Capitol Retail Report

Friday, Feb. 5, 2016

Early Spring, Early Budgets
and Other Groundhog Predictions

The Alabama Legislature, which opened its 2016 regular session on Groundhog Day, hopes to get its budgeting duties right this year. Like the groundhog’s early spring prediction, legislative leaders project both state budgets will reach the floor before the Legislature’s spring break at the end of March. Here’s hoping both predictions prove true. Otherwise, as occurred in 2015, it could be déjà vu all over again with multiple special sessions to work out the state’s budgeting woes.

So far, no one is talking taxes. The governor proposes moving $181 million from the education budget (HB117) to the General Fund (HB104) to balance the budgets. His idea for paying for an up-to-$800-million plan to close most of the state’s 16 state prisons and build four big, new ones: savings from no longer having to maintain dilapidated prisons. And the governor is calling for 2 percent pay raises for all state employees, “no strings attached.”

Alabama’s Medicaid Agency, is asking for $157 million more than its current budget, and the governor’s budget only calls for a $100 million increase.

Legislative leaders are talking cuts and prioritization to make ends meet.

>> Learn about Alabama’s current financial condition

Both political parties have introduced lottery legislation: HB10 Rep. Craig Ford, D-Gadsden, and HB13 by Rep. Alan Harper, R-Aliceville / SB19 by Sen. Jim McClendon, R-Springville.

Whatever plan lawmakers advance, each Friday, your Alabama Retail Association will provide a summary of the legislative action for that week so retailers stay informed about state policies that could impact your bottom line. We urge you to provide feedback to your legislators and your association on the legislation included in this and future issues of Capitol Retail Report. Talking to legislators and your association helps ensure the voice of retail is heard when public policy is made. We are better together.

>> Questions about how to make retail heard in the 2016 session?
Alabama Retail Vice President Alison Hosp has answers

TAX ISSUES

Tuesday’s House Agenda to Include Expansion
of Small Business Tax Breaks for Creating Jobs

As Alabama House Speaker Mike Hubbard, R-Auburn, predicted early this week, Republican-backed legislation to create another tax credit for small businesses that create jobs is moving quickly through the House. The Commerce and Small Business Committee on Wednesday approved HB36, or the Alabama Small Business Jobs Act, by Rep. Kyle South, R-Fayette. It could be debated on the House floor as early as Tuesday.

South’s bill provides a one-time, $1,500 income tax credit to Alabama businesses with 75 or fewer employees, for each qualified, new, full-time, Alabama resident employee hired. It allows for an additional $1,000 income tax credit (for a total of $2,500) if the new employee hired is a recently returned, unemployed veteran as part of the Heroes for Hire Act passed in 2012. To qualify for the credit, businesses must retain the new employee for 12 consecutive months, and the employee must make $40,000 or more annually. In addition, businesses must show a net employee growth each year to qualify for the credit.

“Other tax credits are not being taken advantage of,” Hubbard said. The legislation encourages the Alabama Revenue Department “to market and promote the credits to folks that it might affect,” said South. Under the legislation, employers would be able to claim the Small Business Jobs Act credit or a similar credit created under the Full Employment Act of 2011. The 2011 law provides a $1,000 credit to small businesses (50 or fewer employees) for creating new jobs paying more than $10 per hour.

Another employment tax credit bill has been introduced. SB90 by Sen. Arthur Orr, R-Decatur, would provide a $1,000 income tax credit to an employer for each qualified apprentice employed. It awaits action by the Senate Finance and Taxation Education Committee.

Panel Approves Gubernatorial
Appointment of Taxpayer Advocate

The House State Government Committee on Wednesday approved HB38 by Rep. Mark Tuggle, R-Alexander City, which requires Alabama’s Taxpayer Advocate to be appointed by the governor, rather than by the Alabama revenue commissioner. The bill now goes to the full House for consideration.

Johnson Proposes Exempting Prescription
Drug Costs from Business License Taxes

As he has in several past sessions, Rep. Ron Johnson, R-Sylacauga, has introduced legislation to exempt prescription drug costs from business license taxes based on gross receipts. HB58 awaits action by the House Ways and Means General Fund Committee.

Bill Requires Counties to Hire Outside Counsel
for Property Tax Assessment Appeals

HB50 by Rep. Paul Lee, R-Dothan, would require county commissions to hire outside legal counsel for the state and counties when property tax assessments are appealed to a circuit court. Right now, the district attorney represents the state and counties in property tax assessment appeals. The bill awaits action by the House County and Municipal Government Committee.

LABOR

House to Consider Right-to-Work
Constitutional Amendment

Voters would decide if Alabama’s right-to-work law should be part of the Alabama Constitution under legislation the full House could consider as early as Tuesday. After a public hearing Wednesday, the House Constitution Campaigns and Elections Committee approved a substitute version of HB37 by Rep. Arnold Mooney, R-Birmingham. The sponsor said the weight of the state constitution needs to be behind the 1953 law, which states Alabamians have the right to work without their membership or lack of membership in a labor union being a condition of employment. “Just a law does not protect that core value,” Mooney told the committee. Currently, 10 of the 25 states with right-to-work laws have the provision as part of their constitution, according to the National Conference of State Legislatures. The Senate companion is SB111 by Sen. Gerald Dial, R-Lineville.

MINIMUM WAGE

Melton Introduces Two Plans
for a State Minimum Wage

Rep. Darrio Melton, D-Selma, has introduced two minimum wage bills:

HB70 would create a state minimum wage of $10.10 per hour in three steps ending Jan. 1, 2018. Starting Jan. 1, 2020, the state minimum wage would increase every three years based on the Consumer Price Index for the preceding July 1.
HB71 would start the state minimum wage at the federal minimum, but would increase Alabama’s minimum wage each year based on the percentage increase in the Consumer Price Index in the previous calendar year.

