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Gas Tax increase on the fast track in Montgomery

Brandon Moseley

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By Brandon Moseley
Alabama Political Reporter

A number of powerful special interests spoke in favor of House Bill 487, which would raise taxes on the gas and diesel fuel that Alabamians purchase every day to commute to and from work, church, school, and play.

HB487 is sponsored by state Representative Bill Poole (R-Tuscaloosa). Rep. Poole spoke at a public hearing on HB487 in the Transportation, Utilities & Infrastructure Committee.

Rep. Poole told the committee, “This is a very important public policy piece of legislation. I ultimately came to the conclusion that this is the right thing to do for the economy of Alabama.”

Poole said, “We know we are falling behind neighboring states. The American Society of Engineers rate Alabama roads a D+. Over 15 million vehicles a day cross over bridges that are structurally deficient or are functionally obsolete. Driving around these bridges cost schools $2.5 million a year in additional costs to drive around those bridges.”

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Rep. Poole said that the fatality rate has doubled on rural roads and claimed that 1 in 3 fatal traffic accidents in the State are due in part to road conditions. Alabama last raised its gas tax in 1992. Fuel efficiency has improved 17.9 percent since 1990. That is a good thing but they are still traveling our roads. Meanwhile the cost of doing roadwork has gone up. Poole said that the State has coupled decreased revenue with increased costs of road construction.

Rep. Poole said that Alabama trails seven other southeastern states in funding for roads. “It is important that we invest in our success. We have a lot of road miles in relative to our peers and yet our funding trails other states.”

Poole said that his bill would also increase the price of a gallon of fuel four cents, effective September 2017, and two more cents, effective Sept 2019. Additionally, it would raise gas prices three cents per gallon, effective Sept 2024. The legislature can opt out of the third tax increase by a joint resolution of the legislature.

The Chairman of the Board of the Alabama Clean Fuels Coalition Phillip Wiedmeyer spokesman said we certainly the bill but not the details of the year tax it places on possessing an alternative fuel vehicle. The owner of a commercial alternative fuel vehicle would have to pay $150 a year under the bill. He said that the Committee needed to give them more time to settle this issue.

Former candidate for Congress Steve Raby was there as a lobbyist representing the City of Huntsville. Raby said that there are problems with the local portions. No municipality in a county can use more than 20 percent of the funding for that county. Montgomery has 90 percent of the residents of Montgomery County. Raby said that while he supports an infrastructure bill that Huntsville, Montgomery, and Birmingham are not being treated fairly in the distribution of the money. “We need to look at a more equitable split. This formula was put together in 1964.” 50 years ago and passing this bill would lock in place for another 25 years.

President and CEO of West Alabama Chamber of Commerce and President of the Alliance for Alabama Infrastructure (AAI) spoke in favor of the proposal. He said that it was a quality of life issue. The process that has gotten here the last few weeks has produced this bill from different proposals. We came together as a broad coalition. Rep. Poole has created a hybrid proposal. All the stakeholders gave a little to get this. This proposal addresses accountability first and foremost, it affects every single county and municipality in the state, and does not just address the needs of the major population centers.

Alabama League of Municipalities spokesman Greg Cochran said that he supports the concept but not locking all the proceeds into this formula which he called totally inadequate.

The spokesman for the Alabama Trucking Association said, “Trucks move 80 percent of the freight in Alabama. We pay more than 40 percent of the roads taxes in this state and we are willing to pay more.”

The Executive director of the Association of County Commissions of Alabama Sonny Brasfield said that he has been here since 1983 and any effort to change the distribution formula has failed. “We need to honor the existing distribution formula.”

David Cole with the Alabama Farmers Federation said that he is here speaking for 350,000 member families and we encourage you to vote yes.

The President and CEO of the powerful Business Council of Alabama (BCA) Billy Canary told the committee: “We have a decision to make. If you vote no what is your plan? We have tried to work in this broad coalition. If not now, then when? There are four things that bring jobs to our state: education and education reform, infrastructure, healthcare and healthcare reform, and right to work.”

The bill would allow the State to sell $2.5 billion in massive new bond debt to be paid through future revenues from the tax increase. Projects would have to be approved by the permanent ATRIP committee. Some inside sources have suggested that it would be dangerous for the State to take on more bond debt given the relative weakness of the economy and more pressing budget weaknesses.

HB487 received a favorable report.

Rep. Will Ainsworth (R-Guntersville) voted against the bill. He told reporters afterwards that he does not think that gas taxes are the proper model for road construction moving forward and that this is a tax on the people of Alabama.

State Senator Paul L Sanford said on Facebook afterwards, “9 cent gas tax on the move in the House. What about the $63mm we transfer away from DOT annually now? Over $400mm transferred away from building roads in order to fund other parts of government in recent years. Any guess on whether it was a voice vote?”

