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Legislature

Zeigler releases plan to better fund roads without a fuel tax increase

Brandon Moseley

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Monday, Alabama State Auditor and U.S. Senate candidate Jim Zeigler released a plan to fund Alabama’s road and infrastructure needs without raising fuel taxes on Alabama motorists.

Zeigler calls his proposal “Plan Z,” which he said stands for “zero tax increases and zero congestion on our roads.”

“Plan Z can provide about $900 million in new road construction funds from present revenues.”

Zeigler released copies of Plan Z to the media on Monday.

The state Legislature convenes March 5 for the 2019 regular session. The Legislature is expected to introduce controversial legislation increasing the gasoline and diesel fuel taxes to finance a bevy of new roads and infrastructure spending projects. The specific bill or proposal, however, still has not been released to the public for public comment.

Zeigler is calling for the Legislature to stop diverting $63.5 million a year from the current highway fund to the courts and to state troopers. The Legislature has diverted almost $600 million from roads and bridges over the last 10 years. Zeigler would then use the $63.5 million a year to pay for a 20-year $900 million bond issue for infrastructure.

Zeigler’s plan would direct that the entire bond issue proceeds to actual road work and would also conduct a full management audit of the Alabama Department of Transportation.

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Now, that creates a problem in how the Legislature would make up the for $63.5 million hole in the state general fund.

Zeigler, an attorney, suggests that this diversion may be a violation of Amendments 93, 354, et. al. of the Constitution of Alabama:

Amendment 93. Expenditure of Fees or Taxes Relating to Use, etc., of Vehicles and to Fuels Used for Vehicles.

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“No moneys derived from any fees, excises, or license taxes, levied by the state, relating to registration, operation, or use of vehicles upon the public highways except a vehicle-use tax imposed in lieu of a sales tax, and no moneys derived from any fee, excises, or license taxes, levied by the state, relating to fuels used for propelling such vehicles except pump taxes, shall be expended for other than cost of administering such laws, statutory refunds and adjustments allowed therein, cost of construction, reconstruction, maintenance and repair of public highways and bridges, costs of highway rights-of-way, payment of highway obligations, the cost of traffic regulation, and the expense of enforcing state traffic and motor vehicle laws.”

The Legislature argues that the diversion is covered under that last part: “…the cost of traffic regulation, and the expense of enforcing state traffic and motor vehicle laws.”

Zeigler said the $900 million 20-year bond issue for infrastructure could be used standing alone or as matching state share of federal funds, providing leverage. Zeigler said that ALDOT is a large agency.

“If the public is to be asked to pay a higher tax rate for gasoline or is to be liable for a 20-year bond issue, the public expects to be confident that the funds are being wisely and prudently spent by ALDOT,” he said.

Zeigler said the $63.5 million being diverted can be made up from revenue growth.

“The state’s economy is growing and is expected to continue growing,” Zeigler said. “As a result, state revenues have grown and are expected to continue to grow. These additional revenues can partially offset the $63.5 million loss by blocking the diversion.”

Zeigler also proposed a new tax on unclaimed gift and cash cards and “breakage” of cards.

Tens of millions of dollars each year are going to issuers of gift cards and similar cash purchase cards from unused cards. When the cardholder does not redeem the card, the issuer receives an unearned windfall. The largest of the issuers are out-of-state corporations such as Wal-Mart and Target. Also, when the cardholder uses the card, it is almost always for a different and slightly lower amount than the full value. For instance, the holder can pay for an $18.23 purchase with a $20 gift card. The remaining amount is often never used. This is called “breakage.” Issuers make millions each year by simply profiting by a windfall from the breakage.

“The Legislature can pass a bill making the balance on unused cash cards and breakage go to the state general fund,” Zeigler said. “This costs consumers nothing as they have already allowed the amounts to go unused. A consumer who does not want his card balance to go to the state can remedy this by fully using his card. The unused amounts could “escheat” to the state general fund after the expiration date of the card, when the customer would have lost out anyway. If there is no expiration date, the amount escheats to the state general fund after an established time, example, two years from issuance.”

Zeigler said that this would work like existing state law for unclaimed property, including forgotten bank accounts.

Zeigler suggested that this additional revenue could make up for a substantial amount of the $63.5 million lost to the general fund by stopping the diversion of highway funds.

