Friday, March 23, 2018
2018 LEGISLATIVE UPDATE: WEEK ELEVEN
With the end of the 2018 Regular Session set for next week, the Legislature’s work has taken on a slightly more frantic pace. Both the House and the Senate met for three session days this week, working in committee meetings Tuesday and Wednesday around votes on the floor. The House has continued its trend of slowing down over contentious legislation, while the Senate has largely avoided discord.
On Tuesday, the House spent quite a few hours debating the very first bill on the day’s calendar, SB311, sponsored by Senator Jabo Waggoner (R–Vestavia Hills). The bill would levy an additional tax on car rentals in Jefferson County to finance a renovation of the BJCC and the construction of an open-air stadium at the facility. While the bill passed the Senate unanimously earlier in the session, it had become a cause for significant disagreement between members of the Jefferson County delegation by the time it made it to the floor of the House. Ultimately, the bill passed by a vote of 14–3, with 45 abstentions. The extended debate on the bill left too little time for House to take up a calendar including a very controversial gun bill, HB435, sponsored by Representative Will Ainsworth (R–Guntersville), which would have allowed trained, certified teachers to carry guns on campus. Because there are so few days left in the session, HB435’s failure to advance has foreclosed the possibility of its becoming law this year.
On Thursday, the House spent most of its day debating the second bill on its calendar, SB181, sponsored by Senator Gerald Dial (R–Lineville). The bill would propose a constitutional amendment, to be voted on directly by the citizenry at the next election, permitting the display of the Ten Commandments on public property. The bill ultimately passed by vote of 66–19.
Rural Broadband Incentives Receive Final Passage
One of the bills that the House did manage to pass on Tuesday night was SB149, sponsored by Senator Clay Scofield (R–Guntersville). The current version of the bill, which has been substituted and amended several times, seeks to accelerate private investment in rural broadband by creating a fund from which the Alabama Department of Economic and Community Affairs may issue grants to broadband providers. The grants would support providers’ investments in either unincorporated areas of the state with fewer than 25,000 residents or areas of the state that are currently unserved by broadband. Under the proposed law, the grants could not exceed either $750,000 or 20% of the overall cost of the investment, whichever is less. The total amount of grants issued in a single year could not exceed $10 million. The bill was amended on the House floor by Representative Nathaniel Ledbetter (R–Rainsville) to better align the proposed state law with federal broadband incentives—such as the significant line item in the federal omnibus spending bill that passed the United States Senate on Friday—and so went back to the Senate for a unanimous vote to concur on Wednesday. The bill now only awaits the Governor’s signature.
Data Breach Act Passes House
One of the bills that the House managed to pass on Thursday night was SB318, sponsored by Senator Arthur Orr (R–Decatur), which would create penalties for failure to notify affected individuals that their personal data has been compromised. The bill, which is known as the Alabama Data Breach Notification Act, requires both public and private entities that hold sensitive information to establish reasonable security measures for protecting that information. Furthermore, the bill would require any entity that has been breached to conduct an investigation and, upon determining that any breached information is “reasonably likely to cause substantial harm” to notify the affected individuals as “expeditiously as possible,” but in no case later than 45 days after discovery. Under the proposed law, knowing or willful failure to notify could result in the imposition of significant penalties under Alabama’s Deceptive Trade Practices Act of up to $500,000. The current version of the bill would also largely exempt entities that are subject to federal regulations or requirements in the event of a breach from many of the law’s requirements. Alabama is one of only two of states that do not have some form of data breach law on its books. Proponents of the legislation, including Attorney General Steve Marshall, have worked with the business community and other branches of state government to craft a bill that is widely seen as fair and reasonable. The bill received a technical amendment before a unanimous vote for final passage. As a result, it will return to the Senate for a vote to concur, which is widely expected to take place next Tuesday. Because South Dakota passed its proposed data breach law earlier this week, Alabama will be the last state to pass such a law.
