2015 Legislative Session Full of Successes for GUMBO
Tourism Incentives Remain Intact Despite Effort to Eliminate Them
As originally drafted, HB 58 by Rep. Alan Baker (R – Brewton), legislation offered as part of the Governor’s Made in Alabama economic development incentives package, would have eliminated the incentives available for large tourism destination projects that locate in Alabama.
The bill was designed to overhaul the way Alabama offers tax incentives to companies that locate within the state. In doing so, however, the legislation as originally written would have eliminated the tourism tax incentives proposed by GUMBO and unanimously approved by the legislature in 2013.
Working with the sponsor and Economic Development and Tourism Committee Chairman, Rep. Alan Harper (R – Northport), GUMBO’s lobbyists drafted language that was offered as a committee amendment to include the tourism destination project tax incentives back into the bill.
The legislation, known as the Alabama Jobs Act and signed into law by the Governor, provides eligible companies a jobs credit of three percent of the previous year’s wages paid to new employees for a period of 10 years. It also provides an investment credit of 1.5 percent of a company’s investment into the construction, equipment, or development of an eligible project that creates new jobs.
The tourism incentives apply to commercial enterprises open at least 120 days a year, which are designed to attract people to the state due to the project’s inherent cultural value, historical significance, natural or man-made beauty, entertainment, or amusement opportunities.
The bill passed the House unanimously and received only one dissenting vote from Sen. Trip Pittman (R – Montrose) in the Senate.
Department of Tourism Remains Cabinet Level Agency
Rumors began circulating during the legislative session that legislative leadership and the Governor’s office were looking into consolidating the Department of Tourism under the umbrella of the Department of Commerce. Immediately upon hearing the rumors, GUMBO’s lobbyists reached out the Speaker of the House’s Chief of Staff, the Governor’s office, and the Senate President Pro Tem’s Chief of Staff to voice GUMBO’s opposition to the consolidation effort. Several leaders within the tourism industry also reached out to the their legislators to voice opposition.
Due to the overwhelming opposition from the tourism industry, the Governor backed off of his proposal to consolidate the Department of Tourism and the agency will remain a cabinet level agency.
The Department of Tourism is important to GUMBO and the tourism industry because it serves as the chief marketer of the state’s great natural resources, such as the Gulf of Mexico, and other tourism destination locations throughout the state. Tourism is a huge economic engine for the state and the Department of Tourism does an excellent job promoting all the state has to offer.
Ultimately, the consolidation legislation only included the Department of Economic and Community Affairs (ADECA) and the Department of Postsecondary Education, which were absorbed into the Department of Commerce.
Gulf State Park Financing Legislation Runs Out of Time
HB 586 by Rep. Steve McMillan (R – Gulf Shores) would have authorized the incorporation of the Gulf State Park Improvements Financing Authority.
The bill would have authorized the authority to sell and issue up to $50 million in bonds for the purpose of providing the funds necessary to construct and equip capital improvements at Gulf State Park.
Despite a valiant effort, the bill ran out of time during the legislative session before it received final passage. It passed the House of Representatives unanimously and received a favorable report from the Senate Governmental Affairs Committee. Due to mounting opposition from Sen. Paul Sanford (R – Huntsville) and Sen. Arthur Orr (R – Decatur), however, the bill was never brought to the full Senate for a vote.
GUMBO is actively working to encourage Governor Bentley to include this important legislation in the call for a Special Session, which will likely occur in August.