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Economy

Americans for Tax Reform opposes the Protect Alabama Small Business Act

Brandon Moseley

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Americans for Tax Reform is opposing the Protect Alabama Small Business Act.

Senate Bill 129 would regulate the relationships between franchisors and their Alabama franchisees.

ATR sent a letter to members of the Alabama House of Representatives urging legislators to oppose Senate Bill 129 and its House companion bill HB352. ATR argues in the letter that SB 129 would increase regulation and economic costs in the state.

The Alabama Senate passed Senate Bill 129 (as substituted) on May 9.

In their letter, ATR wrote:

“On behalf of Americans for Tax Reform and our supporters across Alabama, I urge you to vote NO on HB 352 and SB 129 (as substituted). If you talk to business owners today, many will tell you that the onerous and costly regulations are just as much, if not more of a problem than burdensome taxes. Yet HB 352 and SB 129 would make that problem worse by raising the regulatory cost of doing business in Alabama. Furthermore, this bill is a non-solution in search of a problem.”

SB129 is sponsored by State Sen. Chris Elliott, R-Fairhope. HB352 is sponsored by State Rep. Connie Rowe, R-Jasper.

In addition to ATR, more than 80 franchise brands, including McDonalds, Hilton, and the UPS Store, also signed a letter opposing the pending legislation. They claim that franchises would be less likely to site new locations within the state of Alabama and could cost the state around $1 billion in lost economic output going forward.

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SB129/HB352 would regulate private franchise contracts by codifying them into Alabama state law. In case of disagreement between the franchisor and franchisee, the case would have to be litigated in the Alabama Court system rather than in the state of the franchisor.

The business community is wildly divided on this issue with the Alabama Franchisee Association supporting the legislation and opponents, led by the influential n Franchise Association opposing the bills. Opponents have created a website to fight the legislation.

Supporters argue that the legislation is needed to protect franchisees from unfair franchise agreements being forced on them and to prevent unjust termination of the franchise agreement.

To read the full letter in full, click here.

The House could consider SB129 or HB352 as early as Tuesday. If the House were to pass SB129 without amending it, it would go the governor’s desk. HB352, however, would still have to go to the Senate for their consideration.

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Economy

Alabama nonprofit hopes federal food aid for children continues through summer

Eddie Burkhalter

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Almost half of Alabamians experienced a loss in income since the COVID-19 crisis began, and more than 13 percent said they hadn’t had enough to eat during the prior week, according to a recent survey, but there is help for families with children struggling with food insecurity. 

Two federal programs combined can help keep Alabamians fed during coronavirus’s continued impact on health and finances, but there’s work to be done to ensure those programs are fully used, and will continue to help during this time of need, according to Alabama Arise, a nonprofit coalition of advocates focused on poverty. 

Celida Soto Garcia, Alabama Arise’s hunger advocacy coordinator, on Friday discussed the U.S. Department of Agriculture’s  Community Eligibility Provision (CEP), which allows schools with high poverty rates to serve breakfast and lunch to all students, regardless of a parent’s income. 

There are still a little more than 100 school systems in Alabama that would qualify under the program, but haven’t yet applied to do so, Garcia said. 

“Schools that had implemented CEP prior to the pandemic made it a lot easier to distribute food. They didn’t have to worry about eligibility and delayed distribution,” Garcia said. 

Garcia said the coronavirus crisis has brought attention to the CEP program and that some school board officials and child nutrition professionals are beginning to identify which school systems could qualify for the aid. 

“So that of course was a benefit prior to the pandemic, and now there’s just an increased need for it,” Garcia said. 

Carol Gundlach, a policy analyst at Alabama Arise, discussed with APR on Friday the pandemic Electronic Benefit program (P-EBT), which gives parents of children who receive free and reduced lunches a debit card loaded with value of each child’s school meals from March 18 to May 31. The cards can be used at any grocery store. 

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Immigrant families with children enrolled in school can also receive the P-EBT cards, Gundlach said. 

“We of course hope that Congress will see their way to continuing pandemic EBT for the remainder of this summer, because of course, children still have to eat, whether school is in or not, and families are still going to have to pay for those extra meals,” Gunlach said. 

Just more than 13 percent of Alabamians polled said they didn’t have enough to eat during the week prior, according to a survey by the U.S. Census Bureau, and 43 percent said they’d experienced a loss of income due to the COVID-19 crisis. 

“So clearly parents are going to have a very difficult time continuing to feed the whole family through the summer,” Gundlach said. “It’s really a serious crisis and continuing Pandemic EBT would make a really big difference.” 

Many individual school systems across the state are working hard to supply sack lunches to students in need, but without federal aid it will be hard to keep those meals coming all summer, Gundlach said. 

There was an expansion of P-EBT for the remainder of the summer, and a 15 percent increase in regular Supplemental Nutrition Assistance Program benefits, known as food stamps, in the $3 trillion Heroes ACT, which Democrats in the U.S. House passed last week. Gundlach said she hopes the U.S. senators from Alabama get behind the Heroes Act. 

