Connect with us

News

State Weighs Budget Options

Brandon Moseley

Published

on

By Brandon Moseley
Alabama Political Reporter

On Friday, February 13, Alabama Governor Robert Bentley (R) shocked everyone who follows Alabama politics when he announced in a speech in Birmingham that he plans to spend the next four years of his second term raising taxes on the people of Alabama.

Gov. Bentley said that the State is facing a projected $265 shortfall in the general fund budget for the 2016 fiscal year beginning on October 1. On top of that Bentley said that Alabama owes the federal government $272 million because the people at Alabama Medicaid made some mistakes in the program. The State also owes the federal government $53 million on the CHIPs (Children Health Insurance Program) and need to spend another $40 or 50 million a year to prevent President Obama’s (D) Department of Justice or a federal judge from taking over the state’s vastly over crowded prison system.

The Governor also said that the State currently takes $187 million out of the education fund to prop up the General fund and takes $65 million from the Alabama Department of Transportation to prop up the courts and the Alabama Department of Public Safety. Bentley would like to restore those money’s to education and roads.

Gov. Bentley said, “I am not going to be a governor who pushes problems aside.” The governor acknowledged that these problems are not new. “We have been doing things in a dysfunctional way.” “The next four years we are going to raise taxes.” Gov. Bentley said, “We have to face the problems and we have to do it with boldness.” “I am going to present a plan to the legislature to do it. I am going to push for it.”

We have not seen the Governor’s plan yet, but a number of ideas to produce the necessary revenue have been circulating around Montgomery.

ADVERTISEMENT

These include raising the State’s sales tax another 1 percent. This would raise an estimated $307 million. Supporters like sales taxes because everybody pays and they capture money from the underground economy. Critics claim that sales taxes his the poor the hardest because they spend all of their incomes, while the wealthy reinvest far larger proportions of what they make.

Going after internet sales would raise an estimated $255 million, but only part of that money is currently earmarked for the general fund, where escalated Medicaid costs due to Obamacare and a sluggish economy making more Alabamians eligible for free healthcare has been eating up a larger and larger share of the state budget. Making more internet retailers collect the sales tax would also require congressional assistance, which could be difficult with the most Republican Congress since World War II

Raising taxes on tobacco, alcohol, and soft drinks are another option that has been discussed. Again that would be paying to grow State government on the backs of the people’s bad habits and would likely anger the beverage and tobacco lobbies, likely without raising nearly the amount of money that Bentley claims he needs.

The State could raise the tax on homeowners and property owners. Higher property taxes would generate up to another $500 million; but would have to be approved by the voters of Alabama. Will the public agree to pay more tribute to state government just for nicer prisons and so hospitals can profit off of Medicaid’s largesse?

Public Service Announcement

While no one has proposed raising the income tax rate, many people in the administration have suggested stripping the people of their mortgage interest, charitable contribution, federal income tax, and/or personal exemption deductions. Those changes to the Alabama Tax code could make the State: $252 million, $174 million, $532 million, and $182 million respectively. Any of those changes would effectively mean that the people of Alabama pay higher income taxes; but the State income tax is earmarked for education, not the general fund where the State needs the money. To divert that money to the troubled general fund would likely require a vote of the people and no one we talked to believe that the people are eager to take home much smaller paychecks each week.

State Representative John Knight (D-Montgomery) has championed eliminating the federal payroll tax deduction for years; but he has wanted to do that in order to take the sales tax off of food without the state losing any revenue. Under our current understanding of the Bentley proposal the people would still pay the tax on their food; they just also would have less take home pay to spend at the grocery store; because Alabama took more of it.

Some in the legislature have suggested reducing what the state pays into the Retirement Systems of Alabama (RSA). This could potentially save as much as $550 million a year, but would likely mean that future state retirees would no longer have the guaranteed retirement benefits. That is much more complex than simply switching to 401ks or annuities and likely would come with some up front costs and likely would only apply to new hires, thus the benefit would likely be deferred into the future and would likely not help this year…..and it would be politically difficult in the long run.

Some have suggested selling the State’s liquor store business. That would likely generate a one time windfall of $75 million; but could actually result in lower income going forward; though removing those ABC store employees from the State retirement and health benefits could save the State money as well.

Cutting the medical and dental deduction could generate another $42 million. Eliminating the personal deduction in lieu of itemizing could generate an estimated $182 million. Again most people would pay higher income taxes.

