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1 State of Arkansas A Bill
2 95th General Assembly
3 Regular Session, 2025 SENATE BILL 636
4
5 By: Senator J. Dismang
6 By: Representative Jean
7
8 For An Act To Be Entitled
9 AN ACT TO TRANSFER FUNDS; DEFINE THE MONIES TO BE
10 AVAILABLE IN THE RESTRICTED RESERVE FUND; AND TO
11 ALLOW THAT ADDITIONAL FUNDS MAY BE MADE AVAILABLE FOR
12 STATE DEPARTMENTS, AGENCIES, AND INSTITUTIONS; TO
13 DECLARE AN EMERGENCY; AND FOR OTHER PURPOSES.
14
15
16 Subtitle
17 AN ACT TO TRANSFER FUNDS; DEFINE THE
18 MONIES TO BE AVAILABLE IN THE RESTRICTED
19 RESERVE FUND; AND ALLOW ADDITIONAL FUNDS
20 TO BE MADE AVAILABLE FOR STATE
21 DEPARTMENTS, AGENCIES AND INSTITUTIONS;
22 AND TO DECLARE AND EMERGENCY.
23
24 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:
25
26 SECTION 1. DO NOT CODIFY. Legislative findings -- Nonseverability.
27 (a) The General Assembly finds that:
28 (1) Determining the maximum amount of appropriation and funding
29 for a state agency or institution each fiscal year is the prerogative of the
30 General Assembly;
31 (2) Determining the maximum amount of appropriation and funding
32 for a state agency or institution is usually accomplished by delineating the
33 maximum amounts in the appropriation acts for the state agency or
34 institution, authorizing the distribution of unobligated funds, and in the
35 general revenue allocations authorized for each relevant fund and fund
36 account by amendment to the Revenue Stabilization Law, � 19-5-101 et seq.;
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1 (3) The Restricted Reserve Fund has established procedures for
2 the transfer of funds to various funds and fund accounts for the efficient
3 and effective operation of state government; and
4 (4) It is necessary and appropriate that the General Assembly
5 maintain oversight by requiring prior approval of the Legislative Council or,
6 if the General Assembly is in session, the Joint Budget Committee, as
7 provided in � 19-5-1263(c).
8 (b) The requirement of approval by the Legislative Council or if the
9 General Assembly is in session the Joint Budget Committee, is not a severable
10 part of � 19-5-1263. If the requirement of approval by the Legislative
11 Council or if the General Assembly is in session the Joint Budget Committee,
12 is ruled unconstitutional by a court of competent jurisdiction, � 19-5-1263
13 (c)(d) and (e) are void in their entirety.
14
15 SECTION 2. DO NOT CODIFY. TRANSFERS TO THE RESTRICTED RESERVE FUND.
16 Immediately upon the effective date of this Act, as soon thereafter as is
17 practical or as authorized in this Section the State Treasurer shall transfer
18 and credit to the "Restricted Reserve Fund", upon certification of the
19 amounts thereof by the Chief Fiscal Officer of the State, the following:
20 (a)(1) All unobligated monies in the EBD or Contingency Set-Aside in the
21 Restricted Reserve Fund as established in Section 3(a)(19) of Act 561 of
22 2023;
23 (2) All unobligated monies in the Adequacy Set-Aside in the
24 Restricted Reserve Fund as established in Section 3(b)(3) of Act 561 of 2023;
25 (3) All unobligated monies in the Infrastructure Investment and Jobs
26 Act Grants Matching Set-Aside as established in Section 3(a)(4) of Act 561 of
27 2023; and
28 (4) All unobligated monies in the Law Enforcement Stipends Set-Aside
29 in the Restricted Reserve Fund as established in Section 3(a)(27);
30 (b) All unobligated and unallocated monies remaining in the
31 "Development and Enhancement Fund" on June 30, 2025 which are not required to
32 finance projects to be financed therefrom pursuant to appropriations enacted
33 by the General Assembly, or which have not been reappropriated or reallocated
34 for financing from the "Development and Enhancement Fund" by the 95th General
35 Assembly;
36 (c)(1) All General Revenue Funds recovered from remaining fund balances
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1 in the "General Revenue Allotment Reserve Fund" from monies accruing thereto
2 during the 2023-2024 fiscal year which are not required to finance enactments
3 of the 95th General Assembly that do not expire on June 30, 2024, including
4 all General Revenue Funds recovered from remaining fund balances;
5 (2) Any unobligated or unallocated funds remaining on July 2, 2025 in
6 the "General Revenue Allotment Reserve Fund" which are not required to
7 finance enactments of the 95th General Assembly that do not expire on June
8 30, 2025, including all General Revenue Funds recovered from remaining fund
9 balances;
10 (3) All General Revenue Funds recovered from remaining fund balances
11 in the "General Revenue Allotment Reserve Fund" which are not required to
12 finance enactments of the 95th General Assembly that do not expire on June
13 30, 2026, including all General Revenue Funds recovered from remaining fund
14 balances;
15 (d) Those special revenues credited to the Development and Enhancement
16 Fund from estate taxes as set out in Arkansas Code � 19-6-301(171); and
17 (e) Other revenues as may be transferred or authorized by law.
