Arkansas Removal of Cap on State-Issued Bonds, Issue 3 (2016)

Arkansas Issue 3
Election date November 8, 2016
Topic Bond issues
Status a Approved
Type Constitutional amendment	Origin State legislature

2016 measures
November 8
Issue 1 a
Issue 2 a
Issue 3 a
Issue 6 a
Polls
Voter guides
Campaign finance
Signature costs

The Arkansas Removal of Cap on State-Issued Bonds Amendment, also known as Issue 3, was on the November 8, 2016 ballot in Arkansas as a legislatively referred constitutional amendment. It was approved.

A "yes" vote supported this proposal to remove the cap on the amount of bonds the state is allowed to issue to a corporation, association, institution, or individual to help finance economic development projects and services.

A "no" vote opposed this proposal to remove the cap on bonds, keeping the state's prohibition on bonds that exceed 5 percent of annual state revenue.

Election results

Issue 3
Result		Votes	Percentage
a Yes		689,980	65.34%
No		366,020	34.66%

Election results from Arkansas Secretary of State

Overview

Amendment 82 of the Arkansas Constitution limited the issuance of general obligation bonds to an amount equivalent to 5 percent of state general revenues. In fiscal year 2015-2016, the maximum issuance amount was $259.5 million. Issue 3 removed this limitation and allowed the state to issue bonds in an amount over 5 percent of state general revenues.

In 1984, voters added Amendment 62 to the state constitution. Amendment 62 authorized counties and municipalities to issue bonds for "industrial development purposes" and required municipalities to sell bonds at public sales. Issue 3 modified Amendment 62, empowering cities, towns, and other municipal corporations, along with counties, to issue bonds and replacing "industrial development purposes" with "economic development projects." Issue 3 also removed the requirement to sell bonds at public sales, meaning bonds could be sold privately to investors. Furthermore, Issue 3 allowed counties, cities, towns, and school districts to issue bonds jointly for economic development projects.

The phrase "economic development projects" was defined as "the land, buildings, furnishings, equipment, facilities, infrastructure, and improvements that are required or suitable for the development, retention, or expansion of: (a) manufacturing, production, and industrial facilities; (b) research, technology, and development facilities; (c) recycling facilities; (d) distribution centers; (e) call centers; (f) warehouse facilities; (g) job training facilities; and (h) regional or national corporate headquarters facilities."

Issue 3 allowed the general assembly to retire bonds using other taxes, rather than only special taxes. The amendment did not define "other taxes."

Text of measure

Popular name

The popular name given for Issue 3 was as follows:

“

An Amendment to the Arkansas Constitution Concerning Job Creation, Job Expansion, and Economic Development.

”

Ballot title

The ballot title provided for Issue 3 was as follows:

“

An amendment to the Arkansas Constitution to encourage job creation, job expansion, and economic development; removing the limitation on the principal amount of general obligation bonds that may be issued under Amendment 82 of the Arkansas Constitution to attract large economic development projects; authorizing a city, county, town, or other municipal corporation to obtain or appropriate money for any corporation, association, institution, or individual to finance economic development projects and to provide economic development services; authorizing the issuance of bonds under Amendment 62 of the Arkansas Constitution for economic development projects; authorizing the taxes that may be pledged to retire bonds issued under Amendment 62 of the Arkansas Constitution for economic development projects; removing the requirement of a public sale for bonds issued under Amendment 62 of the Arkansas Constitution for economic development projects; and authorizing compacts for economic development projects among cities of the first and second class, incorporated towns, school districts and counties.

”

Constitutional changes

Issue 3 would amend the following sections of the Arkansas Constitution:

• Article 12, Section 5
• Amendment 62, Section 1(b)
• Amendment 62, Section 2
• Amendment 62, Section 5
• Amendment 62, Section 9
• Amendment 82

Issue 3 also repealed Amendment 62, Section 3

The full constitutional changes are available here.

