AR HB1690

Amends Arkansas Code § 27-70-207(c) to specify allowable uses of highway revenues distributed to cities and towns, including maintenance and construction of streets, public transportation, and other transportation system improvements.

Authorizes cities to provide these funds to regional mobility authorities to match federal transportation funds and to construct and maintain parking facilities and sidewalks for city buildings and parks.

Requires cities and towns that have spent highway revenues inconsistently with authorized purposes to repay the misused funds to their street fund by the end of the following fiscal year or pass an ordinance committing to pay 10% of general revenue annually until repaid.

Establishes enforcement mechanism where the Legislative Joint Auditing Committee can notify the Treasurer of State of improper spending, and the Treasurer must withhold future highway revenues until all misused funds are repaid.

Exempts funds from Section 2 of the Highway Improvement Revenue Act of 2007 from spending restrictions, allowing those funds to be used for any legitimate municipal purpose.