MONTGOMERY, Ala. — On Friday, the Alabama House of Representatives passed a bill that will establish the distribution of funds the state received as a result of the 2010 BP oil spill.
The bill, which passed 82-12, is seen as a compromise and could potentially prevent cuts to the state’s medicaid program next year.
According to the provisions of the bill, the Alabama General fund will receive an estimated $639 million through a bond issue. This is instead of the initial plan to pay out $1 billion over 18 years.
Of the new sum, the funds would be distributed in the following portions:
• $450 million for debt payment
• $191 million for road projects in coastal counties
According to House Budget chairman Steve Clouse (R-Ozark), paying debts off early clears up $70 million of the $85 million Medicaid needs to avoid service cuts in the upcoming fiscal year.
The BP Oil Spill settlement was finalized last year. The overall settlement of $1 billion was:
• $950 million Paid by BP to the Alabama General Fund:
• $50 million each of the years 2016-2019
• $53.33 million in each of the years 2019-2033
• $50 million paid by BP in 2016 to the Alabama Gulf State Park Project
While Attorney General Luther Strange (R-AL) and others celebrated the agreement, Congressman Bradley Byrne (R-AL1), whose district encompasses Alabama’s gulf coast, Tweeted that he was still “frustrated” by the deal.
Byrne and other state representatives from Alabama’s Gulf Coast region have been consistently of the opinion that the majority of the funds should be disbursed to the local counties most effected by the disaster.
RELATED: Alabama’s coastal communities feel BP oil spill settlement is a ripoff
“We need the state Legislature to remember two facts,” said Mobile Mayor Sandy Stimpson last fall. “One is that there were real economic and environmental consequences from the oil spill which continue to this day. The second is that our region is a tremendous economic engine for the entire state. Returning more of the settlement to coastal Alabama is not only the right thing to do, but it is also good common sense.”
Yellowhammer reached out to Rep. Clouse after the bill was passed. Clouse said, “The BP oil settlement bill will pay off 80 percent of the state debt to the oil & gas trust fund, fund road projects in coastal Alabama and give a boost to the state’s Medicaid program for fiscal year 17.”
“I know some folks think other parts of the state are being short changed, but the money borrowed from the trust fund in 2010 & 2012 benefited the entire state. We need to make sure it is paid back,” Clouse added. “This is a fair settlement and I hope the Senate concurs.”
Today’s bill has been seen as the middle ground between the original plan and the alternative posed by those on the coast. The funds, although not perfectly split, are more closely divided than the original disbursement. The senate has two days to pass the bill.
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