LEGISLATURE PASSES BUDGETS; GOV. RILEY OFFERS CHANGES
MONTGOMERY, Ala.-- Legislators approved state budgets Thursday afternoon, but Gov. Bob Riley returned the General Fund budget with suggested changes. Those changes would affect when agencies that received budget cuts would receive their funding and how layoffs would be conducted, if necessary. The new budget year for the state begins Oct. 1.
The Legislature passed a $4.238 billion Education Trust Fund budget, a decrease of one-fourth of one percent from last year. That budget allocates money for schools. They also passed a $1.2 billion General Fund budget, a decrease of 5.23 percent from last year. That budget allocates money for public services.
At the beginning of the special session, Gov. Riley proposed a state budget that applied cuts ranging between 10 percent and 18 percent to most state agencies. Riley's budget proposal would have cut funding to the Alabama Department of Agriculture and Industries by 32 percent and funding to the Alabama Forestry Commission by 45 percent. All non-state agencies, such as museums, economic development organizations and several education line-item appropriations, were cut completely out of Riley's proposed budget.
Also during the special session, bills were introduced that would have eliminated all sales tax exemptions, including those for agricultural input items, and would have reduced premium tax credits for insurance companies. Neither of those bills made it out of their assigned committees.
The initial budgets in each chamber were passed Tuesday, but legislators made several changes to the budgets proposed by Gov. Riley. The most notable change was the restoration of 25 percent of the funding the governor had proposed to eliminate for non-state agencies. Wednesday, the budgets were swapped, with committees in each chamber making slight additional changes.
Legislators restored some funding that Riley had proposed to cut from the Department of Agriculture and Industries' budget. Several line items in that budget that the governor sought to cut were partially restored, including funding for the Fire Ant Eradication Program which was funded at 82 percent of the 2003 level. Other items that were funded at 25 percent of last year's level included the diagnostic labs at Hanceville and Snead and the state climatologist. Restoring partial funding for some line items in the department's budget reduced overall cuts from an estimated 32 percent to 18 percent.
Riley's proposed cuts of 45 percent to the Alabama Forestry Commission's budget were tapered to 34 percent by legislators. However, cuts for funding for rural and community fire protection, a division of the Forestry Commission, were still included in the budget. Rural and community fire protection funding was reduced from $2.483 million last year to $1.242 million this year.
In the General Fund budget, legislators restored 50 percent funding for the Soil and Water Conservation Districts in Alabama. Gov. Riley had eliminated all funding for the districts in his budget proposal.
A total of $350,000 previously earmarked in the General Fund budget for the Alabama Department of Environmental Management's Confined Animal Feeding Operations program was not included in Gov. Riley's budget proposal. However, legislators restored partial funding for the CAFO program to $87,500, or 25 percent of the former amount.
"This reduction in CAFO funding may delay permitting fee requirements for farmers for at least 90 days," said Paul Pinyan, director of Agriculture Legislation for the Federation. "And if no additional appropriations are approved, this could initiate permitting fees that will be paid for by farmers. The cost for the average producer would be an estimated $475 annually, and could not exceed $925 per farm, per year."
"We expect both these bills to be reintroduced as part of a revenue package during the next regular session starting in February," said Federation Governmental Affairs Director Patterson. "It's imperative that our members continue to make their opposition to these bills known to their local legislators."
Perhaps the most fierce debate during the special session came in the House, with legislators trying to avoid eliminating their discretionary grant money. The money, often referred to as Community Service Grants, normally is spent by legislators for educational purposes. In recent years, each senator received a minimum of $109,000 and each representative received at least $54,440. In the budget process, neither senators nor representatives changed the total budget amount proposed by the governor.
While legislators had their Community Service Grants eliminated from the budget, the governor's contingency fund, which is money he can use for office expenses or special projects, was reduced by only 18 percent to $252,347.
In the debate over the budgets, Rep. Robert Bentley, R-Tuscaloosa, showed the apparent frustration of many legislators.
"It's apparent that somebody is intent upon inflicting pain in order to raise taxes, and that is very wrong," Rep. Bentley said.
In a rare move Thursday morning, the Senate agreed to send both budgets to the governor without appointing a Joint Legislative Conference Committee to iron out the differences between its budgets and the budgets approved by the House.
"This gave the governor the option to veto the budgets, and could have forced legislators to accept his original proposals," said Patterson.
Legislators passed the Accelerated Parole and Felon Voting Rights legislation during the special session which provides for the early release of thousands of prisoners and the addition of more former felons to Alabama's voting rolls. The bill passed the Senate 21-11 on Wednesday after clearing the House 47-42 on Monday.
The bill now goes to the governor, who is expected to sign it into law. The bill would expand Alabama's parole board from three to seven members so that it could have two three-member panels to review cases, with one alternate.
During the special session, legislators created an advisory board to assist the Alabama Department of Environmental Management Commission in addressing underground storage tank cleanup. No adverse changes are anticipated for farmers, Pinyan said.
Budget Highlights (Subject to governor's signature)
Highlights of the $1.2 billion General Fund budget for fiscal 2004:
- Reduces funding for courts, the attorney general and district attorneys 10 percent below this year.
- Cuts funding for most other non-education agencies, including the governor and state troopers, 18 percent below this year.
- Reduces funding for the Medicaid program by 1 percent to $220 million.
- Increases funding for the state prison system by 7 percent to $250 million.
- Increases funding for the state mental health system by 1 percent to $98 million.
- Eliminates 75 percent of the funding for non-state programs, such as food pantries, domestic violence shelters, and Junior Miss pageants.
- Reduces the governor's contingency fund, which is money he can use for office expenses or special projects, by 18 percent to $252,347.
- Includes one-time money from the federal government tax cut that won't reoccur in fiscal 2005.
Highlights of the $4.2 billion Education Trust Fund budget for fiscal 2004:
- Funds K-12 teachers at the same level that the school systems had during the 2002-03 academic year.
- Removes all community service grants funds that legislators formerly received for special projects in their districts.
- Reduces textbook funding from $42 million to $5.2 million. However, this is enough to provide workbooks for kindergarten through the second grade.
- Removes funding for library book purchases and computers for public schools.
- Cuts funding from $6.8 million to $4 million for the High Hopes program, which helps students having trouble passing the high school graduation exam.
- Reduces funding for most non-state programs, including museums, arts programs, and the Alabama Sports Festival, by 75 percent.
- Provides private schools and colleges with 50 percent of the money they received in last year's budget.
- Provides public universities about the same amount they received this year.
- Reduces the Alabama Student Grants program, which provides tuition assistance to Alabama students in private colleges in the state, from $5.3 million to $1.8 million. Students who normally get about $600 per year in tuition assistance would get one-third that amount.
- The budget does not repay any money taken from the state's Rainy Day Fund earlier this year to keep the current education budget from going into proration.
- Includes one-time federal money resulting from the federal tax cut that won't reoccur in fiscal 2005.