2025 Alabama BluePrint Report

Occupational Licensing

Background

As of November 2024, Alabama had a labor participation rate of 57.6%, one of the lowest in the nation (1). In practical terms, that means that more than 42% of Alabama’s working-age population has chosen to leave the workforce and have not actively sought a job in at least 30 days.

One of the biggest barriers to entering the state’s workforce is occupational licensing. According to a 2018 report from the Alabama Policy Institute (API), Alabama ranked 47th in the country in terms of having the most burdensome occupational licensing laws (2).

1 Alabama Department of Labor, “Alabama’s Labor Force Participation Rate Unchanged at 57.0%”, Press Release, November 15,2024, https://adol alabama gov/2024/11/alabamas-labor-force-participation-rate-increases-to-57-6/#:~:text= Alabama's%20Labor%20Force%20Participation%20Rate,57.6%25%20%2D%20Alabama%20Department %20of%20Labor.

2 Daniel J Smith, Courtney Michaulk, David Hall, and Alex Kanode, “The Costs of Occupational Licensing in Alabama”, Alabama Policy Institute, 2018, https://alabamapolicy.org/wp-content/uploads/2020/10/Cost-of-Occ-License.pdf.

Alabama licenses 151 occupations, covering nearly half a million workers. Sixty-three of the licensing requirements fall on low-income workers.

This includes occupations such as barbers, shampoo assistants in salons, manicurists, and security alarm installer helpers. There are twelve occupations that require a state license just to serve as an apprentice, intern or trainee3 .

Besides the sheer number of occupational licenses required by the state, the costs of obtaining those licenses are burdensome for many individuals, particularly low-wage earners. Initial licensing fees can exceed $1,000 and numerous state licensing boards require annual renewals. API’s 2018 report found that combined license and renewal fees totaled an estimated $167 million annually. Continuing education requirements added an additional $243 million to the annual costs for licensees (4).

Aside from the costs to individuals, Alabama’s strict occupational licensing requirements come at a large economic cost. According to a study conducted by the Institute for Justice, Alabama loses almost 21,000 jobs

3 Ibid.

4 Ibid.

per year due to occupational licensing requirements, and the economic impact of those job losses is $1.88 billion annually (5).

What Reforms Should Lawmakers Pursue in 2025?

Prohibit State Agencies and Occupational Licensing Boards from Silencing Whistleblowers

When an employee sees conduct that is inappropriate or illegal occurring at their workplace, they should have the ability to disclose that information publicly, without being silenced by their employer or having fear of retaliation.

Section 25-8-7 of the Code of Alabama offers some protection for whistleblowers, stating that they cannot be discriminated against for refusing to take part in or exposing illegal activities. It further says that no

5 Morris M Kleiner and Evgeny Vorotnikov, “At What Cost? State and National Estimates of the Economic Costs of Occupational Licensing”, Institute for Justice, November 2018, https://ij.org/wp-content/uploads/2018/11/Licensure Report WEB.pdf.

employer, agent of an employer, or any other person can fire, discipline, threaten, harass, blacklist, or in any other way discriminate against current and former employees for disclosing nonprohibited information or refusing to obey illegal orders6 .

What current law does not do is prohibit agencies and licensing boards from entering into Non-Disclosure Agreements with employees or paying them to remain silent about questionable activities and practices.

The Legislature should ensure that this right is statutorily protected.

Conduct a Thorough Assessment of Current Occupational Licenses

The legislature should conduct a thorough review of current occupational licenses. Lawmakers should ensure that unnecessary requirements or excessive costs are not a prerequisite for licensing.

They should determine if removing a currently required license would create a threat to public safety. Alabama should delicense any occupation with no demonstrable consumer safety or health concerns. In determining what professions should be eligible for de-licensing, Alabama lawmakers could look to other states in the Southeast and determine what professions Alabama currently licenses that those states do not (7).

Part of any review of occupational licensing should include a thorough examination of the costs of licensure for existing licensees. Lawmakers should ensure that licensing costs are not unreasonable or unnecessary, particularly when compared to neighboring states (8).

Consolidate State Occupational Licensing Boards

During the 2023 Regular Legislative Session, Senator Chris Elliott introduced Senate Bill 156, which would have created the Occupation Licensing Board Division within the Alabama Secretary of State’s Office. Among other provisions, the bill would have established standardized rules for the examination and licensure of applicants, standards for determining

6 See Section 25-8-7, Code of Alabama.

7 Daniel J. Smith, Courtney Michaulk, David Hall, and Alex Kanode, “The Costs of Occupational Licensing in Alabama”, Alabama Policy Institute, 2018, https://alabamapolicy.org/wp-content/uploads/2020/10/Cost-of-Occ-License.pdf.

8 Ibid.

licensure fees, and provided uniformity in the collection of fees, fines, and other money dure to the licensing division (9).

There is a considerable cost to the state to compensate private management groups to administer state licensing boards. Many of Alabama’s occupational boards are administered by professional management companies, several of which manage as many as 15 boards and commissions at a cost to the state of more than $1.5 million per company. Numerous questions have been raised by lawmakers as to how well these management companies are doing their job and the high costs to the state for their services (10).

According to the Legislative Services Agency’s fiscal note of Senate Bill 156, consolidating all of Alabama’s licensing boards under the Secretary of State’s Office would cost taxpayers approximately $2.6 million per year, all, or part of which would be offset by licensing fees (11).

Adopt Universal Occupational License Recognition

Occupational licensing regulation can be particularly burdensome for new or temporary residents of Alabama. Universal license recognition would make it easier for those people to contribute to Alabama’s workforce.

As of late 2023, 20 states, including Mississippi and North Carolina, had adopted some form of universal license recognition. Universal recognition states waive licensing requirements if an applicant already holds a license in good standing from another state. Applicants are barred from having pending disciplinary action before their home licensure boards nor can they have a criminal record that would prohibit them from obtaining a license in the recognizing state (12).

While universal licensing recognition does not address the issue of whether all of Alabama’s current occupational licensing requirements should exist, it

9 See Sente Bill 156, Alabama Legislature 2023 Regular Session.

10 Mary Sell, “Once sleepy Sunset meetings now have ‘different attitude’”, Alabama Daily News, August 21,2023, https://aldailynews.com/once-sleepy-sunset-meetings-now-have-different-attitude/, (accessed December 19, 2023).

11 See Legislative Service Agency Fiscal Division Fiscal Note for Senate Bill 156, Alabama Legislature 2023 Regular Session.

12 Institute for Justice, “Universal Recognition for Occupational Licensing”, 2023, https://ij.org/legislative-advocacy/states-reforms-for-universal-recognition-of-occupational-licensing/, (accessed December 19, 2023).

does make it easier and, in some cases, less costly for people moving from another state to find employment.

Conclusion

Occupational licensing imposes substantial costs on Alabamians in terms of reduced occupational mobility, reduced entrepreneurship, higher unemployment, and higher consumer prices. The negative effects of occupational licensing on employment and entrepreneurial opportunities suggest that over-licensure may also be, in part, responsible for the low labor participation rate and relatively low rate of entrepreneurship in Alabama.

Tax Cuts

Background

In fiscal year 2024 Alabama collected more revenue from taxpayers than at any point in state history, a combined $14.115 billion last year (1).

After experiencing historic growth over the past several years (79.8% from 2014-2023) ETF revenue growth increased by 2.12% ($221 million) over last year ’ s $10.428 billion in net revenue. The largest contributor to the increase in net ETF revenues was that the state collected approximately $235 million more in combined individual and corporate income tax receipts in 2024 than the previous year. Corporate and Individual income tax receipts are the largest source of ETF revenues. The state’s general sales and use tax receipts decrease by approximately $60 million in 2024 (2).

1 See open alabama gov, State of Alabama Accounting and Resource System, “Comparative Summary of Revenues by Fund”, October 1, 2024.

2 Ibid.

Meanwhile, the much smaller GF budget continued to see strong revenue growth of 7.02% in 2024, bringing in an additional $227.3 million compared to 2023. The largest component of the surge in GF revenue was due to a $104.8 million increase in interest income from state investments and a $49.5 million (8.9%) increase in insurance premium tax receipts (3).

Despite slower ETF growth than in recent years, the fund still ended FY 2024 with a projected balance of nearly $1.9 billion. The GF was projected to have a surplus of more than $539 million as the new fiscal year began (4).

Rather than increasing fiscal year 2025 or 2026 spending levels, lawmakers should use the state multibillion-dollar surplus to reduce the future tax burden of all Alabamians.

Current Law

In Alabama, all income earned by an individual is taxable. For single filers, the first $500 in income is taxed at 2%, the next $2,500 is taxed at a rate of

3 Ibid.

4 Alabama Legislative Services Agency, “State General Fund Budget Conditions and Outlook”, August 13, 2024, https://alison.legislature.state.al.us/files/pdf/lsa/Fiscal/BudgetHearings/2024-summer/LSA-2.pdf.

4%, and all earned income above $3,000 is taxed at a 5% rate. The minimum personal tax exemption for a single filer is $1,500 per year (5).

For married filers, the personal exemption is a minimum of $3,000 per year. After that, married person filing a joint return pay 2% taxes on the first $1,000 earned, 4% on the next $5,000 in wages, and 5% for all earned income above $6,000 per year (6).

While many of the nation’s lawmakers have used historic state revenue surpluses to pursue historic individual income tax relief over the past few years, Alabama has lagged behind. Alabama is already at a competitive disadvantage in attracting new residents to the state compared to Tennessee and Florida, which levy no individual income taxes. Our neighbors in Georgia and Mississippi have also enacted historic income tax cuts over the past few years, with Mississippi Governor Tate Reeves pledging to continue his push to eliminate all state individual income taxes before the end of his tenue in office (7).

5 Alabama Department of Revenue, “Individual Income Tax”, https://www revenue alabama gov/tax-types/individual-income-tax/

6 Ibid.

7 Justin Bogie, “Lowe taxes, better education are keys to attracting business to Alabama, not incentives”, Alabama Today, October 4, 2022, https://altoday.com/archives/47571-justin-bogie-lower-taxes-better-education-are-keys-to-attracting-bu siness-to-alabama-not-incentives, (accessed December 18, 2023).

In terms of corporate income taxes, all annual net income is taxed at a rate of 6.5%. Deductions are allowed for all federal income taxes paid or accrued (8). On paper, Alabama has one of the highest corporate income tax rates in the Southeast, ranking ahead of Georgia, Florida, Mississippi, South Carolina, North Carolina, and Kentucky (9).

In practice, Alabama’s effective tax rate is lower than the 6.5% statutory rate because Alabama allows businesses to deduct federal taxes paid from their state tax bills. However, as was seen after the passage of the federal Tax Cuts and Jobs Act of 2017 (TCJA), this can cause unpredictability for the state’s businesses and government. Because the TCJA reduced federal corporate income tax rates, businesses had less to deduct from their state

8 Alabama Department of Revenue, “Corporate Income Tax”, https://www.revenue.alabama.gov/tax-types/corporate-income-tax/.

9 Janelle Fritts, “State Corporate Income Tax Rates and Brackets for 2023”, Tax Foundation, January 24, 2023, https://taxfoundation.org/data/all/state/state-corporate-income-tax-rates-brackets-2023/, (accessed December 18, 2023).

income tax rates, meaning that their Alabama tax bills increased10 . From 2019-2023 net corporate income tax collections increased by 166% (11).

With many of the provisions of the TCJA set to expire at the end of 2025, Alabama’s effective corporate income tax rate will be lower than the 6.5% statutory rate and below many Southeastern states. However, having a higher statutory rate than neighboring states puts Alabama at a competitive disadvantage in attracting new businesses.

Beyond individual and corporate income tax reforms, Alabama lawmakers should build on the progress of the past few years and continue to find ways to further reduce the tax burden of Alabamians.

Suggested Tax Reforms

10 Justin Bogie, “Halfway through the legislative session, what have lawmakers done?”, Alabama Today, March 25, 2021, https://altoday.com/archives/39601-justin-bogie-halfway-through-the-legislative-session-what-have-law makers-done, (accessed December 18, 2023)

11 Alabama Legislative Services Agency Fiscal Division, “A Legislator’s Guide to Alabama’s Taxes”, March 2024, https://alison.legislature.state.al.us/files/pdf/lsa/Fiscal/TaxGuide/2024 Tax Guide.pdf.

Reduce Individual Income Tax Rates

During the 2023 Regular Legislative Session, Representative Danny Garrett (as well as Senator Arthur Orr) introduced several proposals to reduce the state’s individual income tax burden.

House Bill 115 would have reduced the state’s top income tax bracket from 5% to 4.95% over a five year phase in period, saving an estimated $57.3 million once fully implemented (12). An accompanying bill (House Bill 116) would have eliminated the state’s 2% tax bracket, eliminating income taxes on the first $500 and $1,000 earned for single and married filers respectively. Estimated savings from this proposal were $25 million per year (13). No similar proposals were introduced during the 2024 regular session.

Lawmakers should build on these proposals and consider moving towards a flat tax rate of 3.95%. Both Georgia and Mississippi have enacted legislation to utilize a flat income tax structure and reducing Alabama’s rate to 3.95% would make Alabama’s rate the lowest in the region, besides states that assess no state income tax.

Reduce Corporate Income Tax Rate to Improve Competitiveness

In the COVID-19 shortened 2020 regular session, Senator Dan Robets and Representative Danny Garrett introduced bills that would have reduced the state’s statutory corporate income tax rate from 6.5% to 4.75%. The bills would have also eliminated a corporation’s ability to deduct federal income taxes paid from their Alabama tax bills (14).

In terms of a company ’ s bottom line, reducing the tax rate to 4.75% is unlikely to have a significant impact on the amount of taxes owed each year. However, it would make tax bills more predictable since they would no longer be tied to the federal tax code.

Reducing the corporate income tax rate would also make Alabama more competitive in attracting new businesses and industries to the state. As stated previously, Alabama has one of the highest statutory corporate income tax rates in the Southeast.

12 See House Bill 115, Alabama Legislature 2023 Regular Session

13 See House Bill 116, Alabama Legislature 2023 Regular Session.

14 See Senate Bill 249, Alabama Legislature 2020 Regular Session.

According to a 2020 report from the Joint Legislative Task Force on the Tax Cuts and Jobs Act, “Alabama gets little to no credit for its lower effective tax rates resulting from the FIT (Federal Income Tax) deduction. We are advised that it is a meaningful competitive disadvantage in state comparisons by economic developers and companies looking to locate in the Southeast. Alabama will never know how often it has been “deselected” in a business location decision because it is perceived to have one of the highest corporate income tax rates in the Southeast (15).”

Fully Repeal Business Privilege Tax

Alabama’s business privilege tax is a state government fee levied for the privilege of being organized under the laws of Alabama or doing business in the state. It is assessed as a percentage of a company ’ s net worth with rates ranging from 0.025% to 0.175%, however, prior to tax year 2023, every business organized in the state was required to pay a minimum privilege fee of at least $100 each year (16).

During the 2022 regular session, Alabama lawmakers repealed the minimum privilege tax, with the change being fully implemented during the 2024 tax year. The repeal will save businesses an estimated $23 million each year beginning in 2024 (17).

No company should be required to pay the state a fee purely for the privilege of doing business within Alabama’s borders. Lawmakers should continue to pursue a full repeal of the tax, saving Alabama businesses more than $200 million each year (18).

Permanently Extend Overtime Tax Exemption

In 2023, Representative Anthony Daniels championed the first in the nation repeal of state income taxes on earned overtime wages. This

15 Joint Legislative Task Force on the Tax Cuts and Jobs Act, “Final Report”, February 18, 2020, https://www.bcatoday.org/wp-content/uploads/2020/03/JTF TCJA final Report.pdf.

16 Ashley G. White, “Alabama to Phase out Minimum Business Privilege Tax Beginning in 2023”, BMSS Advisors and CPAs, June 15, 2022, https://www.bmss.com/alabama-to-phase-out-minimum-business-privilege-tax-beginning-in-2023/, (accessed December 18, 2023).

17 See House Bill 391, Alabama Legislature 2022 Regular Session

18 Alabama Legislative Services Agency Fiscal Division, “A Legislator’s Guide to Alabama’s Taxes”, March 2023, https://alison-file.legislature.state.al.us/pdfdocs/lsa/Fiscal/TaxGuide/2023 Tax Guide.pdf.

innovative approach to tax reform will encourage Alabamians to work longer hours and could help fill the state’s labor shortage as well as boost Alabama’s lagging labor participation rate. The overtime tax repeal saved taxpayers an estimated $230 million during the first nine months of 2024 (19).

While the overtime tax repeal was a victory for the state’s hourly workers, the exemption will only run from January 1, 2024, through June 30, 2025 (20).

Overtime income taxes are not a significant source of revenue for the state. In an effort to further incentivize Alabamians to work and allow them to keep more of the money that they earn, the overtime tax repeal should be made permanent.

Ensure 2% Grocery Tax Cut is Fully Implemented

House Bill 479 by Representative Danny Garrett, enacted during the 2023 regular session, reduced the state’s grocery tax from 4% to 2%. The first 1% of that tax cut began on September 1, 2023, with the second 1% reduction slated to being as early as September 1, 2024. However, the second phase of the grocery tax repeal did not occur because ETF revenue growth, as estimated by the Director of Finance and Legislative Fiscal Officer, is not projected to be at least 3.5% in 2025. In FY 2024 ETF revenues grew by 2.12%.

From 2015-2024 average annual ETF growth was approximately 6.4%. However, 2021 and 2022 were well above average years. If those two years are excluded from the average, the average annual growth rate drops to about 3.5%, meaning that it could take several years for the grocery tax reduction to be fully implemented.

Given that Alabama’s government has a more than $2 billion surplus entering fiscal year 2024, lawmakers should ensure that the 2% grocery tax repeal is fully implemented, regardless of projected revenues. A full repeal

19 Mike Cason, Alabama overtime tax exemption costs schools $230 million in 9 months: Will lawmakers let it expire?”, AL.com. December 16, 2024, https://www al com/news/2024/12/alabamas-popular-overtime-tax-exemption-costs-schools-230-millio n-in-9-months-what-will-lawmakers-do.html, (accessed December 16, 2024).

20 See House Bill 217, Alabama Legislature 2023 Regular Session.

will provide at least an additional $166 million ($318 million total) to all Alabamians (21).

Conclusion

The Alabama Legislature has made incremental progress towards providing tax relief to citizens over the past two years. Still, there is much more work to be done. Lawmakers should continue to pursue bolder tax reform initiatives in the 2024 regular session. Doing so will allow citizens to keep more of their hard earned money as well as make the state more competitive in attracting new residents and business opportunities to Alabama.

21 See Legislative Service Agency Fiscal Division, Fiscal Note to House Bill 479, 2023 Regular Session.

Certificate of Need Elimination

Background

Certificate-of-need (CON) laws are regulations that require any new or expanded healthcare service or facility to be approved by Alabama’s state government. In essence, a healthcare provider must prove to the Alabama Certificate of Need Review Board that a new or expanded service is needed. This is often a costly and time-consuming process that increases the healthcare costs for all patients and can delay access to essential care (1). Alabama is currently one of 35 states operating a CON program (2). The maximum Certificate of Need filing fee is currently $25,706, though costs can quickly increase depending on whether an application is approved or denied (3).

Because existing hospitals and healthcare providers have the power to oppose attempts to provide additional medical services, CON laws serve to limit competition and promote an anti-free-market environment in the healthcare space (4).

The assumption with CON regulation is that excess capacity (in the form of overbuilding) directly results in health care price inflation. When a hospital cannot fill its beds, fixed costs must be met through higher charges for the beds that are used. Larger institutions have greater costs, so CON

1 State Policy Network, “Certificate-of-Need Laws: Why They Exist and Who They Hurt”, April 1, 2021, https://spn.org/articles/certificate-of-need-laws/, (accessed December 14, 2023).

2 National Conference of State Legislatures, “Certificate of Need State Laws”, Updated December 20, 2021, https://www.ncsl.org/health/certificate-of-need-statelaws#:~:text=Currently%2C%2035%20states%20a nd%20Washington,of%20December%202021%20are%20listed, (accessed December 14, 2023)

3 Alabama State Health Planning and Development Agency, Memorandum, New Certificate of Need Application Fee and Monetary Threshold for Review, September 23, 2024, http://www shpda alabama gov/documents/conforms/confee/FY2023%20CON%20Thresholds pdf

4 State Policy Network, “Certificate-of-Need Laws: Why They Exist and Who They Hurt”, April 1, 2021, https://spn.org/articles/certificate-of-need-laws/, (accessed December 14, 2023).

supporters claim it makes sense to limit facilities to keep existing facilities at capacity to meet actual needs (5).

In reality, CON regulations restrict the supply of medical facilities and equipment, making them more expensive. To increase competition and lower the overall costs of healthcare for Alabamians, CON regulations should be repealed (6).

Current Law

The origins of CON laws date back to 1974 when Congress passed the National Health Planning and Resource Development Act.

As a way to control rising healthcare costs, the act required that in order to receive federal healthcare funding, construction of new healthcare facilities and the expansion of existing facilities had to be approved by a state agency established to issue certificates of need. All 50 states had established such agencies by 1980, with Alabama’s beginning in 1979. The expansion of

5 Alabama Policy Institute, Guide to the Issues: Certificate of Need (CON) Laws, https://alabamapolicy org/wpcontent/uploads/2020/11/Certificate-of-Need-CON-Laws pdf, (accessed December 14, 2023).

6 Ibid.

services would only be allowed if providers could demonstrate that the costs would be offset by actual demand. The federal government initially subsidized state governments for CON related expenses (7).

During the 1980s, the federal government stopped its Medicare cost-based reimbursement system and instead began paying a predetermined fixed cost based on the type of treatment. At that point states were no longer federally required to have CON regulations (8). Since 1987, 15 states have dropped CON requirements (9).

The Case for Legislative Reform

CON regulations have failed to slow the growth of healthcare costs (10). By repealing CON requirements, Alabama’s state government could reduce the costs of healthcare for all patients as well as improve access to care, without spending more taxpayer dollars.

Alabama has one of the most restrictive CON requirements in the nation, with 17 services falling under the CON umbrella as of January 2020. The Mercatus Center at George Mason University found that states with four or more CON laws “have systematically lower-quality hospitals than non-CON states (11).”

According to research from the Mercatus Center, per capita patient spending in Alabama could be reduced by $203 annually if CON requirements were repealed. Mercatus also found that removing CON requirements could improve overall access to healthcare, increasing the total number of hospitals by 53 and adding 6 additional ambulatory

7 Alabama Policy Institute, Certificate of Need Laws: Why It’s Time for Repeal, 2007, https://alabamapolicy org/wp-content/uploads/2020/11/API-Research-Certificate-of-Need new pdf, (accessed December 14, 2023).

8 Ibid.

9 National Conference of State Legislatures, “Certificate of Need State Laws”, Updated December 20, 2021, https://www.ncsl.org/health/certificate-of-need-statelaws#:~:text=Currently%2C%2035%20states%20a nd%20Washington,of%20December%202021%20are%20listed

10 Ibid.

11 Mercatus Center George Mason University, “Alabama and Certificate-of-Need Programs 2020: How CON Laws Affect Healthcare Access, Quality, and Cost in Alabama, March 18, 2021, https://www.mercatus.org/publication/alabama-and-certificate-need-programs-2020, (accessed December 14, 2023).

surgical centers. Rural Alabamians specifically, would gain access to an estimated 18 new hospitals and an additional ambulatory service center (12).

Aside from access to care, the quality of care received by patients could also improve if CON regulations were repealed.

The Mercatus Center found that post-surgery complications and mortality rates for heart attacks, heart failure, and pneumonia would all be reduced in Alabama if healthcare providers were not regulated by CON. It is also estimated that readmission rates will decrease while overall patient satisfaction of the healthcare they receive will increase (13).

Removing CON regulations and encouraging a free-market healthcare system is the key to lowering costs and improving outcomes for Alabamians. Economists widely recognize that competition in the healthcare sphere is the most effective tool for driving down overall costs (14).

12 Ibid.

13 Ibid.

14 Alabama Policy Institute, Certificate of Need Laws: Why It’s Time for Repeal, 2007, https://alabamapolicy.org/wp-content/uploads/2020/11/API-Research-Certificate-of-Need new.pdf, (accessed December 14, 2023).

Alabama’s current CON structure allows the state government to choose winners and losers and favors long-established healthcare providers over new companies and innovations looking to enter the state’s market. Competitiveness provides incentives to discover new technologies and new efficiencies to deliver those technologies to patients in an ever-changing healthcare environment.

There is no evidence that free-market competition cannot work to control rising healthcare costs. CON laws have had the opposite effect of this intent. In areas where providers have been allowed to flourish, customers have been rewarded with an increase in healthcare options and more competitive pricing (15). It is time for the Alabama Legislature to reform the state’s CON regulations and allow a free market healthcare system to flourish.

Reforms in Other States

Florida

In 2019, Florida enacted a law eliminating a portion of CON laws for hospitals. The elimination occurred in two phases. First, the state repealed CON regulation for general hospitals, including most surgical centers. The

15 Ibid.

second phase of the elimination, implemented in 2021, exempted regional hospitals with 101-500 beds, specialty hospitals offering a restricted range of services, and specialty hospitals offering Intensive Residential Treatment Facility Services for Children and Adolescents. Nursing homes, hospice care, and facilities that treat the developmentally disabled remain subject to the states CON regulations (16).

In the wake of Florida’s partial CON repeal, healthcare providers announced plans to build a minimum of 65 new hospitals between 2020 and 2022. This is more than three times the amount approved from 2016 to 2018 (17). The repeal has expanded the availability of healthcare into areas that had previously been limited because of the CON veto power of existing providers (18).

South Carolina

South Carolina is the most recent state to enact CON reforms, signing Senate Bill 164 into law in May 2023. The law repeals CON requirements for all of the state’s providers, with the exception of long-term care facilities. In support of the bill, the Institute for Justice said that “repealing CON will help all South Carolinians by decreasing healthcare costs and increasing access to needed care (19).”

While it is too early to analyze the overall impact of South Carolina’s CON repeal, Palmetto Promise Institute, a non-partisan think tank, said that it was a “step towards a more affordable, accessible, and effective healthcare system” and that it will lower healthcare costs, promote competition, and increase healthcare innovation (20).

