State Tax Policy
4:11 pm
Tue February 26, 2013

Committee Amends And Advances Spending Cap Bill

Ark. House Majority Leader Bruce Westerman (R-Hot Springs) said Tuesday, his bill to cap state spending could improve the state's existing budgeting process.
Credit Nathan Vandiver / KUAR

A bill that promises to reign in state government growth advanced out of committee Tuesday, for the second time.

House Majority Leader Bruce Westerman, a Republican from Hot Springs, amended his bill that would cap state spending by tying the cap to the average rate of disposable personal income in the state, or how much money the average Arkansan has after paying taxes.

“I believe this is a great indicator,” he said.

Westerman says the bill is needed to have a complete tax reform package.

“I think this will allow us to responsibly control the growth of government spending, it’s a much simpler method of doing the calculation,” the House Majority leader told the committee.

Westerman says tying the cap to disposable income gives the state incentive to reduce taxes.

The bill originally capped growth in the state budget at 3 percent, or the state’s average gross domestic product for the three previous years.

The bill already passed the committee but came back after an amendment failed on the House floor.

The Governor, who told reporters he hadn’t yet read the amendment, told reporters the state already has a good budgeting process.