General Fund Budget Receives Final Passage
On Wednesday, the Senate unanimously voted to concur in the House’s version of the General Fund budget, which allocates all of the State’s non-education spending for next fiscal year. The budget, which originated in the Senate this year but received some minor changes in the House, is roughly $160 million larger than the budget passed last year at $2.03 billion. The single greatest beneficiary of the increase is the Department of Corrections, which will receive an additional $54 million next year. The additional funds will help fund the hiring of new Corrections personnel and improvements to mental healthcare for inmates. The Department is currently in the remedy phase—with liability already having been found—of a lawsuit in federal court over the quality of mental healthcare provided to inmates. Other significant increases included an additional $8.9 million for the Department of Mental Health, $3.1 million for the Department of Human Resources, and $2.4 million for the Department of Public Health. The Governor signed the budget into law on Thursday.
Other Budget- Related Bills Signed by Governor
The Governor signed several other budget-related bills on Thursday, including SB185, sponsored by Senator Clyde Chambliss (R–Prattville), which gives state employees and some county employees a 3 percent pay increase; HB174, sponsored by Representative Bill Poole (R–Tuscaloosa), which gives public education employees at K–12 schools, the Alabama Institute for Deaf and Blind, the Alabama School of Fine Arts, the Alabama High School of Mathematics and Science, and some two-year postsecondary institutions a 2.5 percent pay increase; and SB215, sponsored by Senator Gerald Dial (R–Lineville), which authorizes a one-time bonus for state retirees equal to $1 for each month employed.
Education Trust Fund Budget Sent to Conference Committee
On Tuesday, the House voted to send the Education Trust Fund budget to conference committee. The budget, which originated in the House this year but was changed slightly in the Senate, is the largest in a decade at $6.6 billion and exceeds this year’s by roughly $216 million. The current version of the budget includes significant increases to various programs, including an additional $18.5 million for Alabama’s highly regarded Pre-K program, and $4 million for the Alabama Reading Initiative. The budget is expected back on the floor of both chambers early next week.
Economic Development Ethics Clarification Nears Final Passage
On Wednesday, by a vote of 10–2, the Senate Committee on Fiscal Responsibility and Economic Development favorably reported a bill that would clarify that economic development officials are not lobbyists. HB317, sponsored by Representative Ken Johnson (R–Moulton), addresses a concern raised in recent years that individuals hired to negotiate economic development packages as part of efforts to recruit business investment to the state might arguably be engaged in lobbying activities. The bill caused considerable debate in the House earlier in the session, and the committee’s public hearing on the bill last week brought several high profile officials to the State House to testify, including Commerce Secretary Greg Canfield, who described the bill as critical to the State’s economic development efforts, and Chair of the Ethics Commission Jerry Fielding, who testified that four out five of the State’s Ethics Commissioners support the bill. Before voting to send the bill to the full Senate, the committee adopted three largely technical amendments. As a result, should the bill pass the Senate this coming week, it will have to go back to the House for a vote to concur.
Simplified Sellers Use Tax Bill Nears Final Passage
The Senate took up but carried over HB470, sponsored by Representative Rod Scott (D–Fairfield), on Thursday. The bill would amend the existing Simplified Sellers Use Tax program, which passed the Legislature in 2015 and currently allows for online sellers to lock in a lower sales tax of 8 percent if they opt in. Several versions of a fix for the current law have been introduced this session, prompted by Amazon’s acquisition of Whole Foods last year, which triggered a review of whether the online retailer could continue to pay the flat 8 percent tax. HB470 would keep the SSUT rate at 8 percent for sellers, but would extend the application of the program to so-called “marketplace” transactions, thus including sales by third parties on websites like Amazon. For these sales now captured by the law, revenues would be split 60%-40% between cities and counties respectively. The bill did receive some opposition on the floor, but is positioned to be called up and voted on at any time. Because of two amendments—one from the Senate committee and a technical floor amendment—the bill will have to go back to the House for a motion to concur.
The Legislature has used 23 of its available 30 meeting days for the 2018 Regular Session. The House will reconvene on Tuesday, March 27th at 11:00 a.m. The Senate will reconvene at 2:00 p.m. on the same day. Next week is anticipated to be the last of the session and a two legislative day week, with both chambers in session and voting on both Tuesday and Wednesday and adjourning sine die on Wednesday evening. However, because the best reading of the state’s constitution would seem to require that if the session ends on Wednesday, the Governor would have to sign every bill passed yesterday in order for it to become law, there is some discussion of extending the week to a third, likely very brief, legislative day on Thursday.
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