Gov. Kay Ivey on Thursday announced the creation of a first-of-its kind statewide commission on entrepreneurship and innovation, meant to promote innovation across the state and cut red tape for those seeking to start new businesses.
The 15-member Alabama Innovation Commission, to be known as Innovate Alabama, will allow innovators to “engage policymakers, exchange ideas and identify policies that promote innovation in the state,” according to a press release from Ivey’s office Thursday.
Ivey’s executive order also creates a six-member advisory council made up of innovators with Alabama ties.
“Through the establishment of the Alabama Innovation Commission, I look forward to collaborating with our state’s leading innovators to develop a long-term strategy to create a more resilient, inclusive and robust economy,” Ivey said in a statement. “Alabama has always had a rich tradition of developing technologies to move our state forward. Now more than ever, we must capitalize on future opportunities by engaging our state’s trailblazers to discuss new ideas and policies that support entrepreneurship, economic development and jobs.”
Rep. Bill Poole, R-Tuscaloosa, will serve as chair of the commission and Senator Greg Reed, R-Jasper, will serve as vice-chair.
“I’m inspired by the potential for future growth in our state’s innovation community and look forward to continued momentum and growth in this sector. The Alabama Incentives Modernization Act set into motion a new set of incentives that will help grow, attract and retain startups and technology companies in the state,” Poole said in a statement. “Forming the Alabama Innovation Commission is a critical step to further create policies that will ensure Alabama’s competitiveness in the technology and startup sector.”
“Through this commission, we hope to tap into the potential for the state to become a hub for startups and technology-based companies,” Reed said in the release. “I look forward to working with the Alabama Innovation Commission to encourage collaboration, public-private partnerships and smart policies that promote access to opportunity and create a pipeline for success in all corners of the state.”
According to Ivey’s office, the commission will look at policies to increase entrepreneurship, spur innovation and address the challenges and red tape startups often face. Commissioner members are also tasked with crafting and presenting a “comprehensive innovation policy agenda” for Ivey’s office and the state Legislature.
Alabama Power Executive Vice President Zeke Smith will serve as president of the advisory council, and former U.S. Secretary of State and incoming director of Stanford University’s Hoover Institution, Dr. Condoleezza Rice, will also serve on the advisory council.
“Alabama is home to me, and I am honored to serve on the advisory council for the Alabama Innovation Commission,” Dr. Rice said in a statement. “While our country currently faces many challenges, this is an opportunity to create forward-thinking ideas and policies that will inspire the next generation of innovators. By focusing on knowledge-based skills and education, technology growth and entrepreneurship, we unlock the potential for future success across the state.”
“The Alabama Innovation Commission will provide a tremendous opportunity to partner with leaders from the public and private sectors to grow our great state,” said Greg Barker, president of the Economic Development Partnership of Alabama, in a statement. “The focus on innovation to deliver sustainable growth will benefit our entire state through new solutions and more job opportunities. I am excited to play an important role in building Alabama’s future.”
The commission will virtually convene for the first time on August 13.
- Rep. Bill Poole – State Representative (Chair) Representative Bill Poole, R-Tuscaloosa, serves in the Alabama House of Representatives. A native of Marengo County, Poole was first elected to the House of Representatives in 2010 and serves as Chairman of the House Ways and Means Education Budget Committee and the Tuscaloosa County Legislation Committee. Poole was the sponsor of the Alabama Incentives Modernization Act, a critical law focused upon making the state more attractive to tech-based companies and entrepreneurs.
- Sen. Greg Reed – State Senator (Vice Chair) Senator Greg Reed, R-Jasper, was first elected to the Alabama State Senate in 2010 and serves as the Senate Majority Leader. Reed is a native of Jasper and is a member of the Rules, Jefferson County Legislation, Confirmations, Transportation and Energy, Healthcare and Local Legislation committees. Reed served as the senate sponsor of the Alabama Incentives Modernization Act.
- Scott Adams – Executive Vice President and Chief Digital & Innovation Officer, Protective Life Corporation Scott Adams leads Protective’s community engagement and Corporate Social Responsibility activities as well as oversees several corporate functions, including the Protective Life Foundation, brand and social engagement and corporate communications. In addition, he works with executive leadership on the development of strategy and innovation in support of our growth initiatives.
