreviated to be able to go ahead and enter in the workforce. So what does that look like for our funding request? If there’s a 6% decrease, for instance, at Tech– is that pretty much across the board or?
Fuller (Higher Ed): Yes, sir.
Sen Dismang: About 6%?
Fuller (Higher Ed): That decrease. Yes, sir.
Sen Dismang: So what should we be looking at as far as funding there?
Fuller (Higher Ed): With the state funding, it’s still tied to the productivity. So they’re not coming and asking for additional requests for state funding based off of these enrollment changes. So all of that funding, what would happen if they continue to see those productivity increases that could help offset tuition increases to the students on the other side. The school wouldn’t have to increase that to match other costs because the state funds aren’t coming in. As long as we continue with the productivity model, keep it in place as it is, it should help offset the affordability to the students on not requiring additional tuition increases.
Sen Dismang: Okay, thank you. Representative Wardlaw, you’re recognized.
Rep Wardlaw: Thank you, Mr. Chair. Is there a site in the future where enrollment comes back or actually starts climbing again, or do you guys have that foresight? There was an article in the paper– I believe it was yesterday or the day before– that was talking about the declining enrollment and the future of declining enrollment. So what do you guys see from that?
Fuller (Higher Ed): I don’t believe we currently project anything. We continue to see a decline overall just in student population, much less the students going into college. So we don’t see a huge increase in the future right now. So we continue to monitor it, but currently, we do not see a projected increase coming forward.
Rep Wardlaw: Thank you.
Sen Dismang: And again, just to go back to the trend lines of where we are, 6% loss kind of across the board in general, and what does that look like for future years? Do we see that to continue to decrease? Do we think it’s going to level off?
Fuller (Higher Ed): It should level off. A lot of the enrollment, especially on the two-year side, depends on what the economy– a lot of people think if the economy continues to go down, more people will seek those two-year certifications. So we may see an increase back there going forward. We don’t expect such a drastic drop off of double digits.
Sen Dismang: And I think part of it is higher ed’s going to have to meet the demand that’s there right now by employers and just need in general. And I’m not sure that we’re set up to do that yet, but I think it will happen.
Fuller (Higher Ed): Yes, sir.
Sen Dismang: Thank you. All right, any other questions on E1? All right. Seeing no questions, I’ve got a motion to approve. I’ve got a second. Any discussion? Seeing none, all those in favor, signify by saying aye. All those opposed? Motion carries. Section F.
Anderson (BLR): Thank you, Mr. Chair. We’re in Section F. These are the Restricted Reserve Fund Transfer requests. The first four requests are to make transfers from the majority vote set aside account within the restricted reserve fund. That account has a balance of a little over $2 million in the report. That’s at the end of the agenda. The first item is F1. This is SAU Tech. It’s a $482,000 transfer. It’s to support construction of a one story burn building located at the Arkansas Fire Training Academy. Next item F2. This is on page two. This is a letter from Division of Higher Education. It’s for Northwest Technical Institute. It’s $157,000 transfer is to help offset the fiscal year 2021 category defunding that was not reinstated in the 2022 Revenue Stabilization Amendment. Next item is F3. This is the Division of Higher Education again. This is for Arkansas Community College colleges. It’s a $250,000 transfer. This is to make a grant to a nonprofit that the nonprofit is Arkansas Community Colleges. The funds will be used for training, expanding nontraditional means of skills development, consultation with industries to develop strategies for employer needs, and for infrastructure to award college credit with nontraditional means. Cash appropriation request later in the agenda will provide the spending authority for these funds. Next item is F4. This is for the Department of Public Safety State Crime Lab. It’s a $600,000 transfer. This is to process sexual assault kits and lower the current DNA backlog. A cash appropriation for this request is also later in the agenda, and it’s to provide the spending authority. The next three items, F5 through 7, those are transfer requests from the majority vote various improvements in projects set aside. That account balance has $121 million balance, and that’s also in the report at the end of the agenda. So the first one, F5, is for the Department of Education School for the Blind. This is a $15 million transfer. It’s to cover costs for new residence buildings, instructional spaces, demolition and decommissioning buildings, fencing, gates, and other improvement projects. F6 is for the School for the Deaf. It’s also $15 million transfer. This mirrors the previous request for the school for the blind, and it’s to cover the cost of improving projects. F7 is the Department of Military Arkansas National Guard Foundation. It’s a $5 million transfer. This is to support the National Guard Foundation to retire some bond issues.