Senate Majority Leader Mitch McConnell, R-Kentuky, said last week, however, that if the Senate takes up another round of coronavirus relief legislation it won’t look like the House version, according to NBC News. 

Gundlach also wanted those without children to know that there’s additional food assistance available to them. 

The Family’s First Act temporarily suspended SNAP’s three-month time limit on benefits, and Gundlach said that even if a person was denied assistance before because they hit that time limit, they can reapply and receive that aid.

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Congress

Sen. Doug Jones: COVID-19 relief should not be a partisan issue

Chip Brownlee

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Sen. Doug Jones, D-Alabama, said Friday during a live-streamed press conference that the Senate should begin debating the next COVID-19 relief package, and Republicans in Congress should stop playing partisan politics with urgently needed COVID-19 relief.

“That bill is not perfect at all. There are a number of things in there that I don’t think will be in a final bill,” Jones said of the House’s $3 trillion HEROES Act. “It’s not perfect, but it is something to start talking about. It is a shame that Senate Republicans have made this into a partisan issue, trying to say that this was some kind of Democratic ‘wish list.’ It is not.”

The $3 trillion relief package includes nearly $1 trillion in aid to struggling state and local governments and another round of $1,200 payments to individual taxpayers and up to $6,000 per family.

The bill, which passed the House last week along partisan lines, appropriates billions for COVID-19 testing and contact-tracing and provides money for hazard pay for essential workers, among many other provisions its 1,800 pages.

“It is a wish list for cities and counties, which we’ve been talking about,” Jones said. “The first line essential workers that have been there that we don’t need to lose — so much of our workforces in city and county governments. It’s a wish list for the CDC and the NIH to continue funding for research, not just for a vaccine, but for therapeutics for how to treat this virus until we get that vaccine. It’s a wish list for businesses.”

The Paycheck Protection Program, which provides loans and grants to small businesses and nonprofit organizations, would also get additional funding in the new relief bill.

Jones has called for a plan to give small businesses another round of help in paying employees by using payroll processors instead of banks, which have, at times, been slow in delivering aid to businesses and have prioritized clients with whom the banks had a pre-existing relationship.

Jones urged lawmakers to consider using payroll companies rather than banks when the first installment of the Payroll Protection Program was taking shape.

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The House’s HEROES Act also includes provisions that clarify PPP provisions for small businesses and would ensure that PPP funding can reach underserved communities and nonprofits. It adds $10 billion for emergency grants through the Economic Injury Disaster Loan Program.

“It has a form of the program that we have — not as scaled up as much as I would lie, but it’s got a program that will help keep businesses operating and their payroll operating as a supplement, an add on to the Payroll Protection Program,” Jones said. “So it’s a wish list, really, for the American people. It’s just a shame that it has been politicized as partisan, because it should not. None of this should be partisan.”

President Donald Trump has threatened to veto the House-passed legislation were the Senate to pass it, and House and Senate Republicans have decried the legislation as too expansive.

Republican members of Alabama’s congressional delegation have called it Speaker Nancy Pelosi’s “wish list” and U.S. Rep. Mo Brooks called it “socialist.”

The 1,800-page bill also includes $175 billion in housing support, student loan forgiveness and a new employee retention tax credit.

Republicans have particularly opposed provisions in the bill that would require all voters to be able to vote by mail beginning in November and another that would temporarily repeal a provision of the 2017 Republican tax law that limited federal deductions for state and local taxes.

Trump has also opposed a provision in the bill that would provide $25 billion for the U.S. Postal Service, which has struggled amid the COVID-19 crisis and could become insolvent without support.

The HEROES Act was declared by some as “dead on arrival” in the Republican-controlled Senate. Senate Majority Leader Mitch McConnell, R-Kentucky, has so far refused to take up the bill. Senators returned back to their home states this week until early June.

“The goal when we get back is maybe … enough talks will be going on, that we can pass some legislation in a bipartisan way,” Jones said. “Because there is an urgency.”

Jones said he didn’t believe the bill would pass as it is currently written, and that he doesn’t know what the final version would look like, but “we need to be talking about it. It’s a starting point,” he said.

The legislation also provides $75 billion for COVID-19 testing and contact tracing, which public health experts say are essential for reopening the economy safely and avoiding a second wave of the virus in the fall.

On Thursday, Gov. Kay Ivey loosened more of the state’s “safer-at-home” restrictions, allowing entertainment venues to reopen Friday and sports to resume by mid-June.

Jones urged Alabamians to continue adhering to social-distancing guidelines, to listen to public health officials and to wear masks. He said reopening the economy and preserving public health don’t have to be at odds.

“I think the governor has done as great a job as she could to try to be very strategic, to be thoughtful on how to do this,” Jones said. “Unfortunately, I also believe that a lot of people in Alabama are only hearing part of her message. They’re only hearing the message that you can go to church, you can go to the theater, you can go out to eat, and they’re not listening as much to the messages about personal responsibility.”

