Summary: The meeting opened with remarks recognizing Representative Lane Jean for his 12 years as chair of the Joint Budget Committee and praising his leadership, mentorship, and role in helping build the state’s reserves. Vice Chair Representative Johnson and others thanked him for his service and noted the significance of the leadership transition. The committee then took up its only item of business, House Bill 1002, the General Appropriation Act. There were no questions on the bill, and a motion to do pass was made, seconded, and approved by voice vote. Members were informed that the committee would reconvene the next day at 9 a.m. to assign bills to committees only, with no other actions planned, and that the chamber would return to session at 10 a.m. The meeting was then adjourned.

Summary: The transcript covers the opening of the Arkansas House and a joint session of the 95th General Assembly’s fiscal session. The House first established a quorum, granted leave for absent members, recognized guests, and adopted House Resolution 1001 to convene a joint session with the Senate for Governor Sarah Huckabee Sanders’s address. Several bills and resolutions were read for the record, including House Resolution 1002 and House Bills 1001, 102, and 103, before the House recessed to await the Senate and then the governor. In the joint session, leaders recognized the late Representative Stan Barry with a moment of silence, introduced constitutional officers, judges, and other guests, and appointed committees to escort the governor. Governor Sanders then delivered a lengthy fiscal-session address focused on her budget priorities and policy agenda. She emphasized continued funding for education under LEARNS, teacher pay and literacy gains, public safety and law enforcement funding, government efficiency and tax cuts, and the 1033 initiative aimed at helping vulnerable Arkansans move from crisis to self-sufficiency. She also urged lawmakers to avoid new Medicaid mandates or ongoing spending and said she would call a special session to cut income taxes further if the budget is passed. After the governor’s remarks, the joint session adjourned. The House then reconvened briefly, adopted a motion to adjourn until the next day, and announced that the Joint Budget Committee would meet later that afternoon and again the following morning.

Summary: The committee heard extensive public testimony from youth advocates and public health speakers urging action on vaping. Witnesses said flavored products and social media are driving youth use in Arkansas, described nicotine addiction and health harms, and asked lawmakers to prohibit vaping in public indoor spaces, align vape rules with smoke-free laws, and expand prevention efforts. Committee members thanked the speakers and encouraged them to continue building support for future legislation. The main presentation was an overview of Arkansas’s Rural Health Transformation Program, a five-year federal initiative funded through CMS. State officials said Arkansas received about $209 million for the first year and may receive roughly $1 billion over five years if performance is strong. They emphasized that the program is intended for targeted, locally driven transformation rather than general operating support, debt relief, or new construction, and outlined four initiatives: Heart, PACT, Rise, and Thrive, focused on prevention, access and coordination, workforce development, and technology. Officials said applications would open in the spring, with a reimbursement-based process and a goal of launching all four initiatives by June. Members asked detailed questions about eligibility, rural definitions, school gardens, faith-based and nonprofit partnerships, mobile clinics, EMS, behavioral health, residency slots, and whether urban providers serving rural patients could apply. Officials said the program would favor regional collaboration, could support targeted renovations and expansion of existing programs, and would allow residency growth and some equipment or infrastructure purchases, but not food purchases or permanent new construction. They also said a committee of state health and finance officials would review applications, with heavy technical assistance and an expectation of quick turnaround. The committee also reviewed two DHS/Health Department rules. One implemented Medicaid and CHIP coverage and care coordination for eligible incarcerated youth before and after release, including targeted case management and screening services, with no public comments received. The other updated audiology licensing rules to reflect recent acts expanding scope of practice and changing the renewal deadline. Both rules were reviewed without objection, and the committee adjourned.