Anderson (BLR): And the next two items, F8 and F9, are items that are held from a previous meeting. They are found in a separate packet that’s marked Held Restricted Reserve Requests. Again, I spoke with DFA. The request is to pass over these items today. There is one more request for a transfer. It’s on the supplemental agenda. It’s C1. It can be found on page nine. On page 10 is a request from the Department of Veterans Affairs. This is a $1.4 million transfer from the EBD or Contingency 3/5 set aside account. That’s also within that Restricted Reserve fund. It’s through the Department of Veteran Affairs. The funds will be used to wind down the state operations of Arkansas State Veterans Home at Fayetteville and to provide one-time outsource operation startup costs. The letter says costs have outrun revenue by $150,000 a month year to date. It notes the contract nursing costs have doubled and the employee vacancy rate of 50%, with an annual turnover of more than 100%. A working group led to the decision to have operations outsourced to a contractor. A cash appropriation request is later in the supplemental agenda to provide the spending authority to use these restricted reserve funds. Mr. Chair, those are all restricted reserve transfers.
Sen Dismang: All right. Thank you. Representative Wardlaw, you’re recognized for question.
Rep Wardlaw: Mr. Chair, I think these are for you. Under F, the majority set aside, wasn’t that the account the prison money was set in? Or maybe Robert Brech can come to the table and answer some of these.
Sen Dismang: I thought that was 3/4 or 3/5 but I may be wrong. If you could just recognize yourself for the committee.
Brech (DFA): Robert Brech, DFA. Could you repeat the question, please?
Rep Wardlaw: Under items under the restricted reserve– the items one through four, I guess one through seven, are all from the majority vote set aside account. Was that the account that we had the prison money sitting in? And if it wasn’t, what was the balance of that account and what would the balance be after these transfers?
Brech (DFA): The set aside, you do have some items out of the set aside. Let me get the majority vote set aside– that’s what the governor had in his– I think the last balance that I saw for that was around $2 million. I’m not sure what else has been obligated out of that fund. The majority vote, various improvements, and projects set asides where the prison money was, that was $150 million. After these things are taken out, you’re still going to have the $75 million for the prisons will still be there. There was $15 million that was unobligated that was also in that account. But this will take that balance down some. I don’t know the exact amount, but it did include the $75 million for the prison.
Rep Wardlaw: I thought it was $150 [million] for the prison. And then we had $15 unallocated in that account on top of that.
Brech (DFA): It was $150 million total. It was $75 million for the prison, $15 million for School for the Deaf, $15 million for School for the Blind. I think there was $5,000 for the National Guard. And then I believe the rest, $15 million was unobligated, but the total was $150 million, $75 million for the prison.
Rep Wardlaw: So these three requests were accounted for in the account?
Brech (DFA): Yes.
Rep Wardlaw: I remembered the National Guard, but I didn’t remember the blind and the deaf.
Brech (DFA): Yes, it was $15 million a piece for those.
Sen Dismang: Okay. And they’re coming out of the correct fund or the fund that we thought they would. And then above that is just the majority set of vote set aside, which I don’t know– I think there was money placed into that. I’m not sure that we knew at the time.
Rep Wardlaw: I think it’s healthy that we all understand that this was planned and this was good and coming out of the right account. Thank you, Mr. Chair.
Veterans Home, Fayetteville
Sen Dismang: Thank you. Members, any other questions? So on the veterans of– where is it? Which one? Page 9. Veterans affairs. The Veterans home in Fayetteville, the wind down. I mean, I don’t know who this is for, but I guess my request would be, we’re going to do what we need to do in the committee, but it sure would be nice to have this on something more in advance than just the supplemental agenda. So if you can just kind of walk me through what’s happening just so we know. Because, again, there’s not been enough awareness to even really have a conversation about what the need is and what’s going on there. So thank you. Just recognize yourself for the community. Just one time. And there it goes.