18
19 SECTION 3. DO NOT CODIFY. TRANSFERS, RESTRICTED RESERVE FUND
20 DISTRIBUTION AND SET-ASIDES. After having made transfers as authorized in
21 this Act, and after having transferred or set-aside the obligations as set
22 out in �19-5-202(b)(2)(B)(iii) as determined by the Chief Fiscal Officer of
23 the State, for those funds transferred and credited to the Restricted Reserve
24 Fund as authorized in Section 2 of this Act, and that are unobligated for
25 other Set-Asides established by the General Assembly, the State Treasurer
26 shall transfer funds or establish sub-fund set-asides, or transfer funds to
27 existing sub-fund set-asides in the Restricted Reserve Fund, referred to and
28 established as "Set-Asides" in the Restrict Reserve fund herein, which shall
29 be funded as funds are available:
30 (a) Set-Aside four hundred thirty-six million seven hundred ninety-four
31 thousand four hundred thirty-three dollars ($436,794,433) or so much as is
32 available for the "Restricted Reserve Fund Set-Asides" as enumerated in
33 subsections (a)(2) through (a)(12) of this section, not inclusive of funds
34 authorized in subsection (a)(1) that is to be transferred effective upon
35 passage and approval of this Act, for purpose as set out in each Set-Aside,
36 to be funded in the following order;
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1 (1) For a fund transfer upon the effective date of this subsection, the
2 Chief Fiscal Officer of the State shall transfer on his or her books and
3 those of the State Treasurer and the Auditor of the State the sum of one
4 hundred and thirty-six million dollars ($136,000,000) from the General
5 Revenue Allotment Reserve Fund to the State Captive Insurance Program Trust
6 Fund;
7 (2) Medicaid Sustainability Set-Aside, for the Department of Human
8 Services for transfers from time to time as determined by the Chief Fiscal
9 Officer of the State for Medicaid Expenses, as authorized in 19-5-1263 (c),
10 in a sum not to exceed $100,000,000;
11 (3) Children's Educational Freedom Account Set-Aside, for the Department
12 of Education - Division of Elementary and Secondary Education, for transfers
13 from time to time to the Arkansas Children's Educational Freedom Account
14 Fund, as authorized in 19-5-1263 (c), in a sum not to exceed $90,000,000;
15 (4)(A) Various General Discretionary Majority Vote Set-Aside, for
16 transfers from time to time as determined by the Chief Fiscal Officer of the
17 State, in a sum not to exceed $45,994,433;
18 (B) Funds transferred to the Various General Discretionary Majority
19 Vote Set-Aside herein shall be in addition to those remaining balances
20 currently available as established in Section 3(a)(18) of Act 561 of 2023 and
21 any other funds made available by the General Assembly;
22 (C) Notwithstanding other provisions of law as set out in 19-5-1263(c)
23 the Various General Discretionary Majority Vote Set-Aside authorized in
24 subsections (a)(4) herein shall only require a majority affirmative vote as
25 set out in the rules of the Legislative Council or the Joint Budget Committee
26 during a legislative session of the General Assembly for prior approval of
27 all disbursements;
28 (5)(A) Educational Facilities Set-Aside, for the Department of Education -
29 Division of Public School Academic Facilities and Transportation, Educational
30 Facilities Partnership Fund Account, Academic Facilities Partnership Program,
31 as authorized in 19-5-1263 (c), in a sum not to exceed $45,000,000;
32 (B) Funds transferred to the Educational Facilities Set-Aside herein
33 shall be in addition to those remaining balances currently available as
34 established in Section 3(a)(1) of Act 561 of 2023 and any other funds made
