Severance funds diverted to road repairs
By Staff
Jonathan Willis
The Franklin County Commission passed a resolution Thursday morning to support a House bill that would earmark the county's severance tax for road repairs, rather than economic development.
The county has used its severance tax for economic development since it was implemented in 2004.
The original legislation placed a severance tax on natural minerals in the state. Seventy-five percent of that money was to go to highway departments to maintain roads in all other counties but Franklin County.
When the county boosted its industrial recruiting efforts at that time, the money was used for promoting and marketing the area to new businesses.
Officials with the Franklin County Development Authority said this latest move, however, is a devastating blow to the county's efforts to recruit industry.
"It's like putting a big 'closed for business' sign up on the county," said authority chairman Glen Vinson.
Commissioners said they want to meet with all local agencies and government bodies to find another way of funding the authority so the severance tax money can be used for road repairs, particularly in areas where damage is caused by trucks and equipment for mining purposes.
"We are very strong in support of economic development," said Commissioner Stratt Byars.
"We want to work with all local agencies to find another way of funding it."
Prior to Thursday morning's vote, Probate Judge Barry Moore said that he was opposed to the bill.
"I recommend that the money continue to be used for economic development," said Moore, who serves as commission chair. "We have got to get industries in here to make the county grow."
Rep. Johnny Mack Morrow indicated that he would push the bill forward if the county commission supported it.
The move comes at a time when the city of Russellville is building an industrial spec building.
The building purchase included $500,000 from Russellville, a $40,000 interest-free loan from the development authority, a 5 percent interest loan of $500,000 from all five banks in Franklin County, a $150,000 interest-free loan from Russellville Utilities and a donation of 16 acres of the 20-acre site.
"I realize all levels of government are going through tough financial times," said Russellville city councilman Jeff Masterson.
"However if this bill passes the house and senate, it will have far more reaching results than just on the Franklin County Commission. Russellville, along with several banks, are expecting the development authority to market our new spec building.
"Without this funding the authority would cease to exist. This means jobs, growing our economy for a better county. True we haven't landed many jobs recently, but let's remember we are in uncharted waters financially. Still we have to be prepared when we come out of this recession. Just look at how the boxcar plant is proceeding. Other counties have different methods of funding their authorities. Former Probate Judge Mike Green and others worked hard to get the current bill through legislation. Personally, I think if this amended bill passes, we've taken a big step backward in recruiting jobs and supporting education for all Franklin County."
The Franklin County Development Authority is funded by the severance tax and the cities of Russellville and Red Bay.
State legislators must approve the amendment before it's entered as law.
The house bill is out of committee, but the amendment still may never materialize.
State Sen. Roger Bedford said that he does not anticipate the bill's passage.
"We worked for three or four years to find a funding source for economic development in Franklin County," Bedford said. "Different counties have different ways of funding economic development."
He pointed out that Walker, Marion, Lamar and Winston counties use coal taxes, while the Shoals area uses sales tax.
"I respectfully disagree with the thought of taking the money away from economic development and using it to fix some pot holes. That's not the answer, especially in these difficult economic times. I want Franklin County to be ready to take advantage of new opportunities when we come out of this recession."
