VOLUME 24 NUMBER 8 – MAY 12, 2023

The Alabama Legislature reconvened its regular session on Tuesday, May 9th, 2023, working through the 19th and 20th legislative days.

Local Gas Tax Revenue Restrictions

On Tuesday, a bill that would limit the spending of local gas tax revenue to road and bridge construction and maintenance received unanimous approval from the Senate County and Municipal Committee. The current law only restricts the use of gas tax revenue collected at the state level, but not at the local level. HB 254, sponsored by Rep. Steve Clouse (R-Ozark), would impose similar restrictions on gas taxes charged by cities and counties. The bill now heads to the Senate for a final vote before being sent to the Governor’s desk for her signature. 

Bill to Further Clarify Aspects of the Sweet Home Alabama Tourism Investment Act

Following the successful passage of the Sweet Home Alabama Tourism Investment Act earlier in the session, a bill was introduced on Tuesday that would further clarify the start date for projects that would qualify for the new tourism incentives. HB 445, sponsored by Rep. Danny Garrett (R-Trussville), clarifies that the tax rebates for certified tourism destination projects are only available for projects placed into service after the effective date of the act. The bill has been referred to the House Ways & Means – Education committee.

Alabama House approves bill prohibiting discrimination on organ transplants

On Tuesday, the House took up a bill that would prohibit discrimination against people with disabilities who need organ transplants. Rep. Debbie Wood (R-Valley) serves as the sponsor of the bill and has previously introduced similar bills during other legislative sessions. HB 122 allows disabled individuals to bring a civil suit against healthcare providers, facilities, or organizations responsible for organ matching if they feel they have been discriminated against. The bill ultimately passed with a vote of 101-0, with one abstention, and later received 72 co-sponsors.

Entertainment Industry Incentive Amended to Include Music and Virtual Reality

A bill on Wednesday that would amend the previously existing Entertainment Industry Incentive Act of 2009, received a favorable report from the Ways and Means Education committee. Under existing law, the state’s credit is a rebate to production companies – 25% rebate is offered on expenditures incurred in Alabama, 35% of payroll to Alabama residents. The rebate is allowed to be used to offset Alabama income tax liability of the production company. If the amount of the rebate exceeds the production company’s Alabama income tax liability, then the excess will be refunded to the company.  HB 429, sponsored by Rep. Jamie Kiel (R-Russellville), would have increased the state’s film tax credit cap from its current $20 million to $65 million at the end of fiscal 2024, $110 million at the end of fiscal year 2025, and $150 million by the end of fiscal year 2026. However, the bill approved by the committee removed those increases, changed some definitions, and added music albums and virtual reality productions to what can qualify for a film tax credit. Rep. Kiel said he plans to revisit the cap amount at a later time. 

House Committee Approves Bill to Limit Who Can Conduct Background Check for Liquor License

On Wednesday, the House Public Safety and Homeland Security Committee approved HB 426, sponsored by Rep. Allen Treadaway (R-Morris), which would make the State Bureau of Investigations the sole entity that can run criminal background checks on Alcoholic Beverage Control Board license applicants. Current law allows applicants to submit fingerprints to a contracted entity as well, but the bill sponsor said the state does not contract with anyone. The bill now goes to the House floor for a vote. 

Public Hearing in House Committee on the 988 Crisis Call Line Funding Bill

In a public hearing on Wednesday, mental health officials advocated for funding of the 988 crisis call line, while many representatives from the telecommunication and wireless industry raised concerns regarding the cost being passed onto businesses and consumers. HB 389, sponsored by Rep. Rex Reyonlds (R-Huntsville), would fund the 988 crisis lifeline by imposing a new statewide surcharge on all landline, wireless, and other wireless voice communication services at a proposed rate of 98 cents per line per month. This rate would be the highest  rate in the nation. 

Many raised concerns during the hearing about imposing a new tax on citizens during a surplus budget year. In the past two years, over 30 states have proposed to either appropriate general fund revenue and utilize federal funds or study the issue further. Only five states have chosen to fund these services through a new tax on telephone bills. 

