May 10, 2013

OMNIBUS GUN BILL ONE STEP CLOSER TO BECOMING LAW  


In the midst of a Senate Democratic filibuster on every bill, the Omnibus Gun bill, SB 286 by Sen. Scott Beason, R-Gardendale, moved one step closer to becoming law on Thursday after the Senate, by a vote of 25-5, adopted a conference committee report that made minor changes.  With one day left in the session, the bill will now go back to the House, which is expected to concur with the Senate, before being sent to the governor. As reported last week, the House of Representatives passed a compromise version of SB 286, handled by Rep. Ed Henry, R-Hartselle, which garnered support from sheriffs, district attorneys, the National Rifle Association and Alabama gun rights groups.  
 
Rather than concurring with the House changes, the Senate voted to non-concur and send the measure to a conference committee. The conference committee was comprised of three senators: Sen. Scott Beason, Sen. Paul Sanford and Sen. Roger Bedford, and three House members: Rep. Henry, Rep. Jack Williams, and Rep. David Colston. After some initial confusion over language dealing with public demonstrations, the committee quickly approved several technical changes to the law. The bill still contains language that mandates that employers cannot have a policy prohibiting employees from keeping firearms in their vehicles located on company property.  Language in the bill providing immunity to businesses from any civil action that is a result of an employee possessing a firearm on company property was preserved.    
 
In a recent article, the Associated Press accurately described BCA's consistent position on this issue:
 
"The civil immunity was a key victory for the Business Council of Alabama. But the organization, which was a key force in helping the GOP win control of the Legislature in 2010, nonetheless opposes the measure. BCA president and CEO William Canary has said throughout the session that businesses should be able to set their own policies for employees. Like the backers of the bill who cite the Second Amendment, BCA also justifies its position with the Constitution: the Fifth Amendment's protection of private property." Read the full AP story here.
 
Prior to the 2013 Legislative Session expecting this issue to come to the forefront, BCA presented three conditions that must be met in order for the BCA to support this bipartisan legislation: absolute immunity from civil liability for businesses; equal application to everyone in Alabama; and an opt-out provision. Two of these three have been accomplished but not the opt-out clause. Following the Senate's vote, BCA President and CEO William J. Canary said, "While we appreciate the significant efforts made to protect businesses from this government mandate as best as possible, this legislation falls short of our support."

In response to a question about where the business community goes from here, Canary offered the following response in an Montgomery Advertiser article:

"BCA was also critical of the parking lot provision, saying it encroached on private property rights. Bill Canary, the CEO and president of the BCA, said Thursday night the organization would weigh its future options. 'We now have to see what effect it's going to have on both the workplace and its full application around the state,' he said." Read the full Montgomery Advertiser article here.
TIPAC BILL IN POSITION TO PASS ON SESSION'S FINAL DAY

HB 227, the Transparency in Private Attorney Contracting (TIPAC) bill by Rep. Paul DeMarco, R-Homewood, is in position for final passage on Monday, May 20, the 30th and final day of the 2013 legislative session. After successful negotiations between BCA and the Alabama Association for Justice, this bipartisan legislation was poised for passage in the Senate Thursday night, but a Democratic filibuster that lasted until midnight derailed the effort.

On Tuesday, April 30, the BCA sent out "Action Alerts" to its membership asking them to contact their state senator:


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For the last two years, the BCA has been at the forefront of the effort to require state agencies to make a written declaration that hiring outside counsel on a contingency fee basis is cost effective and in the public's best interest.

As state attorneys general become more engaged in major consumer protection issues, there has been a willingness on the part of some state attorneys general to hire trial lawyer firms to pursue litigation on behalf of the state.  As payment, these attorneys receive a contingency fee, which is a percentage of whatever amount is recovered on behalf of the taxpayer.  In the past, some private law firms received excessively high fees in relation to the amount of work they did on behalf of the state.  In addition to excessive fees, there is a substantial risk of "pay to play" schemes that may appear when political contributions from plaintiffs firms are traded for contingent fee contracts.

It should be noted that Alabama Attorney General Luther Strange has been a model of transparency and accountability during his time in office and has not engaged in the type of private attorney contracting as stated above.

