LITTLE ROCK, Ark. — When Arkansas’ highest court ruled more than a decade ago that lawmakers couldn’t steer state money toward their favorite local pet projects, part of the Legislature’s workaround was to direct money to regional agencies for distribution. Justices will revisit the issue this week as they hear a lawsuit that argues the solution crafted to the ban on strictly local projects is just as bad, if not worse.

It could wind up being another black eye for a system that’s prompted federal investigations and may have already fallen out of favor at the state Capitol.

The state Supreme Court on Thursday will hear oral arguments in a case challenging $2.9 million in state surplus money that went toward the Central Arkansas Planning and Development District in 2015. A Pulaski County judge last year dismissed a lawsuit that accused lawmakers of using the district to send money to the legislators’ pet projects.

The lawsuit comes from Mike Wilson, the former state representative who successfully challenged the Legislature’s practice of divvying up surplus money known as the General Improvement Fund, which funded local needs ranging from sidewalk improvements to ballparks. The state Supreme Court sided with Wilson in 2006, ruling that the appropriations violated the state Constitution’s ban on strictly local legislation.

Wilson said legislators are still able to dictate where the money from the district would go, effectively allowing them to earmark the money for pork barrel projects.

“The Legislature attempted to skirt the Amendment 14 issue found by this court in the Wilson cases by devising a grant system which gave the individual senators and representatives around the state an equal amount of money to distribute within their district,” Wilson wrote in a filing with the court. “However, it remains black letter law that they cannot do indirectly what they cannot do directly nor can Amendment 14 be violated by using a ‘grant’ system devoid of oversight.”

The state argues the grants can’t be considered strictly local, since all eight of the state’s planning and development districts received GIF money.

“If an appropriation limited to a single county for a single project can be said to promote statewide economic development, then the 2015 Acts appropriating funds to all of the districts that collectively cover the entire state undeniably promote statewide economic development,” lawyers for the state said in a filing with the court.

The case comes as the Legislature’s handling of local project money faces scrutiny from federal investigators. Former state Sen. Jon Woods and two others have pleaded not guilty to corruption charges after prosecutors said they participated in a scheme where Woods allegedly directed GIF money to Ecclesia College in return for kickbacks. Republican former state Rep. Micah Neal pleaded guilty in January to four counts of fraud related to the case. Separately, federal court documents show that a search warrant seeking material from Sen. Jake Files involves $46,500 in GIF money for work at a Fort Smith sports complex. Files has not been charged with a crime and says he is cooperating with law enforcement.

The probes also follow a session in which a tight budget prompted Gov. Asa Hutchinson and lawmakers to not include any money for legislative projects in the GIF. Instead, the money went toward a rainy day fund that could be tapped for emergency needs.

Depending on how the court rules, Wilson’s case could ensure the practice won’t be revived even in more robust budget years.


Andrew DeMillo has followed Arkansas government and politics for The Associated Press since 2005. Follow him on Twitter at www.twitter.com/ademillo

An AP News Analysis