Oil spill puts Alabama education system in major bind

Alabama Superintendent of Education Joe Morton is seeking compensation for damages after the BP oil spill.
Alabama Superintendent of Education Joe Morton is seeking compensation for damages after the BP oil spill.

MONTGOMERY, AL Leaders within the Alabama Department of Education are sounding the alarm on "the catastrophic effects of the British Petroleum (BP) oil spill in the Gulf of Mexico" and what the disaster will do to the state education system's financial health.

In a press conference Thursday, State Superintendent of Education Joe Morton outlined the negative impact that the BP oil spill is having throughout the state and, most directly, to the Alabama Education Trust Fund (ETF).

Along with State School Board Vice President (District 1) and Gulf Coast resident and business owner Randy McKinney, Morton expressed the State Department of Education's plan to recoup from BP the revenue lost from the Education Trust Fund due to the circumstances associated with the oil spill.

"The BP nightmare in the Gulf of Mexico is having and will continue to have a negative effect on the Education Trust Fund," declared Dr. Morton.

Alabama has a unique funding structure, receiving most of its educational funding from sales and income taxes. For that reason, the state is negatively affected by circumstances that slow down employment and sales.

Estimates are that tourism along the Gulf Coast has plummeted more than 50 percent since the BP oil spill started nearly two months ago.

"As tourism diminishes along Alabama's Gulf Coast, as the seafood industry is crippled due to the "no fishing" areas, and as oyster and shrimping areas are decimated by the oil spill, tax receipts to the Education Trust Fund will suffer," explained Dr. Morton.

McKinney said BP officials have made comments concerning their efforts to make affected communities whole: "I was glad to see BP's commercials stating they accept the moral and economic obligation."

"School boards on Alabama's Gulf Coast have done all they can do," continued McKinney. "There is absolutely no way we can ask these school boards to do more with less as a result of the BP oil spill in the Gulf. They cannot accept any more losses, especially of this magnitude. We must make sure the school systems in Alabama do not take on any more burdens from the impact on those revenue streams."

"The Education Trust Fund is a dedicated fund composed of ten different taxes collected at the state level and dedicated to funding public education in Alabama from Pre-K to Medical School. The primary taxes are personal and corporate income taxes, a 4¢ statewide sales tax, and a utility tax," Morton said. "Each of these has its own unique impact on the Trust Fund. When one or more of these taxes are reduced, the Trust Fund suffers and has less accumulated tax receipts to fund education in Alabama."

Morton said he has the full support of Governor Bob Riley, and the State Department of Education plans to move forward with plans to file claims in a manner consistent with the standard claim-filing process. However, Morton did point out that if restoration for the damaged Trust Fund is not handled in a timely manner, there will be no hesitation to seek court action if necessary.

"Because of the BP tragedy and the corresponding loss of Trust Fund revenues so far, plus the anticipated growing loss of revenues, I am declaring that I will charge BP with restoring the revenues lost to date as well as future lost revenues to the Trust Fund," Morton said. "I will enlist economic experts outside the Department of Education to work with our staff to develop an irrefutable economic model of lost revenues to the Trust Fund per month and send BP a bill. Should this method of restoring lost funds to the ETF be challenged or rebuffed by BP, I will institute a court action against BP on behalf of the 745,046 school-aged students in Alabama's public schools to ensure all lost tax receipts are recovered and placed properly in the Education Trust Fund of Alabama as quickly as possible."

Information Source: Alabama Department of Education