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Committee considers legislation to regulate franchise agreements

Brandon Moseley

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Wednesday, the Alabama House Commerce and Small Business Committee held a public hearing on a bill that would regulate the franchisor and franchisee agreements between large corporations and their Alabama franchisees.

House bill 352, titled the Protect Alabama Small Business Act, is sponsored by state Rep. Connie Rowe, R-Jasper.

The Senate companion bill is being sponsored by Senator Chris Elliott, R-Fairhope.

State Representative Jim Carns, R-Vestavia, is the Chairman of the House Commerce and Small Business Committee.

Rep. Rowe said that the bill would regular franchisors

“The goal of this legislation is to promote small Alabama owned businesses,” Rowe said. Under existing franchise agreements if there is any litigation the agreements call for the cases to be heard in the state where the franchisor is located. This bill would bring in to the state of Alabama rather than where the franchisor operates or is headquartered.

Rowe said that under this bill franchisors “must act in good faith and a commercially responsible manner.”
There were business leaders on both sides of the debate in the public hearing.

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Daniel Morgan is the owner of two franchises, and he opposes the bill,

“We employ 275 people in the Birmingham area,” Morgan said. The customers of his temporary service are 375 small businesses in the Birmingham area.

“As a franchisee I am very concerned about this bill,” Morgan said, This is “A one size fits all bill that makes it hard for brand standards to be enforced.”

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“When the national trend is less regulation why does Alabama want more regulation?” Morgan said. “I urge you to consider the impact this would have on the locally owned small businesses that play by the roles.

Sen. Elliott said, “This has passed out of the Senate government affairs committee.”

“I am a former franchisee,” Elliott said. The business people here speaking against the bill, “They probably have not had an experience with a franchisor like I have.”

Elliott claimed that this bill would protect franchisee from unjust actions by franchisors. “I was lucky to be able to sell my business. My franchisor could have prevented me from selling my business.”

Elliott said that the franchise, “Ended up becoming a terrible relationship for the both of us.”

“This bill requires that if there is a dispute it be settled in Alabama,” Sen. Elliott said. “Most small businesses can not afford to litigate in Memphis, California or New York.”

Tina McCutcheon is a Home Helpers franchisee and the owner of Jacksonville Senior Health Services.

“I read the agreement and knew the terms of the agreement between Home Helpers and me before I signed it,” McCutcheon said. “I do not see the benefit of the state of Alabama becoming involved in the franchise agreement.”
McCutcheon warned that the bill, “Makes it harder to enforce those brand standards.”

McCutcheon said that when a rogue owner of a franchise chooses not to live up to the brand standards “It hurts all of us.”

McCutcheon said that it is important, “For my franchisor to protect my brand by making my neighboring owners apply standards to their franchise.”

“It is a one size fits all bill, vote no on HB352,” McCutcheon said.

The owner of a Service Master franchise in Mobile said that he had a great relationship with my franchisor until they hired a new CEO. They put a new franchise on top of me. Service Master franchises are a non-exclusive territory and if there is a disagreement over the contract it is settled by “binding arbitration in the state of Tennessee. They can break me in legal fees. My contract is vastly different than what I signed 24 years ago and it renews every two years and includes a non-compete clause. They can do anything they want to us and there is no way that we can fight back.”

Robert Brown is the director of operations for Huddle House.

“When we look at the franchise agreement, it is in place to protect the brand and the community as well,” Brown said. “For Huddle House, we use the franchise agreement to hold the franchisee accountable so they conduct themselves just like our corporate restaurants.”

Brown said that when a Huddle House runs into trouble, we send a team of operators that go out and turn it around,
Brown warned that if Alabama were to pass HB352 it will hurt our ability to expand and we would be less likely to site new locations in Alabama.

Bill King represents a company with over 200 Burger Kings and Popeyes locations

King said that franchisors, “Will often threaten to terminate or non-renew unless we do expensive remodels to our stores and the franchise agreements renew every two years.”

“Even at our size, we struggle to negotiate with the franchisor,” King said. The franchise agreement is take it or leave it.

“I do believe that we would be likely to do more brands in Alabama if this were to pass,” King said.
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Tom Dekle is the CEO of Milos Hamburgers and one of the owners.

“As a small business, we don’t think we need any more regulation,” Dekle said. “We have 20 restaurants today and 15 more pins on the map…..all in Alabama.”

