FISCAL NOTE

House Bill 4 (Act 2021-546) as enacted authorizes the Alabama Corrections Institution Finance Authority (Authority) to issue up to $785 million in bonds to fund a phased plan for the construction and renovation of prison facilities to replace existing bed space, which would increase the annual debt services obligations of the Authority by an estimated $50 million for 30 years. This obligation would be offset by the rent received from the Alabama Department of Corrections (Department) for the lease of any facilities constructed or renovated from these bond proceeds, presumably funded from the State General Fund appropriation to the Department.

The phased construction and renovation of prison facilities by the Authority authorized by this act includes the following:

Phase 1: construction of a men’s facility in Escambia County, construction of a specialized men’s facility in Elmore County, and closure of the Staton, Elmore, and Kilby facilities. Following the closure of these facilities, provides for the Department to close the St. Clair Correctional Facility;

Phase 2: construction of a women’s facility in Elmore County, closure of the Tutwiler facility, and renovation or demolition and reconstruction of certain existing men’s facilities;

Phase 3: evaluation of the men’s facilities to determine if additional beds need to be replaced, including a site assessment of the Bibb Correctional Facility to determine the feasibility of repurposing the facility.

Further, this act provides for the awarding of the contracts for design and construction of the men’s facility in Escambia County and specialized men’s facility in Elmore County. This act also provides that all other construction contemplated by this act shall be subject to the current statutory public works bid requirements and authorizes the authority to negotiate with bidders on such construction, when multiple bids are received, and all of the bids exceed the available funding.

Further, this act creates the Department of Corrections – Correctional Capital Improvement Fund and the Correctional Facilities Maintenance Fund within the State Treasury to be administered by the Department. This act requires the Legislature to appropriate funds 1) to the former to be used exclusively for the construction, renovation, and improvement of prison facilities pursuant to the phased prison construction and renovation program authorized by this act; and 2) to the latter to be used exclusively for the maintenance of prison facilities constructed under the provisions of this act.

In addition, this act could also increase receipts to the Correctional Facilities Maintenance Fund by an undetermined amount dependent upon the proceeds received by the Authority from the sale, conveyance, or lease of all or any part of real and personal property that is not being used by the Department, as authorized by this act.

Further, this act would also increase the obligations of the State General Fund to lease or purchase the prison facility in Perry County. Act 2021-548 appropriates $19 million for this purpose.

Further, this act requires the Authority to submit a report to the Legislature within 30 days of completion of any bond sale. The Authority is required to: 1) develop a plan that encourages minority business participation in the construction of prison facilities; 2) administer training programs and other educational activities to enable participation on an equal basis; and 3) submit a quarterly report to the Governor and Legislature on minority participation. This will increase the obligations of the Authority by an undetermined amount to comply with the provisions of this act.

Further, this act authorizes the Authority to delegate its administrative or reporting duties and obligations to the Department or any other state entity, which would increase the administrative obligations of that state entity.

Finally, this act adds the following four members to the Authority: 1) the Chair of the House Ways and Means-General Fund Committee; 2) the Chair of the Senate Finance and Taxation-General Fund Committee; 3) a joint appointment by the House and Senate Minority Leaders; and 4) the Director of the Bureau of Pardons and Paroles.