Both bills have been assigned to the House State Government Committee. Alabama currently has no state minimum wage. The state adheres to the federal minimum wage.

ELECTIONS

Newest House Member Sworn In;
Another Vacancy to Be Filled Feb. 16

“I will work every day, together with you, to make the state of Alabama better than the day before,” Alabama’s newest House member said on the House floor Tuesday after being sworn in as the newly elected representative of House District 80. Rep. Chris Blackshear, R-Phenix City, replaces the late Lesley Vance, who died Nov. 3 after an extended illness. Vance served the district for 21 years. Blackshear, who was supported by the Alabama Retail Association, was elected with 63 percent of the vote in a Jan. 19 special election.

Rep. Dan Williams died in July after a battle with leukemia, creating a vacancy in House District 5. The Alabama Retail Association endorses Danny Crawford of Athens in the Feb. 16 special General Election to fill that seat.

ALCOHOL

Alcohol Study Commission Proposes Three Bills;
Privatization Task Force Brings No Bill

In January, the Alabama Alcoholic Beverage Study Commission, which lawmakers set up in its 2015 regular session, recommended the Alabama Legislature allow greater retail opportunities for breweries, brewpubs, wineries and distilleries. The commission said it would divide its recommendations into three bills affecting:

BEER – So far, no legislation has been introduced based on the commission’s beer recommendation, which is to allow small brewers and brewpubs producing less than 60,000 barrels of beer annually to sell up to 288 ounces of draft or package beer, in any packaging including bottles, cans or growlers, directly to consumers. That limit is per consumer per day for off-premise consumption only. It equates to roughly a case of beer to a customer per day. The commission also recommends brewers be allowed to directly deliver up to two kegs per event to charity functions.
SPIRITS – SB132 by Sen. Bobby Singleton, D-Greensboro, and Sen. Paul Sanford, R-Huntsville, the commission’s Senate co-chairman, and the House companion, HB46 by Rep. Alan Boothe, R-Troy, would allow a licensed distillery to make retail sales from its premises of up to 750 milliliters, a standard-size bottle, per customer per year, only for off-premise consumption. It awaits action by the Senate Fiscal Responsibility and Economic Development Committee.
WINE – HB83 by Rep. David Faulkner, R-Birmingham, and Rep. Alan Harper, R-Aliceville, the commission’s House co-chairman, would allow a licensed winery to obtain a permit to operate one additional tasting room outside its on-site tasting room. It has been assigned to House Economic Development and Tourism Committee.

Boothe, the chairman of the Alcohol Beverage Reform Task Force, which this summer and fall studied the possibility of privatizing state liquor sales, told House members Tuesday that the task force had no action to recommend at this time.

An alcohol bill that was introduced this week,SB102 by Sen. Tom Whatley, R-Auburn, would allow alcohol beverage licenses to be transferred without an additional fee, reapplication or reinspection, if the local governing body agrees to the move. The bill has been assigned to the Senate Governmental Affairs Committee.

OTHER INTRODUCTIONS

SB113 by Sen. Cam Ward, R-Alabaster, would lengthen the timing for bringing a deceptive trade practice action from one year to four years from the alleged Deceptive Trade Practices Act violation or practice. It awaits action by the Senate Judiciary Committee.

SB96 by Sen. Dick Brewbaker, R-Montgomery, would specify that a municipality or public industrial authority may abate county taxes for economic development purposes only if the corresponding municipal tax is abated and the abatement is limited to the same rate of taxation as the corresponding municipal tax. It has been assigned to the Senate Fiscal Responsibility and Economic Development Committee.

SB14 by Sen. Gerald Allen, R-Tuscaloosa, among other provisions, would allow owners to carry their pistols without a license on their own property, vehicle, home or business or on the property or in the vehicle of another owner with their consent. It awaits action by the Senate Judiciary Committee.

NEXT LEGISLATIVE DAY

The Alabama House of Representatives will convene at 1 p.m. Tuesday, Feb. 9, for the third legislative day of the Alabama Legislature’s 2016 regular session. The Alabama Senate will convene at 2 p.m.

FEDERAL

Congress Can Stop ADA Lawsuit Abuse;
Contact Your Congressman

Retailers want customers with disabilities to move freely within and outside their business. What you and other Alabama retailers don’t want is to be harassed by a lawyer trying to extort huge legal fees from you with no real interest in ensuring your store or restaurant is accessible.

Legislation pending in Congress would stop lawyers who thrive by threatening Americans with Disabilities Act (ADA) access lawsuits. The ADA Education and Reform Act of 2015 (H.R. 3765) by Rep. Ted Poe, R-Texas, would give businesses 120 days to remedy any alleged ADA infractions before being saddled with legal fees.

“This is a commonsense reform that is long overdue,” said U.S. Rep. Bradley Byrne, who has already signed on as a co-sponsor of the legislation.

If you haven’t already, email through links below or call your congressional representative today and ask them to become a co-sponsor of H.R.3765 to ensure money spent improves access and doesn’t line the pockets of attorneys.

(You will need your zip code+4 to contact
members of Congress via email)

If you have experienced the threat of one of these lawsuits firsthand, be sure to share your story with your congressman. Your personal experience will do more to convince them to co-sponsor the legislation than a call from a member of the Alabama Retail Association staff.

For more on this issue, go here.