Imagine stealing $108 – from a kindergartener. Unthinkable, right? If you’re an Alabama state lawmaker, you’ve already done it.
I’m referencing, of course, the conclusion of Governor Bentley’s month-long budget battle, where Alabama lawmakers decided to meet the state’s need for cash by “borrowing” money from the Education Trust Fund – to the tune of $80 million. The move, which equates to taking $108 from every K-12 student in Alabama, will have devastating effects on education outcomes. The action has gone largely unnoticed.
To be fair, this wasn’t Bentley’s first choice, but we’ll need some background to understand exactly why. Alabama is funded through two pools of money: the General Fund and the Education Trust Fund. The General Fund is comprised of revenue from all kinds of taxes, and the Education Trust Fund is comprised mainly of property taxes. For a long time, the two pools didn’t mix, and this kept politicians from tampering with school funding.
But then, some sneaky politicians began inventing clever tax tricks to reduce funding flowing into the ETF, allowing the General Fund to “borrow” from the ETF.
So, when Alabama’s General Fund had revenue shortfalls of $200 million, Bentley proposed an enormous tax plan, which would raise taxes on everything from income to soft drinks to cigarettes. This wouldn’t directly affect education funding. Great, right?
Not so fast. Alabamians, abhorring taxes as they do, threw a fit. Lawmakers feared their re-election chances should they participate in this historic tax hike. So only small parts of the plan actually made it through.
Left with no money, and fearing a vengeful public, lawmakers decided to look at a group that couldn’t vote them out of office – school children – and proceeded to rob them.
To reiterate, lawmakers took money from eighth graders who rank 50th in math, 46th in science and 45th in reading. They took money from teachers and administrators who pay increasingly out of pocket for higher healthcare costs and to keep their classes running. I recognize money isn’t everything when it comes to producing better outcomes, but having enough textbooks to supply a classroom certainly helps.
What’s worse is that this has happened many times before and will likely happen again if left unchecked. Alabama’s education system cannot afford to pay Montgomery’s bills.
The tragic irony to this whole mess? There’s an easy fix to Alabama’s money problems.
And almost no one is talking about it.
Remember how the ETF is funded through property taxes? Well, Alabama has the nation’s lowest, coming in at half of a percent. The median home value in Alabama is $122,700, and that property is taxed at $532 – just 0.4 percent. Out-of-state farm and timber corporations pay even less, using their powerful lobbies to keep their taxes at pennies per acre. Doubling, tripling or even quadrupling the property tax would impose a minimal burden upon Alabamians while boosting education funding significantly.
Raising property taxes, of course, would require standing up to the powerful lobbies that keep them the lowest in the nation. And while it’s the right thing to do, Bentley and the current administration have shown no such intentions. Until then, we will continue to do the unthinkable and steal from kindergarteners.
Ben Jackson is a sophomore majoring in accounting and finance. His column runs biweekly on Wednesdays.
