SB431 Alabama 2012 Session

Summary

Primary Sponsor

Paul Bussman

Republican

Session

Regular Session 2012

Title

Public School and College Authority, bonds, issuance of $1,070,585,022 billion for capital improvements for schools, colleges, other institutions, state agencies, and job training, revenue appropriated and pledged from utility gross receipts and service tax and sales and use tax with certain conditions, refunding bonds authorized, tax exemption provided from all state taxes and provision for federal income tax exemption, distribution formula provided, Education Facilities Excellence Act

Summary

SB431 would authorize the Alabama Public School and College Authority to issue about $37.8 million in bonds to fund capital repairs for tornado-damaged schools, with debt paid from specific state tax revenues.

What This Bill Does

It authorizes the sale and issuance of additional bonds to fund capital improvements for schools affected by the 2011 tornadoes. Debt service would be paid from designated portions of utility gross receipts tax, utility service use tax, and sales tax, with the bonds treated as limited obligations of the Authority rather than a state debt. The bill also allows refunding bonds, requires construction oversight by the State Building Commission, and specifies project allocations; it includes tax exemptions for the bonds and requires diversity in the Authority’s hires and contracting.

Who It Affects

• Listed local school districts and higher education facilities (e.g., DeKalb County Board of Education Plainview School; Franklin County Board of Education Phil Campbell High School; Marion County Board of Education Hackleburg schools; Tuscaloosa City Board of Education Alberta/University Place Elementary Schools; Tuscaloosa County Board of Education Holt Elementary School; Wallace State Community College - Hanceville) that would receive bond proceeds for capital improvements.
• The Alabama Public School and College Authority, the State Treasurer, the Governor, the State Building Commission, local boards of education, and taxpayers, since debt would be repaid from specified tax receipts, with the bonds exempt from state taxes and requiring ongoing oversight and budgeting adjustments.

Key Provisions

• Section 2: Allows the Authority to sell and issue $37,828,007 of additional bonds for capital improvements to tornado-damaged schools.
• Section 5: Pledges and irrevocable appropriations of residues from utility gross receipts tax, utility service use tax, and sales tax to pay debt service, creating a sinking fund; bonds are payable solely from these pledged revenues and not a general state debt.
• Section 6: Bonds are limited obligations of the Authority, not general obligations of the State, with security provided by pledged tax receipts.
• Section 7: Authorizes Refunding Bonds with financial safeguards, including a test that present value debt service is not worse than 95% of the debt being refunded and a limit on average maturity.
• Section 8: Proceeds must be deposited with the State Treasury and allocated to specific projects listed in the act; requires State Building Commission oversight and reimbursement of its costs.
• Section 10 & 12: Requires diversity in the Authority’s hiring and contracting; mandates public bidding and transparency in awarding contracts.
• Section 11: Grants authority to ensure interest on bonds remains exempt from federal taxation; matching investment agreements to maintain tax-exemption.
• Sections 13–14: Includes severability and immediate effective date provisions.

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

Subjects

Public School and College Authority