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State Still in General Fund Budget Chaos

Brandon Moseley

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By Brandon Moseley
Alabama Political Reporter

In February, Alabama Governor Robert Bentley (R) announced that the State faced a general fund budget shortfall and his answer to that would be to raise taxes.

Gov. Bentley said then, “We have to face the problems and we have to do it with boldness. I am going to present a plan to the legislature to do it.  I am going to push for it.”

Eventually, Bentley proposed $541 million in tax increases.  While Bentley found a bipartisan group of sponsors for his agenda none of his bills have progressed very far in the legislature.

On Monday, April 27, Gov. Bentley spoke to the Chamber of Commerce in Cullman County:

“We are facing a tremendous crisis in our General Fund Budget that will impact every Alabama County if not addressed by the Alabama Legislature.  I am committed to finding new revenue so our State agencies can continue to provide essential services to Alabamians. For decades, we have failed to address the way our non-education state agencies are funded.  With no one-time money available to support the General Fund and debts that are owed, we have a real crisis on our hands…Now is the time for real solutions to address our budget challenges.  I was elected to solve problems, and I urge members of the Legislature to work with me to put this State on a successful path forward.  By working together, we can make Alabama better for future generations.”

While Bentley found a bipartisan group of sponsors for his agenda, none of his bills have progressed very far in the legislature; which has been very skeptical about both the problem and the Bentley’s solution.

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There is a General Fund Budget that is before the legislature with no revenue increases that would mean deep cuts to just about everything in the General Fund.

Governor Bentley said in Cullman: “The Alabama Legislature is considering a proposal that deeply cuts funding for State services. Each State agency was created by law to provide specific services to taxpayers.  If enacted, these cuts will put the State in a position incapable of providing many of the essential services of government.”

State Senator Phil Williams (R-Rainbow City) said:

“I have said all along that I do not favor raising taxes on Alabamians and I stand by that. The problem is not whether we have enough revenue (we do), the problem is how our current revenue is spent, appropriated, allocated, and earmarked. A change must be made to allow the State to do business like a business.”

On Monday, Senate President Pro Tem Del Marsh (R-Anniston) offered a solution that was first proposed by state House Minority Leader Craig Ford (D-Gadsden).  Sen. Marsh is proposing starting a State lottery, signing a compact with the Poarch Creek Indians allowing them to operate in the state in exchange for a share of the revenue, and allowing gaming at Victoryland, Greene Track, the Birmingham Race Course, and the Mobile Dog Track.

Former Gov. Bob Riley (R) had shut down electronic bingo at those facilities during his last term in office after the courts ruled that Alabama Law did not allow electronic bingo machines. The Poarch Creek casinos have been able to stay open to this point because the Federal government’s Bureau of Indian Affairs maintains that they have jurisdiction over Indian gaming and PCI’s operations are legal……an opinion disputed by Alabama Attorney General Luther Strange (R).

Senator Marsh claimed in a statement, “These two ideas will generate hundreds of millions of new dollars for State programs at a time when essential government services may be cut.  And 11,000 new jobs that will positively impact families throughout our State.”

Sen. Marsh said, “At a time when we are talking about either massive budgets cuts or higher taxes, this is certainly something we need to take a look at and consider,” he said.  “I’m not sure there are any ideas out there that can create 11,000 new jobs while generating that kind of revenue for State government.”

Meanwhile according to original reporting by the Montgomery Advertiser’s Bryan Lyman and Josh Moon, the Poarch Creek Band of Indians are telling legislators that they would prefer an exclusive arrangement with the State that would generate $250 million a year for State revenues.

Alabama State Auditor Jim Zeigler (R) wrote on Facebook, “Interesting. Poarch Creek Indians offer to bail out State with $250 million if the state will not allow any further gambling — just the present Indian operations. No more.”

State Senator Paul L. Sanford (R) said:

“There are three or four Republicans that are willing to filibuster a lottery/gaming bill, yet they offer no options. Ideas they would rather raise your taxes and protect the Indian Bingo machines.  Ask all Republicans to support SB12 my Recurring Revenue Bill that would shift approx. $150 million in excess revenue to the General Fund. That’s right. I said it. Excess Revenue. Otherwise this money goes into the Stabilization Fund. Seems like a good time to stabilize our budgets while looking to the future with the Recurring Revenue Act.”

Rep. Craig Ford wrote Sunday, “On the one hand, I’m glad to see Republicans embracing the Democratic Party’s legislative agenda. A lottery has been a part of Democrats’ platform for decades, and I’ve been proud to sponsor the lottery bill every year since I became Minority Leader.   On the other hand, it’s a sad statement on the extreme partisanship in Montgomery. Even after Rep. Steve Clouse, the Republican chairman of the General Fund budget committee, signed on as a co-sponsor of my lottery bill, the Republican leadership in the legislature still couldn’t bear to support a Democrat’s bill. Instead, they will take my lottery bill and Rep. Thomas Jackson’s (D-Thomasville) resolution authorizing the governor to negotiate a compact with the Poarch Creek Indians, and combine them into one Senate bill just so they can say it’s a Republican bill instead of a Democrats’ bill.  This kind of behavior is downright childish and insulting to the taxpayers! I think most people would agree they’d rather have a lottery and compact than more taxes. Political Party shouldn’t even enter into the equation!”

2010 was the last time the state legislature seriously considered a gambling bill.  The bill passed the then Democratic controlled state Senate but stalled in the House when it was revealed that the FBI was investigating gambling magnates and legislators on bribery and conspiracy charges.

Most people support an education lottery like Georgia’s, where the lottery proceeds pay for college scholarships. The proposed lottery and gambling expansion will be used for Alabama Medicaid, prisons, courts, State troopers, and other general fund agencies.  Without any direct benefit for them or their families it is questioned by some if a lottery and expanded gaming can even pass a vote of the electorate.

The Alabama Policy Institute (API) opposes the gaming expansion.  API’s Katherine G Robinson and Caleb Crosby wrote, “API has proposed or supported a number of ideas that, if implemented, would help fill the budget gap. We’ve researched and recommended various cost-saving reforms to our public pensions, Medicaid prescription reform, eliminating vacant positions within state government, privatizing ABC and bidding out various nonessential government services, exploring tax amnesty to generate revenue already owed to the State, and bringing health insurance premiums of State employees more in balance with those of private sector workers. Some of these ideas are making their way through the legislature and some are not. All of them would be challenging to pass-they are all disfavored by one group or another–but none of them exploit the poor.  Using the excuse of a budget shortfall to pave the way for more gambling is irresponsible, the effects of which would plague our State long past the political careers of those leading this charge.”

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