UPDATE Beebe: Rolling back tax cuts one way to deal with teacher insurance crisis


LITTLE ROCK — Gov. Mike Beebe said Wednesday that rolling back tax cuts is one possible way to address skyrocketing teachers’ health insurance premiums.

In a live-streamed Internet interview with Talk Business publisher Roby Brock, Beebe said one option for giving teachers relief from sharply increasing insurance premiums would for the state Legislature to “back off some of the tax decreases, the tax cuts, that they made last time and apply some of that money.”

Earlier this year the Legislature passed phased-in tax cuts that will total about $140 million by the 2015-16 fiscal year. Beebe said lawmakers could roll back some of the tax cuts before they take effect to avoid raising taxes.

“I’d rather see them take that option than a tax increase,” he said. “But there are other options, too.”

Those other options include shifting money from other funds, increasing state control of how school districts allocate money for insurance and reviewing the system for possible changes, he said.

One short-term solution, he said, would be to draw from a fund of about $200 million that supports the National School Lunch Act program. The NSLA money funds programs to benefit low-income students.

“Now, a lot of superintendents don’t want to do that,” he said.

Beebe cautioned that “throwing short-term money” at the problem would not be enough without also taking a long-term approach.

Waiting until the 2014 fiscal session to address the problem would mean that teachers would be hit with “catastrophic increases” in their premiums, Beebe said. But he also said he would not call a special session unless a consensus on how to fix the problem has been reached in advance so that “you can get in and out in three days.”

Meetings are going on now to try to reach a consensus, Beebe said.

Beebe also was asked about Lt. Gov. Mark Darr, who is being investigated by the state Ethics Commission regarding possible violations of ethics laws regarding campaign finances.

A complaint filed by a liberal blogger alleges that Darr spent thousands of dollars of campaign cash on personal items such as hotel rooms, fuel and Razorback season tickets after his 2010 election. Darr has said he believed at that time that he could spend campaign cash on personal items as a way of repaying loans he made to his campaign. The commission is investigating whether Darr violated up to eight different state statutes.

“If it’s true, it’s wrong and there have to be consequences,” Beebe said.

Darr recently dropped out of the Republican 4th District congressional race and has not said whether he will seek re-election next year.