Our Alabama lawmaker lads and lasses want to borrow $800 million to transform the corrections system by building new prisons. They claim they can service the loans with savings in operations expenses, but this sounds specious because there would be no operating savings during the construction and transition period and our lawmaker lads and lasses have used up whatever trust they might have had when the Republican majority seized Montgomery over five years ago. In any event, borrowing money costs money in the form of interest and an $800 million loan for 30 years could cost as much as $700 million in interest, raising the cost of prisons to $1,500 million ($1.5 billion)
Our lawmaker lads and lasses also want to give a 4 percent pay raise to government education workers, about half of whom are teachers, spending which is not affordable while Alabama government retirement systems are underfunded by $15 billion with no prospect of reform sight.
But if Alabama has revenue to support the education pay raise, that revenue could also be spent to build the new prisons on a pay as you go basis without borrowing. This would save Alabama tax payers as much as $700 million. This makes sense to me, does it to you?
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