MONTGOMERY — A bond issue worth $1.25 billion that would finance school improvements across Alabama cleared an important hurdle on Tuesday when it received a favorable report from the Alabama House Ways and Means Education committee.
The legislation was sponsored by State Sen. Arthur Orr (R-Decatur) and would constitute the largest state investment in school facilities since 2007.
Orr’s bill creating the bond issue passed the Senate unanimously earlier this week and has co-sponsors on both sides of the aisle.
The prospect of creating such a program had been a priority for many state leaders coming into the 2020 session. Governor Kay Ivey proposed a $1 billion version in her State of the State address in January.
The bill was first introduced by Orr on February 27 and amended this week by a proposal from Senate Pro Tem Del Marsh (R-Anniston) to be $1.25 billion.
Over 80% of the money would be spent on K-12 schools, with the rest composing significant investments in state universities and community colleges.
The state would make payments of over $80 million dollars yearly for two decades to retire the bond issue.
The interest rates on bonds have plummeted during the pandemic, making the financial prospects of issuing bonds even more attractive from a financial perspective.
State budget expert Kirk Fulford said at the House Ways and Means Education committee meeting that the proposed bond issue would likely cost the state $400 million less than a similar measure that was taken in 2007.
Committee Chairman Bill Poole (R-Tuscaloosa) spoke favorably of the issue, saying rates were “as low as they’re ever going to be.”
The only criticism of the effort came from State Rep. Jamie Kiel (R-Russellville), who said he would like to see more of the funding be targeted at schools in impoverished and rural areas of the state.
Kiel said the current formula for dispersing the money would mean schools in well off areas that already had “astroturf and jumbotrons” would be rewarded as much or more than schools forced to use buckets to catch water from their leaky ceilings.
Poole, Kiel and other representatives agreed to meet after the committee adjourned to discuss proposals for altering how the money is disbursed.
Henry Thornton is a staff writer for Yellowhammer News. You can contact him by email: [email protected] or on Twitter @HenryThornton95
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