HB 227, known as TIPAC (Transparency in Private Attorney Contracting), will come up tomorrow for a vote in the Senate Governmental Affairs Committee.  Please call your state senator (and any senator with which you share a personal relationship) today to ask them to vote yes on HB 227, and explain that we need to be protecting taxpayers from frivolous legal fees.

With bipartisan support, HB 227 passed the House 69-26 on April 16.  As you may recall from your February 22 Capital Briefing, former U.S. Representative and Florida Attorney General Bill McCollum visited Montgomery on February 20 to testify at a public hearing before a joint House and Senate Judiciary Committee meeting in support of HB 227, explaining that TIPAC legislation has already been introduced in more than a dozen state legislatures and successfully implemented in states like Florida, Indiana, and Mississippi.

You can read more about McCollum's visit to Montgomery on our BCA Blog.
 
To easily contact your legislator, download BCA's app, BCA Connect, from the iTunes App Store. It is available for free on iPhone and iPad platforms.

If you have any questions or need additional information, please contact either of us or any member of our advocacy team.

Thank you for your ongoing commitment to improving Alabama and for your continued leadership with BCA.
 
Sincerely,
 
William J. Canary
President and CEO
 
Anita Archie
Senior Vice President for Intergovernmental Affairs and Advocacy / Legal Advisor


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MEDICAID OVERHAUL MEASURE GOES TO GOVERNOR BENTLEY

The House on Tuesday passed the Senate's Medicaid overhaul bill and sent it to Governor Robert Bentley. The House voted 98-0 to pass SB 340. Since the bill, sponsored by Sen. Greg Reed, R-Jasper, passed the House unchanged, it went to Bentley, whose office received it on Wednesday. Bentley last year established a Medicaid Advisory Commission to recommend ways to fix Medicaid.

With SB 340 lawmakers hope to reduce the need for ever-increasing state appropriations to the combined state-federal Medicaid program and provide better health outcomes for patients.

Medicaid, primarily funded by federal appropriations, has been requiring more and more state matching dollars. The General Fund appropriated some $630 million to Medicaid this year, about one-third of the entire $1.7-billion General Fund.

Medicaid, which Bentley says is financially unsustainable, is a fee-for-service system that pays for each patient visit. Alabama has some 940,000 Medicaid recipients but another 200,000 to 300,000 may be eligible.

Rep. Jim McClendon, R-Springville, who handled SB 340 in the House, believes that a new Medicaid program will save taxpayers money and result in healthier patients. "The cost continues to take a larger amount of the General Fund budget and is not in a position to even consider expanding," McClendon said.

The Business Council of Alabama supports reform of the state's Medicaid program to control costs and ensure long-term sustainability by improving efficiency, addressing fraud and abuse, and ensuring access to quality health care for the citizens of Alabama.

If the bill becomes law, the Medicaid Agency will be required to create an unspecified number of regional care organizations where medical providers will serve recipients for a set fee. The service regions will have to be in place by Oct. 1. Other deadlines exist before scheduled full program implementation by Oct. 1, 2016.

Reed, McClendon, and State Health Officer Dr. Don Williamson effectively have explained the bill's ramifications. Williamson said a new Medicaid program could save $50 million to $75 million state dollars over five years.

There was no House opposition. "You've convinced me the outcome will be better for the patient than the current system," Rep. John Knight, D-Montgomery, said prior to the vote on the bill. "We will have to constantly evaluate the outcome."

McClendon said the new system will not reduce service and should eliminate many expensive emergency room visits. "This helps them choose the right entry into the health care system appropriate to their needs," McClendon said on the House floor.

The Senate on Thursday passed associated Medicaid overhaul bills. The Senate passed HB 562 sponsored by Rep. Steve Clouse, R-Ozark, 26-7. It would extend the nursing home Medicaid assessment and monthly surcharge for two years.

The Senate then passed the second Medicaid overhaul associated bill, HB 602, also by Clouse, on a vote of 26-0. It would extend the hospital Medicaid assessment for three fiscal years but would allow for a change after two years if Congress makes changes.

Both bills go to Bentley for consideration.

Democrats used their discussion time to promote Medicaid expansion, which Bentley said he won't do under Medicaid's current configuration. "I hope we don't lead the nation as the last state to accept Medicaid," Sen. Roger Bedford, D-Russellville, said.

