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2010 Legislative Session Roundup: Alabama

Alabama’s three month legislative session that adjourned on April 22 was dominated by three issues -- passing a state budget, a controversial bill to bring a referendum on whether to make electronic bingo legal and legislation to bail out the state’s popular pre-paid college tuition program.

Budget, Tax and Revenue:  As with so many other states, Alabama faced a large budget shortfall this year.  Based on estimates from the Legislative Fiscal Office, the state's general fund faced a shortfall of about $600 million this fiscal year.  But largely through the use of state rainy day funds and federal aid the state received through ARRA money, major cuts in education, health and services programs were avoided.

The legislature made their budget situation worse by approving new corporate tax breaks (HB 260) in the name of subsidizing employers who hire unemployed workers up to 50 percent of wages paid to new hires. 

Unfortunately, a more positive measure for working families was defeated.  A broad-based campaign proposed repealing the 4 percent state tax on groceries and over the counter medications, while raising revenue by eliminating the deduction for federal taxes paid by higher-income earners.  The constitutional amendment (HB 1) received a  vote of 54-42 in the House of Representatives, but the proposal fell just 9 votes short of the 63 votes needed to bring the bill to the House floor for debate.

Electronic Bingo: The most controversial bill of the year was one that would have let voters decide whether to declare electronic bingo legal and set up a gaming commission. While SB 515 passed the Senate, it died without a vote because the sponsor wasn’t able to find enough backing for the bill among other House members. Opponents viewed the bill as bad public policy, especially a provision where, if it had been approved by the voters the Legislature could have revisited the bill to create rules for bingo operations. During the time the bill’s fate was being decided, federal authorities revealed an investigation into possible corruption in the legislature involving the bingo bill.

Education:  One major bill that did pass was to appropriate funds for the state's prepaid college tuition program (PACT).  The PACT program covers about 45,000 children.  The Prepaid Affordable College Tuition program ran into trouble when the stock market collapsed last winter.  The program's assets, once valued at nearly $900 million, were heavily invested in stocks, and their value plunged below $500 million.  However, despite initial differences between the House and Senate over whether to establish a cap for state university tuition increases, Senate Bill 162 will provide the program with a total of $236 million over eight years, as it was signed into law on April 30th.

Transportation: A major transportation bill did pass the legislature this session. SB 120, a proposed constitutional amendment that authorizes the Alabama Trust Fund to make payments of $100 million each year for 10 years for road & bridge construction, maintenance and repair programs in the state’s transportation infrastructure. The measure has been placed on a November ballot initiative. If approved, the state will make an annual distribution of $25 million of the $100 million to cities and counties based on the state’s gasoline tax distribution formula, $74 million to the Alabama Department of Transportation (ALDOT) and $1 million to the Alabama Shortline Railroad Infrastructure Fund.

Environment and Energy: The Alabama Permanent Joint Legislative Committee on Energy and interest groups worked to pass several bills pertaining to energy and energy efficiency. Among the bills passed was HB 128 , which provides for the “Codification of the Joint Legislative Committee on Energy Policy” and provides for an ongoing state energy study and energy plan.  Additionally, SB 315 requires the adoption of the Alabama Energy and Residential Codes to comply with certain federal energy and building requirements.

Defeated Bills Included:

  • Charter Schools: Legislators also defeated attempts to allow charter schools in the state (HB189 and SB202). 
  • Health Care: Alabama joined 24 other states in rejecting bills (SB 233 and its companion, HB 47) calling for states to prohibit mandatory participation in the health care system established by the federal health care reform bill.
  • Immigration: The best immigration news to come out of Alabama’s legislature this session is the fact that no anti-immigrant bills were passed. One highlight though was the passage of a bill, HB 432 to make human trafficking a crime in Alabama. The new law provides for much harsher penalties for the criminals and more protections for victims than were previously provided under kidnapping statutes.

Defeated Affordable Housing: Even though a bill (HB 512) to create a state Affordable Housing Trust Fund sailed in the House unanimously (91-0), it never came up for a vote in the Senate. The estimated shortage in the number of affordable housing units in Alabama totals about 45,000. Alabama is one of only 12 states that has not established a housing trust fund as a strategy to address housing shortages.

Resources:
Arise Citizens' Policy Project - Untax Groceries
Arise Citizens' Policy Project - Issue Priorities for 2010
Alabama Appleseed - Immigrant Policy
Sunshine Review - Alabama State Budget
The Birmingham News - Alabama Legislature adjourns; PACT Bailout Approved, No Action on Bingo or State Song
Progressive States Network - Right-Wing Obstruction of Health Care in the States