Beebe Supports Lifting Business Investment Ban

Monday, Mar 16, 2009

(Courtesy of USAToday.com and the Associated Press)

Gov. Mike Beebe supports lifting a constitutional ban blocking the state from investing in private companies, something he says could support high-tech ventures, his spokesman said.

Beebe favors House Speaker Robbie Wills' proposed constitutional amendment that would lift the ban and allow the state to invest in technology-based enterprises, spokesman Matt DeCample said. Wills says he'll soon add details to the bill, which exists now only as a shell.

DeCample said research at state schools like the University of Arkansas for Medical Sciences and the University of Arkansas at Fayetteville could spin off companies and products with great potential. However, he cautioned the state wouldn't make such investments without extensive review and analysis.

"If you want to call it a bet, it would be the safest bet possible," DeCample told the Arkansas Democrat-Gazette.

Wills, D-Conway, said he proposed the measure for Accelerate Arkansas, a group of businessmen who hope to raise the state's per-capita income. A state task force also issued a report in November suggesting to remove the constitutional ban.

The Task Force on the 21st Century Economy said Oklahoma recently decided to use investment as a tool to provide seed capital for tech-based firms and research-oriented businesses. North Carolina secured such a large return on one of its investments that it was able to fund broadband access for a large rural section of the state, the task force said.

In exchange for its investments, the state could receive stock or other securities in companies.

Wills acknowledged that the timing of his proposal is "unfortunate" with the economic downturn possibly causing some people to question the wisdom of state investments in private companies.

"It is something that would be very helpful for growing knowledge-based jobs in Arkansas," he said. "But we have to look and see if now is the right time to do it.

"The bottom line is the voters would have to approve this. As we go through the election process, we are not going to force anything on the state. We just want to have the opportunity for the people to make a decision on it and other states have this ability."

Wills' proposal is among 24 constitutional amendments filed by lawmakers this session. The constitution allows legislators to refer up to three amendments to the voters and a fourth if it involves state officials' salaries.