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Montgomery’s new occupation tax likely to be challenged by the legislature

Drone Aerial View of Downtown Montgomery Alabama AL Skyline

Tuesday night, the Montgomery City Council voted to impose an occupation tax on everyone who works in the city of Montgomery. Tens of thousands of people would be adversely impacted by the move. The Alabama legislature appears to be on the verge of blocking the controversial measure.

Earlier that day that Senate Government Affairs committee gave a favorable report to House Bill 147, sponsored by State Representative Chris Sells (R-Greenville).

New Montgomery Mayor Steven Reed was at that meeting and told the Senators that the City Council would table their motion to impose an occupation tax on the people who work in the City if the Committee would carry over HB147.

The Committee refused that proposal and gave a favorable report on an eight to two vote.

Sells’ bill, which passed the House on Tuesday, February 11, would require that any city who did not already have an occupational tax on February 1 must have their tax approved by the Alabama State Legislature, similarly to what counties have to do.

The State Government Committee is Chaired by Jimmy Holley (R-Elba).

Holley told Reed, “I remember you when you were a small boy, serving with your father.”

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“Our city have very moderate revenue,” Reed pleaded with Senators. “We are about 18th in revenue per capita.”

“How do we pay our policemen, our firemen our sanitation workers?” the new Mayor asked. “We had no intention of passing an occupational case.”

Reed claimed that the subject had come up in some public meetings on how the state’s capitol city could enhance revenue.

“We are the engine that drives the whole river region,” Reed said. “We are the fourth performing regional area of the state. We are behind Huntsville-Madison, we are behind Birmingham-Hoover and we are behind Mobile.”

Reed said that the city had some hearings and would like time to study the situation.

“It is important to cities that Home rule means something,” Reed said. “26 other cities have an occupational tax.”

“We do have an ordinance on our agenda from tonight,” Mayor Reed threatened. “If it is not pulled from the agenda today we will move forward with that.”

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Rep. Sells said, “I am not trying to remove an option.”

Sells said that thousands of Alabamians work in Montgomery and live in other places. “These people have no voice right now.”

State Senator Linda Coleman-Madison (D-Birmingham) said, “I come from Birmingham where I served on the City Council. This legislature for years has long eroded local authority and control.”

Coleman-Madison said that mayors and city councils are also elected by the people and if the people do not like the way they are doing their jobs they can be removed. It is called voting.

(Mayor) “David Vann in his infinite wisdom fashioned the occupation tax. People from the outside use the roads, if they have an accident local police have to respond.” If they need assistance fire and rescue will assist them. If they come in for events the city has to maintain those venues. “So all of these amenities that people on the outside enjoy, those costs are being born by the people that live in the cities.”

“In Jefferson County a lot of our cities are having problems with roads due to traffic whether that is heavy trucks or people coming in,” Coleman-Madison said. “This legislative body, we should be working with local government not tying their hands.”

Reed is the son of Alabama Democratic Conference Chairman Joe Reed. The senior Reed has been a powerful force in the Alabama Democratic Party for fifty years.

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Sen. Chris Elliot (R-Fairhope) made a motion to give HB147 a favorable report.

The Committee passed the bill on eight to two vote. It now goes to the full Senate for their consideration.

Brandon Moseley
Written By

Brandon Moseley is a senior reporter with over nine years at Alabama Political Reporter. During that time he has written 8,297 articles for APR. 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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