The Wire

  • Three takeaways from Alabama’s Runoff Election


    With Alabama’s primary election runoffs now in the books, here are three takeaways from the results.

    North Alabama has spoken.
    When this election cycle began, it became evident that north Alabama saw a window of opportunity to increase its influence.  The results from the Republican primary runoff have shown the electorate in that area of the state was eager to flex its muscle.

    Will Ainsworth pulled out an impressive come-from-behind victory in the Lt. Governor’s race. Steve Marshall enjoyed a resounding win in his bid to retain the Attorney General’s office.

  • On Roby’s win: One false media narrative dies, a new one is born


    Like Lucy van Pelt of Peanuts comic strip fame repeatedly pulling the football away from Charlie Brown as he lines up to kick it, Rep. Martha Roby (R-Montgomery) once again has shown you can’t beat her in a Republican primary.

    Similar to when she defeated “Gather Your Armies” Rick Barber in the 2010 GOP primary and “Born Free American Woman” Becky Gerritson in the 2016 GOP primary, Roby defeated former Montgomery Mayor Bobby Bright for a second time on Tuesday night, this time by a whopping 36 points.

    Heading into yesterday, many national media reporters were sent into Alabama’s second congressional district looking at the possibility that Roby might have to answer to a revolt for not sticking with then-Republican presidential nominee Donald Trump on the infamous Billy Bush weekend during the 2016 presidential campaign.

  • Mo Brooks Wins FreedomWorks’ Prestigious 2017 FreedomFighter Award

    Excerpt from a Rep. Mo Brooks news release:

    Tuesday, Congressman Mo Brooks (AL-05) was one of only 31 members of the U.S. House of Representatives awarded the prestigious 2017 FreedomFighter Award by FreedomWorks, a leading conservative organization with more than six million members nationwide. Only members of Congress who score better than 90% on the FreedomWorks scorecard receive the FreedomFighter Award. Congressman Brooks’ FreedomWorks score was in the top 4% of all Congressmen in 2017.

    Brooks said, “FreedomWorks is a leading organization in the conservative movement. I thank them for their work keeping members of Congress accountable and scoring key House floor votes which helps the American people better understand the impact of those votes. I was proud to receive the prestigious FreedomWorks 2017 FreedomFighter Award for my voting record in 2017. If America is to maintain its place as the greatest country in world history, more members of Congress must fight for the foundational principles that made America great. I’m fighting in Congress for those principles, and I’m glad to have a partner as effective as FreedomWorks in the fight.”

3 months ago

Michael Knowles featured at Alabama Policy Institute’s 19th annual dinner event in Mobile


On Tuesday, the Alabama Policy Institute held its 19th annual Mobile dinner event in the airplane hangar at the USS Alabama Battleship Memorial Park.

“I cannot think of a better place to discuss freedom and liberty than at the U.S.S. Battleship Memorial Park and Aircraft Pavilion, a place that holds so many reminders of the sacrifices that thousands of Americans have paid to guarantee our freedom and liberty,” Caleb Crosby, President and CEO of API, told Yellowhammer News.

The “Evening with the Alabama Policy Institute” included keynote speaker, Michael Knowles.

Knowles is a talk show host and former managing editor of The Daily Wire, who is most well-known for his best-selling (and blank) book Reasons To Vote For Democrats: A Comprehensive Guide.

Part of a generation of young-ish conservatives that includes the Wire’s, Ben Shapiro, Knowles spends much of his time traveling to universities and rebutting their brand of “illiberal liberalism,” as Frank Bruni of the New York Times has called it.


“I feel that here we’re in a safe space,” Knowles opened his speech last night, mirroring Crosby’s sentiment by ironically appropriating the campus buzzword.

“We’re definitely in a safe space because there are lots of guns and battleships. This is the perfect safe space for conservatives to be on tax day.”

Knowles’s speech before API and guests was as much about making the case for conservatism and for President Trump as about rebutting progressivism.

He began by reminding everyone in the room of all the good that the Trump presidency has accomplished: tax cuts, deregulation, originalist judges.

“Now you might be having déjà vu,” he said, “because I could have given that exact same [list] in 1981.”

Pointing out similarities between Reagan was Knowles’s primary way of arguing that Trump has governed as a conservative. In some ways, it also seemed to be his way of coaxing those never-Trump conservatives to embrace the president, or at least to encourage those conservatives supportive of — but still apprehensive — about him.

“Take the victories that we can get today,” Knowles said.

His chief point was that politics is about the now.

“Politics changes all the time,” he said. “There are different circumstances. There are different public policy challenges. There are different public policy prescriptions. There are timeless principles. And of course the hope, is that we conservatives can maintain the bedrock of timeless principles that we can apply to new circumstances and new challenges and make America great again, again.”

“Political victories are never permanent,” Knowles continued. “Political successes are never permanent. That’s why you always need to be making America great again. It’s because otherwise, it’s going to revert to its natural state of decay and destruction.”

@jeremywbeaman is a contributing writer for Yellowhammer News

7 months ago

Alabama debates how much will be needed to fix mental health issues in its prisons




Alabama will almost assuredly put more taxpayers dollars into prisons next year, but the biggest question is how much.

Southern Poverty Law Center and the Alabama Disabilities Advocacy Program, who filed a federal lawsuit on behalf of state inmates, want up to $150 million a year to correct deficiencies in health care and security.

The state submitted a proposed plan to the court in October that calls for doubling the mental health staff in its prisons, which would entail adding 125 full-time employees at an annual estimated cost of $10 million. More correctional officers would also be hired, with no cost yet provided. That plan is tied into lawmakers passing a bill to increase funding for Alabama prisons during the 2018 legislative session that begins on Jan. 9.

U.S. District Judge Myron Thompson ruled in June that the state is in violation of the U.S. Constitution’s Eighth Amendment that bans cruel and unusual punishment. Thompson said that the Alabama Department of Corrections failed to adequately identify inmates with mental illness and provide them adequate care. He said more staffing is needed to correct the problems.

Thompson will conduct a series of hearings over the next few months on solutions to fix the issues. ADOC Commissioner Jeff Dunn testified earlier this month that preliminary staff analyses have found that at least one prison may need quadruple the current number of correctional officers.

Dunn said the staffing shortage is a major obstacle to providing sufficient health care because officers are needed to transport patients to and from treatment and provide security during group sessions.

Sen. Cam Ward, R-Alabaster, told Yellowhammer News the SPLC plan is too extreme and “far out of the realm” of what the state could realistically achieve financially.

He said a plan to meet minimum constitutional standards and receive Thompson’s blessing would likely require an additional $15-$20 million the first year to hire new workers and begin new programs and an annual expense of about $40 million per year after that.

Ward said there may be an opportunity to shift money toward the Alabama Department of Corrections rather than seek new revenue. A move away from Medicaid’s Regional Care Organizations may provide an opportunity for budget shuffling.

“That’s money that was going there that we don’t need to send anymore,” Ward said. “Some of that could go to help pay for part of this. I think all of us have a goal of not raising a bunch of taxes to do this.”

Maria Morris, senior supervising attorney at the SPLC, said in a recent blog post that conditions have only gotten worse since the judge’s order.

“ADOC was already shockingly understaffed. But it lost an additional ten percent of its staff this summer,” she said. “Prisons are populated at 160 percent capacity, and there is no system in place to ensure prisoners receive the care they need. Fixing this decades-long culture of neglect will not be easy, but it will continue to get more difficult every day the state fails to act.”

The overcrowding issue is a separate issue that has been at the forefront, and the concept of a $800 million bond issue for new prison construction has been discussed. The Alabama Policy Institute said that’s untenable.

“While some tax dollars may be required to repair the state’s broken system, it is the legislature’s duty to be responsible with such and have a long-term solution in mind,” the organization told Yellowhammer News in a statement. 

Ward said mental health problems are the biggest drivers in crime. And he noted that just locking people away in cells who suffer from mental issues like post-traumatic stress disorder and bipolar disorder without any effort at treating the problems will only make them a bigger threat to society when they are released from prison.

“You can go back and in about half of your cases, somehow, someway, there has been a mental health problem there,” he said. “I want them to be productive members of society, following the law and not be a threat to anybody. It’s better long-term for us to address this. It’s a shame a court order had to force us to do it, but we’re here now so we need to address and fix it.”

Johnny Kampis is a resident of Cullman. Over the course of his nearly 20 years in journalism, he has been published in such outlets as the New York Times, Time, Fox News, American Spectator and Daily Caller.


Time to refocus on Montgomery issues like this little known fact about your taxes

Alabama State Capitol


Thinking back on the last year, a few things stick out in my mind: the words “fake news,” Alabama’s epic comeback to get a spot in the college football playoff (roll tide), and political ads from Alabama’s Senate election haunting me in my waking and sleeping hours.

With news cycle after news cycle over the last year dominated by this race, the memory of Alabama politics in 2017 is going to have me cringing for years to come.

But here we are, December 15, and we made it through the special election. I honestly never thought this day would come. In fact, at the beginning of this week, I started to panic a little bit about it all being over. What are the news outlets going to talk about now?

Here’s one thing: The Alabama legislature convenes on January 9 — only 25 days away. Now is the time for Alabamians — both lawmakers and voters — to refocus.

While keeping an eye on Montgomery might not be as interesting as D.C. politics, it’s no less important. Just like in D.C., your elected officials are deciding how to spend your tax dollars (well, around 7 percent of your tax dollars, but I’ll get to that). They’re making decisions that impact your life, your family, and your business. It’s our votes that elect them, and it’s our tax dollars that we allow them to appropriate each year to keep the lights on in Alabama. And we have some serious issues that our lawmakers should feel encouraged to tackle this year.

For example, did you know that ninety-three percent of Alabama’s budget is earmarked? That’s right: When lawmakers go to Montgomery to create the budget, they only have discretion over 7 percent of tax revenues that come in each year. Lawmakers should take a look at those earmarks, eliminate those that don’t directly align with Alabama’s needs and priorities, and shoot for trying to get that number down to 25 percent.

Or, how about this: Did you know that Alabama is the fourth most federally-dependent state? According to recent polling, an overwhelming majority of Alabama voters are concerned about this level of dependency and would like the legislature to hold a recorded up-or-down vote before accepting more federal funds. That’s not so difficult.

