Alabama lawmakers try to break deadlock on BP oil spill money

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Alabama lawmakers on Wednesday made a last-ditch effort to break a deadlock on how to spend the funds from a settlement related to the 2010 oil spill in the Gulf of Mexico.

A conference committee attempted to strike a middle ground between lawmakers who want money for road projects in coastal counties and others who want to steer money to the state’s cash-strapped Medicaid program. The House of Representatives approved the conference committee’s plan on an 87-9. It now moves the Alabama Senate where divisions among senators are sharper.

“This is possibly, at this point in time, the best that we are going to be able to do. There was compromise on all sides,” Senate President Pro Tem Del Marsh, R-Anniston, said.

Alabama is set to receive $850 million in compensation for economic damages from the largest offshore oil spill in U.S. history. State lawmakers are considering taking a smaller amount up font — a projected $640 million — by doing a bond issue. But first they must agree on how to use the money.

Lawmakers have been deadlocked over how much of the money to use for debt payment, Medicaid or road projects.

The proposed compromise would steer $120 million to south Alabama road projects and $120 million to Medicaid over the next two years. It would also use $400 million to repay money borrowed from other state coffers during past budget shortfalls.

The House had initially approved a bill that would have steered $191 million to road projects in Mobile and Baldwin counties,

Some senators in both parties argued Wednesday the state should put more money to the state’s struggling Medicaid program. Sen. Arthur Orr, R-Decatur, said Medicaid could need an additional $200 million or more in coming years, and the settlement funds were the best hope to help fill that funding gap.

Sen. Rodger Smitherman, D-Birmingham, said the plan gave “crumbs” to the Medicaid program while lawmakers were fixated on building projects and paying interest-free debt.

Senators are expected to debate the bill through Wednesday afternoon.

Gov. Robert Bentley brought lawmakers into special session to debate a proposed state lottery and other ways to try to get additional money to the state’s perpetually cash-strapped Medicaid program. With the lottery bill dead for the special session, the oil spill settlement bill took center stage in the final days of the special session.

Marsh said lawmakers risked getting no additional money for Medicaid if they end the special session without approving the bill.

Republished with permission of the Associated Press.

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