- Sen. Malika Sanders-Fortier – Senator Sanders-Fortier is a Selma, Ala. native and has served in the Alabama State Senate since 2018. She is a member of the Finance and Taxation Education, Judiciary, Governmental Affairs, Fiscal Responsibility and Economic Development, Children Youth and Human Services and Veterans and Military Affairs committees.
- Rep. Jeremy Gray — State Representative Jeremy Gray has served in the Alabama House of Representatives since 2018 representing District 83. A native of Opelika, Ala., Gray serves on the Commerce and Small Business, Health, Lee County, and Public Safety and Homeland Security committees.
- Greg Barker – President, Economic Development Partnership of Alabama. In his role at EDPA, Barker supports business recruitment and expansion efforts in Alabama and promotes innovative and emerging startup companies through its Alabama Launchpad program. A veteran in economic development, he has more than 35 years of experience leading recruitment, expansion and innovation efforts in the Southeast. Prior to joining EDPA, served in various leadership roles at Alabama Power in economic development, most recently serving as executive vice president of customer services. Barker serves on the board of directors for numerous business and economic development organizations, including the Bill L. Harbert Institute for Innovation and Entrepreneurship at the University of Alabama at Birmingham, Opportunity Alabama and Innovation Depot.
- Lindsay Rane Carter – Associate General Counsel, Great Southern Wood Preserving Lindsay Rane Carter is an associate general counsel at Great Southern Wood Preserving, makers of YellaWood®. An alumna of Auburn University and Jones School of Law, Carter now represents one of the most profitable businesses to come out of Alabama.
- Rick Clementz – General Counsel and Corporate Secretary, Mercedes-Benz US International, Inc. Trained as an engineer, Clementz manages employment, liability defense, patent defense, all contracts and international law for Mercedes-Benz International in Vance, Alabama. MBUSI exports more than $1 billion in finished product. Located in Tuscaloosa County, MBUSI employees 3,800 Alabamians and is the sole distribution site for the GLE, GLS, GLE Coupe models, sold in 135 countries.
- Miller Girvin – CEO, Alabama Capital Network Miller Girvin is the CEO of the Alabama Capital Network (ACN), a community economic development organization whose mission is to facilitate the growth of the entrepreneurial ecosystem in Alabama. Girvin connects Alabama-based companies with valuable resources and connections and facilitates relationships with venture capital to continue upward trajectory.
- Abe Harper – CEO, Harper Technologies Abe Harper is the president and CEO of Harper Technologies, a comprehensive IT support and consulting firm based in Mobile. Harper has been working in the IT industry since he was a teenager and has expanded his business from serving residential clients to now serving small-to medium-sized businesses, nonprofits and local government entities throughout Mobile and Baldwin counties, as well as surrounding counties in neighboring states.
- Shegun Otulana – Founder, TheraNest Shegun Otulana is the Founder of TheraNest and its parent company Therapy Brands, the leading provider of software technology solutions for mental, behavioral, and rehab health providers and organizations. In 2020, he stepped down as CEO and currently serves as Vice Chairman of the board. Prior to Therapy Brands, Shegun founded Zertis Technologies, a computer software consultancy company. He currently serves as Founder/CEO of HVL, an idea and growth studio that owns and operates a family of technology companies.
- Peggy Sammon – CEO, GeneCapture, Inc. Peggy Sammon is an experienced entrepreneur with a background in multiple high-tech start-ups in environmental monitoring, wireless, and biotech. Sammon serves as CEO of GeneCapture, a start-up medical device company at HudsonAlpha Institute for Biotechnology.
- Sen. Malika Sanders-Fortier –Senator Sanders-Fortier is a Selma, Ala. native and has served in the Alabama State Senate since 2018. She is a member of the Finance and Taxation Education, Judiciary, Governmental Affairs, Fiscal Responsibility and Economic Development, Children Youth and Human Services and Veterans and Military Affairs committees.
- Arndt Siepmann – Deputy Director of Economic Development, City of Auburn Arndt Siepmann is the Deputy Director of Economic Development at the City of Auburn. In his career, has worked in various economic development corporations, including on a regional and state level. He started the Entrepreneurship and Technology Program for the City of Auburn and leads the Auburn Regional Launchpad competition. Siepmmann also works with the Auburn University Harbert College of Business to support student entrepreneurship efforts.