16 JDSupra, “No Need for Certificate of Need: Florida Eliminates Certificate of Need Review for Specialty Hospitals”, June 23, 2021, https://www.jdsupra.com/legalnews/no-need-for-certificate-of-need-florida-8919123/, (accessed December 20, 2023).

17 Noah Schwartz, “Florida sees hospital boom after dropping certificate-of-need rules”, Beckers Hospital Review, April 27, 2023, https://www.beckershospitalreview.com/legal-regulatory-issues/florida-sees-hospital-boom-after-droppi ng-certificate-of-need-rules.html, (accessed December 20, 2023).

18 State Policy Network, “Certificate-of-Need Laws: Why They Exist and Who They Hurt”, April 1, 2021, https://spn org/articles/certificate-of-need-laws/, (accessed December 20, 2023)

19 Andrew Wimer, “South Carolina Governor Signs Certificate of Need Repeal Bill”, Institute for Justice, May 18, 2023, https://ij.org/press-release/south-carolina-governor-signs-certificate-of-need-repeal-bill/, (accessed December 20, 2023)

20 Wendy Damron, “What Will CON Repeal Mean for You”, Palmetto Promise Institute, May 8, 2023, https://palmettopromise.org/what-will-con-repeal-mean-for-you/, (accessed December 20, 2023).

West Virginia

In 2023, the West Virginia Legislature enacted a law to repeal CON regulations for all hospital services and the state’s birthing centers. Hospitals are no longer required to receive state approval for the expansion of procedures such as inpatient services, out-patient services, emergency room services, surgical services, diagnostic and imaging services, and laboratory services. According to the Cardinal Institute, CON regulations had blocked at least 2,424 additional hospital beds, 25 hospitals and ambulatory surgery centers, up to seven MRIs, and 16 additional CT scan machines from being established in the state.” They expect the partial CON repeal to expand access to high quality healthcare for West Virginia residents (21).

Impact on Rural Hospitals

Evidence shows that CON regulations negatively impact rural communities the most. A study conducted by the Mercatus Center at George Washington University found that CON states have 30% fewer rural hospitals per 100,000 residents than non-CON regulated states and 14% fewer ambulatory surgical centers. CON states also spend more Medicaid dollars per patient in rural areas and have higher emergency room utilization levels (22).

21 Cardinal Institute for West Virginia Policy, “Coalition Thanks Policy Makers for Repeal of Certificate of Need for Hospitals and Birthing Centers in West Virginia, Press Release, March 29, 2023, https://cardinalinstitute com/press-release/sb613-signing/

22 Thomas Stratmann and Christopher Koopman, “Entry Regulation and Rural Health Care: Certificate-of-Need Laws, Ambulatory Surgical Centers, and Community Hospitals”, Mercatus Center, February 18, 2016, https://www.mercatus.org/research/working-papers/entry-regulation-and-rural-health-care-certificateneed-laws-ambulatory.

Rural hospitals in CON states are also at a much greater risk of closure than in non-CON states. Data compiled by the University of North Carolina found that 191 rural hospitals have closed since 2005. Every single closure occurred in CON regulated states (23).

The Mercatus Center study concluded that “CON programs do not promote access to rural care in the form of rural hospitals. CON laws are associated with a decrease, not an increase, in the number of hospitals, rural or otherwise. Policymakers seeking to protect access to rural care should not use CON programs to achieve their goals (24).”

Conclusion

CON laws have never had their intended effect of reducing the rising costs of healthcare and increasing access to care. In most examples they have done the opposite, increasing costs and making it more difficult for

23 University of North Carolina, “Rural Hospital Closures”, The Cecil C. Sheps Center for Health Services Research, https://www.shepscenter.unc.edu/programs-projects/rural-health/rural-hospital-closures/, (accessed December 20, 2023).

24 Thomas Stratmann and Christopher Koopman, “Entry Regulation and Rural Health Care: Certificate-of-Need Laws, Ambulatory Surgical Centers, and Community Hospitals”, Mercatus Center, February 18, 2016, https://www mercatus org/research/working-papers/entry-regulation-and-rural-health-care-certificateneed-laws-ambulatory.

Alabamians to find quality healthcare providers, particularly in rural and underserved communities. Alabama lawmakers should enact reforms that increase competition and innovation in the healthcare industry, not continue to give preferential treatment to long-standing providers.

Expand Alabama’s Public Sector Payroll Deduction Ban

Background

Alabama enacted a state payroll deduction ban more than ten years ago. Under that law, the Legislature stopped the practice of using payroll deduction to directly fund political activities. Despite the ban, many state employees continue to have membership fees paid to public sector unions through automatic payroll deduction. While these dues may not go directly to elected officials and candidates, the organizations financed by membership fees continue to engage in political activities. The Alabama Legislature should end the practice of state government facilitating payment of membership dues to public sector unions.

Current Law

Sections 36-1-4.3 and 36-1-4.4 of the Code of Alabama allow public employees to request that the Alabama State Comptroller arrange for the payment of membership dues for employee organizations by payroll deduction1 .

Alabama amended its payroll deduction law during a December 2010 special session, in which the Legislature banned payroll deductions from being used to fund political activities, most notably contributions to Political Action Committees (PAC). In response, the Alabama Education Association (AEA) and several other organizations sued that the state violated their First Amendment rights because the law was overbroad and

1 See Sections 36-1-4.3 and 36-1-4.4, Code of Alabama.

unduly vague2 . Ultimately, the U.S. 11th Circuit Court of Appeals upheld the law and allowed the payroll deduction ban to remain in place3 .

Despite the payroll ban, Alabama state employees can still have payroll deductions made that go towards membership dues of public sector unions, such as the Alabama Education Association and Alabama State Employees Association. While these deductions may not go directly to political candidates through PACs, they certainly help finance political activity. For example, the Alabama Education Association has approximately 85,000 members and collected over $17.7 million in revenues in 2023. As of December 2024, the AEA employed forty-seven registered lobbyists who can be seen representing the AEA on nearly every major issue that comes before the Legislature4 .

Though AEA and other public sector unions may be banned from using state payroll deductions to directly fund candidates, membership dues are still being used to fund political and lobbying activities. AEA membership dues are also being paid to the National Education Association (NEA) and the NEA is a grant-making entity that funds AEA with millions of dollars in grant funding per year. This should not be allowed.

That is not to say that state employees should not be allowed to direct money or be members of groups of their choice. However, the state of Alabama should not be in the business of facilitating those payments. Because of readily available modern banking technology, employees can easily arrange automatic deductions on their own behalf.

Reforms in Other States

At least four states have recently considered legislation to strengthen state payroll deduction laws.

2 Alabama Policy Institute, “Automatic Payroll Deductions for Politically Active Organizations” Guide to the Issues, 2013, https://alabamapolicy.org/wp-content/uploads/2020/11/2013-10-30-Automatic-Payroll-Deduction-forPolitically-Active-Organizations.pdf.

3 Mike Cason, “Federal court upholds Alabama law banning state payroll deductions for political groups ” , September 28, 2016, AL com, https://www.al.com/news/birmingham/2016/09/federal court upholds alabama.html, (accessed December 27, 2023).

4 State of Alabama Ethics Commission, “2024 Registered Lobbyist List”, Alabama Secretary of State, https://ethics-form.alabama.gov/entity/FileUpload2015/RegisteredLobbyist/WebDataLobbyistsPDF 20 10.aspx

During its 2023 regular session, Arkansas lawmakers enacted a bill that prohibits school districts from deducting dues, fees, or contributions from a teacher or classified employees’ salary on behalf of any professional organization, labor organization, or political fund5 .

Florida passed a similar bill in 2023, banning all employee organizations that have been certified as bargaining agents from having dues and assessments deducted and collected by employers. The Florida law provides exceptions for public sector unions representing law enforcement officers, correctional officers, probations officers, and firefighters6 .

Senate Bill 7, enacted by the Kentucky General Assembly in March 2023, prohibits public employers from deducting any “ wages, earnings, or compensation of any public employee”, for “dues fees, assessments, or other charges to be held for, transferred to, or paid over to a labor organization”, and for any political activities. Kentucky Governor Andy Beshear vetoed the bill on March 27, 2023; however, the General Assembly overrode his veto two days later7 .

Finally, the Tennessee General Assembly enacted an education specific payroll deduction ban in 2023. Under the provisions of Senate Bill 281, local education agencies are prohibited from deducting any employee wages for professional organization dues and are specifically banned from deducting dues for organizations affiliated with the National Education Association8 .

Conclusion

Given advancements in banking technology, it is no longer appropriate nor necessary for the state to facilitate payroll deductions for membership dues on behalf of state employees. Too often, these dues are being used to fund political activities related to issues that come before the Alabama Legislature. State employees should continue to have the freedom to fund these activities if they so choose to, but state government funded by taxpayers should play no role in the process.

5 See Senate Bill 473, Arkansas Legislature 2023 Regular Session.

6 See Senate Bill 256, Florida Legislature 2023 Regular Session.

7 See Senate Bill 7, Kentucky General Assembly 2023 Regular Session.

8 See Senate Bill 281, Tennessee General Assembly 2023 Regular Session.

Prohibit Overregulation of Fossil Fuels

Background

Over the past several years there has been a growing debate about the use of gas-powered appliances and equipment, with numerous state and local jurisdictions taking steps to restrict, and in some cases outright ban, their use. While Alabama lawmakers have already taken steps to protect consumers ’ rights to continue to purchase gas appliances, there is currently no state law regulating the use of gas-powered equipment, leaving the potential for local governments to develop their own regulations.

While electric powered equipment is generally quieter than its gas counterparts, they have several negative impacts, particularly for those using them in a commercial business environment. Perhaps the most significant issue is that electric powered equipment is not as powerful as gas, meaning not only will it take a business longer to complete a project for its customer, but it will also mean that they can complete fewer projects over the course of a day, week etc. For most commercial business owners, it is simply not practical to use electric powered equipment1 .

1 Hannah Wallace, “The Movement to ‘Make America Rake Again”, Reasons to Be Cheerful, January 18, 2024, https://reasonstobecheerful world/make-america-rake-again-leaf-blower-bans/#:~:text=There%20are% 20many%20arguments%20against,would%20already%20have%20saved%20$2%2C904., (accessed December 3, 2024).

There is also the issue of battery life, i.e. battery powered equipment has a finite timeline. Once the battery is drained, the user must wait for it to recharge or must have additional batteries on hand to continue to work uninterrupted, again costing business owners time and money2 . So long as a user has more gas for gas-powered equipment, it can run an infinite amount of time.

Among other issues with electric powered equipment is the cost. According to Turf Magazine, “electric equipment is much more expensive than its internal combustion engine counterparts”. The primary reason that electric equipment is more expensive is because of the batteries used to power it, which again a user will likely need multiple sets of in a commercial setting3 . If a ban on gas powered equipment were to be put into place, it could be devastating for local businesses who would be forced to purchase all new electric equipment as well as additional batteries.

2 Ibid.

3 Brandon Haley, “Gas Vs Electric OPE: Real World Costs”, Turf Magazine, May 5, 2023, https://turfmagazine.com/gas-vs-electric-outdoor-power-equipment-real-world-costs/, (accessed December 3, 2024).

As of October 2024, an estimated twenty-six policies and programs had been put into place to address the use of gas-powered lawn equipment specifically. These policies range from bans on gas powered leaf blowers, prohibiting the sale of all gas lawn equipment, requiring local governments to only use electric powered equipment, and providing incentives to homeowners and businesses for purchasing electric lawn equipment, among others4 .

Alabama lawmakers should take steps to protect the rights of home and business owners alike to continue to use gas powered equipment if they choose to do so.

Current Law

Alabama does not currently have a specific statute relating to the use of gas powered equipment. However, during the 2024 Regular Legislative Session, lawmakers took steps to protect gas powered appliances. Senate Bill 50 by Gerald Allen prohibits any governmental entity from enacting or enforcing “ any resolution, ordinance, regulation, rule, code, program, or policy or take any other action that restricts or prohibits, or has the effect of restricting or prohibiting, any person or other entity from acquiring or using any appliance solely based on the type of energy or energy generation used to operate the appliance.” The protection extends to both home and commercial use and includes, but is not limited to, appliances used for cooking, heating, cooling, and washing and drying clothes.5

Senate Bill 50 was passed unanimously by the Alabama Legislature.

Reform in Other States Georgia

During its 2024 legislative session the General Assembly of Georgia enacted the Landscape Equipment and Agricultural Fairness (LEAF) Act. As part of the legislative findings of the bill, the General Assembly stated that allowing individual political subdivision to regulate gasoline-powered leaf blowers created “the potential for confusing and varying regulations which could

4 Kristen Schatz and Ellie Kerns, “Interactive map of lawn mower and leaf blower policies”, U.S. PIRF, October 16, 2024, https://pirg org/edfund/resources/interactive-map-of-lawn-mower-and-leaf-blower-policies/, (accessed December 3, 2024).

5 See Senate Bill 50, Alabama Legislature, 2024 Regular Session.

lead to increased costs for urban agriculture, homeowners, and landscape service professional to comply with such regulations6 . ”

The Georgia law simply states that there shall be no “prohibition or regulation regarding the use, disposition, or sale or any imposition of any restriction, fee imposition, or taxation of gasoline-powered leaf blowers at the retail, manufacturer, or distributor setting, except by general law”, meaning that the General Assembly reserved the right to regulate leaf blowers in the future, but only at the statewide level7 .

Texas

In 2023, the Texas Legislature took similar steps to protect gas-powered equipment, though its law is more expansive than Georgia’s, stating that a political subdivision may not adopt or enforce a regulation that limits access to or use of an energy source. It goes further in terms of the regulation of engines saying that political subdivisions “ may not adopt or enforce an ordinance, order, regulation, or similar measure that directly prohibits or restricts the use, sale, or lease of an engine based on its fuel source8 . ”

The Texas law came in response to several cities, including Dallas, attempting to implement ordinances that would have banned residents and commercial business from using gas-powered lawn mowers and landscaping equipment9 .

Conclusion

Because of Alabama’s economic reliance on agricultural and horticultural activities, the type of equipment that both home and business owners can use is important. While electric engines may be less of a noise nuisance than their gas-powered counterparts, at this time they do not provide the same power and efficiency; the start-up costs as well as the ongoing costs of batteries are cost prohibitive for many users. Alabama lawmakers should consider following the Texas model and protect all fuel sources and engine

6 See House Bill 374, General Assembly of Georgia, 2024 Regular Session

7 Ibid.

8 See Senate Bill 1017, Texas Legislature, 2023 Regular Session.

9 Everton Bailey Jr , “Dallas Changes Plans to Ban Gas-Powered Lawn Equipment”, July 20, 2023, https://www.governing.com/policy/dallas-changes-plans-to-ban-gas-powered-lawn-equipment, (accessed December 3, 2024).

types, leaving Alabamians the freedom to choose what equipment type best suits their needs.

Strengthen Unemployment Compensation Requirements

Background

Workforce development has been a key issue for Alabama lawmakers over the past several legislative sessions. During the 2024 Regular Legislative Session, lawmakers enacted a package of bills aimed at incentivizing Alabamians to return to the state’s workforce.

Amongst bills included in the proposal were the creation of a new childcare tax credit, a workforce housing tax credit, and the creation of a workforce pathways diploma1 .

One of the major goals of the workforce development package was to improve the state’s continually lagging labor participation rate, which sat at 57.6% as of November 20242 .

Alabama has consistently had one of the lowest labor participation rates in the nation over the last two decades. Lawmakers are hoping to remove barriers that some Alabamians face when trying to enter the workforce, including the costs of childcare and providing better career training to potential/future employees.

1 Alexander Willis, “Alabama House modifies, passes five workforce development bill”, Alabama Daily News, April 19, 2024, https://aldailynews.com/alabama-house-modifies-passes-five-workforce-development-bills/, (accessed December 4, 2024

2 Alabama Department of Labor, “Alabama’s Labor Force Participation Rate Increases to 57.6”, Press Release, November 15, 2024.

While these initiatives will not discourage state citizens from working, only time will tell how far they will go towards improving the state’s labor participation rate. There are other things that lawmakers can do to achieve that goal. One option is to strengthen Alabama’s unemployment compensation requirements, ensuring those citizens who are able and have the opportunity to work are doing so.

Current Law

As of October 2024, Alabama had an unemployment rate of 2.9%, representing 69,271 able-bodied residents who were unemployed. This was approximately 5,000 more Alabamians unemployed than during the same point in 20233 .

Unemployment compensation is provided to workers who are unemployed or working reduced hours through no fault of their own. The program is funded by qualified employers on the first $8,000 of each employees’ gross

3 Alabama Department of Labor, “October 2024 Unemployment Situation”, https://www2.labor.alabama.gov/, (accessed December 5, 2024).

earnings, which are then deposited into the state’s Unemployment Compensation Trust Fund4 .

In order to draw unemployment compensation benefits, there are certain conditions that a claimant must meet, and continue to meet.

First, there is a monetary determination that must be made as to whether a claimant earned enough wages in the proceeding 12-18 month period. Next, why a person is no longer working can impact their ability to receive unemployment benefits. If a person was laid off or had their hours reduced because the employer did not have enough work for them, if they left their job because of unsafe working condition, or if they are unemployed because they or their child was a victim of domestic violence, stalking, or sexual assault, they will be eligible to receive benefits5 .

A person is not eligible to receive unemployment benefits if they voluntarily left their job, were fired for wrongdoing, are not legally authorized to work in the United States, are full time self-employed, or are receiving workers’ compensation benefits for an on-the-job injury6 .

Finally, to qualify for and continue to receive benefits a claimant must be actively looking for work, mentally and physically able to work, legally able to work in the United States, and available to start new work7 .

In Alabama, weekly unemployment benefits range from a minimum of $45 to a maximum of $275, which is calculated using your base period earnings during the monetary determination phase of the unemployment compensation eligibility process. Recipients can generally receive unemployment benefits for a period of 14-20 weeks, which fluctuates based on the state’s unemployment rate8 .

Reform in Other States

Congress

4 Alabama Department of Labor, “Alabama Unemployment Compensation Benefit Rights and Responsibilities: A Handbook for Unemployment Compensation Claimants”, https://labor.alabama.gov/docs/guides/uc brr.pdf, (accessed December 5, 2024).

5 Ibid.

6 Ibid

7 Ibid.

8 Ibid.

In 2023, U.S. Congressman Chuck Edwards (NC) introduced the Unemployment Integrity Act, which could strengthen unemployment requirements across the United States. Among other provisions, the bill would require all states to establish minimum interview requirements for unemployment insurance claimants. This includes the claimants responding to requests for interviews, scheduling interviews, and attending an offered interview at an agreed time. In addition to these requirements, Congressman Edwards’ bill would also require unemployment insurance claimants to respond to any other reasonable requests as part of the interview process, including drug testing and skills assessments9 . The bill is yet to be considered by the House Committee on Ways and Means.

Recently, Alabama Senator Katie Britt opined about work requirements, saying regarding the DOGE project, “One of the things I'm hopeful that they look at is actual work requirements for government benefits. If you're an able-bodied working-age American without dependents you should be working, training, volunteering or being educated at least 20 hours a week in order to receive these benefits.”

North Carolina

In 2021, Senate Bill 116, the Putting North Carolina Back to Work Act, was introduced in the North Carolina General Assembly. The bill would have withdrawn North Carolina from the Federal Pandemic Unemployment Compensation program, which provided $300 in enhanced weekly benefits to unemployment claimants. In addition to this provision, the Putting North Carolina Back to Work Act required unemployment claimants to respond to any interview request by an employer offering suitable work within 48 hours. It further required that once an interview request has been made, an interview must be scheduled within seven days10 .

The Putting North Carolina Back to Work Act was approved by the General Assembly but vetoed by Governor Roy Cooper.

Iowa

9 Congressman Chuck Edwards, “Edwards introduces bill to reform unemployment benefits, promote work”, Press Release, October 17, 2023, https://edwards.house.gov/media/press-releases/edwards-introduces-bill-reform-unemployment-benefi ts-promote-work.

10 North Carolina General Assembly, “Senate Bill 116: Putting North Carolina Back to Work Act”, Legislative Summary, February 24,2022, https://dashboard.ncleg.gov/api/Services/BillSummary/2021/S116-SMTM-53(rat)-v-7.

During its 2023 legislative session, the Iowa Legislature considered a bill to require between 4-6 work searches each week that an individual received unemployment benefits. The legislative set a sliding scale for the number of searches required which would be tied to the number of available jobs in the state. When more than 60,000 jobs were available, six searches would be required each week. If less than 50,000 jobs were available across the state, four searches would be required each week to continue receiving unemployment benefits11 . The bill was not approved by the Iowa Legislature.

Pennsylvania

In 2024, Pennsylvania lawmakers introduced a bill that would have established a process for employers to report refusals to work. The bill was aimed at addressing situations in which job candidates admitted to only applying for a job in order to comply with the state’s unemployment compensation requirements, with no intention to accept a position. The proposal required the Pennsylvania Department of Labor to create forms allowing employers to report unemployment insurance claimants who “discourage their own hire”12 . The bill passed the Pennsylvania Senate but was not considered by the House of Representatives.

Potential Reforms to Consider

Representative Ed Oliver has prefiled a bill (House Bill 29) for the 2025 Regular Legislative Session that would ensure that Alabamians who are receiving unemployment compensation are actively seeking employment. Under current law, unemployment recipients are required to make a reasonable effort to secure work in order to continue receiving benefits. This includes contacting at least three prospective employers each week that they are receiving unemployment benefits. Under the provisions of Oliver’s bill, the number of weekly contacts would be increased from three to five13 . In 2022, the Legislature increased the required number of weekly contacts from one to three14 .

Current law also requires that if a person is offered “suitable work” and fails to accept the position, they are barred from receiving unemployment

11 See Seante File 451, Iowa Legislature, 2023 Regular Session.

12 See Senate Bill 1109, Pennsylvania General Assembly, 2024 Regular Session

13 See House Bill 29, Alabama Legislature, 2025 Regular Session.

14 See Senate Bill 224, Alabama Legislature, 2022 Regular Session.

compensation benefits for at least one week and not more than five weeks. Representative Oliver’s bill would eliminate the range and set the disqualification period at five weeks, strengthening the penalties for failing to accept work and choosing to remain in the state’s unemployment system15 .

Representative Oliver’s approach to strengthening unemployment compensation requirements is reasonable and measured. Asking someone who is receiving a direct benefit from the state to increase their efforts to find gainful employment not only benefits the individual, put will decrease the overall stress to the state’s Unemployment Compensation Trust Fund, which experienced shortfalls during the COVID-19 pandemic and was ultimately replenished by federal relief funds16 .

Similarly, increasing the time period that unemployment benefit recipients are disqualified from receiving those benefits for declining to accept a job offer is reasonable as well. Unemployment compensation is intended to bridge the gap between jobs. Ultimately taxpayers are helping fellow citizens who have found themselves without a job for no fault of their own. Taxpayers should only continue to do so if benefit recipients are actively engaged in looking for another job and willing to accept any job that they are qualified for.

A one-week disqualification period is not enough of a disincentive for some Alabamians to choose to forgo employment in favor of remaining on unemployment benefits.

15 Ibid

16 Justin Bogie, “Rush to spend ARPA funds is feeding government rather than taking less from the people”, Alabama Policy Institute, January 20, 2022, https://alabamapolicy.org/2022/01/20/rush-to-spend-arpa-funds-is-feeding-government-rather-than-ta king-less-from-the-people/, (accessed December 5, 2024)

Conclusion

Unemployment compensation should be temporary aid for workers who have lost their job at no fault of their own. Their goal should be to find new employment as quickly as possible, not to continue receiving benefits for as long as possible. Strengthening work search requirements is another piece of the puzzle towards reducing Alabama’s labor participation rate and putting more citizens back to work.

Healthcare Price Transparency

Background

When an Alabamian goes to purchase a good or service from one of the state’s businesses or an individual, they almost certainly know what the cost of that item will be before they agree to make the purchase. While there may be additional fees, cost overruns, etc., that arise, Alabamians know what they are paying for and what they are getting.

However, in perhaps the most important industry to Alabama citizens during their lives this is not true. That industry is healthcare.

92.1 percent of Americans have health insurance coverage1 , meaning that it may be simplistic to write this issue off because of the perception that ultimately large health insurance companies will negotiate with healthcare providers and bills will be paid with little impact to Alabamians.

But this is not the case. As healthcare costs have risen sharply over the past 20 years, more Americans than ever are now enrolled in high deductible health plan (HDHPs), 55.7% in 2021. Enrollment in HDHPs increased by nearly 84 percent from 2013-2021 (2). More people on HDHPs means larger bills for patients each time they go to the doctor, until their deductible is reached. According to a 2022 report from the Cicero Institute, nearly half of insured adults say that they have difficulty paying

1 Katherine Keisler-Starkey, Lisa N. Bunch, and Rachel A. Lindstrom, “Health Insurance Coverage in the United States: 2022”, Census.gov, September 2023, https://www census gov/content/dam/Census/library/publications/2023/demo/p60-281 pdf

2 Scott Wooldridge, “HDHP enrollment reaches more than 50% of American private-sector worker”, ALM Benefits Pro, February 20,2023, https://www benefitspro com/2023/02/20/hdhp-enrollment-reaches-more-than-50-of-american-private -sector-workers/?slreturn=20231112133623#:~:text=A%20record%2Dhigh%20number,care%20costs%2 C%20according%20to%20experts., (accessed December 11, 2023).

out-of-pocket expenses, with a third reporting that they are unable to pay their health insurance deductible (3).

For many patients, the rising costs of healthcare are not sustainable. They are being forced into a situation where they have little choice but to make difficult financial decisions or forgo needed care. Alabamians have a right to know the costs of healthcare services and procedures before they are performed. Similarly, they have a right to know the cash price of services compared to what is paid by insurance companies, and choose the most cost effective option for themselves, without being penalized.

Current Law

There is currently no state law governing healthcare price transparency in Alabama. However, on October 29,2020, the U.S. Department of Health and Human Services, the Department of Labor, and the Department of the Treasury released the Transparency in Coverage final rule in response to an executive order made by then President Donald Trump; Improving Price

3 Joshua Archambault and Jonathan Wolfson, “Patient’s Right to Save: The Next Generation of Price Transparency, Cicero Institute, October 2022.

and Quality Transparency in American Healthcare to Put Patients First. The rule went into effect on January 1, 2021.

