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Gov. Sarah Sanders gears up for second year

Gov. Sarah Sanders is working with lawmakers on tax cuts that could be enacted, during the 2024 fiscal session. Last year, lawmakers lowered the income tax and the corporate tax.
Talk Business & Politics
Gov. Sarah Sanders is working with lawmakers on tax cuts that could be enacted, during the 2024 fiscal session. Last year, lawmakers lowered the income tax and the corporate tax.

Arkansas Gov. Sarah Sanders achieved major legislative goals in her first year in office, and she had her fair share of controversies. In year two, she plans to build on tax cuts and education policy while pursuing the rest of her public safety agenda after litigation is settled.

Appearing on this week’s edition of Capitol View and Talk Business & Politics, Sanders said she’s not sure of the size of potential tax cuts that could be considered in the upcoming fiscal session, but she predicted they would be smaller than the ones enacted in her first year.

“I wish I got to wave a magic wand and make those decisions all by myself, but I do have to work with the legislature on what that looks like,” she said. “I’m hopeful that we’ll be able to get close to what we did this past year. I don’t know if it’ll be quite as big as both of the tax cuts from last year, but I’m certainly confident we’ll be able to do something… we’re going to continue to chip away at that income tax as much as possible until hopefully and ultimately we get to zero.”

In the 2023 regular legislative session and a subsequent special session, the governor and lawmakers lowered the individual income tax rate from 4.9% to 4.4% and the corporate income tax rate from 5.3% to 4.8%.

Sanders also passed her signature education plan – the LEARNS Act – during her first session. The comprehensive education bill raised starting teacher pay to $50,000, adding literacy programs and assistance, enhanced school safety funding, and enacted a voucher program called “education freedom accounts.”

The governor thinks for now the rulemaking process and implementing LEARNS will continue without any big changes.

“I feel really comfortable with where we are. I do think that there will be some gradual rule adjustments that take place over the next couple of years, but there’s nothing specific that I think that we have to tweak just yet,” she said.

The education freedom accounts, which allow for public school fund for students to follow them to private and parochial school settings, are limited in the first two years of LEARNS. In year three, they become universal, which will bring a larger projected price tag.

While Sanders said there were projections on those costs, the numbers for years three and beyond have been elusive. The Department of Finance and Administration only publicly provided a fiscal impact statement for the first two years of LEARNS when the legislation was debated in session.

“We did a forecast out and that was something that was really important to a number of the legislators as well as our team was looking at what year three, four or five all the way through year 10 and what that looked like based off of historical data in places that had implemented universal choice. I feel pretty comfortable that we’ve allocated and set money aside and we’ll continue monitoring that as the program grows. But right now, I feel like we are in a good place with the budget for the money that we’ve set aside and allocated based on forecast from our team prior to the legislation even passing,” Sanders said.

In recent months, Sanders has been embroiled in two controversies. One involved her office’s initial purchase of a $19,000 lectern later reimbursed to the state by the Republican Party of Arkansas. Sanders said her team “followed every rule and protocol” and wouldn’t have done much different “at this point.” A legislative audit of the purchase is ongoing and is expected to be public in the next 60 days.

The governor was successful in the regular session passing a new expansive public safety law called the Protect Act. It lengthens sentences for violent offenders, increased funding for mental health services and specialty courts, and aimed to create more prison bed space for an overcrowded corrections system.

In December, the governor and the state Board of Corrections accelerated a feud over funding prison bed expansions at existing facilities. With litigation pending, the board fired Sanders’ pick to lead the Corrections Department, Joe Profiri. He is now joining her staff as a senior advisor and will advise on corrections policy while the lawsuits play out.

When asked why she didn’t try to hammer out a compromise on prison bed expansions more privately, Sanders said the adversarial relationship with the Board of Corrections has been problematic since the early days of her tenure.

“This is a group that’s frankly fought us kind of every step of the way. They were against us on the Protect Act. We requested an expansion for beds. Every single thing we’re doing, we’re looking for how do we do a better job protecting the people of Arkansas. And they fought us every step of the way and kind of kicked off a little bit of an adversarial relationship,” she said.

The Board of Corrections, which has independent autonomy due to Amendment 33, claims it has to vet proposals from the governor and has the authority to hire and fire the corrections chief. Several lawsuits testing those limits are in process.

“I’m confident that the Attorney General and his team will be successful in litigation at the court side and will hopefully have Secretary Profiri back in place and we’ll continue moving forward with policies that actually help protect people,” she added.

Sanders weighed in on her recent endorsement of former President Donald Trump, the frontrunner for the GOP Presidential nomination. You can watch her full interview in the video below.

This story comes from the staff of Talk Business & Politics, a content partner with KUAR News. You can hear the weekly program on Mondays at 6:06 p.m.