Identical American Rescue Plan Act spending bills are circulating in the Alabama House and Senate, and a public policy group said the state isn’t doing enough for its citizens.
Senate Bill 1, sponsored by Sen. Greg Albritton, R-Chatom, and House Bill 1, sponsored by Rep. Steve Clouse, R-Dothan, were introduced during Wednesday’s special session called by Gov. Kay Ivey.
The bills focus on how the state would spend its share of $443 billion in federal funding over the next four years. Each bill would provide for investments in broadband infrastructure, health care, supporting clean water initiatives, replenishing the Unemployment Compensation Trust Fund, and bolstering workforce development.
However, the Alabama Policy Institute said it would prefer direct relief to state residents when it comes to determining how the federal funding will be spent.
“I think they are missing the point,” said Justin Bogie, senior director of fiscal policy at Alabama Policy Institute. “They are not looking at ways to lower taxes for citizens. The state is in a big rush to spend the money. They are going to do something in the next week or two, and they have until December 2024 to spend it. Why are they in such a hurry to spend it? CARES Act funding sat for six months, and they didn’t spend it in any way during that period.
“The real story is lack of an effort by Alabama to look at cutting taxes in any way. The state saw record revenue in 2021 with over a $1 billion revenue surplus. There are a few minor tax cut bills that came out, but nothing that looks at cutting income taxes.”
The bills would call for the state to spend $443 billion of Coronavirus State Fiscal Recovery Funds with $80 million supporting health care and related services through a reimbursement package, and an additional $51 million to support broadband expansion.
“I think everyone in Alabama agrees broadband expansion is important,” Bogie said. “They are spending $276 million on broadband, and that is not going to do anything in a meaningful way. It is gonna take $4 to $6 billion to get Alabama where it needs to be on broadband.”
The bills would also call for up to $225 million to be spent on clean water initiatives with investments in water and sewer infrastructure, and another $120 million allocated for grants to water and sewer systems for high-need projects. Plus, an additional $100 million would be used for matching grants for public water and sewer projects.
The unemployment fund would see a $79.5 million investment, which would reduce rates on employers for 2022 and return it to a fund balance close to what it was before the pandemic began.
The bills would also provide for a $30 million investment in rural hospitals, and an additional $5 million to expand and use telemedicine. An additional $20 million would support emergency responders, including firefighters and ambulance services.
The bills also would create a Joint Legislative Oversight Committee, which would oversee how the funds are spent. The board would be created within 30 days of the bills’ passage.