Going into an election year in 2018, it’s a given that legislators won’t want to do anything too controversial out of fear of losing their seat. But bringing responsibility back to budgeting, cutting a number of ties with the federal government, and restoring individual rights are goals that are far from controversial. In fact, if my representatives go to Montgomery on January 9 with those goals in mind, I cannot wait to vote for them in November.

When lawmakers return to Montgomery in less than a month, they ought to make it clear that they intend to protect their voters — Alabama taxpayers. And voters ought to shift our attention to Montgomery and hold them to that.

Taylor Dawson is Director of Communications for the Alabama Policy Institute. 


API: Alabama must save its sovereignty, stop depending so heavily on federal funds




While it is difficult to persuade a state that relies on the federal government for 42 percent of its budget that it should begin to unwind some of those funds, there is arguably more for a state to gain than lose by shedding some of its dependence on the federal trough.

But even if voluntarily forgoing such assistance is a bridge too far, it is becoming more and more essential for the state to assume greater financial responsibility.

Alabama voters are looking at legislators to do just that.

An overwhelming 79 percent of recently surveyed Republican primary voters considered it important for Alabama to be financially prepared for the likelihood that DC will reduce its funding to the state.

Questions about Washington’s reliability are well founded, given the nation’s own financial and political health. Even the most politically disengaged must pause to fathom the $20 trillion (and rising) debt amassed by our federal government.

What’s more, in an increasingly politicized environment, states have seen federal funds threatened over policy differences with sitting presidents of both parties. Whether unable or unwilling, nothing binds Washington to sustain the support on which states have become accustomed.

But there are other reasons to approach conditional federal grants with caution.

When a state accepts conditional funding, it necessarily relegates itself to the dictates of Washington, selling short both legislators and citizens alike; state lawmakers are unable to influence the policies imposed on their constituents and cannot be held responsible for complications in implementation.

Accordingly, citizens must rely on a detached DC bureaucrat to address concerns about policy impacts on their lives and businesses.

Voters resent this “Mother May I?” approach to lawmaking. Nearly three-quarters of those surveyed trusted the efficiency of state-run programs over federally run programs, while only 34 percent indicated any faith that federal spending in Alabama reflects our state’s values and priorities.

Furthermore, the nature of grants conditioned on DC mandates invites cynicism that develops when governing policy and law is developed by a far-removed legislative body.

Only 33 percent of voters polled felt informed about the federal policy “strings” attached to money already accepted by the state.

These obstacles to accountability and transparency — hallmarks of good government — hinder voters’ ability to identify or expound on specific programs and is a pariah to the spirit of the American system, which rests on the consent of the governed.

Making a bad situation worse, federal funds can lead to increased spending in already-strained state budgets, a consequence opposed by 67 percent of respondents surveyed.

This can happen directly, such as when grants require matching funds or financing beyond the initial federal investment to maintain or enhance a program. But it can also happen indirectly, either when federal grants encourage states to undertake projects they would not otherwise choose or when state or local taxes are increased to bankroll overextended commitments.

Whatever the cause, “free” money can become expensive quickly.

Because spending is often the first solution offered by Washington, conditional grants sometimes involve sympathetic causes, such as disaster relief or, on a smaller scale, safety equipment for law enforcement.

Such programs create short-term fanfare for politicians and temporary relief for beneficiaries, but they invite a potential crisis when the money runs dry. Once the federal government assumes responsibility for essential services, citizens and states are left dependent on the whims of Washington to meet critical needs.

Of course, Washington’s willingness to meet these needs is not based on benevolence; rather, it is driven by a desire to impose a particular agenda simply by dangling an irresistible carrot.

But the resources and attention required to avoid the proverbial stick detract from priorities state legislators and officials might pursue if left to their own devices. Ironically, conditional funding can even lead the state to work against the wishes of its own citizens, as was the case with Race to the Top dollars associated with Common Core.

In an era of Washington overreach, Alabama must begin to challenge the mechanisms that make us beholden to the federal government if constitutional state sovereignty is what we desire.

Taking a closer look at conditional federal funding — phasing out existing commitments and more critically evaluating future opportunities, while reevaluating the allocation of our own state funds — is a good place to start.

Leigh Hixon is senior director of policy relations for the Alabama Policy Institute.

(Editor’s note: This post is the second of a three part series focusing on Alabama’s federal dependency. The first was We Dare Defend Our Rights). 

10 months ago

Debate-Gate: The Alabama Senate Race Gets Even Moore Strange

The long-awaited show down in a one-on-one debate between Luther Strange and Roy Moore in the run-off for the U.S. Senate seat was finally on the calendar for Thursday, September 21, giving voters a chance to go beyond the politics of accusation and evaluate the policy positions of each candidate.  And then it wasn’t.

Moore canceled the event, citing the fact that the leader of one of the organizations hosting it is reportedly involved with a PAC that has sponsored ads promoting Luther Strange.

As Moore said in a press release yesterday:

“I have declined to participate in the Alabama Policy Institute (API) & Samford University US Senate Debate…because it was not disclosed to me or my campaign at the time the invitation was accepted, that the President of API, Caleb Crosby, also serves as the Treasurer for the Senate Leadership Fund.”

To this cancellation, the Strange campaign said:

The Alabama Policy Institute has had this event scheduled since August 16th and it was confirmed by both candidates by August 23rd. This comes on the heels of the cancelation of the News Radio 105.5 WERC last week. Another debate is scheduled on Friday, September 22 at 7:00 p.m. CST and is hosted by AARP and Raycom Media pending no refusal from the Moore campaign.

Expounding on the cancellation, Strange for Senate spokesman Cameron Foster, added:

“Another week, another canceled debate from Roy Moore. The only time we’ve seen him in the last three weeks was when he was flying to Washington D.C. for a fundraiser with NeverTrumper Alan Keyes. Roy Moore, like so many other career politicians, must believe he is above answering questions from Alabama citizens. What is Roy Moore afraid of? What is Roy Moore hiding? Voters should ask themselves, if Roy Moore refuses to answer questions from voters, will he listen to their concerns in elected office?”

In Moore’s press release, however, he was adamant that Crosby’s involvement in the SLF is grounds for him to cancel the September 21 debate at Samford, stating:

The Senate Leadership Fund is responsible for millions of dollars’ worth of malicious and false ads designed to stain my character and reputation. I have asked my opponent repeatedly to denounce these ads against me, my wife, and my family, as he knows that the content contained therein is completely false. However, Luther Strange has not done so. In fact, he has warmly embraced McConnell’s Senate Leadership Fund and Caleb Crosby as his key allies. The fact that this debate was being hosted by the Treasurer of a group so partial to my opponent’s personal interests is yet another Washington trick – the same kind of tricks despised by the people of Alabama.

Despite all this, Moore was insistent that he wanted to debate Strange, but only on his terms. As Moore wrote:

“Over the course of the primary election, Luther Strange failed to show up to 8 different forums where I and the other candidates put our positions and candidacy on the line, which is a fact well known to the Alabama press corps who attended these forums. I find it hypocritical that Luther Strange is now suggesting that I am the one who is ducking debates. We shall see who is ducking debates…I propose a public debate, mano a mano, no tricks, no moderators, no questions from the press. Just Luther Strange and me on the stage presenting our issues and the opponents’ responses thereto.”

To this, Foster replied on behalf of the Strange for Senate Campaign saying:

“It is extremely telling – and frankly, a little embarrassing – when any candidate demands a ‘no questions from the press’ debate.  That said, our campaign believes the voters deserve every opportunity to hear from both candidates in a fair and open forum.  Our campaign will agree to Roy Moore’s conditions, as long as a mutually agreed upon person will act as a mediator and the Moore campaign accepts the invitation from AARP and Raycom on their debate. Arguing over petty issues like format, topics, or moderators is a political game Democrats play and should have no place in this election. The voters deserve a debate, so our campaign will do whatever we can to make sure that happens.

Foster continued:

“Below is a list of extremely reputable journalists and community leaders in Alabama that would be approved by our campaign to act as the mediator. We ask that the Moore campaign respond quickly so the necessary steps can be made to put this event on.”

Michael Hart, Jeff “JT” Tyson, Dan Morris, Scott Beason, Bryan Lyman, Scott Chambers, BJ Ellis, Larry Huff, Don Dailey, Cameron Smith, Kim Chandler, Paul Gattis, John Sharp, Terry Lathan, Steve Flowers, Bob Grip, or any anchor at ABC 33/40, NBC 13, or WSFA (networks previously confirmed for the API forum)

Nevertheless, at the end of his press Tuesday release, Moore threw down the gauntlet for Strange to agree on a debate the way Moore wants it conducted, writing:

“I ask Luther Strange’s Campaign Chairman to contact my Campaign Chairman, Bill Armistead, to accept my offer.”

After all the back and forth, that’s exactly what Luther Strange has done—but with one suggestion: that Moore considers a second debate on Raycom’s terms.

In a Memo emailed to Yellowhammer moments ago, Strange for Senate spokesman Cameron Foster wrote this to  Moore’s Campaign Chairman, Bill Armistead:

The Strange for Senate Campaign is extremely disappointed in how Roy Moore has handled the basic request to debate the issues for Alabama voters.  That said, we are committed to the voters and will accommodate Mr. Moore’s ridiculous demands if that is the only way to get him to come out of hiding. We strongly encourage Judge Moore to also commit to the Raycom Debate in whatever format they feel necessary. This will allow Judge Moore to debate in the format he has so adamantly demands while still allowing Raycom to host the debate they have been working on for a month.

Voters throughout the state deserve to hear from the two candidates in this race and need Roy Moore’s answers to the legal questions surrounding his foundation. Voters want to know why his foundation cheated a Christian fundraising firm who they hired to raise money off of Roy Moore’s antics and who paid the court judgment of almost half a million dollars. This political maneuvering needs to stop so we can give the voters the information they need to make an informed vote on September 26th.

We ask that you please hold your preferred formatted debate on Thursday September 21st in any major media market in the state since both candidates previously indicated that date would work. We ask that the Moore campaign respond quickly so the necessary steps can be made.