Under the provisions of the rule, most health insurance providers are required to make available “personalized out-of-pocket cost information, and the underlying negotiated rates, for all covered health care items and services, including prescription drugs, through an internet-based self-service tool and in paper form upon request.” Additionally, insurance providers are required to provide machine-readable files that include detailed pricing for healthcare services. This includes disclosing negotiated rates for all covered items and services between an insured and in-network providers, payments to, and billed charges from, out-of-network providers, and the in-network rates and historical net prices for all covered prescription drugs (4).

According to the Department of Health and Human Services the goal of the rule is to incentivize insurers to allow consumers to seek out lower-cost services and then share those savings with patients (5). Having a robust healthcare price transparency system saves money for both insurers and patients.

Despite the rule being in place for nearly three years, compliance continues to be an issue. As of March 2023, only about one-third of hospital providers nationwide were fully compliant. In Alabama only 10 percent of the state’s hospitals were fully compliant (6). Hospitals can be fined for failing to comply with federal transparency requirements, with the minimum total penalty set at $109,500 and the maximum penalty being capped at $2,007,500 per hospital (7).

4 Centers for Medicare and Medicaid Services, “Transparency in Coverage Final Rule Fact Sheet (CMS-9915-F), October 29,2020.

5 Ibid.

6 Marilyn Bartlett and Christin Deacon, “Alabama hospitals are profitable enough to comply with price transparency requirement”, The Montgomery Advertiser, March 1, 2023, https://www.montgomeryadvertiser.com/story/opinion/contributors/2023/03/01/alabama-hospitals-pr ofitable-enough-to-comply-with-price-transparency/69956315007/, (accessed December 11, 2023)

7 Kunal N. Patel, et al, “Hospital compliance with price transparency policy in the U.S.”, September 30, 2023, https://jhmhp.amegroups.org/article/view/8144/html (accessed November 26, 2024).

Beyond the compliance issue, the federal rule falls short in that it only applies to hospitals, meaning that insurers are not required to disclose any cost information for healthcare providers working outside of a hospital setting.

Reforms Alabama Lawmakers Should Consider

First and foremost, Alabama lawmakers should take steps to ensure that federal guidelines relating to healthcare price transparency are being followed, allowing Alabamians to know the true costs of healthcare services before receiving treatment. This could include codifying federal law and/or allowing the state to further penalize hospitals that are noncompliant with the federal price transparency rule.

Next, lawmakers should seek policy reforms that incentivize and reward patients for choosing lower cost, but high quality, alternatives to the traditional health insurance payment model.

There are a number of examples from other states that could be considered: Tennessee

In Tennessee, all health insurance providers are required to create an online database and provide a toll-free phone number that gives customers access to estimates of the out-of-pocket costs that they should expect to pay for a procedure. Prior to 2023 Tennessee law also required insurers to have an incentive plan in place for patients who choose to have healthcare services performed by a doctor who provided the services at costs below the insurance average (8).

In 2023 the Tennessee General Assembly built upon and strengthened these reforms by providing additional incentives to patients who choose lower costs healthcare providers. Under the provisions of House Bill 1213 an insured patient is permitted to pay for healthcare costs out-of-pocket at either an in or out-of-network provider. If the costs paid by the patient are less than the average amount paid by their insurance carrier, the full amount of the out-of-pocket payment must be applied to their insurance deductible, coinsurance, copayment, or other cost-sharing amount (9).

This reform allows Tennesseans to use any healthcare provider that they choose to while barring their insurance provider from discriminating against them for doing so. The new Tennessee law applies to both public and private sector employees (10).

Florida

Florida law requires that by patient request a hospital must provide both personalized and non-personalized cost estimates for anticipated services withing seven business days of such request. Hospitals must also publicize through a website that patients have the right to request a cost estimate. Additionally, Florida has a program in place that offers insurer based cash incentives to patients who choose lower costs shoppable healthcare services. The Florida law does not apply to non-hospital providers (11).

8 Caterina DiBiase, Lauren Corvese, Scott Haller, Barbara Anthony, Josh Archambault, and Seher Chowdhury, “Status of Healthcare Price Transparency across the United States”, Pioneer Institute, May 2020, https://pioneerinstitute.org/transparency/national-study-finds-most-states-lack-healthcare-price-transp arency-laws/, (accessed December 11, 2023).

9 See House Bill 1213, 2023 Tennessee General Assembly.

10 Josh Archambault, “New TN & TX Price Transparency Laws Prevent Patients From Getting Ripped Off”, Forbes, November 8, 2023, https://www.forbes.com/sites/theapothecary/2023/11/08/new-tn--tx-price-transparency-laws-preventpatients-from-getting-ripped-off/?sh=976717fb12d8, (accessed December 11, 2023)

11 Caterina DiBiase, Lauren Corvese, Scott Haller, Barbara Anthony, Josh Archambault, and Seher Chowdhury, “Status of Healthcare Price Transparency across the United States”, Pioneer Institute, May

Texas

Prior to its 2023 session the Texas Legislature had already enacted legislation requiring that healthcare facilities have policies in place that allow patients to receive cost estimates for all elective inpatient services and nonemergency outpatient services. The state also maintains a website that allows citizens to see cost estimates for in-network and out-of-network services across different regions of the state.

In 2023 the Texas Legislature enacted House Bill 2022 which like the Tennessee law requires insurers to give patients deductible credit for out-of-pocket expenses paid directly to lower costs healthcare providers (12).

Conclusion

The costs of healthcare services can be overwhelming for Alabamians, regardless of what type of, or if they carry health insurance coverage. All patients have a right to know the true costs of healthcare services being provided to them. By pursuing price transparency reforms and incentivizing patients to seek out more affordable options, Alabama lawmakers could help to reduce costs for all citizens. Doing so could also encourage greater competition within the healthcare industry and attract patients to providers who provide lower cost cash services.

12 See House Bill 2002, Texas Legislature 2023 Legislative Session. 2020, https://pioneerinstitute.org/transparency/national-study-finds-most-states-lack-healthcare-price-transp arency-laws/, (accessed December 11, 2023)

Promote Home Based Businesses & Entrepreneurs

Background

Over the course of the past five years, more Alabamians are working from home than ever before. Specifically, home-based entrepreneurship has increased significantly. The federal Small Business Administration estimates that 86.3 percent of America’s 34.8 million small businesses are sole proprietorships, with about half of those being home-based (1).

Home-based businesses provide several benefits. First, they can be used as a source of primary income and supplemental income. They also provide flexibility to Alabamians caring for dependents (both children and the elderly), and citizens with disabilities and other health care limitations. A 2022 report by the CATO Institute also found that home-based businesses can “bring goods and services into areas whose needs are not being met because they are far from commercial centers” and are an important outlet for low-risk entrepreneurship (2).

Historically, home-based businesses have played an important role in American innovation. Some of the country’s best known companies, such as Amazon, Apple, Microsoft, and Facebook, were born from their owner ’ s home (or dorm room)3 . Though very few home-based startups will ever

1 U.S. Small Business Administration, “Frequently Asked Questions”, Office of Advocacy, July 2024, https://advocacy.sba.gov/wp-content/uploads/2024/11/Frequently-Asked-Questions-About-Small-Busin ess 2024-508.pdf, (accessed November 25, 2023).

2 Chris Edwards, “Entrepreneurship and Home Businesses”, CATO Institute, December 15, 2022, https://www cato org/sites/cato org/files/2022-12/empowering-the-new-american-worker-entrepreneur ship.pdf, (accessed December 26, 2023).

3 Chris Edwards, “Entrepreneurs and Regulations: Removing State and Local Barriers to New Businesses”, CATO Institute, Policy Analysis No 916, May 5, 2021, https://www.cato.org/policy-analysis/entrepreneurs-regulations-removing-state-local-barriers-new-busi nesses, (accessed January 5, 2024).

come near the success of those companies, they still provide the opportunity for Alabamians to improve their financial well-being and find a fulfilling career path. All citizens should have the opportunity to own their own business if they want to.

Despite the benefits of home-based businesses, potential owners often face legal and regulatory barriers in starting them. Local governments impose onerous and in many cases costly zoning and licensing requirements on home-based businesses. There are also industry specific barriers used to prevent business owners from serving their clients from home (4).

While some of the requirements and restrictions placed upon home-based businesses are in the interest of the public’s health, safety, and well-being, they are often applied across the board to all businesses. Alabama businesses that have no impact on the health and safety of their local communities and do not pose the risk of creating a public nuisance should be allowed to operate as freely as possible without unnecessary government interference. Doing so could create a more prosperous business climate for individuals and provide needed goods and services to underserved communities.

Current Law

There are few specific state laws relating to home-based businesses in Alabama, though as a “disregarded entity”, i.e. a sole proprietorship that is not a corporation and is not taxed as a separate entity for federal tax purposes, home-based businesses are liable for the state’s business privilege tax, depending on the amount of revenue they generate each year. State business licenses are not required for sole proprietorships (5).

Beyond the business privilege tax, there is also an Alabama Cottage Food Law, which was last amended in 2021. The law allows certain non-hazardous foods to be sold by home-based businesses without inspection by local county health departments. The law requires that eligible foods be labeled to include the common name of the food, address that it was produced at, a statement that it has not been inspected by the

4 Chris Edwards, “Entrepreneurship and Home Businesses”, CATO Institute, December 15, 2022, https://www.cato.org/sites/cato.org/files/2022-12/empowering-the-new-american-worker-entrepreneur ship pdf

5 U.S. Chamber of Commerce, “How to Start a Sole Proprietorship in Alabama”, https://www.chamberofcommerce.org/sole-proprietorship/alabama, (accessed December 26, 2023).

health department, a list of ingredients, and a notation that it may contain allergens. While health department inspection is not required, the law does require cottage food operators to maintain a food safety certification (6).

Aside from the limited state requirements, other regulations are left to county and municipal governments. These requirements- from licenses, fees, zoning, safety, etc.- can vary widely from one jurisdiction to another.

Reforms in Other States and Model Legislation

Arizona

During its 2018 regular session the Arizona Legislature approved a sweeping home-based business reform bill, Senate Bill 1387. Ultimately the Legislature failed to reach agreement on the bill in conference committee7 .

Under the provisions of the Arizona law, a municipality would not have been allowed to prohibit the operation of a “no-impact” home business or require a no-impact home-based business to obtain any type of permit, license, variance, or any other type of pre-approval from the municipality to operate. In order to qualify as a no-impact business, the law specified that there could only be two non-family members employed by the business, businesses were limited to the sale of lawful goods and services, no more than three customers could be on the property at one time, it could not substantially increase on-street parking or traffic, business had to take place within the residential dwelling, and activities could not be visible from the street8 .

The law specifically provided that municipalities could still regulate home-based businesses as necessary to protect health and safety. It also specified that businesses relating to the sales of illegal drugs, alcohol,

6 Alabama Department of Public Health, “Cottage Food Law 2021 Update- FAQ’s, https://www alabamapublichealth gov/foodsafety/assets/cottagefoodlawfaqs pdf

7 See Senate Bill 1387, Arizona Legislature 2018 Regular Session.

8 Ibid.

maintaining sober living homes, pornography, obscenity, exotic dancing, and any other type of adult-oriented business was no considered a no-impact home-based business. Senate Bill 1387 also required that the business be owned by the same owner as the residential property9 .

The American Legislative Exchange Council has created model legislation relating to so called “no-impact home-based” businesses. A no-impact home-based business is defined as one whose total number of employees does not exceed the occupancy limit for a residential property. Business activities are limited to the lawful sale of goods and services, they do not generate on-street parking or cause significant increases in traffic through a residential area, all activities occur inside the residential dwelling, and no activities are visible from the street. Fenced yards that cannot be viewed from the street can also be used for business purposes under the provisions of the ALEC model legislation (10).

The ALEC bill bars municipalities from prohibiting no-impact home-based business activities and does not allow local governments to require any type of permit, license, variance, or other prior approval from a municipality to operate. It also protects these businesses from rezoning and fire safety requirements in detached dwellings. It does not prohibit a municipality from establishing health and safety requirements for home-based businesses (11).

In 2023, the Arizona-based Goldwater Institute produced similar model legislation called the Home-Based Business Fairness Act. It requires that no-impact home-based businesses (i.e., those that do not cause a disruption to the residential area they are located in) comply with health and safety regulations, building codes, pay all applicable taxes, abide by local traffic, parking, and noise ordinances, and adhere to occupational licensing standards. They are not required to obtain any other home occupational licenses or permits. All businesses that do have an impact on neighborhoods would be regulated through existing, state, county, and municipal laws (12).

9 Ibid

10 American Legislative Exchange Council, “The Home-Based Business Fairness Act,” January 8, 2021, https://alec.org/model-policy/the-home-based-business-fairness-act/,

11 Ibid

12 Goldwater Institute, “Home-Based Business Fairness Act- Promoting common-sense, modern, and flexible employment while protecting neighborhoods”,

Policy Recommendations for Alabama Lawmakers

Create a

“No-Impact”

Designation for Certain Home-Based Businesses

Not only do many home-based businesses present no health and safety risk to the general public, but they can also serve as a catalyst for entrepreneurship and provide needed goods and services in underserved communities. The Alabama Legislature should enact policy reforms that reduce the county and municipal regulatory burdens on these small business owners by specifying that no-impact home-based businesses do not require licenses, permits, zoning variances, etc., if they pose no risk to the public.

Tie Home-Based Business Performance Standards to Measurable Health and Public Safety Impacts

Too often, home-based business ordinances are “varying degrees of too vague, too strict, or unenforceable.” Ultimately decisions about whether a home-based business is allowed to continue operating are left to the whims of enforcement officials. Investigations of home-based businesses often come as the result of a complaint by neighbors, leading to the potential that https://www.goldwaterinstitute.org/wp-content/uploads/2018/01/HBB-Fact-Sheet-1-30-18.pdf, (accessed December 26, 2023).

current laws are only applied in response to those complaints, and not evenly across the board. The state, county, and municipal governments should put clear and uniform performance standards in place, which are tied to measurable impacts on health and public safety. If there is no measurable impact, then those businesses should be allowed to operate without government interference13 .

Set Profession Specific Regulations for Home-Based Businesses

The potential wide variety of home-based businesses means that they are unique and should not be lumped into the same broad categories as large, incorporated businesses. While many home-based businesses pose no public health and safety risk, there are those such as childcare that inherently come with health and safety concerns. For these types of small businesses, the Legislature should adopt specific home-based business regulations that address those health and safety risks while making regulatory requirements the least burdensome as possible14 .

Conclusion

Alabamians should have the ability to create and operate no-impact home-based businesses with minimal interference from state and local governments. All citizens of the state can benefit from allowing entrepreneurship to flourish in Alabama.

13 Olivia Gonzalez and Nolan Gray, “Zoning for Opportunity: A Survey of Home-Based-Business Regulations”, The Center for Growth and Opportunity at Utah State University, March 11, 2020, https://www thecgo org/research/zoning-for-opportunity-a-survey-of-home-based-business-regulations/ , (accessed January 5, 2024).

14 Ibid.

Improve Regulatory Oversight and Transparency

Background

The common perception of most Alabamians is likely that the state legislature enacts laws and then agencies are tasked with enforcing those laws as passed by lawmakers. Each non-local piece of legislation is accompanied by a fiscal note from the Legislative Services Agency, providing its best guess at what the short and long-term cost impacts of a new or amended law may be.

And while this is true at a basic level, often legislation is more of a framework for how a law will be implemented, without each provision outlined in great detail. In reality, bureaucrats working for Alabama’s myriads of state agencies are responsible for developing the rules and regulations for a law once it has been enacted by the legislature and signed into law by the Governor.

While laws in general are important, the regulations accompanying those laws that are developed after passage are equally important. Sometimes those regulations can come with high costs for Alabama’s taxpayers and business owners. At the very least, proposed regulations and a detailed cost analysis of those regulations should be readily available to the public. If the cost of a regulation exceeds a certain threshold, there should be a vote of citizens direct representation, the Alabama Legislature, before it can be implemented.

Thankfully, there is a solution to bring more clarity and oversight into the regulatory process, the Regulations form the Executive in Need of Scrutiny Act (REINS Act).

The REINS movement began at the federal level shortly after the rise of the Tea Party movement that began within the Republican Party in 2009.

While Congress already has the authority to issue resolutions of disapproval and nullify agency regulations that it deems harmful, under current federal law a regulation can only be disapproved of after it has been implemented. The REINS act would allow Congress to preemptively halt the enactment of regulation before they take effect. Under the provisions of the act, before any major rule, regulation, or mandate requiring financial expenditures from citizens, state or local government can go into effect Congress must first approve it. A major regulation is defined as having impacts to the U.S. economy of $100 million or more1 .

One of the key arguments in favor of the REINS Act relates to enforcement of the nondelegation doctrine, a principle that states that legislative bodies cannot delegate their powers to executive branch agencies or private entities. By giving agencies broad regulatory powers, federal and state lawmakers are consistently violating this principle2 .

The federal REINS Act has been introduced during each session of Congress since 2011 but has failed to be enacted.

1 Ballotpedia, “REINS-Style State Laws”, https://ballotpedia org/REINS-style state laws, (accessed December 9, 2024).

2 Ibid.

However, the fact that the federal government has not implemented the REINS Act does not stop state governments from taking similar steps. Thus far, at least four states have adopted REINS Act style laws at the state level.

Current Law

Rulemaking authority is governed by the Alabama Administrative Procedures Act (APA) (sections 41-22-1 through 41-22-27 of the Code of Alabama). The Joint Committee on Administration, which is comprised of members of the Legislative Council, is responsible for overseeing the process3 . Under current law, an agency must give at least 35 days’ notice of its intended rulemaking action, i.e., adopting, amending, or repealing a rule, with a public comment period included. All proposed rules must be published in the Alabama Administrative Monthly. The Legislative Services Agency is responsible for maintaining the Alabama Administrative Code, and all final rules must be certified by LSA before they can take effect.

All rulemaking authority under the APA is subject to the legislative oversight of the Joint Committee on Administration. LSA assists the committee in determining if a rule submission clearly exceeds an agency ’ s rulemaking authority.

The rulemaking process begins with the submission of a proposal to LSA including the proposed language of the rule. If the agency anticipates that the proposed rule will have an economic impact, then it is required to attach an economic impact statement.

The economic impact statement must include a determination of the need for the rule and its expected benefit, a determination of the costs and benefits associated with the rule, the effect of the rule on competition, the effect of the rule on cost of living and doing business in the area that it will be implemented, the effect of the rule on employment, the source of revenue being used to implement the rule, an analysis of the short and long-term economic impact upon all persons substantially affected by the rule, any uncertainties associated with the estimate, the effect of the rule on

3 See section 41-22-3, Code of Alabama.

the environment and public health, and the potentially detrimental effect on the environment and public health if the rule is not implemented4 .

Once the date for comments and completion of public notice expires, final certification of the rule must occur within 90 days. If it does not occur within the 90 day period, the agency is required to start the process over. After considering all public comments, the agency may adopt the rule with or without changes. Once the final rule has been transmitted to LSA, it will generally go into effect 45 days after being published in the Alabama Administrative Monthly. At any point in time before the rule goes into effect, the Joint Committee on Administration may convene a hearing to disapprove the rule or send it back to the agency with suggested amendments. If the committee takes no action, it goes into effect at the end of the 45-day waiting period5 .

Reform in Other States

Wisconsin

In 2017 the Wisconsin Legislature enacted the Wisconsin Regulations from the Executive in Need of Scrutiny (REINS) Act. Under the law, agencies must first submit a statement of scope to the Wisconsin Department of Administration which then determines whether an agency has the authority to issue the rule before it is presented to the governor. An agency cannot begin drafting a rule until the statement of scope is approved6 .

Next, if the proposed rule would have more than $10 million in implementation and compliance costs over two years, with exceptions, it may not be promulgated without legislative approval. The process also allows for the state’s Joint Committee for Review of Administrative Rules to contract for and conduct an independent economic impact analysis of the proposed rule. The cost of the analysis must be paid by the agency if it varies by more than 15% from the agency ’ s analysis7 .

4 See Alabama Legislature, “Rulemaking under the Alabama Administrative Procedures Act”.

5 Ibid

6 Ballotpedia, “REINS Act (Wisconsin), https://ballotpedia org/REINS Act (Wisconsin), (accessed December 10, 2024).

7 Ibid.

Once the Joint Committee for Review of Administrative Rules has given its approval, the proposal may be submitted to the governor for final approval8 .

Florida

In 2010 the Florida Legislature enacted House Bill 1565, another REINS style act.

The law requires an agency to prepare a statement of estimated regulatory costs (SERC) for any proposed rule that is expected to cost in excess of $200,000 in the first year of implementation or more than $1,000,000 over a five-year period. The SERC must include the estimated impact on economic growth, private-sector job creation or employment, or private sector investment, an analysis of business competitiveness, any transactional costs likely to be incurred by individuals, entities, or small businesses, and a description of any regulatory alternatives9 .

Any agency rule that exceeds the $200,000 of cost over one-year or $1,000,000 in cost over five-year threshold must be approved by the Legislature.

In 2024, Kansas and Indiana followed the examples of Wisconsin and Florida by enacting their own REINS style laws. In Kansas, lawmakers are now required to approve any rule with implementation and compliance costs of more than $1,000,000 over a five-year period10 . Indiana law does not require approve by the full legislature but does require approval by the Budget Committee for any proposed rule with estimated implementation and compliance costs of more than $1,000,000 over two-years. The governor may not approve such rules until the completion of the Budget Committee’s review11 .

Opportunities for Reform

Alabama lawmakers should consider strengthening the current administrative review process to increase transparency and to lessen the

8 Ibid.

9 Stephen Trainer, “Research Note: Florida’s REINS Act”, Platte Institute, June 24,2024, https://platteinstitute.org/research-note-floridas-reins-act/, (accessed December 10, 2024).

10 Ballotpedia, “Kansas REINS-style state law”, https://ballotpedia.org/Kansas REINS-style state law, (accessed December 10, 2024)

11 Ballotpedia, “Indiana REINS=style state law”, https://ballotpedia.org/Indiana REINS-style state law, (accessed December 10, 2024).

consequences of new rules on the state’s economy, businesses, and individuals.

First, lawmakers should take a more active role in determining whether an agency has the authority to make a rule in the first place. This is currently done through a recommendation by LSA based upon the proposed rule. An agency ’ s authority should be determined before a draft rule is ever written. A proposal similar to Wisconsin’s where a statement of scope must be submitted, and authority must be determined, before the rule is written could help alter and or stop bad rules at the beginning of the process.

Next, there should be an opportunity for the Joint Committee on Administration to contract for and conduct an outside analysis of the impact of proposed rules. While it may be in the best interest of the agency for the Committee to simply accept its cost analysis, it is not in the best interest of Alabamians, especially in the case of rules that are expected to have a significant impact.

It is also possible to sunset regulations. The ALEC model policy in that regard would require rules and regulations to automatically sunset after five years unless the rules or regulations are amended or reapproved by the state legislature or subject to a different termination schedule.

Some states are implementing an ALEC model called the Accountability in Rule Making Act seeks to increase the accountability of the executive in rulemaking decisions by requiring the governor of a given state to approve final regulations before an agency can publish a new rule.

In addition, many states have discussed enacting their own Chevron deference law. The model restores judicial autonomy by prohibiting state courts and state administrative hearing or appeal officers from exercising bias and deferring to a state agency ’ s interpretation of a state statute or regulation. After the customary tools of interpretation have been applied to discern the meaning of a statute or regulation, the judge or review officer must exercise remaining doubt in favor of a reasonable interpretation that limits the scope of agency power and maximizes individual liberty.

Finally, lawmakers should have approval and veto power over rules that exceed a certain cost threshold. Three of four states that have enacted REINS style laws use a threshold of $200,000 to $500,000 per year, while Wisconsin used a much higher threshold of $5 million per year. While it is

up to the Legislature to determine what threshold will work best for Alabama, it should be low enough to protect Alabamians from any significant impact.

Conclusion

Whether intentionally or unintentionally, regulations and rules made by unelected employees at state agencies can have a significant negative impact on Alabama’s economy, businesses, and citizens. Before any regulation with a significant cost impact is allowed to become effective, it should first be debated and approved or denied by the lawmakers elected to represent all Alabamians.

State Budgets

Background

When fiscal year 2024 ended on September 30, 2024, Alabama’s state government had again collected more revenue from taxpayers than at any point in state history.

According to preliminary data from the State Treasurer, the state’s Education Trust Fund (ETF) and General Fund (GF) budgets collected a combined $14.115 billion in tax revenues last year (1).

After experiencing historic growth over the past several years (79.8% from 2014-2023) ETF revenue growth was stronger than in 2023, increasing by 2.12% ($221 million) over last year ’ s $10.428 billion in net revenue. The largest contributor to the increase in net ETF revenues was that the state collected approximately $235 million more in combined individual and corporate income tax receipts in 2024 than the previous year. Corporate and Individual income tax receipts are the largest source of ETF revenues. The state’s general sales and use tax receipts decreased by approximately $60 million in 2024 (2).

Meanwhile, the much smaller GF budget continued to see strong revenue growth of 7.02% in 2024, bringing in an additional $227.3 million compared to 2023. The largest component of the surge in GF revenue was due to a $104.8 million increase in interest income from state investments and a $49.5 million (8.9%) increase in insurance premium tax receipts (3).

1 See open.alabama.gov, State of Alabama Accounting and Resource System, “Comparative Summary of Revenues by Fund”, October 1, 2024

2 Ibid.

3 Ibid.

Despite slower ETF growth than in recent years, the fund still ended FY 2024 with a projected balance of nearly $1.9 billion. The GF was projected to have a surplus of more than $539 million as the new fiscal year began (4).

How Will Large Surpluses Be Used in 2024?

Of the nearly $1.9 million ETF budget surplus, much of it has already been committed. Over $113 million will be transferred to the ETF Budget Stabilization Fund, $873.8 million is to be transferred to the Advancement and Technology Fund, and $349.5 million will be transferred to the Educational Opportunities Reserve Fund, leaving approximately $524 million available for ETF supplemental appropriations5 .

