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Attorney General OKs withholding millions from educators

Bill Britt

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By Bill Britt
Alabama Political Reporter

Quietly under cover of so-called attorney-client privilege, educators are being denied millions of dollars, and the state’s Open Meetings Act is in jeopardy.

The Alabama Education Association recently celebrated winning a lawsuit alleging the Retirement System of Alabama’s PEEHIP Board met illegally to improperly raise state employees’ health insurance rates – PEEHIP is short for Public Education Employees’ Health Insurance Plan, which provides health coverage to education workers.

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Montgomery County Judge Johnny Hardwick’s ruling means around $60 million must be returned to education workers immediately.

A majority of PEEHIP Board members do not want to challenge Judge Hardwick’s decision by appealing the case. However, Leura Canary, chief legal counsel for the Retirement Systems of Alabama is threatening board members who openly express their willingness to drop the case. She is joined by Attorney General Steve Marshall and Gov. Kay Ivey’s “chief” legal counsel to withhold educators’ money hoping to reverse Judge Hardwick’s ruling before a “friendly” appellate court.

According to those close to the situation, Canary sent “threatening,” emails to Board members warning them not to interfere with her plans to appeal. Marshall assured Canary she had sole discretion on such legal matters and that, as a deputy attorney general, has his full backing to move forward with the appeal despite the wishes of the PEEHIP Board.

(Mrs. Canary is the wife of Billy Canary, the embattled CEO of the Business Council of Alabama.)

Speaking on background, a high ranking public official said, “Steve Marshall says Leura has the ability to intercede, and that even PEEHIP can’t say a word about it on litigation.” The member further stated, “Steve [Marshall] is essentially, if this sticks, going to single-handedly undermine and probably bring down the entire Open Meeting Act.”

Ivey’s legal counsel, Bryan Taylor, is refusing to turn over public documents, keeping the public and especially educators from discovering Marshall and Canary’s intentions.

In 2016, the Board voted to increase educators’ insurance premiums by $80 a month. Overall, the increase doubled the average monthly premium for individuals from $15 to $30. The change also increased the average family premium — not including the spouse — increased $30 from $177 to $207. as previously reported by Chip Brownlee for APR.

Judge rules in favor of AEA in PEEHIP lawsuit, striking down health insurance rate hike

On April 27, 2016, the PEEHIP Board held two meetings. One was held at 1 p.m., which was open to the public as required by the Open Meetings Act, and another was held earlier at 9 a.m., where the rate increases were decided on contrary to state statute.

Judge Hardwick found the 9 a.m. meeting violated the state’s Open Meetings Act, and therefore the premium increase was illegally enacted.

Several Board members say they don’t understand why Canary and Marshall are superseding their authority. But as explained in the letter from Marshall’s man, the attorney general has power over all state litigation.

A letter copied to all board members believed to be the result of Canary’s consolation with Marshall reads in part, “The PEEHIP board does not have the legal authority to direct the positions taken on issues in litigation involving a state entity. That authority rests solely with lawyers who represent the State of Alabama and is accomplished through the actions of Deputy Attorneys General appointed to handle the case. This is the reason the PEEHIP board does not vote on litigation matters.”

“If that’s the case, then essentially, the attorney general, who’s political, could force every single state agency to be at their mercy,” said a source close to the case. “Even if it’s not in the agency’s best interest, the attorney general can overrule them. That’s crazy.”

Speculation holds that Canary may have hoodwinked Marshall, or that he is so desperate to win the attorney general’s race he is cozying up to Canary to encourage her husband to support his candidacy. Others suppose Marshall, a former Democrat appointed to district attorney by former Gov. Don Siegelman, is polishing his Republican credentials by targeting the AEA, a popular whipping-boy among the state’s GOP leadership.

Board members tell APR they want to drop the case and return the funds to the educators, however, they can’t find relief due to Marshall, and Canary’s interference.

Billy Canary, along with former Gov. Bob Riley and former House Speaker and convicted felon Mike Hubbard, waged war on the AEA until the once powerful association was beaten into submission. Meanwhile, BCA’s competing education organization has pushed legislation that has allowed Riley’s SGO to divert millions from education under the controversial Accountability Act.

As one attorney advised APR, the board should call a meeting and vote to overturn the original decision. “They should immediately stop the money from going into escrow, and stop collecting it. In the same meeting, the board should vote to draft a resolution to Steve Marshall that they believe that – that the Open Meetings Act was violated, and ask him to allow them to drop the appeal and refund the money.”

For now, Marshall, Canary and Taylor stand in the way of the Board’s actions, and by doing so, deprive thousands of individuals who work in education millions in repayment.

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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.

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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.

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.

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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.

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.

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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.

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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Attorney General OKs withholding millions from educators

by Bill Britt Read Time: 4 min
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