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LITTLE ROCK, Ark. (AP) - Arkansas lawmakers have no shortage of challenges to overcome when they convene for this year's legislative session. From decisions over whether to expand Medicaid to proposals to further restrict abortions, there's a long list of issues on the agenda for the 89th General Assembly.

A look at some of the biggest items on the agenda:

BUDGET: Gov. Mike Beebe has proposed a $4.9 billion budget for the coming year that increases overall state spending by $180 million. The state Department of Human Services, which manages the state's Medicaid program, would receive the largest share of the budget increase, $98 million in additional funding. Beebe's proposed increasing public school funding by $49 million and increasing funding for institutions of higher education by $10 million. The budget proposal also calls for 2 percent cost-of-living increase for most state employees, a pay raise that would cost the state $12 million next year, and setting aside $10 million for a rainy day fund the state could tap in case of financial problems.

MEDICAID: The state's Medicaid program faces a $138 million shortfall, despite proposals to increase funding. Beebe has proposed setting aside $140 million of the state's projected $300 million surplus to help Medicaid with a projected shortfall. The Department of Human Services has proposed several cuts to services, including eliminating the lowest level of nursing home care paid for by the program, to make up for the shortfall. Beebe has said he wants to avoid the nursing home cuts, while the incoming leaders of the House and Senate say they believe the cuts can be avoided by using more from the state's surplus. Beebe is also urging the Legislature to support expanding Medicaid's eligibility under the federal health care law. Republicans generally oppose the expansion, but some have floated a compromise that would allow it in exchange for changes to program they believe will save the state money.

TAX CUTS: Beebe has proposed cutting the state's grocery tax from 1.5 percent to 0.125 percent, but only if the state's desegregation payments to three Little Rock school districts or several bond obligations decrease by $35 million over six months. Republicans say they believe there's room for debate on other tax cuts, despite the Medicaid shortfall. The competing ideas include reductions in the state income tax and the taxes manufacturers pay on utilities.

EDUCATION: Two court rulings are likely to take up most of the Legislature's attention on education issues. Lawmakers will likely vote on changes to the state's school choice law. A federal judge in June struck down the 1989 law, saying race couldn't be the only factor considered in deciding whether students could transfer between districts. The Legislature is also expected to consider legislation that would give the state the authority to collect extra money from school districts where higher property tax collections pushed the districts above total school funding levels set by state law. The move is in response to a state Supreme Court ruling last year that the money was not considered state revenue. Other education items on the agenda include legislation aimed at increasing the number of charter schools in the state and a proposal to create a private school scholarship program.

VOTER ID: Lawmakers will consider a proposal that will require voters to show photo identification in order to cast a ballot. Poll workers are currently required to ask for photo ID, but voters are not required to show one in order to cast a ballot. The proposal - outlined in a Senate bill and a proposed constitutional amendment - would allow voters who don't show photo ID to cast a provisional ballot, but the vote would not be counted unless they return to the county election commission with an ID or an affidavit explaining that the voter cannot show ID because of indigence or a religious objection. Similar legislation passed the House in 2011, but died before a Senate committee.

LOTTERY SCHOLARSHIPS: The Lottery Oversight Committee has proposed giving university students $3,300 per year and community college students $1,650. In 2010, the first class of lottery scholarship recipients was awarded $5,000 for university students and $2,500 for students at community colleges. That was trimmed the following year to $4,500 and $2,225, where it remained through this year's class.

ABORTION: Abortion opponents see a chance to enact new restrictions with Republicans controlling the House and Senate this year. The proposals expected include legislation to ban abortion after 20 weeks of pregnancy, based on the disputed claim that a fetus can feel pain after that point. Other legislation anti-abortion groups expect to support include a proposal that to ban most abortions from being covered through the health insurance exchange that would be created under the federal health care law and a prohibition on the use of telemedicine to make the abortion pill available.

(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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