Get the Daily News Digest in your inbox each morning. Sign Up

Ivey calls special, draft bill shows ARPA spending on health care, broadband, water and sewer infrastructure

By TODD STACY, Alabama Daily News

MONTGOMERY, Ala. – The Alabama Legislature will meet Wednesday to begin a special session focused on spending about $772 million in federal COVID-19 relief money.

Gov. Kay Ivey made the special session call Tuesday afternoon.

“I again urge the members of the Legislature to direct these funds to meet some of Alabama’s biggest challenges like statewide broadband connectivity, water and sewer infrastructure, as well as investing funds in our hospitals, nursing homes and other health care providers,” she said. “We must be smart with these one-time, federal dollars by wisely investing – not just casually spending them. This is not free money.”

A special session focused only on ARPA funds allows the Legislature to focus on that issue without lobbying for their own priority bills at the same time. The special session is expected to be completed by the end of the month and the regular session will resume in early February.

Draft legislation obtained by Alabama Daily News shows a plan to spend the money on expanding broadband internet, assisting hospitals and nursing homes and building out water and sewer infrastructure in communities where service lacks.

The draft bill lines up funding wise with a spreadsheet circulated among state lawmakers late last week. That was first reported by ADN on Friday.

Alabama received more than $2 billion in American Rescue Plan funds. Lawmakers are currently drawing plans for about $580 million from a tranche received last year and about $192 million in a separate capital projects fund, which must be directed at more specific infrastructure needs. About $1 billion is expected later this year, but lawmakers aren’t yet allocating it.

The draft bill would allocate $80 million to the state’s hospitals and nursing homes “to support the delivery of health care and related services to citizens of Alabama related to the pandemic by and through reimbursement of eligible expenses.” Those funds would be delegated by the Alabama Hospital Association and the Alabama Nursing Home Association.

The bill contains an additional $30 million in grants to rural hospitals, $36 million to state mental health, nursing or veterans homes, and $5 million to support telemedicine through the Alabama Department of Public Health.

The draft legislation calls for a total $225 million to be spent on water and sewer improvements in communities where service is lacking. Recent reports of unsanitary conditions in rural areas without city or county water service have made this issue a priority for lawmakers.

Specifically, $120 million would be used as grants to local water and sewer systems for “emergency or high need projects,” $100 million would be available for matching grants for local governments doing projects, and $5 million would be used for grants to install ‘clustered decentralized wastewater system demonstrations utilizations utilizing a collection system known as Septic Tank Effluent Pump” or other demonstration systems. The STEP money is specifically for areas in the Black Belt “where there is a finding of discharge of raw sewage onto the ground due to the utilization of straight pipes, failing septic systems, or similar circumstances.”

The water and sewer funds would be administered by the Alabama Department of Environmental Management.

A total of $243 million would be spent on expanding access to high speed broadband internet – $51 million from the revenue replacement fund and the full $192 million from the capital projects fund. The broadband money would be administered by the Digital Expansion Division of the Alabama Department of Economic and Community Affairs.

The bill calls for $79 million to shore up the state’s Unemployment Insurance Trust Fund, from which unemployment benefits are paid. Lawmakers have told Alabama Daily News this is to avoid an automatic tax increase on businesses that goes into effect when the trust fund runs out.

State leaders have stressed that these federal COVID-19 relief funds are a once-in-lifetime event for the state.

“We want to do with the ARPA funds things that are going to pay dividends, investments that we can make into Alabama long-term,” Senate President Pro Tem Greg Reed, R-Jasper, said last week.

Lawmakers have also been cautioned that the funds require a tremendous amount of accounting and oversight to be reported to the federal government. 

The draft legislation creates a “Joint Legislative Oversight Committee on American Rescue Plan Act Funds” made up of the top legislative leadership from both parties that would receive reports on the spending from the Finance Department and have the power to hold hearings. The bill also empowers the State Finance Director to adjust the use of funds with the concurrence of a majority of the Speaker of the House, the President Pro Tem of the Senate, the House Minority Leader, the Senate Minority Leader and the four budget chairmen from each chamber.

Read the legislation in full below.

Draft ARPA Bill by Todd Stacy

Get the Daily News Digest in your inbox each morning.

This field is for validation purposes and should be left unchanged.

Web Development By Infomedia