Background

Voting on Bond Issues
Ballot Measures
By state
By year
Not on ballot
Local City bonds County bonds District bonds School bonds

See also: Bond issues on the ballot

Issue 3 addressed the topic of bond issues. Prior to 2016, 30 measures dealing with this topic appeared on statewide ballots in Arkansas. The first bond issue measure appeared on the ballot in 1880.

In 1984, Proposed Amendment 62 was approved. The measure authorized counties and municipalities to issue bonds for industrial development.

Voters added Amendment 82 to the Arkansas Constitution via Proposed Amendment 2 in 2004. The measure allowed the Arkansas Legislature to approve the issuing of general obligation bonds for economic development projects expecting to invest more than $500 million in capital expenditures and hire 500 new employees. Proposed Amendment 2 also required the amount of bonds issued in a given fiscal year to be equivalent to no more than five percent of state general revenues.

In 2010, the people of Arkansas approved Proposed Amendment 3, which amended Amendment 82 to remove the constitutional investment and hiring thresholds for issuing state bonds to attract major new industries to Arkansas. Over 60 percent of voters approved the amendment.

Issue 3 of 2016 removed the provision of Amendment 82 requiring the amount of bonds issued to be equivalent to no more than five percent of state general revenues. In fiscal year 2015-2016, Arkansas state general revenues were $5.19 billion, and five percent of that was $259.5 million.

Support

Sen. Jon Woods (R-7) sponsored Issue 3 in the Arkansas Legislature.

The measure was sponsored by Sen. Jon Woods (R-7).

Supporters

• Gov. Asa Hutchinson (R)

Arguments

The University of Arkansas Division of Agriculture's 2016 Ballot Issue Guide summarized proponents' arguments in five bullet points:

“

The constitution includes a patchwork of economic development language and definitions, making it difficult or impossible for local communities to take full advantage of valuable job creation tools. The amendment would clean up those inconsistencies, provide additional opportunities for cities to participate in economic development opportunities and enhance the state’s ability to attract large employers. Arkansas is at a disadvantage. Our constitution leaves us out of line with other states in this part of the country when it comes to giving communities the ability to engage in economic development efforts. Removing the cap on the amount of bonds the state could issue would help Arkansas compete for more large projects that could bring hundreds of new jobs to the state. It would regularize what many municipalities are already doing and clarify what local governments can do to offer incentives to companies. Being able to spend money locally on economic development would help cities and towns attract businesses and add jobs.

”

Clif Chitwood, a Mississippi County economic developer, argued:

“

First, it would enhance our state's ability to compete for large projects by removing the current restrictive five percent cap on Amendment 82 bonds. Any new bonds would still require the approval of both the elected Governor and the General Assembly. As Mississippi County has been and remains the only locality to have received a benefit from Amendment 82, it is highly unlikely that the rest of the state would allocate more of the now restricted fund to our county should Nucor, BRS, or any other of our large local manufacturers plan a significant expansion or have the opportunity to bring in a large user of their products wishing to co-locate near their plants. As we know. the downstream users of steel products have almost always accounted for more jobs than the mills themselves.

”

Sen. Jon Woods (R-7), the amendment's sponsor in the legislature, stated:

“

What Issue 3 does is allow counties and cities a seat at the bargaining table. If they want a business bad enough and it’s something they want to do, then let’s give them the ability to do it.

”

Opposition

Opponents

• The Liberty Initiative

Arguments

The University of Arkansas Division of Agriculture's 2016 Ballot Issue Guide summarized opponents' arguments in six bullet points:

“

It allows local governments to give away taxpayer money to a private corporation, association, institution or individual. There is no limit on how much state revenue may be pledged to private super projects. Theoretically, the state could approve the use of 100 percent of its general revenues or even more than 100 percent. Just one legislature could ruin the state budget and cause the need for tax increases for years to come. The proposal’s popular name is deceptive and designed to fool uninformed voters. Taking money from one business for the benefit of another business is no different than welfare. It’s a form of income redistribution. This will give you the ability to bankrupt your city. Bad decisions will come back to bite you. The amendment will reopen the door to sending local sales tax money from poor people to pay the salaries of chamber of commerce executives who lobby for policies contrary to the interest of poor people.

