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Inside Alabama Politics – February 8, 2021

How goes the session

By TODD STACY, Alabama Daily News

The Alabama Legislature met last week for the first time since May 2020. In normal times, that wouldn’t be strange at all. Most years all that is required of the Legislature is to meet for their constitutionally-prescribed annual Regular Session. What makes it strange this year is the sheer amount of bills and issues that were left unresolved after last year’s COVID-shortened session.

Between March 13, when the House and Senate broke for Spring Break, and May 5, when they reconvened to pass budget bills, the Legislature only met once on March 31, and only to extend the “date certain” when they had to meet again.

Before the coronavirus, the 2020 session was like most others in that lawmakers were taking their time with the big issues, including the budgets, waiting to handle them in the last half of the session. That last half never came, meaning a lot of important legislation never got considered. At the time, most weren’t worried because it was conventional wisdom that the governor would call one or more special sessions when the COVID coast was clearer and all would be taken care of. It is at once amusing and heartbreaking to think of how, back a year ago, most thought the coronavirus pandemic would be over by the fall. The coast never truly cleared and, for myriad reasons we’ve discussed in IAP for months, there were never any special sessions called.

Now, the Legislature has picked up where it left off, with lots of work to do.  The mood in the State House right now could be described as cautious determination. The social distancing protocols are making normal legislative tasks complicated, while frustrating lawmakers, staff, lobbyists and the reporters who cover it all. Yet, the House and Senate are determined to get essential business done in short order, understanding that a COVID-19 outbreak in the State House could shut down the session at any time.

Alabama’s constitution calls for a Regular Session of the Alabama Legislature to last no more than 30 legislative days within 105 calendar days. The House and Senate used three legislative days last week, meaning they have 27 more to use before May 17. Days when only committees meet don’t count as legislative days, but if either chamber convenes, that counts as a day. With this week also expected to include three legislative days, the Legislature will have 24 legislative days left to expend before that May 17 deadline. To put that in perspective, by the time the final gavel drops onThursday, this year’s legislative session we will be 20% complete.

Big Three Bills

Legislative leadership and Gov. Kay Ivey agreed that three bills are of the highest priority: offering limited liability for coronavirus-related lawsuits, reauthorizing Alabama’s premiere economic development statutes and ensuring entities and individuals aren’t charged state income tax on any federal relief money they receive. Lawmakers moved fast on those bills out the gate, with each of them passing their chamber of origin. 

House Bill 170 by Rep. Danny Garrett, R-Trussville, specifies that federal COVID-19 relief funds received by individuals, businesses or organizations are not subject to state income tax. It also makes other reforms to Alabama’s corporate tax code, including changing the current double weighted sales factor to a single sales factor and making statutory changes that prevent the Trump tax cut law from unnecessarily impacting incentives for new and expanding industry. The bill cleared the House Ways and Means Education Committee Wednesday, passed the full House Thursday by a unanimous vote, and now awaits action in the Senate Finance and Taxation Education Committee. 

Senate Bill 30 from Sen. Arthur Orr, R-Decatur, provides limited liability protection for businesses and other entities from lawsuits related to COVID-19. At the moment, the state is providing such immunity on a short-term basis from Gov. Ivey’s emergency orders, which will eventually expire.  The bill passed the full Senate Thursday by a 27-1 vote and now awaits action in the House Judiciary Committee. 

Finally, House Bill 192 by Rep. Bill Poole reauthorizes and revamps the state’s economic development laws. Instead of doing a simple reauthorization of the Alabama Jobs Act and the Growing Alabama Credits, Poole and Secretary or Commerce Greg Canfield are seeking to combine those laws and streamline the entire economic development system. The bill increases the annual caps on the Alabama Jobs Credit and its sister Investment Credit by $25 million in both 2021 and 2022, taking it from $300 million to $350 million. It also increases the cap on the Growing Alabama Credit from $10 million to $20 million. The bill also offers tax breaks to automakers who will ship vehicles out of the Port of Mobile, which is a big deal considering the Alabama Port Authority is building a $60 million automotive terminal that will allow for vehicles to roll on and off of ships. The 57-acre terminal will be able to handle 150,000 vehicles annually with connections to rail service and highways. House Bill 192 passed the full House Thursday by a vote of 94 to 1, with Rep. Andrew Sorrell, R-Muscle Shoals, being the lone no vote. The bill now goes to the Senate where it has been referred to the Finance and Taxation Education Committee.