He also suggested that if administrative costs of most state agencies were cut an average of about 1.5 percent — not across the board, but on average — it would generate the remainder of the $63.5 million. Certain agencies would be protected from this cut, such as Medicaid and others that receive substantial federal matching dollars.

Zeigler said the State Auditor’s office was slashed under the final two administration budgets under former Gov. Robert Bentley, and the State Auditor was cut 28.5 percent from an already lean budget. Yet, by squeezing every dollar, the office stayed current on all audits. Zeigler said that a mere 1.5 percent cut would have been easy for the State Auditor’s office.

Zeigler is in his second term as state Auditor and has announced that he is exploring running for the U.S. Senate seat currently held by Doug Jones.

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.

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Corruption

Former State Sen. David Burkette pleads guilty, avoids jail

Josh Moon

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Former Alabama Sen. David Burkette

Former State Sen. David Burkette will avoid jail time and be sentenced to a 30-day suspended sentence as part of a plea deal reached on Monday. 

Burkette, who pleaded guilty to one count of violating the Fair Campaign Practices Act, will also have to pay a $3,000 fine and serve 12 months of probation as part of the deal. He was sentenced in Montgomery Circuit Court on Monday after being charged two weeks ago with failing to deposit more than $3,600 in contributions into campaign accounts — a misdemeanor.

He also resigned his seat in the Alabama Senate as part of the plea deal. 

“I’m just happy to still be here,” Burkette told the court following his sentencing, according to multiple media reports. 

The former senator suffered a stroke in 2018 and has been confined to a wheelchair since. His current health status played a role in his sentence considerations. 

The charges against Burkette stem from a series of complaints filed against him with the Alabama Ethics Commission — all of them related to various issues during his time on the Montgomery City Council. The charge for which he pleaded guilty occurred in 2015.

The Ethics Commission referred numerous charges to the Alabama attorney general’s office, according to sources familiar with the investigation of Burkette, but the attorney general’s office elected to charge Burkette with only the misdemeanor as part of the deal that saw him resign. 

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“Candidates for public office at the state, county and municipal levels must comply with the State’s Fair Campaign Practices Act,” said Attorney General Steve Marshall. “Personally profiting from campaign funds erodes public confidence in the system and will not be tolerated.”

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Legislature

Former state senator arrested on charges of violating campaign finance laws

Josh Moon

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Former State Sen. David Burkette

David Burkette has been officially arrested. The former state senator from Montgomery, who resigned on Tuesday as part of a plea deal with the Alabama Attorney General’s Office, was formally charged on Thursday with a single misdemeanor count of violating the Fair Campaign Practices Act. 

According to a press release from the AG’s office, Burkette’s charge stems from him depositing campaign donations into his personal account instead of into his campaign accounts, as required by the FCPA. The alleged crimes occurred in 2015 and 2016 when Burkette was serving on the Montgomery City Council. 

The complaint alleged that, in 2015 and 2016 while running for the Montgomery City Council, Burkette intentionally failed to deposit $3,625.00 in campaign contributions into his campaign checking account, and instead, deposited or cashed those contributions into or against his personal bank account,” the AG’s release stated. 

The single misdemeanor charge is surprising given the lengthy list of allegations against Burkette submitted to the Alabama Ethics Commission. APR obtained a copy of the original report, which was submitted in October 2018. 

In addition to more than $40,000 in allegedly improperly spent council discretionary funds that were flagged by auditors for the city of Montgomery, Burkette was also accused of inappropriately donating tens of thousands more to suspect charities and two sororities, including his wife’s.

The Ethics Commission referred Burkette’s case to the AG’s Office in October 2019.

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Legislature

Pro-Growth Conference kicks off with Doug Jones, discussions on COVID impact and a living wage

Josh Moon

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Sen. Doug Jones speaks on the floor of the U.S. Senate. (VIA CSPAN)

What happens if you just give impoverished citizens $500 per month — no strings attached? Good things, it turns out. The people use that income to buy food, medicine and basic necessities for life. They take a day off work if they’re sick and actually get treatment. They quit a second, hourly-wage job that they are overqualified for and instead work towards obtaining a better, higher-paying primary job. 

These are things that the city of Stockton, California, has learned in its year-long living wage program.

The program, while limited in size — only 125 people — has proven to be a larger success than city officials had hoped, and it has opened their eyes to a new, more proactive style of governance, Stockton Mayor Michael Tubbs told Alabama elected officials. 