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Economy

Jefferson County extends closure of night clubs, theaters and other entertainment venues

Chip Brownlee

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The Jefferson County Department of Health has extended closures of “high-risk” entertainment venues in the state’s most populous county as those types of businesses can begin opening in the rest of the state.

“Even though things have been opening up, it does not mean that things are better in our community in terms of the spread of COVID-19,” Jefferson County Health Officer Dr. Mark Wilson said Friday. “In fact, I would say it may be more dangerous now to let down your guard than it has been ever since this pandemic began.”

The extended closures in Jefferson County’s updated health order apply to night clubs, concert venues, theaters, performing arts centers, tourist attractions like museums and planetariums, racetracks, adult entertainment venues, casinos and bingo halls, among others.

“Other than those entertainment venues, this order is the same as the statewide order that was issued yesterday,” Wilson said.

Jefferson County’s order remains in place until June 6.

Gov. Kay Ivey’s amended safer-at-home order, issued Thursday, allows those businesses to reopen with social-distancing restrictions and sanitation requirements statewide.

“The reason we are doing this is that we are continuing to see increases in cases of COVID-19 per day in Jefferson County,” Wilson said. “They have been trending up since that last order was issued statewide on May 8.”

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Wilson said current COVID-19 hospitalizations have also increased from 103 to 130 since the state’s more restrictive stay-at-home and safer-at-home orders were lifted earlier this month.

“We want to stay ahead of it and not get to the point where they are overrun,” Wilson said.

In Montgomery County, hospitals are facing a dire shortage of intensive-care beds as cases there have more than doubled since the beginning of the month.

Jefferson County and Mobile County, which have their own autonomous health departments, have the authority to issue more stringent public health orders.

Wilson said he received approval from State Health Officer Dr. Scott Harris to issue the new order. The governor said Thursday that she would support Mobile and Jefferson County should the issue more stringent orders.

The Jefferson County health officer continued to encourage residents to wear face masks or another face covering while out in public.

“We all need to protect each other,” Wilson said.

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Economy

Alabama’s unemployment rate jumps to 12.9 percent

Chip Brownlee

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Alabama’s unemployment rate has surged almost 10 percentage points over the past two months to nearly 13 percent, the Alabama Department of Labor said Friday, another sign of the economic toll caused by the COVID-19 pandemic.

Labor Secretary Fitzgerald Washington said Alabama’s preliminary, seasonally adjusted April unemployment rate is 12.9 percent, which is up from March’s revised level of 3.0 percent. It’s also higher than April 2019’s rate of 3.2 percent.

Last month’s rate represents 283,787 unemployed persons, an increase of 216,783 over the month.

“While we are certainly disappointed to see our unemployment rate rise so sharply this month, it’s not surprising,” said Gov. Kay Ivey. “This global pandemic and national disaster has certainly impacted Alabamians’ ability to work. We know that hundreds of thousands of people have filed for unemployment benefits over the past two months, and we’ve been able to process and pay a great majority of those.  We realize there are some still waiting on relief, and we hear and understand their frustration.  Please rest assured that my administration is working tirelessly to provide relief to those Alabamians and their families, and I have the utmost confidence in the Alabama Department of Labor and the dedicated state employees there who are working tirelessly to serve their fellow citizens.”

Those counted as employed decreased to 1,911,512 in April, down from March’s count of 2,151,586.

“I think everyone will agree that these numbers aren’t numbers we ever wanted to report,” said Washington. “This pandemic has negatively impacted Alabama’s economy and in two months’ time has managed to undo years of positive progress.  But the impact to our employers and workers who carry the economy is even greater.  So many had life-altering changes that impacted their families almost overnight.  I want all Alabamians to know that we are working nonstop to help move this recovery along.  We are developing new technologies, adding staff, and making modifications wherever possible to help our workers through this enormously difficult time.”

Wage and salary employment decreased in April by 201,700.

Monthly losses were seen in the leisure and hospitality sector (-79,500), the professional and business services sector (-29,500), the education and health services sector (-26,400) and the manufacturing sector (-24,200) — among others.

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Over the year, wage and salary employment decreased by 199,200, with losses in the leisure and hospitality sector (-87,900), the professional and business services sector (-30,800), the education and health services sector (-25,300), and the manufacturing sector (-19,100), among others.

Average weekly wages increased to $908.52 in April, up from $883.17 in March.

Counties with the lowest unemployment rates are Geneva County at 8.1 percent, Bullock and Pike Counties at 9.1 percent, and Shelby and Henry Counties at 9.2 percent.

Counties with the highest unemployment rates are Lowndes County at 26.0 percent, Wilcox County at 22.8 percent and Greene County at 22.2 percent.

Major cities with the lowest unemployment rates are Homewood at 7.1 percent, Vestavia Hills at 7.2 percent and Madison at 8.3 percent.

Major cities with the highest unemployment rates are Selma at 23.4 percent, Anniston at 22.1 percent and Gadsden at 22.0 percent.

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