Some have proposed raising gas taxes by $200 to $300 million; but with improving fuel economy of newer vehicles those revenues are likely to decline over time.

The Governor has reportedly rejected any legalization of gambling; but a compact with the Poarch Creek Indians could generate an estimated $50 to $150 million a year and would be largely just an acceptance of the status quo.

Some have suggested legalizing slot machines or adding a State lottery; but critics dismiss that as just a tax on people who can’t do math and question whether the social costs of more gambling addicts isn’t more than the tax revenue generated.

The legislature will have to either implement some version of the soon to be revealed Bentley plan, adopt their own revenue plan, or cut the budget so that the State can live within its current revenues; like Gov. Riley and the then Democrat controlled legislature were force to do when the people of Alabama rejected their $ billion amendment one plan in 2003.

Brandon Moseley is a senior reporter with eight and a half years at Alabama Political Reporter. You can email him at [email protected] or follow him on Facebook. Brandon is a native of Moody, Alabama, a graduate of Auburn University, and a seventh generation Alabamian.

Advertisement

National

Roby warns Americans to be careful this Thanksgiving

Congresswoman Roby urged Alabamians to adjust Thanksgiving holiday activities to avoid spreading the coronavirus.

Brandon Moseley

Published

on

Congresswoman Martha Roby, R-Alabama

Congresswoman Martha Roby, R-Alabama, warned Alabamians to adjust their Thanksgiving holiday activities to avoid spreading the coronavirus.

“Thanksgiving is a special holiday because it provides us an entire day each year to pause and give thanks for the many blessings we have received,” Roby said. “Particularly amid a global pandemic, the stress and craziness of life often make it easy to lose sight of just how much we have to be thankful for. Whether you are gathering with loved ones or remaining in the comfort of your own home, I hope we all take time to celebrate gratitude – something we may not do enough of these days.”

“As we’ve learned to adjust our daily routines and activities throughout the course of this pandemic, we know this Thanksgiving will not look like those of the past,” Roby said. “Please be mindful of any safety measures and precautions that have been put in place to help protect your family and those around you. The Alabama Department of Public Health (ADPH) released guidance that includes a list of low, moderate, and high-risk activities in order to help Alabamians have a safer holiday season. ADPH suggests a few lower risk activities such as having a small dinner with members of your household, preparing and safely delivering meals to family and neighbors who are at high-risk, or hosting a virtual dinner with friends.”

Congressman Robert Aderholt, R-Alabama, echoed Roby’s warning to be safe this Thanksgiving holiday.

Aderholt said: “I want to wish you and your loved ones a Happy Thanksgiving! I hope Thursday is filled with a lot of laughter and gratitude, and that you can share it with friends and family. And while we continue to navigate this Coronavirus pandemic, please stay safe this holiday season.”

On Thursday, the CDC encouraged families to stay home as much as possible over the holiday weekend and avoid spreading the coronavirus.

ADVERTISEMENT

“As cases continue to increase rapidly across the United States, the safest way to celebrate Thanksgiving is to celebrate at home with the people you live with,” the CDC said in a statement before the holiday. “Gatherings with family and friends who do not live with you can increase the chances of getting or spreading COVID-19 or the flu.”

The CDC has updated its guidelines to encourage families to stay home during the holiday.

  • The CDC said that postponing Thanksgiving travel is the “best way to protect” against the virus.
  • If you are sick or anyone in your household is sick, whether you think it is COVID or not, do not travel.
  • If you are considering traveling for Thanksgiving, avoid traveling to locations where virus activity is high or increasing.
  • Avoid travel to areas where hospitals are already overwhelmed with patients who have COVID-19.
  • Try to avoid traveling by bus, train or airplane, where staying 6 feet apart is difficult.
  • Avoid traveling with people who don’t live with you.
  • You should consider making other plans, such as hosting a virtual gathering or delaying travel until the vaccine is available or the pandemic is more under control.
  • Discuss with your family and friends the risks of traveling for Thanksgiving.
  • Try to dissuade people from visiting this holiday.
  • If you do travel, check for travel restrictions before you go and get your flu shot before you travel.
  • Always wear a mask in public settings, when using public transportation, and when around people with whom you don’t live.
  • Stay at least 6 feet apart from anyone who does not live with you.
  • Wash your hands often or use hand sanitizer.
  • Avoid touching your mask, eyes, nose and mouth.
  • Bring extra supplies, such as masks and hand sanitizer.
  • When you wear the mask, make sure that it covers your nose and mouth and secure it under your chin.