Summary: The committee heard presentations on three Arkansas programs serving students and adults with autism and other developmental disabilities. University of Arkansas representatives described the Empower Program, a non-degree, four-year inclusive postsecondary program for young adults with mild intellectual disabilities, and the Autism Support Program, which provides intensive academic, peer, and career coaching for degree-seeking students with autism. They explained the programs’ person-centered planning, residential and employment supports, fee structure of $5,000 per semester for each program, and scholarship/fundraising efforts to offset costs. Members asked about dorm arrangements, mentoring, individualized plans, and how students move in and out of support services, and the presenters emphasized independence, integrated campus life, and transition planning. Pulaski Technical College staff then presented the 3D program, a three-year transition program in culinary, baking, and hospitality for students with intellectual and developmental disabilities. They outlined integrated classes, internships, job placement outcomes, and data showing strong completion and employment retention rates. Questions focused on how success is measured, tuition and financial aid, and the challenge of securing community partners for practicum and employment sites. The presenters said the program uses rubrics that include technical and professional skills, charges $5,700 per semester, and is pursuing accreditation through the Inclusive Higher Education Accreditation Council. The final presentation was from SLS Community, a Fayetteville nonprofit serving neurodivergent adults through residential supports, supported employment, and community initiatives. Leaders described their vision for a future mixed-use “live-work-play” development at Cato Springs, current residential and vocational services, and community events such as a 5K and a neurodiversity health care conference. Family members testified about the need for adult services, trained direct support professionals, and better reimbursement and behavioral health supports after age 21. No formal votes were taken beyond approving the prior meeting minutes, and members also announced upcoming autism-related events and requested future discussion on task force appointments and ABA-related issues.

Summary: The council opened with a prayer, approved the prior meeting minutes, and received the February 2026 Monthly Revenue Report from Carlos Silva of the Bureau of Legislative Research. He reported gross revenues of $5.36 billion and net collections of $4.5 billion, both above the prior year to date, and said the updated forecast now shows a larger expected surplus. Members asked about declines in some tax categories, natural gas severance fee fluctuations, inflation, and economic development incentives; Silva attributed several changes to timing, refunds, tax cuts, weather, and price volatility, and generally described the state’s revenue trend as positive. The Executive Committee, Administrative Rules, Claims Review, Game and Fish, Higher Education, Infrastructure Investment and Jobs Act, Medicaid studies, Occupational Licensing Review, State Insurance Programs Oversight, and other subcommittee reports were adopted. The Medicaid studies report drew extended discussion about DHS staffing and contract nursing costs at state hospitals and human development centers; DHS officials said they were working on a recruitment and retention plan, reported significant vacancies and turnover, and said the state was not at risk of overspending the contracts. Several members urged reducing reliance on contract labor and moving staff onto state payrolls. The Review Subcommittee report prompted questions about a Department of Public Safety aircraft maintenance item and a Department of Shared Administrative Services contract for Deloitte to implement performance and goals management software tied to the state’s new personnel system. After discussion, the aircraft maintenance item was held briefly and then withdrawn from the hold, while the shared services contract was explained as a one-time integration/configuration project for a system that will support employee evaluations and performance-based pay; the report and the separate contract vote were approved. The Personnel Subcommittee also heard testimony from Commerce Secretary Hugh McDonald about reductions in force at the Division of Services for the Blind, which he attributed to funding shortfalls and fiscal mismanagement; members questioned the impact on blind and visually impaired clients, the status of board appointments, and whether federal funds could be at risk. The report was adopted with immediate consideration, and the meeting ended after filing the remaining APER report and adjourning.

Summary: The Early Childhood Committee met for an update from the Office of Early Childhood within the Department of Education. Members heard that the office’s goals under the LEARNS Act are to improve kindergarten readiness, support families, ensure quality providers, and expand affordable, accessible child care. Staff reviewed the local lead system, licensing, quality efforts such as CLASS and QRIS, and the two main funding streams: School Readiness Assistance (SRA), a federal CCDF-funded voucher program serving about 14,600 children with a wait list of a little over 3,000, and Arkansas Better Chance (ABC), a state-funded program serving about 21,000 children with authority recently increased to 24,000 slots. A major topic was the difference between market rate surveys and cost analysis studies. Officials said the department is procuring both through an RFP, hoping to begin by August and have results by late in the year. Members pressed for current reimbursement levels, the gap between ABC and SRA funding, and whether ABC funding should be increased to better match costs. Staff explained that SRA rates are set at 75% of the market rate, while ABC per-child funding is much lower, and that ABC slots are limited by the overall allocation. They also explained that some ABC slots were increased by moving children from a discontinued federal pre-K arrangement into ABC to preserve continuity of care. Committee members raised concerns about rural access, infant and toddler shortages, provider stability, workforce pay, and communication with families and providers. Officials said local leads are now helping identify underserved areas, that no county with absolutely no care is known, and that the department is trying to get a truer statewide count of children and providers. They also described efforts to improve communication through monthly provider calls, website postings, and direct case contacts with families. Members discussed possible funding increases, including ideas to reduce the SRA wait list and raise ABC funding, but no formal vote or action was taken beyond approving prior meeting minutes and receiving the update.