Senate education budget committee chairman Arthur Orr (R-Decatur) has been noncommittal on what the priorities for that bill might be but pointed towards $50 million in school choice funding approved by the CHOOSE Act during the 2024 regular session, and a looming $134 million shortfall in the state education employee’s health insurance plan. However, Orr has indicated that it would be better to fund those priorities through future ETF revenue growth rather than through the form of a one-time supplemental appropriation6 .

FY 2025 ETF spending was set at $9.348 billion during the 2024 Regular Session (7). An issue with the current system is that when there is a large ETF surplus, such as in the past several years, much of it has already been committed to the various reserve funds. Therefore, there is less that could be returned to taxpayers through lower tax rates. Of billions of dollars in surplus budgets has been spent on surplus spending. After the statutorily required transfers, the remaining surpluses have been used to increase ETF spending levels through supplemental appropriations bills, pushing ETF spending higher and higher each year.

4 Alabama Legislative Services Agency, “State General Fund Budget Conditions and Outlook”, August 13, 2024, https://alison.legislature.state.al.us/files/pdf/lsa/Fiscal/BudgetHearings/2024-summer/LSA-2.pdf.

5 Alabama Legislative Services Agency, “Allocation of ETF Excess Funds”, November 4, 2024, https://alison legislature state al us/ETF-waterfall, (accessed December 4, 2024)

6 Mary Sell, “General Fund, ETF supplemental spending bills expected in 2025”, Alabama Daily News, September 20, 2024, https://aldailynews com/general-fund-etf-supplemental-spending-bills-expected-in-2025/, (accessed December 3, 2024).

7 See Alabama Legislative Services Agency Fiscal Division, FY 2025 ETF Budget Spreadsheet as Enacted.

The GF budget is expected to have more than $539 million in excess revenues that could be spent during the 2024 session. Because of a provision included in the FY 2025 GF budget, $200 million of that surplus will go towards ongoing prison construction projects, while $35 million has been set aside for the construction of a new State House. Approximately $13 million in other conditional appropriations were approved during the FY 2025 budget cycle8 , leaving around $291 million that could be available for supplemental appropriations.

Senate General Fund budget committee chairman Greg Albritton (R-Range) has indicated that possible funding priorities could include increases to the state employee’s retirement system as well as to offset increased state employee healthcare costs (9).

There appears to be a strong likelihood that at least a portion of the GF budget surplus will go towards addressing those ballooning costs.

Potential for Reform

Cap Spending Increases to Population and Inflation Growth

To slow the growth of state government, lawmakers should consider implementing a spending cap tied to population and inflation growth. This approach would essentially freeze inflation-adjusted spending over time, reducing budget uncertainty for taxpayers and lawmakers as well. It would also ensure that more money is left in the private sector where it will experience its greatest rate of return10 .

Since 2014, average annual combined base ETF and GF spending growth has been more than 4.5%. In the last five years, it has averaged just under 6.4%. In FY 2025, combined spending is set to increase by 7.6% compared to 202411 . Meanwhile, population has grown much more slowly, averaging 0.76% over the past five years. Increases in inflation have outpaced

8 Mary Sell, “General Fund, ETF supplemental spending bills expected in 2025”, Alabama Daily News, September 20, 2024, https://aldailynews.com/general-fund-etf-supplemental-spending-bills-expected-in-2025/, (accessed December 3, 2024).

9 Ibid

10 Vance Ginn, “Sustainable State Budget Revolution Across the U.S.” Vance Ginn Economic Consulting, October 15, 2024, https://www vanceginn com/letpeopleprosper/responsible-state-budgets-across-the-us, (accessed December 16, 2024).

11 API calculation based on data from the Alabama Legislative Services Agency.

population growth over the past five years, averaging 4.2% annually, though large increases in 2021 and 2022 were brought on by the COVID-19 pandemic and related economic actions taken by the federal government. In other words, those years are an outlier. From 2015-2019 annual inflation averaged 1.82%.

Using population plus inflation as a spending cap would significantly limit growth compared to recent years. For example, if 2025 spending has been limited by such a cap, it would have been restricted to growth of no more than 3.4%, approximately 4.2% below the FY 2025 enacted levels. A population plus inflation spending cap would have saved taxpayers an estimated $496 million in FY 2025 alone, with those savings compounding each year that the cap is in place. However, this approach would still leave flexibility for lawmakers, allowing spending to rise when there are spikes in population and/or inflation.

Capping spending increases based on population plus inflation growth is a measured approach that does not force lawmakers to cut current spending levels, but also will reduce the future burden placed on Alabama’s taxpayers.

Conclusion

While it is too early to determine exactly how and how much of the more than $2 billion state revenue surplus will be spent in 2025, the bottom line remains that the state collected more tax dollars than ever from Alabama citizens last year. Additional government funds ultimately belong to the citizens that paid them to the state. Surpluses should be used to decrease the future tax burden placed on all Alabamians and/or focused on projects that will have the greatest overall benefit for all citizens. They should not be used to further increase the size and scope of Alabama’s state government.

The Alabama Policy Institute will continue to advocate for lower taxes and responsible fiscal policy as these decisions are being made.

Tax Cuts

Background

In fiscal year 2024 Alabama collected more revenue from taxpayers than at any point in state history, a combined $14.115 billion last year (1).

After experiencing historic growth over the past several years (79.8% from 2014-2023) ETF revenue growth increased by 2.12% ($221 million) over last year ’ s $10.428 billion in net revenue. The largest contributor to the increase in net ETF revenues was that the state collected approximately $235 million more in combined individual and corporate income tax receipts in 2024 than the previous year. Corporate and Individual income tax receipts are the largest source of ETF revenues. The state’s general sales and use tax receipts decrease by approximately $60 million in 2024 (2).

1 See open alabama gov, State of Alabama Accounting and Resource System, “Comparative Summary of Revenues by Fund”, October 1, 2024.

2 Ibid.

Meanwhile, the much smaller GF budget continued to see strong revenue growth of 7.02% in 2024, bringing in an additional $227.3 million compared to 2023. The largest component of the surge in GF revenue was due to a $104.8 million increase in interest income from state investments and a $49.5 million (8.9%) increase in insurance premium tax receipts (3).

Despite slower ETF growth than in recent years, the fund still ended FY 2024 with a projected balance of nearly $1.9 billion. The GF was projected to have a surplus of more than $539 million as the new fiscal year began (4).

Rather than increasing fiscal year 2025 or 2026 spending levels, lawmakers should use the state multibillion-dollar surplus to reduce the future tax burden of all Alabamians.

Current Law

In Alabama, all income earned by an individual is taxable. For single filers, the first $500 in income is taxed at 2%, the next $2,500 is taxed at a rate of

3 Ibid.

4 Alabama Legislative Services Agency, “State General Fund Budget Conditions and Outlook”, August 13, 2024, https://alison.legislature.state.al.us/files/pdf/lsa/Fiscal/BudgetHearings/2024-summer/LSA-2.pdf.

4%, and all earned income above $3,000 is taxed at a 5% rate. The minimum personal tax exemption for a single filer is $1,500 per year (5).

For married filers, the personal exemption is a minimum of $3,000 per year. After that, married person filing a joint return pay 2% taxes on the first $1,000 earned, 4% on the next $5,000 in wages, and 5% for all earned income above $6,000 per year (6).

While many of the nation’s lawmakers have used historic state revenue surpluses to pursue historic individual income tax relief over the past few years, Alabama has lagged behind. Alabama is already at a competitive disadvantage in attracting new residents to the state compared to Tennessee and Florida, which levy no individual income taxes. Our neighbors in Georgia and Mississippi have also enacted historic income tax cuts over the past few years, with Mississippi Governor Tate Reeves pledging to continue his push to eliminate all state individual income taxes before the end of his tenue in office (7).

5 Alabama Department of Revenue, “Individual Income Tax”, https://www revenue alabama gov/tax-types/individual-income-tax/

6 Ibid.

7 Justin Bogie, “Lowe taxes, better education are keys to attracting business to Alabama, not incentives”, Alabama Today, October 4, 2022, https://altoday.com/archives/47571-justin-bogie-lower-taxes-better-education-are-keys-to-attracting-bu siness-to-alabama-not-incentives, (accessed December 18, 2023).

In terms of corporate income taxes, all annual net income is taxed at a rate of 6.5%. Deductions are allowed for all federal income taxes paid or accrued (8). On paper, Alabama has one of the highest corporate income tax rates in the Southeast, ranking ahead of Georgia, Florida, Mississippi, South Carolina, North Carolina, and Kentucky (9).

In practice, Alabama’s effective tax rate is lower than the 6.5% statutory rate because Alabama allows businesses to deduct federal taxes paid from their state tax bills. However, as was seen after the passage of the federal Tax Cuts and Jobs Act of 2017 (TCJA), this can cause unpredictability for the state’s businesses and government. Because the TCJA reduced federal corporate income tax rates, businesses had less to deduct from their state

8 Alabama Department of Revenue, “Corporate Income Tax”, https://www.revenue.alabama.gov/tax-types/corporate-income-tax/.

9 Janelle Fritts, “State Corporate Income Tax Rates and Brackets for 2023”, Tax Foundation, January 24, 2023, https://taxfoundation.org/data/all/state/state-corporate-income-tax-rates-brackets-2023/, (accessed December 18, 2023).

income tax rates, meaning that their Alabama tax bills increased10 . From 2019-2023 net corporate income tax collections increased by 166% (11).

With many of the provisions of the TCJA set to expire at the end of 2025, Alabama’s effective corporate income tax rate will be lower than the 6.5% statutory rate and below many Southeastern states. However, having a higher statutory rate than neighboring states puts Alabama at a competitive disadvantage in attracting new businesses.

Beyond individual and corporate income tax reforms, Alabama lawmakers should build on the progress of the past few years and continue to find ways to further reduce the tax burden of Alabamians.

Suggested Tax Reforms

10 Justin Bogie, “Halfway through the legislative session, what have lawmakers done?”, Alabama Today, March 25, 2021, https://altoday.com/archives/39601-justin-bogie-halfway-through-the-legislative-session-what-have-law makers-done, (accessed December 18, 2023)

11 Alabama Legislative Services Agency Fiscal Division, “A Legislator’s Guide to Alabama’s Taxes”, March 2024, https://alison.legislature.state.al.us/files/pdf/lsa/Fiscal/TaxGuide/2024 Tax Guide.pdf.

Reduce Individual Income Tax Rates

During the 2023 Regular Legislative Session, Representative Danny Garrett (as well as Senator Arthur Orr) introduced several proposals to reduce the state’s individual income tax burden.

House Bill 115 would have reduced the state’s top income tax bracket from 5% to 4.95% over a five year phase in period, saving an estimated $57.3 million once fully implemented (12). An accompanying bill (House Bill 116) would have eliminated the state’s 2% tax bracket, eliminating income taxes on the first $500 and $1,000 earned for single and married filers respectively. Estimated savings from this proposal were $25 million per year (13). No similar proposals were introduced during the 2024 regular session.

Lawmakers should build on these proposals and consider moving towards a flat tax rate of 3.95%. Both Georgia and Mississippi have enacted legislation to utilize a flat income tax structure and reducing Alabama’s rate to 3.95% would make Alabama’s rate the lowest in the region, besides states that assess no state income tax.

Reduce Corporate Income Tax Rate to Improve Competitiveness

In the COVID-19 shortened 2020 regular session, Senator Dan Robets and Representative Danny Garrett introduced bills that would have reduced the state’s statutory corporate income tax rate from 6.5% to 4.75%. The bills would have also eliminated a corporation’s ability to deduct federal income taxes paid from their Alabama tax bills (14).

In terms of a company ’ s bottom line, reducing the tax rate to 4.75% is unlikely to have a significant impact on the amount of taxes owed each year. However, it would make tax bills more predictable since they would no longer be tied to the federal tax code.

Reducing the corporate income tax rate would also make Alabama more competitive in attracting new businesses and industries to the state. As stated previously, Alabama has one of the highest statutory corporate income tax rates in the Southeast.

12 See House Bill 115, Alabama Legislature 2023 Regular Session

13 See House Bill 116, Alabama Legislature 2023 Regular Session.

14 See Senate Bill 249, Alabama Legislature 2020 Regular Session.

According to a 2020 report from the Joint Legislative Task Force on the Tax Cuts and Jobs Act, “Alabama gets little to no credit for its lower effective tax rates resulting from the FIT (Federal Income Tax) deduction. We are advised that it is a meaningful competitive disadvantage in state comparisons by economic developers and companies looking to locate in the Southeast. Alabama will never know how often it has been “deselected” in a business location decision because it is perceived to have one of the highest corporate income tax rates in the Southeast (15).”

Fully Repeal Business Privilege Tax

Alabama’s business privilege tax is a state government fee levied for the privilege of being organized under the laws of Alabama or doing business in the state. It is assessed as a percentage of a company ’ s net worth with rates ranging from 0.025% to 0.175%, however, prior to tax year 2023, every business organized in the state was required to pay a minimum privilege fee of at least $100 each year (16).

During the 2022 regular session, Alabama lawmakers repealed the minimum privilege tax, with the change being fully implemented during the 2024 tax year. The repeal will save businesses an estimated $23 million each year beginning in 2024 (17).

No company should be required to pay the state a fee purely for the privilege of doing business within Alabama’s borders. Lawmakers should continue to pursue a full repeal of the tax, saving Alabama businesses more than $200 million each year (18).

Permanently Extend Overtime Tax Exemption

In 2023, Representative Anthony Daniels championed the first in the nation repeal of state income taxes on earned overtime wages. This

15 Joint Legislative Task Force on the Tax Cuts and Jobs Act, “Final Report”, February 18, 2020, https://www.bcatoday.org/wp-content/uploads/2020/03/JTF TCJA final Report.pdf.

16 Ashley G. White, “Alabama to Phase out Minimum Business Privilege Tax Beginning in 2023”, BMSS Advisors and CPAs, June 15, 2022, https://www.bmss.com/alabama-to-phase-out-minimum-business-privilege-tax-beginning-in-2023/, (accessed December 18, 2023).

17 See House Bill 391, Alabama Legislature 2022 Regular Session

18 Alabama Legislative Services Agency Fiscal Division, “A Legislator’s Guide to Alabama’s Taxes”, March 2023, https://alison-file.legislature.state.al.us/pdfdocs/lsa/Fiscal/TaxGuide/2023 Tax Guide.pdf.

innovative approach to tax reform will encourage Alabamians to work longer hours and could help fill the state’s labor shortage as well as boost Alabama’s lagging labor participation rate. The overtime tax repeal saved taxpayers an estimated $230 million during the first nine months of 2024 (19).

While the overtime tax repeal was a victory for the state’s hourly workers, the exemption will only run from January 1, 2024, through June 30, 2025 (20).

Overtime income taxes are not a significant source of revenue for the state. In an effort to further incentivize Alabamians to work and allow them to keep more of the money that they earn, the overtime tax repeal should be made permanent.

Ensure 2% Grocery Tax Cut is Fully Implemented

House Bill 479 by Representative Danny Garrett, enacted during the 2023 regular session, reduced the state’s grocery tax from 4% to 2%. The first 1% of that tax cut began on September 1, 2023, with the second 1% reduction slated to being as early as September 1, 2024. However, the second phase of the grocery tax repeal did not occur because ETF revenue growth, as estimated by the Director of Finance and Legislative Fiscal Officer, is not projected to be at least 3.5% in 2025. In FY 2024 ETF revenues grew by 2.12%.

From 2015-2024 average annual ETF growth was approximately 6.4%. However, 2021 and 2022 were well above average years. If those two years are excluded from the average, the average annual growth rate drops to about 3.5%, meaning that it could take several years for the grocery tax reduction to be fully implemented.

Given that Alabama’s government has a more than $2 billion surplus entering fiscal year 2024, lawmakers should ensure that the 2% grocery tax repeal is fully implemented, regardless of projected revenues. A full repeal

19 Mike Cason, Alabama overtime tax exemption costs schools $230 million in 9 months: Will lawmakers let it expire?”, AL.com. December 16, 2024, https://www al com/news/2024/12/alabamas-popular-overtime-tax-exemption-costs-schools-230-millio n-in-9-months-what-will-lawmakers-do.html, (accessed December 16, 2024).

20 See House Bill 217, Alabama Legislature 2023 Regular Session.

will provide at least an additional $166 million ($318 million total) to all Alabamians (21).

Conclusion

The Alabama Legislature has made incremental progress towards providing tax relief to citizens over the past two years. Still, there is much more work to be done. Lawmakers should continue to pursue bolder tax reform initiatives in the 2024 regular session. Doing so will allow citizens to keep more of their hard earned money as well as make the state more competitive in attracting new residents and business opportunities to Alabama.

21 See Legislative Service Agency Fiscal Division, Fiscal Note to House Bill 479, 2023 Regular Session.

Medicaid Expansion Background

The Medicaid expansion debate in Alabama goes back a decade, when states first became eligible to expand programs under the provisions of Obamacare (1). To date, forty-one states (including the District of Columbia) have expanded coverage (2). As more states have signed on to Medicaid expansion, there has been a push amongst Alabama’s proponents for the state to follow suit. The American Rescue Plan Act of 2021 (ARPA) increased the matching rate for new expansion states from 90% to 95% over the first two years, making expansion more attractive for some lawmakers. The theme amongst Medicaid expansion proponents is that it would expand medical coverage for Alabamians and that it would mean an influx of new federal dollars into state government and potentially increase other sources of revenue, such as income and sales tax (3). Having access to quality medical care should be of the utmost priority to lawmakers and citizens alike. However, the issue of Medicaid expansion is much more complicated than the question of how much money state government will receive in return. The long-term impacts to the State General Fund Budget, Alabama’s

1 Congressional Research Service, “Overview of the ACA Medicaid Expansion”, June 9, 2021, https://crsreports.congress.gov/product/pdf/IF/IF10399#:~:text=Note%3A%20ACA%20%3D%20Patien t%20Protection%20and%20Affordable%20Care%20Act.&text=Since%20January%201%2C%202014%2C %20states,Medicaid%20expansion%20at%20that%20time, (accessed December 20,2023).

2 Kaiser Family Foundation, “Status of State Medicaid Expansion Decisions: Interactive Map”, https://www kff org/medicaid/issue-brief/status-of-state-medicaid-expansion-decisions-interactive-map /, (accessed December 20,2023).

3 Andrea Tinker, “New report: Medicaid expansion would help Alabama workforce and economy ” , Alabama Public Radio, September 27, 2023, https://www.apr.org/news/2023-09-27/new-report-medicaid-expansion-would-help-alabama-workforce -and-economy, (accessed December 20,2023).

lagging labor participation rate, and the state’s ability to run the Alabama Medicaid program as it best sees fit must also be weighed (4).

Another contributing factor to the push for Medicaid expansion is a report from the Alabama Hospital Association issued in February 2023, which claimed that since the beginning of the COVID-19 pandemic Alabama hospitals have lost an estimated $1.5 billion in revenue (5). The assumption is that Medicaid expansion would help to bolster the bottom line of hospitals and other providers.

It is important to note that hospitals received hundreds of millions of dollars in federal stimulus funds. Alabama appropriated a combined $218.5 million in state Coronavirus Aid, Relief, and Economic Security Act and ARPA funds towards hospitals (6). Alabama medical providers also directly received over $745 million in stimulus funds directly from the federal government’s Provider Relief Fund, a program which is ongoing (7).

There is no clear data that shows Medicaid expansion would make hospitals facing the risk of closure more financially viable. This is in part because some Alabamians who currently have private insurance, which pays higher provider reimbursement rates, would move to lower paying Medicaid plans (8).

4 Alabama Policy Institute, “2023 Medicaid Expansion Report”, March 2023, https://alabamapolicy org/wp-content/uploads/2023/02/API-2023-Medicaid-Expansion-Report pdf

5 Julia Avant, “Report finds Alabama hospitals lost $1.5B over last 3 years ” , WSFA News, February 2, 2023, https://www.wsfa.com/2023/02/03/report-finds-alabama-hospitals-lost-15b-over-last-3-years/, (accessed December 20, 2023.

6 See State of Alabama, Budget and Expenditures, Coronavirus Relief Fund and Fiscal Recovery Fund.

7 See U S Health Resources and Services Administration, Provider Relief Fund Payments and Data, General Distributions.

8 Brian Blase and Drew Gonshorowski, “Resisting the Wave of Medicaid Expansion: Why Florida is Right”, Paragon Health Institute, December 2023, https://paragoninstitute.org/wp-content/uploads/2023/12/Resisting the Wave Florida Medicaid Bla se Gonshorowski FOR RELEASE V2.pdf.

According to the Alabama Hospital Association, an estimated 300,000 Alabamians will gain healthcare coverage if the state expands Medicaid9 . However, a recent study from the Paragon Health Institute found that “Medicaid recipients have more difficulty obtaining primary care appointments, experience longer wait times for specialty care, and wait longer for ambulances.” Because it becomes harder to get medical appointments (with more people competing for space) expansion results in a significant increase in emergency room visits. Paragon went on to say that “expansion could lead to worse overall health outcomes if it reallocates services away from people who need them more to people who benefit less from the additional services (10).”

The Case Against Expansion

Impact to the State General Fund Budget

9 Alexander Willis, “More than 101,000 Alabamians removed from Medicaid since June”, Alabama Daily News, December 20, 2023, https://aldailynews.com/more-than-101000-alabamians-removed-from-medicaid-since-june/#:~:text=E xpanding%20Medicaid%2C%20according%20to%20the,care%20on%20the%20private%20market, (accessed December 21, 2023).

10 Brian Blase and Drew Gonshorowski, “Resisting the Wave of Medicaid Expansion: Why Florida is Right”, Paragon Health Institute, December 2023, https://paragoninstitute.org/wp-content/uploads/2023/12/Resisting the Wave Florida Medicaid Bla se Gonshorowski FOR RELEASE V2.pdf.

According to estimates of the costs of Medicaid expansion in Alabama, within six years the state would be spending $243 million more annually on its state Medicaid program. The additional $243 million is the amount needed to draw down enhanced federal matching dollars (11).

However, this figure could just be the start to the costs incurred by Alabama’s state General Fund budget. The costs of the federal Medicaid program are projected to grow by nearly 54% over the next 10 years. Between 2008 and 2022, annual federal Medicaid spending increased by 159% (12). Paragon Health Institute found that Medicaid enrollment in expansion states has exceeded projections by more than 50% on average. Expansion costs have exceeded projections by an average of 33% (13). Under a low-end projection, Alabama would have to invest about $2.5 billion more into its Medicaid program in the first ten years of expansion, with costs continuing to rise in subsequent decades.

While it is true that additional money will flow into Alabama’s Medicaid program if the state expands coverage, all those new federal dollars would have to be put back into that same program. They could not be used to pay for other General Fund expenditures. At the same time, the state would be required to use more than $200 million per year (with costs increasing each year) to draw those federal dollars down to the state level. That leaves a large hole in the General Fund that will either have to be filled, or spending in other areas will have to be reduced significantly.

Numerous expansion states have increased provider and hospital fees as a means of dealing with increased budget costs. Provider tax revenues go back into the state Medicaid agency, not for other general fund uses. Those fees could be passed on to patients and increase the costs of health care in

11 Justin Bogie, “Consequences of Medicaid expansion go beyond dollars and cents”, Alabama Policy Institute, November 16, 2022, https://alabamapolicy.org/2022/11/16/consequences-of-medicaid-expansion-go-beyond-dollars-and-cen ts/, (accessed December 20,2023)

12 See Congressional Budget Office, Budget and Economic Data, 10-Year Budget Projections.

13 Brian Blase and Drew Gonshorowski, “Resisting the Wave of Medicaid Expansion: Why Florida is Right”, Paragon Health Institute, December 2023, https://paragoninstitute.org/wp-content/uploads/2023/12/Resisting the Wave Florida Medicaid Bla se Gonshorowski FOR RELEASE V2.pdf.

general (14). If Alabama does not pursue similar fee/tax increases, all citizens could share in Medicaid expansion costs.

Effects on Labor Participation

As of November 15, 2024, Alabama’s labor participation rate was 57.6%, one of the lowest in the nation (15). In practical terms, this means that 42.4% of Alabama’s able working-age population has left the workforce and has not actively sought employment in at least 30 days.

Medicaid expansion could further exacerbate the state’s labor participation problem. Some Alabamians work solely to have access to health insurance. Medicaid expansion could provide a disincentive to work for some citizens, further degrading labor participation. This could impact Alabama’s ability to expand existing businesses or attract new businesses to the state (16).

Lawmakers should be considering proposals that incentivize more Alabamians to enter the state’s workforce, not providing additional means to remain at home.

Increased Dependency on the Federal Government

By expanding Medicaid, Alabama would become more dependent on the federal budget to supplement state spending. Given the current federal budget situation, this is a tenuous proposal at best.

14 Bryce War, “The Impact of Medicaid Expansion on States’ Budgets”, The Commonwealth Fund, Issue Brief, May 5, 2020, https://www.commonwealthfund.org/publications/issue-briefs/2020/may/impact-medicaid-expansionstates-budgets.

15 Alabama Department of Labor, “Alabama’s Labor Force Participation Rate Increases to 57.6%”, Press Release, November 15, 2024, https://adol.alabama.gov/2024/11/alabamas-labor-force-participation-rate-increases-to-57-6/#:~:text= MONTGOMERY%20%E2%80%93%20Alabama%20Department%20of%20Labor,of%20a%20percentage %20to%2057 6%25

16 Alabama Policy Institute, “2023 Medicaid Expansion Report”, March 2023, https://alabamapolicy.org/wp-content/uploads/2023/02/API-2023-Medicaid-Expansion-Report.pdf.

The cumulative federal debt was over $36.1 trillion as of December 6, 2024, more than $100,000 for every Alabamian (17). That number is projected to increase to more than $56.8 trillion by 2034 (18). Federal health care and social security programs are the primary contributors to increased spending and debt.

By expanding Medicaid, Alabama’s state government would become more reliant on an already unsustainable federal budget, once again forcing Alabama taxpayers to fill the gap when federal funding is reduced.