Worth watching tax credits

That last part makes this bill worth watching as it moves to the Senate. Sorrell went to the floor Thursday raising questions about a provision in the bill that includes new credits for new or expanding women- and Black-owned enterprises. Sorrell took issue with why Black people were the only minority included in the bill and questioned whether allowing for women-owned business would be a “loophole” allowing men to name their wives as owners of the business to qualify for credits. 

To be sure, Sorrell wasn’t the only lawmaker who had problems with the Black-and-women-owned tax credits. Several within the House Republican Caucus had discussed offering an amendment stripping that language from the bill entirely – an action much of the business community warned would be unnecessary, unproductive and another bad look for the state. The matter came up briefly in committee, but it was Chairman Bill Poole and Rep. Danny Garrett who explained to colleagues that their concerns about the race parts of the bill were unfounded.

Interestingly, it may have been Sorrell’s speaking on the House floor that ultimately convinced the other lawmakers to rein it in. Rep. Debbie Wood, R-Valley, took to the floor to challenge Sorrell’s assertions, particularly when it came to his perception of women-owned businesses. She and other women don’t need their husbands permission to run a business, she said, and any assertion that they did is insulting. While Sorrell seems to thrive in this kind of controversy, others in the caucus do not and sources tell Inside Alabama Politics that the performance showed the risks of moving forward with an amendment that is so highly charged on race and gender.

However, keep an eye on this issue as it moves to the Senate. It was rumored in the State House that a handful of senators was actually behind the effort to remove the race and gender language, preferring the House to do the work for them. Should the effort actually go forward either in committee or on the floor, it could quickly end the “kumbaya” cordiality between the parties upstairs. It could also be a first test for Senate President Pro Tem Greg Reed, R-Jasper, who is carrying the bill in the Senate.

What’s coming on Gambling

By TODD STACY, Alabama Daily News

All eyes are on first readings this week as we anticipate the filing of a wide ranging gambling bill from Sen. Del. Marsh, R-Anniston. No longer the top leader of the Senate, Marsh is focusing his energies on just a handful of issues, this being at the top of the list. His proposal is not final, but sources with knowledge of the discussion have explained the basics to IAP. Marsh’s bill will address the casino gambling issue, with limited expansion in certain parts of the state, call for a lottery and legalize some form of sports betting.

Of all the issues, the lottery is probably the easiest. Every poll for the last ten years has shown statewide support for a lottery is exceeding high and getting higher. One could argue that the only reason a lottery bill hasn’t passed the last several years is that the casino interests did not want to give it up as a chip to play in negotiations on a larger gambling proposal.

Word to IAP is that the usually warring casino factions – the old dog track casinos and the Poarch Band of Creek Indians – are relatively happy with the basics of Marsh’s plan. Existing bingo slot machine casinos in Macon, Greene, Mobile and Jefferson counties would be allowed – after purchasing multi-year licenses for prices reflecting their income – to expand to Class III gambling (table games) as full-fledged casinos. The Poarch Creeks could also expand to Class III and, subject to a compact with the state, operate a new casino property in North Alabama, perhaps in Jackson, Dekalb or Marshall counties.

One sticky wicket could be sports betting. While more attention is paid to the lottery and casino issues, allowing sports betting is popular with younger generations and potentially lucrative for the state as it grows. But how exactly the state should go about it is up for debate. Should anyone be allowed to operate a sports book so long as they paid for a license? Should only casinos be allowed to run sports books, similar to how it used to be in Las Vegas and Atlantic City? Should it be somewhere in the middle with only a limited number of licenses? Expect the casinos to push hard to only allow sports betting at casinos. That will matter for two reasons. One, the casinos have leverage because it is their delicate detente that will hold any bill together long enough to get through the Legislature. And two, “casinos only” on sports betting might be a provision that some lawmakers like because they could sell it to constituents as “limiting gambling.” Still, others will contend that the casinos only approach limits competition and hurts the little guy. Don’t forget that the sports betting world is big and growing by the day, and those from the industry could be lobbying up and getting in the game soon as well.