Summary: The Administrative Rules Subcommittee reviewed several agency rules and most were approved without objection. The Department of Agriculture moved to repeal rules tied to the now-repealed Arkansas Catfish Processors Fair Practice Act. The Department of Human Services updated Medicaid policy to clarify that pregnant women may still be referred to child support enforcement but will not be sanctioned during pregnancy and the 60-day postpartum period, removed the word “forcible” from rape/incest good-cause language, and eliminated a 90-day waiting period for ARKids B when group health coverage ends. DHS also received approval for a CMS cell and gene therapy model for sickle cell disease and a technical Medicaid medication-assisted treatment update that does not change coverage. The Department of Labor and Licensing presented several rules. One created procedures for the department to issue interpretations in local construction plan disputes under Act 591 of 2025. The Contractors Licensing Board and Residential Contractors Committee amended rules to raise the restricted commercial license threshold and light building project limit from $750,000 to $1.5 million, and to allow deferral of owner-complaint investigations while related civil litigation is pending. The HVACR Licensing Board presented broader cleanup and policy changes under Act 746 of 2025, including eliminating the Class C license by moving those holders into Class B, expanding work limits for Class A and B licensees, changing continuing education to eight hours per three-year code cycle, and keeping annual license renewal. Members asked detailed questions about impacts on businesses, training, youth working with parents, and whether any unintended burdens were created; the board said it had notified licensees and had received little pushback. The committee also granted the Department of Inspector General’s request for exclusion from rulemaking reporting for Act 473 of 2025, concluding that the statute was sufficiently detailed and did not require additional rules. In addition, the Arkansas State Library’s report was accepted, with the Department of Education stating that the library’s three existing rules should remain in effect. During the update on outstanding 2023-session rulemaking, Education explained that many delayed rules were held back because they were likely to be amended again in 2025, and members expressed concern about the length of time some rules have remained unfinished. The meeting ended after written 2025 rulemaking updates were noted, with no further action taken.

Summary: The Executive Subcommittee met and first considered a waiver request from the Stuttgart School District to use the TIPS interlocal purchasing system for a turf replacement project instead of a traditional competitive bid. Superintendent Jeff McKinney explained that three bids were received but none fully met the RFP specifications, including warranty and insurance requirements. After review by the district’s architect, the committee approved the waiver request by voice vote. The committee then approved a consultant services agreement between the Bureau of Legislative Research and Work Ed Consulting to support the Hospital Medicaid Developmental Disability Subcommittee’s study under Act 145. Legislators said the consultant would help develop workforce-system reform legislation for the 2027 session, and noted the firm’s experience in other states. The contract runs through June 30, 2027, with a maximum amount of $158,000, and was approved without opposition. Next, the committee approved an actuarial and consultant services agreement with Perrin Knight to provide ongoing actuarial support for the state property insurance captive and related legislative oversight work. Bureau staff said the contract would run from April 1 through December 31, 2027, with a maximum amount of $475,000, though only actual hours and travel would be billed. Members asked about budgeting, invoice timing, and overlap with other insurance consultants, and the agreement was approved. Finally, the committee approved using Bureau committee room funds to renovate Committee Room C in the Big Mac Building, citing outdated audiovisual equipment and the need to update the room to match other recent renovations before adjourning.