- Charisse Stokes – Executive Director, TechMGM Charisse Stokes serves as Executive Director of TechMGM, the collaboration of local, industry, educational and governmental entities working to leverage Montgomery’s technology assets to focus on economic, workforce and community development. Over the past 20 years, Stokes has held numerous IT and programming positions across the Department of Defense, industry and nonprofit organizations.
- Neill Wright – President, Bronze Valley Neill Wright is a co-founder and executive director of Bronze Valley, a non-profit, early stage venture investment platform that supports high growth, innovation and technology-enabled companies created by diverse, underrepresented and underestimated founders. He has more than 25 years of experience as an investor, entrepreneur and operating executive.
Advisory Council Members:
- Zeke Smith – Executive Vice President, Alabama Power (President) With more than 35 years of service with the utility, Zeke Smith is responsible for the company’s Environmental Affairs, Charitable Giving, Corporate Affairs, Governmental Relations, Public Relations and Regulatory Affairs functions. Smith also serves as chairman of the Alabama Power Foundation’s Board of Directors, in addition to serving on the boards of numerous external organizations.
- Greg Canfield – Secretary, Alabama Department of Commerce As Secretary of the Alabama Department of Commerce, Greg Canfield works closely with the governor’s office to organize economic development efforts that shape sustainable growth strategies and drive dynamic job creation across the state. His primary responsibilities include increasing business recruitment and expansion activity, expanding export opportunities for Alabama companies, improving workforce development initiatives, enhancing small business growth, and providing avenues for job creation in the film and entertainment industry.
- Chris Moody – Partner, Foundry Group Chris Moody is a partner at the venture capital firm, Foundry Group, focusing on investments in technology companies. He has worked closely with some of Silicon Valley’s fastest growing technology companies to help them formulate and execute their platform strategies. Prior to joining Foundry Group, Moody was GM & VP of Twitter’s Data & Enterprise Solutions business.
- Dr. Condoleezza Rice – Incoming Director of the Hoover Institution Former U.S. Secretary of State Condoleezza Rice has vast experience in the technology sector and is the incoming Tad and Dianne Taube Director of the Hoover Institution. The Hoover Institution at Stanford University is the nation’s preeminent research center dedicated to generating policy ideas that promote economic prosperity, national security and democratic governance. Dr. Rice is also a founding partner at Rice|Hadley|Gates, LLC, an international strategic consulting firm based in Silicon Valley and Washington, D.C.
- Bill Smith – Founder, Smith Ventures Bill Smith is CEO of Smith Ventures and the founder and former CEO of Shipt, a membership-based marketplace, enabling same-day delivery of fresh foods and household essentials across the US. Shipt was acquired by Target in December 2017 for $550 million and operates as an independent subsidiary serving multiple retailers. He recently launched Landing, a startup offering flexible leasing memberships for long-term living
- Jared Weinstein – General Partner, Thrive Capital Jared Weinstein is a native of Birmingham and is currently a partner at Thrive Capital, a New Yorkbased venture capital firm. In 2013, he founded the Overton Project, a social investment platform that has focused on scaling national best-in-class impact organizations to Birmingham – specifically Breakthrough Collaborative, Venture for America, and Microsoft’s TEALS computer science program. Prior to Thrive, Weinstein spent seven years at the White House in various roles.
Alabama Power is returning $100 million to customers
The Alabama Public Service Commission approved a plan Tuesday to credit Alabama Power Company customers on their October bills. The move returns approximately $100 million to Alabama Power Company customers.
“Putting money back into the pockets of hard-working Alabamians is one of the ways we can help on the road to recovery,” Public Service Commission President Twinkle Andress Cavanaugh said on social media. “Alabama Power to refund $100 million to customers.”
The typical Alabama Power customer will receive a $25 credit on their October bill. The newly approved credit is on top of a 3 percent rate reduction that customers are already enjoying in 2020. This previous rate cuts and the October credit amount to about $300 million in savings for Alabama Power customers this year.
“We appreciate the commission voting today to expedite this credit for our customers,” said Richard Hutto, Alabama Power’s vice president of regulatory affairs.