Aside from the actual business of gambling, the other big issue in this debate is whether and how to limit political spending by gambling interests. Many states have sought to limit or ban outright gambling interest from donating to candidates or forming PACS in order to prevent the industry from taking over state politics. Such a restriction will certainly be in this debate, but the details are complicated. Some argue that such a ban would only cause gambling interests to obscure their donations by sending them through national PACs, as has been done recently in Louisiana. Why not just have it all out in the open, they say. Others say restricting gambling money in politics is good public policy and, as long as done thoroughly, can prevent casinos from exercising outsized influence and control of government, as Mississippi has seen. Other groups and companies are watching this as well, wary of how their influence with lawmakers could wane if casinos’ spending is unchecked. Should restrictions on political spending not be included in Marsh’s bill, expect other trade associations to speak up.

Then there is the matter of where all the money would go. In years past, the Legislature has seen all kind of revenue splits when it comes to gambling proposals. The most common and popular is sending lottery revenue to education, whether in the form of college scholarships, teacher pay raises or sending more to First Class Pre-K. In recent years, some have proposed spending at least some of the money in the General Fund, where prisons and Medicaid were perpetually underfunded for years. Marsh’s proposal will likely split up the revenues and he has already said he wants some of the money for college scholarships. Specifically, look for lottery revenues to go toward scholarships for those who pursue in-demand fields to match up with the workforce needs of the state. However, look for a new item to enter the revenue conversation this year: broadband. Among the top priorities for Marsh and other legislative leaders the last few years has been expanding access in rural areas to high speed broadband internet. The Legislature has twice expanded what the state can do through its grant program through ADECA, but it’s clear a more direct funding approach will be necessary to spur development. That became clearer last week after experts told state leaders it would cost $4 billion to $6 billion over time to bring broadband access to underserved areas of the state. The Legislature is likely to debate more policy-centric broadband bills, but expect Marsh’s gambling bill to help fund those. Specifically,  as much as 75% of the revenue from casinos could go to the General Fund, much of which could be earmarked for broadband expansion. Also look for revenues to be directed to rural healthcare services, mental health services and counties and cities throughout the state.

Marsh’s bill is also expected to offer details on a Gaming Commission (who appoints, etc) and call for a special session on enacting enabling legislation that fleshes out all the policy if and when the constitutional amendment passes a statewide referendum.

Marsh is in negotiations with the governor’s office as Gov. Ivey is keenly engaged in this issue. A bill is expected to be filed as soon as Tuesday.

Shelby keeps us waiting, but for how long?

By TODD STACY, Alabama Daily News

Turning our attention to Washington, it was U.S. Sen. Richard Shelby again making news over the weekend with AP’s Kim Chandler reported that Alabama’s senior senator has told confidants that he will retire when his term ends and not run for reelection in 2022. This, as previously discussed in IAP, is true. Shelby has told many people he’s not running again, and those people have told others and so on to the point where this is the worst kept secret from Montgomery to Washington.

The difference this time, however, is the public nature of it all. It’s one thing for The Hill or Inside Alabama Politics to report on Shelby’s plans, but another thing entirely for it to earn a weekend AP headline, especially during a state legislative session when Kim Chandler is up to her elbows in work.

His staff was quick to clarify that he has not made a decision or an announcement. That will be “forthcoming in the next few weeks,” Communications Director Blair Taylor said.

Was this simply AP catching up to an ever-churning rumor mill and getting sources on the record reacting to it? Or was it initiated by Shelby world in an attempt to prepare the ground for an announcement later to come?

In my political judgment, the latter is much more likely, and so I would expect an announcement from Shelby sooner rather than later. Maybe much sooner.

In any case, the story did one significant thing: get people beyond the relatively small bubble of Alabama Politics talking about a future without Richard Shelby in the Senate and what another Senate campaign will look like in 2022.