For now, at least, it appears the two men may actually meet after all. If that happens, Yellowhammer will report the details. In the meantime, please stand by…


School choice: providing life-changing options for families in Alabama

By Ben Sciacca, Executive Director for Restoration Academy, Birmingham, Alabama

For almost thirty years, Restoration Academy (RA) has been an advocate of school choice. Anthony Gordon, our founder, started RA in 1988 after officiating the funerals of five young men killed due to gang and drug violence. He was distressed by a myriad of realities facing the youth in his community, but one of the chief things that concerned him was that most of the youth in his neighborhood did not have access to a consistent, quality education.

Twenty-eight years later, RA exists to provide families with school choice. We believe that every child and every family should at least have an option on where their children go to school.

One of our most recent additions to RA, Jonathan, has been elated to now be in a school where he is safe and free from the tyranny of bullies and gangs. Prior to being at RA, his parents had to contact the police five different times due to him being assaulted at school. He and his parents also cite how the teachers at RA consistently care for him and provide an environment where he can learn and thrive. Since arriving at RA his grades have soared along with his confidence. This is our hope and goal–that each child will have that experience.

We interview dozens of new families each spring. Many of these families seek enrollment at Restoration Academy for the same reasons. For one, many of them are deeply concerned about the safety of their children at their local schools. They testify about how regular fights and altercations are jeopardizing their children’s sense of peace and well being. Others cite apprehension about the quality of instruction that their children are receiving at their local schools. These parents make it clear that they would like to provide their children with an entirely different environment where issues of safety and the quality of instruction are not things they have to worry about.

The reality is that “choice,” as it relates to education, has largely been relegated solely to communities of higher socioeconomic standing. Most families in lower-income neighborhoods have no choice as it relates to where their children attend school. America affirms that equality is something that should be afforded to all people. It stands to reason that if some individuals are not afforded an equal choice as to where their children attend school, that is an injustice to be remedied. Not only do the children who take advantage of school choice benefit from it, but school choice is shown to strengthen public schools and the surrounding communities.

Restoration Academy has a passion to provide families who are seeking an alternative to their current school with that alternative. If other families around the state have a choice as to where their kids attend school, we believe that the families in our neighborhood should also.

Ben Sciacca serves as Executive Director for Restoration Academy. He holds a masters degree from Covenant College and has been at Restoration Academy for 15 years.

3 years ago

Alabamians should not accept the inevitability of big government (opinion)

United States Capitol (Photo: Eric B. Walker)
United States Capitol (Photo: Eric B. Walker)
United States Capitol (Photo: Eric B. Walker)

The New Year always comes brimming with new goals, possibilities, and expectations. This year, for many, those expectations are closely tied to the 2016 presidential election.

Conservatives had a tumultuous year. The U.S. Supreme Court ruled with unbridled power and without regard to long-settled precedent. The free exercise of religion continued to be hollowed out by politicians and judges across the country. Planned Parenthood’s gruesome treatment of unborn babies was exposed, yet went largely uncensured as the group held onto taxpayer funding. The president’s use of executive action on matters quite beyond the mainstream reached new heights. Even in Alabama, the Republican governor abandoned some of his most prominent conservative campaign promises.

Conservatives feel betrayed by politicians at every level of government. As a result, many have pulled back on their civic involvement. Even some conservative politicians have begun to capitulate and have given up on pursuing an aggressive agenda. Still, they hold on to a glimmer of hope that a dramatic change at the top can get the country going in a better direction.

Perhaps more than in any other time in American history, the past decade has revealed a national epidemic of either ignorance or apathy to the fact that our government is, as Ronald Reagan put it, “beholden to the people.” Exploiting this, government has grown at an alarming rate and has progressively saturated every aspect of our lives. It has gotten so big, so impenetrable, that any rebuke that does come from the general public is easily ignored and hardly threatening.

William F. Buckley Jr., writing in 1963, could have easily been describing 2015 when he said:

“I am fascinated, and concerned, by the increasing submissiveness of the American people. In the course of a single year, a genuinely outraged majority cooled off without doing anything about a challenge to three of the very deepest human commitments, the commitment to one’s God, the commitment to one’s freedom, and the commitment to one’s country. . . . What happened was not the result of a rational dialogue, but the result of a national lassitude.”

That lassitude, or apathy, is bred by a disbelief in the ability to change anything.

While many of us are highly engaged in the ongoing process of choosing our next president, how different would our government be if we were even half as engaged in non-election years? Presidential candidates use issue-based polling as guidance for their positions because they know they cannot win if they stray too far outside the lines of public opinion. What if those in office felt the same way–that ignoring the desires of the public would come with real consequences?

When we (consciously or not) continue to accept big government’s inevitability, we cannot help but elevate presidential elections to the status of our once-every-four-years chance to “right the ship” of our nation. This leads us to pass up numerous opportunities that we have to directly influence government at the local and state level–to really change things from the bottom up, not just the top down, as the Founding Fathers envisioned.

As we enter this new year full of nervous anticipation in the political arena, we should certainly do what we can to ensure the election of the best possible president. Still, the most compelling candidate would admit the limitations of the office, rather than promise us the world. First, many of the presidency’s limitations come from the Constitution and, if properly adhered to, would result in a return of power to the states. Second, no president (or government) can guarantee the preservation of our democracy and ideals without the strength of non-government frameworks–the family, the community, and the church.

In his book God and Government, the late Chuck Colson reminds us that “the answer to the big government illusion is found in small voluntary associations,” or “little platoons,” as Edmund Burke called them. Colson gives numerous examples of families and churches working in the lives of their neighbors, serving the needy, and visiting prisoners. When we do these things, he notes, “in a very real sense, we’re helping to maintain the distinctive character of our society–to preserve America’s richest heritage. We are strengthening the ‘little platoons’ that foster virtue and are the bedrock of America’s freedom.”

Katherine Green Robertson is Vice President of the Alabama Policy Institute (API). API is an independent, nonpartisan, nonprofit research and education organization dedicated to the preservation of free markets, limited government, and strong families. If you would like to speak with the author, please e-mail or call (205) 870-9900.

3 years ago

New Alabama standardized test scores show no link between education spending and academic outcomes

Teacher ClassroomIn the Alabama State House, the familiar refrain surrounding public education is that the legislature has failed to ever “fully fund” it. The implication, of course, is that we cannot and should not expect positive outcomes from our public schools. This philosophy has been refuted by an enormous body of academic research and, last week, was specifically disproved by a report released by the U.S. Department of Education.

The report, the National Assessment of Educational Progress, or NAEP, is published every other year by the National Center for Education Statistics. By testing students in all fifty states, Puerto Rico, and the District of Columbia on a variety of subjects such as math, reading, and science, the NAEP allows states to compare the academic progress of its students to the progress of students in other states. What the NAEP says about Alabama’s educational competitiveness underlies the need for our citizenry to reassess the link between what is spent on public K-12 education and what we get in return for our investment.

Alabama’s rankings on the NAEP in math and reading have largely collapsed. Since 2000, rankings in math for fourth and eighth grade students fell from 35th and 32nd place, respectively, to 51st and 50th place in 2015. Reading scores for Alabama students have been more of a mixed bag. The national ranking of fourth grade students has remained flat at between 39th and 40th place, but by the eighth grade have slipped from 38th place to 46th place from 2002 to 2015.

Over the same fifteen-year period, Alabama’s expenditures on public education continue to trail the national average. Since 2000, the inflation-adjusted gap between what Alabama spends per student on education and the nation as a whole has increased, from $1,760 to $2,500 in 2014. In the 2013-2014 school year, Alabama spent $8,841 per student on public education, less than thirty-eight other states and the District of Columbia.

Simple comparisons like this make it tempting to conclude that inadequate funding is the cause of Alabama’s woeful rankings, yet the NAEP scores disprove such an explanation.

First, what Alabama spends per student on education has risen substantially in the past fifteen years. Even after accounting for the disastrous economic effects of the Great Recession, Alabama’s per-student spending increased by an inflation-adjusted 14% between 2000 and 2014. Alabama’s spending on K-12 public education totaled almost $5.7 billion, or 18% of the state’s $31 billion budget (excluding employee benefits). Yet, the state’s rankings in reading and math have not improved. Notably, over the last decade, the state spent an average of $25 million per year on the Alabama Math, Science, and Technology Initiative (AMSTI) alone.

Second, most of the eleven states that spent less per student than Alabama in 2013-2014 reported higher NAEP scores in almost every category in 2015. Specifically, all of them reported higher scores in math, eight had better scores in fourth grade reading, and ten had higher scores in eighth grade reading. Analyses conducted by NAEP in earlier years for science and writing show similarly disappointing results for Alabama.

If increased spending isn’t the key to better scores, perhaps state leaders should focus more on how education funds are allocated. Some Alabama administrators and teachers cite rigid formulas and earmarks that can handicap their ability to move additional resources directly to the classroom. Others note the state’s habit of creating new programs and initiatives year after year that must be funded to solve our problems. While well-meaning, these programs often discount the complex roots of causation and attempt across-the-board fixes rather than targeted ones. Furthermore, appropriators often fail to impose any stringent accountability when renewing funding for these programs.

The latest NAEP scores should motivate us to move beyond blaming our results on funding and focus instead on how to best use our existing resources to improve student outcomes.

This article was originally published by the Alabama Policy Institute.

3 years ago

The curious case of Alabama’s Teacher of the Year: Bureaucracy, absurdity, and perverse policy

School buses

By Andrew A. Yerbey, API Senior Policy Counsel

Ann Marie Corgill is, by all accounts and by almost any definition, a highly qualified teacher. It is regrettable that the modifier “almost” is necessary in that sentence, but its inclusion is instructive. From it, the people of Alabama can learn a lot about what ails their system of education.

More on Ms. Corgill’s story in a moment, but the Associated Press headline provides a précis: “Alabama’s Teacher of the Year Told She’s Unqualified, Resigns.”

Whether the title of “Teacher of the Year” is borne by a worthy titleholder every year in Alabama is unknown, but it certainly is in the case of Ann Marie Corgill, the reigning Alabama Teacher of the Year.

