MONTGOMERY, Ala. — Alabama State Senator Paul Sanford (R-Huntsville) is offering his own solution to the general fund budget crisis, presenting the situation through an allegory, calling on Alabamians to have “a kitchen table conversation about your daily struggles and our state’s funding.”
Sanford asks Alabamians to imagine the following scene:
It is Sunday afternoon. Your family just finished a leisurely lunch, and you and your wife sit down with your two children to discuss family finances. You say, “This past month has been unusually hot and the A/C has seemed to run non-stop.”
The family utility bill is $100 more than you have traditionally been charged. Thankfully, the past few months have been going well, and you have saved $100 per month for a weeklong summer camping trip at the nearby state park on the lake. You just bought your two kids some much needed summer clothes and have no extra money to pay the utility bill, except the $100 you planned to put into the vacation fund.
“But we cannot use that money! It is supposed to be for our vacation,” blurts out of your son’s mouth.
“Yeah!” your daughter chimes in, obviously upset at the idea of using fun vacation money to pay the boring power bill.
Your wife calmly says the utility bill must be paid, or the family will have no power or A/C. “How about we cut our camping trip short by a day or two and use the $100 to make sure our house stays comfortable and cool?”
“I suppose that will be ok,” the kids reluctantly admit. “But we still get five days at the lake, right?”
Friends, our state budgets are experiencing a similar scenario. (Remember, Alabama has two budgets: one for education, and a General Fund budget for nearly everything else.) We have surplus dollars for one priority, education, but not enough money for other vital governmental functions like caring for the mentally ill.
We don’t need more revenue to fund state government – we need to fix the process by which we allocate the taxpayer money we already have.
The education budget passed this week gives more annual state revenue ($5.99 billion) to education than ever before. The next closest year that state revenues approached this level was fiscal year 2008 when education was funded at $5.94 billion (plus a surplus of $471 million from one-time transfers). At the end of September 2016, there is expected to be an additional $126 million going into the education stabilization fund created by the Rolling Reserve Act of 2010. This will be the first true deposit into the stabilization fund. Previous excess amounts have been used to pay back the ETF Rainy Day Account. Fiscal year 2016 is expected to bring $253 million more in excess funds that also would be deposited into the stabilization fund.
So less than eighteen months from today, on October 1, 2016 there will be an expected $379 million in a stabilization fund that we cannot use for the General Fund’s $230 million deficit. Are you seeing the similarities in my stories now?
Sanford goes on to argue that the state should dip into that stabilization fund instead of raising taxes, adding that “If the state were broke and needed more of your hard earned money via taxes, I would say that, but that is not the case.”
How would your kitchen table conversation end? Come discuss it with us in the comment section on Facebook.
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— Elizabeth BeShears (@LizEBeesh) January 21, 2015
