The sponsor of the bill that became Statewide Amendment 6 on ballots across Alabama next Tuesday said the legislation came at the request of the city of Huntsville.
Amendment 6 would allow cities that already collect a special ad valorem tax to use that money for pay-as-you-go public projects. It would repeal a restriction in the state Constitution that says cities can spend money from the tax only to pay bonds or other debt service on projects.
Rep. Mike Ball, a Republican from Madison, said Huntsville wanted the flexibility in how to use the money.
“They didn’t want to have to go to the bond market to borrow money specifically so they could spend this money,” Ball said. “It just made sense to them to be able to spend it to do some pay-as-you-go project with it. To me that seemed the ultimate in responsible government to be able to do that if you can.”
As Ball noted, the amendment will not create a new tax or raise an existing tax.
“It just provided that the money that this tax generated could be spent on a pay-as-you-go project instead of requiring them the additional cost and expense and bureaucracy of going to the bond market,” Ball said.
The bill passed the House of Representatives and the Senate last year with no opposition.
The amendment applies to cities that passed a special ad valorem tax authorized by Amendment 8 to the Alabama Constitution of 1901. About 40 cities are on that list, including Huntsville and Birmingham, but not Mobile, Montgomery, Tuscaloosa and some of the other major cities in the state.
Lori Lein, general counsel for the Alabama League of Municipalities, said the League did not spearhead passage of the bill that became Amendment 6. But Lein said the League supports the amendment because of the flexibility it provides the affected cities in how to use an existing revenue source.
Amendment 6 is one of 10 statewide amendments on the ballot Tuesday.