The long-forecast crisis has become a reality. Alabama faces a financial plight that threatens most every aspect of government. That means the welfare of Alabama citizens is at stake.
The Alabama Legislature must find between $500 million and $700 million of new money this year just to stay even. If the money is not found, schools could face a 6-percent cut according to Gov. Bob Riley. Other state agencies supported by the General Fund could be cut by 18 percent.
The present financial predicament is not the result of a sluggish economy alone. It is the result of a fundamentally flawed tax policy that has hung like an albatross around the neck of Alabama for generations.
That is one reason Alabama Baptists two years ago adopted a resolution which, in part, called upon “the governor and the state legislature to develop and implement appropriate tax reform.”
If one has lived only in Alabama, one may think state taxes are high. Alabamians who have lived elsewhere know they are not. Alabama taxes are among the lowest in the nation. It has often been pointed out that Alabama property taxes could be doubled and we would still have the lowest property taxes in the United States.
Among the 10 states usually included in the southeastern region, Alabama is 10th in total state and local tax revenue on a per capita basis. If the 10 states all had the same population as Alabama, the current tax rates would give seven of them more than $1 billion in tax revenue than Alabama. The other two, Mississippi and Arkansas, would have about a half-billion dollars more, according to a study done by the Public Affairs Research Council of Alabama.
In education, Alabama ranks ninth in support for elementary and secondary education on a per-capita basis. Our annual outlay is $823. Kentucky, which is number 1, invests $1,031. When tax revenue invested on a per-student basis is considered, Alabama ranks eighth with an expenditure of $4,940 per student. Of these 10 states, only Mississippi and Arkansas trail us. Kentucky makes the largest investment with $6,426 per elementary and secondary student.
In higher education, Alabama again trails the pack. Our investment per student in two-year institutions — $3,668 — places Alabama eighth in the southeast. Investment per student in four-year schools is even worse. There the state is ninth with an outlay of $4,871 per student.
Expenditure in corrections places Alabama last, even though the state is fourth among southeastern states in the number of inmates per 1,000 population. Alabama spends $47 per capita in corrections. That is less than half the amount spent by South Carolina, North Carolina and Florida. On a per inmate basis, Alabama is again last. Eight other southeastern states spend about twice as much or more on corrections.
Even caring for the environment suffers. General Fund support for protecting the water, air and land in Alabama is $1.36 per capita. In Florida, that figure is $18.51; in Tennessee, $9.59; in Georgia, $4.64.
Data from the U.S. Department of Transportation showed the number of vehicle-miles traveled on Alabama highways ranked second among the 10 southeastern states. The allocation of tax dollars to highways per 1,000 vehicle-miles traveled, placed Alabama eighth.
The Centers for Medicare and Medicaid Services information shows Alabama ranked eighth among the southeastern states in per capita outlay for Medicaid. Alabama spends $191 per capita. Tennessee is first with $334.
By practically every indicator, Alabama continues its nearly 80-year-old policy of low taxes and low public investments in state structures. The result is a state in crisis. Court decisions dictate many state actions, infrastructure is overtaxed and parts of Alabama live in conditions described as “third world.”
A recent poll indicated that most Alabamians believe “eliminating waste in state government” could solve the budget problems. It will not. But that conclusion does indicate a starting point. Until the state legislature cleans up its own act, it is unlikely Alabama voters will ever approve the major changes needed in the state’s tax structure.
Stories about legislators using nearly $60 million for pet projects during an election year undermine faith in the legislature and make one question the seriousness of the current crisis. It is hard to understand a crisis exists at all when those charged with exercising the public good siphon off an amount equal to 10 percent of the need through discretionary accounts, community service grants and other items called “pass-through pork.”
Another recent poll indicates that Alabama voters are willing to support higher taxes once they are convinced that waste has been eliminated. For the sake of Alabama, it is incumbent that our elected officials lead the way in solving our fiscal problems. It is time to eliminate waste from government, including all the private accounts legislators use to enhance their re-elections. It is time for “the governor and the state legislature to develop and implement appropriate tax reform” as the Baptists of this state have urged.
The welfare of Alabama and the welfare of Alabama citizens is at stake.
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