Increased Federal Influence on Alabama Policy Decisions

While proponents of Medicaid expansion would lead the public to think that Alabama is leaving “free money ” on the table, this is not the case. When state governments receive dollars from the federal government there are almost always strings attached.

For example, several states (including Alabama) have attempted to tie work requirements to Medicaid eligibility. The Biden Administration has

17 U.S. Department of Treasury, “What is the national debt?”, https://fiscaldata.treasury.gov/datasets/debt-to-the-penny/debt-to-the-penny., (accessed December 10, 2024)

18 Congressional Budget Office, “The Budget and Economic Outlook: 2024 to 2034”, June 2024, https://www.cbo.gov/publication/60039.

repeatedly denied these requests. When states take more money from the federal government, and Medicaid dollars in particular, they must adapt their policy decisions to federal spending guidelines. The state has less autonomy to tailor programs towards the need of Alabamians, and gives more power to Washington, D.C (19).

A number of states have instituted state healthcare exchanges as an alternative to participating in the current federal healthcare exchange to an Alabama-based health insurance exchange platform [ix]. An Alabama-based health insurance exchange is a marketplace where the state provides the infrastructure, access, and customer support for individuals to purchase commercial health and dental insurance plans. API believes that a shift to a state exchange should be considered due to both cost savings and governance issues. Alabama is paying the federal government more money to run and operate the federal health insurance exchange than it would cost to keep those funds in Alabama to run an Alabama-based health insurance exchange. Cost savings have been estimated at more than $30 million annually due to the retention of Alabama’s user fee.

An Alabama-based health insurance exchange could foster more competitive marketplaces and thereby increase the insured population, giving more people access to medical care. Unlike the current federal exchange, an Alabama-based health insurance exchange would have the autonomy to develop and quickly implement policies specific to Alabama health marketplace needs. In addition, an Alabama-based health insurance exchange could provide revenue stability to healthcare providers and enhance patient continuity of care allowing for enhanced doctor-patient relationships. According to the Kaiser Family Foundation studies [x], uninsured people are less likely than those with insurance to receive preventative care and services for major health conditions and chronic diseases.

Conclusion

While Alabamians can agree that all citizens should have access to high quality healthcare, lawmakers must look beyond how much money state government will get from expanding Medicaid. They must also consider the

19 Alabama Policy Institute, “2023 Medicaid Expansion Report”, March 2023, https://alabamapolicy.org/wp-content/uploads/2023/02/API-2023-Medicaid-Expansion-Report.pdf.

long-term impacts to state budgets, the labor participation rate, impacts on federalism, and the inherent risks of growing more dependent on the federal government.

Requiring Transparency for Federal School Funding

Background

Federal education funding accounts for 17.3% of Alabama’s total K-12 education spending and the federal government has an outsized impact on Alabama’s education policy. Federal rules regulations on K-12 schools have been brought into the spotlight in recent years as a result of controversial rules such as Title IX guidance that forces school districts to allow transgender students to use the bathroom of their preferred gender.

Obama-era laws and guidelines on school lunches were also catapulted into the spotlight, radically altering the requirements for what food K-12 schools are allowed to serve to students.

The complexity of rules and regulations tied to federal school aid funding is compounded by a lack of transparency, where many states do not clearly disclose the requirements or guidelines to citizens and taxpayers. To improve transparency in education, the Alabama legislature should adopt a law requiring disclosure of federal rules and regulations tied to federal school aid funding.

Current Law

In the furtherance of educational transparency, Governor Kay Ivey signed ‘Right to Know’ legislation into law in March of 2024. The legislation, a part of the 2024 BluePrint for Alabama, was a welcome step in the right

direction, mandating that public school teachers post their curriculum online within 30 days of the first day of classes. Senate Bill 48 went into effect at the start of the fall semester of 2024 and puts Alabama in line with a growing number of states that have enacted similar laws, such as Arizona, Michigan, and Texas.

Senate Bill 48 states that “At the beginning of each school year, and no later than 30 calendar days after a new or revised curriculum is adopted, the local superintendent of education and local board of education shall verify that each school under the jurisdiction of the board has posted current adopted curricula for each class on the website of the school. Access to the online curricula shall be made available to students, parents, or guardians of enrolled students through the school website.’

Additionally, the state of Alabama currently publishes a public manual of School Safety and Discipline requirements that local school boards are required to comply with. The State Department of Education is required to publish a manual on or before August 1st of each year that lays out school safety and discipline requirements as prescribed in the Code of Alabama 16-6B-5 which states “In addition to providing quality instruction in classrooms and fiscal soundness, all local boards of education shall be accountable for compliance with statutes and regulations regarding school safety and discipline. The State Department of Education shall send to all local boards of education and all local superintendents of education, on or before August 1 of each year, a manual containing all acts of the Legislature and all regulations promulgated by the State Board of Education which pertain to school safety and discipline.”

Local school boards have reciprocal reporting requirements under section 16-6B-5 of the Alabama Code which are as follows, “Within thirty (30) days of receipt of this manual, each local board of education shall provide to the State Board of Education a report, in the form prescribed by the State Department of Education, describing its compliance with these acts and regulations.”

While there is a clear precedent with regard to the Alabama Department of Education requiring transparency from school boards and providing some degree of transparency, there is no current law that requires the Alabama Department of Education to disclose federal guidelines and rules tied to federal school aid funding, leaving stakeholders and concerned citizens in the dark as they attempt to navigate the complex web of federal rules and regulations foisted on to public schools.

Under Title 1 of the Elementary and Secondary Education Act, states and LEA’s (local educational agencies) such as school districts must prepare an annual report card that reports how states and school districts have performed on a variety of metrics prescribed by the federal government. The findings of these report cards can affect what federal funding a state or school district receives.

The Congressional Research Service (CRS) publishes a list of federal education laws that are enforced/administered by the Department of Education, but it does not cover the more numerous lists of guidelines that states must follow to receive federal funding.

Reforms in Other States

Tennessee pioneered this concept this year as it unanimously passed legislation requiring the State Department of Education to disclose federal education guidance to lawmakers. The bill “Requires the department of education to submit interpretations and directives from the U.S. department of education regarding the implementation of department rules that provide guidance to this state.” The passage of this bill provides a clear blueprint for states such as Alabama to follow suit, and its bipartisan support is encouraging.

Conclusion

Controversial federal rules and guidelines that affect Alabama’s education system should be subject to scrutiny and rigorous debate by the public, not

shrouded in secrecy. Stakeholders in our education system and concerned citizens such as parents would benefit immensely from this information being publicly in an easily accessible format. In recent years, Alabama has made great strides in education transparency, and this would be an important next step.

1 Education Data, “U S Public Education Spending Statistics” Table 3, July 2024 https://educationdata.org/public-education-spending-statistics

2 Associated Press, “New federal rule bars transgender school bathroom bans, but it likely isn’t the final word”, April 23, 2024, https://apnews com/article/title-ix-transgender-bathroom-bans-645b5564ce227a9efe2c05f883609ae8

3 CBS42, “Alabama’s ‘Parents Right to Know Act’ calls for more transparency in the classroom”, March 28, 2024, https://www.cbs42.com/alabama-news/alabamas-parents-right-to-know-act-calls-for-more-transparenc y-in-the-classroom/

4 See House Bill 2272 and Senate Bill 2106, Tennessee legislature 2024 Regular Session

5 See Senate Bill 48, Alabama Legislature 2024 Regular Session

6 See Section 16-6B-5, Code of Alabama

7 See Title I, Part A (Title I), The Elementary and Secondary Education Act

8 Congressional Research Service, “A Summary of Federal Education Laws Administered by the U.S. Department of Education”, November 28, 2022, https://crsreports congress gov/product/pdf/IF/IF10551

Protect Health Freedom of Alabamians

Background

Health freedom can be defined as the power to decide and choose the best course of treatment and general approach to health for an individual and their dependents, without government mandates (1).

While this ability may seem obvious, the onset of the COVID-19 pandemic in early 2020 challenged the concept of health freedom to its core. Travel and quarantine restrictions were put into place for many Americans, with stronger restrictions mandated for individuals who had contracted the virus. With the development of COIVD vaccines over the subsequent months, further restrictions were put into place. Many countries, including the U.S., required travelers entering their borders to be fully vaccinated. Some U.S. states and cities followed a similar course (2).

This was not where COVID related mandates stopped. In September 2021, the Biden Administration released a Path Out of the Pandemic COVID-19 Action Plan. Among its requirements was that the federal Occupation Safety and Health Administration (OSHA) require businesses with more than one hundred employees to mandate COVID vaccinations and require workers remaining unvaccinated to undergo weekly testing. A similar mandate was put into place for all federal government employees and contractors. All these mandates were subsequently declared illegal by federal courts or rescinded by the administration, with the exception of

1 All Sides, “Health Freedom,” https://www allsides com/translator/health-freedom, (accessed December 26, 2023).

2 U.S. Department of Homeland Security, “Frequently Asked Question: Guidance for Travelers to Enter the U S ” , Updated April 21, 2022, https://www.dhs.gov/news/2021/10/29/frequently-asked-questions-guidance-travelers-enter-us, (accessed December 26, 2023).

vaccine requirements for health care workers employed by providers receiving Medicare of Medicaid reimbursement (3).

Though she championed them previously, Governor Kay Ivey spoke out against COVID-19 mandates by the Biden Administration, with the Governor barring all state executive agencies and employees from being compelled to comply or enforce President Biden’s vaccine mandates (4). However, from March 2020 through early April 2021 Alabamians were mandated to wear masks when in public spaces and within six feet of other people. Some Alabamians continued to require masks to school and work into 2022 (5).

Though COVID-19 related mandates have expired, that does not mean that there could not be another resurgence or a new pandemic in the future. Alabamians should not be compelled by federal, state, or local lawmakers to make decisions about their or their loved one ’ s health that goes against their personal views and interests. Alabama lawmakers should protect citizens’ rights to health freedom.

Current Law

Since 2021, several laws to protect Alabamians from health related mandates have been enacted by the Legislature.

During a 2021 special session, the Legislature enacted Senate Bills 9 and 15. Senate Bill 9 required that employers or contractors to allow employees to claim medical or religious exemptions from the coronavirus vaccine. It also authorized a review by the Alabama Department of Labor before an individual was terminated for refusing to comply with the federal vaccine mandates. The provisions of Senate Bill 9 expired in May 2023 (6).

Senate Bill 15 prohibited a minor from receiving a COVID vaccination without parental consent and barred schools from inquiring about the vaccination status of minors. The law remains in effect (7). Some advocates

3 National Academy for State Health Policy, “Federal Vaccine Mandates and Legal Challenges”, January 4, 2022, https://nashp.org/federal-vaccine-mandates-and-legal-challenges/, (accessed December 26, 2023).

4 See Executive Order No 724, October 25, 2021

5 Husch Blackwell, “Alabama: State-By-State COVID-19 Guidance”, https://www.huschblackwell.com/alabama-state-by-state-covid-19-guidance, (accessed December 26, 2023)

6 See Senate Bill 9, Alabama Legislature 2021 Second Special Session.

7 See Senate Bill 15, Alabama Legislature 2021 Second Special Session.

of the bills criticized them for not doing enough to protect the health freedom of Alabamians.

Alabama Legislative Proposals

House Bill 158, relating to mask mandates, was introduced by Brock Colvin for the 2024 regular session. The bill prohibited any government entity from implementing, ordering, or otherwise imposing a mask mandate to prevent the spread of COVID-19 or any other communicable disease. This includes K-12 public and charter schools. Exceptions to the proposed law were allowed for medical or dental facilities licensed by the Alabama Department of Public Health and state or local detention facilities. The bill received a favorable report from the House Health Committee but was not considered by the full body (8).

House Bill 165, which was introduced by Representative Chip Brown during the 2024 legislative session, would have expanded on the parental consent requirement for COVID-19 vaccinations, expanding that requirement to any vaccination for an unemancipated minor (a person under the age of 19). Specifically, the bill states that “ an unemancipated minor may not give consent to the administration of a vaccination for himself or herself without the written consent of a parent or legal guardian.” Certain exceptions were provided such as the unemancipated minor not being dependent on a parent or legal guardian for support, if they were living apart from their parent or legal guardian, or if they were managing their own affairs9 .

Representative Brown’s bill passed the House by an 81-17 margin and was approved by the Senate Judiciary Committee but failed to be brought to the Senate floor for a final vote. Brown has prefiled a similar bill (House Bill 2) for the 2025 Regular Session.

During the 2023 regular session, State Representative Ernie Yarbrough and eight cosponsors introduced House Bill 324. Referred to as the Alabama Health Freedom Act, the bill would have prohibited employers, most public places and establishments, and occupational licensing boards from discriminating against an individual based on immunization status. Any person discriminated against or otherwise adversely impacted based on vaccination status would have been permitted to seek civil action against

8 See House Bill 158, Alabama Legislature 2024 Regular Session.

9 See House Bill 165, Alabama Legislature, 2024 Regular Session.

the responsible party, with the Alabama Attorney General also authorized to pursue civil penalties (10).

Reforms in Other States

Florida

In 2023, Florida Governor Ron DeSantis signed Senate Bill 252 into law, prohibiting discrimination against individuals based on their health care choices. Provisions include prohibiting businesses, charitable organization, governmental entities, and most education institutions from requiring proof of vaccination or COVID-19 testing, as well as mask mandates. The bill further prohibits government entities and education institutions from enforcing the health policies or guidelines of an international health organization unless authorized by law or executive order (11).

Beyond mandates and restrictions, the Florida law prohibits hospitals from interfering with a patient’s right to choose alternative COVID-19 treatments, such as ivermectin.

Over the course of the COVID-19 pandemic a number of states took action to limit health mandates. Eighteen states (including Alabama) implemented vaccine exemptions legislatively or through executive action. Eleven states (including Alabama) passed laws limiting private business vaccine mandates, while two enacted legislation requiring vaccination. From 2020 to 2022, 26 states to limit public entry mandates. Three states and the District of Columbia enacted legislation requiring proof of vaccination upon entry into their boundaries.

Conclusion

Health freedom should be one of the core rights of not only all Alabamians, but all Americans. Citizens should be able to choose what treatments they and their dependent family members receive without government mandates. No one should be required to receive a vaccine or any other type of treatment that goes against their health or personal wishes. Further, no Alabamian should face discrimination, whether by the state, public

10 See House Bill 324, Alabama Legislature 2023 Regular Session.

11 Jeff Scott, “SB 252: An Act Relating to Protection from Discrimination Based on Health Care Choices”, Florida Medical Association, July 13, 2023, https://www.flmedical.org/florida/Florida Public/News/2023/What physicians need to know about SB 252.aspx, (accessed December 26, 2023).

businesses establishments, etc. for their beliefs. The Alabama Legislature has a duty to protect these rights.

Right to Try 2.0

Background

Medical technologies are constantly evolving, and more treatment options are available to Americans than ever before. These new technologies can positively impact all patients but can be particularly valuable for those who have run out of conventional options and are truly down to their possibilities to preserve life. Specifically, this includes one-off treatments that are made specifically for patients based upon their genetic makeup. The federal bureaucracy, namely the Federal Drug Administration (FDA), has not kept pace with these evolving technologies. By failing to do so, the FDA is preventing patients from having access to the latest medical treatments and sometimes life-saving care1 .

Alabama lawmakers do not have to wait for the FDA to reform itself; it has the power to protect patients’ right to access the latest medical treatments available with Right to Try for Individual Treatments (Right to Try 2.0). Because the U.S. constitution provides protection for individual rights, states have the authority to provide additional and greater protections of those rights, particularly as it relates to the health and safety of citizens2 .

1 RightToTry.org, “Right to Try for Individualized Treatments”, https://righttotry.org/rtt2-0/, (accessed December 5, 2024).

2 Goldwater Institute, “Right to Try for Individualized Treatments (right to Try 2 0): Reform Is Needed Now”, https://www.goldwaterinstitute.org/right-to-try-for-individualized-treatments-right-to-try-2-0/, (accessed December 5, 2024).

To be eligible for Right to Try 2.0, a patient will first have to meet several conditions. First, they must be diagnosed with a life-threatening or severely debilitating illness. In addition to the diagnosis, patients must first consider FDA approved treatment options. To proceed with non-approved treatment, they must have a recommendation for an investigative individualized treatment from their physician and give written informed consent regarding the risks associated with undergoing an investigational treatment. Any treatment must be based on an analysis of the patient’s genetic sequence, chromosomes, DNA, RNA, genes and gen products, or metabolites3 .

Right to Try 2.0 also puts safeguards in place for patients, manufacturers, and care providers.

Right to Try 2.0 treatment must comply with federal laws and regulations related to the protection of human subjects in research. This includes ethical standards for protecting patients, having a third-party Institutional Review Board evaluate proposed research projects to ensure they are administered ethically, and ensuring that the patient understands the experimental nature of the treatment. Drug manufacturers are not required to provide treatment. No doctor is required to make a request for a

3 Ibid.

treatment, nor can a doctor of manufacturer be held liable if a patient chooses to use an investigational drug, biological product, or device4 .

Thus far six states have enacted Right to Try 2.0 legislation, including four in 20245 .

Current Law

Under current federal law, new medical treatments must be approved by the FDA before they can be made commercially available to patients. This happens through the clinical trial process which can often take years and even decades to result in final approval. The current system also requires that one medication be given to a large number of patients, eliminating the ability for individualized treatment.

In 2015, the Alabama Legislature enacted the original Right to Try legislation (as did 40 other states and the federal government). The original Right to Try legislation allows terminally ill patients who have considered all other FDA approved treatment options to use non-approved investigational drugs, biological products, and devices. However, the original Right to Try act still requires that any treatment used by a patient must have successfully completed a Phase 1 clinical trial. In other words, the FDA is still involved in the process6 .

Other States

Goldwater Institute Model Legislation

On the heels of the original Right to Try legislation becoming federal law in May 2018, the Goldwater Institute began drafting model legislation that would ultimately become Right to Try 2.0.

Under the provisions of the Goldwater model an eligible manufacturer may make an individualized investigative treatment, biological product, or device available to a patient (though they are not required to). It is the

5 Brooklyn Roberts, “Patients Win as States Recognize the Right to Try Cutting Edge Treatments”, American Legislative Exchange Council, September 23, 2024, https://alec.org/article/patients-win-as-states-recognize-the-right-to-try-cutting-edge-treatments/#:~:te xt=This%20means%20the%20personalized%20treatments,able%20to%20access%20those%20treatment s, (accessed December 5, 2024) 4 Ibid.

6 Federal Drug Administration, “Right to Try”, January 23,2023, https://www.fda.gov/patients/learn-about-expanded-access-and-other-treatment-options/right-try.

responsibility of the patient to pay the costs of the treatment if the manufacturer requires them to do so.

The bill does not require any insurer to expand coverage or pay for the cost of an individualized treatment, nor does it require any government agency (such as the State Medicaid Agency) to pay for the cost of treatment. Further, it does not require any licensed hospital or medical facility to provide additional services7 .

The Goldwater model legislation further provides that a state licensing board or disciplinary subcommittee cannot take any action against a healthcare provider’s license solely based on their recommendation to a patient regarding access to or treatment with an individualized investigative treatment. The act also waives liability for a manufacturer, or any other person involved in the treatment of a patient for any harm done as a result of using an individualized investigative treatment.

Mississippi

In 2024, the Mississippi Legislature enacted its version of Right to Try 2.0, Senate Bill 2858. Mississippi’s bill largely includes the Goldwater model legislation, though lawmakers did specifically expand treatment options to include “long-lasting injectable antiretroviral drugs for the treatment of patients with HIV8 . ”

Louisiana

During the most recent legislative session, Louisiana lawmakers passed the Hope for Louisiana Patients Law into statute. Like the Mississippi Right to Try 2.0 law, it largely uses the same language contained in the Goldwater Institute’s model legislation9 .

Conclusion

Providing access to life-saving medical treatment should be a top priority for Alabama’s lawmakers during the 2025 Regular Legislative Session. Adopting Right to Try 2.0 will expand both the hope and treatment options for patients across the state, particularly for those with rare and terminal

7 See Goldwater Institute, “The Right to Try for Individualized Treatments Act”, https://www goldwaterinstitute org/wp-content/uploads/2023/08/RTT-2 0-Language pdf

8 See Senate Bill 2858, Mississippi Legislature, 2024 Regular Session.

9 See House Bill 899, Louisiana Legislature, 2024 Regular Session.

diseases. It is an opportunity for Alabama to seize the power delegated to it by the U.S. constitution and improve the lives of Alabamians.

Improve and Simplify Ballot Language Requirements for Constitutional Amendments

Background

The ability to amend federal and state constitutions is a critical role in our representative republic. In Alabama that is perhaps more relevant than anywhere else in the world, where the state constitution has been amended 977 times in the past 125 years.

Despite the fact that Alabama’s Constitution is the longest and most amended in existence, there is a legitimate question of whether Alabamians have a full understanding of what they are voting on when they look at the ballot language for an amendment.

The bottom line is that ballot language is often confusing and filled with legal and technical terms that may be hard to understand for many of the state’s voters. What a yes or no vote means is unclear, leaving some Alabamians to defer voting on an amendment at all, or vote in a way that is contrary to what they think the amendment is doing.

While it is true that ballot measures are accompanied by explanatory statements, those statements do not appear on the ballot that comes before voters. Most voters will never read a ballot statement, relying only on the amendment description that appears on a ballot.

Alabama’s voters have a right to know exactly what they are voting for or against before their vote is cast. The Legislature should pursue reforms that make ballot measure language simple, clearly understood, and unambiguous. Doing so will strengthen our state’s amendment process.

Current Law

Though the Alabama Constitution has been amended more than any other Constitution in the world, there are few specific requirements relating to the ballot language used for amendments to the Alabama Constitution.

Section 17-6-41 of the Code of Alabama states that:

“Whenever a constitutional amendment is submitted to a vote of the qualified electors the substance or subject matter of each proposed amendment shall be so printed that the nature thereof shall be clearly indicated. Following each proposed amendment or other public measure on the ballot shall be printed the word "Yes" and immediately under that shall be printed the word "No." The choice of the electors shall be indicated by a mark made by the elector or under the elector's direction opposite the words expressing the elector's desire1 . ”

In 2014 the Legislature created the Fair Ballot Commission which is governed by section 17-6-81 of the code. The Commission is responsible for approving ballot language for statewide constitutional amendments. Under state law, the ballot statement accompanying an amendment must include the text of the amendment and the question that will appear on the statewide ballot, a summary of and the text of the implementing legislation relating to the ballot measure, the placement of the statewide ballot measure, and “A plain language summary of the statewide ballot measure, which shall include, at a minimum, the legal or constitutional authority for its passage, the effect of the statewide ballot measure if it is passed, including its cost and source of funding, and the effect of the statewide ballot measure if it is defeated2 . ”

While the ballot statement is helpful in explaining the impact of an amendment, only the ballot question appears on the ballot that goes before voters. The ballot statement is posted at the time of notification that an amendment will be voted on in an upcoming election.

Alabama’s Constitution does not provide additional guidance in regard to ballot language. It sets for the process for how amendments to the Constitution can be proposed and approved by the Legislature, the ordering of an election upon the proposed amendment, requirements for public

1 See Section 17-6-41, Code of Alabama.

2 See Section 17-6-81, Code of Alabama.

notice of the election and proposed amendment/proclamation by the governor, and the tabulation and reporting of votes3 .

Opportunities for Reform

Ballot language is an area where few if any states appear to have pursued significant reforms. In general, most states require a summary of the amendment to appear on the ballot and it must be written in “unambiguous language”.

Still, there are several commonsense reforms that could be made to make constitutional amendment ballot language more easily understood.

Require than ballot questions be worded so that a yes vote is for change and a no vote is to maintain current law.

Even when a ballot measure is worded clearly, what a yes or no vote indicates can be counterintuitive. An example of this is when a yes vote means maintaining the status quo and a no vote would result in a change to the Alabama Constitution. In other instances, a voter may not know if a yes or no vote aligns with their intent because the ballot question is worded with multiple negatives4 .

To streamline the process and make clearer the implications of a constitutional amendment vote, the state should require that questions be worked so that a yes vote indicates a vote for changing current law and a no vote indicates a vote for maintaining the status quo. Double negatives should also be barred from being used in ballot language, so that the intent of the amendment is clearer5 .

Require ballot text to include a fiscal note (the projected positive or negative impact to the state or local budget) if the amendment will create savings or costs for the voter to consider prior to deciding to support the amendment.

3 See Section 284, Alabama Constitution.

4 Center for Civic Design, “Ballot questions are hard to understand. Here are 6 ways to fix them”, April 19, 2022, https://civicdesign org/ballot-questions-are-hard-to-understand-here-are-6-ways-to-fix-them/ (accessed December 6, 2024).

5 Ibid.

Require ballot text to explain the change in policy.

While the ballot statement accompanying an amendment may better explain the impacts of a proposed amendment, it does not appear on the ballot used by voters on election day. Instead, ballot questions focus on the legal and administrative mechanisms of implementing a new law, not the practical outcomes6 .

Lawmakers should alter ballot language requirements so that it focuses on how the amendment will change current policy, rather than the legal mechanisms for executing that change.

Pose ballot initiatives as a question.

By definition, constitutional amendments are a yes or no question that is being posed to voters. But often amendment measures are worded as a statement rather than as a question. This format can be confusing to voters because it defies standard grammar, where yes or no can only be used to respond to a question7 .

Conclusion

Constitutional amendments are critical to the function of Alabama’s direct democracy. How a ballot measure is worded can affect whether a voter feels invited to participate in that process or excluded because of complicated language. Alabama lawmakers should take steps to simplify the process of voting for a constitutional amendment by making those amendments easier to understand and clearly stating what the impact of an amendment will be.

6 Ibid.

7 Ibid.

Require Government Entities to Livestream Meetings

Overview of the Issue

Transparency is the cornerstone of good governance at all levels, and providing easy access to meetings and deliberations has never been easier due to the popularization of online meeting platforms such as Zoom, Google Meet, and others. Still, many units of government do not provide online video access to meetings. Local governments meeting via teleconference proliferated during the COVID-19 pandemic but have continued afterwards. For instance, in the state of Michigan, a Michigan Public Policy Survey found that 81% of Michigan local governments held at least some meetings via teleconference or video technology1 .