Legislative insiders told The Alabama Political Reporter that this bill is being fast tracked to the House floor on Thursday.

 

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House passes General Fund Budget

Brandon Moseley

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By Brandon Moseley
Alabama Political Reporter

The Alabama House of Representatives passed the state General Fund Budget on Tuesday.

The General Fund Budget for the 2019 fiscal year is Senate Bill 178. It is sponsored by Sen. Trip Pittman, R-Montrose. State Rep. Steve Clouse, R-Ozark, carried the budget on the House floor. Clouse chairs the House Ways and Means General Fund Committee.

Clouse said, “Last year we monetized the BP settlement money and held over $97 million to this year.”

Clouse said that the state is still trying to come up with a solution to the federal lawsuit over the state prisons. The Governor’s Office has made some progress after she took over from Gov. Robert Bentley. The supplemental we just passed added $30 million to prisons.

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The budget adds $50 million to the Department of Corrections.

Clouse said that the budget increased the money for prisons by $55,680,000 and includes $4.8 million to buy the privately-owned prison facility in Perry County.

Clouse said that the budget raises funding for the judicial system and raises the appropriation for the Forensic Sciences to $11.7 million.

The House passed a committee substitute so the Senate is either going to have to concur with the changes made by the House or a conference committee will have to be appointed. Clouse told reporters that he hoped that it did not have to go to conference.

Clouse said that the budget had added $860,000 to hire more Juvenile Probation Officers. After talking to officials with the court system that was cut in half in the amendment. The amendment also includes some wording the arbiters in the court lawsuit think we need.

The state General Fund Budget, SB178, passed 98-1.

Both budgets have now passed the Alabama House of Representatives.

The 2019 fiscal year begins on Oct. 1, 2018.

In addition to the SGF, the House also passed a supplemental appropriation for the current 2018 budget year. SB175 is also sponsored by Pittman and was carried by Clouse on the floor of the House.

SB175 includes $30 million in additional 2018 money for the Department of Corrections. The Departmental Emergency Fund, the Examiners of Public Accounts, the Insurance Department and Forensic Sciences received additional money.

Clouse said, “We knew dealing with the federal lawsuit was going to be expensive. We are adding $80 million to the Department of Corrections.”

State Representative Johnny Mack Morrow, R-Red Bay, said that state Department of Forensics was cut from $14 million to $9 million. “Why are we adding money for DA and courts if we don’t have money for forensics to provide evidence? if there is any agency in law enforcement or the court system that should be funded it is Forensics.”

The supplemental 2018 appropriation passed 80 to 1.

The House also passed SB203. It was sponsored by Pittman and was carried in the House by State Rep. Ken Johnson, R-Moulton. It raises securities and registration fees for agents and investment advisors. It increases the filing fees for certain management investment companies. Johnson said that those fees had not been adjusted since 2009.

The House also passed SB176, which is an annual appropriation for the Coalition Against Domestic Violence. The bill requires that the agency have an operations plan, audited financial statement, and quarterly and end of year reports. SB176 is sponsored by Pittman and was carried on the House floor by State Rep. Elaine Beech, D-Chatham.

The House passed Senate Bill 185 which gives state employees a cost of living increase in the 2019 budget beginning on October 1. It was sponsored by Sen. Clyde Chambliss, R-Prattville and was being carried on the House floor by state Rep. Dimitri Polizos, R-Montgomery.

Polizos said that this was the first raise for non-education state employees in nine years. It is a 3 percent raise.

SB185 passed 101-0.

Senate Bill 215 gives retired state employees a one time bonus check. SB215 is sponsored by Senator Gerald Dial, R-Lineville, and was carried on the House floor by state Rep. Kerry Rich, R-Guntersville.

Rich said that retired employees will get a bonus $1  for every month that they worked for the state. For employees who retired with 25 years of service that will be a $300 one time bonus. A 20-year retiree would get $240 and a 35-year employee would get $420.

SB215 passed the House 87-0.

The House passed Senate Bill 231, which is the appropriation bill increase amount to the Emergency Forest Fire and Insect and Disease Fund. SB231 is sponsored by Sen. Steve Livingston, R-Scottsboro, and was carried on the House floor by state Rep. Kyle South, R-Fayette.

State Rep. Elaine Beech, D-Chathom, said, “Thank you for bringing this bill my district is full of trees and you never know when a forest fire will hit.

SB231 passed 87-2.

The state of Alabama is unique among the states in that most of the money is earmarked for specific purposes allowing the Legislature little year-to-year flexibility in moving funds around.

The SGF includes appropriations for the Alabama Medicaid Agency, the courts, the Alabama Law Enforcement Agency, the Alabama Department of Corrections, mental health, and most state agencies that are no education related. The Alabama Department of Transportation gets their funding mostly from state fuel taxes.

