Alabama Capital Improvement Trust Fund, Amendment 2 (2014)

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Amendment 2
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Type:Constitutional amendment
Constitution:Alabama Constitution
Referred by:Alabama State Legislature
Topic:Government Finances
Status:Approved Approveda
2014 measures
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July 15
Amendment 1 Approveda
November 4
Amendment 1 Approveda
Amendment 2 Approveda
Amendment 3 Approveda
Amendment 4 Approveda
Amendment 5 Approveda
EndorsementsFull text
Polls
The Alabama Capital Improvement Trust Fund, Amendment 2 was on the November 4, 2014 ballot in Alabama as a legislatively-referred constitutional amendment, where it was approved.

The measure was designed to increase the total amount of bonding authority granted under Amendment 666 to the Constitution of Alabama of 1901; provide for additional payments from the Alabama Trust Fund to fund any bond issued; provide for competitive bidding of the bonds; require the Bond Commission to contract with businesses or individuals which reflect the racial and ethnic diversity of the state; and provide for the use of the proceeds for plans, construction and maintenance of Alabama National Guard armories.[1] The measure was known as Senate Bill 260 in the Alabama Legislature.[2]

Election results

Below are the official, certified election results:

Alabama Amendment 2
ResultVotesPercentage
Approveda Yes 479,026 50.48%
No469,99849.52%

Election results via: Alabama Secretary of State

Text of measure

Ballot title

The official ballot title of this measure appeared as follows:[3]

Statewide Amendment 2

Proposing an amendment to the Constitution of Alabama of 1901, as amended, relating to the Capital Improvement Trust Fund, to increase the amount of the General Obligation Bonds authorized herein; to provide for additional payments from the Alabama Trust Fund to fund any bond issued; to provide for competitive bidding of the bonds; and to provide for the distribution of the proceeds for plans, construction, and maintenance of Alabama National Guard armories. (Proposed by Act 2013-266)

Yes ( )
No ( )
[4]

Ballot summary

The full ballot summary was as follows:[5]

Amendment 2 proposes an amendment to the State Constitution to allow the State to borrow up to an additional $50 million to provide plans, construction and maintenance of National Guard armories in Alabama. The cost to the State may be matched by the Department of Defense. The State would raise the funds by issuing bonds that must be repaid within 20 years. These funds would be distributed to the Armory Commission of Alabama for Alabama National Guard armories.

Proceeds from the Alabama Trust Fund would be used to repay the bonds. The Alabama Trust Fund is funded by revenues generated by oil and gas production in the Gulf of Mexico.

If Amendment 2 IS PASSED, the State may borrow up to an additional $50 million in bonds to be repaid within 20 years in order to fund plans, construction and maintenance of Alabama National Guard armories.

If Amendment 2 IS DEFEATED, the State will not be authorized to borrow up to an additional $50 million in bonds for construction and maintenance of Alabama National Guard armories.

The cost of Amendment 2 is not known at this time.

Amendment 2 will have no direct impact on taxes, but would redirect the distribution of income from the Alabama Trust Fund. It is estimated that the cost to the ATF of repaying $50 million in bonds that could be issued under this Amendment would be about $3.7 million annually for 20 years, which could reduce interest income to the General Fund and local governments.

The Constitutional authority for passage of this Amendment is set forth in Sections 284, 285, and 287 of the State Constitution. These sections outline the way a constitutional amendment may be put to the people of the State for a vote. [4]

Constitutional changes

Alabama Constitution
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Preamble
Articles
IIIIIIIVVVIVIIVIIIIXXXIXIIXIIIXIVXVXVIXVIIXVIII
Amendments

Amendment 2 added a section to the Alabama Constitution to read as follows:[2]

(a) The authority granted to the State of Alabama to become indebted and to seel and issue its interest-bearing General Obligation bonds, in addition to all other bonds of the state, under Amendment 666 to the Constitution of Alabama of 1901, as amended, is hereby increased by an additional amount of fifty million dollars ($50,000,000).

(b) All of the bonds shall be sold only at public sale or sales, either on sealed bids or at public auction, after such advertisement as may be prescribed by the Bond Commission, to the bidder whose bid reflects the lowest true interest cost to the state computed to the respective maturities of the bonds sold; provided, that if no bid deemed acceptable by the commission is received all bids may be rejected.

