What happens if plan fails?

Published 12:00 am Tuesday, September 2, 2003

The Sept. 9 vote on Gov. Bob Riley’s tax and accountability package is sure to be an historic one, both in Shelby County and in the state of Alabama.

Voters will decide on the $1.3 billion package that includes tax increases, tax changes and accountability reforms.

The package establishes a fund into which all new revenue will flow. The fund will then, like the current general fund and education trust fund, be distributed by the Legislature.

The package has been hotly debated during the past two months among those of the same political party, family members, co-workers and church members.

But one thing is for sure, according to Shelby County Rep. Jim McClendon.

&uot;A referendum is as democratic as it gets.&uot;

McClendon, who said he plans to vote for the package, said it would enable the state to get out of debt and &uot;have money left over for improvements.&uot;

Rep. Mary Sue McClurkin agreed.

&uot;I think if it does pass, we will have an opportunity to have a tax base to support the services we have and to make improvements in education, public safety, Medicaid and many other essential government services as well as have a mechanism for accountability of how money is spent.&uot;

Rep. Mike Hill agreed.

&uot;There will be many new and innovative programs that have been tried and successful in other states that we will have the money to implement (if the packages passes),&uot; he said.

Calera Mayor George Roy said he believes &uot;if we want to improve our education and transportation system to have better schools and roads, we should support the tax package.&uot;

&uot;If it does pass,&uot; he said, &uot;then we can look forward to better schools, roads and infrastructure that a rapid growing community such as ours both requires and deserves.&uot;

If the package does not pass, Mayor Roy predicts, the state will remain &uot;status quo.&uot;

Pelham Mayor Bobby Hayes had other ideas, however.

&uot;The Legislature will have to raise some taxes, and they, not the public, will decide which ones. I feel taxes will go up regardless of the outcome of the vote Sept. 9,&uot; Hayes said.

Rep. Steve French agreed, predicting &uot;a series of cuts&uot; and a sales tax increase on tobacco products.

&uot;We will limp by until a more favorable solution can be found,&uot; he said.

Others found the notion of &uot;limping by&uot; an unpleasant one.

Rep. McClurkin said the cuts would be drastic.

&uot;We are going to have to cut some essential services that people have grown used to. We are going to have to get used to doing less,&uot; she said. &uot;In some things, that might be OK and in others, not.&uot;

McClurkin said if Alabama residents vote the tax package down, she will not support any other taxes that the Legislature might levy without a vote of the people.

Hill pointed to the continuation of Alabama’s bottom status should the tax package fail to pass.

&uot;We will continue to be on the bottom in education, the way we provide for our children, deaths on the highways, etc.,&uot; he said. &uot;I get tired of being compared with Mississippi and Arkansas on every issue.&uot;

Columbiana Mayor Allan Lowe said he believes education will benefit from the package.

&uot;(If it does not pass), schools will continue to suffer due to inadequate funding at the state level,&uot; he said.

Chelsea Mayor Earl Niven agrees that education will benefit from the package.

&uot;If this doesn’t pass, we will just sink further in the hole. The state will come up with some way to raise funds for education. But it will be a patchwork goal to try to keep us above water,&uot; he said. &uot;The Riley plan will give us a little more daylight.&uot;

Others disagree, however, believing the package presents an increase in centralized government.

&uot;A 25 percent increase in state government, in the budget, therefore the size and an increase in the centralization of power in Montgomery,&uot; Rep. French predicted.

Shelby County Commissioner Ted Crockett agreed that the plan only brings &uot;more government.&uot;

&uot;Montgomery needs to wake up,&uot; he said. &uot;Our county commission has not raised taxes since I’ve been on the commission. We’ve got a good county commission that does what needs to be done. We’ve managed the money well and Montgomery needs to do that.&uot;

Commissioner Joel Bearden agreed.

&uot;I’m a firm believer that they can cut spending and balance the budget without the monstrous increase of $1.3 billion in taxes that they are asking for,&uot; he said.

Rep. Jim Carns said he believes tax increases cost jobs, viewing the tax increases the same way President George W. Bush has asked the country to view tax cuts.

&uot;Who do you think knows how to spend your money best, you or the government?&uot; he asked.

&uot;Only the private sector creates jobs. When you take money away from the private sector through new taxes, businesses have only two options &045; cut jobs or raise prices, or both. &uot;It has been my experience that government always manages to insist that it needs more money regardless of how much it takes. I have no doubt that, even if the voters pass the plan, the government will be back within the next three or four years asking for more,&uot; Carns said.

On the other hand, he said, if the package does not pass, &uot;government may have to tighten its belt, just as private citizens do when they lose their jobs or are otherwise faced with economic hardships.

&uot;The government will never consider changing itself as long as the people can be hoodwinked into giving it more money when it overspends.&uot;

Shelby County’s elected officials have urged that voters learn as much about both sides as possible in attempting to make an educated decision.

Mayor Hayes said he hoped people would try to &uot;get the facts on the plan and not let their decision be swayed by untrue statements from either side of the issue.&uot;

Mayor Lowe agreed.