While various states have enacted laws that give school board members and elected local government officials the option to attend meetings via teleconference, this option has not been universally extended to concerned members of the voting public in most states.

To improve transparency in all units of government such as school boards, city councils, and state regulatory bodies and legislative committees, the Alabama legislature should adopt a law requiring all units of government to provide a streaming or teleconference option to the public.

1 Michigan Public Policy Survey, “Internet presence among Michigan local governments: websites, online services, and experience with virtual meetings” May 2022, https://closup.umich.edu/michigan-public-policy-survey/100/internet-presence-among-michigan-localgovernments-websites-online-services

Current Law

Like many other states, Alabama has its own version of the Open Meetings Act, an act that requires state and local governments to make meetings open to the public, provide sufficient notice prior to the meeting, and allow for periods of public comment during deliberations. Alabama’s Open Meetings Act states that “It is the policy of this state that the deliberative process of governmental bodies shall be open to the public during meetings as defined in Section 36-25A-2(6). Except for executive sessions permitted in Section 36-25A-7(a) or as otherwise expressly provided by other federal or state statutes, all meetings of a governmental body shall be open to the public and no meetings of a governmental body may be held without providing notice”2 .

2 See Title 36, Chapter 25A, Code of Alabama

During the COVID-19 pandemic, Governor Kay Ivey opened the door to allowing teleconference meetings for local units of government for business that was necessary to government. As the COVID-19 pandemic wound down, local units of government and school boards returned to in-person meetings, but many did not continue to provide a Zoom option for citizens looking to provide public comment or listen in to deliberations3 .

Additionally, Alabama’s current Open Meetings Act allows for some members of a governmental body to meet via video conferencing or teleconferencing if the body is comprised of members from two or more counties. Still, current law does not give participatory rights to members of the public and it is not a requirement to have a streaming or teleconferencing option. Requirements for such meetings include that a physical location is still provided and that “If a member is participating in a meeting of a governmental body by electronic means as authorized in this section, the governmental body shall ensure that means of access to the electronic communication is published in the same manner as the notice of the meeting is published pursuant to this chapter. The means of access shall allow members of the public to hear the meeting. A governmental body is not required to allow the public to participate by electronic means to any extent beyond being able to hear the meeting4 . ”

Potential for Reforms

In the furtherance of transparency, the Alabama legislature livestreams its deliberations both for meetings of the whole and various House and Senate committees, setting a precedent for regulatory bodies, local units of government, and school boards to do so. Many local units of government and school boards also continue to provide teleconferencing and video options to concerned citizens despite no law requiring them to do so, showing that expanding access to public deliberations is possible.

3 GovTech, “Alabama Council Members Debate Use of Online City Meetings”, May 20th, 2020, https://www.govtech.com/policy/alabama-council-members-debate-use-of-online-city-meetings.html

4 See Title 36, Chapter 25A, Section 5.1, Code of Alabama

While no state has required a teleconference option for units of government at this time, numerous states have expanded access to teleconference meetings to the public.

In California, members of the public attending a meeting via teleconference must be given the same rights afforded to them under the state’s wider Open Meetings Act. AB 2449, signed in 2022 “allows for meetings to occur via teleconferencing subject to certain requirements, particularly that the legislative body notice each teleconference location of each member that will be participating in the public meeting, that each teleconference location be accessible to the public, that members of the public be allowed to address the legislative body at each teleconference location, that the legislative body post an agenda at each teleconference location, and that at least a quorum of the legislative body participate from locations within the boundaries of the local agency ’ s jurisdiction5 . ”

Across the country and in the state of Alabama, the groundwork to expand access to streaming or teleconferencing options for all units of government has been laid, but Alabama has a unique opportunity to be the first in the nation to require such options and be among the most transparent states in the nation.

Conclusion

In an age where providing transparency to concerned citizens has never been easier, requiring deliberative bodies and units of government to provide teleconferencing or video options is a commonsense solution that will come at minimal cost to local and state governments. As the late and great Supreme Court Justice Louis Brandeis once said, “Sunlight is the best disinfectant”, and this legislation would be a significant step in the right direction with Sunshine Week just a few months away.

5 See Assembly Bill No. 2449, California Legislature 2022

Ethics Reform

Background

Ethics are defined as the moral principles that govern our behavior or the conducting of an activity. For most Alabamians, ethics play an important role in our day-to-day lives, guiding us in the decisions that we make.

Ethics are equally important as they relate to Alabama’s state government. Every four years, Alabamians elect public officials to represent their interest before the state. Beyond elected officials, others are appointed or hired into positions of influence within our system of democracy. They expect those representatives to act in an ethical manner at all times.

Having a system of government ethics in place is important for several reasons.

First, it should ensure that public officials prioritize the interest of all Alabamians over personal gain, creating trust in the government by preventing corruption, upholding the integrity of public services, and guaranteeing fair and impartial decision making.

Next, an ethics framework should promote transparency in government operations, allowing citizens to understand how the decisions that impact them are being made. These standards also hold public officials accountable for their actions and provide a means to punish them when misconduct occurs.

Strong ethics laws can also lead to more efficient government by prioritizing public needs over personal interest, leading to the more effective and efficient use of taxpayer dollars and distributing those dollars without favoritism or bias.

Unfortunately, Alabama has a long history with government corruption. A 2018 study found the state to be the fifth-most corrupt in what it described as illegal corruption and 11th in legal corruption, i.e., conduct that is unethical or appears corrupt but is not illegal. This was actually an improvement from the year before when Alabama was ranked in first place for illegal corruption1 . Three Alabama Governors were convicted of ethics related crimes in the past 35 years as well as former Speaker of the House of Representatives. Other officials have faced similar fates.

The Alabama Legislature has a duty to the people that it serves to ensure that state government is acting in an ethical manner where Alabamians are put before all else. When public officials do not act appropriately, they must face meaningful and serious repercussions, not a slap on the wrist.

In 2025 lawmakers should continue to pursue reforms that will reinforce the State Ethics Law and strengthen citizens’ faith in state government.

1 Chip Browlee, “Report: Through improving, Alabama remains one of the country’s most corrupt states”. Alabama Political Reporter, November 1, 2018, https://www.alreporter.com/2018/11/01/report-though-improving-alabama-remains-one-of-countrys-m ost-corrupt-states/, (accessed December 10, 2024).

Current Law

Alabama’s state ethics law is contained within sections 36-25-1 through 36-25-30 of the Code of Alabama. Enacted more than 40 years ago, the Code of Ethics has been amended at least 25 times in a piecemeal fashion.

Among other provisions, it addresses issues such as conflict of interest for public officials, using one ’ s office for personal gain, the acceptance of gifts and other things of value in return for influencing official action, the filing of statements of economic interest, campaign finance, and other disclosures required of public officials as well as various penalties for violations of the law. The State Ethics Commission is charged with oversite and enforcement of the State Ethics Law.

Current statute requires that the Ethics Commission provide and administer training programs on the law for members of the Legislature, constitutional officers, cabinet officers, executive staff, municipal mayors, council members and commissioners, county commissioners, and lobbyists at least once every four years. It can also offer informal opinions to officials when questions arise2 .

Section 36-25-5 of the ethics law prohibits public officials and employees from using their official position to obtain personal gain for themselves, a family member, or any business with which they are associated, unless specifically authorized by law. This includes but is not limited to using public time, labor, or property for an official’s private or business benefit or requesting the use of public time or property for personal benefit. Further, it is a violation of the ethics law for an individual to offer a public official a thing of value in return for influencing an official action as well as for public officials to solicit a thing of value in return for influencing official action3 .

A “thing of value” is defined as “ any gift, benefit, favor, service, gratuity, tickets or passes to an entertainment, social or sporting event, unsecured loan, reward, promise of future employment, or honoraria or other item of monetary value4 . ”

In addition to these prohibitions, public officials are barred from accepting anything (regardless of value) if the intent is to corruptly influence official

2 See Section 36-25-4 2 Code of Alabama

3 See Section 36-25-5, Code of Alabama.

4 See Section 36-25-1, Code of Alabama.

action. This prohibition extends to family members and businesses of the government official as well.

Section 36-25-13 of the code addresses the so-called “revolving door”, which restricts where a former public official or employee can work for a period of two years after they have left their official position. The goal of the provision is to ensure that former public officials do not improperly use or benefit from their previously held public position. Furthermore, current and past public officials are barred from using or disclosing any confidential information gained through their position in any way that could result in financial gain for themselves, family members, or any other person or business.

The next section of the ethics law addresses who must file annual statements of economic interest. The list includes elected or appointed officials, any public official whose salary is $75,000 or more, candidates for public office, members of boards and commissions with statewide jurisdiction, any official whose primary duty is to invest public funds, any agent who has the ability to make a purchase, financial and accounting directors, grant coordinators, and all supervisors, among others5 .

Section 36-25-18 through 36-25-20 relates to lobbyists and requires that all lobbyists register with the state no later than January 31st of each year or within 10 days of accepting a position that requires them to register as a lobbyist. In addition to registering, lobbyists are also required to file quarterly reports outlining financial transactions with public officials.

Section 36-25-23 bars any elected public official from serving as a lobbyist during their term of office.

The law also sets criminal penalties ranging from a Class A misdemeanor to a Class B felony for those who violate it6 .

2024 Alabama Reform Effort

During the 2024 Regular Legislative Session, Representative Matt Simpson introduced House Bill 227, which would have brought a major overhaul to the state’s current ethics code. His stated goal was to make the code easier to understand and simplify the law so that it would be more narrowly

5 See Section 36-25-14, Code of Alabama.

6 See Section 36-25-27, Code of Alabama.

applied. The current law applies to more than 300,000 state employees, including teachers, police officers and firefighters, and their families7 .

One of the largest revisions was that the bill would have taken criminal enforcement of provisions of the ethics code away from the State Ethics Commission, instead placing that responsibility in the hands of local district attorneys and the state Attorney General. The Ethics Commission would have retained the right to impose civil penalties for some violations of the law such as cases involving conflicts of interest, improperly steering government contracts, and restriction on gifts. Several crimes that currently hold a criminal penalty would have been converted to a civil penalty under the proposal8 .

Changes to the ethics law also included a provision that essentially created a means for the Attorney General and Legislative Council to impeach the Director of the Ethics Commission and other employees. A criticism of this provision was that it would make it difficult for the Ethics Commission to hold lawmakers accountable if those same lawmakers had the power to remove them from their position9 .

A controversial provision of the bill would have allowed a public official to accept a gift if it were offered or provided as the result of a family relationship or friendship, so long as the gift was not intended to substantially influence the recipient’s official activities. However, what constituted a friendship was not defined by the bill, potentially opening the door for public officials to receive gifts of unlimited value from prohibited sources under the guise of them being a friend. Current law takes into consideration whether a friendship started before, and gifts were exchanged before, the person became a public official, whereas the proposed revisions did not. Rep. Simpson argued that the provision only changed the burden of proof, requiring the prosecution to prove that a gift was not the result of a friendship10 .

7 Alexander Willis, “Future of Alabama ethics law reform uncertain after bill dies in committee”, Alabama Daily News, May 9, 2024, https://aldailynews.com/future-of-alabama-ethics-law-reform-uncertain-after-bill-dies-in-committee/, (accessed December 10, 2024).

8 See House Bill 227, Alabama Legislature, 2024 Regular Session

9 Ibid.

10 Ibid.

The bill would have also limited the definition of someone who is “closely associated with a public servant” to a spouse, dependent, or associated business. This could have potentially created several problems. For example, while a public servant may not have been able to accept a gift from a prohibited source, their non-dependent child, parents, siblings, etc. would have been able to under the revisions. It also would have lessened what constitutes a conflict of interest, since it would have only applied to something directly impacting the official, their spouse and dependent children, or their business. Current law includes adult children and their spouses, parents, a public official’s spouse ’ s parents, and siblings and their spouses11 .

In other areas, Representative Simpson’s bill would have strengthened current law by increasing criminal penalties for violations. Under the proposal, the penalty for bribery was increased from a Class C felony to a Class B felony. A new crime of use of public office for pecuniary benefit was also created with penalties ranging from a Class A misdemeanor to a Class B felony. For the crime of using public office for pecuniary benefit, it would have applied if anyone associated with the public official benefited, not just the official themselves or spouses and dependent children12 .

The bill was passed by the House on a 79-9 vote with 15 abstentions but failed to be approved by a Senate committee and move to the floor for final consideration.

While Representative Simpson’s bill was not met without criticism, some provisions would have strengthened the law and provided much needed clarity to the process. Most parties agree that reforms need to happen, and discussions will continue. On the last day of the 2024 regular session a Joint Resolution was adopted by the Legislature which requires the Legislative Services Agency to hire an outside consultant to consider Alabama’s ethics laws. A report outlining findings and recommendations is due to the Legislature by the first day of the 2025 regular session13 .

11 Ibid

12 Ibid.

13 See HJR283, Alabama Legislature, 2024 Regular Session.

Representative Simpson has stated that he plans to reintroduce an ethics reform bill in 202514 .

Conclusion

To have faith in Alabama’s state government, citizens must have faith in their elected and appointed public officials. Any reforms made to the State Ethics Law should strengthen that framework, not weaken it or create additional loopholes for interested parties to exploit. Lawmakers should continue to work towards reforms that will achieve that goal.

14 Alander Rocha, “House representative plans to refile bill overhauling Alabama’s ethics code”, August 14, 2024, https://alabamareflector.com/2024/08/14/house-representative-plans-to-refile-bill-overhauling-alabam as-ethics-code/, (accessed December 10, 2024).

Stop the Expansion of Gambling in Alabama

Background

Legalizing casino-style gambling in the state and establishing a statewide lottery is bad public policy, both fiscally and socially, and it is the wrong solution to address the state’s unsustainable fiscal trajectory. Regardless of who plays the lottery or gambles (and regardless of the outcome), the government receives a portion of every dollar spent on these activities. This creates a perverse incentive for the state, especially when conventional revenue streams are volatile. The state becomes addicted to these funding streams, with politicians desiring for more and more individuals and families to recklessly spend their money gambling. If a lottery is instituted or gambling increased, calls to further increased gambling will become incessant and government expansion will likely follow in its wake (1).

Advocates claim that current illegal gambling can be solved by changing the state constitution to make what is now illegal legal. Enforcement of current law and/or increased fines and penalties for illegal and unconstitutional betting is a better answer to the current levels of lawlessness in Alabama. Curtailing gambling is an honorable endeavor, the expansion of gambling is not. Online gambling on sports or anything else would turn every smartphone in the state into a portable casino. Where there are more opportunities to gamble, higher rates of addiction and negative societal impacts follow (2).

States that have legalized gambling experience higher rates of gambling addiction, crime, corruption, addiction, and mental health disorders. With more opportunities to gamble, the negative impact of gambling increases.

1 John Hill, PhD, “State of Alabama Report on Gambling”, Alabama Policy Institute, December 2023, https://alabamapolicy.org/wp-content/uploads/2023/12/Gambling-Report-12-23.pdf.

2 Ibid.

This is especially true as gambling is normalized for children; early and increased exposure to gambling leads to increases in addiction that can cause emotional damage, strained relationships, and ruined lives (3).

Gambling is a bad bet for Alabama families. Suggesting that it is an issue that is “left up to the voters” is not an appropriate response for a conservative legislator. Any attempts to expand gambling or establish a state-run lottery should be rebuffed.

Current Law

Lotteries and most forms of gambling are banned under Alabama state law.

Section 65 of the Alabama Constitution states that “The legislature shall have no power to authorize lotteries or gift enterprises for any purposes, and shall pass laws to prohibit the sale in this state of lottery or gift enterprise tickets, or tickets in any scheme in the nature of a lottery; and all acts, or parts of acts heretofore passed by the legislature of this state, authorizing a lottery or lotteries, and all acts amendatory thereof, or supplemental thereto, are hereby avoided (4).”

Section 13A-12-20 of the Code of Alabama defines gambling as engaging in activity that “stakes or risks something of value upon the outcome of a contest of chance or a future contingent event not under his control or influence, upon an agreement or understanding that he or someone else will receive something of value in the event of a certain outcome.” Further, it defines a gambling device as “ any device, machine, paraphernalia or equipment that is normally used or usable in the playing phases of any gambling activity, whether that activity consists of gambling between persons or gambling by a person involving the playing of a machine (5).”

Because possessing gambling devices is prohibited by state law, casinos are generally prohibited as well (6).

However, the federal Indian Gaming Regulatory Act of 198 (IGRA) eight established a jurisdictional framework for Indian gaming, eventually

3 Ibid

4 See Section 65, Alabama Constitution.

5 See Section 13A-12-20, Code of Alabama.

6 FindLaw, “Alabama Gambling Laws”, June 20, 2016, https://www.findlaw.com/state/alabama-law/alabama-gambling-laws.html, (accessed December 28, 2023).

allowing the Poarch Band of Creek Indians to open three casino sites in Alabama. Each of the Poarch Band of Creek Indian casinos operate under Class II gaming regulations established by the Act. Class II gaming includes electronic bingo and non-banked card games, i.e., card games between two or more players where the players do not wager against the house. Under the provisions of the IGRA, class II gaming does not require the Poarch Band of Creek Indians to enter into an agreement with the state. Rather, their activities are regulated by the National Indian Gaming Commission (7).

Horse and dog racing are also allowed in certain circumstances under Alabama law. Chapter 11, Section 65 of the Code of Alabama permits Class I municipalities (300,000 residents as of the 1970 Census) to establish racing commissions through referendum. Birmingham is the only Class I municipality in the state and approved the creation of the Birmingham Racing Commission in 1984 (8).

Online sports betting is not allowed under Alabama law, though there is an exception for horse racing9 .

Finally, Alabama law allows pari-mutuel gambling in conjunction with horse and dog racing. Since there are currently no active horse or dog racing tracks in Alabama, pari-mutuel betting is done via televised horse and dog races in other states. Pari-mutuel betting is a system in which all bets for a horse or dog race are pooled together, taxes and fees paid to the racetracks facilitating the gambling are deducted, and all winning bets split a share of the overall wagering pool (10).

Negative Impacts of Gambling and Lotteries

Lottery Revenue is Unreliable

7 American Gaming Association, “Gaming Regulations and Statutory Requirements”, https://www.americangaming.org/wp-content/uploads/2019/07/AGAGamingRegulatoryFactSheet Clas sIIGaming-2.pdf, (accessed December 28, 2023).

8 See Chapter 11 Section 65, Code of Alabama.

9 Nick Beare, “Alabama Sports Betting- 2023 AL Sports Betting Update, Legal Sports Report, November 23, 3023, https://www.legalsportsreport.com/alabama/#:~:text=While%20horse%20racing%20is%20legal,also%2 0allowed%20by%20state%20law , (accessed December 29, 2023)

10 John Williams, “Horse Racing and Pari-Mutual Betting”, Minnesota House of Representatives, October 2002, https://www.house.mn.gov/hrd/pubs/ss/sshorse.pdf, (accessed December 28, 2023).

In 2020, 67 cents of each dollar spent on lottery tickets were given back as prizes, and about four cents were used to cover retailing and administrative expenses. The remainder about twenty-nine cents was then earmarked for the programs the lottery is obligated to fund. Since 2011, the percentage of each dollar devoted to state initiatives has fallen from 34% to 29%, while the percentage of money devoted to prizes has increased from 62% to 67% (11).

Eventually, lottery revenues often taper off and, in many cases, decline quickly.

Lottery Effects on the Poor

While people from every income level gamble, people experiencing poverty are most adversely affected because it is harder for them to afford losses. Unfortunately, they also spend more on lottery tickets on an absolute scale.

According to a 2019 survey of 2,377 individuals by Bankrate.com, households earning less than $30,000 per year spent 13% of their income on lottery tickets, compared with just 1% for households earning $50,000 per year or more. The same lower-income households also spent considerably more of their income on alcohol (11%) and tobacco or e-cigarettes (13%) than wealthier ones (3% and 4%, respectively, for those earning $50,000 or more) (12).

• According to a comprehensive 2022 study by the Howard Center for Investigative Journalism at the University of Maryland, stores selling lottery tickets are disproportionately concentrated in lower-income neighborhoods in most states, and their patrons are typically local to those neighborhoods. The percentage of Black and Hispanic residents was also higher in areas with lottery retailers than those without in many states (13).

• A 2010 Journal of Gambling Studies report found that 61% of Americans in the lowest economic quintile were likely to have played the lottery in the past year versus 42% in the top two quintiles. Those in the lowest quintile also bought tickets more frequently (26.1 times in the last year) than those in the two highest quintiles (9.5 and 10.1 times, respectively) (14).

11 John Hill, PhD, “State of Alabama Report on Gambling”, Alabama Policy Institute, December 2023, https://alabamapolicy.org/wp-content/uploads/2023/12/Gambling-Report-12-23.pdf.

12 Ibid

13 Ibid.

14 Ibid.

Questionable Economic Benefits

When money is spent on gambling, it is not spent on other goods and services in the same community; instead, it moves money around. Examples of this “substitution effect” have been documented in Florida, Mississippi, Nebraska, and New York. In states where casino gambling is a true destination Connecticut, Nevada, New Jersey, and Mississippi significant revenue is collected from visitors outside the local economy, while the social costs associated with visiting return home with them (15).

A 2022 study using U.S. Census Bureau data in casino communities from 2002-2017 found that casinos did little to increase retail sales growth. In fact, during the Great Recession (2007-2008), retail sales in casino communities shrank at a rate two to three times greater than those in non-casino communities. Employment in casino communities also grew slower across the entire study period (16).

Not a “Fix” for State Budgets

Legalized gambling adds little to the bottom line of most states. According to state finance data from the U.S. Census Bureau and casino tax revenue reported by the American Gaming Association, combined tax revenues from non-tribal casinos, lotteries, sports gambling, and stand-alone electronic gambling devices represented only 1.7% of the $2.2 trillion spent by state governments in 2021 (17).

Mississippi’s experience using gambling revenues for its budget is a cautionary tale for Alabama. Twenty years ago, the Mississippi State Legislature used to plan for casinos to provide almost 5% of the revenue for its General Fund; in 2024, they expect only 2.14%. Gambling revenues have also fallen 16% since 2008 (a drop of 39% when adjusted for inflation). The reasons: internal competition from tribal casinos and the allure of newer attractions in Arkansas and Louisiana (18).

18 Ibid. 17 Ibid. 16 Ibid 15 Ibid.

Alabama’s fortunes would be no better: If the state could raise the tax revenue estimated in Gov. Ivey’s 2020 gambling report, it would equal only 1.6% of the state’s $43.2 billion budget for fiscal year 2023.

Some states with sports gambling have also been disappointed with their earnings. According to investigative research by the New York Times, the fourteen states that allowed mobile sports betting in the 2021-2022 fiscal year and followed the tax rate advice of gambling associations collected $150 million less in revenues than the $560 million predicted initially (19).

Gambling Addiction

If additional gambling is legalized, its accessibility would undoubtedly draw people who have not gambled previously. Inevitably, some of these would become problem gamblers. According to the National Council on Problem Gambling:

Problem gambling–or gambling addiction–includes all gambling behavior patterns that compromise, disrupt or damage personal, family, or vocational pursuits. The symptoms include increasing preoccupation with gambling, a need to bet more money more frequently, restlessness or irritability when attempting to stop, “chasing” losses, and loss of control manifested by continuation of the gambling behavior in spite of mounting, serious, negative consequences. In extreme cases, problem gambling can result in financial ruin, legal problems, loss of career and family, or even suicide (20).

Social Costs

For some people, gambling creates difficulties of varying severity and duration that also harm people close to them and the broader community. As with the economic effects of gambling, the social costs of addiction are also hidden, but they are no less tangible.

Productivity and Job Loss

Gambling addicts often impose costs on their employers in the form of an unreliable presence on the job and reduced productivity when present. Unemployment is twice as high among gambling addicts than among gamblers who play socially or recreationally. Problem gamblers are also

19 Ibid.

20 Ibid.

more likely to lose their jobs than those who are not problem gamblers because of absenteeism, poor job performance, moodiness, and irritability (21).

Crime

For about as long as gambling has been legal in the U.S., a link between gambling and crime has been suspected. According to this theory, by legalizing gambling, the state reduces the stigma associated with it, increasing the number of gamblers, which, in turn, increases the number of problem gamblers, some of whom turn to crime to finance their addiction. Links between gambling and crime have been found:

• In general, crime rates are higher among gambling addicts than among non-gamblers and those who are not problem gamblers.

• In 1998, a survey of new Texas inmates found that 16% of males and 13% of females were deemed to have gambling problems. A similar study in 2001 of Texas youths admitted to juvenile facilities found that 12% of the males and 8% of the females had gambling problems.

• A 2002 study of recent arrestees in Las Vegas, Nevada, and Des Moines, Iowa, found that 16% of the Las Vegas sample and 7% of the Des Moines sample met the criteria for problem gambling. For all arrestees combined, 15% of all assaults, 27% of all thefts, and 24% of all drug sales were committed to get money to gamble, pay off gambling debts, or were otherwise related to their gambling problem. Of the 4% of Des Moines and 10% of Las Vegas arrestees with severe gambling problems (n = 203), only 6% (n = 13) had ever received treatment (22).

Mental Costs

The cost of pathological gamblers to society is expressed in more than dollars and cents. The gambler often degenerates from an honest, intelligent person to one who has almost no appreciation for their actions. The likelihood of a gambling addict having a mental disorder is high:

21 Ibid.

22 Ibid.

• According to a 2006 report in the Journal of Affective Disorders, about 25% of gamblers with serious addiction problems manifest manic behavior, and over half report being depressed.

• A systematic review of the literature in 2011 surrounding the prevalence of co-morbid behaviors in persons with gambling problems found that 38% had mood disorders, 37% had some anxiety disorder, and 23% had major depression (23).

Suicide

Sometimes, the effects of problem gambling are so severe that the gambler seriously considers or attempts to take their own life:

• Problem gambling has the highest suicide rate of any addictive disorder, with one in five problem gamblers attempting suicide.

• In clinical populations of individuals seeking treatment for gambling problems, between 22% and 81% reported suicidal ideations, and between 7% and 30% had attempted suicide.

• Compared to the general population, gamblers with serious addiction problems are 3.4 times more likely to attempt suicide (24).