(c) Relative to issuance expenses, contracts, and appointments incurred in connection with the issuance of bonds, the Bond Commission created in Section IX of Amendment 666 to the Constitution of 1901, shall contract with businesses or individuals which reflect the racial and ethnic diversity of the state.

(d) Bonds issued pursuant to this amendment shall be issued for a maturity of 20 years or less.

(e) All of the proceeds from the bonds shall be distributed to the Armory Commission of Alabama for plans, construction, and maintenance of Alabama National Guard armories.

(f) In addition to any Oil and Gas Capital Payments received by the Alabama Trust Fund paid into the Alabama Capital Improvement Trust Fund pursuant to Amendment 666, so much as shall be necessary of all Oil and Gas Capital Payments received by the Alabama Trust Fund during any fiscal year shall be paid into the Alabama Capital Improvement Trust Fund to pay the principal and interest on the bonds authorized by this amendment.

(g) In all other respects regarding the Alabama Trust Fund, the terms and provisions of Amendment 666 and Amendment 856 to the Constitution of Alabama of 1901, as amended, are unchanged and remain in full force and effect.[4]

Support

SB 260 "Yes" votes

The following Alabama legislators voted in favor of putting Amendment 2 on the ballot:[6]

Note: A yes vote on SB 260 merely referred the question to voters and did not necessarily mean these legislators approved of the stipulations laid out in Amendment 2.

Senate

House

Opposition

SB 260 "No" votes

The following state legislators voted against placing SB 260 on the ballot:[6]

Note: A no vote on SB 260 meant that a legislator did not want to refer the question to voters and did not necessarily mean these legislators disapproved of the stipulations laid out in Amendment 2.

Senate

The following Alabama Senators voted against placing Amendment 2 on the ballot:[6]

House

Rep. Arthur Payne (R-44) was the only Alabama Representative to vote against putting Amendment 2 on the ballot.

Media editorial positions

See also: Endorsements of Alabama ballot measures, 2014

Support

  • The Montgomery Advertiser said,
Amendment 2 is also worthy of passage. It authorizes the issuing of bonds to pay for plans, construction and maintenance of National Guard armories. The proceeds can be matched by federal funds from the Department of Defense.[4]

—Montgomery Advertiser, [7]

  • The Times Daily said,
While some constitutional amendments that will appear on the ballot are silly political gimmicks, amendment 2 supporting the Alabama National Guard and amendment 4 protecting school districts from unfunded mandates deserve support.[4]

—Times Daily, [8]

Opposition

  • The Dothan Eagle said,
It’s well past time that Alabama lawmakers address the state’s chronic fiscal woes with stable funding rather than taking shortcuts like dipping into the Rainy Day fund. When does it end?

Our recommendation: Vote no.[4]

—Dothan Eagle, [9]

  • The Gadsden Times said,
This amendment would increase the state’s borrowing capacity by $50 million with the money to be used to rebuild some of the state’s crumbling National Guard armories. We know the armories need work but have reservations about using proceeds from the Alabama Trust Fund to repay the money. The trust fund proceeds help support services such as public safety, the court systems, the prison system and Medicaid health care for the poor and disabled. The cost of repaying the loans are estimated to be $74 million over 20 years, and we can’t see taking any money away from those already strapped services, as much as we support the National Guard.[4]

—Gadsden Times, [10]

Path to the ballot

See also: Amending the Alabama Constitution

According to Article 18 of the Alabama Constitution, both houses of the Alabama State Legislature were required to pass the bill by a three-fifths or 60 percent vote, in order to send it to the statewide election ballot. If the amendment is approved by a simple majority of the electorate, it will become part of the constitution.[11]

On April 30, 2013, the Alabama Senate approved SB 260 by a vote of 23 to 7. On May 20, 2013, the Alabama House followed suit, approving the bill by a vote of 93 to 1.[11]

Senate vote

April 30, 2013 Senate vote

Alabama SB 260 Senate vote
ResultVotesPercentage
Approveda Yes 23 76.67%
No723.33%

House vote

May 20, 2013 House vote

Alabama SB 260 House vote
ResultVotesPercentage
Approveda Yes 93 98.94%
No11.06%

See also

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External links

References