Chairman Reynolds mentioned a substitute that seeks to address some of the concerns that were brought to his attention, but it was not adopted in committee on Wednesday. As of this writing, the House Ways & Means – General Fund committee has not posted the bill on their agenda for next week. 

Anti-ESG Legislation Receives Favorable Report Out of Committee

A bill that would prohibit state contracts with businesses that boycott certain sectors of the economy based on environmental, social, and governance (ESG) policies was approved by the Senate Fiscal Responsibility and Economic Development Committee on Wednesday. A public hearing was originally called by Chairman Garlan Gudger (R-Cullman), but he ultimately canceled it due to a compromise among all parties. 

SB 261, sponsored by Sen. Dan Roberts (R-Mountain Brook), sets out particular sectors that cannot be “economically boycotted” by other companies who hope to contract with the state. The Business Council of Alabama, Regions, Protective Life Corporation, and others have been negotiating the bill with Sen. Roberts for over a week and finally came to an agreement on Wednesday. The substitute bill passed out of committee with a 10-3 vote along party lines.

The PRICE Act Advances Out of Senate Committee

One of numerous education reform bills this session recently advanced out of the Senate Finance and Taxation – Education committee. The Parental Rights in Children’s Education Act, also known as the PRICE Act, would allow parents of eligible students to receive money from the Education Trust Fund in the form of vouchers to be spent on alternatives to public schools, such as private, religious, or home schools. Under the proposed bill, parents of eligible students would receive a scholarship account to be used for tuition, fees, and other educational expenses at eligible schools. The amount of the scholarship would be equal to the state’s per-student funding amount for public schools, which is currently around $6,900 per student. 

SB 202 by Sen. Larry Stutts (R-Tuscumbia) was amended in committee to cap its impact on the Education Trust Fund from $576 million per year to $50 million per year in the first three years. There have been some opposing arguments from democratic members who say this could be harmful to the future of  public schools as more funding would be pushed to private schools. Sen. Arthur Orr (R-Decatur) and Sen. Larry Stutts both agree that there is still work to be done on this bill. 

House Passes Bill Addressing Requirements for Alternative Teacher Certification Programs

The House passed a bill on Thursday that would change requirements for alternative teacher certification organizations to operate in the state. HB 342, sponsored by Rep. Susan DuBose (R-Hoover), sets mandatory requirements for the programs to be approved. The requirements include successful operation in at least five states with no probation, evidence of certifying at least 10,000 teachers, successful operation for at least ten years, and a requirement that the applicant passes an exam aligned with Alabama standards of pedagogy and/ or subject area. An amendment was also added on the floor to require those receiving an alternative certificate to participate in the Alabama Teacher Mentorship Program.

Higher Ed has raised concerns over the legislation regarding maintaining a level playing field for in-state colleges and universities to compete with these out of state companies, but they did not oppose the bill. It ultimately passed with a vote of 83-20 and will now head to the Senate. 

Road Builder Liability Bill Passes Out of the Senate

On Thursday, the Senate approved a bill to offer more protections to road builders in Alabama from civil lawsuits. The original version of SB 159, sponsored by Senate Majority Leader Clay Scofield (R-Guntersville), said builders would not be liable for the condition of roads after they were turned over to the authority that contracted for them. The substitute bill approved by the Senate still holds contractors liable for certain circumstances such as a contractor’s failure to follow plans and specifications resulting in a “dangerous condition” or “latent defect” in the project. The substitute language also includes a provision stating that there is no presumed liability for a contractor or the body responsible for the road if the driver was distracted, driving more than 25 miles over the speed limit, or  intoxicated. Overall, the substitute bill attempts to strike a balance between holding contractors accountable for their work while also taking into account factors outside of their control that could contribute to accidents or other issues on the road. The substitute represents an agreement among road builders, trial lawyers, counties, and municipalities. It now goes to the House.

The Legislature will reconvene next Tuesday, May 12, 2023, for the 21st legislative day and is expected to work through three legislative days.