Analysis: Arkansas special session puts focus back on jobs

Little Rock, Ark. (AP) — An effort to lure a major defense contract to south Arkansas is offering Gov. Asa Hutchinson a chance to put the focus back on jobs weeks after a legislative session that ended with an unexpected fight over a religious objections law.

But the special session planned later this month could also renew the debate over how much a Republican-controlled Legislature is willing to shed its dislike of government spending in exchange for the promise of a major economic development project.

Hutchinson announced last week he's calling lawmakers back to the Capitol on May 26 to take up an incentive package intended to help Lockheed Martin win its bid for a contract manufacturing a new line of tactical vehicles to replace the Humvee. The Maryland-based company has said it plans to produce the vehicles at its Camden facility.

"There's not any guarantee the Department of Defense will award that contract. We are hopeful that they will," Hutchinson told members of the Political Animals Club last week. "But it is the right step for Arkansas and the right step for our nation."

The move allows Hutchinson to put a new postscript on his agenda after he and the GOP Legislature hurriedly revamped a religious objections law that faced widespread criticism — including from Bentonville-based retail giant Wal-Mart — that it promoted discrimination against gays and lesbians. The changes came at the end of an 82-day regular session that Hutchinson had tried to keep on fiscal, rather than social, issues.

Gay rights groups are hoping to keep at least a part of the focus on social issues, urging Hutchinson to issue an executive order banning workplace discrimination against gay, lesbian, bisexual and transgender state employees. Local governments, meanwhile, are pushing back against another law prohibiting city and county anti-discrimination ordinances for the LGBT community.

Hutchinson has already been trying to keep the focus on jobs, touring the state to tout a new law he had campaigned on to require computer science classes in all state public high schools.

The Lockheed Martin project will face familiar questions from lawmakers over how much the state should be willing to invest in the hunt for major employers.

The value of any potential Lockheed Martin aid hasn't been announced.

Though legislative leaders say they expect lawmakers to support the proposed package, it will put another spotlight on the role incentives play in economic development. If approved by lawmakers, this will mark the second time Arkansas has used a 2004 constitutional amendment allowing the state to issue bonds for "super projects."

"I think once the membership is able to see all of the information that we have, I feel like they're going to be as excited as we are about the project," House Speaker Jeremy Gillam, R-Judsonia, said.

Lawmakers two years ago approved $125 million in financing for the $1.1 billion Big River Steel mill under construction in Osceola, a project that's expected to create more than 525 permanent jobs. The financing easily won support, despite arguments from some lawmakers that the government shouldn't be subsidizing the startup costs for a private business.

Those concerns also came up earlier this year as the Legislature voted to put on next year's ballot a constitutional amendment that removes the cap on bonds the state can issue in economic development bonds.

Republican Rep. Doug House, who voted against the amendment earlier this year and against the Big River Steel financing two years ago, said he's likely to back the Lockheed Martin project. House said he views this proposal differently, since the bonds are expected to go partly toward job training for the program and it's contingent on the company winning the defense contract.

"It's a tremendous investment, not just handing out money and hoping things go right," House said.

By Andrew DeMillo, Associated Press. Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

The Gayly – May 16, 2015 @ 2:55pm.