Summary: The committee met and first welcomed a visiting group from Arkansas State University’s Medical Laboratory and Radiation Sciences program. It then suspended the rules to take up a supplemental report, which was approved and noted as reviewed without objection. Members reviewed the Arkansas Fire Protection and Licensing Board’s occupational report. Counsel for the Department of Labor and Licensing said there had been no fee increases, and the report was accepted without objection. The committee then heard from the Arkansas Department of Health’s Radiation Control Section, which described its radiologic technologist licensing program, including full and limited-scope licensure, unchanged fees since 1999, and a recent operating deficit covered through cost allocation. Members asked about the deficit, possible future fee changes, and whether apprenticeship pathways might be added; the agency said it was not currently planning fee increases and would accommodate apprenticeship if such programs are created. That report also stood as reviewed. Finally, the Arkansas State Board of Physical Therapy presented its report, outlining its licensing and disciplinary role, current licensee counts, compact participation, and recent growth in licensees. The board highlighted lower fees, a $200,000 scholarship program for 10 recipients per year, and a large fund balance that is being reduced through fee cuts and scholarships. Members asked about the scholarship details and the effect on reserves. The report was accepted without objection, and the meeting concluded with no further business.

Summary: The meeting opened with a report on annual solvency certification for institutions of higher education, which required no action and was to be distributed later. The main presentation focused on artificial intelligence in K-12 and higher education, delivered by students from Arkansas State University, the University of Central Arkansas, and Valley View High School. They argued that AI is becoming central to education and the workforce, especially as Arkansas adds major data center investments, and said students should be taught to use AI responsibly so they can compete for jobs, improve internships, and keep talent in-state. They also emphasized concerns about academic integrity, cybercrime, and the need for ethics training and district-level guidance. The presenters shared survey findings from educators in several Arkansas districts, saying most teachers support teaching responsible AI use, believe students without access to AI will be disadvantaged, and want training and district-level management. They described existing AI uses at Arkansas colleges, including AI tutors, AI-generated practice exams, homework feedback tools, and classroom applications in business, climate science, and urban forestry. They also proposed an AI library built on the state’s Access Act infrastructure so K-12 and college students could access shared AI tools and resources across Arkansas. Committee members asked about student attitudes, classroom concerns, and whether AI could help standardize course materials and objectives across institutions. The presenters said reactions among students are mixed, with arts students especially worried about copyright and originality, but that many recognize AI’s real-world value. A UCA representative added that faculty training, ethics discussions, and academic dishonesty guidance are already underway there. The chair thanked the students, noted their work on related research projects, and then moved to a second presentation from Pine Bluff community leaders. The Pine Bluff group described community-based school support efforts, including the Pastors on Patrol program, mentoring, anti-bullying and nonviolence training, drug and vaping education, leadership clubs, and a youth diversion effort for students at risk of detention. They said their work is aimed at improving school climate, encouraging citizenship and scholarship, and reducing negative behavior. Members praised the group’s efforts and asked about expanding the programs to other districts; the presenters said their model and curriculum can be shared and adapted. The meeting ended after the chair thanked both groups and adjourned with no further business.

Summary: The committee received an update from Grant Wallace on the state employee Medicare Advantage group plan and the ongoing rebid with UnitedHealthcare. Wallace said the agency is exploring “decoupling” the medical and pharmacy portions of the plan, and that preliminary estimates suggested potential savings of about $100 to $200 per participant per month. He said the final CMS rate-setting process would conclude in April, with a revised contract amendment likely to come before the committee in May or June after review by the EBD Advisory Commission and State Board of Finance. He also clarified that the plan covers post-65 teacher and state employee retirees, including retirees from state agencies and K-12 public schools. Representatives from Segal Consulting then gave a broader presentation on Medicare Advantage and Part D market trends, reviewing Arkansas’s prior decision to adopt a Medicare Advantage prescription drug plan and the savings generated since the 2023 RFP. They explained that the Inflation Reduction Act significantly changed Part D financing by shifting more federal support into a direct subsidy tied to risk scores, which makes accurate risk adjustment more important and creates a larger difference between Medicare Advantage prescription drug plans and standalone Part D plans. They said this has led to a growing divergence in funding, especially for standalone Part D, and is the main reason decoupling medical and pharmacy coverage is being considered. Committee members asked about how the risk-score changes affect costs and members. Segal said the new structure has reduced member out-of-pocket costs, with the annual cap now at $2,000 and many members reaching it after roughly $600 to $800 in spending, but that the plan absorbs more of the cost. They also said the market appears to be adjusting through annual bids, and that a decoupled structure could allow the state to capture more favorable funding on the Part D side. No votes were taken, and the committee adjourned after being told to expect further information once the April rate notice and renewal proposal are available.

