Ken Hare In Depth: The importance of Tuesday's referendum - WAFB 9 News Baton Rouge, Louisiana News, Weather, Sports

Ken Hare In Depth: The importance of Tuesday's referendum


A hugely important issue will be decided by the state's voters Tuesday. The outcome of that decision could impact everything from nursing home care to health care to whether state prisoners are released early.

But sadly, it's possible that only one of every five registered voters in the state -- and perhaps even fewer -- will make that decision.

The statewide referendum on Tuesday would allow the state to divert $147 million a year for three years to the state's General Fund from the $2.5 billion Alabama Trust Fund. The Alabama Trust Fund, which comes from revenues from state oil and gas royalties, has been referred to as the state's savings account.

To put that into perspective, the amount diverted if the referendum is approved would amount to about 17 percent of the trust fund.

The state's chief election official, Secretary of State Beth Chapman, predicted that a turnout of 20 percent of the state's voters is probably optimistic. She noted that 10 percent or fewer of the state's voters cast ballots in most single-issue elections in Alabama.

There are exceptions. She told the news media that a referendum on a statewide lottery and a proposal for tax reform drew voters in large numbers But both were accompanied by major pro and con advertising campaigns.

As currently written, the biggest hit if the referendum fails would be on the state's Medicaid program. It would face a $100 million shortfall in revenue as the state budget is currently written. But since state funds are used to match federal funding, the real impact could be much greater than that.

Why is that important? Funding for health care for about 900,000 Alabamians comes through Medicaid. More than 60 percent of all nursing home residents in Alabama are Medicaid patients.

As important as their decision will be on Tuesday, Alabama voters should strongly resent being put into the position of having to make that choice. Alabamians elect governors and legislators to provide the kind of leadership that should avoid such crisis-style choices.

For years now, through the terms of several governors and through many legislative sessions, it has been clear that revenues from the taxes that support the state's General Fund -- which funds most non-education operations of state government -- have not been growing fast enough to keep up with the demand for services. But Democratic and Republican administrations alike have failed to do anything significant to address the problem.

Then along came the big economic downturn of recent years, and a big problem became a huge one.

Instead of getting at the root of the problem -- the year-in and year-out shortfall of tax funding for the General Fund -- the Republicans who control the governor's office and the Legislature dumped the issue in the laps of the public with another temporary fix -- the diversion from the trust fund.

Democrats are decrying the lack of courage among their GOP opponents, but they have no room to criticize. Not only did they fail to address the General Fund's weakness when they controlled the Legislature, they have offered no real alternative to the more immediate crisis. They promise to come up with one, but even if they do they have no power at all to implement it.

Some people say they are reluctant to support the referendum because its failure would force the Legislature to act on a long-term fix to bolster the General Fund, and perhaps to even address the overall issue of tax reform.

While it's true that the failure of the referendum would put pressure on the Legislature and the governor to increase taxes, it's not likely to happen based on the records and the statements of legislative leaders and the governor.

If this referendum fails, the Legislature almost certainly will try to spread the pain by moving around some money in the budget. But there are few signs that there is the political will among lawmakers to do anything beyond that.

Caught in the middle of all this are real people, and not just those served by Medicaid. It's also very possible that if the referendum fails, the impact on Medicaid could force the closure of some smaller, rural hospitals around the state, which would require all residents served by those hospitals to travel farther for care. And once they close, those hospitals are unlikely to ever open their doors again, even if funding returns in future years.

Dr. Donald Williamson, state health officer, told me recently that he was "as despondent about where we are as I've ever been."

The impact almost certainly would go beyond Medicaid if the referendum fails. It's possible that state inmates would have to be released early. If lawmakers try to shift funds to lessen the impact on Medicaid and prisons, it would mean other services would suffer. County health department offices might close, or foster children lose care.

But if the referendum passes, what happens once the diverted money runs out in three years? House Speaker Mike Hubbard, R-Auburn, told me recently that the diversion could buy time for two things to occur.

First, he said, it would allow time for some of the cost-saving measures already implemented by the Legislature to begin to have an effect.

Second, it would give Congress time to address the issue of online sales taxes. Many states are pushing Congress to adopt new laws to require online sellers to collect state sales taxes, which many buyers now avoid. If Congress acts, much of that new revenue for Alabama would flow to the General Fund. But it's likely to take several years for Congress to act and any new law to go into effect.

Alabama voters should not have been forced to make the decision they will have to make Tuesday. But that makes it no less crucial that they make the right decision when they go to the polls.

Copyright 2012  WSFA 12 News.  All rights reserved.

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