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Conservative Opposition to Gaming and Tax Plans (Opinion)

By Brandon Moseley
Alabama Political Reporter

GOP candidate after GOP candidate running for office in 2014 said that they were for limited government, rightsizing government, and no new taxes, yet here we are a few months later and now GOP leaders are telling us that we need new revenues.  Nobody much talked about the revenue issue during last year’s election that has dominated this year’s legislative session.

Alabama Governor Robert Bentley (R) is pushing a plan that would take an additional $541 million a year in from the private sector. Speaker of the House Mike Hubbard (R from Auburn) is proposing over $100 million in new taxes and giving the Poarch Creek Indians a statewide gaming monopoly in exchange for a $250 million one-time windfall payment to balance the general fund.  Even Senate President Pro Tem Del Marsh (R from Anniston) has gotten on the new revenue bus proposing: a state lottery, opening up casinos at Victoryland, Greenetrack, the Birmingham Race Course, and the Mobile Dog Track to Class III gaming as well as the Governor  signing a compact with the Poarch Creek Indians.

On Wednesday, May 6 the Alabama Political Reporter asked former State Senator Scott Beason (R-Gardendale) when did Alabama Republicans started running for office promising higher taxes and expanding gambling in the State?  Sen. Beason said that he has been in Alabama politics for a long time and he has never seen anything like it.  Beason said he could not recall any GOP candidates ever having success by promoting higher taxes and gambling expansion.

Former Alabama Republican Party Chairman Bill Armistead said in a statement on Facebook, “If I told you 6 months ago that Alabama’s Republican Governor, Speaker of the House and President Pro Tem of the Senate would each have a separate plan to increase government spending by proposing tax increases, a lottery and casino gambling, most people would say I had lost my mind. But, that is what is happening. If you are opposed to these Democrat ideas you should contact your legislator and tell them to oppose these liberal ideas.”

Time is running out on this legislative session.  Under the arcane rules of the legislature, if the Governor’s tax proposals are not considered by this week in Committee they are dead for the Session and they are not on any committee schedule we have seen to this point. That will effectively eliminate Governor Bentley’s fantasy revenue plan without it visiting the floor of either House. Gov. Bentley failed to sit down with legislative leaders before this session and craft any sort of plan together. Instead legislators were forced to read about the Governor’s legislation in the press like everybody else. Threatening the legislators if they did not bow down to his demands has not won over many hearts and minds in Montgomery and it appears that the death of his unpopular tax plan is a result of this failure to communicate. Undaunted the Governor is threatening to bring everyone back for multiple special sessions if he does not get his money.

That leaves the Marsh gambling expansion plan and the Hubbard plan to give the Poarch band of Creek Indians a monopoly and raise a number of taxes for a total of over a $100 million. Speaker Mike Hubbard’s plan is on very shaky legal footing and if passed is almost certainly going to be challenged in the courts on state constitutional grounds. The only reason that plan is making any traction is that it has the backing of the powerful Speaker of the House: Rep. Mike Hubbard (R-Auburn).  Speaker Hubbard through sheer force of will has moved his package of tax increases through Committee and they will be considered on the House floor next week.  Speaker Hubbard has accepted a Poarch Creek offer of $250 million for a gaming monopoly that would bring Class III gaming to the Indians’ casinos in Wetumpka, Montgomery, and Atmore.  The Indians have reportedly also suggested that they might be willing to add a casino somewhere North Alabama casino to help with economic development there.

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The tax increases are very unpopular with legislators and faces stiff opposition in the Senate. Many legislators speaking off the record have expressed reservations about giving anyone a gaming monopoly.  The popular Speaker’s influence may be waning due to his approaching criminal trial on 23 counts of felony ethics violations. If convicted, a new Speaker will have to deal with this budget mess before 2017 rolls around.

Voice of Alabama Politics Pundit and talk radio host Baron Coleman wrote recently, “It’s unclear what Republicans in the lower chamber are thinking by going along with Speaker Hubbard’s plan. Many legal experts believe Hubbard will be watching the 2018 elections from the comfort of a 10×6 cell in one of our state’s overcrowded and underfunded resorts for the criminally-inclined. He has nothing to lose.”