Watkins (ADVA): Karen Watkins, ADVA. Yes. We apologize for the lack of notice. The secretary engaged the Arkansas Veterans Commission about two years ago to study the challenges at the State Veterans Home in Fayetteville because it’s had some ongoing financial challenges, as I think you all are aware. And so this committee has been meeting all of this time monthly, and a decision was made to put a bid out through the Office of State Procurement that was posted in July, I believe. And we are still in negotiation with a potential vendor. There were two bidders. It was put out as a request for proposal for complete outsource turnkey operation of the facility. And because I’m still bound by confidentiality, since we’re still in bid discussions and I can’t provide a lot of detail in that regard. I can provide more detail regarding the findings and the decisions that led to the conclusion that a vendor with substantial expertise in skilled nursing home operations and in particular in state veterans home operation will be more likely to have the expertise to control finances and provide the high level of care that we’re looking for. Right now, the facility has about a 58% staff vacancy rate, so there’s only 37 state employees working at the facility. There’s an extreme lack of continuity of care and lack of continuity in the operations team to a large extent. In addition to relatively low census during COVID, most state veterans homes experienced substantial loss of census. And Fayetteville was not an outlier in that regard. They also suffered from loss of census. Last year, the average census was 64, which is about 70% occupancy rate. It dropped down to, I believe, 54, 55 during the pandemic, and currently the census is 65. The average year to date is about 69, but the census has dropped a little bit. We started off the year with a higher census and it’s been dropping. It’s just a very challenging operating environment. And the contract labor costs have increased by 100% versus the forecast for the year, and there’s just been a steady increase in contract labor costs. For example, if there is a case of COVID, we have two floors. I’m sure you all are aware that it’s two floors of the old Washington Regional Medical Center, now owned by UAMS. And if there’s a case of COVID on the floor, the nursing contractors that we use charge one and a half time rates. And it’s a substantial bump in cost because we pay employee benefits on every budgeted position rather than just staffed positions. We’re doubling costs in some sense. We’ve got 37 positions in the average EBD rate that we’re paying for each staffed position is about $1,300 per month on top of very high-contract labor rates. So lots of, a difficult operating environment and with just two state homes run by the state, not a lot of expertise to draw on, as opposed to a vendor who may operate a dozen or more skilled nursing facilities.
Sen Dismang: How is the other home doing?
Watkins (ADVA): It’s doing quite well. It’s an outlier. During COVID, it did not suffer from a drop in census. But the macro environment, in the Little Rock and Central Arkansas area is different. It’s a new facility. It’s paid in full. There’s no rent. We do pay utilities there, but utilities are cheaper than the rent that we pay in Fayetteville that includes utilities. The census last year was 92, so 95% full during the entire pandemic. And there’s a larger veterans population in Central Arkansas, and the census at North Little Rock is 80% service-connected disabled veterans for whom the reimbursement rate from the VA is the highest level. It’s full cost of care. In Fayetteville, the percentage of service-connected disabled veteran residents is substantially lower. So it’s an issue of, on the revenue side, lower census, lower daily rate, reimbursement rates from payer sources, and then on the expense side, higher expenses, higher turnover.
Sen Dismang: But we think that a private entity is going to be able to better manage and run the facility. I guess that’s the bottom line. And provide better service to the occupants.
Watkins (ADVA): Yes. Because if you think about it, the operating model for each of the two homes is very different. We’ve got the small home design in North Little Rock with eight cottages. In Fayetteville, we have two floors of a former hospital, very different operating model. So not a lot of ability to share knowledge between the two facilities because their operating models are so different. And these prospective vendors that bid on the contract have substantial experience across many states and many nursing homes. So it’s our expectation that they will have more resources to draw upon than we currently have.
Sen Dismang: Will this be the first time that private entity has ran one of our state nursing homes?
Watkins (ADVA): Yes.
Sen Dismang: Okay. And is it a practice in other states, often?
Watkins (ADVA): It is. Many states outsource the operation of their state veterans homes. Texas, Maryland, Alabama. There are others.
Sen Dismang: Okay. All right. And as far as Northwest Arkansas, colleagues, I’d like to visit about what you’ve seen, what’s happening there. It’s a little concerning, I would think. Does this get you all through the hump? What is this $1.4 million, it’s going to get you until you’re able to be taken over by a private entity?
Watkins (ADVA): Part of the money will be used to supplement the facility’s revenue this year while we prepare for the outsource. And part of the funding is being set aside for startup cost of the contract. For example, the bid stipulates that the contractor will take over IT. They will not be on the state network, so a circuit will have to be installed up there that they’ll own. It’s my understanding the lead time is about six months for that and there’s some cost involved for the IT systems that the vendor will have to implement. We’re anticipating using that money as a one-time upfront cost to a potential vendor.