Two other Medicaid-associated bills, HBs 370 and 371 by Rep. Greg Wren, R-Montgomery, passed the House but were not assigned to Senate committees. HB 370 would have capped the amount of General Fund dollars appropriated to the Medicaid Agency. HB 371 would have authorized the Medicaid Agency to seek a waiver from the Centers for Medicare and Medicaid Services to increase Medicaid recipient co-payments on Medicaid health care services.
HOUSE & SENATE AGREE TO EDUCATION BUDGET WITH 2 PERCENT COLA FOR K-12 EDUCATORS; $9.4-MILLION INCREASE FOR PRE-K

The Alabama Senate tabled the version of the education budget, HB 166, by Rep. Jay Love, R-Montgomery, that was favorably reported from the Senate Finance & Taxation-Education Committee and began debating a floor substitute offered by Sen. Arthur Orr, R-Decatur. The floor substitute, as well as the House-passed version, contained a 2-percent pay raise for K-12 educators. The Senate committee had earlier approved a version containing a 1-percent pay increase and a conditional 1-percent bonus that would be released if the funding becomes available. After the Senate passed the bill on Tuesday night by a vote of 22-11, the House on Thursday voted 70-26 to accept the changes made by the Senate, thereby avoiding the necessity of a conference committee, allowing the bill to be transmitted directly to the governor.

 

A broad coalition of supporters including the Alabama school readiness alliance and the BCA advocated for a $12.5-million increase for Alabama's First Class Pre-K  program. This increase was supported by Governor Bentley and approved in the House version. The Senate committee version reduced this amount to $6 million. The compromised budget resulted in a final increase of $9.4 million, which will allow 1,500 more 4-year-old children access to Alabama's high quality voluntary Pre-K. 


The final version leaves $40 million un-appropriated as a reserve to offset the negative impacts on Education Trust Fund revenue of the federal sequester and of the tax credits provided for under the Alabama Accountability Act. The House-passed version left a reserve of $66 million. The House and Senate agreed in the final version on a direct payment of $35 million to go towards repayment of some $437 million borrowed from the rainy day account during recent years of budget proration, while the governor had recommended a direct payment of $100 million.

 

The following table compares funding recommendations for several agencies and programs:  

 


Budgeted



FY 2013 
Gov. Rec.



FY 2014
House
Passed



FY 2014
Sen. Pass & House
Concurs


FY 2014
Dept. of Children's Affairs




Office of School Readiness - 1st Class Pre-K
19.1
31.6
31.6
28.5
Dept. of Commerce - Operations
& Main
4.7
4.7
4.7
4.7
AIDT
5.5
5.5
5.5
5.5
Workforce Development -
career center & Existing training
commitments
38.7
41.4
41.4
41.4
K-12 Found. Prog. includes
raises
3634.6
3735.1
3715.2
3732.3
Two-Year College System
(Total)

316.1
319.3
320.1
324.0
Adult education
13.4
13.4
12.4
12.4
Workforce Development
2.7
2.5
2.7
2.9
AL Technology Network (ATN)
4.6
4.6
4.6
4.6
AL Dept. of Education




AMSTI - Math, Science
Tech Initiative
28
28
28
28
AL Reading Initiative
58.1
48.1
48.1
48.1
Distance Learning
18.5
18.5
18.5
18.5
Advanced Placement
2.2
2.2
2.2
3.8
Liability Insurance
---
---
5
5
Career Tech Initiative
2.3
2.3
2.3
2.3
Colleges and Universities
(Total)

1006.3
1025.9
1020.8
1024.0
Alabama Innovation Fund
1.65
10
6.1
3.4
Repayment to ETF
Rainy Day Account
----
100
35
35

HOUSE & SENATE AGREE TO CLARIFICATIONS FOR THE IMPLEMENTATION OF THE ALABAMA ACCOUNTABILITY ACT

The Alabama Senate invoked cloture ending a contentious debate to pass a substitute version of HB 658, by Rep. Jim Carns, R-Vestavia Hills, to amend the Alabama Accountability Act, on a vote of 21-12. The substitute bill was sponsored by Senate President Pro Tem Del Marsh, R-Anniston, to clarify the definitions and further outline the qualifications and procedures for facilitating the transfer of students from failing schools to non-failing schools and the implementation of related income tax credits.

