Several committees and sub-committees in both the House and Senate have been meeting since the end of the regular session to study various options – taxes, cuts, un-earmarking, gambling/lottery as well as a couple of other items that may prove interesting in the days ahead. These committees were meeting on a timeline to complete their work by early August, hopefully deriving at some consensus between the House and Senate membership on a path forward and be ready for a supposed mid-August call for a special session by the Governor.
The Alabama Constitution limits a special session to 12 legislative days within a 30 day calendar. Therefore, once the Governor called the special session to begin on Monday, 13 July, both the House and Senate agreed to recess until Monday 3 August so that committee work could continue. In short, we’ve burned one of the 12 legislative days but have until 11 August (30 calendar days from 13 July) to complete the session. What the actual schedule will look like in August – Monday through Friday or Monday through Sunday – remains to be seen. An important note to consider – the minimum days required for a bill to become law is 5 days; assuming of course that the majority has agreement to move legislation that quickly.
Why The Rush?
I’ve been asked why the Governor called the special session early. Reading the tea-leaves - the best answer I can give is he wanted to cut short the mounting pressure from lobbyist and special interest groups that are pro-gambling/lottery. I’ll agree the pressure is there as I continue to hear from all sides of the gambling/lottery argument but I disagree that the pressure will get any worse. What I don’t want to do is rush into a session and debate legislation to fix our budget woes based on incomplete studies on some of the options that will be presented.
What’s In The Call?
When a Governor makes a call for a special session he limits what bills can be introduced during the special session. I linked to the entire Proclamation for the call in last week’s blog and provide a bulleted overview of what tax increases the Governor included in the call below:
Business Privilege Tax: End if a business net worth is less than $10k; increase maximum tax and rates for larger businesses = $38 mil
FICA Income Tax Deduction, the amount you pay to the Federal Government for Social Security and Medicare is currently deductable from your state taxes: Remove deduction for individual state tax returns = $182mil
Tobacco Tax increase $0.25/pack, proportional on other products including e-cigs (note, e-cigs are currently only subject to normal sales tax) = $70mil
Soda Tax: $0.05/12oz can (sodas are currently only subject to normal sales tax) = $182mil
Revenue Un-earmarking/Use Tax Transfer: Allow funds from FICA and withholding bills to go to General Fund Budget instead of Education Trust Fund Budget = $225mil
Un-earmarking: Agencies with earmarks and General Fund appropriations would have funds un-earmarked = $400mil total
What’s Not In The Call?
The Governor attempted to limit the introduction and passage of gambling and lottery legislation with this clause in the proclamation for a special session:
“All legislation regarding gambling or games of chance commonly played at casinos or gambling facilities is expressly excluded from this call and shall require a two-thirds vote for consideration throughout the duration of this extraordinary session of the Legislature.”
Read carefully, this certainly impacts legislation for what I call casino style gambling but does not limit a lottery – you don’t normally purchase lottery tickets at a casino. However, gambling or a lottery would require a Constitutional Amendment and therefore must receive more than a simple majority vote to be sent to the Governor. I explain this further below.
May Other Bills Be Introduced?
Yes, legislation outside of what the Governor has called a special session for may be introduced and numerous already have been – you can review bills introduced in the Senate here. No bills have been introduced in the House for the special session as of today's blog post. These bills can be assigned to committees and will work their way through the process but will need more than a simple majority to pass should they make it to a floor vote. Anything in the Governor’s call only requires a simple majority vote. Any legislation introduced outside of the Governor’s call requires a 2/3rds vote to pass. If legislation results in a Constitutional Amendment, such as for gambling or a lottery, it requires a 3/5ths vote.
I will continue to update the blog in the days and weeks ahead. As always I welcome your comments and feedback. Feel free to email me here.
Semper Fi - Bill