35 available by the General Assembly;
36 (C) All funds held in the Educational Facilities Set-Aside in the
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1 Restricted Reserve Fund shall be invested and reinvested at the direction of
2 the State Board of Finance to maximize returns using any investments
3 authorized for use by the Treasurer of State; and Interest Earnings or other
4 earnings on moneys in the fund shall be allocated and retained in addition to
5 existing balances in the Educational Facilities Set-Aside;
6 (6)(A) Teacher Academy Scholarship Set-Aside, for the Department of
7 Education - Division of Higher Education, for transfers from time to time for
8 the Arkansas Teacher Academy Scholarship Program Fund, as authorized in 19-5-
9 1263 (c), in a sum not to exceed $12,000,000;
10 (B) Funds transferred to the Teacher Academy Scholarship Set-Aside
11 herein shall be in addition to those remaining balances currently available
12 as established in Sections 3(a)(8) and 3(b)(4) of Act 561 of 2023 and any
13 other funds made available by the General Assembly;
14 (7)(A) Motor Vehicle Set-Aside, for transfers from time to time as
15 determined by the Chief Fiscal Officer of the State, as authorized in 19-5-
16 1263 (c), in a sum not to exceed $4,700,000;
17 (B) Funds transferred to the Motor Vehicle Set-Aside herein shall be in
18 addition to those remaining balances currently available as established in
19 Sections 3(a)(9) of Act 561 of 2023 and any other funds made available by the
20 General Assembly;
21 (8) Economic Stimulus Programs Set-Aside, for transfers from time to time
22 to the Department of Commerce - Arkansas Economic Development Commission to
23 fund or fund accounts as determined by the Chief Fiscal Officer of the State
24 for Site Infrastructure Grants and Economic Stimulus Activities throughout
25 the state, as authorized in 19-5-1263 (c), in a sum not to exceed
26 $50,000,000;
27 (9) Arkansas School for the Deaf/Blind Set-Aside, for transfers from time
28 to time as determined by the Chief Fiscal Officer of the State, as authorized
29 in 19-5-1263 (c), in a sum not to exceed $35,000,000;
30 (10) State Capitol HVAC Upgrade Set-Aside, for the Secretary of State, for
31 transfers from time to time as determined by the Chief Fiscal Officer of the
32 State, as authorized in 19-5-1263 (c), in a sum not to exceed $9,100,000;
33 (11) For a transfer upon the effective date of this subsection, the Chief
34 Fiscal Officer of the State shall transfer on his or her books and those of
35 the State Treasurer and the Auditor of the State the sum of twenty-five
36 million dollars ($25,000,000) to the Economic Development Incentive Quick
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1 Action Closing Fund, for the Department of Commerce � Arkansas Economic
2 Development Commission; and
3 (12) For a transfer upon the effective date of this subsection, the Chief
4 Fiscal Officer of the State shall transfer on his or her books and those of
5 the State Treasurer and the Auditor of the State the sum of twenty million
6 dollars ($20,000,000) to the Arkansas Major Historic Rehabilitation Trust
7 Fund, for the Department of Parks, Heritage, and Tourism - Division of
8 Arkansas Heritage.
9 (b) After all the disbursements, transfers, or funds deposited in Restricted
10 Reserve Fund Set-Aside sub-funds as authorized in this Act, other enactments
11 by the General Assembly for Restricted Reserve Fund Set-Asides or transfers
12 out of the Restricted Reserve Fund to Fund or Fund Accounts are completed,
13 any remaining unobligated balances, future collections, deposits, and
14 transfers authorized in Section 2 of this Act shall be transferred and
15 credited to the General Revenue Allotment Reserve Fund.