This is a woman who has practiced the art of teaching for over two decades; who has been called upon to teach other teachers about teaching; who has written a book about teaching. She went on to become a finalist—one of only four—for National Teacher of Year, regarded as the teaching profession’s highest honor.

But we know she is a great teacher not through her résumé but through her work. Ellen Anderson, her student: “Ms. Corgill is the best teacher I have ever had. She has taught us more in one year than all my other years combined. She made us feel important, empowered, and loved. . . . She is very special.” Kathy Snyder, her fellow teacher: “Ann Marie Corgill is an exemplary teacher . . . a teacher who represents the essence of our profession.” Betsy Bell, her principal: “Ann Marie believes that we can build a better world one child at a time. She is doing precisely that!”

In short, Ann Marie Corgill’s bona fides are inarguable—or so one would think. But modern bureaucrats do not think. When they were alerted this past week that Ms. Corgill lacked a certain certification, which she never had and never needed, she was deemed not a “highly qualified teacher.”

Ms. Corgill’s attempts to make sense of her Kafkaesque situation proved futile, met as they were by—to borrow her apt description—“a wall of bureaucracy.” At length, she tendered her resignation, writing regretfully: “After 21 years of teaching in grades 1–6, I have no answers as to why this is a problem now, so instead of paying more fees, taking more tests, and proving once again that I am qualified to teach, I am resigning.”

It has been well established, by over forty years of research, that the characteristics commonly found on a teacher’s résumé—such as education, certifications, and experience beyond the first few years in the classroom—have essentially no effect on a teacher’s quality. That is, how much a teacher contributes to the learning of his or her students has nothing to do with whether the teacher has a baccalaureate or doctorate, five years of experience or fifteen; and certifications certify nothing with regard to actual teaching.

Yet it is precisely, perversely, those résumé characteristics that govern Alabama’s approach to its teachers.

In Alabama, a person must minimally have a baccalaureate and a certification to be hired as a public-school teacher, and then is automatically given pay raises for having or acquiring advanced degrees and more experience. All of this is decided without inquiry into the quality of anything: not of the universities the teacher attended (the best equals the worst); not of the degrees awarded to, or the academic performance of, the teacher (majoring in education and graduating with a 2.5 grade point average equals majoring in math and graduating with a 4.0 grade point average); and, most importantly and illogically, not of the person’s ability to actually teach.

We should make it easier—not harder—for people to become teachers, and harder—not easier—for bad teachers to remain teachers.

As it stands, our system deters people who would have been great teachers from entering the profession, including both college students and mid-career professionals, and abuses great teachers already in the profession, including Ms. Corgill.

Worst of all, our system ignores the best interests of our schoolchildren, especially those most vulnerable.

At the beginning of the school year, Ann Marie Corgill had moved from Cherokee Bend Elementary School in the city of Mountain Brook to Oliver Elementary School in the city of Birmingham. She was now using her talents to teach children who are among the most disadvantaged, economically and educationally. Not anymore.

The children who just lost perhaps their last best hope at a good education will not, it seems certain, look back and take solace that a bureaucrat protected them from being taught by an “unqualified” teacher like Ms. Corgill.

3 years ago

The ‘War on Poverty’ has been an extremely expensive failure (Infographic)

Flickr user garryknight

Reagan solutions to poverty

This week the Alabama Policy Institute, a non-profit free market think tank based in Birmingham, is exploring conservative solutions to poverty. Since its implementation in the 1960s, the “War on Poverty” has cost trillions in taxpayer dollars, with less than clear outcomes.

For Friday’s installment in the series, API shared an infographic showing just how expensive, and ineffective, of a program the War on Poverty has been, and suggesting some alternate ways the government could get out of the way to relieve poverty.


3 years ago

Robertson: It’s time to consider a sensible new solution to balance Alabama’s budget

general fund education budget
Special session No. 1 wound down in essentially the same posture as the regular session did. The governor still wants tax increases. House members tried to raise taxes, while senators opted to cut their way to the $200 million needed to close the General Fund shortfall.

It’s clear that what has been offered so far does not satisfy the majority. To gain a consensus in the second special session, the Legislature needs a plan that is tolerable to more of the State House’s warring factions and that can better bring the House and Senate together.

That plan may be one that was quietly filed early in the regular session by Sen. Paul Sanford, R-Huntsville. The proposal would nearly close the General Fund shortfall without raising taxes by sharing growth revenue between the state’s two main funds. At the end of each month, this new fund would distribute recurring revenues at a proportion of 78 percent to 22 percent between the Education Trust Fund and the General Fund.

At first glance, it may almost seem simplistic, but the proposal is good policy and achieves much of what legislators claim they want to see in a budget solution.

The General Fund needs around $200 million to balance the budget. Increasing costs of Medicaid and prisons, coupled with the flat or decreasing sources of revenue assigned to this fund, ensure that it will struggle year after year. In fact, in the short time since the regular session concluded, General Fund revenues are already projected to be $17 million less than expected.

The Sanford proposal would ensure that, from now on, the General Fund receives a slightly larger share of all recurring revenues. This seems fair in light of the public’s reaction to House-proposed Medicaid cuts and Senate-proposed cuts to courts and law enforcement.

According to the Legislative Fiscal Office, the 78/22 proposal would send roughly $150 million to the General Fund for FY2016. That means that $50 million in cuts would need to be found, rather than $200 million, significantly reducing the negative impact to General Fund agencies.

The proposal tackles the underlying distribution problems that impair the General Fund, but will still require the Legislature to stay focused on controlling the costs of Medicaid and prisons. The plan is part of a long-term solution, but not the cure-all.

The same public education proponents who shut down the use tax transfer will probably react similarly to this proposal, but it is worth their consideration for two reasons. First, the 78/22 split proposal is estimated to take roughly $75 million less from the ETF than the proposed $225 million use tax transfer.

The Legislative Fiscal Office estimates that the ETF’s recurring revenue for FY2016 would go from $6.249 billion to $6.096–a decrease of only 2.44%. This decrease does not take into account a few revenue measures that were adopted during the special session to benefit the ETF. Further, the proposal would not disrupt the ETF budget that was enacted in June.

Second, for many legislators, the current shortfall has underscored the validity of consolidating the state’s two budgets. For education interests concerned about consolidation, the 78/22 proposal is far less risky, as it specifies the percentage of revenues that the ETF should receive.

The state’s receipts would not become a free-for-all, as is feared with consolidation, and education would remain the state’s top priority by a large margin. The bill also preserves the conservative Rolling Reserve Act, with the cap for FY16 reduced by the amount distributed to the General Fund.

Alabamians would surely applaud a sensible solution to the General Fund problem after being threatened with $500 million in tax increases, closed state parks or a collapsed Medicaid system. While taxpayers certainly recognize the importance of funding public education, they are also interested in adequately funding law enforcement, the courts and the district attorneys’ offices.

Given that there are plenty of appropriations from each fund for non-essential services, it is reasonable to expect the Legislature to find a way to provide these essential services without more of the taxpayers’ hard-earned money.

Sen. Sanford’s proposal is a sensible solution to the current situation. Pushing this proposal would require some courage, but it will be far easier to defend than most of the alternatives we’ve seen thus far.

Katherine Robertson is vice president for the Alabama Policy Institute. API is an independent non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families. If you would like to speak with the author, please email or call (205) 870-9900.

3 years ago

SCOTUS ObamaCare ruling will lead to health insurance premium hikes for 200k Alabamians

Had the U.S. Supreme Court ruled against the poorly-named Affordable Care Act in King v. Burwell, almost 500,000 Alabamians could have been spared the cost of the program’s individual mandate. Premiums for a healthy 21-year-old would have dropped by almost seven hundred dollars a year, and by more than two thousand dollars annually for a 64-year-old, according to estimates by the Manhattan Institute. These savings total hundreds of millions of dollars that could have been spent or invested elsewhere. However, with the ACA intact, the next phase of the law will soon be felt soon in Alabama and every other state in the nation.

First on the horizon is higher health insurance premiums for almost 200,000 Alabamians. One of the reasons Blue Cross and Blue Shield of Alabama has filed plans with the Center for Medicare and Medicaid Services and the Alabama Department of Insurance to raise premiums an average of 28% for individual plans and 13.8% for small businesses in 2016 is because the number of doctor and hospital visits made by members last year–and the attendant costs for medicine and medical procedures–was much larger and more expensive than expected. Providers like Blue Cross and Blue Shield also have to continue paying ACA fees and taxes in 2016, at a cost of about $125 million per year. Because the ACA bans insurers from charging individuals on the basis of their health risks, everyone who currently pays into the system has to pay more to cover the elderly and the sick.

As premium prices rise, full-time job openings with health benefits will become increasingly scarce. According to data from the nonpartisan Congressional Budget Office, as businesses hire fewer full-time employees and reduce the hours of hourly employees to avoid the expenses of providing health care, the pace of job creation in Alabama will slow by between 155 million and 207 million fewer job hours from 2017-2022. That’s almost $2 billion worth of paid work hours that Alabamians will lose because of the ACA.

Private-sector businesses aren’t the only ones trying to scale back costs in order to stay in business; state and local governments are also feeling the repercussions of offering decades of generous benefit plans. Starting in 2018, the Affordable Care Act’s staggering 40% excise tax will be applied to every extra dollar spent on employer-sponsored health plans deemed “too generous.” Because government health care plans cost almost 18% more on average than those in the private sector, many states are scrambling to keep their premiums under this “Cadillac tax” threshold by increasing the amount their employees pay for coverage, as well as raising deductibles, limits, and the patient cost of prescription drugs.

Spending more for health care might be easier to swallow if there was evidence that it was leading to better outcomes for the elderly and poor. Unfortunately, this isn’t true. Between 2013 and 2022, the ACA will sap $716 billion from Medicare–funds that would have gone to doctors and hospitals–to pay for other parts of the program. Faced with less revenue, health care providers will have no choice but to reduce services, shift the cost to private payers, or withdraw from Medicare altogether. The doctors in Alabama who continue to see Medicare patients will receive 21% less in reimbursements than in 2014 and almost 37% less in primary care fees for Medicaid patients. With more state-subsidized patients to see and less compensation to care for them, 57% of doctors are pessimistic about the future of medicine in America; six of every ten plans to retire early, according to a 2013 survey by Deloitte Center for Health Solutions.