The global economic collapse due to the COVID-19 pandemic has hurt people across Alabama. It has also dramatically lowered fuel costs for Alabama Power Company’s plants.
A typical residential customer using 1,000 kilowatt-hours of electricity per month is expected to receive a credit of $25. Customers who use more energy will receive a larger credit. Customers who use less power receive a smaller credit but had a smaller bill to begin with. Adjustments to fuel costs are typically calculated at the end of the year, with savings passed to customers beginning in January, but due to the economic downturn and pandemic-related job losses, Alabama Power and the PSC are rushing that money to Alabama families and businesses.
“Many of our customers have been hurt by COVID-19. We hope this credit will provide some additional relief at this difficult time,” Hutto explained.
The 3 percent rate reduction, that took effect in January, was based on earlier estimates of lower costs for fuel and other expenses for 2020. The rate reduction alone equates to about a $4.50-per-month reduction for the typical residential customer.
“Our employees are working every day to keep costs low while providing industry-leading reliability for our customers,” Hutto added.
Alabama Power said in a statement that their total retail price is below the national average and has been for decades. When adjusted for inflation, the price customers pay for electricity is lower today than it was 30 years ago.
Alabama Power has been assisting customers in other ways during the COVID-19 outbreak. Since the start of the pandemic, the company has suspended disconnects and late payment fees for customers hurt by the coronavirus.
Cavanaugh is seeking another term as president of the Commission.
“It is crucial that we have strong pro-jobs conservatives supporting President Trump’s agenda at all levels of government,” Cavanaugh said on social media.
Payroll Protection Program deadline has been extended to Saturday
Congresswoman Martha Roby, R-Montgomery, this week reminded business owners that the deadline to apply for the Payroll Protection Program, knowns as the PPP, has been extended to Saturday.
“The Small Business Administration’s Paycheck Protection Program (PPP) application deadline was recently extended to Saturday, August 8,” Roby wrote in an email to constituents. “Do not forget to fill out your application if you are a small business that has been impacted by the Coronavirus pandemic.“
The PPP was a loan program administered by the Small Business Administration. It was part of the bipartisan CARES Act to address the economic collapse caused by the COVID-19 global pandemic and the forced economic shutdowns, which were implemented in the early months of the public health emergency in an attempt to slow the spread of the novel strain of the coronavirus and allow public health agencies and health care systems time to build up testing, contact-tracing and hospital bed capacity.
The PPP loans are 1 percent interest loans available through the SBA. If the business uses the money to make payroll and pay standard operating expenses then the loans will be forgiven. Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease. The loan forgiveness form and instructions include several measures to reduce compliance burdens and simplify the process for borrowers.
The PPP has been very popular, so much so that that program ran out of money just weeks after Congress passed it. Congress had to go back and provide more funding for the PPP.
Businesses can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating in the program.
Senate Democrats are meeting with the Trump Administration, Senate Republicans and House leadership on a compromise plan for a fifth coronavirus relief package. A big point of contention has been the size of the total package. Speaker of the House Nancy Pelosi, D-California, supports a $3.2 trillion coronavirus relief bill while Republicans prefer a more modest $1 trillion relief bill. The two sides are expected to continue to negotiate through Friday in an attempt to reach a compromise before the August recess.
Roby is serving in her fifth term representing Alabama’s 2nd congressional district. She is not seeking re-election.
State’s unemployment claims slowed last week
Last week saw the lowest number of new claims since the week-to-week number first spiked from 1,824 to 10,982 when the lockdown started in mid-March.
The number of unemployment claims in Alabama slipped last week after increasing through the first half of July.
There were 17,439 claims filed from July 19 to 25, according to the Alabama Department of Labor. Of those, 15,461, or 89 percent, were COVID-19 related.
Claims soared at the start of the pandemic in late March, hitting a weekly high of 106,739 in the first week of April. The rate of new claims declined sharply in May, with each week counting under 30,000 claims.
Since then, the number has decreased somewhat steadily. Claims rose several thousand over the course of this month, from 19,058 in the week ending July 4 to 23,678 in the week ending July 18.
Last week saw the lowest number of new claims since the week-to-week number first spiked from 1,824 to 10,982 when the lockdown started in mid-March.