Conclusion

Gambling proponents would lead Alabamians to believe that by not expanding gambling and instituting a lottery, the state is forfeiting a significant amount of money to neighboring states. Whether any meaningful economic gains would be realized from expanding gambling is questionable. The creation of a structure to establish and manage a state lottery will grow state government. Any proceeds to the budgetary coffers will also grow state government. Gambling bills that have recently been under consideration were fraught with corrupting influences and principles adverse to free market principles. Negative societal impacts of the expansion of gambling or creating a state condoned/managed lottery would bring are undeniable. Alabama lawmakers should embrace the principles of free markets and limited government. Alabama lawmakers should further protect the most vulnerable of our citizens from harm. Alabama lawmakers should seek to strengthen and ensure that the state’s anti-gambling laws are

23 Ibid.

24 Ibid.

strengthened and enforced. Alabama lawmakers should not expand gambling.

Abortion Inducing Drugs

Overview

In 2019, the Alabama Legislature passed the Human Life Protection Act, which bans post fertilization abortions in the state under most circumstances. Prior to the law’s enactment abortions were legal in Alabama up to the 20th week of pregnancy. The Human Life Protection Act was initially enjoined by U.S. District Court Judge Myron Thompson; however, on June 24, 2022, the injunction was lifted after the U.S. Supreme Court’s decision in Dobbs v. Jackson Women’s Health Organization (1).

The only exception to the Human Life Protection Act is if carrying out a pregnancy would pose a “serious health risk” to the mother, which must be further confirmed within 180 days of the abortion (2). A violation of the law constitutes a Class A felony, which requires imprisonment for 10 to 99 years and a fine of up to $60,000, while attempting to carry on an abortion is a class C felony. A licensed physician who terminates a pregnancy during the course of a medical emergency is not liable for criminal penalties under Alabama law (3).

The law further states that no woman who has or attempts to have an abortion performed upon her can be held criminally or civilly liable under the provisions of the Human Life protection Act.

While the performance of abortions is banned under Alabama law, other southeastern states such as Georgia, Florida, South Carolina, and North

1 Howard Koplowitz, “Federal judge lifts injunction on Alabama’s 2019 abortion ban after Roe v. Wade Overturned”, AL.com, June 24, 2022, https://www al com/politics/2022/06/federal-judge-lifts-injunction-on-alabamas-2019-abortion-ban-aft er-roe-v-wade-overturned.html#:~:text=Politics-,Federal%20judge%20lifts%20injunction%20on%20Ala bama's%202019%20abortion%20ban%20after,Wade%20overturned&text=Published%3A%20Jun.,%2C %202022%2C%204%3A36%20p m , (accessed (November 9, 2023)

2 See Section 26-23H-4 Code of Alabama.

3 See Section 26-23H-7 Code of Alabama.

Carolina allow abortions to some extent with varying restrictions. There are few restrictions in about half of the states in the U.S. Alabama residents are not prohibited from traveling outside of the state to obtain an abortion.

Where ambiguity arises is with the issue of abortion inducing drugs, typically mifepristone and misoprostol. While these drugs have other medical purposes beyond inducing abortion, that is their primary use. In a memorandum dated December 23, 2022, the U.S. Department of Justice gave approval to the U.S. postal service to ship abortion inducing drugs into states where abortion has been banned, so long as the sender lacks the intent that the recipient of the drugs will use them in an unlawful manner4 .

A 2023 survey found that by the end of that year, about 8,000 women per month were receiving abortion pills by mail in states that restrict abortion or limit the ability to have an abortion through a telehealth provider5 .

Current Law

Under current Alabama law, a resident of another U.S. state who mails an abortion inducing drug to Alabama could face prosecution in an Alabama court under the Human Life Protection Act, however, the burden would be on the state to first intercept the drug shipment and further to prove that the intent of shipping the drug into Alabama was to facilitate an abortion. Attorney General Steve Marshall has said that he “will vigorously enforce Alabama law to protect unborn life (6).”

Where Attorney General Steve Marshall lacks jurisdiction is if abortion pills are mailed to an Alabama resident from a foreign country. India is the world’s largest manufacturer of abortion drugs.

Since the Dobbs v. Jackson decision, the flow of abortion inducing drugs from foreign countries into the U.S. has increased substantially, primarily into states with the most restrictive abortion laws, i.e. the Southeast. In the first six months following the Dobbs decision, it is estimated that 50,000

4 U.S. Department of Justice, “Application of the Comstock Act to the Mailing of Prescription Drugs That Can Be Used for Abortion”, December 23, 2022, https://www.justice.gov/media/1266941/dl?inline=.

5 PBS New, “8,000 women a month got abortion pills despite their states’ bans or restrictions, survey finds”, May 14, 2024, https://www pbs org/newshour/health/8000-women-a-month-got-abortion-pills-despite-their-states-ba ns-or-restrictions-survey-finds, (accessed November 27, 2024).

6 Amy Yurkanin, “Women can be prosecuted for taking abortion pills, says Alabama attorney general”, AL com, January 10, 2023, https://www.al.com/news/2023/01/women-can-be-prosecuted-for-taking-abortion-pills-says-alabama-a ttorney-general.html, (accessed November 9, 2023).

abortion pills were provided to Americans from sources outside of the U.S. Up to 100,000 more were expected to enter the country by the end of 2023 (7).

There are several problems associated with shipping abortion inducing drugs into Alabama from another country. First and foremost, abortion is illegal in Alabama.

Beyond the legality of the practice, there are additional health concerns for the woman who may end up taking the medication. In most cases, no prescription or medical consultation is required to purchase foreign manufactured abortion pills. In states where abortion is legal, the medication would be prescribed and taken under the supervision of a licensed physician. Sometimes, additional follow-up medical procedures are needed to complete the abortion process.

In short, taking these unprescribed pills without medical supervision could lead to serious health consequences for those taking them.

Suggested Reforms for Alabama

During the 2025 legislative session Alabama lawmakers should take steps to further protect the lives of the unborn by blocking the flow of domestic and foreign abortion inducing drugs into the state. Policy reforms that should be considered include:

Provide that no internet, cell phone, and content delivery network service providers operating in Alabama shall accept or forward an HTTP request to an IP address that permits a resident to obtain abortion inducing drugs for delivery to the state.

Prohibit health care providers offering abortion producing drugs from using any information technology capabilities that permits a resident to obtain abortion inducing drugs for delivery to Alabama.

Prohibit software-as-a-service providers to allow their products or services to be used to offer the sale and delivery of abortion inducing drugs to Alabama.

7 Allison McCann, “Inside the Online Market for Overseas Abortion Pills”, New York Times, April 14, 2023, https://www.nytimes.com/interactive/2023/04/13/us/abortion-pill-order-online-mifepristone.html, (accessed November 29, 2023).

Prohibit platform-as-a-service and infrastructure-as-a-service providers from using their technological capabilities to permits a resident to obtain abortion inducing drugs for delivery to Alabama.

Prohibit data centers from hosting any information technology capabilities to be used by a person to offer the sale and delivery of abortion producing drugs to Alabama.

Prohibit payment providers from facilitating the payment for any abortion producing drug to be delivered to an Alabama resident.

Require internet and cell phone service provider to prohibit and remove Domain Name Service (DNS) servers used to accept requests from domain names that sell abortion inducing drugs, specifically Aidaccess.org, Heyjane.co, Plancpills.org, Mychoix.com, Justthepill.com, and Carafem.org.

Require the Alabama Attorney General to monitor and keep an up to date list of internet domain names and IP addresses that provide the delivery of abortion producing drugs to Alabama residents.

Provide the Alabama Attorney General with the authority to bring civil and criminal litigation against any technology provider, individual, etc., who provides prohibited products and services.

An unknown that remains is that with Donald Trump winning the 2024 presidential election, the legality of mailing abortion inducing drugs into states where abortion is generally barred could be revisited8 . Trump had previously said that he would not enact any federal abortion bans, however some anti-abortion advocated believe that the Comstock Act, an anti-obscenity law enacted in 1873, could be used to prohibit the mailing of abortion inducing drugs. Among other provisions, the law prohibited the mailing of anatomy textbooks and boxing photographs and contraceptives9 .

8 Chantelle Lee, “How the Biden Administration Protected Abortion Pill Access-and What Trump Could Do Next”, Time Magazine, November 20, 2024, https://time com/7177933/biden-trump-abortion-pill-mifepristone-access/, (accessed November 27, 2024).

9 Jennifer Shutt, “An 1873 law banned the mailing of boxing photos. Could it block abortion pills too?”, New From the States, April 4, 2024, https://www.newsfromthestates.com/article/1873-law-banned-mailing-boxing-photos-could-it-block-ab ortion-pills-too, (accessed November 27, 2024).

Since the law was never repealed at the federal level, it could potentially be used as an enforcement tool against the mailing of domestic and foreign abortion inducing drugs.

Conclusion

The intent of the Protection of Life Act was to make abortion, with the exception of circumstances where a mother’s health is at substantial risk from pregnancy, illegal in Alabama. Domestic and foreign parties are using information technology to circumvent the act and provide abortion inducing drugs to Alabama residents. It is up to the Alabama Legislature to strengthen and enforce the intent of the law.

Short-Term Lending Reform

Background

Short-term loans are often seen as a way for Alabama citizens to bridge the gap between one paycheck to the next if they find themselves running low on funds to cover their day to day expenses. These types of loans can also be used to cover the cost of unexpected expenses, allowing more time for a person to pay the cost of a bill.

There are several types of short-term loans available to Alabamians, including payday loans and title loans. The major problem with these loans is that there are few regulations governing their use in Alabama. They are not treated like a traditional loan offered by a financial institution, where repayment terms are set by law, and interest rates/annual percentage rates (APR), fees, etc. are capped.

Short-term loans are targeted towards Alabama’s poorest communities, citizens that generally have little savings. They are also primarily used by citizens who have few other lending options, i.e. they would not be able to secure a loan through a traditional financial institution. According to a 2019 report from Alabama Appleseed and Alabama Arise, “Payday loan storefronts are heavily concentrated in neighborhoods with high poverty rates and sizeable communities of color1 . ”

In Alabama, payday loans are capped at no more than $500, with the borrower having a maximum of 31 days to repay the loan. The most common payday loan period is 14 days, “which results in an APR of 456%

1 Alabama Arise and Alabama Appleseed, “Broke: How Payday Lenders Crush Alabama Communities”, 2019, https://www.alabamaappleseed.org/wp-content/uploads/2019/04/Alabama-Appleseed-BROKE-ReportWeb.pdf, (accessed December 9, 2024).

for the most common loan structure2 . ” According to a 2022 report from the Pew Charitable Trusts, the average cost associated with a short-term loan of $500 is $521 with an average APR of 312%. In other words, the cost of a short-term loan is generally more than the amount borrowed3 .

Though data on payday loans is not easily accessible, the Alabama Cooperative Extension Service estimates that 200,000 Alabamians take out pay day loans each year, with 85% of those people taking out multiple loans. The Extension Service further estimates that borrowers pay over $100 million in loan fees per year without decreasing the principal owed4 .

While not as high as payday loans, title loans come with similar costs. For lenders, these represent safe transactions because they are backed by a borrower’s ownership of a vehicle. These types of loans are treated as pawn

3 The Pew Charitable Trusts, “Payday Loans Cost 4 Times More in States With Few Consumer Protection”, Issue Brief, April 5, 2022, https://www.pewtrusts.org/en/research-and-analysis/issue-briefs/2022/04/payday-loans-cost-4-timesmore-in-states-with-few-consumer-protections. 2 Ibid.

4 Dorothy Brandon, “Financial Literacy”, Alabama Cooperative Extension Service, June 7, 2023, https://www.aces.edu/blog/topics/finance-career-urban/financial-literacy/, (accessed December 9, 2023).

transactions in Alabama, meaning that title loan brokers have much flexibility in the terms of a loan. If a payment has not been made within 30 days of the expiration of the original contract, the lender can sell a person ’ s care and retain the profits. APR rates for title loans can be as high as 300% under the state’s Pawn Shop Act5 .

The nature of payday, title, and other short-term loans creates a cycle of debt that is hard for some Alabamians to break. The high costs associated with these types of loans make it difficult if not impossible in some cases to pay them back, leaving some residents in worse financial shape than they were in before they took out the loan and potentially without a means of basic transportation.

Current Law

Payday loans are governed by Section 5-18A-et sec, of the Code of Alabama. Under state law, the maximum amount of a payday loan is $500 with a maximum interest rate of 456.25% on a 14-day loan. The repayment term for a payday loan must be at least 10 days but no more than 31 days with one rollover of the loan allowed. There is no limit on the number of payday loans that a borrower may have at any given time, so long as the total of all loans does not exceed $500. Additional finance charges of up to 17.5% of the amount advanced are permittable under state law, this translates to $17.50 for every $100 borrowed6 .

While there are no criminal penalties for failure to repay a payday loan, lenders can attempt to collect through civil action and the borrower must pay attorney’s fees of the lender which can equal up to 15% of the debt owed7 .

Title loans are governed by Section 5-19A-1 through 5-19A-20 of the Code of Alabama, the Alabama Pawnshop Act.

Under the provisions of the law, a borrower gives the title of their vehicle to a lender as collateral and in return receives a loan based on a percentage of

5 Dev Wakely, “Underregulated auto title loans are a bad deal for Alabamians”, Alabama Arise, January 6, 2022, https://www.alarise.org/resources/underregulated-auto-title-loans-are-a-bad-deal-for-alabamians/, (accessed December 9, 2024).

6 Nick Gallo, “Alabama Payday Loan Laws: The Ultimate Legislative Guide”, Debt Hammer, April 17, 2024, https://debthammer.org/alabama-payday-loan-laws/, (accessed December 12, 2024).

7 Ibid.

the value of the vehicle. Value percentages vary from one lender to another. Once the loan has been made, repayment of the principal as well as interest and fees must be repaid with a certain number of days set by the lender. State law allows lenders to charge an interest rate of up to 25% per month, an APR of 300%, which while lower than the maximum APR of a payday loan is still significantly higher than most other forms of credit8 .

If a borrower defaults on the title loan, the lender has the right to repossess the vehicle with no mandatory grace period before the repossession can take place.

Reform in Other States

North Carolina

North Carolina enacted the Consumer Finance Act in 2001. As part of the act, payday loans were prohibited entirely, causing most companies involved in the practice to cease operation. In addition to specifically banning payday loans, the state also put a 36% APR cap in place for all small/short-term loans. Additional fees charged are calculated as part of the APR9 .

Arkansas

In 2010 Arkansas voters ratified a constitutional amendment capping the maximum APR for short-term loans at 17% ($2,000 max over two years). Despite the constitutional amendment, lenders continued to charge significant lending fees, resulting in APRs of up to 280% in some cases. To close the fee loophole, the Legislature passed Senate Bill 658 in 2017, which required that any additional fees be incorporated into the calculation of the overall APR10 .

In addition to these specific reforms, 12 states cap interest rates at 36% while an additional six states and the District of Columbia have lower statutory interest rate caps. In total, at least 21 states have enacted reforms relating to short-term loans11 .

8 Christ Hamilton, “Alabama Laws on Title Loans”, Sapling, https://www sapling com/6820766/alabama-laws-title-loans, (accessed December 9, 2024)

9 See North Carolina General Statutes Section 53-173.

10 See Senate Bill 658, Arkansas Legislature, 2017 Regular Session.

11 Jake Hill, “States Where Payday Loans are Illegal in 2023”, Debt Hammer, https://debthammer.org/states-where-payday-loans-are-illegal/#:~:text=Payday%20lending%20is%20il legal%20in,even%20tighter%20interest%20rate%20caps, (accessed December 9, 2024).

Potential Reforms in Alabama

There are a number of reforms that Alabama lawmakers could consider to provide greater consumer protection for citizens utilizing short-term loans.

First, the state could cap the interest rate on all consumer loans. The Alabama Small Loan Act caps interest rates on traditional short-term loans at an APR of 36%. Capping payday and title loan interest rates at a similar amount would bring uniformity to the lending process and protect consumers from unpredictable and exorbitant interest fees12 .

Another option is to reduce the minimum repayment period from 10 days to 30 days. Doing so would reduce the maximum APR on payday loans by more than half.

Lawmakers should also pursue reforms than increase the accountability of short-term lenders. One option would be to require lenders to secure financial records before a transaction takes place so that they can ensure a borrower’s ability to repay the loan before making it, reducing the risk of default13 .

In terms of title loans specifically, lawmakers should consider several reforms including providing a grace period between the time of default and the time of repossession of a vehicle. Another option is to repay borrowers any amount received from the sale of a repossessed vehicle that goes above and beyond the amount borrowed plus any fees and interest owed on the vehicle. A similar law was passed in 2024 that allows homeowners to claim excess equity in a home that has been seized due to tax foreclosure proceedings14 .

Conclusion

Short-term loans prey on Alabama’s poorest citizens, charging often insurmountable interest rates and putting citizens into a continuing cycle of debt. Alabama lawmakers have a duty to bring more accountability and

12 Dev Wakely, “Underregulated auto title loans are a bad deal for Alabamians”, Alabama Arise, January 6, 2022, https://www.alarise.org/resources/underregulated-auto-title-loans-are-a-bad-deal-for-alabamians/, (accessed December 9, 2024)

13 Ibid.

14 Dev Wakeley, “Underregulated auto title loans are a bad deal for Alabamians”, January 6, 2022, https://www.alarise.org/resources/underregulated-auto-title-loans-are-a-bad-deal-for-alabamians/, (accessed December 9, 2022).

transparency to the process and must ensure that if short-term loans are permitted in the state, they are held to the same standards and requirements as traditional loans.

Pregnancy Resource Center Tax Credits

Background

As a result of the Dobbs v. Jackson Women’s Health Organization decision, combined with the preemptive actions of the Alabama Legislature and the people of the state regarding the prohibition of abortion, abortion became effectively illegal in Alabama in the summer of 20221 .

There is no dispute that many lives have been saved and there is also no dispute that many women in Alabama who might have sought abortions are in need of additional assistance for themselves and their growing families.

Alabama’s pregnancy resource centers and maternity homes provide the necessities that mothers and babies need; their needs are growing as the number in the constituency grows. The 50+ facilities in the state that provide services to expectant mothers rely upon charitable contributions; they all refuse federal and state funding and intervention.

API believes that being against abortion includes being for mothers and their children.

Supporting tax credits for the purpose of supporting the centers that are meeting mothers and babies where their needs are helps fulfill both the spirit of the pro-life movement and the intentional promotion of and support of the family.

Reforms in Other States

Missouri

1 See Case No 19-1392, United States Supreme Court, October Term 2021, June 24, 2022.

Missouri has had a pregnancy resource center income tax credit in place since January of 2007. Initially, taxpayers could claim a non-refundable tax credit of up to 50% of the amount donated to the resource center. In 2021, the credit was increased to 70% of the amount contributed, with a maximum of $50,000 available to any individual taxpayer. While the aggregate amount of tax credits available each year was initially capped between $2.5 million and $3.5 million, beginning in fiscal year 2022 there has not been an aggregate cap in place2 .

Mississippi

During its 2023 regular legislative session, the Mississippi Legislature enacted the Pregnancy Resource Act, which allows up to $10 million in annual tax credits for eligible voluntary donations to pregnancy resource charitable organizations. The credit is only available to business taxpayers and can be used as a credit against income taxes, insurance premium taxes, insurance premium retaliatory taxes, and ad valorem taxes. The Mississippi law also allows for businesses to carry forward the tax credit for up to five years3 .

Louisiana

Louisiana lawmakers approved a similar tax credit for maternal wellness center in 2023. The law provides for a total of $30 million in come tax credits to individuals and businesses from 2025-2030 (a maximum of $5 million per year), with donors able to claim a tax credit equal to the lower of 50% of their contribution to a center or 50% of their total state income tax liability. The act limits the total amount of credits to any individual wellness center to no more than 20% of the total credits available in any given year4 .

Reform Efforts in Alabama

House Bill 356 by Representative Jamie Kiel (R-Russellville), The Pregnancy Resource Act was introduced during the 2024 regular session (a similar bill was introduced in 2023 as well). It would have created an

2 Revised Statutes of Missouri, 135 630

3 Mississippi Department of Revenue, “Credits Available for Contributions to Pregnancy Resource Charitable Organizations”, https://www.dor.ms.gov/credits/PRCO, (accessed December 2, 2024).

4 Julie O’Donoghue, “Tax credit approved for donors to Louisiana anti-abortion centers”, Louisiana Illuminator, July 2023, https://lailluminator.com/2023/07/02/anti-abortion-centers/, (accessed December 2, 2024).

income tax credit of up to 50% of the tax liability for individuals and businesses making voluntary donations to eligible pregnancy and residential maternity facilities. Credits would have been provided from 2025-2029 and capped at an aggregate amount of $10 million per year5 .

According to Kiel, Roe vs. Wade’ s reversal raises expectations of more full-term pregnancies. Thus, the credit would better equip these centers to “help with everything from prenatal care, all the way through the birthing process, help the new moms learn how to cope with motherhood, help with their health care needs, and then sometimes … help with the adoption process6 . ”

Services offered by pregnancy centers and maternity facilities may include parenting classes, pregnancy support and counseling, housing for expectant mothers, life skills training, supplies, and continuing support after the birth of a child.

Alabama currently has approximately 50 pregnancy resource centers and maternity homes across the state, all of which depend on charitable contributions to provide services to expectant mothers. As a result of the Dobbs v. Jackson Women’s Health Organization decision, abortion became effectively illegal in Alabama, meaning that more women may need these facilities than ever before7 .

Conclusion

Supporting tax credits for the purpose of better equipping centers that are meeting mothers and babies where their needs are helps fulfill both the spirit of the pro-life movement and the intentional promotion of and support of the family. Providing these credits to pregnancy resource and maternal medical facilities is one way to ensure that these organizations have the necessary resources to continue to provide care to Alabama’s expectant mothers.

5 See House Bill 356, Alabama Legislature, 2024 Regular Session.

6 Jeff Poor, “State Rep. Kiel hopes to raise $10 million for Alabama pregnancy crisis centers with legislation”, 1819 News, April 23, 2023, https://1819news.com/news/item/state-rep-kiel-hopes-to-raise-10-million-for-alabama-pregnancy-crisis -centers-with-legislation, (accessed December 2, 2024).

7 Alabama Policy Institute, “API Supports Pregnancy Resource Act”, April 5, 2023, https://alabamapolicy.org/2023/04/05/api-supports-pregnancy-resource-act/, (accessed December 2, 2024).

Prohibit Sexually Explicit Performances in Public

Overview of the Issue

Over the past several years there has been a nationwide movement to limit the exposure of minors to inappropriate displays of adult entertainment in public places. While the media has often labeled the issue as a “drag” show ban, most legislative efforts, including in Alabama, have sought to limit exposure to a wide array of adult oriented material.

Parents should have the freedom to decide the types of things that their children are exposed to and at what age they deem certain activities to be appropriate. They should not have to worry about their children being exposed to inappropriate displays of sexual conduct at public libraries, restaurants, parks, etc.

The Legislature should take steps to further protect Alabama’s children from live performance that are of a prurient nature.

Current Law

Crimes related to obscenity are governed by Article Four Title 13A Chapter 12 of the Code of Alabama. Provisions relating to obscene nuisances are found in sections 6-5-160 to 6-5-160.4 of the code.

Section 13A-12-200.5 states that “It shall be unlawful for any person to knowingly or recklessly distribute to a minor, possess with intent to distribute to a minor, or offer or agree to distribute to a minor any material which is harmful to minors. Any person who violates this subsection shall be guilty of a misdemeanor and, upon conviction, shall be punished by a

fine of not more than ten thousand dollars ($10,000) and may also be imprisoned in the county jail for not more than one year1 . ”

Sections 6-5-160 to 6-5-160.4 of the Code of Alabama specifically deal with obscene nuisances. 6-5-160 provides that “the sale and dissemination of obscene material should be regulated without impinging on the First Amendment rights of free speech by erecting barriers to the open display of erotic and lascivious material2 . ” Next, section 6-5-160.1 declares that the use of any premise to distribute obscene materials to minors in violation of Alabama’s Anti-Obscenity Enforcement Act (sections 13A-12-200.1 through 13A-12-200.12) “is a public nuisance and the Attorney General, district attorney, or, when authorized by the local governing body, the attorney for the county or municipality may file an action in the circuit courts of this state to abate, enjoin, and prevent the nuisance. A county, by resolution, or a municipality, by ordinance, may authorize the filing of an action in the circuit court within their jurisdiction to abate, enjoin, and prevent the nuisance3 . ”

House Bill 401 was introduced by State Representative Arnold Monney during the 2023 regular session. The bill would have made several changes to Alabama’s obscenity laws. First, it amended sections 6-5-160 and 6-5-160.1 of the Code of Alabama to provide that the dissemination of “material harmful to minors” should be regulated by the state by erecting barriers to its open display and that premises used to distribute material harmful to minors can be declared a public nuisance. Current law does not include the harmful to minors provision, rather it provides that obscene materials should be restricted and premises distributing obscene materials can be declared a public nuisance4 .

Next, the bill amended the definitions portion of the Alabama Anti-Obscenity Enforcement Act to include under the definition of sexual conduct:

“Any sexual or gender oriented material that exposes minors to persons who are dressed in sexually revealing, exaggerated, or provocative clothing or costumes, or are stripping, or engaged in lewd

1 See Section 13A-12-200.5, Code of Alabama.

2 See Section 6-5-160, Code of Alabama

3 See Section 6-5-160.1, Code of Alabama.

4 See House Bill 401, Alabama Legislature 2023 Regular Session.

or lascivious dancing, presentations, or activities, including but not limited to topless, go-go, or exotic dancers, or male or female impersonators, commonly known as drag queens or drag kings. This sexual conduct is prohibited in K-12 public schools, public libraries, and in other public places where minors are present5 . ”

House Bill 401 was introduced near the end of the 2023 regular session and did not receive committee consideration. However, Representative Mooney introduced a substantially similar bill in 2024, House Bill 385. Over the course of the 2024 session though, the bill was significantly altered, limiting the provisions applicability to only K-12 public schools and libraries6 .