The ACA’s reach even extends to life-changing medical devices. By taxing the manufacture and import of surgical tools and items such as knee and hip replacements, healthcare becomes more costly for the patients who need them to return to their formerly active lives.

While the King v. Burwell decision was celebrated as a win for the Obama Administration, the ACA’s higher costs and fewer choices in health care are bipartisan consequences. The growing left-wing opposition to the impending “Cadillac tax” signals that the law may continue to decline in popularity with its original support base as each new phase of implementation brings new awareness of the Act’s exorbitant costs.

John Hill, Ph.D. is a senior research analyst for the Alabama Policy Institute (API)

3 years ago

Robertson: For the first time in my life, I fear my freedom may be at stake (Opinion)

Flickr/Tim Cummins
Flickr User Tim Cummins
Flickr User Tim Cummins

Raised to love my country and our flag, and because it’s reserved for time with my family, the Fourth of July is a day that I look forward to from the very first signs of summer.  For me, at least, I sense that this year will be somewhat bittersweet. When we celebrate America’s independence, we necessarily celebrate freedom–unprecedented and unmatched by any other nation. For the first time in my life, I fear that my own freedom might actually be at stake.

As the left tirelessly labels as hateful anyone expressing the slightest disappointment over the Court’s ruling on marriage, any objective constitutional scholar has to admit that this decision goes well beyond the simple act of requiring that marriage licenses be issued to any couple who seeks them. Rather, it tips the scales of justice against one of our nation’s foremost freedoms: the free exercise of religion.

As you have likely read and heard numerous times over the weekend, the Court has designated the right to marry as one that is “fundamental.”  Assigning this status to same-sex marriage places it on equal footing with the free exercise of religion, a freedom enumerated in the First Amendment. Such a designation for same-sex marriage has vast implications, of course, for anyone with a religious objection to it.  Precedent dictates that government action may limit a fundamental right if the action promotes a compelling or overriding state interest. Sadly, the Court made no effort in last week’s decision to assure the protection of religious liberty in the face of this new state interest in same-sex marriage.

The majority writes, “[m]any who deem same-sex marriage to be wrong reach that conclusion based on decent and honorable religious or philosophical premises, and neither they nor their beliefs are disparaged here. But (emphasis mine) when that sincere, personal opposition becomes enacted law and public policy, the necessary consequence is to put the imprimatur of the State itself on an exclusion that soon demeans or stigmatizes those whose own liberty is then denied.”  In other words, if exercising your First Amendment rights, including that of religion, is interpreted as demeaning the fundamental right to a same-sex marriage, then your religious right will be deemed inferior.

To this end, Justice Alito did not mince words: “[The decision] will be used to vilify Americans who are unwilling to assent to the new orthodoxy. In the courts of its opinion, the majority compares traditional marriage laws to laws that denied equal treatment for African-Americans and women. The implications of this analogy will be exploited by those who are determined to stamp out every vestige of dissent.” Justice Thomas similarly opined, “[i]t appears all but inevitable that the two [rights] will come into conflict, particularly as individuals and churches are confronted with demands to participate in and endorse [same-sex marriages]. The majority appears unmoved by that inevitably.”

This new, very real threat to our previously taken-for-granted freedoms will have one of two effects on those who revere the First Amendment.  Some may decide that the current is just too strong, the left’s talking points too convincing, and that a strict adherence to the Constitution or our own religious beliefs is no longer feasible. On the other hand, and hopefully more likely, others will awaken from complacency. They will choose to be more intentional about whom they allow to influence their stances, more confident in their convictions, and more thoughtful in how they go about expressing them.

As renowned  legal scholar, Judge Robert Bork, wrote in 1993, “[i]n our current culture wars, perhaps the most important of the virtues for conservatives is fortitude–the courage to take stands that are not immediately popular, the courage to ignore the opinion polls. Otherwise, we will never change the polls. That is what true conservatism means, or it means nothing.” This Independence Day, let’s reflect on the fortitude of the generations before us who fought for our freedoms and refuse to be the apathetic generation that lets them slip away.

Katherine Robertson is vice president for the Alabama Policy Institute (API), an independent non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families.

3 years ago

Here’s how the King v Burwell ObamaCare decision could affect Alabama

ObamaCare Wheels slider
BIRMINGHAM, Ala. — Research from two influential conservative think tanks shows that many Alabamians are set to benefit to the tune of hundreds of dollars a month if the Supreme Court decides to strike key portions of ObamaCare later this week.

According to analysis by the Alabama Policy Institute (API), the plaintiffs in King v. Burwell are challenging IRS rules used to establish a federal insurance exchange (or marketplaces) under the ACA (ObamaCare). The plaintiffs allege that the federal government and the IRS do not have the authority to extend tax-credit subsidies under federal exchanges because the text of the ACA only provides for subsidies through an “exchange established by the State.”

The Heritage Foundation asserts that approximately 463,000 Alabamians could pay less for insurance if the federal ObamaCare exchanges are deemed illegal by the Supreme Court this week.

Since 2011 the Obama administration has spent nearly $5.4 billion implementing only 16 state-based exchanges; the remaining states either rely on the federally-run exchanges or partnership exchanges.

In 2014, a total of 463,525 Alabamians purchased plans, with 71,920 people receiving subsidies to offset premium costs of health insurance plans purchased through the federal exchange.

The Obama administration’s own Health and Human Services Secretary Sylvia Burwell admitted in a letter to Congress earlier this year that a ruling against ObamaCare could be the law’s undoing.

“We know of no administrative actions that could, and therefore we have no plans that would, undo the massive damage to our health care system that would be caused by an adverse decision,” wrote Secretary Burwell. During oral arguments for the case, Supreme Court Justice Anthony Kennedy also conceded that to strike down the federal exchange would cause a “death spiral” for health insurance under Obamacare.

API argues that if SCOTUS rules against the law, Congress would then have two options: go back to the drawing board with lessons learned on the disastrous impacts of this burdensome law; or negotiate a “fix” in order to preserve the ACA.

“A ruling in favor of the plaintiffs in this case would give the Republican-run Congress its first real opportunity to deliver on campaign promises to ‘repeal and replace Obamacare,'” the think tank wrote in its analysis.

Check out the infographic from API below to see how much you could save if the Supreme Court strikes down key portions of ObamaCare:

c/o the Alabama Policy Institute
c/o the Alabama Policy Institute

3 years ago

Alabama lawmakers should reform, cut, and prioritize spending (opinion)

House money tax
As the debate over Alabama’s General Fund budget shortfall continues, four schools of thought have emerged on how to solve this problem: a) tax increases, b) gambling revenue, c) unearmarking, d) and across-the-board cuts. Each one of these proposals has been deemed the obvious, simple solution to the problem, but none would actually be that straightforward. As proposed, three of the four would require the second, overlooked step of prioritizing spending–a difficult task in a currently fragmented Republican majority.

For example, if taxes are raised or gambling is expanded, where is this new revenue going to go? Assuming it goes to the General Fund, which programs or agencies will receive it? Will it be spread across the board equally or dedicated to certain services? Who will decide which functions of state government outrank the others? Except for the DOA idea of a lottery to fund Medicaid, none of these questions has a clear answer.

Unearmarking comes with the same uncertainty. To be clear, unearmarking does not generate any new money. The practice would merely give legislators more flexibility to move money around, but with the same financial obligations as before. In theory, this is a good thing as it would allow legislators to pick and choose, but will legislators suddenly be able to agree which programs should be cut and which should be funded? If the unearmarked money is not prioritized in a systematic way and no cost-saving reforms are adopted along with it, we may not end up any better off.

What about the House budget proposal that makes across-the-board cuts? That may well be where we end up at sine die, but should it be? It’s the neat and clean approach, but again, allows legislators to shirk the duty of prioritizing spending. Do all agencies and programs provide services to Alabamians that are of equal importance? Some of these agencies seem to have been neglected and set up to fail in the past only to be underfunded again this year, while others ask for more and more funding without a high degree of results-oriented accountability.

Several cost-saving options that would help alleviate the need for across-the-board cuts have been proposed by various Republicans this session. Surprisingly, most have been met with disinterest or outright opposition from their own caucus.

The current dissension in solving the budget shortfall is fueled, in part, by a lack of clearly defined priorities. There is a pressing need for leadership in the discipline of priority budgeting now, but more importantly, for the long-term. Going forward, the legislature (ideally, with help from the Executive Branch) should develop a set of fixed priorities and performance-based metrics for government agencies and offices. That way, whether there is a surplus or a shortfall in the future, there is some methodical basis on which legislators can make their spending decisions.

The ideal, yet far from simple, solution for this year would hit on a sweet spot of cost-saving reforms, targeted cuts, unearmarking certain monies, and permanently directing some growth revenue to the General Fund. An agreement of this kind could gain support if decision-making as to the specifics was based on a clear outline of what the state’s priorities should be and which services best achieve those priorities. The current supermajority has the votes to move the state beyond the status quo. Principled, conservative legislators need to rally their colleagues around such a plan that will protect Alabama taxpayers from bearing the burden of legislative discord and unclear priorities.

Katherine Robertson is the Vice President of the Alabama Policy Institute

3 years ago

Study shows Alabama taxpayers are propping up RSA to the tune of billions of dollars

An RSA tower in Mobile at night (Flickr user Steve Driskell)

An RSA tower in Mobile at night (Flickr user Steve Driskell)
An RSA tower in Mobile at night (Flickr user Steve Driskell)

BIRMINGHAM, Ala. — A new research paper from the Alabama Policy Institute (API), a free market think tank based in Birmingham, written by Auburn University professors James R. Barth and John Jahera warns of an impending shortfall in the state pension system that makes today’s general fund shortage look completely insignificant.

The study estimates that the collective Retirement Systems of Alabama (RSA)—the Teachers Retirement System (TRS), Employees Retirement System (ERS), and Judicial Retirement Fund (JRF)—have $29.4 billion in assets, and $44.6 billion in liabilities.

In short, the RSA is short for current and future retirees by $15.2 billion.

“This means that for every dollar that the pension system owes current and future retirees,” the study says, “it currently has only 66 cents.”

