Special session all about new jobs

MONTGOMERY -- Job recruiting will be a hot topic Monday when legislators go into special session.

Alabama has several industrial-recruiting finance options for projects, including a request from Gov. Bob Riley to increase the state's bond issue cap for economic development.

Other options include state or federal financing for potential industrial projects in the Shoals.

The Shoals project is one of several on the table and one reason why Riley said he ordered the special session, which begins at 5 p.m. Monday.

Riley wants to reintroduce a constitutional amendment passed in 2000 that capped the state's economic development trust fund bonding authority at $350 million. The governor wants the cap increased to $750 million.

The 2000 legislation, which was ultimately approved by voters, created the Capital Improvement Trust Fund. If the Legislature approves the new cap, the constitutional amendment could be on statewide ballots for voter consideration in early June.

In addition to economic development, the special session will involve more potential mortgage money for the Alabama Housing Finance Authority for first-time and lower-income homebuyers.

Democratic Senate majority leader Zeb Little, D-Cullman, was critical of Riley's timing in calling a special session, noting that Louisiana dealt with economic development issues in a December special legislative session.

Some legislators say the

special session was called because a Republican-led filibuster is almost a certainty in the regular session, which will make all legislation move slowly through the system, if at all.

Riley said the timing was right because some of the industrial projects eyeing the state want to know if Alabama can afford the incentives necessary for them to locate here.

Little said Democrats will work tirelessly to increase the bond limit, but party members want "accountability and transparency" in the process.

Riley wants the special session to end Friday, but it could last until March 5, the day before the Legislature opens its regular-session.

In the special session, Riley also wants to create irrevocable trust funds so the state can cover an estimated $20 billion in future health benefit costs for retired state employees and teachers.

Riley recently met with economic developers to explain economic development hopes that include up to 10 industries.

"Alabama is competing for 10,000 new jobs right now, and these companies will soon be making their decisions on whether to come here or go someplace else,'' Riley said. "Our pursuit of these jobs has to go into overdrive, but that can't happen without the support of the Legislature next week and the support of the people in June.''

Riley is after 1,500 potential jobs for the Shoals, 500-1,000 jobs for Montgomery County and 2,700 jobs for Mobile County that is related to a $2.9 billion steel plant.

On Feb. 7, German steel maker ThyssenKrupp narrowed its preference for a location to two states.

"After extensive preliminary investigations, the site selection process is now being concentrated on the states of Alabama and Louisiana,'' the company said.

Already on the books are statutory capital investment tax credits that cover construction costs and income tax credits for up to 20 years.

Besides the proposed $750 million bond cap, Riley has reserved up to $900 million in tax incentives and bond provisions. That total comes under a 2005 federal law passed in reaction to hurricanes Katrina and Rita in Alabama, Louisiana and Mississippi.

The Gulf Opportunity Zone Act of 2005, or GO Zone, reserves $2.17 billion in tax exempt bond financing authority for Alabama. The $900 million is for "Project Compass'' in Mobile, which is believed to be the steel plant.

GO Zone bonds are attractive because money is borrowed at a reduced interest rate.

Riley said if "Project Compass'' falls through, he would consider releasing the $900 million for other projects.

"If they're not needed, we'll do something else,'' Riley said. "We've got a couple of other options out there, but we certainly wouldn't use all of it.''

At present, 11 counties in Alabama are eligible for GO Zone approval: Baldwin, Choctaw, Clarke, Greene, Hale, Marengo, Mobile, Pickens, Sumter, Tuscaloosa and Washington.

U.S. Sen. Richard Shelby, R-Ala., has been talking about expanding the number of eligible Alabama counties. An expansion could include Colbert and Lauderdale counties.

"The senator is aware that this is a priority for the governor and has discussed legislative options with him and his colleagues in Congress,'' Shelby spokeswoman Katie Boyd said. "But there is no concrete legislative proposal and at this time.''

Approved GO Zone projects include a $200 million request for a gas storage plant in Mobile County and $110 million for-the Alabama Housing Finance-Authority.

Authority Director Bob Strickland said if Riley releases any of the $900 million in reserve for the Mobile County steel plant project, it would free up more money for low-income home buyers in the 11 counties, and in turn, make more money available statewide.

Dana Beyerle can be reached at (334) 264-6605 or dtb12345@aol.com.