Remember that people without symptoms may still be infected, and if so, are still able to spread COVID-19. Remember to always social distance. This is especially important for people who are at higher risk of getting very sick. Keep hand sanitizer with you and use it when you are unable to wash your hands. Use a hand sanitizer with at least 60 percent alcohol.

Try to also avoid live sporting events, Thanksgiving Day parades and Black Friday shopping this year.

Public Service Announcement

Roby represents Alabama’s 2nd Congressional District and will be retiring at the end of the year. Aderholt represents Alabama’s 4th Congressional District and was re-elected to the 117th Congress.

Continue Reading

Bill Britt

Opinion | Let’s hope for Reed’s success

Reed’s temperament and style appear right for this moment in Alabama’s history.

Bill Britt

Published

on

State Sen. Greg Reed has been chosen as the next president pro tem of the Alabama State Senate.

State Sen. Greg Reed, R-Jasper, will lead the Alabama Senate as president pro tem during the upcoming 2021 legislative session. What changes will Reed bring to the upper chamber, and how will his leadership differ from his predecessor? No one knows for sure.

Reed succeeds Sen. Del Marsh, who has served as president pro tem since Republicans took control of the Statehouse in 2010. Marsh, along with then-Gov. Bob Riley, current felon Mike Hubbard and ousted BCA Chair Billy Canary orchestrated the 2010 takeover that saw the Republican rise to dominance.

Reed, who won his Senate seat the same year, was not a charter member of the Republican ruling class, but he benefited from the power sift.

Mild-mannered and studious with a quiet charm, Reed has steadily ascended the ranks of Senate leadership. His silver hair and calm determination have served him well. Reed is a senatorial figure straight out of Hollywood’s central casting.

In all, Reed is nearly universally liked and respected, which in the near term is a hopeful sign of potential success. But political leadership always comes with a warning: “Friends come and go, enemies accumulate.”

Reed’s relationship with Gov. Kay Ivey is certainly less contentious than Marsh’s and gives rise to the belief that there will be greater cooperation between the executive and the Senate.

ADVERTISEMENT

With the economy and public health under dire stress due to the ravages of COVID-19, legislative priorities are fixed: get people back to work and eradicate the coronavirus.

However, one of Reed’s first tests will be whether he can cool the smoldering anger of those senators who still feel the sting of Ivey’s rebuke over the allocation of CARES Act funds. He will also need to resist those who want to punish the administration over its use of public health statutes to implement mask mandates and other safety measures to prevent the deadly coronavirus spread.

Despite outward declarations of a unified body, the State Senate is a small, insular and unwieldy beast where egos loom large and consensus on policies is often tricky to achieve except on “red meat issues.”

Building a coalition on policy in the Senate is often a combination of horse-trading, cajoling and carefully applied pressure. The way forward in the near term is exact: pass legislation that spurs economic recovery and mitigates the health crisis at hand.

Public Service Announcement

But Reed will also simultaneously need to recognize what comes next for justice reform, prison construction, gambling and a myriad of other pressing issues. His job will be to understand the prevailing winds, which are evolutionary, not revolutionary.

As author Doris Kearns Goodwin noted in Lyndon Johnson and the American Dream: “For political leaders in a democracy are not revolutionaries or leaders of creative thought. The best of them are those who respond wisely to changes and movements already underway. The worst, the least successful, are those who respond badly or not at all, and those who misunderstand the direction of already visible change.”

Reed’s temperament and style appear right for this moment in Alabama’s history.

As President Abraham Lincoln said, “If you want to test a man’s character, give him power.”

Let’s all hope that Reed passes the test.

Continue Reading

News

Aderholt introduces broadband-focused EXPAND Act

The COVID-19 pandemic has showcased the critical need for efficient and reliable rural broadband, Aderholt said.

Brandon Moseley

Published

on

(STOCK PHOTO)

Congressman Robert Aderholt, R-Alabama, on Tuesday released new rural broadband legislation, the Enabling Extra Time to Extend Network Deployment (EXTEND) Act.

