HBAA Legislative Alert

FULL SPEED AHEAD DURING WEEK FOUR

The Alabama Legislature met for three days this past week, concluding the first ten days of the thirty day legislative session.

Showing that it can move priority measures quickly, the Senate approved the Uniform Minimum Wage Act on Thursday. Signed by the Governor less than an hour after passage, the act effectively ends local government ability to impose a minimum wage standard. The Senate voted 23-10 to pass the measure after a decision by the Birmingham City Council to move forward the effective date of the $10.10 minimum wage to Wednesday.

The Senate swiftly changed gears to consider the General Fund Budget. The proposed budget basically provides level funding to state agencies, with a few minor exceptions. Although the budget reflects an additional $60 million in additional spending, it is still around $100 million less than the budget proposed by the Governor. The Senate passed the budget on a vote of 23-10. The budget is expected to be considered by the House General Fund Budget Committee in the coming weeks.

With a third of the session now complete, many see an early end to this year's session. Once the budgets are passed, there will be little desire to remain. Rumors are already flying that they could be done by as early as March 28. Whether that comes to pass or not, it is clear that the Alabama Legislature is living the adage of making hay while the sun is shining.

HOUSING TRUST FUND LEGISLATION INTRODUCED

Representative Patricia Todd (D-Birmingham) introduced legislation this week to fund the Alabama Housing Trust Fund (HTF). Unlike previous efforts to fund the HTF, HB 341 seeks to increase the recording tax and split the money between the HTF and the Alabama Home Buyers Initiative. Although the HBAA would like to see additional funding for the Alabama Home Buyers Initiative or other Alabama Housing Finance Authority programs that would create opportunity for consumers and stimulate the housing industry, the HBAA has significant reservations about this effort.

The HBAA looks forward to working with Rep. Todd and others to find a way to provide Alabama families access to affordable home financing through the programs offered by the Alabama Housing Finance Authority.

Sprinkler Bill Advances

A measure designed to allow plumbers to install fire sprinklers advanced this week with a favorable report from the House committee on Public Safety and Homeland Security. HB 114 has been a hot button issue for commercial fire sprinkler installers who feel that their turf is being invaded by plumbers. A recent meeting of interested parties devolved to one sprinkler contractor questioning what a plumber knows about water and piping. Obviously those groups are grasping at straws to derail the legislation, even going as far as claiming they could install the systems for as little as $1/sq ft.

Although the HBAA is adamantly opposed to mandatory fire sprinklers, it feels that allowing plumbers to install sprinkler systems for consumers who choose to have them installed not only makes sense, but it should lead to lower costs.

Interestingly, the very entities that were so insistent that fire sprinklers be mandatory in new homes are now the ones opposing the fire marshal's current efforts to allow plumbers to install sprinklers. The "life-safety" arguments that these entities exclaimed so frequently have now faded away and show that their earlier efforts were motivated by profit.

The HBAA commends Representative Tommy Hanes (R-Scottsboro) for his leadership in bringing forward this legislation to bring down the costs of residential sprinklers and for exposing the hypocrisy of those opposing his efforts.

ONSITE BILL ELIMINATES PLUMBING INSPECTIONS

Senator Clyde Chambliss (R-Prattville) introduced a bill this week to remove language from existing law that stated that the Alabama Department of Public Health was to inspect plumbing installed and connected to an onsite wastewater system. The department has not been conducting plumbing inspections other than those directly related to wastewater systems and laterals connecting a home to a community wastewater system. Plumbing inspections have always been part of the building inspection process and the language contained in the existing law served no purpose other than to cloud the process as it exists.

The HBAA would like to thank Senator Chambliss and Representative April Weaver (R-Alabaster), sponsor of the House companion bill, for their efforts to clarify the law and eliminate the potential for confusion within the onsite and plumbing industry.

ACJRC CONTINUES EFFORTS TO PROTECT ALABAMA BUSINESSES

The Alabama Civil Justice Reform Committee (ACJRC) was established to help end the days of tort-hell in Alabama when runaway civil judgments crippled Alabama's ability to promote itself as a pro-business state, open for investment. Since those days, ACJRC has continued to monitor and promote legislation that continues to advance fair and balanced judicial actions.

As a founding member, the HBAA has been crucial to the success ACJRC has enjoyed. Even now, the HBAA works closely with other like-minded business and trade groups to protect the gains that have benefited Alabama businesses. Here is a look at a few of the bills ACJRC is monitoring:

SB113 (Ward) and SB270 (Williams) Deceptive Trade Practices Act:

Two measures have been introduced that will amend Alabama's DTPA. SB113, by Senator Ward, extends the statute of limitations to a flat 4 years. Currently, a suit must be brought within 1 year from when the claimant reasonably could have discovered the alleged prohibited act or practice, but in no event after 4 years. But, the bill also eliminates a provision that could extend the statute of limitations much longer for cases involving contracts or warranties lasting longer than 3 years. ACJRC continues to work with the Attorney General and we favor shortening the statute for private litigants from 4 to 2 years.

SB270, Senator Williams' bill, is intended to overcome a recent 11th Circuit opinion that held that despite Alabama's express prohibition that prohibits a private litigant from bringing a DTPA case as a class action, the federal rules of civil procedure provide otherwise. The 11th Circuit determined that federal procedural rules trumped the state law because the state law was a procedural provision. The proposed bill declares that the anti-class feature of the DTPA is a "substantive limitation" in an effort to provide an argument in future DTPA cases filed in federal court that the 11th Circuit opinion is no longer binding. Ultimately the 11th Circuit would also have to review the issue again if this law passed. The bill also adds a new requirement that private litigants must prove detrimental reliance in DTPA cases.

HB161 (Fridy) and SB158 (Ward) Extension of Daubert Standards:

In 2011 the Legislature adopted the "Daubert standard" for admitting expert testimony based on scientific principles and knowledge. This requires a far more rigorous standard for such expert opinions than the old law and was designed to weed out the major issue in civil litigation with respect to experts, so-called "junk science." This was one of ACJRC's 2011 tort reform initiatives. HB161 and SB158 extend Daubert to other areas of expert witness testimony and require the same standards to be met for introduction of all other opinion testimony. Both bills are pending in the Judiciary Committee of their respective chambers.

SB67 (Ward) Lawsuit Lending:

A bill to regulate lawsuit lending, "the practice of loaning funds to the plaintiff awaiting the outcome of a pending lawsuit," has been reintroduced again this session. It limits lawsuit lending finance charges to 10%. It passed out of Committee on February 17. Lawsuit lending is a problematic practice that the Alabama Court of Civil appeals has previously determined to be prohibited under Alabama law. In our opinion, this bill will now permit such loans, but very strictly limit and regulate the rate that can be charged.

SB234 (Orr) Racketeer Influenced and Corrupt Organizations (RICO):

ACJRC is also studying a bill being proposed by the state's District Attorneys that would create the Alabama RICO (Racketeer Influenced and Corrupt Organizations) Act. The measure is patterned after the federal RICO law which was passed to attack organized crime providing that racketeering is a criminal offense and allows for the recovery of three times the actual damages, punitive damages, and attorneys' fees. Unfortunately, RICO statutes are often now used to recover civil damages rather than attack organized crime.

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