”

Campaign finance

See also: Campaign finance requirements for Arkansas ballot measures

Jobs for Arkansas supported Issue 3. The committee received a total of $386,495 in contributions.

Arkansas for Free Enterprise, which raised $29,000, supported Issue 2 and opposed Issues 1, 3, and 6. It is impossible to distinguish funds spent on each individual measure.

	Cash Contributions	In-Kind Contributions	Total Contributions	Cash Expenditures	Total Expenditures
Support	$386,495.00	$0.00	$386,495.00	$385,658.89	$385,658.89
Oppose	$29,000.00	$0.00	$29,000.00	$28,935.00	$28,935.00
Total	$415,495.00	$0.00	$415,495.00	$414,593.89	$414,593.89

Support

The following table includes contribution and expenditure totals for the committee(s) supporting the measure.

Committees in support of Issue 3
Committee	Cash Contributions	In-Kind Contributions	Total Contributions	Cash Expenditures	Total Expenditures
Jobs for Arkansas	$386,495.00	$0.00	$386,495.00	$385,658.89	$385,658.89
Total	$386,495.00	$0.00	$386,495.00	$385,658.89	$385,658.89

Donors

The following were the top donors to the support committee(s).

Donor	Cash Contributions	In-Kind Contributions	Total Contributions
Arkansas Economic Development Foundation	$55,000.00	$0.00	$55,000.00
Arkansas State Chamber of Commerce	$46,000.00	$0.00	$46,000.00
Little Rock Regional Chamber of Commerce	$35,000.00	$0.00	$35,000.00
Northwest Arkansas Chamber of Commerce	$20,000.00	$0.00	$20,000.00
Stephens Investments Holdings LLC	$20,000.00	$0.00	$20,000.00

Opposition

The following table includes contribution and expenditure totals for the committee(s) opposing the measure.

Committees in opposition to Issue 3
Committee	Cash Contributions	In-Kind Contributions	Total Contributions	Cash Expenditures	Total Expenditures
Arkansas for Free Enterprise	$29,000.00	$0.00	$29,000.00	$28,935.00	$28,935.00
Total	$29,000.00	$0.00	$29,000.00	$28,935.00	$28,935.00

Donors

The following were the top donors to the opposition committee(s).

Donor	Cash Contributions	In-Kind Contributions	Total Contributions
Conduit for Action	$14,500.00	$0.00	$14,500.00
Political Strategies LLC	$14,500.00	$0.00	$14,500.00

Methodology

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

Polls

See also: 2016 ballot measure polls

• On October 21, 2016, Talk Business & Politics-Hendrix College surveyed 463 likely voters and found 35 percent of respondents supporting and 30 percent opposing Issue 3.

Arkansas Issue 3 (2016)
Poll	Support	Oppose	Undecided	Margin of error	Sample size
Talk Business & Politics-Hendrix College 10/21/2016	35.0%	30.0%	35.0%	+/-4.6	463
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.

Path to the ballot

See also: Amending the Arkansas Constitution

Section 22, Article 19, of the Arkansas Constitution says that a majority vote is required in both houses of the Arkansas Legislature in order to send a measure to the ballot.

The Arkansas Senate passed Senate Joint Resolution (SJR) 16 on April 1, 2015, with 20 "yeas" and five "nays." The House approved it the next day with 70 "yeas" and 22 "nays."

