Friday, January 26, 2018
2018 LEGISLATIVE UPDATE: WEEK THREE
Unlike last week, which was significantly disrupted by snow, the third week of the 2018 Regular Session of the Alabama Legislature was quite busy. Perhaps as a result of continued hopes for a relatively brief session unmarred by controversy, both chambers moved swiftly through their committee agendas and voting calendars. While there were brief flares of resistance to some bills, no full-scale filibusters have yet occurred in 2018. The House and Senate Republican Caucuses’ agendas continue to be the focus of activity.
Medicaid Tweaks in the Senate
Alabama’s Medicaid Agency has—for the first time in several years—actually requested less money for the next fiscal year than for the current one. Nevertheless, several bills currently before the Legislature would make changes to the agency’s eligibility standards and collection procedures.
SB140, sponsored by Senator Arthur Orr (R–Decatur), would require Medicaid to verify the eligibility for coverage of individuals currently enrolled in the plan, and authorize the agency to contract with a third-party vendor to do the research necessary to ensure that eligibility. The bill would also establish a semiannual review of continuing eligibility for Medicaid recipients. As introduced, the bill also established a detailed set of work requirements for some recipients. Essentially, the bill as introduced would have made eligibility for able-bodied adults contingent on proof of employment for at least an average of 20 hours per week. The work requirement met with opposition from the Democratic Caucus and generated concern that the Centers for Medicare and Medicaid Services (“CMS”), which is the federal agency responsible for administering Medicare and Medicaid, might not approve of the plan. As a result, the Senate Committee on Fiscal Responsibility & Economic Development substituted the bill on Wednesday, removing the specifics of the work requirement. In the new version of the bill, the state’s Medicaid agency is instead obliged to request a waiver from CMS for a work requirement that is “the firmest but nonetheless most reasonable . . . allowed by CMS.” Senator Orr noted that the change came at the request of the Governor’s office, and would allow Medicaid greater flexibility in negotiating an overall waiver for the state’s program. The bill passed the committee by a vote of 11–1 and is awaiting a final vote by the Senate as a whole.
SB93, also sponsored by Senator Orr, would allow Medicaid to place a lien on the real property of a deceased recipient of Medicaid benefits. Federal law requires state Medicaid agencies to pursue recovery from the estates of recipients of long-term care. In short, the requirement is meant to allow Medicaid to keep their homes during their lifetimes, but to defray the government’s overall costs by permitting recovery of medical expenses after the recipient’s death. SB93 would simply bring Alabama into compliance with the federal requirement, and is a Republican Caucus agenda item. The bill passed the Senate by a vote of 25–0 on Thursday, after a substitute making largely technical changes was adopted.
Tax Cut Moves to the House
SB76, sponsored by Senator Del Marsh (R–Anniston), passed the Senate unanimously on Thursday. The bill, which is also part of the Senate Republican Caucus agenda, would raise the threshold for claiming the maximum exception for state income taxes for low- and middle-income earners. For married couples filing jointly, heads of households, and single filers, the income threshold for claiming the maximum exception would be raised from $20,000 to $23,000. For married couples filing separately, the threshold would be raised from $10,000 to $10,500. The overall impact of the bill is projected to be a $4 million savings for taxpayers annually. The Republican Caucus has cited increased fiscal discipline at the state level and the improving economy as the reasons for the cut. Proponents champion the bill’s targeted relief for individuals and families who earn the least. The bill will now move the House Committee on Finance and Taxation Education for consideration before a vote in the House.
Rural Broadband Initiative
SB149, sponsored by Senator Clay Scofield (R–Guntersville), received a favorable report from the Senate Committee on Fiscal Responsibility & Economic Development on Wednesday. The bill seeks to accelerate private investment in rural broadband by providing a tax credit equal to 10% of the investment made by a broadband provider in facilities in unincorporated areas of the state with fewer than 25,000 residents. Proponents of the bill liken bringing broadband to rural parts of the state to the efforts made to electrify those areas in the 20th century. The bill is likely to be substituted on the floor of the Senate in order to avoid a lengthy series of amendments making minor changes to the bill.