Sen Dismang: I have a lot more questions, but I’m going to stop. Senator Chesterfield, you’re recognized.
Sen Chesterfield: Mr. Chair, it’s not about this. I just wanted to give you some information that I heard to verify it was correct and that’s when we were dealing with the Department of Ag. And I can come back.
Sen Dismang: No, I mean, I don’t have any other questions. If anyone else has any other questions. I appreciate your time this morning, and hopefully, this reconciles the issues that we’re having there. I mean, I think it’s very unfortunate. With that, members, any other questions?
Sen Chesterfield: Well, let me go ahead with the question that I had.
Sen Dismang: Yes, ma’am. On this or?
Sen Chesterfield: Oh, no.
Sen Dismang: I’m going to go ahead and take a vote and circle back if you want to.
Sen Chesterfield: Okay, circle back.
Sen Chesterfield: Yeah. All right. I’ll always be there, you’re good. All right, so let’s go to– where are we? All right, so F1 through 4, 5, 6, 7, and then C1. Is that correct? I need a motion to approve items F1 through 7 and supplemental item C1. Got a motion to approve. We’ve got a second. Any discussion? Seeing no discussion, all those in favor, signify by saying aye. All those opposed? Motion carries. Move on to Senator Chesterfield. You can hit your button.
Infrastructure grants (part 2)
Sen Chesterfield: Thank you. Mr. Chair. I just have a quick question. Someone told me that the Ag grants, you had to have them in by November, that they were to be distributed in December, and I just need to verify that because I was not aware of it.
Sen Dismang: I do not know the specifics. Do we have anybody here that can answer any questions from Natural Resources or Farm and Ag on that program for the money that’s allocated for wastewater and sewer systems? I think that’s right.
Sen Chesterfield: Story of my life. Thank you.
Sen Dismang: Do you all have any information on the DFA side about maybe something we can get to the members?
Brech (DFA): Robert Brech, DFA. Yes, they did have a process in place to get those grants out the door fairly quickly. And so it may very well be that those grants had to be in by November. I’m not sure the exact logistics of that, but they did have a plan in place to get that money out as quickly as possible so those systems could be fully built before the end of the time frame that ARPA funds could be spent. So it could very well be.
Sen Chesterfield: Mr. Chair, may I just ask of you that you would request these agencies to let the members of the assembly know when these grants are supposed to be going out, what those timelines are? I don’t think it’s too much to ask so that we can use our bully pulpit to make folks aware of these.
Sen Dismang: And I do think they went through that when they were here, and I just don’t remember what the discussion was at this point on the time frame.
Sen Chesterfield: I didn’t get any notice. Well, then just notify me if you would.
Sen Dismang: Again, and there’s no one here that can answer any questions on that whatsoever? If we could just plan on having someone come to ALC, maybe answer some general questions about the funds available, if they’ve all been allocated and how they’ve been allocated. It was my understanding we were going to get a report of that. So, hopefully, that’s coming if they’ve all been awarded.
Sen Chesterfield: Thank you, Mr. Chair.
Sen Dismang: Yes, ma’am. All right. It brings us to G 1.
Anderson (BLR): Thank you, Mr. Chair. In section G, these are reallocation of resources for DHS. DHS has special language that allows the department to make four reallocations a fiscal year to respond to changing client needs. This is the second reallocation this year. On the last page is a table that shows all their transfers. The first table shows appropriation transfers within divisions and totals approximately $12.1 million. There are four transfers. About $362,000 within shared services. And this is to provide additional short-term support for the division’s administrative needs and for the purchase of new servers and computer hardware. About $5.2 million within the Division of Aging Adult and Behavioral Health. And that’s for the Arkansas State Hospital and Adult Protective Services. And about $6.9 million within the division of Children and Family Services. This is to better align contract and board payments and to replace fleet vehicles. Then there’s also $36,000 within the division of childcare and early childhood education. And this is for the replacement of two fleet vehicles. The next table shows appropriation transfers between divisions. There is a transfer of a little over $21,500 in the regular salaries. This is from the Division of Aging Adult and Behavioral Health to Division Accounting Operations. And this is associated with two nurse positions that have moved to assist long-term care. The next table shows fund transfers of General Revenue funds between divisions. The department is requesting the transfer of $7.7 million in this reallocation. The transfers of funds between divisions are for meeting client needs and services and for annual support and reconciliations between divisions for cost allocation. The last table shows position transfers, and it shows the transfer of seven positions between the divisions to better serve functions within the Secretary’s Office and to support the teaming approach pilot program within DCFS. Madam Chair, that is the reallocation resources for DHS.
