ATLANTA -- The Alabama Legislature and Gov. Guy Hunt have finally ended their budget deadlock, agreeing to a compromise plan that limits general fund spending in fiscal 1992 to $815.1 million.
The new budget, passed late Friday in a special legislative session and later signed by the governor, comes two weeks before the new fiscal year starts Oct. 1 -- and just five weeks after Gov. Hunt vetoed an $806 million general fund budget approved by lawmakers during the regular session.
In vetoing the original plan, the governor said he wished to restore about $25 million in funding for law enforcement and mental health programs that had been slashed by the lawmakers. He later proposed that money for these programs come from an increase in cigarette taxes by 8 cents a pack, to 24.5 cents.
Although lawmakers rejected the cigarette tax, they undid most of the funding cuts Gov. Hunt had fought. This was achieved by drawing off $9.7 million from various sources, including $4 million from the state's abandoned-property account, $2.3 million from the Alcohol Beverage Control Board, and $1.3 million from the Public Service Commission.
In addition, the governor will now have $4.1 million in a discretionary spending account, $2 million more than in the vetoed budget.
"The Legislature's decision to increase the budget for prisons and public safety certainly indicated that we were right on track about the budget that was passed during the regular session," Gov. Hunt said in a Saturday radio address. "I am grateful for that support . . . but the failure to approve even better funding is troubling."
When added to the $3.46 billion of earmarked money available for state spending, such as gas tax revenues, the new general fund budget will raise the 1992 operating budget to $4.28 billion, a 12.3% increase over the current fiscal year.
Even though the budget has now been passed, lawmakers still have some more legislation to consider in the special session -- including a $25 million bond issue for prisons -- and will return on Monday, Sept. 23, for a final day of deliberations.
Later this year, another special session could be called that could have a large impact on state spending. Lawmakers and Gov. Hunt have discussed increasing the state's tax on gasoline to help fund $5.5 billion in highway improvements over 20 years. More than 2,300 miles of roads would be expanded to four lanes and new roads would be built throughout the state.
A proposal endorsed by Gov. Hunt to raise the gas tax by 7.5 cents a gallon to fund the plan was defeated earlier this year during the regular session. Some Democratic lawmakers have said Alabama should sell tax-exempt highway bonds if the gas sales tax increase is approved. The governor, however, does not favor this approach.
A spokeman for Gov. Hunt said he has made no commitments about calling a special session, but would discuss the matter with legislators before making a recommendation.
Alabama's general obligation debt is rated Aa by Moody's Investors Service and AA by Standard & Poor's Corp. The state currently has $587.7 million of tax-supported debt.
