Alabama Senate Panel Wants $1B in Pandemic Relief for Infrastructure, Broadband

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Alabama lawmakers on Wednesday advanced a House-passed plan to use the state’s final $1 billion in federal pandemic relief funds largely on a mix of water and sewer infrastructure, broadband expansion and health care reimbursements.

The Senate Finance and Taxation General Fund Committee approved the bill after making a change to allow local governments to use the funds on storm water projects in addition to drinking water and sewer projects. The bill now moves to the full Alabama Senate where it will be debated Thursday.

Republican Sen. Greg Albritton, the committee chairman, said he believes the funding will be “astronomical” for the development of the state. “We’re looking at significant, significant infrastructure changes here in Alabama. I’m excited about it. It’s one of the few things we’re doing that I think will have generational differences in our state,” Albritton said.

Gov. Kay Ivey called lawmakers into special session last week to find a way to use the state’s remaining $1.06 billion sent from the federal American Rescue Plan – the sweeping relief plan approved by Congress to help the country climb out of the coronavirus crisis.

Alabama hospitals have said they need additional funding from the legislation. The current legislation steers $100 million to help hospitals financially recover from the coronavirus pandemic, but that is only one-third of the amount that hospitals requested.

Albritton said the the $100 million is what the, “consensus feels like we can do. ”

Dr. Don Williamson, president of the Alabama Hospital Association, said hospitals faced heavy financial losses as expenses roses during the pandemic and because of the high numbers of patients without health insurance.

“We are grateful for the $100 million but it is not going to keep all hospitals at risk of closing from closing,” Williamson said.

The committee approved the bill without a dissenting vote. However, three members abstained from the vote. “When you are spending over a billion dollars, you’re not going to satisfy everybody. In fact, I always tell folks this is only enough money to make more people mad than happy,” Albritton said.

Republican Sen. Arthur Orr, a committee member who is also chairman of the education budget-writing committee, said the bill should also cover costs to the Public Education Employees’ Health Insurance Plan that were “directly attributable” to the COVID-19 pandemic.

“That is what the federal funds were specifically appropriated to do,” Orr said. He said PEEHIP has submitted $95 million in costs “that are due to COVID expenses.”

The proposed spending plan would allocate:

– $339 million for health care costs, including $100 million to reimburse hospitals for pandemic-related expenses, $100 million to reimburse nursing homes and $25 million to support mental health programs and services.

– $400 million for water and sewer infrastructure projects, including $195 million for high-need projects, $200 million for matching funds for public water and sewer systems, and $5 million for septic systems in the Black Belt region. Lawmakers added an amendment to allow local governments to use some of the money for storm water drainage projects.

– $260 million for improvement and expansion of broadband network access.

– $55 million for projects that address economic impacts of the pandemic. The legislation says the Department of Finance may distribute the money for a wide range of needs such as food banks, long-term housing and summer learning programs for children.

The committee also approved separate legislation to use $60 million from a budget surplus to finish repaying money borrowed a decade ago during a budget shortfall. The bill, which was approved by the House on Tuesday, now moves to the full Senate. Alabama voters in 2012 approved borrowing $437 million from the Trust Fund – a state savings account fueled by offshore drilling royalties – to avoid cuts to state services.