Rep Gray: All right, thank you. Are there any questions on that? All right, seeing none. I would accept a motion to approve. I’ve got a motion to approve item G1. and a second. Any discussion on the motion? All right, seeing none, all in favor?Opposed, nay. Motion carries.
Anderson (BLR): Thank you, Madam Chair. We’re going to move to the supplemental agenda for Section D of the supplemental agenda. It begins on page 12. So in that separate package on page 12, there’s a fund transfer for the Arkansas Department of Transportation. The Arkansas Highway Improvement Plan of 2016 took existing revenue streams and redirected them to our dot to produce $50 million for state match to pull down available federal aid. One of those revenue sources was interest earnings from the Treasurer Securities Reserve Fund. Arkansas code directs up to $20 million from the interest earnings to flow to the highway transfer fund and then requires ALC approval for a transfer to the department.
Sen Dismang: Thank you. Members, we have any questions on the transfer? This is D1 in the supplemental. We’ve got a motion to approve. I’ve got a second, any discussion. Seeing no discussion, all those in favor, signify by saying aye. All those opposed? Motion carries. H.
Anderson (BLR): Thank you, Mr. Chairman. We’re in section H. Now, these begin the items for review. First item in section H. This is incorporation of fund transfer. It’s for Division of Information Systems Special Language in the DFA. Dispersing Officer Bill allows the transfer from the Innovation and Project Development Fund to DIS. This is to support two positions, the state’s chief data officer and the state’s chief information security officer. The division is a cost recovery agency. They charge clients based on specific services provided and therefore they have difficulty assigning costs for these two positions that perform functions for the state more broadly. This request is to transfer $229,000. A breakdown on the next page shows how they determine the amount to transfer and this transfer requires review by ALC.
Sen Dismang: All right, thank you. Members have any questions on H1? Any discussion? I got a motion to review. I’ve got a second. All those in favor signify by saying aye. All those opposed? Motion carries. Section I.
Anderson (BLR): Thank you, Mr. Chair. Section I. We are in the cash appropriation request. The first one is a letter from the State Board of Pharmacy, Department of Health. This is for $19,500 in appropriation. This is to add video streaming capabilities to their AV system. Streaming was added as an option for applicants recently for their licensing process on reciprocity applications. The board said this process worked well and they would like to expand it. Next item, I2. It’s a letter from Division of Higher Education. This is for $250,000 in spending authority. This is to provide that spending authority for the grant to Arkansas community colleges that came from a restricted reserve fund transfer back in F3 on the agenda. The next item is I3. This is a letter from Division of Higher Education. This is for $100,000 in appropriation. It provides spending authority to make grants to schools to support those food pantries that was earlier in the agenda. I4 is a letter from Public Safety State Crime Laboratory. It’s for $1.3 million in spending authority. And this is to process sexual assault kits to reduce the current backlog. And again, this funding comes from a donation from the Attorney General and also from a restricted reserve fund transfer that was earlier in the agenda. I5 is a letter from the Division of State Police at Public Safety. It’s for $125,000 in appropriation. It’s a purchase gas masks for officer vehicles. The funding was provided by donation from the Attorney General’s office. The next two requests are on the supplemental agenda. These are items E1 and E2. And they begin on page 16 of that supplemental packet. So the first one, E1, is for Northwest Technical Institute. It’s $800,000 in appropriation. This is to buy trucks and trailers for the commercial driver’s license program, robots for their advanced manufacturing program, and an all electric vehicle for their automotive program. This comes from a grant from the Department of Education. Next item, E2, is for the Department of Veterans Affairs. It’s $1.4 million. This is to provide that spending authority from the restricted reserve fund transferring those earlier in the agenda this year. Those are all the cash flows.
Sen Dismang: Thank you. Representative Dotson, you’re recognized for a question.
Rep Dotson: Yes, item I4, the State Crime Lab. If available–.
Sen Dismang: If you could just recognize yourself in the committee, and then, Representative Dotson, you can move forward with your question.
