Arkansas Issue 1, Transportation Sales Tax Continuation Amendment (2020)

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Arkansas Issue 1
Flag of Arkansas.png
Election date
November 3, 2020
Topic
Taxes and Transportation
Status
Approveda Approved
Type
Constitutional amendment
Origin
State legislature


Arkansas Issue 1, the Transportation Sales Tax Continuation Amendment, was on the ballot in Arkansas as a legislatively referred constitutional amendment on November 3, 2020.[1][2] It was approved.

A "yes" vote supported continuing a 0.5% sales tax, with revenue dedicated to state and local highways, roads, and bridges, that would otherwise expire in 2023.

A "no" vote opposed continuing the 0.5% sales tax, thereby allowing the tax to expire once bond debt authorized in 2012 is repaid in 2023.

Election results

Arkansas Issue 1

Result Votes Percentage

Approved Yes

660,018 55.33%
No 532,915 44.67%
Results are officially certified.
Source


Overview

What did Issue 1 do?

See also: Measure design

Issue 1 amended the state constitution to make permanent a 0.5% sales tax, authorized by Issue 1 of 2012, with revenue directed to state and local transportation, including highways, roads, and bridges. The sales tax was temporarily authorized by voters in 2012 and set to expire in 2023.

The sales tax could not be applied to food or food ingredients.

The Department of Finance and Administration estimated that the 0.5% sales tax authorized by the amendment would generate $293.7 million in revenue based on 12 months of collections. Issue 1 was designed to allocated in the following way:[3]

  • 70% ($205.59 million) to state highways,
  • 15% ($44.055 million) to county transportation, and
  • 15% ($44.055 million) to city transportation.

What was Issue 1 (2012)?

See also: Issue 1 of 2012 and the Connecting Arkansas Program

Voters authorized the temporary 0.5% sales tax that would be made permanent by this amendment in 2012 through approval of Issue 1 (2012), which is now Amendment 91 in the state constitution. The amendment was approved by a vote of 58% to 42%. Issue 1 authorized the 0.5% sales tax to be levied until the general obligation bonds in the amount of $1.3 billion for the construction of a four-lane highway were repaid (estimated to be in 2023).

Text of measure

Ballot title

The ballot title for Issue 1 (2020) is as follows:[2]

An Amendment to the Arkansas Constitution to continue a levy of a one-half percent sales and use tax for state highways and bridges; county roads, bridges, and other surface transportation; and city streets, bridges, and other surface transportation after the retirement of the bonds authorized in Arkansas Constitution, Amendment 91, as special revenue to be distributed under the Arkansas Highway Revenue Distribution Law.[4]

Ballot summary

The ballot summary (also called the Popular Name) of tIssue 1 is as follows:[2]

An Amendment to the Arkansas Constitution Continuing a One-Half Percent (0.5%) Sales and Use Tax for State Highways and Bridges; County Roads, Bridges and Other Surface Transportation; and City Streets, Bridges, and Other Surface Transportation After the Retirement of the Bonds Authorized in Arkansas Constitution, Amendment 91.[4]

Constitutional changes

See also: Amendments, Arkansas Constitution

Issue 1 added a new amendment to the state constitution. The following underlined text was added to the constitution:[2] Note: Use your mouse to scroll over the below text to see the full text.

§ 1. Intent of amendment.

(a) Arkansas Constitution, Amendment 91, levies a one-half percent sales and use tax to provide additional funding for the state's four-lane highway system, county roads, and city streets.

(b) The one-half percent sales and use tax under Arkansas Constitution, Amendment 91, shall be abolished when there are no bonds outstanding to which tax collections are pledged as provided in this amendment.

(c) Notwithstanding Arkansas Constitution, Amendment 91, § 8, it is the intent of this amendment that the sales and use tax levied under Arkansas Constitution, Amendment 91, continue after the retirement of the bonds authorized in Arkansas Constitution, Amendment 91, to provide special revenue for use of maintaining, repairing, and improving the state’s system of highways, county roads, and city streets.

§ 2. Excise tax.

