With lottery dead, Alabama lawmakers focus on BP oil spill funds

Alabama State Capitol

Alabama lawmakers will focus on legislation dividing the state’s nearly $1 billion in oil spill settlement money when they resume a special session Tuesday on Medicaid funding.

With lottery legislation dead for the session, the bill takes center stage as the only option before lawmakers to get additional money to the state’s Medicaid program. Legislators are deadlocked over the best use of the money intended to compensate the state for economic damages suffered during the 2010 oil spill in the Gulf of Mexico. They have been split over how much to use for building roads in coastal counties and how much to use for paying state debt and funding Medicaid.

“I’m not real optimistic. You are going to have a group that is very forceful about using the money for debt repayment and/or Medicaid. And you have a group that is willing to lock it down on getting money to south Alabama,” Senate President Pro Tem Del Marsh, R-Anniston, said.

The Alabama Senate on Tuesday will resume debate on a House-passed plan that would use the BP money for debt payment and roads. Marsh said if lawmakers can’t reach an agreement Tuesday, there could be a sentiment to go ahead and end the special session Tuesday instead of returning for the final two days.

Alabama’s general fund is getting $1 billion over the next 18 years, under the state’s settlement with BP. Under the bill, the state would take a smaller amount of the remaining $850 million in payments up front — a projected $640 million— by doing a bond issue. About $450 million would be used for paying back money borrowed during past budget shortfalls and $191 million would be used for two state road projects in coastal counties. Paying debt early would free up about $70 million in help fill a projected $85 million hole in next year’s Medicaid budget.

Lawmakers from south Alabama have been adamant that won’t take less, or at least not much less, for the road projects.

Sen. Bill Hightower, R-Mobile, said coastal Alabama suffered the brunt of the damage from the oil spill and should get more benefit from the money.

“The money is there because the oil spilled along the coast. That’s where the damage occurred,” Hightower said.

Other lawmakers have said they want to see more money go to the state’s Medicaid program, arguing south Alabama received its own direct compensation funds from BP.

Sen. Arthur Orr, R-Decatur, said the problem is not just next year’s Medicaid budget. He said Medicaid is facing “catastrophic shortfalls” in 2018 and 2019.

“I think it is extremely important we try to address Medicaid funding shortfalls anticipated for 18 and 19,” Orr said. “There will be definitely some alternative offered that would support Medicaid significantly over a three-year period.”

Sen. Trip Pittman, R-Montrose, introduced an amendment to reduce the road money by $15 million and send it to Medicaid.

“That should give the $85 million that Medicaid needs next year,” Pittman said.

Hightower said the Pittman amendment would be acceptable, but it is unclear if the additional few million would be enough to bridge the deep divisions in the Senate.

Gov. Robert Bentley brought lawmakers into special session to consider a lottery bill and other means to get money to the state’s perpetually cash-strapped Medicaid program.

“Lottery is dead so it’s all BP now,” Rep. Steve Clouse, chairman of the House Ways and Means Committee, said.

Pittman said lawmakers, after propping up budgets in past with borrowed money, eventually have to make a choice: Raise revenue or make cuts.

“You have to do one or the other,” Pittman said.

Republished with permission of the Associated Press.


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