Hubbard will likely have to gain the support of House Democrats for cloture votes on his bills next week during what are expected to be marathon House sessions.

Senate President Pro Tem Del Marsh (R-Anniston) has borrowed his plan from ideas originally put forward by the House Democratic Caucus.  The Marsh/Democrats plan would fund the general fund with a state lottery, class III gaming at the three Indian casinos, as well as at the four dog tracks in Birmingham, Greene County, Mobile, and Shorter.  The Marsh plan would require a referendum of the voters because it is a Constitutional Amendment.  The Marsh plan does not include new taxes or a $250 million one time payment so the estimated $261 million hole in next year’s budget will likely not be fully addressed though some legislators have suggested borrowing money to carry the state over until the gambling revenues come in, though Marsh himself has suggested that the state tighten its belt to get through the gap.

On Tuesday, May 5 the Alabama Political Reporter asked Marsh why if we are going to open Alabama up to gambling, why we don’t we go to Las Vegas and sit down with all the players in that business and invite them to all bring their proposals to Alabama.  You say that Mike Hubbard’s plan would create a monopoly; but your plan creates a cartel of Milton McGregor, Greentrack, the Poarch Creek Indians, and the ownership of the Mobile Dog Track, why not let the gaming commission decide who gets these licenses?

Sen. Marsh replied I have no problem with that.  If somebody wants to bring that amendment on the floor I am willing to change it.  Marsh said that his plan gives 20 year deals for those already in the state but if the gaming commission wants to bid it out in ten years he is open to that.  “I want the best possible bill.”  I am open to any ideas.

The Alabama Political Reporter asked Sen. Beason which of the two plans he preferred.  He said when your choices are between a bad plan and a worse plan you choose option C: none of the above.  Beason said that the state is doing their budgeting all wrong.  They are asking the department heads how much money do you need to keep doing what they are doing and then coming up with an amount or revenue needed to achieve that number.

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Sen. Beason said that the state should instead come up with the expected revenue available and then prepare a budget in order of priorities.  Beason said that some in Montgomery are using the Obama playbook and are identifying the programs that people actually like and are threatening those programs in order to try to get people in line behind the tax increases.

State Representative Will Ainsworth (R-Guntersville) said in a statement on Facebook, “Appropriations for Fiscal Year 2015 were over 28 Billion in Alabama. I will not support Taxes or Gambling until we fix what’s wrong in Government. The narrative in Montgomery that we need more revenue is wrong and I plan on fighting any revenue increase. Revenue proposals are the easy way out.”  Ainsworth said that the state should follow the example of Wisconsin Governor Scott Walker (R) who, “Turned a $3.6 billion deficit in Wisconsin to a surplus without raising taxes.”

The Alabama Policy Institute’s Katherine G. Robinson and Caleb Crosby wrote recently, “The General Fund woes present a very real challenge for our leaders, but the public is being fed a number of false choices as to how this problem must be solved. We should not be forced to choose which revenue generator is the least offensive. There are still plenty of good ideas and even bills on the table that would help the state do what the private sector does–scale back spending in a down year. The appeal of easy money through gambling is that those tough decisions can be sidestepped, but not without repercussions.”

Alabama’s Republican National Committeewoman Vicki Ann Drummond said recently, “I am not for gambling and I am not for taxes and if I were down there (Montgomery) I would vote against both.  I do believe there are a lot of places where we can cut back.”

Former Chairman Armistead wrote recently, “Government sponsored gambling is dishonest, financially damaging to citizens and is a major contributor to the unfairness and inequality in American life. It’s a policy experiment that has failed.  It has failed because it is proven itself to be blatantly dishonest and it has failed to generate genuine economic growth.  Predatory gambling is a something-for-nothing scheme that veils the most cut-throat business in the country.”

A recent Alabama Political Reporter polls shows that Alabama voters oppose tax increases 52.6 percent to 33.7 percent disapprove.  Only 12.0 percent strongly approve of raising taxes, while 40.7 percent strongly disapprove of raising taxes.  Republican primary voters are even less supporting of tax increases.

Las Vegas-style gambling is however supported by 55.5 percent while only 31.0 percent disapprove of Las Vegas-style gambling.

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

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