Not much has changed since we last wrote about that potential race. The most oft mentioned candidates are Congressman Mo Brooks, Secretary of State John Merrill and BCA President and CEO Katie Britt. Brooks has been busy spreading around internal polling data that shows him with higher name recognition than Merrill and Britt, which is not surprising after his leading role in the effort to challenge Trump’s electoral loss. Brooks biggest weaknesses are with the state’s business and agriculture communities, as well as national campaign committees who never have appreciated his style but certainly don’t after his “take names and kick ass” antics leading up to the Capitol riot. That means lots of money could be stockpiled to run ads against him, a tactic that worked to suppress his candidacy during the 2017 special election primary. Brooks remembers that bitter pill on election night, but at least he wasn’t risking a comfortable seat in the House to pursue the Senate that time. This time he would be.

Another name is being thrown in the hat, according to IAP sources. Lynda Blanchard, a Montgomery native and former Ambassador to Slovenia under Trump, is strongly considering a run. She’s the co-founder of the non-profit 100X Development Foundation, which supports international childhood education and welfare. She also founded B&M Management, a real estate investment firm, which is valued at more than $1 billion. Although a relative unknown outside political circles, Blanchard would have the resources to raise her name recognition, and her bonafides as a Senate confirmed Trump appointee wouldn’t hurt.

Aderholt to the catbird seat

We’ve written before about how Shelby’s eventual departure from the Senate will be a devastating blow in terms of influence for the state’s congressional delegation. It’s why many continue to try to talk him into running again. Losing the member with the fourth highest level of seniority over all and the highest ranking Republican on Appropriations won’t be easy to manage.

However, Alabama won’t be without seniority on Appropriations. Congressman Robert Aderholt, the dean of the House delegation, has served on the House Appropriations Committee for 24 years. He has as much seniority of anyone on the committee and only lost out on the chairmanship last time because of the heavy influence of the Texas delegation on the House Republican Steering Committee, which chose fellow 1996 classmate Congresswoman Kay Granger over him. He’ll have another shot at chairman after the 2022 election.

Those who have worked with him over the years, from lobbyists to high level staffers to congressmen themselves, tell IAP Aderholt is capable able and ready to handle leading the state’s Appropriations efforts once Shelby retires.

“Robert has put in the time, built the relationships and collected the favors to be a very effective appropriator,” one such source told IAP. “People on the outside don’t really see it, but that’s a different world, even within the rest of Capitol Hill. When you can navigate appropriations you can do a lot for your state, and Robert knows it inside and out.”

For this Congress, Aderholt will serve as Rankling Member on the Subcommittee on Commerce, Justice, Science and related Agencies, better known as CJS. That panel controls the spending accounts for NASA, the FBI and the National Oceanic and Atmospheric Administration – all of which have policies directly and significantly impacting Alabama. He also remains a member of the Subcommittee on Defense, a key panel that controls military spending.

Latest on the Alabama Bar Association

By MARY SELL, Alabama Daily News

Last month, Alabama Daily News reported that the Alabama Bar Association wanted to hire former Montgomery County district attorney Ellen Brooks as its interim leader while it sought a permanent leader. The proposed six-month contract is for $115,500.

But the bar pulled the contract from last month’s Legislative Contract Review Committee, the panel of lawmakers that reviews service contracts issued by state agencies, because of Brooks’ supernumerary status and questions about the legality of her taking the temporary position.

Now, an attorney general’s opinion says state law allows for a former district attorney to serve as the interim executive director of the Alabama State Bar. On Thursday, bar President Robert Methvin, Jr. was before the committee and cited the attorney general’s opinion written late last month.

“Based on the fact that we’ve gotten the green light from the AG, we respectfully request that y’all approve her contract,” Methvin told the committee.

The state’s “double dipping” laws are clear that former state employees whose retirement is funded through the Retirement Systems of Alabama can only continue to work for state agencies on a part-time basis and their incomes are capped. In 2020, that limit was $32,000.

But part of the issue in the bar’s situation is that Brooks is a supernumerary district attorney. They’re not part of RSA, but are paid through the General Fund and could be called back into temporary service at any time. They earn about $112,000 a year. This year’s General Fund budget allocates about $5.3 million to supernumerary DAs.

The issue the bar asked the attorney general to consider is whether being interim executive director of the bar  is “an office of profit.” The state constitution and state code both say that no person shall “hold two offices of profit at one and the same time under this state.”