“The COVID-19 pandemic has showcased the critical need for efficient and reliable rural broadband. Teleworking, telemedicine, and virtual classrooms have been our reality for the better part of eight months, and it could continue into the new year,” Aderholt said. “Since Congress has passed stimulus funding for Coronavirus relief, I believe states should be allowed to use that money to address this dire need.”

Alabama currently has hundreds of millions of dollars in CARES Act dollars that the federal government sent to the state in March, but there were so many conditions on how the money could be spent that the state has been unable to find acceptable uses for most of those funds and may have to return that money to the federal government unspent early next year. Aderholt’s legislation would free up those dollars for use expanding rural broadband in Alabama.

“That is why I introduced a bill today to do just that, secure the ability for states to expand their rural broadband infrastructure with Coronavirus relief funds,” Aderholt said. “This bill will help those rural areas that have been left behind by providing a pathway for states to determine which areas are particularly underserved, while also preventing overbuilding in areas where broadband access is widespread.”

“I am hopeful that this legislation will set a precedent for future funding bills, ensuring that rural areas have access to funds to build out the broadband infrastructure they need, while also preventing waste and abuse,” Aderholt said. “It’s clear that adequate funding is needed now more than ever, and ensuring states the option to use Congressionally approved stimulus money for this issue is a step in the right direction.”

Rep. Bob Latta, R-Ohio, is the lead co-sponsor on the EXPAND Act.

ADVERTISEMENT

“When Americans can’t access the Internet, they aren’t able to participate in our 21st century economy, learn remotely, or communicate with others outside of their communities, all of which have become increasingly important during the COVID-19 pandemic,” Latta said. “The EXTEND Act works to support the buildout of broadband infrastructure in areas that do not currently have broadband capabilities. It ensures funds from the CARES Act, which I supported earlier this year, can be granted by states for the deployment of broadband so all Americans, including people living in rural communities, have reliable internet connectivity. I’d like to thank my colleague Rep. Aderholt for his attention to this critical issue, and I am encouraged that with this bill, we are working towards a more connected future.”

Aderholt was recently overwhelmingly elected to his 13th term representing Alabama’s 4th Congressional District.

“I would also like to take a moment to thank you for sending me back to Washington, D.C. to serve as your Representative for Alabama’s 4th Congressional District,” Aderholt said. “It is an incredible honor to serve you in Congress, and it is a responsibility I do not take lightly. And no matter how you voted in this election, I promise to fight for you, and for everyone in our district, in the halls of Congress.”

Continue Reading

Governor

Governor orders flags lowered in honor of former Rep. Alvin Holmes

Ivey’s directive calls for flags to be lowered on Sunday when Holmes is to be buried.

Eddie Burkhalter

Published

on

(STOCK PHOTO)

Gov. Kay Ivey on Tuesday ordered the flags at the State Capitol and in State House District 78 to be lowered to half-staff in honor of former State Rep. Alvin Holmes, a tireless advocate for the Black community who served in the House for 44 years. 

Holmes, 81, died Saturday. Ivey’s directive calls for flags to be lowered on Sunday when Holmes is to be buried and remain lowered until sunset that day. 

“A native of Montgomery, Rep. Holmes served the people of Alabama in the House of Representatives for 44 years,” Ivey wrote in her directive. “As the longest-serving representative in our state’s history, it is only fitting that we pay homage to his decades of dedicated service. Anyone that had the privilege of working with or hearing Rep. Holmes address the legislature, knows that he was passionate about his work and cared deeply about improving our state, specifically in matters regarding civil rights. His unique approach to conveying the importance of causes he supported garnered much respect from his colleagues and is something the people of our state will not soon forget. I offer my sincere condolences and prayers to his family, friends and constituents of his beloved community.”

A caravan honoring Holmes took place in Montgomery on Monday.

State Rep. Chris England, D-Tuscaloosa, the chairman of the Alabama Democratic Party, released a statement mourning Holmes’s passing.

“Representative Alvin Holmes was a great Democrat and a fighter,” England said. “He stood on the frontlines of the fight for civil rights and was willing to sacrifice everything in his fight for justice for all. He not only had a long and distinguished career as a civil rights leader, but also as a member of the Legislature, serving his constituents faithfully and dutifully for 44 years. Alabama has lost a giant, whose wit, intelligence, fearlessness, selfless determination, and leadership will be sorely missed. My prayers are with his friends, family, and colleagues.”

ADVERTISEMENT

Continue Reading
Advertisement
Advertisement