Channel (Crime Lab): Kermit Channel, director of State Crime Laboratory.
Sexual assault kits and backlog
Rep Dotson: Thank you, Mr. Chair. The question I have is regarding these sexual assault, how far we are behind? How much does this catch us up? Or how much more would you need in order to catch us up?
Channel (Crime Lab): No, this will definitely catch us up. I think what we originally did, we wanted to outsource about 375 kits. So this is a little bit more than we’ll need because, with this funding, that we’ll actually be able to outsource all of our sexual assault kits and become flush where we need to be. And that is about probably 500 now. So the process would be to outsource to a qualified forensic laboratory, private laboratory, to do the processing, which we would also pay for court testimony in those cases should they occur.
Rep Dotson: So this will catch you up. Will this keep us current going forward then?
Channel (Crime Lab): Yeah, I do believe it will because one of the things it does, it lets us complete the hiring process because we don’t have all our personnel hired yet because we are having difficulty finding qualified individuals to fill the position. And, obviously, it takes a year to train them. So while this process is going on, it will help us to get to where we need to be with existing cases that have already been started in the laboratory, both homicide, and sexual assault. So it should get us on a very good playing field to address these kinds of issues in the future.
Rep Dotson: Excellent. Thank you very much. I appreciate it.
Sen Dismang: Members, we have any other questions? All right, seeing none, we have a motion to review items I1 through 5, E1 and 2 from supplemental. We’ve got a motion. Got a second. Discussion? Seeing no discussion, all those in favor, signify by saying aye. All those opposed? Motion carries. J1.
Anderson (BLR): Thank you, Mr. Chair. We’re in budget classification transfer request. There’s only one on the agenda for the Public Service Commission. This is a request to transfer $12,500 from operating and conference expenses to capital outlay. It’s to replacement vehicle for the pipeline safety program. The request notes the price of vehicles has increased since the original budget was requested.
Sen Dismang: Members, any questions on J1? Alright, seeing none. All right, items will stand review. All right, K.
Anderson (BLR): Thank you, Mr. Chair. Section K are the miscellaneous federal grant appropriation requests. The first item is K1. This is Department of Commerce, Insurance Department. It’s for $257,000 in appropriations to spend federal funds. They have a grant from the Department of Health and Human Services to provide application assistance to people likely to be eligible for the low-income subsidy program for Medicare. This grants for priority one funding, which will go to contracted vendors, radio advertisements, and general operations. The next item, K2, is, again, Insurance department. This is for $249,000 in appropriation. This is priority two funding for the same low-income subsidy program. And this is to pay all Area Agency on Aging vendors. Next item is K3. Again, Insurance Department. It’s $48,000. And this is for priority three funding that goes to outreach and training. K4 is Department of Agriculture. This is for $226,000 in appropriation. It’s a grant from FEMA to rehabilitate high-hazard dams in poor condition. This grant requires a 35% state match. Next item is K5. This is for Department of Agriculture again, but this is pulled by DFA request, so we’ll move forward to K6. This is for DHS, Division of Childcare and Early Childhood education. It’s for $40 million in appropriation. It’s a grant from the Health and Human Services Department to serve the increase in families requesting early childhood education services. This particular grant is for IT maintenance and enhancements. Next item is K7. Again, Division of Childcare and Early Childhood Education. It’s for $2.2 million in appropriation. They have a grant from USDA to help schools purchase minimally processed foods from locally socially disadvantaged farmers and producers. The next item is K8, DHS Division of County Operations. It’s for $2.28 million. They have a grant from HUD to renovate, rehabilitate, or convert small buildings for emergency shelters for the homeless. K9 is Department of Labor and Licensing, Division of Labor. This is about $3,500. I’m sorry. They have a grant from the Federal Department of Labor and this portion will be used to cover employee performance increases. It requires a 50% state match. The next item is also for the Division of Labor. This is for $132,000 appropriation. They have a grant from the Department of Labor to cover employee performance increases and to provide for operating expenses of re-appropriated federal funds. This portion of the grant requires a 10% state match. And this is for the OSHA section. And K11 is for Department of Parks, Heritage, and Tourism, Mosaic Templers Cultural Center is for $2,000 in appropriation. They have a grant from the Institute of Museum and Libraries for an exhibit that interprets the African-American experience in Arkansas and requires a 50% state match. Mr. Chair, those are all the MFGs.
