story by Roby Brock, a TCW content partner and owner of Talk Business & Politics
roby@talkbusiness.net
Republican gubernatorial candidate Asa Hutchinson has been touting his jobs plan for Arkansas, which includes tax competitiveness, workforce education, health care and regulatory reform, education choice and computer science expansion.
In a Talk Business & Politics interview, Hutchinson spelled out aspects of his plan and how to pay for it, while noting his interest in reforming the state’s regulatory agencies, including a push back on the federal government.
“Whenever you look at our regulatory environment, the big problem is we’re not processing our permits for air quality, for manufacturing facilities quick enough,” Hutchinson said.
He noted that states like Louisiana and Texas fast-track regulatory permits and it makes them more business-friendly in reputation.
“This is what industry wants you to be responsive to. They want to protect the environment, let’s just move it through very quickly,” Hutchinson said. He expounded on these regulatory comments, which you can read deeper in this post. His full interview can also be viewed at the bottom of this report.
Hutchinson faces Democrat Mike Ross, who appeared on Talk Business & Politics last week, as well as Libertarian Frank Gilbert and Green Party nominee Joshua Drake in the general election this fall.
TAX REFORM
The crux of Hutchinson’s tax reform plan includes cuts to those making roughly between $20,000 and $75,000 annually. He wants to lower the individual income tax rate for those in this income range by a full percentage point — a plan that comes with an estimated $100 million price tag.
“It’s not a complicated plan,” Hutchinson said, noting that surrounding states are lowering their rates or don’t have individual income taxes. “We are an island of high tax rates in Arkansas for individuals.”
Hutchinson said in calculating his tax cuts, he aimed to help what he feels is the segment of society needing the most relief. Higher income individuals are not in as dire a situation, and Hutchinson said there are other programs in existence to help those with income levels lower than $20,000.
“We’ve created a lot of programs for those in the lower income categories,” he said. “It’s the middle income that’s hurting.”
Hutchinson’s tax plan is predicated on growth revenue in future years and he contends that the current two-year budget surplus of $174 million can be the springboard to start his tax cut offerings.
“We have that amount in surplus so it gets you through the point you can grow into the next phase, so I think it’s a very prudent approach,” he said.
If revenue growth in future years were to taper or not meet expectations to sustain or grow tax cuts, Hutchinson said he’d have to calculate trimming or not trimming cuts based on the overall budget picture.
“You always put together the budget as a whole… I don’t believe there’s any doubt we can do what I outlined,” Hutchinson said. “If our growth does not materialize as expected, you’ve got to make tough decisions. We’ll wait and see when we get there.”
EDUCATION, COMPUTER SCIENCE
In his jobs plan, Hutchinson refers to providing more “education choice” for Arkansans, but there are few details attached. His web site offers more commentary on the subject, including charter schools, Common Core, and pre-K education.
He notes that his kids attended public schools, private schools, parochial schools and were home-schooled.
“We have to recognize that parents may make different choices in education for their children. Some parents will choose home school, private school or public charter schools as an alternative to the traditional public school setting. It is important that these options are available even though our tax-payer resources go to the public school system including public charter schools,” Hutchinson says on his web site.
Hutchinson’s Democratic opponent, Mike Ross, has advocated a significant expansion of pre-K opportunity in Arkansas including eventual inclusion for families making up to 400% of the federal poverty level (FPL). Hutchinson has limited his campaign promise to funding pre-K education for families under 200% of FPL.
A big component of Hutchinson’s education plan centers on computer science at the K-12 level. He has proposed ensuring class credits for computer science courses as well as making those courses available in every high school across the state. He contends the price tag would be less than a half million dollars to implement.
“The hardware and software is already being put in to the schools, so let’s double-utilize it for the purpose of teaching computer science,” said Hutchinson. “It doesn’t cost anything to change the law to give credit for computer science for math or science graduation credit.”
He says there will be some costs associated with retraining math or science teachers in order to have one computer science teacher in every high school across the state. His projections suggest a minimal financial impact on the state budget to achieve that.