According to the paper, between 2003 and 2013 (the most recent years for which public data was available) the unfunded liability for the RSA grew from a manageable $2.1 billion to the $15.2 billion it is today—putting each of Alabama’s 4.8 million residents on the hook for $3,166, or $8,724 per household.

“This massive $13.1 billion increase in RSA’s unfunded liability equates to an increase of over $1.3 billion per year, $109 million each month, or nearly $4 million for each day that elected officials did nothing to fix this problem,” the paper detailed. “For a bit of perspective, the total current debt outstanding for the entire State of Alabama (every public school building,every public college or university, every road or bridge, every economic incentive, the Port Authority, Mental Health, the Revolving Loan Fund, the Tobacco bonds, all of the state’s general obligation and revenue bonds) is only about $8.8 billion or $4,786 per household.”

This year alone, the state must send nearly $1 billion to the RSA, or 12 percent of the education and general fund budgets combined, making retirement systems contributions the second largest budget item after education.

API State budget line items

The paper says that the pension reforms passed in the last several years made steps in the right direction, but did not address the fundamental issue causing the shortfall—overly optimistic returns on investment.

“The Legislature made some helpful changes to the state’s pension system a few years ago, but many of them knew that these were just ‘fixes’ and that their work wasn’t done,” API Vice President Katherine Robertson told Yellowhammer Tuesday. “Since that time, we’ve had so many conversations with legislators who are ready to take the next steps toward structural reform and have sought our input.”

“We recognize the burden that pension obligations place on our state government (and ultimately, the taxpayers) and believe that at a time where “everything is on the table,” pension reform should certainly be considered.”

Another issue the study points out is that administrators and lobbyists of the private Alabama Education Association were made eligible to receive the same pension as the state’s teachers and education staff, which is highly unusual.

Moving forward the study says the state should adopt a “Cash Balance Pension Plan,” similar to a 401k, while still making payments toward the current unfunded liability.

“Under a cash balance plan,” the paper says, “the employer continues to bear all of the investment risk as with a defined benefit plan; but like a defined contribution plan, employees establish individual retirement accounts (as opposed to an annuity under a typical pension plan). Contributions in a cash balance plan continue to come from both the employer and the employee with a minimum investment return (i.e. 5%) typically guaranteed by the employer.”

The study also recommends making changes to the Judicial Retirement Fund, which was left out of the last round of reforms. “In the State of Alabama,” the paper points out, “a person could not save a single dime for retirement, be appointed as a probate judge at age 60 (a position that doesn’t even require a law degree), serve for only 10 years until age 70 and receive a full pension (75% of salary) that would have taken a ‘regular’ state employee over 45 years to reach.”

While the paper shows how dire the situation is, it gives some hope in the conclusion, offering policy prescriptions to address the problems. Of all the crises being faced by the State Legislature, the paper makes a strong case for making tackling this issue a priority.

The entire, 39-page report can be read here.

3 years ago

Heritage Economist: Bentley should abolish state income tax, not push tax hikes

(Video Above: Heritage Foundation Chief Economist Steve Moore discusses Gov. Bentley tax hike proposal)

BIRMINGHAM, Ala. — In video for the Alabama Policy Institute (API), Heritage Foundation Chief Economist Steve Moore says Governor Bentley’s proposed tax increases are the wrong way to increase revenue for the state, and in fact will only serve to drive businesses and workers—the real sources of growth—away from the state.

“When states raise their taxes, especially when they raise their tax rates, that it actually leads to jobs leaving the state, it leads to higher unemployment, it leads to income decline in the state,” Moore said. “The problem with the Alabama budget right now is that the state is not growing fast enough, not enough jobs are being created. If you raise taxes on the business creators and on the workers, and on the investors, you’re going to get less businesses and you’re going to get less workers, and less investors. Under that kind of circumstance, you’re actually going to have higher unemployment, so I don’t get the logic behind raising taxes to try to balance the budget.”

Instead Moore recommends a structurally lower tax system, including making Alabama the 10th state to abolish the state income tax.

“The goal of Alabama should be to be more like Texas, not to be more like New York, where taxes keep going up year after year, and jobs and businesses keep leaving,” Moore quipped.

API Vice President Katherine Robertson also expressed concerns on Tuesday that the Governor’s proposed tax increases are not “dead on arrival” in the legislature, as was previously hoped.

“As the Alabama Legislature considers various proposals for closing the budget gap in our state General Fund, API continues to push for reforms to the very programs that are causing repeated budget shortfalls as an alternative to raising taxes,” Robertson said.

API is publishing two new research papers in the coming weeks, focusing on cost-saving reforms the legislature can consider in place of the Governor’s tax increases.

“Advertising higher taxes as the only option for closing the budget gap without cutting government services presents a false choice,” said API’s press release accompanying the video. “Rather, the current budget crisis should serve as an impetus for substantive reforms that tackle the real drivers behind the shortfall and will provide the state financial stability for the long-term. Alabama’s lawmakers should continue on in this worthy pursuit and stay true to their campaign promises.”

Pieces of Governor Bentley’s proposed $541 million tax increase have Republican sponsors in the legislature, but none of the tax hikes have been brought before a committee to this point. The legislature is expected to begin working on the budget next week, when they return from Spring Break.

3 years ago

The federal government props up Alabama more than almost any state in the country

According to a report released last week by the Pew Charitable Trusts, Alabama receives 36.1 percent of its annual revenue from the federal government, the ninth highest percentage in the country.

Nationwide, the ratio was down to about 30 percent, the lowest it has been since the Great Recession spurred massive growth in federal spending. But while this figure is closer to pre-recession levels, it’s still slightly higher than the 28.5 percent average for the decade proceeding the financial collapse.

Interestingly, of the top ten most federally-funded states, eight of them voted for Mitt Romney, who as the Washington Post points out, ran on a platform of scaling back the size of the federal government.

Only two of the bottom 10 voted for Romney.

WP state revs

According to Dr. John Hill, Senior Policy Analyst at the Alabama Policy Institute, there is one specific reason Alabama tends to have a relatively high amount of its revenue come from federal sources.

“The state’s poverty rate is 20% higher than the national average,” Dr. hill told Yellowhammer. “With one in every six Alabamians living in poverty, the state naturally gets more aid from the federal government. Alabama already receives about $4 billion a year in federal funds for Medicaid; this number will skyrocket if the program is expanded.”

Across the country, federal money accounted for about $500 billion of the $1.7 trillion spent by state governments.

The analysts at Pew expect the percentage to decrease further as state economies recover and recession-era stimulus dollars from the feds dry up.

But if Gov. Bentley’s rumored Medicaid expansion plan becomes a reality, Alabama could be headed in the opposite direction.

3 years ago

Alabama lottery: No-brainer budget fix, or potential plague on society?

Rep. Craig Ford, D-Gadsden
Rep. Craig Ford, D-Gadsden

BIRMINGHAM, Ala. — Alabama State Representative and House minority leader Craig Ford (D-Gadsden) announced this week that he is again sponsoring legislation that would establish lotteries in the state funding both the General and Education budgets.

“I’m going to propose two lottery bills. I’m going to do one for the education trust fund and one for the general fund. The one for the education fund will go to similar to what we call hope scholarships in Georgia,” Ford said. “It’s polling about 70 percent in all areas of the state of Alabama no matter what demographics we’re looking at. The people of Alabama want to be able to participate in a lottery. Whether they’re going to play the lottery or not, they want to participate in it.”

Governor Robert Bentley has taken gambling revenues off the table as a way to patch the looming $200-plus million hole in the state’s general fund, but has signaled in the past that he thinks the people should have the opportunity to give it their approval or veto. If any lottery legislation makes it out of the State Legislature and past the Governor’s desk during session beginning March 3rd, it would be voted on by the entire state as a constitutional amendment in November.

Ford mentioned a lottery could be more enticing this year, especially as an alternative to the increased taxes Gov. Bentley is proposing.

The last time the state voted on a constitutional amendment establishing a lottery it failed by 8 points in a vote that saw 50 percent of registered voters go to the polls.

Though support for a lottery in the state has grown increasingly vocal since then, many on both sides of the aisle remain unconvinced that a lottery would be the answer to Alabama’s funding problems.

A study by the Journal of Risk and Uncertainty found in 2008 that US households with an annual income of less than $13,000—well below the federal poverty line—spend 9 percent, or about $1,170 of their money on lotteries.

“For the desperately poor, lotteries perform a role not unlike the obverse of insurance,” an article in The Atlantic observed. “Rather than pay a small sum of money in exchange for the guarantee of protection that you’ll need in the future, you pay a small sum of money in exchange for the small probability that you’ll win money to help your lot right away. It is, for lack of a better term, a kind of aspirational insurance.”

This comparison between a lottery and “aspirational insurance” for the poor prompted former State Senator Bryan Taylor to retort on Twitter:

Dr. John Hill, senior research analyst at the staunchly anti-lottery Alabama Policy Institute, has published several articles and studies arguing that state-sponsored gambling is harmful, especially to the most vulnerable sections of the population.

“The only reason the state is flirting with a compact is because there’s money to be made—up to $60 million to help plug a $200 million hole in the state’s 2015 budget,” Dr. Hill said in a recent op-ed on the subject. “This possibility of new revenue should not be considered with blinders on as to the repercussions that can come with it. Gambling damages almost everything it touches. From increased crime rates, to addictions that last for years, to personal debt and bankruptcy, gambling is a scourge to any community that embraces it with the hope of making a fast buck.”

“There is no truth to the idea that lotteries are a ‘victimless vice’ that only exists to entertain its players while benefiting noble causes such as education,” Dr. Hill told Yellowhammer Wednesday. “The experiences of other states show that lotteries attract and entrap disproportionate numbers of the poor, minorities, underage gamblers, and the elderly.”

Even liberal publications like ThinkProgress and Salon tend to agree with Dr. Hill, worrying that implementing a lottery results in a de facto—if voluntary—tax and redistributes that money from the lower class families who tend to gamble more, to middle and upper class families who gamble less.

But in spite of the concerns, the lottery and other gambling expansions continue to be the revenue-raising plan of choice for many Democrats in the state.

