Friday, February 9, 2018
2018 LEGISLATIVE UPDATE: WEEK FIVE
Alabama’s constitution limits each Regular Session of the Legislature to just 30 meeting days. As of adjournment yesterday—the 10th meeting day of the year—the session is now one third complete. Leadership’s goal of a brief, noncontroversial session still seems attainable, with many bills continuing to pass nearly unanimously in the Senate and only relatively brief delays in the House. Some of the efficiency is due to the relative health of the state’s two budgets, but much of it is also due to discipline from leadership, which has worked to keep legislative calendars and committee agendas full of generally popular and narrowly focused bills.
The Education Trust Fund (“ETF”) budget passed out of committee this Wednesday in the House with virtually no debate and with praise from both Democrats and Republicans. While it is not a requirement, it is tradition that the two chambers of the Legislature take turns focusing on each of the state’s two budgets. This year the House is responsible for generating the state’s Education Trust Fund budget, and the Senate will generate the state’s General Fund budget. While each will still be subject to scrutiny and amendment in the other chamber, the bulk of the work is done in the budget committees in the chamber of origin. This version of the budget, HB175, sponsored by budget committee Chairman Bill Poole (R–Tuscaloosa), is therefore expected to be largely similar to what will eventually pass into law.
Due to the gradually improving economy in the state, this year’s $6.63 billion ETF budget is $216 million larger than last year’s and the largest that the state has had since the start of Great Recession. Nearly half of the increase would fund a 2.5% pay raise for K–12 and community college educators. The state’s Public Education Employee Health Insurance Program, known as PEEHIP, would also see an increase in funding, which should ensure that teachers’ premiums do not rise this year and so cut into their raises. Among various other smaller increases to specific programs, the state’s widely celebrated Pre–K system would receive $20 million in additional funding under the proposed budget. The budget now moves to the House as a whole, where it is expected to be taken up next week.
Statewide Uber and Lyft Bill Moves to Senate for Final Passage
The Senate Committee on Tourism and Marketing favorably reported HB190, sponsored by Representative David Faulkner (R–Mountain Brook), on Wednesday after a brief public hearing at which a representative of the Huntsville Airport Authority expressed concerns about the bill. The bill would allow the state directly to regulate transportation network companies—such as Uber and Lyft—through the Public Services Commission. In essence, the bill would allow services like Uber and Lyft to operate statewide, rather than working out individual agreements with various municipalities or authorities. The bill has been introduced for each of the past few years, but has generated opposition from some municipalities that already have agreements with the companies and that are resistant to a loss of direct oversight. The bill as reported still includes an amendment by Representative Juandalynn Givan (D–Birmingham) incorporating Title 7 of the Civil Rights Act, at which the House arrived after a lengthy debate over nondiscrimination language in the bill last week. Alabama is one of only six states in which transportation network companies operate that does not have such a law. The bill now moves to the Senate as a whole for final passage.
Governor Ivey signed a bill into law on Tuesday that would allow counties to abate ad valorem taxes for large economic development projects. SB98, sponsored by Senator Arthur Orr (R–Decatur), permits county commissions to grant an abatement of all or a portion of all county ad valorem taxes owed on properties within their counties. The property must be used for a project that qualifies for economic incentives under the Alabama Jobs Act, which the Legislature renewed and reworked last year, and which sets requirements for investment levels and job creation. The project must also be significant in size; under the proposed law, the project must anticipate investment of more than $50 million in the construction, rehabilitation, or outfitting of its facility.
Direct Payment of Chiropractors
A bill that would allow chiropractors to take direct payments from patients without being regulated as selling insurance passed the Senate on Tuesday. SB234, sponsored by Senator Priscilla Dunn (D–Bessemer) would treat chiropractors in roughly the same way as doctors who choose to receive direct payments from their patients under a law passed last year. In essence, the bill would allow chiropractors to charge an agreed-upon fee for treatments over an agreed-upon time. The bill clarifies that such arrangements would not be treated as insurance, and so would not be regulated by the state’s Department of Insurance. As a general rule, however, physicians or chiropractors who take payment—other than copays—from patients are not eligible to participate in many insurance networks.
First-time Homebuyer Accounts Passes House
On Tuesday, the House unanimously passed a bill, sponsored by Representative Kyle South (R–Fayette), which would allow Alabamians to claim a tax deduction for saving money towards the purchase of either their first home or a so-called “second chance” home. As amended on the House floor, HB248 would allow an annual income tax deduction of up to $6,000 for individuals and $12,000 for couples for up to five years for deposits made into an account set aside for the purchase of a home. In order to qualify, purchasers must not have owned or purchased a home for the preceding five years. If the bill passes, Alabama would become the seventh state to offer first-time homebuyer accounts.
A bill that would create an amnesty program for all taxes other than motor fuel, motor vehicle, and property taxes passed out of the House Thursday by a vote of 94–1. HB137, sponsored by Representative Ken Johnson (R–Moulton), would create a three-month window—from July 1st through September 30th of this year—during which Alabama taxpayers could pay any taxes owed from before January 1, 2017 without penalties or interest. In order to be eligible for the program, the taxpayer cannot have already been audited or contacted about the unpaid taxes the Department of Revenue. The taxpayer would also be required to waive any right to dispute the amount of the taxes owed. The bill now moves to the Senate, where it has been referred to the Committee on Fiscal Responsibility and Economic Development.
Direct Shipment of Wine Carried Over
On Wednesday, the Senate Committee on Fiscal Responsibility and Economic Development carried over a bill that would allow licensed wine manufacturers to ship wine directly to Alabama consumers. SB243, sponsored by Senator Bill Holtzclaw (R–Madison), would allow any Alabama-licensed wine producer, whether located in the state or not, to apply for a permit to ship wine directly to an individual for personal use. As introduced, the bill would limit the amount of wine that a producer could ship to any individual at 24 cases per year and would require that the purchaser be verified to be 21 years of age.
Agency Day in the House
After a contentious debate on Tuesday over a bill authorizing state agencies to display “In God We Trust” on public property, the House worked swiftly through a calendar of so-called “agency bills” on Thursday. Agency days are intended to help move non-controversial pieces of legislation, often requested by agencies themselves, through the House quickly. Among the bills that passed during the expedited process were bills to require vehicles to move over when approaching a parked Department of Transportation vehicle, to abolish the office of Deputy Game Warden, and to require competitive bidding for transportation projects larger than $250,000. As part of the package, the House also passed HB22, sponsored by Representative Chris Pringle (R–Mobile), a bill that would eliminate various obsolete agencies and commissions. The bill is similar to others that Representative Pringle has introduced in recent years in an effort to clean up the Code.
The Legislature has used 10 of its available 30 meeting days for the 2018 Regular Session. While the Legislature has a 105 calendar day window in which to meet, hopes remain high that the session will conclude by the end of March. The House and Senate will both reconvene on Tuesday, February 13th at 2:00 p.m. Next week is anticipated to be a two legislative day week, with Wednesday reserved for committee meetings.
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