 

The Marsh substitute clarifies that : 1) no public or nonpublic school is required to enroll any student; 2) the parents of a student who is either enrolled or assigned to attend a failing school will qualify for the tax credit; 3) a "failing school" is defined as one that is persistently low-performing, does not exclusively serve a special population of students, and has rated in the bottom 6 percent on the state standardized assessment in reading and math for three or more times in the last six years; 4) the student seeking a transfer from a failing school shall first attempt to enroll in a non-failing public school within the same school system; and 5) scholarship-granting organizations must award scholarships to low-income eligible students at a percentage that is equal to the percentage of low -income eligible students in the county where the majority of their scholarships are awarded. The bill also specifies that the tax credit to scholarship donors shall equal 100 percent of the contributions (originally 50 percent in Accountability Act) made to a scholarship-granting organization and that donors may not specifically designate scholarship recipients. The aggregate cap of the income tax credit for donations made to scholarship-granting organizations shall not exceed $25 million annually.

 

Later in the day, the Alabama House accepted the changes made by the Senate to HB 658 on a vote of 61-41, allowing the bill to be transmitted to the governor.

CAMPAIGN CONTRIBUTION BILL FOR CORPORATIONS PASSES

The House on Thursday passed SB 445 that would remove the $500 political campaign contribution cap for corporations. SB 445 sponsored by Sen. Bryan Taylor, R-Prattville, would repeal the $500 cap and allow unlimited contributions by businesses just as individuals have been allowed.

Businesses can contribute to political action committees but face a $500 limit for a direct contribution to a candidate. Rep. Mike Ball, R-Madison, said the corporate contribution cap is a "pretend cap" that has no effect. "It's stupid. It's just stupid," al.com quoted Ball as saying.

The attorney general in 1989 said that corporations could give $500 for each election in the state during any one year. According to al.com, the limit was more than $10,000 in 2006 that had 21 elections.

The National Conference of State Legislatures in 2011 said that only Missouri, Oregon, Utah and Virginia, had no limits on contributions. Ball said he thought the change could lead to greater transparency because corporations could give directly to candidates instead of pumping money into PACs, al.com reported.

The House passed the bill 68-33 largely along partisan lines; one Republican voted against it, and several Democrats voted for it. The Senate bill was changed in the House, so it must be returned to the Senate for consideration. One day remains in the 2013 legislative session, May 20.
TIMELY PAYMENT BILL CAN PASS BUT TIME IS SHORT

The Senate prompt-payment bill is on the House calendar and can pass even with the 2013 regular legislative session winding down. The House Committee on Transportation, Utilities and Infrastructure on a voice vote Tuesday approved SB 237 sponsored by Senate President Pro Tem Del Marsh, R-Anniston.

SB 237 would require public agencies to quickly pay invoices submitted by contractors on most public works projects, hence the unofficial name as the prompt-payment bill. The Senate previously passed the bill 30-0 with one abstention. The last day of the 2013 legislative session is May 20.

If the bill becomes law, an invoice for a public works job would have to be forwarded for payment no later than 10 days after receipt. The contracting agency would then have 35 days to pay the invoice. Alabama Department of Transportation public road and bridge projects and Alabama Building Commission contracts would be excluded from the payment time limit.

Rep. Bill Roberts, R-Jasper, said some government agencies aren't paying small contractors quickly enough. "It's not good for small contractors to be funding the state and counties," said Roberts, who had sponsored the House version.

The bill waives the 45-day requirement if funds to pay an invoice aren't available until after a project's completion. Requests for proposals would have to state that funds wouldn't be available until after a project's completion. With that information, contractors could decide whether to waive the right to speedy payment and bid on a project.
DEMARCO TAX EXEMPTION BILL PASSES

The House on Thursday concurred with Senate changes to HB 419 that would allow sales and use tax exemptions for certain purchases by contractors working on projects for most governmental entities. The House voted 96-0 to concur with Senate changes to the bill sponsored by Rep. Paul DeMarco, R-Homewood. The bill goes to Governor Robert Bentley for consideration.