4 years ago

(Opinion) Increasing gambling isn’t the answer to Alabama’s budget woes

slot machines

With spiraling mandatory spending and reduced tax revenues threatening to send one or both of the state’s budgets into proration, the options of raising additional income by establishing a compact with the Poarch Creek Indians or legalizing a state-sponsored lottery are on the minds of Alabama’s legislators. Using the refrain of “let the people decide”–the same one used by former Governor Don Siegelman 15 years ago in an attempt to legalize a Georgia-style education lottery–elected officials from Goat Hill and the Governor’s Mansion who have historically been either neutral or opposed to such possibilities now see them as a way to generate revenue for the state.

Montgomery will need plenty of revenue to keep its essential services going in 2015 given that the gap in the state’s General Fund could be as large as $200 million. In addition to the possibility of gambling revenues helping close that gap, there is a patriotic attractiveness that comes with the idea of “keeping Alabama gambling dollars in Alabama.” Likewise, gambling supporters suggest there is a sense of rightness that would come from extracting an annual toll from the Poarch Creeks in exchange for allowing them to expand their gambling operations in the state. Sanctioning either of these ideas, though, may not produce the long-term, stable economic benefits legislators are counting on.

First, gambling is not a “fix” for any state’s economy. Despite the liberal use of “millions” (and even “billions” in some larger states) by gambling supporters to describe the monetary benefits of legalizing casinos or a lottery, the amount of tax revenue that legalized gambling provides to states is relatively small. According to a 2010 report by the Rockefeller Institute, gambling-related revenues accounted for only 2.1% to 2.5% of total revenues between 1998 and 2009 for states with large-scale gambling.

Alabama should expect nothing different if it legalizes casinos or a lottery. If a compact was established with the Poarch Creeks that gave the state 10% of the tribe’s casino revenues–which totaled $600 million in 2012–the $60 million that would be generated would pay for only 3.2% of the state’s $1.8 billion General Fund budget. If the money was earmarked for schools, it would amount to only one percent of the state’s Education Trust Fund, just enough to pay for 3.7 days of public education.

In the same way, lotteries add very little to the bottom line of most states. According to the annual financial reports of lotteries in 2012, revenues from the average lottery covered about 3.6% of total state government expenditures. The actual benefit of lottery revenues offsetting essential state spending is even smaller than this, as several states earmark large amounts of lottery revenues to college scholarship programs and other beneficiaries not otherwise covered by their General Fund.

Second, gambling is not a stable source of revenue for states, as neither lotteries nor casinos are recession-proof. From the beginning of the Great Recession in 2008 to 2012, the typical lottery state saw the amount of lottery-generated revenues transferred to the state decline for an average of two years, with sixteen states reporting declines for three or more years. Similar losses in gambling-related tax revenue occurred in the same five-year period in the twenty states with either land-based, riverboat, or racetrack casinos, with seven states having yet to recover to their 2008 tax revenue levels. Moreover, because Alabama’s per-capita income is lower than the national average, fewer dollars could be expected to be played at gambling venues.

Even the Poarch Creeks admit they cannot expect to live off of gambling revenues forever. In the words of Tim Martin, the President/CEO of the Creek Indian Enterprises Development Authority, “We work with the philosophy that gaming is going away–a little bit every day.” If the most adamant supporters of casino gambling in Alabama are diversifying in anticipation of the day that gambling revenue will end, why should the Legislature believe that legalized gambling will provide a steady source of income?

Finally, the market for large-scale gambling in the United States is already swamped. With 95% of Americans already living in lottery states, and most living within a few hours’ drive of one or more of the 979 casinos scattered across the country, there is no reason tourists would come to Alabama to gamble. Only local income will be captured. Moreover, if casinos or a lottery were legalized to prevent Alabamians from gambling at venues in neighboring states, it would be an admission that it is Alabamians the gambling interests want to prey upon.

Advertising expanded gambling or a statewide lottery as a short-term solution for Alabama’s budget woes is disingenuous. Any gambling revenues realized by the state would constitute only a fraction of what is needed to close the gap in next year’s budget, and then only if the economy continued to improve. The conservative leadership in Montgomery which was solidly reelected only a few days ago should reject this attempt at a quick fix and consider other measures that both reign in spending and cut unnecessary costs over the long term.

John Hill, Ph.D., is senior policy analyst for the Alabama Policy Institute (API), an independent non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families. If you would like to speak with the author, please call (205) 870-9900 or email him at

4 years ago

(Chart) For the first time in decades, Alabama’s government is actually shrinking

YH Dont Tread on Me Flag

Alabama Governor Robert Bentley was elected in the great Tea Party wave of 2010, an election cycle when the calls for reductions to the size of government were louder than ever. The first-term governor responded with a plan he dubbed the “Road to a Billion Dollars in Savings,” which sought to “right size” Alabama’s state government.

A study released earlier this year found that of the 26 new governors elected nationwide in 2010, Bentley has managed to reduce the size of his state’s bureaucracy at the third fastest pace.

But although Bentley has thus far charted a fiscally conservative path for the state, it is the Republican-controlled Legislature — elected in 2010 after 136 years of Democratic control — that has carried the bulk of the responsibility for making cuts.

And as Republican legislators around the state try to beat back challenges from AEA-backed Democrats, the chart below provides pretty compelling evidence that when it comes to changing the direction of Alabama’s previously-expanding bureaucracy, Republicans have delivered. (I actually considered titling this article “The chart that every Alabama Republican wants you to see”).

In this chart, which includes data compiled by the Alabama Policy Institute (API), it’s easy to see the course correction that took place after the 2010 elections. After decades of Alabama’s budgets increasing in terms of real dollars, inflation-adjusted dollars and as a percentage of GDP, the state’s spending has decreased by all three of those measures since the GOP took control.

Alabama state budget

Here’s API’s more detailed explanation of data contained in the graph:

In fiscal year 2014, Alabama’s combined state and local expenditures totaled $41.7 billion, up $26.7 billion since 1992 ($20 billion in inflation-adjusted dollars). Since 1992, Alabama’s total state and local expenditures have increased 177% (78% after adjusting for inflation).

In 1992, Alabama’s combined state and local budget of $15.1 billion equaled about 19$ of the state’s gross domestic product (GDP) of $83.1 billion. By 2013, the estimated budget of $41.7 billion was 21% of the state’s GDP of $198 billion.

In 2014, the three largest components of Alabama’s state and local budgets were education (31%), health care (28%) and pensions (8%).

“Alabamians elected us to make state government more efficient and live within our means without raising taxes or cutting essential services,” Gov. Bentley said earlier this year. “State government was broke when Republicans entered office in 2011, but together with Legislative leaders, we took a serious look at how we could find savings in state government.”

“When Republicans took over the Legislature for the first time in 136 years, we promised to make tough decisions and live within our means, just like every household in Alabama, and we’ve taken that vow seriously,” added House Speaker Mike Hubbard. “I’m proud of our success to date, but we are continuing our efforts to streamline and right-size government without raising a single dime of taxes.”

And as Hubbard suggested, there are definitely opportunities to continue the streamlining efforts.

For instance, Alabama continues to have a relatively high number of state employees compared to its population. The Yellowhammer State currently has one state employee for roughly every 47 residents.

But for now, the GOP would be smart to tout the chart above as evidence that they’ve at least started to give Alabamians what they want — a smaller, less intrusive state government bureaucracy.

Follow Cliff on Twitter @Cliff_Sims

4 years ago

More belt-tightening is needed in Alabama’s budgets (opinion)

Alabama State House (Photo: Creative Commons/Jay Williams)
Alabama State House (Photo: Creative Commons/Jay Williams)

(This is Part 2 of the Alabama Policy Institute’s 3-part “Budget Basics” series: exploring Alabama’s budget system, the current fiscal climate and related challenges, and the implications for taxpayers. Part 1 can be read here.)

The Alabama state budget process begins with the Alabama Department of Finance’s Executive State Budget Office (EBO), as required by Alabama law. The EBO puts together the Governor’s Executive Budget and presents it to the Legislature. The Legislature reviews the Governor’s budget and drafts its own, with assistance from the Legislative Fiscal Office (LFO). The two appropriations bills then go through the typical legislative process, starting with consideration by the relevant committees: the Senate Committee on Finance and Taxation- ETF, the Senate Committee on Finance and Taxation-GF, the House Ways and Means Education Committee, and the House Ways and Means General Fund Committee.

The Governor’s proposed FY2015 General Fund budget was not substantially altered as it made its way through the legislative process. The Governor recommended $1.82 billion and a $1.83 billion budget was enacted. On the other hand, the Senate reduced by $75 million the Governor’s $5.99 billion proposal for the ETF, while the House version decreased the appropriation by around $60 million (which was adopted). The main source of disagreement was the Governor’s inclusion of a 2% pay raise for K-12 educators at a cost of $68 million and a $72 million increase for education employee insurance. If both of these items had been adopted, the ETF’s statutory spending cap would have been exceeded by $92 million. The Legislature opted to focus resources on the education health insurance without providing for a pay raise, and exceeded the cap by a much smaller margin. On April 11, 2014, the Governor signed the FY15 budget, allocating $1.8 billion to the General Fund (up 5.1% from last year) and $5.9 billion to the Education Trust Fund (up 2.9% from last year).

Simply put, it has become more and more difficult to maintain level funding, much less increased funding, for all of the obligations of state government.

As previously mentioned, the Alabama Constitution requires a balanced budget. Proration is declared when revenues from income, sales and other taxes fall short of estimates and across-the-board cuts are implemented, or prorated.

Since 1980, the State has declared proration 11 times for the Education Trust Fund and eight times for the General Fund. In the last decade alone, the ETF went into proration six times and the GF three times. Notably, since the Republicans took power, the ETF has not gone into proration, because the 2011 adoption of the Education Rolling Reserve Act (ERRA) caps the appropriation limit. Proration was declared for the General Fund in 2012. Poor stock market conditions and tornado recovery funds were cited as contributing factors.

In some fiscal years, to avoid proration or to reduce its impact, money has been borrowed from the State rainy day accounts. The rainy day accounts, one for the ETF and one for the GF, are part of the Alabama Trust Fund. The Alabama Trust Fund was established in 1985 and is funded by the State’s oil and gas revenues. In 2008, the ETF and GF Rainy Day Accounts were set up within the Trust fund.

