Ala. Code § 33-2-182

Subject to the provisions contained in this article, the department may from time to time sell and issue its refunding bonds for the purpose of refunding any or all of the outstanding bonds then outstanding, together with any interest thereon whether due and unpaid at the time of issuance of such refunding bonds or not, and with any premium that may be necessary to be paid in order to redeem or retire those outstanding bonds proposed to be refunded.

In the discretion of the department, with the approval of the Governor, refunding bonds may be issued in exchange for outstanding bonds or they may be sold and the proceeds thereof applied to the purchase, redemption or payment of outstanding bonds. Refunding bonds to be issued in exchange for outstanding bonds may be issued in such principal amount as the department shall determine. Refunding bonds to be sold may be issued in such principal amount as shall be determined by the department, provided that such refunding bonds shall not be sold and issued in an aggregate principal amount exceeding the sum of (i) the outstanding principal amount of the outstanding bonds to be refunded, (ii) the interest accrued and to accrue on the outstanding bonds to be refunded until the respective maturities thereof, or if the outstanding bonds to be refunded are to be called for redemption (either on the earliest date on which under their terms they may be redeemed or some later date or dates), the interest accrued and to accrue thereon until the date or dates on which they are to be called for redemption, (iii) the amount of any redemption premium required, by the terms of the outstanding bonds, to be paid as a condition to their redemption prior to their respective maturities, (iv) the amount, if any, required to be deposited in an interest account or a reserve account, and (v) the amount of any expenses (actual or estimated) of such refunding, including without limitation, the expenses of selling and issuing the refunding bonds (including any discount reflected in the purchase price thereof paid to the department), bond insurance premiums, fees and disbursements of attorneys, accountants, financial advisors and other consultants, fees and disbursements of trustees and escrow agents, printing costs and other customary bond issuance expenses.