The Legislature also gives ALEA a portion of the gas taxes. K-12 education, the two year college system, and all the universities get their state support from the education trust fund (ETF) budget. There are also billions of dollars in revenue that are earmarked for a variety of purposes that does not show up in the SGF or ETF budgets.

Examples of that include the Public Service Commission, which collects utility taxes from the industries that it regulates. The PSC is supported entirely by its own revenue streams and contributes $13 million to the SGF. The Secretary of State’s Office is entirely funded by its corporate filing and other fees and gets no SGF appropriation.

Clouse warned reporters that part of the reason this budget had so much money was due to the BP oil spill settlement that provided money for the 2018 budget and $97 million for the 2019 budget. Clouse said they elected to make a $13 million repayment to the Alabama Trust fund that was not due until 2020 but that is all that was held over for 2020.

Clouse predicted that the Legislature will have to make some hard decisions about revenue in next year’s session.

 

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Day Care bill delayed for second time on Senate floor, may be back Thursday

Sam Mattison

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By Samuel Mattison
Alabama Political Reporter

The day care bill, which would license certain day care centers in Alabama, was once again delayed on the state Senate floor after one lawmaker requested more information.

Its brief appearance Tuesday ended with state Sen. Gerald Dial, R-Lineville, saying a compromise had not yet been worked out with the bill’s detractors.

Alabama’s Senate has been hesitant to act on the legislation because of complaints of state Sen. Shay Shelnutt, R-Trussville, who has been an opponent of the bill since its introduction last year. The bill’s delay on Tuesday marks the second time its been taken off the Senate’s agenda.

The bill has had a rocky time in this year’s session, but the bill’s sponsor state Rep. Pebblin Warren, D-Tuskegee, said she is still confident about its passage out of the Legislature.

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Warren, D-Tuskegee, filed the bill this session with the support of influential lawmakers including Gov. Kay Ivey, who told reporters last year that she though all day cares should be licensed.

Mainly sparked by the death of 5-year-old boy in the care of a unlicensed day care worker, the bill had great momentum coming into this year’ session.

Despite the growing support from lawmakers, Religious groups had concerns that the bill would increase state-sponsored reach into religious day cares in churches and non-profit groups.

Spearheading the dissenters was Alabama Citizens Action Program, a conservative religious-based PAC.

Warren, proponents, and ALCAP announced a compromise to the bill while it was still in the Alabama House.

Announced by ALCAP originally, the new bill was a weaker version in that it did not require that all day cares in the state be regulated. Instead, religious-based day cares would only need to be registered if they received federal funds. At a Senate committee meeting in February, Warren said a similar requirement was about to come from federal law in Congress.

The bill moved through the House in a overwhelming vote in favor of the proposal and passed unanimously out of a Senate committee a few weeks ago.

Warren, speaking to reporters after its passage from the House, said she was unsure if the bill would encounter resistance in the upper chamber.

It was the Senate that killed the daycare bill last year amid a cramped last day where senators took the bill off the floor. The bill may face similar complications this year, as lawmakers seem to be preparing to adjourn within a few weeks.

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Fantasy sports bill fails on Senate floor

Sam Mattison

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By Samuel Mattison
Alabama Political Reporter

Would-be Fantasy Sports players in Alabama will have to wait to legally play in the state following a Senate vote on Tuesday.

The Alabama Senate decisively killed a bill to exempt fantasy sports from the state’s prohibition on gambling.

Not even entertaining a debate on the Senate floor, the proposal was killed during a vote for the Budget Isolation Resolution, which is usually a formality vote preluding a debate.

Fantasy sports are contests where participants select players from real teams to compete on fantasy teams using the real-world players’ stats.

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Since 2016, the practice has been illegal in Alabama following a legal decision by the Attorney General’s Office that categorized it as gambling.

The bill’s sponsor, state Sen. Paul Sanford, R-Huntsville, predicted the bill’s failure during a committee meeting two weeks ago, where the bill passed unanimously.

Sen. Paul Sanford speaks to reporters after a Senate Committee meeting on Feb. 28, 2018. (Samuel Mattison/APR)

Speaking to reporter’s after the committee meeting, Sanford said the decision to file the bill was mainly a philosophical belief that the practice shouldn’t be illegal.

Sanford, a fantasy sports player before its ban, said that fantasy sports are a way to bring people closer together and not a means to win money. The Huntsville senator is not seeking re-election.

The bill’s failure in the Senate follows its trajectory last year too. A similar version of the bill, also sponsored by Sanford, failed in the Senate during the final days of the 2017 Legislative Session.

Since Sanford is retiring, it is unclear if the bill will even come back next session, or if it will even have a Senate sponsor.

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Gas Tax increase on the fast track in Montgomery

by Brandon Moseley Read Time: 5 min
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