| BIRMINGHAM, Ala., Sept 19
BIRMINGHAM, Ala., Sept 19 Alabama voters
approved by two-to-one an amendment to the state constitution
allowing a transfer of $437 million from the state's trust fund
in order to avoid damaging budget cuts.
In a state-wide referendum on Tuesday, voters signed off on
an amendment that authorizes transfers from the $2.3 billion
state trust fund over three years that will go primarily to pay
for Medicaid healthcare and prisons.
Voters two years ago had rejected another proposal to take
$1 billion for roads and other infrastructure from the trust
fund, which takes in royalties from oil and gas drillers
operating off the state's coast.
Without the amendment, state agencies faced cuts of 10
percent or more that would devastated the prison system, which
already spends less per prisoner than most states, according to
Brian Corbett, spokesman for the Department of Corrections.
Budget cuts would have also badly stung the state's
healthcare providers, which are big employers, according to
In Alabama, more than 1 million people received at least one
service from Medicaid, spending on average $3,621 per year,
according to the Alabama Policy Institute. With a total impact
of $5 billion, a collapse of the Medicaid industry could have
sent healthcare providers scrambling to stay in business.
"Half of our revenues are from Medicaid," said Mike Warren,
chief executive of Children's of Alabama, a state pediatric
A coalition of more than 30 groups, from business leaders to
educators and prosecutors, supported the amendment through a PAC
called Keep Alabama Working. Without the cash injection into the
general fund, thousands of jobs could have been lost in the
state through drastic cuts, according to Rick Journey, the PAC's
Alabama's new general fund budget of $1.7 billion begins
Oct. 1, which spurred supporters of the amendment to rush a
statewide vote before November's elections.
With the first Republican majority in both houses of the
state legislature since the Civil War, policy makers strongly
opposed raising taxes to solve budget shortfalls. Republican
Governor Robert Bentley had vowed to veto any new tax bills.
"The amendment will give the General Fund time while we
continue our focused and resolute efforts to bring government
spending under control and restructure government programs for
better outcomes and effectiveness," said Senate Majority Leader
According to the governor, more than $675 million in
efficiencies have been found to save money.
The Alabama Trust Fund consists of invested assets from
payments on oil and gas leases in the Gulf of Mexico. The fund
annually makes deposits from the interest into the general fund.
Under the old rules, this year's transfer would have netted $62
million, woefully short of $145.8 million that will now be
transferred each year.