The Department of Revenue will have to issue certificates of tax exemption from state and local sales and use taxes on building materials, construction materials and supplies, and other tangible personal property used on government building projects. If the bill becomes law, it would take effect on Jan. 1.
TAXPAYER BILL OF RIGHTS STILL NOT LAW

For three consecutive years, the bill known as the Taxpayer Bill of Rights II (TBOR II) has sailed through at least one house only to see this pro-business legislation get caught up in the political fray each year.  In 2012, TBOR II was passed by the legislature, only to be pocket vetoed by Governor Bentley due to a technical error made in the transmitting process. Earlier this year, the House of Representatives passed HB 264 by Rep. Paul DeMarco, R-Homewood, with overwhelming bipartisan support 96-2, but since that time, the bill has lingered in the Senate despite no real opposition to the measure.

On Tuesday, May 7, the BCA sent out "Action Alerts" to its membership asking them to contact their state senator:


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Please contact your state senator (and any state senator with which you share a personal relationship) today to ask them to place HB 264 by Rep. Paul DeMarco on the special order calendar. HB 264 is the Taxpayer Bill of Rights II and this will be the last opportunity in the 2013 legislative session for it to be considered.
 
The bill provides for an independent Alabama tax appeals commission, separate from the Alabama Department of Revenue. It also updates and conforms to federal law several provisions of Alabama Taxpayers' Bill of Rights to promote tax fairness and compliance.
 
There is cautious optimism for the bill's enactment this year, with this year's effort having the direct input and expressions of support from Governor Bentley. This year's bill provides that the governor will select judges for the tax appeals commission from a list of qualified candidates vetted by a seven-member nominating committee. The judge would then be sworn in, as there is no requirement for Senate confirmation.
 
The BCA and several other business and trade associations under the Business Associations Tax Commission (BATC) support this legislation.
 
To easily contact your legislator, download BCA's app, BCA Connect, from the iTunes App Store. It is available for free on iPhone and iPad platforms.

If you have any questions or need additional information, please contact either of us or any member of our advocacy team.

Thank you for your ongoing commitment to improving Alabama and for your continued leadership with BCA.
 
Sincerely,
 
William J. Canary
President and CEO
 
Anita Archie
Senior Vice President for Intergovernmental Affairs and Advocacy / Legal Advisor


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Despite these efforts and the efforts of many other business groups associated with the Business Associations Tax Coalition (BATC), HB 264 is still pending in the Senate with only one day left.

BCA will continue to advocate for passage of HB 264 before the end of this legislative session.
TAX CREDITS FOR THE RESTORATION OF HISTORIC STRUCTURES AWAITS THE GOVERNOR'S SIGNATURE

On Thursday, the Alabama House accepted the Senate's changes to HB 140, by Rep. Victor Gaston, R-Mobile, paving the way for the transmittal of the bill to the governor. The bill provides a tax credit of 25 percent of the qualified rehabilitation expenditures that improve "certified historic structures" and it provides a tax credit of 10 percent of the qualified rehabilitation expenditures made to improve "qualified pre-1936 non-historic structures, against the state income tax or the state's share of the financial institutions excise tax. The aggregate annual cap of all credits allowed for historic structures shall not exceed $20 million, previously $30 million as passed the House. The credits are not available for the rehabilitation of structures based on plans submitted three years after enactment. With this legislation, Alabama would join 31 other states that have established tax credits for the preservation of historic structures. Supporters of this legislation credit it for promoting the restoration of communities and job growth in those states.

 

The BCA supports this legislation.

SESSION HAS ONE DAY LEFT FOR SPACE PORT LEGISLATION

Time is running out in the 2013 legislative session for legislation that could put Alabama in the running for a space port - an airport for space vehicles.

The House Technology and Research Committee on a voice vote Wednesday favorably reported SB 378 sponsored by Sen. Gerald Dial, R-Lineville. It is on the House calendar for the last legislative day, May 20.

SB 378 would create the Alabama Space Port Authority. Its purpose is to promote research and development of new space exploration and spaceport technologies, and sponsor events that promote aerospace and aviation and related industries, the bill's title said.