Attorney General Steve Marshall’s opinion last week said the interim director job at the state bar is not “of office of profit” in part because it is not an elected or appointed position, but hired by a board under a contract and “will not wield the sovereign power of the state.”

Sen. Arthur Orr, R-Decatur, said he understands the reasoning in the attorney general, but moved to hold the contract. He said there is “duplicity between someone with a supernumerary status and making substantial money in retirement,” being able to work for state boards, and most retired state employees, who don’t have that option.

“To me, it creates a very unfair system between the rank-and-file and those who would have very peach assignments,” Orr said.

He also said his concerns have nothing to do with Brooks, who he praised for her public service.

“Sorry to be the thorn in the flesh, but that’s where we are,” Orr said. “I’ve got a plan to fix it and there’s a bill in motion that we can work with that will make sure this doesn’t happen again.

”The committee can only delay contracts for 45 days and Orr acknowledged that the bar could ask the governor to sign it regardless of the committee’s view.

Later, Orr told Alabama Daily News that he’s concerned that in the future, more higher-paid state employees could use the law to get lucrative contracts with boards.

“What bothers me is, for the rank and file state employee who doesn’t have the luxury of being an executive director for an agency with a board to report to, they’re capped at $32,000 a year and don’t have this opportunity.”

Brooks was the Montgomery County DA for more than 20 years until her retirement in 2014. It was in her supernumerary role that Brooks was tapped in 2017 by Marshall to investigate then Gov. Robert Bentley.

Potpourri

The Alabama Rural Electric Association has tapped Karl Rayborn to succeed outgoing Fred Braswell as President and CEO. Braswell is retiring after leading the association of coops for more than 20 years. Rayborn has been working as Senior Vice President and Chief Financial Officer for AREA, so his ascent is a direct promotion. AREA is a statewide trade association combining the resources of Alabama’s 22 electric distribution cooperatives, PowerSouth Energy Cooperative and the Tennessee Valley Authority to advocate for policies that benefit is members.

Lori Ward Williams has been brought on as the Economic Development Specialist with the Central Alabama Electric Cooperative. Those who have been around Alabama Politics since the mid-2000s have probably worked with Lori in some capacity as she is a veteran of GOP campaigns. Most recently, Williams worked as District Director for Congresswoman Martha Roby, the top state level job in the office. In her new role with CAEC, she will service a 10-county area to build relationships and foster economic development opportunities. The coop recently launch its Central Access subsidiary, which will bring high speed broadband internet to rural parts of its Central Alabama territory.

The Alabama Farmers Federation has added Casey Rogers to its State House team. Rogers, a native of Greenville from a third generation farming family, has spent the last three years working for Congresswoman Martha Roby as a field representative in AL-2. She’s a University of Alabama graduate with more than eight years of experience working in Alabama Politics. Matthew Durdin, who leads ALFA’s efforts at the State House, said Rogers has been named Director of State Legislative Programs, calling her “perfect” for the role.

Yet another Roby staffer making her next move is Caroline Franklin, who has just been hired to run communications for Senate Majority Leader Clay Scofield. Among Scofield’s priorities coming into the job has been to push out positive messages from the Senate GOP Caucus, as well as offer individual members more help with communications, understanding most don’t have much in the way of staff. Franklin is an experience communicator, having most recently worked as Communications Director for Roby and previously worked in Sen. Richard Shelby’s comm shop.

Though she’s careful to keep her name out of the press, Melissa Tindol is no stranger inside the State House. In fact, she’s a familiar face that senators know well from her corralling them on behalf of the Pro Tem for votes. Tindol was recently promoted to Deputy Chief of Staff to Senate President Pro Tem Greg Reed, a significant bump to match her significant contribution to the office. Rewarding the hard work of journeymen staffers is always nice to see.

Finally, Lynn Lowe Cole has been hired as the new Communications Director for the University of Alabama Systems. She’ll replace Kellie Reinhart, who is retiring from the system. UAS has been in the business of raising its public and political profile in recent years and its staff hires have reflected a need to go beyond traditional institutional types to those with more political experience. Cole comes from the Birmingham-based Markstein marketing firm and previously worked for former Congressman Jo Bonner.

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