&uot;Take the time to become familiar with all of the effects this plan would have on our state or ask the advice of a trusted friend who is knowledgeable on this tax plan,&uot; he said. &uot;Don’t take the advice of people who claim that the plan is extremely bad or incredibly good. These people really don’t know.&uot;

Rep. Cam Ward said regardless of the results of the vote, the debate has been a good one for residents of Alabama.

&uot;Alabama will be better off with an electorate more informed about our government,&uot; Ward said. &uot;We have many problems facing this state, and they cannot be solved by sitting on the sidelines and not participating in the debate.&uot;

If the package does not pass, however, the governor has predicted, first and foremost, at least an 18 percent across-the-board cut in both the general fund and the education trust fund budgets.

Following the Sept. 9 vote, the Legislature will reconvene to pass both budgets. Approval of the budgets was postponed by Montgomery officials to await the decision of the voters on proposed tax increases.

The education trust fund budget for fiscal year 2003 was $4.246 billion. An 18 percent cut would amount to about $764.3 million, leaving a balance of some $3.482 billion.

Large budget items include the K-12 Foundation Program with a budget of $2.541 billion. An 18 percent cut of $457.4 million would result in $2.084 billion for the program.

Other items included in the budget are The American Village, which currently receives $178,229 from the state; the prison education system, which is currently budgeted at $8 million; the Arts Council which is currently budgeted at $3.833 million; the Alabama Reading Initiative program which is currently budgeted at $12.5 million; the Educational Television Commission which is currently budgeted at $8.976 million; the Alabama School of Fine Arts, budgeted at $4.089 million; the Department of Human Resources, budgeted at $6.978 million; the Public School and College Authority, budgeted at $3 million; the Deaf and Blind Institute, budgeted at $35.07 million; and the Department of Public Health, budgeted at 13.85 million.

If cut 18 percent, budgets would fall to $148,147 for The American Village; $6.6 million for prison education system; $3.1 million for the Arts Council; the Alabama Reading Initiative program, $10.3 million; the Educational Television Commission, $7.4 million; the Alabama School of Fine Arts, $3.4 million; the Department of Human Resources, $5.7 million; the Public School and College Authority, $2.5 million; the Deaf and Blind Institute, $28.8 million; and the Department of Public Health, $11.6 million.

Current post-secondary education appropriations are as follows:

University of Alabama in Tuscaloosa – $120.6 million;

University of Alabama at Birmingham – $213.9 million;

Alabama A&M University – $26.8 million;

Alabama State University – $27.6 million;

Athens State University – $8.95 million;

Auburn University – $134.2 million;

Jacksonville State University – $28.8 million;

University of Montevallo – $15.2 million;

University of North Alabama – $21.4 million;

University of South Alabama – $82.97 million;

Troy State University – $35.4 million;

Tuskegee University – $4.7 million; and

University of West Alabama – $9.4 million.

An 18 percent cut in the budgets of these colleges would result in the following budgets:

University of Alabama in Tuscaloosa – $98.9 million;

University of Alabama at Birmingham – $175.4 million;

Alabama A&M University – $21.9 million;

Alabama State University – $22.7 million;

Athens State University – $7.3 million;

Auburn University – $110 million;

Jacksonville State University – $23.6 million;

University of Montevallo – $12.4 million;

University of North Alabama – $17.6 million;

University of South Alabama – $68 million;

Troy State University – $29 million;

Tuskegee University – $3.9 million; and

University of West Alabama – $7.7 million.

If the $1.306 billion general fund budget were cut 18 percent, or $264.8 million, the budget would be $1.041 billion.

The legislative branch of the government currently receives $43.8 million from the state while the judicial branch, which includes the Supreme Court, receives $32.2 million.

With cuts of 18 percent, the legislative branch will receive $35.9 million and the judicial branch will receive $26.6 million.

Other appropriations in the general fund budget and their cuts include:

The Department of Agriculture & Industries, currently $13.9 million cut to $11.4 million;

The Department of Corrections, currently $233.98 million cut to $191.9 million;

The District Attorney’s Association, currently $26.9 million cut to $22 million;

The governor’s office, currently $2.8 million cut to $2.3 million;

The Department of Public Health, currently $59.3 million cut to $48.6 million;

The Department of Human Resources, currently $72.9 million cut to $59.8 million;

The Alabama Medicaid Agency, currently $222 million cut to $182.1 million;

The Department of Mental Health, currently $96.8 million cut to $79.4 million;

The Department of Public Safety, currently $63.8 million cut to $52.3 million;

The Bureau of Tourism and Travel, currently $2.3 million cut to $1.9 million;

The Department of Youth Services, currently $17.1 million cut to $14 million;

Elections expenses, currently $5.3 million cut to $4.4 million;

The Employee Suggestion Incentive Program, $482,500 cut to $395,650;

The governor’s proclamation expense, currently $1.3 million cut to $1 million;

Registration of voters, currently $3.3 million cut to $2.7 million;

The Administrative Office of Courts, currently $7 million cut to $5.7 million;

The Department of Corrections, currently $5.2 million cut to $4.3 million; and

The State Docks, currently $3.5 million cut to $2.9 million.

Cuts of 18 percent in both the education trust fund and the general fund will create some $1.029 billion, just short of what has been estimated as the shortfall in this year’s budget