Rep. Mac McCutcheon, R-Monrovia, handled Dial's bill in the House committee. McCutcheon said the legislation is required in order for the state to seek federal funds to begin studying the feasibility of a space port. The authority would be part of the Alabama Department of Economic and Community Affairs.

"With Alabama having the technology and being a space leader, we feel we are in line for this," McCutcheon said. Up to 19 spaceports are planned nationally.

Huntsville's Marshall Space Flight Center, a National Aeronautics and Space Administration facility, is the United States' rocket development and testing center.

Committee members asked McCutcheon for assurance that space port authority activity would not encumber Alabama with debt. McCutcheon said the debt would be corporate debt, not the state's.
ENVIRONMENTAL UPDATE
The General Fund Budget, SB 143 by Sen. Arthur Orr, R-Decatur was referred to a conference committee that forged a compromise version of the budget that was adopted by both the House and Senate on Thursday. The budget is now in possession of the governor awaiting his signature. There are two areas in the budget that have been of particular interest for members of the BCA Environmental and Energy Committee: 1) sufficient funding for the Alabama Department of Environmental Management (ADEM) and 2) the potential statewide water assessment program.
BCA supports adequate funding for ADEM so that the Department may provide experienced personnel to carry out necessary services without wasteful overlap of programs. Unfortunately, the final version of the bill only included $1,008,048 in funding from the General Fund for the department. This funding included a direct appropriation of $830,000 from the general fund and a $178,048 transfer from the steel dust fees collected by the state. From the Department's direct appropriation, $380,000 is earmarked for use in the CAFO (Concentrated Animal Feeding Operation) program.
 
Director Lance LeFleur has stated that ADEM will seek a permit fee increase to fill the void caused by the inadequate General Fund appropriation. The public comment period associated with a proposed 50 percent across-the-board permit fee closed this Monday. On behalf of its members, BCA submitted comments to ADEM. In the comments, ADEM was asked to expand the use of General Permits for programs such as non-metallic mineral mining. Also, the Department was asked to look closely at each individual permitting program and to consider streamlining voluntary programs, such as Brownfield redevelopment as an alternative to hold off the fee increases, and to not impose a disincentive that slows  economic growth.
 
In the area of administrative appeals, the Department was asked to look at some of the practices of its sister agencies, such as the Surface Mining Commission, to develop alternatives for covering these very costly activities. Public hearings associated with draft permits present a significant cost for permit applicants and the Department. Currently, the Department's costs are covered by an additional fee charged to the applicant, even though it is usually a third party requesting the public hearing. ADEM was asked to consider charging the public hearing fee to the party requesting the hearing and to tighten its discretionary policy regarding when a public hearing is held.
 
Lastly, BCA offered to lead an effort to facilitate a conversation between the regulated community and the Department to explore ways to make the permitting process more efficient.
On the subject of water resources, the BCA has supported agencies collecting the appropriate data needed to assist the State in making informed decisions regarding water policy in Alabama. The budget transmitted to the governor includes a $1 million appropriation to the Geological Survey of Alabama to be expended in coordination with the Office of Water Resources to support the state water assessment program.
YOUR BCA ADVOCACY TEAM
Anita L. Archie
Senior Vice President
and Legal Advisor,
Intergovernmental Affairs,
and Advocacy
[email protected]
334.240.8775
Dana Beyerle
Manager of Communications
[email protected]
334.240.8768
William J. Canary
President and CEO
 [email protected]
334.240.8714
Mark Colson
Chief of Staff and
Executive Director, ProgressPAC
 [email protected]
334.240.8724
Nancy Wall Hewston
Vice President for
Communications, Strategic Information and
Federal Affairs
[email protected]
334.240.8725
Nathan Lindsay
Director of
Political Affairs and
Regional Operations
[email protected]
334.240.8766
Victor Vernon
Vice President for
Public Policy  
[email protected]
334.240.8722
Joshua Vaughn
Manager of Visual
Communications and
Strategic Information
 [email protected]
334.240.8740
Pam Ware
Manager of Intergovernmental Affairs, and Advocacy
[email protected]
334.240.8719

For more information on the Business Council of Alabama
contact Elaine Fincannon at [email protected]
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