By Thomas Scovill
Alabama Political Reporter
SB13 is one of several draft bills which have been prefiled for the Alabama legislature to consider during the upcoming 2013 session which begins in February. It purports to require the legislature to pay back the $438 million that voters just approved transferring over the next three years from the Alabama Trust Fund to the General Fund. In fact it is nothing more than smoke and mirrors and in the same way “bad money drives out good,” SB13 will be counterproductive to its very worthy purpose.
The proposed bill states:
Notwithstanding any other provision of law to the contrary, the Legislature shall provide for the repayment of all funds transferred from the Alabama Trust Fund to the State General Fund pursuant to Amendment to the Constitution of Alabama of 1901 within ten (10) years following the fiscal year ending September 30, 2015.
In the event that full repayment has not been made by September 30, 2025, an appropriation of any amount not repaid shall be made from the State General Fund in the fiscal year ending September 30, 2026.
There are problems with the proposed bill.
It does not require any action before fiscal year 2026 and so is merely a kicking of the can down the road.
There is no way to compel the legislature to make an appropriation for fiscal year 2026 and there is no penalty if it does not. In fact, the legislation could be repealed by any legislature after the issue fades and its champions leave the legislature.
It does not require interest to be paid and it does not account for inflation.
A better bill would require repayment beginning no later than fiscal year 2016. It would require substantial payments in the early years. It would specify revenue sources or spending offsets for the repayment. And it would require interest pegged to the prime or other widely used rate.
SB13 is sponsored by Senators Taylor, Bussman, Allen, Williams, Glover, Waggoner, Pittman, Orr, Marsh, Holley, Brewbaker, Scofield and McGill. I am sure they mean well, but at best SB13 is merely well intended hand waving. Further consideration of SB13 will consume the time and energy needed to pass the better legislation that the people of Alabama deserve. This is worse than no bill at all.