— Alabama voters will decide next month if they want to transfer funds from a state savings account to the General Fund in an effort to stave off deep budget cuts to prisons, agencies and Medicaid.

The Medical Association of the State of Alabama believes a “no” vote on the Sept. 18 referendum could cause the state’s health care system to crumble if the general fund is no longer able to fund Medicaid.

“If the (constitutional) amendment fails, it could cause the closing of many of the state’s hospitals and many doctors’ offices in the state,” said a press release from the group.

Closer to home, officials with the Limestone County Council on Aging want local seniors to be aware of what the amendment means and what potential consequences are should it be voted down. The agency will host a public meeting at noon on Thursday Aug. 16, at the Athens Senior Center at 912 W. Pryor St. to address the issue.

Appearing at the meeting to speak about the referendum will be State Sen. Bill Holtzclaw, R-Madison, and State Reps. Dan Williams, R-Athens, and Micky Hammon, R-Decatur.

Jennifer Reece, assistant director for the Limestone County Council on Aging, said the three invited representatives have been vocal in their support for senior causes, and added she hopes they will be able to explain how seniors could be affected.

“These amendments can be really confusing, and this is one that will affect Medicaid and the prisons,” she said. “I’m just hoping we can get the information out there because it could affect one out of three seniors.”

Williams said failure to approve the amendment could have deep effects on the state prison system and senior health care, including nursing homes. And if it doesn’t pass, he said, the Legislature may be forced to take money from the Education Trust Fund.

“The big problem most folks have with this referendum is there’s not a clause for payback,” he said. “When you borrow money from your savings plan, you have a mindset that you want to pay it back. This referendum doesn’t have that.”

Williams said it’s his understanding that Republican Sens. Jay Love and Brian Taylor plan to sponsor legislation in the next regular session that would pay back the funds within 10 years. However, he said it’s unfortunate the legislation would come after the vote.

The Alabama Trust Fund, which is the savings fund targeted by the amendment, contains about $2.5 billion, and Williams said the interest from that fund is currently being used to fund several state agencies. Pulling nearly $200 million from savings to plug a hole in the ailing General Fund will reduce that interest amount.

“If you don’t put it back, you’ve made a crack in the goose that laid the golden egg,” Williams said.

If the referendum doesn’t pass, Gov. Robert Bentley may call a special session to address how to make up the funding shortfall. Williams said ideas he’s heard include taxes on cigarettes and soft drinks.

“Not everybody smokes, but just about everybody drinks Cokes,” he said.

Bentley spokesman Jeremy King said the governor’s office has identified stronger sources of revenue that will now go toward the General Fund budget without raising taxes. As those revenues build up, he said, the need for the Alabama Trust Fund allocation should be over after three years.

King said Gov. Bentley supports the amendment as a way for Alabama to meet its budget challenges without having to raise taxes or make devastating cuts to essential services. 

“This is about making the most use of the resources we have available,” he said. “This amendment simply allows us to access a portion of the money the state has in a savings account in order to offset devastating cuts.”

King said the governor’s office is also continuing its mission to streamline and right-size state government. He said the office has identified greater efficiencies, and is on the way to achieving $1 billion in annual savings for taxpayers.

“We are getting Alabama on a more firm financial foundation,” he said. “The constitutional amendment is a bridge to get us where we need to be.”