Sen Dismang: Thank you. Representative Hodges, you’re recognized for a question.
Rep Crawford: Representative Crawford here. Thank you. I’m not on the committee. Thank you for allowing– my question is on 8 with the–
Sen Dismang: Department of Human Services?
Rep Crawford: Yes.
Sen Dismang: County Operations. Anybody here can answer a question? If you could, just recognize yourself for the committee, and you’re welcome to move forward with your question.
Franklin (DHS): Good morning. This is Mary Franklin, director of the Division of County Operations for the Department of Human Services.
Homeless shelter grants
Rep Crawford: Good morning. How are you today? We have talked a little in the past, so I wondered, our homeless shelter, one of ours, the Riverview Hope Campus, was denied funding from this grant, the ESG grant, because they had received some COVID money. Will this put them back in play to receive this money?
Franklin (DHS): So this is an appropriation request so that we have the appropriation to administer this current year’s regular emergency solutions grant. And those applications, we have already done the application process for that, but we are still using an ESG COVID grant, which ends in September. And so in an effort to make sure we had coverage statewide, we did look at how much other funding that any of our applicants had when we were determining how to distribute this amount of funds. But we are reviewing those quarterly, and if the funds are not being spent where we have currently allocated them, we are taking action to be able to reallocate those funds. So it’s a possibility that other agencies may be able to get additional funds as we do these quarterly reallocations and assessments. And then, of course, we will take applications for the next grant year. And of course, anyone is welcome to apply for these grants.
Rep Crawford: Okay, follow up, please. Can you help me understand why all these agencies were given extra money through COVID, ARPA, whatever you want to call it, but then the state agency then pulls the money back from places like homeless shelters to where they are now in dire straits trying to keep their organizations going for the homeless people, which there are more homeless people because of what we’ve been through. I just don’t understand that. Is there a simple answer to that?
Franklin (DHS): Well, what I can share with you is that the $2.2 million that we’re requesting today in appropriation is the normal, the regular ESG grant, that Arkansas has typically been receiving. During COVID we received more than 10 times that to allocate, and that grant expires in September. Unless there is some type of federal action taken that would extend that COVID money further, it’ll end in September. So we received an influx of funds that we have never seen in this program before, but when it ends, we are going back to allocating $2.2 million instead of $30 plus million for these same programs. So there is just not going to be as much money.
Rep Crawford: I understand, but they were told they couldn’t have it because of the money they had received. So maybe we need to talk offline. It’s just very frustrating. Thank you.
Sen Dismang: And just real quick, I mean, there was some one-off– there’s some entities that were getting specific money through ARPA, and I think that there’s been a discussion about establishing more of a grant program that all these entities can apply for. And where are we at in that process?
Franklin (DHS): So this grant is not through ARPA.
Sen Dismang: No, not this grant. I’m talking about the– so there’s some ARPA money if you look higher in our agenda, I believe there’s some of these organizations, I think, if I understand things right, that we’re kind of holding off on, waiting on a bigger plan. Everyone has the ability to apply. Where are we in developing that? I’m assuming that’s y’all that would be creating that, or is that DFA?
Franklin (DHS): I’m sorry, I’m not familiar with that application process.
Sen Dismang: I don’t know how you- Yes, my understanding was that some of these shelters– we were going to develop a statewide plan. That way everybody could be able to make an application. We could see statewide need and make sure we’re filling holes where we needed to. And that’s why we’re holding off, Senator Chesterfield, on some of the items that were above. I would have anticipated that her department would have been critical in developing that plan. And if she’s not aware of the plan, then maybe it hasn’t been developed. Where are we in developing– and I’m sorry, I didn’t mean to throw you into that. I’ve made an assumption that was bad. Where are we in developing that? Because again, to Senator Chesterfield’s question, I think some of these projects she would like to get funded, and we’re waiting on kind of a more comprehensive look before we do that.
Babbitt (DFA): Andy Babbitt, DFA. You’re absolutely right. We’re working on a comprehensive plan for both– what I think the overall term is– my understanding is Behavioral Health. So I’ve had discussions with the Division of Behavioral Health at DHS to come up with a more comprehensive plan. So that’s going to be your mental health, your addiction programs.