There are constitutional limits on how much money can be withdrawn in a particular fiscal year. Most recently, in 2009, the maximum withdrawal–$437 million–was made from the Education Rainy Day Account. The ETF must fully repay the remaining balance of $162 million by July 2015. In FY2010, $161 million was withdrawn from the General Fund Rainy Day Account. At present, there is no set schedule for repayment but it must be repaid by 2020. In September 2012, voters approved a constitutional amendment to withdraw $437 million from the Alabama Trust Fund over the course of three years to make up for General Fund shortages. When the Legislature reconvened in 2013, a bill sponsored by Sen. Taylor (R-Prattville) and former Rep. Love (R-Montgomery) was passed to require an automatic payback of this withdrawal by 2026.

The Alabama economy continues to experience stagnant economic growth. Simply put, it has become more and more difficult to maintain level funding, much less increased funding, for all of the obligations of state government. Republican-led efforts in the last quadrennium to pass legislation limiting ETF spending according to past growth, consolidating agencies or offices, streamlining a variety of operations, and ensuring the repayment of debts owed to the various savings funds are a solid step in the right direction.

As it currently stands, more ‘tightening of the belt’ will be required. Providing for more flexibility in the allocation of resources will be another necessary consideration.

Katherine Green Robertson is senior policy counsel for the Alabama Policy Institute (API), an independent non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families. If you would like to speak with the author, please call (205) 870-9900 or email her at katheriner(at)

4 years ago

Budget Basics: the facts about Alabama’s budget system

Alabama State Capitol
Alabama State Capitol

Many taxpayers are familiar with the federal budgeting system, thanks to incessant coverage of budget standoffs, government shutdowns, and increasing national debt. Yet many Alabamians remain completely unfamiliar with Alabama’s budget and the budgeting process. When the Legislature convenes in March, leadership will face the daunting task of balancing the FY2016 budget at a time when the long-term budget outlook is bleak.

It’s imperative that Alabama taxpayers understand how the process works, where the money goes, and what challenges the State is facing. The general public, particularly those in the private sector, commonly feel disconnected with or ambivalent toward budget debates at the state or federal level. Recent talk of tax increases will likely stir interest in this complex topic, so let’s start with the basics.

The most unique thing about Alabama’s budget is that it was split into the General Fund (GF) and the Education Trust Fund (ETF) when public education began in 1927.  Currently, only three states maintain two separate budgets.

The ETF primarily funds K-12 education and higher education and includes salaries and benefits for teachers, administrators, and support staff.  The ETF receives 52% of the State’s overall appropriations and is predominantly funded by revenues from state income and sales taxes.

The GF covers nearly everything else, such as the operation of the executive, legislative, and judicial branches of state government, public safety, and Medicaid. The GF is financed by tax revenue such as the ad valorem and insurance premium taxes; however, this fund receives only 15.9% of the State’s total appropriations per fiscal year. (Note: The 32% that doesn’t go into either of the two major funds will be discussed in a later installation.) In April 2014, the State enacted a budget for fiscal year 2015 of which $1.8 billion was allocated for the GF and $5.9 billion for the ETF.

Thirty-five percent of GF appropriations are directed to the State’s Medicaid obligations and twenty-two percent is directed to corrections. The proportion of the State budget devoted to these two commitments explains (at least in part) the ongoing attention given to Medicaid expansion and prison reform. According to the Legislative Fiscal Office, funding for Medicaid and corrections has increased from 34% of the GF in 1984 to 57% in 2014.  Estimates from The Heritage Foundation show that if Medicaid were expanded in Alabama, it would cost the State between $470 million to $693 million from 2014-2019. Furthermore, according to the Council of State Governments, Alabama would need $840 million just to build enough prison space to account for the current overcrowding.

Taxpayers will need a better understanding of Alabama’s budget and the current fiscal climate in order to actively engage policymakers in upcoming budgeting decisions that will have long-term consequences for the State.

Annually, the Legislature’s “paramount duty” is to approve the State’s budget for the upcoming fiscal year. Alabama’s Constitution requires that the State pass a balanced budget and an amendment adopted in 1933 requires the proration—or across the board cuts–of State funds when revenues received are less than the monies appropriated. This is similar to the 2013 sequestration, or automatic across-the-board spending cuts, at the federal level that captured headlines.  The State experienced proration fairly regularly during the last decade, due to steadily increasing expenditures combined with stagnant economic growth. (Editor’s note: the state has not, however, experienced proration since Republicans took the majority in the Legislature in 2010.)

Alabama’s budget is also distinctive because about 88% of Alabama’s tax revenue is earmarked, whereas the average state earmarks about 25%.  This means that 88% of revenues collected are already obligated to specific sources by statute or constitutional amendment, not the “bridge to nowhere” or “big dig” type earmarks that you hear about from Washington. This leaves roughly 12% of total state funds to be allocated for current needs. The Governor and some legislative leaders have recently expressed openness to removing some earmarks to provide greater flexibility and discretion in appropriating funds.

Taxpayers will need a better understanding of Alabama’s budget and the current fiscal climate in order to actively engage policymakers in upcoming budgeting decisions that will have long-term consequences for the State.  Parts 2 & 3 of our Budget Basics series will explore in more detail the heaviest obligations of our state budget, what challenges the Legislature will face next session, and which options for reform are on the table.

Katherine Green Robertson is senior policy counsel for the Alabama Policy Institute (API), an independent non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families. If you would like to speak with the author, please call (205) 870-9900 or email her at katheriner(at)

4 years ago

Top 10 most business-friendly cities in Alabama

Millbrook, Ala.
Millbrook, Ala.

The Alabama Policy Institute, a conservative think tank located in Birmingham, Ala., just released their annual list of the most business-friendly cities in Alabama, and it contains a few surprises.

“In order for Alabama to excel in an increasingly competitive global marketplace, Alabama must be as attractive as possible to businesses looking to establish or grow operations in the state.” API explains in the introduction to their list. “This report looks at a number of factors: What cities have the best tax policy? Which have low costs of living and crime rates? What cities have experienced the most year-over-year population and job growth. What type of economic vitality do cities have, including the average incomes for local residents? API answers those questions in this report.”

After digging into the data, Millbrook, Ala., emerged as the most business-friendly city in the state.

Located in Elmore County, Millbrook finished 4th in both Economic Vitality and Business Tax Burden categories, 34th in Community Allure and 7th in the category of Transportation Infrastructure, for a composite score of 75.62 out of 100 possible points. That’s a 4.67 point jump from Millbrook’s score last year.

Prattville, located in Autauga County, came in a very close second with a score of 75.46, a massive 10 point spike over the last 12 months. Prattville’s outstanding rankings in Community Allure (2nd), Transportation Infrastructure (5th) and Business Tax Burden (6th) are helping the city attract residents who are both educated and employed.

Foley, located in Baldwin county finished in 3rd place, thanks in large part to its #1 ranking in the Business Tax Burden category. It was held back by its below-average standardized test scores in the Alabama Reading and Math Test (22nd) and its low Transportation Infrastructure rank (42nd).

With the exception of Montgomery (#8), the Top 10 is noticeably devoid of Alabama’s most well-known and largest cities. That’s mainly due the the high tax burden in Alabama’s major metros, especially Birmingham.

But the job-killing policies of some of the state’s biggest cities can’t compare to the nightmare of trying to operate a company in Alabama’s least business-friendly city, Selma.

API explains:

Selma’s next-to-last showing in Economic Vitality is the result of growing unemployment, a shrinking population, and one of the lowest per-capita incomes in Alabama. An equally low score in Community Allure is the product of Selma having a violent crime rate almost two-and-a-half times the average of the municipalities surveyed in this report. Education outcomes are also depressed, with the lowest proportion of students in the state scoring well on standardized tests. The city’s workforce is also less prepared than much of the rest of the state, with significantly fewer adults age 25 or older possessing a high school diploma or better. To its credit, the cost of living in Selma is substantially below the state average, but this was not enough to keep the city from being the worst for business in Alabama.

So without further ado, here are the top 10 most business-friendly cities in Alabama:

1. Millbrook
Overall score: 75.62
Economic vitality: 78.70
Business tax burden: 81.02
Community allure: 51.72
Transportation infrastructure: 89.51

2. Prattville
Overall score: 75.46
Economic vitality: 68.41
Business tax burden: 80.33
Community allure: 69.66
Transportation infrastructure: 89.90

3. Foley
Overall score: 74.91
Economic vitality: 78.06
Business tax burden: 91.47
Community allure, 55.73
Transportation infrastructure: 60.04.

Sunset in Foley, Ala.
Sunset in Foley, Ala.

4. Daphne
Overall score: 69.42
Economic vitality: 64.14
Business tax burden: 76.06
Community allure: 63.64
Transportation infrastructure: 76.14

5. Cullman
Overall score: 69.26
Economic vitality: 59.48
Business tax burden: 86.74
Community allure: 61.87
Transportation infrastructure: 66.98

6. Helena
Overall score: 68.30
Economic vitality: 78.12
Business tax burden: 48.37
Community allure: 71.57
Transportation infrastructure: 80.92

7. Troy
Overall score: 67.19
Economic vitality: 66.83
Business tax burden: 80.56
Community allure: 53.23
Transportation infrastructure: 59.92

Troy University football stadium (Photo: Henry Otto)
Troy University football stadium (Photo: Henry Otto)

8. Montgomery
Overall score: 63.90
Economic vitality: 46.95
Business tax burden: 75.12
Community allure: 53.76
Transportation infrastructure: 94.55

Montgomery, Ala. (Photo: John Tracy/Flickr)
Montgomery, Ala. (Photo: John Tracy/Flickr)

9. Fairhope
Overall score: 63.42
Economic vitality: 53.21
Business tax burden: 78.47
Community allure: 54.55
Transportation infrastructure: 68.96

10. Pell City
Overall score: 62.85
Economic vitality: 76.44
Business tax burden: 45.45
Community allure: 59.09
Transportation infrastructure: 70.99

What do you think about the list? Do you agree? Let us know in the comment section below or by tweeting @YHPolitics.

Follow Cliff on Twitter @Cliff_Sims