House considers diverting BP funds to coastal road projects

This week the State House is considering a bill that would divert 40 percent of Alabama’s $1 billion settlement with BP to Mobile and Baldwin counties while still repaying debt and funding road projects throughout the state.

Proposed by Sen. Bill Hightower (R-Mobile), SB 267 would split the settlement 60-40, leaving 60 percent in the state’s General Fund and moving roughly $260 million to road projects in the area. It passed the Senate 30-5 April 5.

Noting cities as far north as Huntsville won judgments against BP for lost revenue, Hightower claims his bill is “the right way to compensate” coastal communities and make up for RESTORE Act funding that was was ultimately half of what was originally expected.

“I talk to people who say, ‘the South has already gotten all their money. They’ve already filed suit,’” Hightower told Lagniappe. “Well, everybody in the Northern part of the state filed suit too, but we’re the ones who had to deal with economic and environmental damages, which were significant.”

In BP’s settlement, Alabama is scheduled to receive yearly payments of $53 million through 2033, but Hightower’s bill would issue revenue bonds based on that income to generate more than $650 million immediately.

Excluding the $260 million earmarked for Mobile and Baldwin counties, the remaining $229 million would be split between the five districts of the Alabama Department of Transportation for road projects. The bill also pays back the $161 million borrowed from the state’s “rainy day” fund and sets aside $5 million for grant programs subsidizing the cost of roof fortification and hurricane insurance for homeowners.

Hightower shared a breakdown of his bill with Lagniappe that can be viewed below:

Originally, Hightower laid out specific road projects in the legislation but said he had to remove those for “broader acceptance” of the bill. Now, Rep. Randy Davis (R-Daphne) is on tap to carry a joint resolution directing the money toward expansion projects on U.S. Highway 98, the Baldwin Beach Express and Rangeline Road.

Hightower said expanding Highway 98 and the Beach Express would alleviate congestion and address safety concerns while the Rangeline Road projects would set up automotive export capabilities at Alabama’s state port in Theodore. According to Hightower, all three would have an economic impact on the region.

“We’ve got oystermen and shrimpers that won’t come back into business as a direct result of the spill,” Hightower said. “It’s hard to say when we’re fully compensated, but I think this really goes a long way. If we’re helping the region prosper, we’re helping the people prosper.”

Moving into the House, Hightower said, any bill can expect “some opposition,” but he said he can’t see his “colleges in North Alabama [turning down] $240 million in road projects in and around their districts.”

Adding those projects has already won the bill support from House Speaker Mike Hubbard and Alabama Gov. Robert Bentley, who has been critical of the Legislature’s plan to use BP funds to pay “routine debt” in the 2017 budget.

“We’re going to just squander that money if we don’t put it aside for projects in this state. It’ll just be gone, and we won’t get any benefit from it,” Bentley said last week. “[That’s] the reason it’s so important we pass this bill and get it in this form. Now we’ve got to get it through the House and we’re going to be in good shape.”

While Hightower said he appreciates Bentley’s support, he doesn’t necessarily need it. As a constitutional amendment, SB 267 won’t require the governor’s signature if it survives the House.

Updated on April 27, 2016: In the original version of this story, Alabama Rep. Randy Davis was incorrectly identified as a Senator.