State Sen. Ward introduces bill to reallocate new gas tax funds for small business stimulus

State Senator Cam Ward (R-Alabaster) has introduced a bill that would, for a period of two years, redirect all the money gathered by the Rebuild Alabama Act into a small business stimulus fund.

Since the bill amends Alabama’s constitution, the public would get to vote on the proposal during the July runoff if it is passed by the legislature.

The bill would only redirect the additional fuel tax money derived from the Rebuild Alabama Act in 2019. The money from the previously existing fuel tax would still go to roads and bridges.

Ward estimates the bill would create a fund of about $200 – $270 million dollars.

As currently written, the bill gives wide leeway to the Alabama Department of Commerce to create the rules around how the fund would be distributed.

State Senator Tom Whatley (R-Auburn) is a co-sponsor of the legislation.

If passed by the legislature and subsequently voted into law by the people of Alabama, the stimulus fund would gather money for two years after the successful referendum, at which point the fuel tax increase would revert to its original purpose.

The text that would, as of now, appear on ballots in July, is as follows:

Proposing an amendment to the Constitution of Alabama of 1901, as amended, to allow the Legislature to distribute any motor fuel excise taxes levied under the “Rebuild Alabama Act” Act 2019-2, 2019 First Special Session, to the Department of Commerce for a small business stimulus fund for a period of two years after the ratification of the amendment, after which time it shall revert back to its original purpose under general law.

The Rebuild Alabama Act of 2019 raised the fuel tax by 10 cents, but that increase is being phased in over three years.

The gas tax increased by six cents in September 2019 and will go up an additional two cents in each October 2020 and October 2021.

Update 12:06 p.m.:

The idea was to provide some sort of state stimulus for those small businesses impacted by the COVID-19 closures,” Ward told Yellowhammer News in an email.

“It would be for only a limited period of time before it reverted back to the road and infrastructure program,” he added.

“Since the state cannot run deficits we do not have the money to offer a stimulus like the federal government so this is one small way to offer financial relief to our struggling local businesses,” Ward concluded.

Henry Thornton is a staff writer for Yellowhammer News. You can contact him by email: henry@new-yhn.local or on Twitter @HenryThornton95

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