Senate Approves Bill Reducing Unemployment Benefits
SB92, sponsored by Senator Arthur Orr, passed the Senate on Thursday by a vote of 21–8. The bill reduces the length of time that a recently unemployed individual may claim benefits from the state from 26 weeks to between 14 and 20 weeks, depending on the unemployment rate at the time. The bill also increases the maximum amount of the benefit from $265 per week to $275 per week, and allows an extension of up to five weeks for unemployed individuals in approved job training programs. Proponents of the bill argue that the existing 26-week benefit does not provide the proper incentive to begin seeking employment promptly after leaving a job, and that having a shorter benefit brings Alabama more into line with neighboring states’ policies. The bill does not affect the state’s budgets, as unemployment benefits are paid out of the Unemployment Compensation Trust Fund, which is itself funded by employer contributions. The overall savings to the business community of the bill are projected to be nearly $53 million.
House Bills for Veterans Work through Senate
The Senate Committee on Veterans Affairs favorably reported three bills that passed the House with overwhelming support last week: HB58, sponsored by Representative Dickie Drake (R–Leeds), which would provide free admission to any state park managed by the Department of Conservation and Natural Resources to all active and retired military personnel; HB83, sponsored by Representative Connie Rowe (R–Jasper), which would raise the tax credit for businesses that hire unemployed veterans from $1000 to $2000 as well as extend the credit to businesses that hire combat veterans, even if they are not unemployed at the time of hiring; and HB88, sponsored by Representative Drake, which would grant preferred vendor status to businesses owned by veterans that bid on government projects. All three bills now move to the Senate floor to await final passage.
Bill to Eliminate Marriage Licenses Nears Final Passage
The House Committee on the Judiciary amended and then favorably reported SB13, sponsored by Senator Greg Albritton (R–Bay Minette), on Wednesday. The bill, which is seen by many as motivated by a desire to remove probate judges from any responsibility to issue licenses for marriages to which they object on moral grounds, would establish a new procedure for two individuals to marry. Under the proposed law, couples would now file affidavits, forms, and data with the state’s probate judges. Probate judges would have no authority to reject any such filing, but would simply record the marriage and forward notice of it to the state’s Office of Vital Statistics. The law would entirely do away with marriage licenses as well as the requirement that marriages be solemnized, although it would still allow for the performance of a marriage ceremony. The committee’s amendment added language to the bill that clarified that the individuals contracting for marriage must be authorized to do so under Alabama law. The amendment is seen as problematic by some, who note that Alabama still has laws on its books that prohibit same-sex marriage, despite the Supreme Court’s 2015 ruling in Obergefell v. Hodges striking down state restrictions on same-sex marriage.
First-time Homebuyer Accounts
Representative Kyle South (R–Fayette) has introduced a bill in the House that would allow Alabamians to claim a tax deduction for saving money towards the purchase of their first home. HB248, which has been referred to the House Committee on Ways and Means Education, 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 first-time purchase of a home. Under the proposed bill, funds must be used for the purchase or closing cost of a first home, and the accountholder as well as the purchased home must meet certain conditions. If the bill passes, Alabama would become the seventh state to offer first-time homebuyer accounts.
Civil Asset Forfeiture
Two identical bills introduced in the House and Senate this week would significantly restrain the practice of civil asset forfeiture in Alabama. SB213, sponsored by Senator Arthur Orr, and HB287, sponsored by Representative Arnold Mooney (R–Birmingham), and both known as the Alabama Forfeiture Accountability and Integrity Reform Act, would establish the exclusive process for asset forfeitures in the state. Civil asset forfeiture is a process by which police may seize personal property that they suspect has been used in the commission of a crime. Current law does not require that there be an underlying criminal conviction—nor even a criminal charge—for the seizure to take place. The bills would require a criminal conviction before property can be seized, a clear and efficient process for innocent parties to challenge a forfeiture, and increased reporting and transparency from law enforcement about the seizures. Similar bills were introduced last year, but were strongly opposed by the law enforcement community, which denied that the process is abused in Alabama. Proponents of the bill, representing both ends of the political spectrum, have completed a thorough year-long study of the practice and have gathered considerable evidence that there is such abuse. The bills have been referred to the House and Senate Committees on the Judiciary.
The Legislature has used six 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 will reconvene on Tuesday, January 30th at 1:00 p.m. The Senate will reconvene on the same day 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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