(a)(1) Except for food and food ingredients, an additional excise tax of one-half percent (0.5%) is levied on all taxable sales of tangible personal property, specified digital products, a digital code, and services subject to the tax levied by the Arkansas Gross Receipts Act of 1941, Arkansas Code § 26-52-101 et seq.

(2) The tax shall be collected, reported, and paid in the same manner and at the same time as is prescribed by law for the collection, reporting, and payment of all other Arkansas gross receipts taxes.

(b)(1) Except for food and food ingredients, an additional excise tax of one-half percent (0.5%) is levied on all tangible personal property, specified digital products, a digital code, and services subject to the tax levied by the Arkansas Compensating Tax Act of 1949, Arkansas Code § 26-53- 101 et seq.

(2) The tax shall be collected, reported, and paid in the same manner and at the same time as is prescribed by law for the collection, reporting, and payment of Arkansas compensating taxes.

§ 3. Disposition of revenue.

(a) The revenue from the taxes levied under § 2 of this amendment shall be distributed to the State Highway and Transportation Department Fund, the County Aid Fund, and the Municipal Aid Fund in the percentages provided in sections § 27-70-201 and § 27-70-206 of the Arkansas Highway Revenue Distribution Law.

(b) No revenue derived from the taxes levied under § 2 of this amendment shall be used to secure bonds issued by the State Highway Commission.

§ 4. Effective date.

(a) If the Chief Fiscal Officer of the State determines that a written statement under Arkansas Constitution, Amendment 91, § 8(b), has been filed with the Chief Fiscal Officer of the State before June § 2 of this amendment shall be levied and collected on and after July 1, 2023.

(b) If a written statement under Arkansas Constitution, Amendment 91, § 8(b), has not been filed with the Chief Fiscal Officer of the State before June 1, 2023, the tax under § 2 of this amendment shall not be levied and collected until the first day of the first calendar quarter beginning more than thirty (30) days after a written statement under Arkansas Constitution, Amendment 91, § 8(b), is filed with the Chief Fiscal Officer of the State. [4]

Readability score

See also: Ballot measure readability scores, 2020
Using the Flesch-Kincaid Grade Level (FKGL and Flesch Reading Ease (FRE) formulas, Ballotpedia scored the readability of the ballot title and summary for this measure. Readability scores are designed to indicate the reading difficulty of text. The Flesch-Kincaid formulas account for the number of words, syllables, and sentences in a text; they do not account for the difficulty of the ideas in the text. The state legisalture wrote the ballot language for this measure.


The FKGL for the ballot title is grade level 31, and the FRE is 113. The word count for the ballot title is 62, and the estimated reading time is 16 seconds. The FKGL for the ballot summary is grade level 24, and the FRE is 8. The word count for the ballot summary is 46, and the estimated reading time is 12 seconds.


Support

VoteForRoads.JPG

Vote for Roads. Vote for Issue 1. led the campaign in support of the amendment.

Supporters

The amendment was sponsored by Rep. Jeff Wardlaw (R) as House Joint Resolution 1018.

Officials

Organizations

  • Arkansas State Chamber of Commerce


Arguments

  • Arkansas Governor Asa Hutchinson (R): "It will provide better roads for the parent who puts their child on the school bus and worries about them getting to school safely; the farmer who wants to get his product to market; and the businessperson who is concerned about the potholes and the cost of repair for his vehicle… Every study that his been done shows that we do not have enough money in Arkansas currently to maintain our existing roads. This is about fulfilling the need that we have… for roads."
  • Vote for Roads: "Issue 1 will support 3,600+ jobs EVERY year and provide $8.2 billion of economic activity over 10 years. Every single city & county will receive funding for ROADS so EVERY Arkansan will benefit. Issue 1 will improve 7,000 miles of roads and repair dangerous bridges, making sure our most precious cargo arrives safely. Issue 1 will accomplish all of this WITHOUT raising taxes!"
  • Arkansas Attorney General Leslie Rutledge: "There will be detractors and opposition who say we don’t need any new taxes. Well, it isn’t a new tax, it’s an extension of a tax, one that is much needed for infrastructure. It isn’t a partisan issue."
  • Terry Norman of Norman Transportation: "I am in the trucking business… and would like to add that safety is the utmost concern in the trucking industry. The key to that is good roads… Every bit of funding we can get for our highways is important and I know our truckers will appreciate it."