“We have faith in the current contract law,” Dekle said. “Fifteen more stores would generate $20 million in revenue, but we won’t go forward under this proposal….in the state of Alabama.”

Dekle said that HB352 “Is prohibitive” and “Puts handcuffs on us.”

Heather Wilson is the Executive Director of the Alabama Franchisee Association and she supports the legislation
Heather read a letter from Darryl Bush who was a Huddle House franchisee for over two decades. Bush claimed that they were prematurely forced out of business by Huddle House Inc. Now that they have broken away from Huddle House, the company has acquired property just a half mile from our location and are planning on building a company store there.

Dom Gentile has two Jan Pro Cleaning franchises in Alabama and is a former GOP U.S. Senate candidate.
Gentile said that this was liberal legislation that had been introduced in the California legislature but was too far out even for them. Gentile said that he could not believe that a Republican legislature in a deep red state like Alabama was even considering this.

The House Commerce and Small Business Committee is expected to make their decision on HB352 on Wednesday.

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House

McCutcheon not optimistic about passage of “constitutional carry” legislation

Brandon Moseley

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Alabama House Mac McCutcheon, R-Monrovia, discussed gun legislation that could appear before the House of Representatives this year.

In past sessions, constitutional carry legislation has made it out of the Alabama Senate, but stalls in the House. This year, Rep. Andrew Sorrell, R-Muscle Shoals, is carrying the bill in the House. APR asked McCutcheon whether he anticipates it passing this time.

“The mood would tend to be the same that it was in the past,” McCutcheon said. “There is a bill out there now for a lifetime carry permit and a procedural check for a permit.”

McCutcheon said that under that bill a state database would be used for granting concealed carry permits instead of a local database. Each sheriff of each county would be doing things the same way by ALEA (the Alabama Law Enforcement Agency) being involved in this.

McCutcheon said that the House is “taking a very serious look at that bill.”

State Sen. Randy Price, R-Opelika, and State Representative Proncey Robertson, R-Mt. Hope, pre-filed the lifetime permit bill that would establish a cohesive and statewide management level process for administering and managing concealed weapons permits in the state of Alabama. The National Rifle Association has endorsed this legislation.

Robertson’s House version is HB39. It has been assigned to the House Public Safety and Homeland Security Committee where it is awaiting action. Price’s Senate version is SB47. It has been assigned to the Senate Judiciary Committee where it is also awaiting action in committee.

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Currently, the application process and managing of applicants is different county by county. Some rural county sheriffs have issued concealed carry permits, sometimes called pistol permits, without doing background checks. This resulted last year in federal authorities revoking Alabama concealed carry permit holders from being able to buy firearms without having to go through the background check system.

The sponsors promise that this legislation would create a streamlined process of standards for Sheriff Departments to implement and will be monitored by the Alabama Law Enforcement Agency (ALEA). This bill creates a cohesive standard for background checks and will bring 21st century technology to Sheriff’s departments and all other law enforcement agencies across the state. Sheriff departments will now have access to electronic information of which all levels of law enforcement will have access to. It will also require municipalities to start reporting those that are convicted of domestic violence as well as Probate Judges to begin reporting individuals that have been involuntarily committed. Applicants will also now have the option to apply for a concealed weapons permit for one year, five years or a lifetime permit.

Sorrell told APR on Saturday that he opposes HB39/SB47 because it creates a statewide database with all of Alabama’s concealed carry holders.

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In the State of Alabama, it is a Class A Misdemeanor to carry concealed weapons without a permit.

Sorrell’s legislation, Constitutional Carry, would eliminate that crime altogether and give every Alabamian the constitutional right to carry a firearm concealed if they so choose.

State Senator Gerald Allen, R-Tuscaloosa, has introduced Constitutional Carry legislation in the State Senate; SB1. That bill has been assigned to the Senate Judiciary Committee where it awaits committee action.

SB1 would allow all Alabama citizens who have not had their gun rights revoked to carry firearms concealed without having to have a concealed carry permit. That legislation could not get out of committee in the Senate last year.

Sorrell told APR that there is momentum in the Alabama House of Representatives for Constitutional Carry and that he hoped to have as many as twenty cosponsors when he introduces his bill.

It is currently legal in Alabama to openly carry firearms without a permit, if your gun rights have not been taken away. A citizen can lose their gun rights due to a felony conviction, being declared mentally unfit by a probate judge, or a misdemeanor domestic violence conviction. While every citizen, who still has gun rights, may openly carry without a concealed carry permit; it is against the law to have a loaded handgun in a vehicle without a concealed carry permit.

