LITTLE ROCK—Arkansas lawmakers begin their pre-session review of state agency budgets Tuesday, as Gov. Mike Beebe considers whether the state can afford to restore funds cut last spring.

The Joint Budget Committee hearings begin Tuesday and are scheduled through Nov. 19 in preparation for the regular session that begins in January. The committee will consider budget requests from the various state agencies for the fiscal years beginning July 1, 2009, and July 1, 2010.

“Everybody needs more money. That’s just the nature of it,” said Rep. Chris Thyer, D-Jonesboro, committee co-chairman. “Frankly, I don’t think there is going to be a whole bunch of new money (for state programs) the next two years.”

The state’s general revenues, which come mainly from income and sales taxes, is $4.4 billion this fiscal year. The total budget amounts to about $20 billion.

In April, state finance officials cut $107 million from state agencies’ budgets for the current fiscal year. But the governor said Friday he would review over the weekend whether the state could restore money cut from some agencies given a recent surge in state revenues. More specifically, he said, he might restore some funding to Medicaid, cut by $58 million in May.

At the same time, Beebe is considering priorities for the upcoming session. He has until Nov. 13 to release his proposed balanced budget for the two fiscal years, and has said public schools will again be a top priority, in light of a statewide overhaul of the education system. The yearly public school fund is $1.9 billion.

Medicaid also would be a priority, he said. The program is seeking $93 million more in general revenue next fiscal year and $111 million more the following year.

The state’s foster-care system also has critical needs, Beebe said. He said he plans to pursue eliminating the 3-cent sales tax on groceries after essential state services are met. The tax brings in about $130 million a year for the state.

“It’s essential we have prison beds to keep murderers and rapists in prison. It’s essential that we prioritize children and family services. It’s essential we try as much as we can to keep college as affordable as we can keep it. It’s essential we don’t run out of money for Medicaid match so we have to throw people out of nursing homes,” the governor said. “There are a lot of essentials.”

Beebe said his administration would be “relatively conservative” in forecasting state revenue over the next two years. He said it was easier to add to budgets if revenues exceed forecasts than to cut back if revenues fall short of predictions.