Rumors & Rumblings

“Rumors and Rumblings” is a weekly feature that runs each Wednesday. It includes short nuggets of information that we glean from conversations throughout the week. Have a tip? Send it here. All sources remain confidential.

1. ALGOP Chairman Race Update

Sources inside the Governor’s office told Yellowhammer Tuesday that the Governor is excited to be attending Matt Fridy’s Saturday morning breakfast as a special guest and that the Governor looks forward to continuing his public show of support for Fridy’s candidacy.

2. War Brewing Over Medicaid Cuts

Alabama’s $600+ million dollar appropriation to Medicaid makes it by far the largest line item in the state’s general fund budget. And with Governor Bentley’s and the GOP legislature’s steadfast commitment to pro-growth policies, cuts are going to have to be made. But a fight is now brewing over where inside Medicaid those cuts will come from.

Medicaid’s funding is built on hospital and nursing home taxes. Because of that, it is unlikely the Bentley administration will seek cuts from them, because they would in turn fight the reauthorization of their taxes. That leaves pharmacies as the most likely target for cuts.

According to sources familiar with the current Medicaid predicament, State Health Officer Dr. Don Williamson is working to bring in a pharmacy manager in an attempt to bring down pharmacy costs. This will cost pharmacists approximately $120 million. Because no other providers are currently being asked to sacrifice, the pharmacies have declared war. This one is going to get ugly.

3. Government Efficiency Plans Coming Together

Governor Bentley and Senate President Pro Tem Marsh last week released dueling government efficiency plans, both aimed at streamlining public safety agencies. Insiders now say the Governor and Pro Tem are very close to coming to an agreement on a combined effort that would produce a single piece of legislation.

Unlike what we’re seeing out of Washington, it’s encouraging to see a solid commitment to cost cutting measures from both sides of Union Street.

4. Hightower Surges in SD 35 Special Election

Businessman Bill Hightower almost won the SD 35 special election outright on Tuesday, claiming 46.5% of the vote. Rep. Jim Barton came in second at 30% and Nick Matranga placed third with 23%. Hightower and Barton will now move on to a March 12 runoff.

Only about 7.5% of registered voters in SD 35 made it to the polls on Tuesday. This mitigated Barton’s significant fundraising advantage and placed an added focus on each campaign’s grassroots organization.

Hightower’s general campaign consultant Chris Brown led an impressive effort. With a six week runoff ahead, the campaign is far from over, but Hightower & co. have to feel good about where things stand.

5. API Weighing in on Energy Policy

The Alabama Policy institute will over the next few days release a three-part series of articles focused on Alabama energy issues. Energy policy has come to the forefront in recent days after the usually-below-the-radar Alabama Public Service Commission became a hotbed of political activity.

API concludes that “the recent clash at the PSC is over a strategic environmental policy agenda.” While API sticks to the policy facts and doesn’t delve into the politics at play, that conclusion clearly strikes a huge blow to Republican Public Service Commissioner Terry Dunn. Dunn has spent the last several weeks fighting to refute the growing evidence that his actions have empowered Alabama’s budding liberal environmentalist community.