Reportedly, the State of Alabama is collecting more in tax money than it has obligated in its budgets.

With nearly $10 billion in the Education Trust Fund, an amount growing by the day, and only $9 billion in obligations, the state's policymakers face a unique situation: what to do with a surplus.

State Sen. Arthur Orr (R-Decatur), the Senate Education Budget Committee chairman, had previously floated the idea of one-time tax rebates.

However, during an interview with Mobile radio FM Talk 106.5's "The Jeff Poor Show" on Monday, the Morgan County lawmaker said it was possible for both a one-time rebate and some form of permanent tax relief.

"I think there are a lot of options out there," Orr said. "I think you said it correctly. There are, I think, rebates, I think, tax cuts. I think we can afford both. The numbers we're seeing today, the tax cuts, I think, are in order. I think we can still work on trying to raise the amount of tax-free money that people with 401(k)s and IRAs can withdraw tax-free. I think there are other things we can do with the tax rate. Now you pay your first couple of thousand dollars that you make, you pay 2%. Then it goes to 3%, 4% – you know, kind of stairsteps up. There are things we can do there on the tax code. Maybe get rid of some of that complexity and maybe permanently sending money back to the people.

"And then, I think the rebates are powerful. This is one-time money. Let's be clear about that. And because it is one-time money, we do need to be careful. It's a one-time phenomenon. Those who have been watching Mongomery for decades say, 'We'll retreat to the norm or to the mean. We need to share some of that with the people and the taxpayers, give it back to them, let them spend it how they will. But the idea we're going to overshoot ourselves or overcommit – we just need to be careful about this one-time phenomenon."

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