Alabama Taxes

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Teachers' lobbyist Paul Hubbert won a fight with Gov. Bob Riley's administration over earmarking some money from the $1.2 billion tax package to be used to prevent future cuts to the education budget.

The House Education Finance and Appropriations Committee changed a proposed constitutional amendment to designate a percentage of the increases from the tax package to go to the education budget in slow economic years.

Riley has requested that all new money from the package, which raises income and property taxes, go into an Alabama Excellence Initiative Fund and not be earmarked for specific purposes.

Riley's finance director, Drayton Nabers, said the change could endanger Riley's tax package, which is expected to raise enough money to fill a $675 million hole in the state's budgets next year and provide additional money for future years.

Nabers declined to elaborate when asked if Riley might withdraw his entire package if the change remains.

The income tax and property tax bills, as well as the constitutional amendment, moved to the House floor Friday.