Senate vote

April 1, 2015

Arkansas SJR 16 Senate Vote
Result		Votes	Percentage
a Yes		20	80.00%
No		5	20.00%

House vote

April 2, 2015

Arkansas SJR 16 House Vote
Result		Votes	Percentage
a Yes		70	76.08%
No		22	23.92%

"No" votes

The following legislators voted against placing the amendment on the ballot:

• Sen. Linda Chesterfield (D-30)
• Sen. Joyce Elliott (D-31)
• Sen. Bart Hester (R-1)
• Sen. Missy Irvin (R-18)
• Sen. David Johnson (D-32)
• Rep. Kelley Linck (R-99)
• Rep. Charles Armstrong (D-30)
• Rep. Bob Ballinger (R-97)
• Rep. Nate Bell (I-20)
• Rep. Mary Bentley (R-73)
• Rep. Andy Davis (R-31)
• Rep. Jana Della Rosa (R-90)
• Rep. Joe Farrer (R-44)
• Rep. Charlene Fite (R-80)
• Rep. Vivian Flowers (D-17)
• Rep. Kim Hammer (R-28)
• Rep. Kim Hendren (R-92)
• Rep. Grant Hodges (R-96)
• Rep. Douglas House (R-40)
• Rep. Fredrick Love (D-29)
• Rep. George McGill (D-78)
• Rep. David Meeks (R-70)
• Rep. Stephen Meeks (R-67)
• Rep. John Payton (R-64)
• Rep. Nelda Speaks (R-100)
• Rep. John W. Walker (D-34)
• Rep. David Whitaker (D-85)

State profile

Demographic data for Arkansas
	Arkansas	U.S.
Total population:	2,977,853	316,515,021
Land area (sq mi):	52,035	3,531,905
Race and ethnicity**
White:	78%	73.6%
Black/African American:	15.5%	12.6%
Asian:	1.4%	5.1%
Native American:	0.6%	0.8%
Pacific Islander:	0.2%	0.2%
Two or more:	2.1%	3%
Hispanic/Latino:	6.9%	17.1%
Education
High school graduation rate:	84.8%	86.7%
College graduation rate:	21.1%	29.8%
Income
Median household income:	$41,371	$53,889
Persons below poverty level:	22.9%	11.3%
Source: U.S. Census Bureau, "American Community Survey" (5-year estimates 2010-2015) Click here for more information on the 2020 census and here for more on its impact on the redistricting process in Arkansas. **Note: Percentages for race and ethnicity may add up to more than 100 percent because respondents may report more than one race and the Hispanic/Latino ethnicity may be selected in conjunction with any race. Read more about race and ethnicity in the census here.

Presidential voting pattern

See also: Presidential voting trends in Arkansas

Arkansas voted Republican in all seven presidential elections between 2000 and 2024.

Pivot Counties (2016)

Ballotpedia identified 206 counties that voted for Donald Trump (R) in 2016 after voting for Barack Obama (D) in 2008 and 2012. Collectively, Trump won these Pivot Counties by more than 580,000 votes. Of these 206 counties, one is located in Arkansas, accounting for 0.5 percent of the total pivot counties.

Pivot Counties (2020)

In 2020, Ballotpedia re-examined the 206 Pivot Counties to view their voting patterns following that year's presidential election. Ballotpedia defined those won by Trump won as Retained Pivot Counties and those won by Joe Biden (D) as Boomerang Pivot Counties. Nationwide, there were 181 Retained Pivot Counties and 25 Boomerang Pivot Counties. Arkansas had one Retained Pivot County, 0.55 percent of all Retained Pivot Counties.

More Arkansas coverage on Ballotpedia

• Elections in Arkansas
• United States congressional delegations from Arkansas
• Public policy in Arkansas
• Endorsers in Arkansas
• Arkansas fact checks
• More...

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Recent news

The link below is to the most recent stories in a Google news search for the terms Arkansas Removal Cap on Bonds Issue 3. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.

Arkansas Removal of Cap on State-Issued Bonds, Issue 3 (2016) - Google News

See also

• Arkansas 2016 ballot measures
• 2016 ballot measures
• Arkansas Legislature
• Bond issue

External links

• Senate Joint Resolution 16
• Arkansas 2016 Ballot Issues
• University of Arkansas 2016 Guide to Arkansas Ballot Measures

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