Tubbs was the featured speaker on Tuesday at the first day of the Pro-Growth Policy Conference, a three-day forum for Alabama elected leaders with guest speakers from around the country offering tips and best practices. 

The first day of the conference began with an opening talk from Sen. Doug Jones, who pressed the need for Medicaid expansion and how expansion has aided other red states. Jones also highlighted the need for broadband expansion and talked about a bill he has in the Senate that would create a broadband main office and dish out about $20 million in money for affordable access.

“Now (with COVID), we know how needed it really is,” Jones said. “We see the homework gap that we have. We know there’s a need for more telemedicine. My bill would consolidate in one office all of the monies for broadband … and provide affordable access.”

Jones said the current COVID pandemic has highlighted just how badly we need better access to broadband in Alabama, and a major area of concern right now is healthcare. 

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Highlighting that point, Brandon Garrett, the chief operating officer of the National Minority Quality Forum, and Dr. LaTasha Lee, the vice-president of social and clinical research, demonstrated the many ways in which inequality in health care and health care options is harming impoverished communities. 

A number of factors play into that inequality, but a lack of access to updated means of communication and tools is one of the biggest. 

“(Dr. Martin Luther King Jr.) said that, ‘Of all the forms of inequality, injustice in health care is the most shocking and inhumane because it results in physical death,’” Lee said. “That’s what we’re seeing currently with COVID-19 and sickle cell disease. These two diseases are affecting the minority community and causing death, and they make a great argument that such health care disparities really are a social justice issue.”

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Correcting such issues was one of the goals of Stockton’s living wage experiment. Now, Tubbs said, a working person can afford to stay home or get tested if they’re feeling symptomatic, whereas before that person — scared of missing a paycheck or losing the job altogether — might come to work with the virus and infect an entire workplace. 

That alone, Tubbs said, has restored dignity to a number of residents. 

“This is not easy, especially with budgets the way they are,” Tubbs said. “But I don’t know how we continue to live with the status quo as it is.

“I think part of being a leader, as we are, is having the courage to do something about what we’re seeing. We have to be able to do that.”

The Pro-Growth Policy Conference will run both Wednesday and Thursday, 10 a.m. until 2 p.m. Wednesday’s round of conferences will focus on state grants, economic development around the state and what the 2021 legislative session might look like. 

On Thursday, the event will wrap up with talks by the Equal Justice Initiative’s Bryan Stevenson and Alabama Congresswoman Terri Sewell.

 

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Elections

Russell Bedsole wins Republican runoff in HD49

Brandon Moseley

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House District 49 Republican nominee Russell Bedsole

As of press time, it appears that Russell Bedsole has won a narrow victory over Mimi Penhale in the special Republican primary runoff election in Alabama House District 49.

At press time, Bedsole had a 166-vote lead in unofficial results on the secretary of state’s website.

“We won,” Bedsole declared on social media.

Bedsole is an Alabaster city councilman and a Shelby County Sheriff’s Department captain.

“Sadly, tonight did not turn out in my favor. Despite the loss, I feel like God truly used this opportunity to help me grow in my walk with Him, and gave me the opportunity to increase my testimony,” Penhale said. “I feel so incredibly blessed by the people I have met on this campaign and the experiences I have had. I am disappointed in the outcome, but what an honor it is to have the confidence of 1,183 people across House District 49! Thank you!!”

Russell Bedsole had 1,249 votes, or 51.36 percent, to Mimi Penhale’s 1,183, or 48.64 percent, to win the House District 49 Republican primary runoff.

There were just 2,432 votes cast in the special primary runoff election. Shelby County was the decisive factor in the election. Bedsole won Shelby County with 762 votes, or 71.42 percent, to Penale’s 305 votes.

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Penhale carried Chilton and Bibb Counties, but could not overcome Bedsole’s strong performance in Shelby County.

The provisional ballots will be counted on Sept. 8, 2020, and certification of votes will occur on Sept. 16, 2020.

Bedsole will face Democratic nominee Sheryl Patton in the special general election on Tuesday, Nov. 17, 2020.

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The vacancy in House District 49 was created when State Rep. April Weaver announced her resignation to accept a presidential appointment as a regional director in the Department of Health and Human Services.

In a statement, the Alabama Republican Party thanked “each of the candidates that qualified for offering themselves up for service in the Alabama State House of Representatives.”

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