Democratic candidate for governor Ron Sparks told north Alabama audiences this week that he backed legislation to draw $100 million a year for ten years from the state’s oil and gas trust fund and spend it on Alabama’s highways — a $1 billion proposition that placed him squarely on one side of one of Montgomery’s most durable arguments.
Sparks, the state’s commissioner of agriculture and industries, was seeking the Democratic nomination for governor in the June 1 primary. He did not flinch from the criticism such proposals invariably attract.
“I don’t think it gets much rainier in Alabama than it is today,” Sparks said, playing on the shorthand officials use for the state’s reserve accounts.
Why the trust fund is a South Alabama story
The money Sparks proposed to spend has a coastal origin that is easy to forget in Montgomery. Alabama’s trust fund was built in large part on royalties collected from natural gas produced in state waters off the Alabama coast, in and around Mobile Bay. The wells that dot the bay and the leases beyond it converted a finite natural resource into a permanent endowment, with earnings flowing to state and local governments rather than being consumed in a single budget year.
That design was deliberate, and it is why proposals to reach into the fund provoke such a sharp reaction from legislators and finance officers in both parties. The fund was meant to outlive the gas fields that filled it.
The case Sparks was making
Sparks’s argument was an economic one. Alabama in December 2009 was still climbing out of a recession that had gutted state revenue, forced budget proration and idled construction crews. Road and bridge money, in that environment, is not merely infrastructure spending but jobs spending, and it reaches every county in the state. A guaranteed $100 million a year, Sparks contended, would let the state plan and let contractors hire.
Highway needs in South Alabama were not abstract. The region’s freight corridors, the Interstate 10 crossing of the Mobile River, the highways carrying traffic to and from Baldwin County’s beaches, and the farm-to-market roads serving Washington, Clarke, Escambia and Monroe counties all competed for a shrinking pool of state and federal dollars. Local officials had spent years warning that maintenance backlogs were growing faster than budgets.
The objections
The standard case against Sparks’s approach is straightforward, and it was made loudly whenever a version of it surfaced. Trust fund money is one-time money; roads are a recurring obligation. Divert the earnings, critics argued, and the state trades a permanent income stream for a decade of asphalt, leaving the next governor and the one after that with the same problem and a smaller cushion. Bond buyers and rating agencies watch reserve balances closely.
Supporters countered that a savings account that cannot be touched during the worst downturn since the Depression is not much of a savings account — which was precisely the point Sparks was making with his line about the rain.
The politics of the proposal
The plan also served a campaign purpose. Sparks was running behind U.S. Rep. Artur Davis of Birmingham in most assessments of the Democratic primary, and he needed issues that separated him from a rival with a national profile and a substantial fundraising advantage. A concrete, dollar-denominated plan aimed at working people in rural counties — the parts of Alabama where Sparks built his base as agriculture commissioner — was the sort of contrast he was looking for.
Whether the Legislature would ever pass such a bill was a separate question. The protections wrapped around Alabama’s savings meant that significant changes would likely require a statewide vote, and Alabama voters have historically been reluctant to loosen them. But as a statement of priorities, the proposal told voters what a Sparks administration intended to do first, and it did so in a currency — paving — that every county commissioner in the state understands.