2012 Alabama Trust Fund referendum

The 2012 Alabama Trust Fund referendum was a statewide special election held on September 18, 2012 to ask voters to authorize, through an amendment to the Alabama Constitution of 1901, a $437.4 million transfer from the Alabama Trust Fund to the state's general fund to help balance state operating budgets for fiscal years 2013, 2014 and 2015. The referendum was requested by Governor Robert Bentley after the Alabama Legislature failed to pass any new spending cuts or revenue bills that would otherwise have made it possible to balance the budget. Without the "temporary funding bridge", Bentley warned that state spending for Medicare, courthouses, prisons and other areas would have to be sharply reduced. Bentley has pledged that the state will repay the borrowed amount, but the amendment's language includes no specific provisions for repayment.

The Trust Fund contains about $2.3 billion in investments, funded by royalties collected by the state from companies operating natural gas wells in state waters. The original amendment, as sponsored by State Senator Arthur Orr, a Republican from Decatur, would only have modified the procedure for regular payments from the fund into the state's general fund, and would have placed the issue on the regular November 6 general election ballot. After it passed the Senate, Representative Steve Clouse, Republican from Ozark, added language to approve three specific transfers of $145.8 million and proposed the September 18 date. The House passed Clouse's version, which was then approved in its revised form by the Senate. Clouse's office attributed the changes to a request from Bentley's administration.

The special election date was ostensibly so that there would be time for a special legislative session to be held, if necessary, before the beginning of fiscal 2013. Opponents reached the more cynical conclusion that the single-issue referendum would be more likely to attract only its supporters to the polls. The cost of holding the referendum was estimated at $3 million by the Alabama Secretary of State's office. Further criticism was leveled at the language of the ballot issue, which detailed the measure's intended effect as "...to prevent the mass release of prisoners from Alabama prisons, and to protect critical health services to Alabama children, elderly, and mothers...", without describing the exact amount to be taken from the Trust Fund or the changes to the method of determining regular distributions from it.

Major supporters of the bill included the Alabama Nursing Home Association and the Alabama Education Association. The "Keep Alabama Working" PAC, which campaigned on behalf of the amendment, reported nearly $1.2 million in contributions, mostly from the ANHA. Opponents included the Alabama Tea Party.

The board of trustees for the Alabama Trust Fund, chaired by Bentley, issued no opinion on the proposal. The non-partisan Alabama Policy Institute warned that passage of the amendment would take the pressure off the current legislature, but only at the cost of burdening future legislatures with the added cost of repaying the fund on top of existing obligations to the Alabama Trust Fund and Educational Trust Fund, and ever-increasing costs to fund mandated pensions, medical care and corrections.

Ballot language

Proposing an amendment to the Constitution of Alabama of 1901, to provide adequate funding for the State General Fund budget, to prevent the mass release of prisoners from Alabama prisons, and to protect critical health services to Alabama children, elderly, and mothers by transferring funds from the Alabama Trust Fund to the State General Fund beginning with the state's 2012-2013 fiscal year and concluding with the state's 2014-2015 fiscal year; to provide a new procedure for distributions made from the Alabama Trust Fund beginning 2012-2013 fiscal year; to create a County and Municipal Government Capital Improvement Trust Fund advisory committee; and to provide further for distributions made from the County and Municipal Government Capital Improvement Trust Fund. (Proposed by Act No. 2012-490)

Result

About 600,000 of Alabama's 2.67 million registered voters (22%) went to the polls. The proposed amendment was passed by a 2-1 margin. With 88% of precincts reporting, 357,036 "yes" votes outpolled 193,072 "no" votes.

References

• White, David (September 12, 2012) "Trust fund transfer referendum date to cost Alabama $3 million." The Birmingham News
• White, David (September 19, 2012) "Alabama voters provide 2-1 approval of referendum to shore up General Fund with cash from trust fund." The Birmingham News

External links

• certified ballot language from sos.state.al.us
• Guide to the Issues by the Alabama Policy Institute
• Alabama Medicaid Amendment at ballotpedia.org