GDP fell by an unprecedented 9.5 percent in second quarter
The Bureau of Economic Analysis released its advance estimate of U.S. GDP for the second quarter of 2020 reflecting the months of April, May and June dropped 9.5 percent in the second quarter, According to the BEA report, real GDP contracted at an unprecedented annualized rate of 32.9 percent. This is the largest quarterly decline since the series began in 1947, though market expectations were so low the actual number was slightly better than what the market and official estimates had expected.
President Donald Trump’s Council of Economic Advisors said that despite this massive contraction, the resiliency of the U.S. economy and the swift fiscal response of the Federal Government can aid in a strong recovery.
The Council of Economic Advisors said that the U.S. economy entered this contraction on a healthier and more resilient footing than it did both prior to the Financial Crisis of 2008 to 09 and relative to other advanced economies. This was due in part, to the longest expansion in U.S. history. American households also had a smaller overall debt burden prior to this pandemic than prior to the Financial Crisis. Household liabilities as a percent of personal disposable income were 136 percent leading into the Financial Crisis but were below 100 percent prior to this pandemic.
The United States had the highest growth rate among the G7 countries prior to the pandemic, with growth roughly double the non-U.S. G7 average.
The second-quarter decline in GDP was widespread, touching nearly every facet of the economy. Consumer spending, which accounts for roughly 70 percent of the U.S. economy, contributed to most of the decline, accounting for 25.05 percentage points of the 32.9 percent decline. The report also showed sharp contractions in business fixed investment, residential investment, inventory investment, and state & local government spending which contributed to the decline.
A massive but uneven decline in consumer spending (-34.6 percent at an annualized rate) revealed how quarantines have driven spending patterns. Individuals increased consumption of recreational goods & vehicles and housing & utilities, but lessened consumption of gasoline & other energy goods, health care, transportation services, recreational services, and food services & accommodation. The decline in business fixed investment was also widely spread, though it was particularly sharp in transportation equipment investment and mining structures investment, the latter reflecting subdued oil and gas production activity responding to extraordinarily low prices.
The pandemic and the forced economic shutdowns caused a sharp drop in real personal income as many workers faced lower wages, fewer hours or loss of their jobs completely. The University of Pennsylvania estimates that the CARES Act reduced the GDP contraction in the second quarter by 7 percentage points.
The Council of Economic Advisors are predicting strong real GDP growth in the third quarter. The current Blue Chip consensus forecast of 17.7 percent annualized growth in the third quarter would be the largest recorded quarterly growth rate and a 36 percent recovery of the second quarter contraction.
The Council of Economic Advisors claim that the pace of the recovery so far has exceeded expectations, providing a source of optimism as we look ahead. In fact, the majority of major economic data releases over the past month—reflecting May and June data—have surpassed market outlooks. Most notably, the record-breaking number of jobs added in both May and June beat market expectations by a combined 11.7 million. Furthermore, high-frequency data indicate that 80 percent of America’s small businesses are now open, up from a low in April of just 52 percent. Consumer credit & debit card spending has recovered roughly 80 percent from the pandemic low, with spending in low-income zip codes rebounding the furthest, now just 2 percent below pre-pandemic spending levels.
Another 1.43 million Americans filed initial unemployment claims last week, the nineteenth week the total has surpassed one million new claims.
The recovery could be threatened by surging coronavirus cases, which could force a second shutdown in some states. Governors in Texas, Florida, and California have had to implement some social distancing restrictions and Alabama Gov. Kay Ivey has had to impose a mask requirement on all citizens and even on school children.
The uncertainty with the virus and the economy has put pressure on Congress to approve another coronavirus relief package.
“Our nation is going through a time of testing,” Vice President Mike Pence said. “And let me say from my heart that our prayers and our sympathies are with all of the more than 150,000 families that have lost loved ones in the midst of this pandemic. As we continue to contend with the coronavirus in various places across our country, President Trump and our team, and the task force will continue to marshal the full resources of the federal government and the full power of the American economy to meet this moment and put the health of America first.”
“It’s amazing to think, at the lowest point in this pandemic, our economy lost 22 million jobs,” VP Pence said. “But thanks to that solid foundation that President Trump laid in our first three years, we’ve already gained back 8 million jobs just in May and June alone.”