Opposition

Vote-no--1540xauto.jpg

Vote No on Issue 1, No Permanent Sales Tax led the campaign in opposition to the Issue 1.[5]

The amendment received 30 no votes in the House and seven no votes in the Senate. Click here to see vote totals by party.

Opponents

Organizations

  • Americans for Prosperity
  • Americans for Tax Reform
  • Arkansas Community Organizations
  • Audubon Arkansas
  • Central Arkansas Sierra Club
  • Downton Little Rock Neighborhood Association
  • Garland County Tea Party
  • Northeast Arkansas Tea Party


Arguments

  • Vote No on Issue 1, No Permanent Sales Tax: "Our state already has the second-highest sales tax rate in the country. With families and businesses struggling, Arkansas simply can’t afford a $293 million annual tax increase. Voting NO on Issue 1 will help reduce the burden on hardworking families and allow Arkansans to keep more of their hard-earned money! 1. A PERMANENT SALES TAX INCREASE: This sales tax increase will become part of the state constitution. We’ll pay this tax FOREVER! 2. NO ACCOUNTABILITY: ArDOT gets the funds directly — no taxpayer or elected official control. Who knows how they’ll spend the money? 3. NOT NEEDED: In this time of crisis, health care and education are more important than building new roads. We’ve got bigger priorities, especially now."


Campaign finance

See also: Campaign finance requirements for Arkansas ballot measures
The campaign finance information on this page reflects the most recently scheduled reports processed by Ballotpedia, which covered through November 30, 2020.


Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
Support $2,296,800.54 $7,291.56 $2,304,092.10 $2,286,176.12 $2,293,467.68
Oppose $0.00 $0.00 $0.00 $0.00 $0.00

Ballotpedia identified one committee registered to support the amendment: Vote for Roads. Vote for Issue 1. The committee reported $2.3 million in contributions and $2.29 million in expenditures. The largest donors were Jim Walton, Alice Walton, JB Hunt, and Tyson Foods, Inc., which each gave $100,000. Tyson Foods, Inc. also gave $3,600 in in-kind contributions.

Ballotpedia identified one committee registered to oppose the amendment: No Permanent Tax. No On Issue 1. The committee had not reported campaign finance activity.[6]

Support

The following table includes contribution and expenditure totals for the committee in support of the amendment.[6]

Committees in support of Issue 1
Committee Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
Vote for Roads. Vote for Issue 1. $2,296,800.54 $7,291.56 $2,304,092.10 $2,286,176.12 $2,293,467.68
Total $2,296,800.54 $7,291.56 $2,304,092.10 $2,286,176.12 $2,293,467.68

Donors

The following were the donors who contributed $50,000 or more to the support committee.[6]

Donor Cash Contributions In-Kind Contributions Total Contributions
Jim Walton $100,000.00 $3,600.00 $103,600.00
Alice Walton $100,000.00 $0.00 $100,000.00
JB Hunt $100,000.00 $0.00 $100,000.00
Tyson Foods, Inc $100,000.00 $0.00 $100,000.00
McGeorge Contracting Co., Inc. $63,000.00 $0.00 $63,000.00

Methodology

To read Ballotpedia's methodology for covering ballot measure campaign finance information, click here.

Polls

See also: Ballotpedia's approach to covering polls and 2020 ballot measure polls

In an October 2020 poll by Talk Business & Politics and Hendrix College, 647 likely voters were asked the following question:[7]

Thinking about the November election, there will be a proposed amendment to the Arkansas Constitution on the ballot regarding highway funding, known as Issue 1. Issue 1 would continue a levy of a one-half percent sales and use tax for state highways and bridges; county roads, bridges, and other surface transportation; and city streets, bridges, and other surface transportation. If the election were being held today, would you vote for or against Issue 1?[4]

Poll results are shown below:

Arkansas Issue 1
Poll Support OpposeUndecidedMargin of errorSample size
Talk Business & Politics and Hendrix College poll
10/11/20 - 10/13/20
59.0%31.0%10.0%+/-4.9647
Note: The polls above may not reflect all polls that have been conducted in this race. Those displayed are a random sampling chosen by Ballotpedia staff. If you would like to nominate another poll for inclusion in the table, send an email to editor@ballotpedia.org.