Sen Dismang: Well, but beyond that, we were talking about some of these shelters, and I guess that ties in because the behavioral health– there were some specific projects, in particular in the River Valley, that were getting funded for behavioral health.
Babbitt (DFA): Correct.
Sen Dismang: And again, it was hard to understand the reasoning behind that project, maybe over others. My understanding, we were looking at nursing, we were looking at these shelters, and we were looking at behavioral health and education.
Babbitt (DFA): Correct.
Sen Dismang: So the others’ getting lumped in with behavioral health, these shelters are?
Babbitt (DFA): No, sir. We’ve got the domestic violence piece that we’re working on right now.
Sen Dismang: There we go.
Babbitt (DFA): We’ve also got behavioral health, which will cover addiction, mental health. We’ve got the education for nursing and allied health, and then we’ve got a hospital. And so we’ve got four plans we’re currently working on to develop a more comprehensive focus on the state as a whole.
Sen Dismang: Okay. And so for those shelters, though, she’ll get looped in at some point, I think. It would make sense to, maybe.
Babbitt (DFA): Yes, sir.
Sen Dismang: Okay, thank you. All right, any other questions? All right, seeing none– and hopefully, that helps with some of your questions, Representative, on the ARPA funding side. All right, members, no other questions? Any objections to items 1 through 4? K1 through 4, 6 through 11. Seeing no objections, those items will stand reviewed and we’re to the reports.
Anderson (BLR): Thank you, Mr. Chair. We’re in section L. These are the quarterly reports. The first one is for DHS interagency and interdivisional match fund transfers. And this shows those transfers required in their special language. The report shows over $3.1 million in transfers from the individual divisions’ fund accounts to the corresponding grant payment accounts. L2 is the Office of Attorney General cash settlement fund. And this report shows the quarterly cash account activity. The report details seven settlements and shows the balance of the cash funds, their cash receipts, their disbursements, and a transaction detail report. L3 is the Division of Arkansas State Police asset forfeiture expenditure report, and it shows these expenditures for each quarter of the fiscal year. The first page of the report shows $42,000 in expenditures. That’s for the first quarter out of the TPC 0100 fund. This is a fund for federal asset forfeiture. And on the second page, it shows $15,000 in expenditures in the first quarter of the TPC 0200 fund. And this is a fund for state asset forfeitures. L4 is the federal grant applications and awards report. And this report shows all the federal grant applications awarded by state agencies in the first quarter of the fiscal year 2023. Mr. Chair, those are all the quarterly reports.
Sen Dismang: Thank you, members, are there any questions– or thank you. Members, are there any questions on the quarterly reports? All right, seeing none, the reports are reviewed. Monthly reports.
Anderson (BLR): Thank you, Mr. Chair. We’re in monthly reports. M1 is the surplus income and distribution report, and this shows the sources of unobligated funds and then the distributions from the rainy day, restricted reserve, and long-term reserve funds, as of the end of last month. The rainy day fund shows $15.7 million in distributions and a balance of $807,000. That new balance after today’s distribution of $100,000 will be $707,000. The restricted reserve fund shows almost $198,000,000 in distributions and an overall balance of $223,000,000. On today’s agenda, there was $37.9 million in transfers. If those are all approved on Friday, the new balance for the restricted reserve fund overall will be $185,000,000. The total catastrophic reserve fund balance is $1.27 billion. M2 is the budget stabilization trust fund report, and this shows the cash flow loans throughout the fiscal year. As of the end of last month, there are $16.2 million in outstanding loans, and the cash balance is $178.9 million. M3 is the tobacco settlement report, and this report gives a summary of income, fund balances, investments, actual payments to the state, and on the second page are all expenses by fiscal year. M4 is the state central services report, and this shows the fund balance and disbursements as well as the expenditures of each agency supported by the fund. And lastly is the American rescue plan report. This is M5. The first five pages of the report show requests that were approved by the ARP Steering Committee. That is the portion of the state has discretion in awarding. On the sixth page begins attachment A. That’s a report of ARP funds that were sent directly to state agencies from various federal entities. And then on page twelve is attachment B. That’s a report of the ARP funds that were sent directly to institutions of higher education.
Sen Dismang: All right, members, any questions on the monthly reports? Seeing no questions, those reports will stand reviewed. And then do we have any other business? All right, seeing none, members, thank you for your time this morning. And with that, we are adjourned.