All Roll Calls
Yes: 110 • No: 6
ArkansasSB4212025 Regular SessionSenate
TO AUTHORIZE THE ARKANSAS NATURAL RESOURCES COMMISSION TO ISSUE GENERAL OBLIGATION BONDS FOR THE DEVELOPMENT OF WATER, WASTE DISPOSAL, AND POLLUTION ABATEMENT PROJECTS.
Sponsored By: Howard M. Beaty, Jr. (Republican), Bart Hester (Republican)
Enacted
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Bill Overview
Analyzed Economic Effects
6 provisions identified: 4 benefits, 2 costs, 0 mixed.
More financing options for local water projects
The Commission can use bond money or project revenue for local project loans, grants, and matching funds. It can buy local bonds or notes and refinance Commission loans or local debt used to develop eligible projects. Local entities can lend funds to others, and written procedures can establish revolving funds and other financing arrangements. Local entities managing funds containing bond proceeds must have arrangements requiring audits at least annually. The Commission can also require audits of funded project accounts covering construction, operation, or maintenance.
Voters decide Arkansas water project borrowing
The Arkansas Natural Resources Commission can issue up to $500 million in state bonds for water and environmental projects. This includes up to $165 million for irrigation facilities. Voters must approve borrowing at the 2026 general election or an earlier special election called by the Governor. A majority vote against borrowing ends this authority. Borrowing is capped at $60 million per two-year period beginning July 1 of odd-numbered years, unless lawmakers authorize more. Starting July 1, 2027, each period requires a written project plan and the Governor’s approval by proclamation. The Governor reviews state budget hardship with the Chief Fiscal Officer and gets required legislative advice. Bonds that replace outstanding bonds under this law or the prior act are exempt from these plan and approval requirements. Replacement principal does not count toward the $500 million and $60 million caps up to the outstanding principal replaced. Replacement bonds keep the same payment priority; rights under this law begin only after the first series is sold and delivered.
State revenue pays water bonds first
Arkansas pledges its full faith and credit to repay these bonds while they remain outstanding. The Treasurer must transfer money monthly from the State Apportionment Fund to the dedicated bond fund. These debt payments have first claim on state general revenues, with equal priority to other state general obligation bonds. This commits state revenue to repayment before other spending uses.
Water bond investors get tax protections
These bonds and their interest are exempt from Arkansas state, county, and city income, inheritance, and property taxes. Banks, insurers, fiduciary funds, trusts, and public funds can legally invest in them. The bonds can also secure deposits of public money. The law creates a contract with registered bond owners that the state cannot impair. Bondholders and taxpayers can ask courts to stop violations, prevent or reverse diversion of pledged money, and enforce state promises.
Arkansas gains water service and land powers
The Commission can develop, operate, and maintain projects and acquire, store, treat, transport, distribute, sell, or provide water. It can help local entities prepare sites to use its water and build project property there. It can use watercourse beds and tax-forfeited land owned or held by the state or local governments. Watercourse-bed use cannot harm existing shoreline-owner rights, highway rights, rights-of-way, easements, or similar property rights. These powers do not guarantee service to any household or set household prices.
Commission can charge water borrowers and users
The Commission can set and collect rates, fees, rents, and other charges for loans and loan commitments. Charges can also cover accounting, loan servicing, and use of Commission property or services. The Arkansas Public Service Commission does not control these charges. The law sets no charge amounts and does not directly require households to pay.
Sponsors & Cosponsors
Sponsors
Howard M. Beaty, Jr.
Republican • House
Bart Hester
Republican • Senate
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
House vote • 4/7/2025
House Vote - Monday, April 7, 2025 8:21:06 PM
Yes: 86 • No: 3 • Other: 5
Senate vote • 3/19/2025
Senate Vote - Wednesday, March 19, 2025 3:35:15 PM
Yes: 24 • No: 3 • Other: 3
Actions Timeline
Notification that SB421 is now Act 578
4/14/2025SenateDELIVERED TO GOVERNOR.
4/9/2025SenateReported correctly enrolled and ordered delivered to the Governor.
4/9/2025SenateORDERED ENROLLED
4/8/2025SenateReturned from the House as passed.
4/8/2025SenateReturned to the Senate as passed.
4/8/2025HouseRead the third time and passed and ordered transmitted to the Senate.
4/7/2025HouseReturned by the Committee Do Pass
4/2/2025HouseRead the first time, rules suspended, read the second time and referred to the Committee on AGRICULTURE, FORESTRY & ECONOMIC DEVELOPMENT- HOUSE
3/19/2025HouseRECEIVED FROM THE SENATE
3/19/2025HouseOrdered immediately transmitted to the House.
3/19/2025SenateRead the third time and passed.
3/19/2025SenateReturned by the Committee, with the recommendation that it Do Pass
3/18/2025SenateRead first time, rules suspended, read second time, referred to AGRICULTURE, FORESTRY & ECONOMIC DEVELOPMENT - SENATE
3/11/2025SenateFiled
3/11/2025Senate
Bill Text
SB421 - Introduced
3/11/2025
Act Version
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