“We’ve looked at the training costs there. You could probably do it pro bono because there are so many groups that want to teach coding for computers in high school to develop the curriculum, but the training costs would probably be a half million dollars. It’s a very modest investment for an incredible return,” Hutchinson said.
He added that an annual 5% boost in computer science coders would add 1,500 potential new trained workers into Arkansas’ labor force and would, in time, “change the economy.”
WORKFORCE EDUCATION, HEALTH CARE
Hutchinson has advocated for the creation of eight workforce councils across the state to regionally develop job plans between educational institutions, employers and workers.
To some, the plan is redundant to existing efforts but Hutchinson sees unique opportunities in different areas of the state. For instance, he said a workforce plan in Mena should look different than a strategy in Mountain Home despite both areas attempting to recruit tourism.
“[Mountain Home] has a focus on the retirement community. They have manufacturing. So their economic plan in that region will say, ‘These are the jobs that we want to prioritize for the next decade,’” he said. “If that’s your economic plan, then let’s do our workforce education to train towards the jobs.”
Hutchinson has deployed an acronym – “P.R.E.P.A.R.E.” – to summarize his workforce education goals. In his plan, “P.R.E.P.A.R.E.” suggests providing resources, producing students with skills in demand, and retaining and growing jobs in Arkansas.
Sunday’s interview did not focus on health care reform, but Hutchinson has previously outlined several positions on the subject. He’s opposed to the Affordable Care Act, calling it a “job killer” that is “fatally flawed.” Hutchinson advocates continued Medicaid reform and includes the “taxpayer funded private option” as one of those components.
Hutchinson has called the private option “a pilot program.” He’s stopped short of calling for its cancellation, but he’s also not rallied for its continuance.
“The current private option is an innovative approach to expanding health care in Arkansas, but we must measure its effectiveness and costs,” Hutchinson says in his jobs plan. “If it is not affordable for Arkansas, or it does not accomplish our goals, then we will need to end or change the program.”
REGULATORY REFORM
While Hutchinson wants to expedite permitting processes for businesses needing regulatory approval as was noted earlier, he provided an example of a permit issued with too little public notice.
He said he supports efforts to protect Arkansas’ natural streams and has concerns about how a controversial large-scale hog farm permit was issued in north Arkansas near the Buffalo River. Hutchinson said he wouldn’t push to shut down the current hog farm operation that was approved in the area, but he wants to see the permitting process “tightened up” in the future.
“Obviously, it is a regulation that is important to protect our streams and our water quality that we value in our state. I grew up on the Spavinaw Creek drinking out of the stream,” he said. “But the farmers didn’t do anything wrong. The farmers went through the permit process, so don’t penalize the farmer. But first of all, my commitment is to protect the [Buffalo] river, and then secondly, you’ve got to make sure you tighten up the permitting process so that everyone has the notice – all the stakeholders, which they seemed not to have the last time, not adequate notice out there. So the farmers did absolutely nothing wrong. They followed the rules, so don’t penalize them. But let’s protect the Buffalo River and the quality of life that we so value in this state.”
Hutchinson said he planned to push back against “overreaching regulations from the federal level” saying there is a state role to play. Citing new EPA regulations regarding carbon emissions, He said he would organize industry and state regulators to coordinate public comment in opposition to the rules. When asked if organizing public comment would be adequate to halt implementation, Hutchinson said it should have some impact.
“I would like to think the administration is very sincere about inviting public comment. Why do you have public comments? It’s because you want to take those into consideration as to how you move forward,” he said.
However, Hutchinson also advocates a more aggressive state approach to federal regulatory policy.
“I think there is some question as to the legal authority for those regulations and the state should consider challenging those regulations. This is a different approach to a regulatory environment,” said Hutchinson.
On the state level, Hutchinson wants to start with a moratorium on new regulations.
“The second thing I would do is put in a moratorium immediately as I become Governor so that we would stop the new regulations coming into place without a cost-benefit analysis going into place,” he said.
Link here for the full video interview with Hutchinson.