Background

Issue 1 of 2012 and the Connecting Arkansas Program

See also: Arkansas Sales Tax Increase Amendment, Issue 1 (2012)

The Arkansas Sales Tax Increase Question, also known as Issue 1, was a legislatively referred constitutional amendment on the November 6, 2012 statewide ballot in the state of Arkansas, where it was approved. The measure implemented a half-percent sales tax in the state. The revenue generated from the tax was used to fund the Connecting Arkansas Program (CAP).[8] As of June 2019, 13 projects totaling $532.6 million had been completed, nine projects totaling $525.9 million were under construction, and 14 projects were scheduled for construction. The status of the 36 CAP projects may be found here.

Arkansas Issue 1 (2012)
ResultVotesPercentage
Approveda Yes 592,980 58.21%
No425,73341.79%

Highway Funding in Arkansas

The tax continuation amendment is part of what Arkansas Governor Asa Hutchinson (R) called "the largest highway plan in the state's history." The other part of the highway funding plan is Act 416 of 2019.[9]

Act 416 of 2019 (Senate Bill 336)

Act 416 (Senate Bill 336) was designed "to provide additional revenue for the maintenance and repair of highways, streets, and bridges in the state." The bill was passed in the State Senate (27-8) on February 21, 2019. The bill was passed in the House (71-26) with amendments on March 4, 2019. The Senate concurred with the House's amendments on March 5, 2019. It was signed into law by Arkansas Governor Asa Hutchinson (R) on March 12, 2019.

Act 416 established a new wholesale tax on fuel that was expected to raise gas prices by 3 cents a gallon and diesel by 6 cents. The bill was also designed to increase gasoline taxes to 24.5 cents per gallon and diesel taxes to 28.5 cents per gallon. The bill also imposed an additional annual registration fee of $100 dollars on hybrid vehicles and $200 dollars on electric vehicles.[10][9]

Referred amendments on the ballot

From 1996 through 2018, the state legislature referred 28 constitutional amendments to the ballot. Voters approved 22 and rejected six of the referred amendments. All of the amendments were referred to the ballot for general elections during even-numbered election years. The average number of amendments appearing on the general election ballot was between two and three. The approval rate at the ballot box was 78.57 percent during the 20-year period from 1996 through 2018. The rejection rate was 21.43 percent.

Legislatively-referred constitutional amendments, 1996-2018
Total number Approved Percent approved Defeated Percent defeated Annual average Annual median Annual minimum Annual maximum
28 22 78.57% 6 21.43% 2.33 2.50 1 3

Tax policies on the ballot in 2020

See also: Taxes on the ballot

In 2020, voters in 14 states voted on 21 ballot measures addressing tax-related policies. Ten of the measures addressed taxes on properties, three were related to income tax rates, two addressed tobacco taxes, one addressed business-related taxes, one addressed sales tax rates, one addressed fees and surcharges, and one was related to tax-increment financing (TIF).

Click Show to read details about the tax-related measures on statewide ballots in 2020.

Path to the ballot

See also: Amending the Arkansas Constitution

To put a legislatively referred constitutional amendment before voters, a simple majority vote is required in both the Arkansas State Senate and the Arkansas House of Representatives.

The amendment was sponsored by Rep. Jeff Wardlaw (R) as House Joint Resolution 1018. The state House approved the amendment 67-30 with three not voting on March 4, 2019. The state Senate approved the amendment 25-7 with three not voting on March 7, 2019, certifying it to appear on the November 2020 ballot. In the House, 45 Republicans and 22 Democrats voted in favor of HJR 1018. Twenty-nine Republicans and one Democrat, Rep. John Walker, voted against HJR 1018. In the Senate, 17 Republicans and eight Democrats voted in favor of HJR 1018. Seven Republicans and zero Democrats voted against it.[1]

Vote in the Arkansas House of Representatives
March 4, 2019
Requirement: Simple majority vote of all members in each chamber
Number of yes votes required: 51  Approveda
YesNoNot voting
Total67303
Total percent67.0%30.0%3.0%
Democrat2211
Republican45292

Vote in the Arkansas State Senate
March 7, 2019
Requirement: Simple majority vote of all members in each chamber
Number of yes votes required: 18  Approveda
YesNoNot voting
Total2573
Total percent71.4%20.0%8.6%
Democrat801
Republican1772


How to cast a vote

See also: Voting in Arkansas

Click "Show" to learn more about voter registration, identification requirements, and poll times in Arkansas.

