SB414 Alabama 2012 Session

Summary

Primary Sponsor

Hank Sanders

Democrat

Session

Regular Session 2012

Title

Alabama Trust Fund, unrealized capital gains, oil and gas capital payments received during fiscal year, excluded from the calculation, clarified, realized gains from a public exchange traded equity asset, purchased and sold in same fiscal year, calculation method established, Amendment 666 (Section 219.04, Recompiled Constitution of Alabama of 1901, as amended), am'd., const. amend.

Summary

A constitutional amendment to boost bonding authority, redirect oil and gas payments to new capital-improvement funds, require diverse bidders for bonds, and repeal a prior amendment if approved by voters.

What This Bill Does

If passed, the amendment would increase the total amount the state can borrow with general obligation bonds and allow debt service to be paid from increased oil and gas capital payments deposited into dedicated trust funds. It would specify that portions of oil and gas payments go into two special funds for County/Municipal and Alabama capital projects. It would require bond sales to be by public bidding with the lowest true interest cost and mandate contracting with diverse Alabama businesses for bond-related work. It would repeal Amendment 796, while keeping any bonds already authorized under it valid, and require a public election for approval.

Who It Affects

• Voters in Alabama, who would decide by election whether to approve the constitutional amendment.
• Bond Commission, Governor, Director of Finance, and Commissioner of Revenue, who would manage and oversee bond issuance and debt service.
• Oil and gas producers and the Alabama Trust Fund, since a portion of Oil and Gas Capital Payments would be diverted to new capital improvement trusts.
• Counties and municipalities, as funds would be allocated to their dedicated Capital Improvement Trust Fund for local projects.
• Construction and contracting firms in Alabama, which would bid on bond-related work and be selected in part to reflect the state's racial and ethnic diversity.

Key Provisions

• Increases the bonding authority under Amendment 666 for General Obligation Bonds and sets a specified maximum aggregate principal amount for new bonds.
• Requires a portion of Oil and Gas Capital Payments paid into the Alabama Trust Fund to be deposited into two dedicated Capital Improvement Trust Funds (one for County/Municipal Government projects and one for Alabama state projects) to support debt service.
• Finances and issues General Obligation Bonds through the Bond Commission via public sale or auction, using the lowest true interest cost, with issuance expenses contracted to reflect Alabama's racial and ethnic diversity.
• Repeals Amendment 796 (Section 219.041) of the Constitution but preserves the validity of any bonds already authorized under it.
• Calls for a statewide election to approve the proposed constitutional amendment.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Constitutional Amendments