The Senate passed legislation on Thursday creating a "revolving loan" program for distressed colleges in Alabama.
Under Senate Bill 278, the program would be administered by the State Treasurer. Colleges eligible must have operated in the state for over 50 years, are experiencing financial hardship, which could lead to closure of the institution and have assets sufficient to pledge as collateral.
The legislation doesn't specifically mention the private Birmingham-Southern College, but it was evident on Thursday the legislation was written with the school in mind. The bill was filed on Tuesday, passed a Senate committee on Wednesday, and passed the Senate on Thursday. The school was seeking a $30 million bailout from the state earlier in the year.
$30 million is earmarked for the loan program in the education supplemental budget passed by the Senate Thursday.
The bill's sponsor, State Sen. Jabo Waggoner (R-Vestavia Hills), said on the Senate floor on Thursday, "This is the law we need to save Birmingham-Southern College."
"This is the bill that pertains to saving Birmingham-Southern College. This college is over 100 years old," Waggoner said. "It sits on a campus in West Birmingham of probably 200 acres. Many, many people in Alabama and all over the country have attended Birmingham-Southern and I'm one of them. Probably the only Birmingham-Southern alumni in the Senate. Several years ago they fell on some hard times and this is a bill to help them survive. It's a great institution. This is a bill that will hopefully protect them for the years to come."
State Sen. Larry Stutts (R-Tuscumbia) asked Waggoner about the general terms of the loans offered through the program.
"I know it's not specific to Birmingham-Southern, but I assume that's going to be the first loan out of this fund," Stutts said.
Waggoner said the State Treasurer's Office would "set the rules and the regulation so a lot of the responsibility is going to be on the Office of the State Treasurer to make these decisions."
According to a fiscal note attached to the legislation, the bill "provides that proceeds from the loan repayments would be deposited into the fund and that any monies remaining in the fund at the end of the fiscal year shall not revert and shall be reappropriated for the purposes of the program."
The bill now heads to the House Ways and Means Education Committee for consideration.
To connect with the author of this story or to comment, email caleb.taylor@1819News.com.
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