16
17 SECTION 4. Arkansas Code � 19-5-905(a)(12), concerning the uses of the
18 Securities Reserve Fund, is amended to read as follows:
19 (12) After all distributions and transfers under this section,
20 less one hundred thousand dollars ($100,000) under � 19-3-521(a)(2), for a
21 transfer by the Chief Fiscal Officer of the State on the last business day of
22 the fiscal year for that fiscal year of the fund balances to the Catastrophic
23 Reserve Fund shall be held in a sub-fund as necessary to be distributed as
24 follows:
25 (A) On September 1, 2025:
26 (i) After any other transfers authorized by the
27 General Assembly, the lesser of the remaining fund balance or twenty-five
28 million dollars ($25,000,000) to the Water and Sewer Treatment Facilities
29 Grant Program Fund; and
30 (ii) Any remaining fund balance after the transfer
31 under subdivision (a)(12)(A)(i) of this section to the General Revenue
32 Allotment Reserve Fund;
33 (B) On July 2, 2026:
34 (i) After any other transfers authorized by the
35 General Assembly, the lesser of the remaining fund balance or twenty-five
36 million dollars ($25,000,000) to the Water and Sewer Treatment Facilities
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1 Grant Program Fund; and
2 (ii) Any remaining fund balance after the transfer
3 under subdivision (a)(12)(B)(i) of this section to the General Revenue
4 Allotment Reserve Fund; and
5 (C) On July 1, 2027:
6 (i) After any other transfers authorized by the
7 General Assembly, the lesser of the remaining fund balance or twenty-five
8 million dollars ($25,000,000) to the Water and Sewer Treatment Facilities
9 Grant Program Fund; and
10 (ii) Any remaining fund balance after the transfer
11 under subdivision (a)(12)(C)(i) of this section to the General Revenue
12 Allotment Reserve Fund; and
13 (D) For fiscal years beginning on or after July 1, 2028,
14 on the last business day of the fiscal year the remaining fund balance to the
15 General Revenue Allotment Reserve Fund.
16
17 SECTION 5. DO NOT CODIFY. Conditions and Audit. (a) Transfer of funds
18 from the "Restricted Reserve Fund" shall be made only after the Chief Fiscal
19 Officer of the State has determined that all criteria or pre-conditions
20 established in the appropriation act to receive the transfer have been met
21 and that a Method of Finance has been filed with the Office of Accounting in
22 the Department of Finance and Administration, if required.
23 (b) Any matching funds as may be provided in law shall be certified to
24 the Chief Fiscal Officer of the State prior to the commencement of the
25 project.
26 (c) Any recipient of the funds appropriated herein are also subject to
27 an audit by the Arkansas Legislative Audit of the Legislative Joint Auditing
28 Committee in order to determine that the use of the funds was in compliance
29 with the intent and appropriated purposes of the General Assembly.
30
31 SECTION 6. DO NOT CODIFY. Funding Authority. (a) Any enactment of the
32 95th General Assembly in either regular, fiscal or extraordinary session
33 appropriating, transferring or allocating funds to the "Restricted Reserve
34 Fund" may be deemed to be payable from the "Restricted Reserve Fund".
35 (b) Appropriations which are not enumerated in this Act may be
36 financed from monies accruing to the "Restricted Reserve Fund" to fund
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1 appropriations authorized by the General Assembly and as set out in law.
2
3 SECTION 7. EMERGENCY CLAUSE. It is found and determined by the General
4 Assembly, that the Constitution of the State of Arkansas prohibits the
5 appropriation of funds for more than a one (1) year period; that the
6 effectiveness of this Act on July 1, 2025 is essential to allow transfers
7 which can provide an additional funding mechanism for the operation of state
8 departments, agencies and institutions of higher education, as well as to
9 address unforeseen needs of the state through the disbursement of state funds
10 with the Restricted Reserve Fund as authorized in this Act; with the
11 exception that Section 3 Subsection (a)(1) and Section 4 in this Act shall be
12 in full force and effect from and after the date of its passage and approval,
13 and that in the event of an extension of the Regular Session, the delay in
14 the effective date of this Act beyond July 1, 2025, with the exception that
15 Section 3 Subsection (a)(1) and Section 4 in this Act shall be in full force
16 and effect from and after the date of its passage and approval, could work
17 irreparable harm upon the proper the proper transfer of funds, administration
18 and provision of essential governmental programs. Therefore, an emergency is
19 hereby declared to exist and this Act being necessary for the immediate
20 preservation of the public peace, health and safety shall be in full force
21 and effect from and after July 1, 2025; with the exception that Section 3
22 Subsection (a)(1) and Section 4 in this Act shall be in full force and effect
23 from and after the date of its passage and approval.
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