Brian Lyman

Montgomery Advertiser

A Senate committee has approved a $1.8 billion General Fund that started as the House version and ended with 3.4 percent cuts in most state agencies.

The budget goes to the full Senate. The cuts -- which came from a late amendment proposed by Sen. Paul Sanford, R-Huntsville -- would come out of state agencies to move $63.5 million a year in funding to the Alabama Department of Transportation for the Highway Trust Fund.

"We'll see," said Senate Finance and Taxation General Fund chairman Trip Pittman, R-Montrose, asked after the meeting if the proposal would survive.

The late amendment added an unexpected twist to what to that point had been a discussion of a flat budget that reflected legislators' concerns about possible changes to federal funds. Pittman said the need to save money for potential changes to federal funding, combined with limited revenue in the budget,led to level-funding, and suggested to colleagues that they being thinking about next year's budget.

"For planning purposes it might be helpful to look at this as a two-year budget," he said. "If it’s hard to not give a pay raise and bonuses in an election year, it’s even harder to raise taxes."

The always-troubled General Fund budget -- plagued by flat revenues and rising costs -- demands caution, but legislators are lightening their steps even more amid questions about federal funding. In addition, the Alabama Medicaid program, the keystone of health in the state, will lose $105 million in one-time money from BP’s settlement of claims over the 2010 Gulf oil spill.

Sanford described his amendment as a way to address existing needs in the state's infrastructure without raising the state's gas tax, which supports roadwork around the state. The tax has not gone up since 1992, but efforts to raise it last month collapsed in the House of Representatives. He acknowledged Wednesday the amendment diverting the money -- which goes to fund courts and other needs -- might not survive.

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"I've argued we didn’t need to transfer the money away, that you needed to address the other needs differently," he said. "Rather than do that, they’re proposing a gas tax, basically slightly more than that would be."

But cutting departments like Corrections -- which faces federal lawsuits over the medical and mental health treatment provided to prisoners -- could land the state difficult legal territory.

"Money’s tight everywhere," Senate President Pro Tem Del Marsh, R-Anniston. "I reserve the right to see the effect and talk to the chairman about it."

The House version of the budget, passed in March, set aside about $97 million to address the loss of BP money or – if needed – to pay for possible changes to other programs, such as an increased match for the Children’s Health Insurance Program (CHIP). The Senate reduced the carry forward to $95 million.

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Prior to the Sanford amendment, the $1.843 billion budget kept current spending levels. The House provided $3.3 million to the Alabama Law Enforcement Agency (ALEA) to hire an additional 30 state troopers, and also allocated money for modest boosts to the Alabama Department of Environmental Management (ADEM) and the Forestry Commission. Pittman said the money for ALEA remained in the Senate version and that the ADEM increase also remained in place. He did not specify the amount of the incrasse.

Gov. Robert Bentley's budget proposal in February provided a four percent cost of living raise to state employees, who have not had a COLA increase since 2008. House leaders dropped the proposal, citing concerns over Medicaid. Attempts by Democrats and Republicans in the River Region to restore the increase or offer a bonus to state workers failed during the floor debate March 14.