Summary: The committee first took up several personnel and compensation requests. It approved a Department of Parks, Heritage and Tourism reclassification that would trade three administrative coordinator positions for one park superintendent, one maintenance supervisor, and one park manager. It also approved one-time bonus and recruitment plans for the Department of Commerce and Department of Veterans Affairs, including up to $5,000 bonuses tied to the unemployment insurance modernization project and $2,000 bonuses for certified nursing assistants at the state veterans homes. A Department of Health request to reinstate a previously frozen fiscal support manager position for the State Medical Board was also approved; members were told the position was already authorized and would not increase total positions. The committee then reviewed a Department of Commerce reduction in force affecting the Division of Workforce Services for the Blind and Employment and Training divisions. Secretary Hugh McDonald and Workforce Connections Director Cody Waits explained that the cuts were driven by over-obligated federal funds, a prior realignment, and what they described as long-standing fiscal mismanagement in the Division of Services for the Blind. They said 56 employees remained furloughed, five employees in a separate grant group were still working, and 17 positions were on the permanent RIF list. Senators questioned the division’s accountability structure, the role of the independent board, and whether the layoffs were being handled fairly, including a request for racial composition data on the workforce and the RIF group. Members also discussed quarterly employment and overtime reports. Staff explained that the reports cover average staffing levels over each quarter, and members focused on overtime spending, especially in DHS, the Department of Correction, and the Department of Transportation. OPM said overtime is being reviewed, direct care positions remain exempt from the hiring freeze, and agencies have been hiring more staff since the new pay plan took effect. The committee asked for additional reporting on overtime trends, and the meeting adjourned without further action.

Summary: The committee considered a series of appropriation, fund transfer, and reserve requests across multiple agencies. Section B temporary appropriations included funding for state technology upgrades, personnel management staffing and IT skills assessment, court reporters and interpreters, crime victim claims, juvenile sex offender assessments, radiation lab testing, and higher education workforce grants and credentialing pathways. Additional items covered an ARPA grant for the University of Arkansas Fort Smith LPN program, an IIJA grant for the Oil and Gas Commission’s critical minerals work, a restricted reserve transfer for State Police vehicle purchases, a transfer to the Arkansas Heroes Program, and cash fund requests for the Real Estate Commission’s AV system and HVAC work. Most of these items were approved by voice vote. One budget classification transfer request from the Commissioner of State Lands drew extended questioning and was ultimately not approved. Members questioned the $250,000 transfer to operating expenses tied to the purchase of a West Little Rock office building, the ongoing lease costs at the prior location, and whether the agency had adequately planned for building-related expenses. After discussion, the motion failed, and members told the agency to tighten spending and return if needed. The committee then took up 15 pay plan appropriation requests totaling $25.7 million and approved them after discussion with DFA, DHS, Corrections, and the State Board of Election Commissioners. Members focused heavily on DHS staffing shortages at human development centers, where officials said vacancies and turnover were driven by overtime and burnout rather than pay alone; one member asked DHS to submit a written plan to address the issue. Corrections reported the pay plan had improved hiring and retention. The committee also approved overtime appropriations for Emergency Management and Military. Reports on reserve funds, the Budget Stabilization Trust Fund, tobacco settlement, State Central Services, Education Adequacy, Medicaid Trust, IIJA, and revenue transfer activity were received. The Medicaid Trust Fund report prompted significant concern about February’s $90 million draw; DHS said the month was unusually high because of cash-flow timing and that the fund should end the year with a balance between $150 million and $200 million, while lawmakers noted a second $100 million set-aside is planned for FY27. The final discussion centered on DHS’s state hospital damage claim and reconstruction funding, where members expressed disappointment that insurance reimbursement would likely return only about $1.8 million now and possibly about $97,000 more later, far less than the roughly $5 million initially expected. DHS explained the policy was based on actual cash value and depreciation for old buildings, and said the work would proceed on Unit 3 for secured restoration because it was the most cost-effective option.