Handguns must be unloaded and locked in a box or trunk out of reach. Similarly, if a person is openly carrying a handgun on their side, were to put a jacket on so that the gun was no longer visible that would also be a misdemeanor as they are now carrying concealed, unless they have a valid concealed carry permit allowing them to conceal their handgun. Persons with a concealed carry permit are allowed to have their gun on their person while riding in a motor vehicle or within reach like in the glove box, loaded or not. This does not apply to long guns (rifles and shotguns). All Alabama citizens, who still have their gun rights, may carry their shotgun or rifle with them in their vehicle, without having to obtain a concealed carry permit to exercise that right.

To get your concealed carry permit you must go to the sheriff’s department in your home county. The fee varies from county to county.

Twenty percent of adult Alabamians have a concealed carry permit, the highest rate in the country. The Alabama Sheriff’s Association have steadfastly opposed Constitutional Carry legislation. According to the National Association for Gun Rights, fifteen states, including Mississippi, have Constitutional Carry already.

 

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House

McCutcheon is in “wait and see mode” on medical marijuana bill

Brandon Moseley

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Speaker of the Alabama House of Representatives Mac McCutcheon (R-Monrovia) last Thursday was asked by reporters where he stood on pending medical marijuana legislation.

“I am in a wait and see mode,” McCutcheon told reporters. “The sponsor of the bill has done a lot of work.”

On Tuesday, State Senator Tim Melson (R-Florence) introduced a bill to legalize tightly controlled medical cannabis. The Medical cannabis bill introduced on Tuesday is Senate Bill 165.

“We have a letter from the Attorney General,” recommending that the legislature reject the bill.

Attorney General Steve Marshall (R) is arguing that while marijuana remains a federally controlled substance the legislature should not pass a state law that would be noncompliant with federal law. Marshall believes that if medical marijuana has any medical benefit then the federal Food and Drug Administration (FDA) will be the appropriate authority to approve such legislation and the state should wait for FDA to act.

33 states already have legalized medical marijuana.

“It brings up a legal question when you get a legal opinion from the attorney general office,” McCutcheon explained. “It answers some of my questions and also on the pro and the con there were some questions raised in the legal community.”

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McCutcheon said, “That is why we are in the mode that we are in.”

Melson introduced a medical marijuana bill last year during the 2019 regular session. That bill passed the Senate; but had difficulty getting out of committee in the Alabama House of Representatives. Instead of passing medical marijuana legislation the legislature passed a bill extending Leni’s Law and Carly’s law and establishing the Alabama Medical Cannabis Study Commission tasked with making a recommendation to the legislature.

The Alabama Medical Cannabis Study Commission was chaired by Sen. Melson and met monthly from August to November. In December, the commission voted in favor of a draft proposal recommending that the state allow licensed medical providers to prescribe marijuana based medications to patients with a demonstrated need. The state would create the Alabama Medical Cannabis Commission to regulate medical cannabis in the state. Farmers, processors, transporters, and dispensaries would have to get a license from the Commission and product would be strictly regulated.

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Despite the Commission’s recommendation, SB165 remains highly controversial in the legislature and there is expected to be considerable opposition to the bill. SB165 is 82 pages long.

SB165 has been assigned to the Senate Judiciary Committee. Judiciary Committee Chairman Cam Ward (R-Alabaster) told the Alabama Political Reporter that there will be a public hearing on SB165 on Wednesday, at 8:30 a.m. in the Alabama Statehouse room 825. Opponents and proponents will both be given the opportunity to voice their opinions.

Thursday was the fourth day of the 2020 legislative session.

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House

House passes bill to simplify annexations

Brandon Moseley

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Thursday the Alabama House of Representatives passed legislation making it simpler to annex property in overlapping police jurisdictions if both of the municipalities agree and all of the landowners agree with the annexation.

House Bill 12 is sponsored by State Representative Terri Collins, R-Decatur. The bill however was carried on the floor of the House on Thursday by Rep. Connie Rowe, R-Jasper, who was away with her family due to the sudden death of her husband, Tom Collins, from a sudden heart attack on Sunday, February 9.

Rowe said that under current law, if both of the municipalities in overlapping police jurisdictions agree, and all of the property owners are also in agreement then half of the land could be annexed this year. Half of the remaining half could enter the city limits next year, then half of the remaining one quarter could be annexed the year after that. The process could take years.