See also

External links

Support

Opposition

Footnotes

  1. 1.0 1.1 Arkansas State Legislature, "House Joint Resolution 1018," accessed March 7, 2019
  2. 2.0 2.1 2.2 2.3 Arkansas Legislature, "Full Text of House Joint Resolution 1018," accessed March 7, 2019
  3. Arkansas State Legislature, "Department of Finance and Administration HJR 1018 impact statement," accessed February 27, 2020
  4. 4.0 4.1 4.2 4.3 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source. Cite error: Invalid <ref> tag; name "quotedisclaimer" defined multiple times with different content Cite error: Invalid <ref> tag; name "quotedisclaimer" defined multiple times with different content
  5. Americans for Prosperity, "No Permanent Tax," accessed October 1, 2020
  6. 6.0 6.1 6.2 Arkansas Ethics Commission, "Filings," accessed August 18, 2020
  7. Talk Business & Politics, "Poll: Highway funding proposal Issue 1 poised to pass," accessed October 21, 2020
  8. Connecting Arkansas Program, "Overview," accessed June 20, 2019
  9. 9.0 9.1 UA Little Rock Public Radio, "Arkansas Governor Signs $95 Million Highway Funding Bill Into Law," accessed March 25, 2019
  10. KTVE News, "Arkansas highway bill to impose tax on hybrid and electric cars," accessed March 25, 2019
  11. Arizona Secretary of State, "Initiative 31-2020," February 14, 2020
  12. Colorado Secretary of State, "2019-2020 Initiative Filings, Agendas & Results," accessed April 17, 2020
  13. Illinois State Legislature, "Senate Joint Resolution Constitutional Amendment 1," accessed May 2, 2019
  14. Illinois State Board of Elections,"Committee Search," accessed May 28, 2019
  15. Alaska Division of Elections, "Alaska's Fair Share Act," accessed January 13, 2020
  16. Anchorage Daily News, "Group says it has enough signatures to put Alaska oil tax initiative on ballot," January 14, 2020
  17. APOC, "Online Reports," accessed January 7, 2020
  18. Nebraska Secretary of State, "Initiative Petition text," accessed August 22, 2019
  19. California Attorney General, "Initiative 19-0008," September 17, 2019
  20. California the Legislative Analyst's Office, "A.G. File No. 2019-0008," February 5, 2018
  21. California State Legislature, "Assembly Concurrent Resolution 11," accessed May 8, 2019
  22. Colorado General Assembly, "SCR 20-001," accessed June 10, 2020
  23. Arkansas State Legislature, "House Joint Resolution 1018," accessed March 7, 2019
  24. UA Little Rock Public Radio, "Arkansas Governor Signs $95 Million Highway Funding Bill Into Law," accessed March 25, 2019
  25. Arkansas Ethics Commission, "Filings," accessed August 18, 2020
  26. Colorado State Legislature, "House Bill 20-1427," accessed June 15, 2020
  27. Oregon State Legislature, "HB 2270," accessed June 25, 2019
  28. Colorado Secretary of State, "2019-2020 Initiative Filings, Agendas & Results," accessed February 10, 2020
  29. Nebraska State Legislature, "LR14CA," accessed April 5, 2019
  30. Arkansas Code, "Title 7, Chapter 5, Subchapter 43," accessed April 3, 2023
  31. 31.0 31.1 Arkansas Secretary of State, "Voter Registration Information," accessed April 5, 2023
  32. 32.0 32.1 32.2 Arkansas Secretary of State, "A Pocket Guide to Voting in the Natural State," accessed April 3, 2023