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Jefferson County Tax Increase Package Before the House

By Brandon Moseley
Alabama Political Reporter

Representative Jim McClendon (R) from Springville told ‘The Alabama Political Reporter’ Monday that the Jefferson County bailout bill will be in committee in the House on Tuesday.  Rep. McClendon expects that the bill will pass out of Committee and could be debated by the full Alabama House of Representatives as early as Wednesday.  The bill SB567, titled the Alabama Financially Distressed Counties Act, passed in the Alabama Senate by a margin of 16 to 11 on Thursday.

Rep. McClendon said, “This bill raises taxes.”  A lot of legislators ran on a platform that they would not vote for any tax increases.  The problem from my perspective is that they expect my folks in St. Clair County to pay this.

Senator Scott Beason (R) from Gardendale thought that legislative leaders should address the un-earmarking of funds first before any consideration of any kind of a tax increase.  Beason said that the county could access $millions from un-earmarking which should be done first.  Sen. Beason said that he was given very little notification prior to this bill being brought up in the Alabama Senate.

We asked Senator Beason if a doctor who had his office in St. Clair County but who did surgeries in Jefferson County at UAB would have to pay the occupation the tax on the surgeries but not the office visits.  Likewise a surgeon with an office in Jefferson County, but who performed surgeries at St. Vincent’s of St. Clair would have to pay the tax on the office visits but not on the surgeries.  In theory, accountants for professionals who do business in Jefferson County might have to keep separate records for when they were doing work within the county (thus owing the occupation tax) and when they were working on the other side of a county line (thus not owing a Jefferson County occupation tax).  Sen. Beason told ‘The Alabama Political Reporter’ that he thought that our interpretation of the bill was correct, “but I didn’t write the bill and I don’t know how they envision how that bill will work.”

Rep. McClendon said the legislature passed a penny sales tax to support Cooper Green in ~1970 and that the passage of Medicaid and Medicare alleviated the need for that tax and for Cooper Green Hospital then.  McClendon suggested that removing the subsidies for Cooper Green Hospital and applying that penny sales tax to the Jefferson County operating budget and to the debt was preferable to passing the massive tax increase.

Sen. Beason said that he contested the bill in the legislature last year and he believed that the people who want higher taxes on everyone went around the Jefferson County delegation and ran this tax increase as a general statewide bill because they did not want anyone on the Jefferson County delegation having the ability to hold this bill up.

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Beason said that the tax increase was a huge departure for the way that conservatives think.  The Gardendale Senator said that Jefferson County should solve its spending problem before asking for any tax increases.  Sen. Beason said, “I am most disappointed” with how this was handled in the Alabama Senate.

Rep. McClendon said that the people in St. Clair County he represents shouldn’t have to pay taxes to bail out Jefferson County and if the Jefferson County Occupation tax went to the floor of the House he was “ready for a floor fight.”

The massive tax increase package gives the Jefferson County commission unprecedented new powers to raise taxes on workers’ pay checks.  It also gives the Jefferson County Commission the power to raise sales taxes countywide by as much as 1% once the current educations sales tax sunsets.  It also gives the Commission sweeping new powers to raise gasoline taxes, rental taxes, storage taxes, and applies the occupation tax to licensed professionals like doctors, lawyers, CPAs, engineers, etc. for a total of about $62 million in anticipated revenues.

Rep. McClendon said that the Legislature would likely address redistricting and legislative reapportionment starting on May the 14th.  McClendon said that the legislature had plenty of time left in the session to address the Jefferson County situation, pass redistricting, and pass both budgets by time the session ends on May 21.

Brandon Moseley is a former reporter at the Alabama Political Reporter.


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