Summary: The subcommittee reviewed multiple methods of finance and construction items, including projects for Arkansas State University, Black River Technical College, UAMS, the University of Arkansas at Pine Bluff, and UCA. The UAPB Allied Health and Sciences Building appeared both as a method of finance and as an alternative delivery construction project, with East Harding Construction selected and AMR Architects as designer. Members approved the methods of finance, the alternative delivery project, and several discretionary grants, including Department of Health grants for a heart attack center designation and community health worker training, and DHS grants related to homeless services, behavioral health transition support, and an enabling technology pilot. The committee then reviewed service contracts, including RFQs, construction-related contracts, intergovernmental agreements, and a large number of out-of-state and in-state contracts. Testimony focused heavily on DHS staffing and state hospital contracts, the Arkansas State Police seatbelt survey, AEDC’s lithium supply chain analysis, and Shared Administrative Services’ new SuccessFactors performance-management contract. Members asked detailed questions about contract nursing costs, turnover, hiring timelines, and whether some contracts were being renewed or amended beyond their original projected costs. DHS and Veterans Affairs officials explained staffing shortages, retention incentives, and the use of contract labor as a supplement to state employees. Several contracts drew scrutiny and were held for further review. Representative Wardlaw raised concerns about projected costs and repeated amendments on the Department of Education security contract and on DHS staffing contracts, arguing that some had exceeded their original projected totals. The committee voted to hold contracts 5, 7, and 8 until Friday, while adopting the remaining contracts. The meeting ended after informational reports on service contract amendments without material change, executed contracts, and emergency procurements were presented, with no further business before adjournment.

Summary: The subcommittee met to review Department of Human Services hospital payments in Arkansas Medicaid, with DHS Secretary Janet Mann and Deputy Secretary Misty Eubanks presenting first, followed by Arkansas Hospital Association Executive Vice President Jody Ann Tritt and a brief comment from Arkansas Children’s. DHS outlined the main hospital payment streams: fee-for-service per diem payments, upper payment limit (UPL) supplemental payments, cost settlements, and smaller payments such as graduate medical education and disproportionate share hospital funds. Members asked for plain-language explanations of cost settlements, why per diem rates vary by hospital type, and why UPL applies to private hospitals. DHS said cost settlements and UPL are mechanisms to help offset Medicaid underpayment, with SFY 2025 hospital payments totaling hundreds of millions of dollars and no general revenue used for supplemental payments beyond the state share funded through hospital assessments and related financing structures. Committee members focused heavily on whether Arkansas hospitals are adequately reimbursed and why rural hospitals struggle. Tritt explained that critical access hospitals, rural emergency hospitals, PPS hospitals, and specialty hospitals operate under different federal and state rules, and said lower per diem rates for some facilities help with cash flow and later cost settlement adjustments. She said Arkansas hospitals are under financial strain, citing a negative patient services margin statewide and noting that Medicaid, Medicare, and commercial payers all contribute to the problem. She also said the association had just authorized a statewide survey of hospital finances and costs, which she expected would take about a year to complete. A major theme was commercial insurance reimbursement. Tritt argued Arkansas hospitals are paid far less than hospitals in neighboring states even though premiums are similar, and said administrative burdens, prior authorizations, and denials add to the problem. She said hospitals receive about 52 to 53 cents on the dollar for Medicaid costs without UPL and about 78 cents with UPL, still below cost. Members also discussed Medicare wage index issues, Medicare Advantage, and whether hospitals could use technology or alternative arrangements to improve finances. No votes were taken on the hospital presentation. At the end of the meeting, DHS provided a brief update on Living Choices and assisted living reimbursement. Officials said one assisted living facility, Pillars of the Community in Crossett, had announced closure, with nine waiver clients being transitioned to other settings. DHS said the current cost reporting period was underway and that a new rate study could be ready for review before the end of the fiscal year if reports were submitted on time. Members also asked about the broader waiver plan, and DHS said the next waiver iteration would likely be brought back to the committee in the summer.