HB12 simplifies it so that all of the land in overlapping police jurisdiction, where the landowners are in agreement, could come in to the city limits of their choice as long as both of the cities or town are in agreement.

Rep. Steve Hurst, R-Munford, said that he was voting against the bill and wanted it amended to exempt Talladega County out of it. He said that many country people were fearful of being annexed into a city and having local governments telling them that they can not build a chicken house or expand their barn. Hurst said that there was a Mayor in his county that was seeking more power and more annexations. He did not name that mayor.

Rowe assured Hurst that the property owners could not be annexed against their will under the terms of this legislation.

HB12 was passed by the Alabama House of Representatives on a vote of 83 to 4.

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The legislation now goes to the Alabama Senate for their consideration.

The Alabama House of Representatives will meet again on Tuesday, February 18. It will be the fifth day of the 2020 Legislative Session. Under the Alabama Constitution of 1901, the regular legislative session is limited to no more than thirty days.

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Crime

House passes bill to make it a hate crime to attack law enforcement

Brandon Moseley

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The Alabama House of Representatives passed legislation Thursday that would add law enforcement officers to Alabama’s hate crimes statute. It now moves to the Senate.

The House passed HB59 by a margin of 92 to 0.

Under current law a crime become a hate crime if a person is victimized because of their race, creed, or disability. Murder to make money, in a crime of passion, or in the commission of a crime is murder. If a racist targets a person because of their race, then it become a hate crime and additional sentencing enhancements kick in under Alabama sentencing guidelines. House Bill 59 would make targeting a member of law enforcement because they are a member of law enforcement also a hate crime.

House Bill 59 is sponsored by State Representative Rex Reynolds (R-Huntsville).

Reynolds said that Alabama Attorney General Steve Marshall supports the legislation.

“An attack on law enforcement in Alabama is an attack on all of her citizens—an attack on all Alabamians.…” Marshall said on social media. “If you take the life the life of a law enforcement officer, you will likely have forfeited your life as well.”

Marshall stated, “To the brave men and women who wear that badge, my heroes: Don’t give up. Don’t lose heart. Keep fighting the good fight, because your cause is righteous. Know that you have our support and our eternal gratitude.”

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Reynolds said that attacks on law enforcement, whether it is throwing water on them, assaults, or assassinations are up across the country. “We are not going to stand for it anymore.”

State Representative Mary Moore (D-Birmingham) said, “I support the bill, but there are too many guns on the street.”

Moore proposed banning high powered rifles and AR-15s. “We need to level the playing field for them.” :We stand ready to come up with a bipartisan bill to curb the number of guns on the street. We need men and women who are not afraid of the National Rifle Association.”

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“We have got to change how police officers are treated,” said Rep. Allen Treadaway (R-Morris). “I have been to too many police funerals.”

Treadaway is a police captain with Birmingham Police Department.

“The disrespect for police officers is unprecedented,” Treadaway said. “I have been a law enforcement officer for 30 years and I have not seen anything like it. We can’t hire police. We can’t retain police.”

Rep. Artis “A. J.” McCampbell (D-Livingston) said, “We have had eight police officers killed in the last 13 months.”

“How do we enhance the crimes when we already have a capital case for the murder of a police officer?” McCampbell asked.

Reynolds said that the sentence enhancements would apply when the police were targeted; but it is not a capital crime. 6,500 police officers were assaulted last year.

Reynolds said that harming an officer while attempting to escape or resisting arrest would not qualify as a hate crime. Attacking police because the motive is hate of the police would be a hate crime and then sentencing enhancements would apply.

Reynolds said that under current law if they are convicted of a capital crime of killing the police they get the death penalty.

Rep. John Rogers (D-Birmingham) said, “Is there a way to just give them the death penalty without going through all the appeals?”

Reynolds said, “I sure wish we could.”

Rogers said, “The death penalty should be automatic.”

Rogers daughter Mary Smith mas murdered.

“It has to be adjudicated in the court system before these enhancements would not come into play,” Reynolds said. “I hope there will come a day when a bill like this is not needed because people respect law enforcement.”

Rep. Arnold Mooney (R-Indian Springs) said that the police, sheriffs, and other law enforcement and first responders at the thin blue line protecting us and our families.

Mooney is a Republican candidate for U.S. Senate.

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