Under the provisions of House Bill 401, citizens were given the ability to provide notice to the principal of a K-12 school, the local school superintendent, or the director or head librarian of a local public library if they believed objectionable material was available to minors at one of those locations. If the notice was deemed valid, then the school/library would have had seven business days to remove the material. If it failed to do so, then school and/or library officials could have been held criminally liable7 .

Ultimately the bill was passed by a vote of 72-28 in the House of Representatives but failed to be considered on the Senate floor before the end of the 2024 legislative session. Representative Mooney has pre-filed a similar bill for the 2025 legislative session (House Bill 4). Reverting to the as introduced 2023 and 2024 versions of the bill would provide much stronger protections for Alabama’s children. Majority Leader Scott Stadthagen has indicated he plans to file a bill in 2025 to protect children from gender indoctrination in schools and also to protect minors at camps and in other spaces.

Reforms in Other States

At least 15 states introduced bills to prohibit drag shows in public spaces during 2023 legislative sessions. These include:

Tennessee

5 Ibid

6 See House Bill 385, Alabama Legislature, 2024 Regular Session.

7 Ibid.

In March 2023, the Tennessee General Assembly enacted the Tennessee Adult Entertainment Act. The law prohibits “adult cabaret performances” from occurring on public property or in a location that could be viewed by children. It defined an adult cabaret performance as an act “that features topless dancers, go-go dancers, exotic dancers, strippers, male or female impersonators who provide entertainment that appeals to a prurient interest, or similar entertainers, regardless of whether or not performed for consideration8 . ”

The Tennessee Adult Entertainment Act faced immediate court challenges with plaintiffs arguing that the legislation was a violation of their First Amendment rights to free speech. In June 2023, a federal court judge ruled that “despite Tennessee’s compelling interest in protecting the psychological and physical wellbeing of children” the Adult Entertainment Act is an unconstitutional restriction of free speech9 .

Kentucky

The Kentucky General Assembly introduced Senate Bill 115 during its 2023 regular legislative session. The provisions of the bill provided that adult-oriented businesses could not operate within 1,000 feet of a child-care facility, children’s amusement establishment, YMCA of YWCA, youth sports facility, public pool, park, place of worship, playground, public library, recreational area, residence, school, or walking trail. The bill also amended state law to include any establishment that hosts drag performances under the definition of an adult-oriented business. A drag performance was defined as “ a performance in which a performer sings, lip syncs, dances, reads, or otherwise performs before an audience for entertainment while exhibiting a gender expression that is inconsistent with the biological sex formally recognized on the performer's original birth certificate using clothing, makeup, or other physical markers, and this gender expression is a caricatured, advertised, or featured aspect of the performance taken as a whole10” .

8 See Senate Bill 3, Tennessee General Assembly 2023 Regular Session

9 Micaela Watts, “Federal judge tosses Tennessee's controversial anti-drag law, declares it unconstitutional”, Memphis Commercial Appeal, June 3, 2023, https://www commercialappeal com/story/news/local/2023/06/03/tennessees-unconstitutional-drag-b an-struck-down-by-federal-judge/70281619007/, (accessed January 4, 2023).

10 See Senate Bill 155, Kentucky General Assembly 2023 Regular Session.

Senate Bill 115 was passed by the Kentucky Senate but failed to receive a committee hearing in the House of Representatives.

Arkansas

In February 2023, the Arkansas Legislature enacted Senate Bill 43, which prohibits “adult-oriented performances” from taking place on public property, admitting minors for attendance, and being funded in whole or party with public funds. An adult-oriented performance is defined as a performance “intended to appeal to the prurient interest and that features” persons in a state of nudity, the purposeful exposure of a specific anatomical areas, or prosthetic genitalia or breasts, or that feature a specific sexual activity11 .

The introduced version of the bill specifically included drag performances under the definition of an adult-oriented business and defined it as a performance in which performers “Exhibits a gender identity that is different from the performer's gender assigned at birth using clothing, makeup, or other accessories that are traditionally worn by members of and are meant to exaggerate the gender identity of the performer's opposite sex ” and sings, lip-synchs, dances, or otherwise performs before an audience of at least two persons12 . The drag provisions were deleted from the House version of the bill.

Florida

The Florida Legislature enacted the Protection of Children Act in May 2023 (Senate Bill 1438). Among other provisions, the legislation bars state and local governmental entities from issuing permits for businesses to conduct performances that would expose children to adult live performances, gives the state the authority to fine and suspend or revoke licenses for public establishments that admit minors to adult performances, allows the state to revoke alcoholic beverage licenses for violating establishments, and imposes fines for violations of the law13 .

The Florida law was temporarily blocked by a U.S. District Court Judge in June 2023 on the grounds that it likely violates the U.S. Constitution’s freedom of speech protections. As of November 2023, the U.S. Supreme

11 See Senate Bill 43, Arkansas Legislature 2023 Regular Session

12 Ibid.

13 See Florida Senate Bill 1438, Florida Legislature 2023 Regular Session.

Court had declined to lift the injunction14 . However, Florida’s appeal to the Supreme Court was based on procedural grounds, not the issue of whether the law violates the First Amendment, which the Court indicated it could be open to hearing further arguments on in the future15 .

In 2024 an estimated 27 bills were introduced to limit the exposure of minors to adult materials in public spaces, though no additional laws were enacted16 .

Conclusion

Under the as introduced 2024 Alabama proposal as well as those from other states, no restrictions would be placed against those over the age of majority attending adult oriented live performances, nor against performers who wish to participate in these activities. It would simply protect minors from unintentional exposure in public and in public schools. Parents should have the freedom to take their children to any public space without the fear of exposing them to age-inappropriate sexual or gender-oriented material or instruction.

14 John Kruzel, “US Supreme Court keeps pause on Florida's ban on drag shows in front of kids”, Reuters, November 16, 2023, https://www.reuters.com/legal/us-supreme-court-keeps-pause-floridas-ban-drag-shows-front-kids-2023 -11-16/, (accessed January 4, 2023).

15 Samantha Neely, “Supreme Court denies Florida’s request to revive anti-drag show bill Here’s how it started with Orlando drag bar”, The Daytona Beach News-Journal, November 17, 2023, https://www.news-journalonline.com/story/news/2023/11/17/supreme-court-florida-anti-drag-law/7161 7125007/, (accessed January 4, 2023)

16 Angela Latham and Thao Nguyen, “Federal appeals court dismisses suit challenging Tennessee drag restrictions law”, USA Today, July 18, 2024, https://www.usatoday.com/story/news/nation/2024/07/18/tennessee-drag-ban-appeals-court-upholds/ 74463031007/, (accessed December 2, 2024).

Allowing Chaplains in Public Schools

Overview of the Issue

A chaplain is a certified member of the clergy that provides spiritual guidance for individuals, generally in a non-religious environment rather than a church organization. They often take on the role of a spiritual leader for people who do not belong to a specific congregational community1 .

Recently, the issue of whether chaplains should be permitted to work in schools has been raised, in part because many school districts are experiencing a severe shortage of counselors and social workers. The idea is that hiring chaplains to serve in public schools could bring a faith-based approach to help alleviate those shortages2 .

Thus far Texas, Florida, and Louisiana are the only states in the nation to enact legislation to specifically allow school districts to hire chaplains. Since the beginning of 2023, at least 30 bills have been introduced in 16 states to allow public school systems to hire chaplains3 .

Is Hiring School Chaplains Legal Under the United States Constitution?

One might assume that if a public school hires a chaplain there could be a violation of the United States Constitution’s First Amendment, which

1 Advent Health University, “Chaplain vs. Pastor: What is the Difference?”, April 7, 2021, https://www.ahu.edu/blog/chaplain-vs-pastor, (accessed December 21, 2023).

2 David Montgomery, “New Texas law allowing chaplains in public schools could be a model for other states”, Stateline, June 21, 2023, https://stateline.org/2023/06/21/new-texas-law-allowing-chaplains-in-public-schools-could-be-a-model -for-other-states/, (accessed December 21, 2023).

3 Naaz Modan, “Bills allowing chaplains in public schools gain steam”, K-12 Dive, August 26, 2024, https://www.k12dive.com/news/school-chaplain-bills-2023-2024-louisiana-texas-florida/725166/, (accessed December 2, 2024).

prohibits Congress (and in turn states) from enacting laws relating to the establishment of religion, or laws prohibiting the free exercise of religion4 .

However, according to the National School Chaplains’ Association (NSCA), any school district in the nation has the legal authority to hire a chaplain. School chaplains (whether part-time or full-time) are subject to the same rules and regulations as all other school employees. School districts are given the discretion to define the role and responsibilities of chaplains. In some cases, this means serving teachers and employees of a school, while in other cases Chaplains may engage with students in common areas, but not in a private one-on-one setting5 .

The NSCA reports that “courts consistently uphold chaplaincy because chaplains represent God, not the church, denomination, or religion. As Godly counselors, chaplains are trusted Biblical advisors, which is why chaplains are paid to serve schools, the military, law enforcement, hospitals, the U.S. Senate, and Congress6 . ”

There is no clear prohibition against chaplains operating in Alabama’s public schools so long as students are not forced to interact with or receive spiritual guidance from them. Other state agencies, notably the Alabama Department of Corrections, already offer chaplain services. Many of the state’s public universities employ chaplains to offer spiritual guidance to student athletes, with those athletes having the freedom to choose whether they participate in religious activities.

What Have Other States Allowed?

Texas Senate Bill 763, enacted during the 2023 regular legislative session, allows, but does not compel, school districts and open-enrollment charter schools to employ or accept volunteer chaplains to “provide support, services, and programs for students.” Before being employed by a school district the chaplain is required to undergo the same background check requirements as other school employees. Any person who has been convicted of a crime that requires sex offender registration is barred from serving as a school chaplain under the Texas law. Senate Bill 763 does not

4 See United States Constitution, First Amendment.

5 National School Counselors Association, “School chaplaincy’s legal precedent”, https://www nationalschoolchaplainassociation org/employingchaplainslegalities, (accessed December 21, 2023).

6 Ibid.

require chaplains that chaplains be licensed by the state to serve at a school7 .

The Florida and Louisiana laws are structured in a similar fashion, including provisions requiring the notification of parents and requiring volunteer chaplains to meet background screening requirements.

What Benefits Do School Chaplains Provide?

Alabama could realize a number of potential benefits from hiring chaplains to work in public schools.

The first benefit is increasing school safety. Because chaplains operate in an informal guidance capacity, there is less stigma in a student speaking with a chaplain than other school officials, who may be forced to elevate issues up the administrative chain of command and could negatively impact a student's school record. Chaplains certified by the NSCA are trained to recognize school safety threats and intervene before they escalate to potentially tragic levels8 .

Another potential benefit of employing school chaplains is improving the mental health of both school employees and students. While school chaplains are not trained mental health experts, they serve as a “nonjudgemental confidant” that employees and students can talk to without the fear of any repercussions. They can also refer someone to a licensed mental health professional when an individual needs more intensive therapy9 .

Finally, school chaplains have been shown to improve teacher retention, which could help alleviate the teacher shortages that Alabama and many other states are experiencing. Because school chaplains are seen as peers amongst school employees, they can serve as an impartial listener who can become an ally and confidant of other employees and help them through challenging work and personal situations10 . 2024 Regular Session Bills

7 See Senate Bill 763, Texas Legislature 2023 Regular Session.

8 National School Chaplains Association, “School Benefits”, https://www nationalschoolchaplainassociation org/school-benefits, (accessed December 21, 2023)

9 Ibid.

10 Ibid.

During Alabama’s 2024 Regular Legislative Session, two bills were introduced to allow chaplains in K-12 public schools, Senate Bill 294 by Rodger Smitherman and House Bill 316 by Mark Gidley. While Rep. Gidley’s bill was approved by the House Committee on Education Policy, Senator Smitherman’s bill passed the Senate unanimously and was approved by a House Committee but failed to receive final passage by the full House before the end of the session. The bills would have required volunteer chaplains to undergo a criminal history background check and would have prohibited registered sex offenders from working as a volunteer chaplain in a public school11 .

Conclusion

Explicitly allowing chaplains to work in Alabama’s schools could be beneficial to employees and students alike. So long as chaplaincy services are optional, they should not run afoul of the United States Constitution. School chaplains can provide a positive guiding presence within school communities. Lawmakers should statutorily ensure the freedom of school districts to employ them or let them volunteer if they so choose to do so.

11 See Senate Bill 294, Alabama Legislature, 2024 Regular Session.

Disallow Gender Indoctrination in Public Schools

Background

There has been a huge increase in societal confusion regarding the definition of men, women, girls, and boys. We agree that the sexes are legally equal but possess unique and immutable biological differences that manifest prior to birth and increase as they age and experience puberty; Further, the State of Alabama has a compelling interest to support the rights of parents to protect the innocence of their children and prevent unjust discrimination, advancing equal opportunity, and maintaining safety, privacy, and fairness;

“In at least 6,000 public schools across the country, children are being encouraged to inch toward fateful decisions with lifelong impact, all without their parent’s knowledge or consent…The U.S. saw a nearly five-fold increase in gender transition surgeries for teens from 2016 to 2019 alone. And a new report indicates that approximately 300,000 adolescents between the ages of 13 and 17 now identify as transgender.” 1

The US Department of Education promotes wholesale affirmation of gender confusion and pending Title IX changes add gender to current law regarding sex. 2

The National Education Association, parent organization of the Alabama Education Association (AEA) also actively promotes “gender affirmation” calling their program “Defending the Freedom of our LGBTQ+ Students to

1 https://www.heritage.org/gender/commentary/parents-are-fed-public-schools-secretly-transitioning-chi ldren

2 https://www.ed.gov/media/document/ed-factsheet-transgender-202106pdf

be Themselves” and advocating the promotion of gender ideology on social media sites.3

The Prohibiting Parental Secrecy Policies in Schools Act, sponsored by Rep. Doug LaMalfa (R-CA), would withhold federal funding from schools that fail to require parental permission before a student can change their name or pronouns at school. 4

Conversely, a federal judge recently opined: “Teaching a child how to determine one ’ s gender identity” strikes “at the heart of parental decision making in a matter of greatest importance in their relationship with their children.5

Though there appears to be societal disagreement amongst teachers and teachers’ unions about the role of parents in their minor children’s lives, Americans are united about what should and shouldn’t be taught in schools. A recent poll by Scott Rasmussen showed that sixty-eight percent (68%) think lessons about exploring or changing gender identity should not be taught in public schools, just 19% think they should be taught in schools.

Reforms in Other States

Florida passed the Parental Rights in Education Act and Governor Ron DeSantis signed the bill into law on March 28, 2022. The law prohibited classroom instruction on sexual orientation or gender identity from kindergarten to grade 3 in Florida public school districts, or instruction on sexual orientation or gender identity in a manner that is not "age appropriate or developmentally appropriate for students" in any grade. The bill additionally prevents school districts from withholding information about a child's "mental, emotional, or physical well-being" from their parents. The Act was amended in 2023. “The law stipulates that it must be the policy of every public K-12 school “that a person ’ s sex is an immutable biological trait and that it is false to ascribe to a person a pronoun that does not correspond to such person ’ s sex. ” It also states that no employee or

3 https://www.nea.org/advocating-for-change/racial-social-justice/tools-justice/lgbtq-support-protection

4 https://www.heritage.org/gender/commentary/parents-are-fed-public-schools-secretly-transitioning-chi ldren

5 https://www.heritage.org/gender/commentary/wisconsin-public-schools-gender-policies-shut-out-paren ts-violate-their-rights

contractor with a public school can be required to use a person ’ s preferred pronouns if the pronouns do not correspond to the person ’ s sex.6

Indiana Governor Eric Holcomb signed a bill in May of 2023 that requires schools to notify parents if their child requests a name or pronoun change. House Bill 1608 states that schools must notify at least one parent in writing within five days of the student’s request. 7

Reforms in Alabama

In Alabama, Majority Leader Scott Stadthagen sponsored a 2022 law that prohibited the discussion of gender oriented material in grades K-5. 8 Representative Mack Butler carried a similar bill in 2023 to expand that prohibition through the 8th grade and though it passed the Senate, it didn’t pass in the House.9 In addition, a bill that would have barred K-12 teachers from displaying flags or other insignia related to gender identification failed on the last day of the legislative session in 2024. 10

Conclusion

Alabama should expand the ban on lessons regarding sexual orientation and ensure that teachers and students are protected from mandates regarding teaching and learning gender ideology to minors. Lawmakers and parents must to fight back against gender indoctrination policies in their children’s schools, oppose state laws that allow those policies and speak out against federal rule changes that promote a confusing and divisive agenda at their children’s expense.

8 https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2022RS/PrintFiles/HB322-Enr.pd f; 7 https://www.standingforfreedom.com/2023/05/several-states-say-no-to-schools-pushing-radical-gender -ideology/ 6 https://www.standingforfreedom.com/2023/05/several-states-say-no-to-schools-pushing-radical-gender -ideology/

9 https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2023RS/HB354-int.pdf

10 https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2024RS/HB130-eng.pdf

Promote History and Civics Education

Background

To be well rounded citizens, Alabama students must first understand their rights and responsibilities under both the federal democratic system of government as well as state government. A key component of building that foundation is through a civics education program. Having a strong comprehension of civics not only helps to build engagement throughout a student's life, but also helps to strengthen democracy and develop critical thinking skills, among other positive outcomes.

Over the past decade, numerous states have taken steps to improve civics education courses for K-12 public school students. Alabama, among others, has implemented a civics component to receive a high school diploma. Other states have gone a step further by implementing additional (optional) certifications for public school teachers so that they are better equipped to teach these lessons to students, enabling them to better prepare America’s children for the duties and obligations that go along with being an American citizen.

In conjunction with civics education, states have also implemented requirements that students learn more about the history and meaning behind America’s national anthem, The Star Spangled Banner. 47 states require that the Pledge of Allegiance be offered at the beginning of each school day, with some providing the option to substitute the playing of The Star Spangled Banner instead. Other states require that the Star Spangled Banner specifically be played in school at least once per week and/or at all patriotic events.

American exceptionalism is something that all citizens should take pride in. It is particularly important for America and Alabama’s youngest citizens to develop a deeper knowledge and understanding of our nation’s history and what makes it the greatest country in the world.

Current Law

Under Section 16-43-5 of the Code of Alabama, all public K-12 schools are required to conduct the pledge of allegiance at the beginning of each school day. Students are given the opportunity to recite the pledge if they choose to do so but are not required to and cannot be punished in any way for refusing to do so1 .

Prior to the 2019 Regular Legislative Session, the requirement for the pledge to be recited each day was not in place. At that time, state law stated that the State Board of Education “shall afford all students attending public kindergarten, primary, and secondary schools the opportunity each day to voluntarily recite the pledge of allegiance to the United States flag.” House Bill 339 by Representative Nathaniel Ledbetter amended the statute to make the reciting of the pledge of allegiance mandatory2 .

During the 2017 Regular Legislative Session, the Alabama Legislature also took steps to improve civics education in the state. Senate Bill 32 by Arthur Orr implemented a civics test as part of the states required course in government. Students must answer at least 60 of 100 questions correctly in order to graduate from high school, though a chief school administrator can waive the requirement for any student for good cause. The test is comprised of the same questions used by officers of the United States Citizenship and Immigration Services as the basis for selecting questions posed to applications for United States naturalization3 .

Reform in Other States

Iowa

During its 2024 regular session, the Iowa Legislature introduced House Bill 587 relating to the national anthem. The bill altered state law to require that the state’s social studies and history curriculums shall include

1 See Section 16-43-5, Code of Alabama

2 See House Bill 339, Alabama Legislature, 2019 Regular Session.

3 See Senate Bill 32, Alabama Legislature, 2017 Regular Session.

instruction related to the words and music of the national anthem, the meaning and history of the national anthem, the objects and principles of the United States, the sacrifices made by the nation’s founders, the contributions made by all who have served in the armed forces since the county’s founding, and how to love, honor, and respect the national anthem.4

Beyond the educational component, the bill also required that all teachers and students must stand and sing at least one verse of the national anthem each day, with the entire anthem to be sung on patriotic occasions. The bill did provide exceptions for teachers and students who did not wish to participate in the singing of the national anthem5 .

Indiana

Current Indiana law requires that The Star Spangled Banner be sung in its entirety at public K-12 schools on all patriotic occasions6 .

Florida

In 2019, Florida Governor Ron Desantis implemented a new civic literacy requirement for all high school students. The program requires that students must have at least one credit in United States History and one-half credit in United States Government to earn their diploma. Students are also required to take an assessment of civic literacy, and if they pass the exam, they are exempt from the postsecondary literacy assessment required by state law7 .

In addition to the civics literacy requirement, Florida also implemented a Civics Seal of Excellence for teachers, which consists of an approximately 50 hours course focused on history, government, and political science taken over the period of two months. Teachers obtaining the Civics Seal of Excellence are eligible for a one-time stipend of $3,0008 . Illinois

4 See House Bill 587, Iowa Legislature, 2024 Regular Session

5 Ibid.

6 See section 20-30-3-3, Indiana Code.

7 Florida Department of Education, “Civics Literacy Excellence Initiative”, https://www.fldoe.org/academics/standards/subject-areas/social-studies/civics-lei.stml.

8 Ibid.

Nearly a decade ago, Illinois enacted legislation requiring all high school students to have one semester of civics education in order to obtain their high school diploma. The stated goal of the legislation is to help students acquire and learn to use the skills, knowledge, and attitudes that will prepare them to be competent and responsible citizens throughout their lives. Content focuses on government institutions, the discussion of current and controversial issues, service learning, and simulations of the democratic process9 .

Alabama Proposals

Each regular legislative session since 2020, Senator Gerald Allen has introduced constitutional amendment legislation relating to the playing of The Star-Spangled Banner at public K-12 schools. Senate Bill 13, which has been prefiled for the 2025 regular session, would require The Star-Spangled Banner to be broadcast at least one time each week during school hours at each public K-12 school in Alabama. Alternatively, the first stanza of The Star Spangled Banner may be performed at least once a week by a school-sanctioned band, chorus, vocal group, or vocalist. The Legislative findings section of the proposed amendment states that “it is imperative that students have exposure to this history and inspiration”10 .

While several of Senator Allen’s anthem bills have been approved at the committee level, they did not advance to the Seante floor for a final vote.

Representative Mark Gidley plans to file a bill in 2025 regarding the type of treatment that the teaching of communism and socialism receive in public school. Representative Gidly also plans to file a bill that the Ten Commandments be rightfully displayed in public locations, including public schools.

In addition to Senator Allen’s bill requiring that the national anthem be broadcast at each public school at least once per week, he has also prefiled a bill (Senate Bill 8) to establish the American History and Civics Excellence Initiative within the State Department of Education. Essentially this would be a new certification available to high school teachers across the state11 .

9 See House Bill 4025, Illinois General Assembly, 99th Session, 2015

10 See Senate Bill 13, Alabama Legislature, 2025 Regular Session.

11 See Senate Bill 8, Alabama Legislature, 2025 Regular Session.

Under the provisions of bill, the American History and Civics Excellence Initiative would consist of an online certification course that requires a minimum of 50 hours to complete. The bill specifies that the course of study will include topics such as the philosophical underpinnings of the American Republic and the root of American exceptionalism, the success of the United States as well as the success and failure of other nations’ governing philosophies to evaluate their past, present, and future, effects, the value of civic pride and regular participation in government, and the rights and responsibilities of citizens12 .

Once the course is completed, a teacher would be eligible to receive the American History and Civics Seal of Excellence Endorsement, which if granted would include a one-time stipend of $3,000 payable to the teacher13 .

Conclusion

Developing a strong understanding of civics and our nation’s history will better prepare Alabama’s K-12 students for the duties and obligations that go along with living in the world’s greatest democratic republic. Alabama lawmakers should continue to take steps to improve that education and help develop more well-rounded citizens.

12 Ibid.

13 Ibid.

Increasing the Age of Majority to Consent to Medical Treatment

Background

Most Alabamians would agree that parents should have the right to have a legal say in the medical care received by their children. However, in Alabama this is often not the case. With exceptions, any child aged fourteen or older can legally make their own medical decisions. That age is the lowest in the country.

The medical field can be a complicated and confusing landscape for adults, let alone children. Without requiring parental consent, Alabama’s children face a potential risk of receiving unnecessary, dangerous, and costly healthcare treatments that they may not need. Moreover, they may not be able to understand the long-term consequences of those decisions nor be able to comprehend the implications.

The Alabama Legislature should take steps to empower parents to better protect their children from unnecessary and potentially dangerous medical procedures. Raising the age of majority for medical decisions will help ensure that right.

Current Law

In regard to medical services, Section 22-8-4 of the Code of Alabama states that “ any minor who is 14 years of age or older, or has graduated from high school, or is married, or having been married is divorced or is pregnant may give effective consent to any legally authorized medical, dental, health or

mental health services for himself or herself, and the consent of no other person shall be necessary (1).”

Next, Section 22-8-6 gives minors 14 years of age or older the ability to consent to “ any legally authorized medical, health or mental health services to determine the presence of, or to treat, pregnancy, venereal disease, drug dependency, alcohol toxicity or any reportable disease”, without the permission of a parent or guardian (2).

In 2021, the Alabama Legislature enacted Senate Bill 15 (2nd Special Session), which provides that a minor (i.e., child under the age of 19) must obtain consent from a parent or legal guardian to receive a COVID-19 vaccination. The law also bars institutions of education from inquiring into the vaccination of a minor without written parental consent (3).

During the 2022 regular session, Alabama lawmakers enacted the Alabama Vulnerable Children Compassion and Protection Act (VCAP), which prohibits the performance of any medical procedure or the prescription of medicine to a minor if it is intended to alter the minor’s gender or to delay the onset of puberty. Violations of the Act are a felony, punishable by up to ten years in prison4 . VCAP was passed in response to an increase in gender altering procedures being performed on minors nationwide, as well as an increase in the prescription of hormone suppressing drugs in relationship to gender non-conformity. For the purposes of VCAP, a minor is defined as anyone under the age of nineteen (5).

Enforcement of the VCAP law is currently in federal court and awaits a decision from the 11th United State Circuit Court of Appeals (6).

For most non-medical matters, Alabama’s age of majority is nineteen, at which point they “shall be relieved of his or her disabilities of minority and thereafter shall have the same legal rights and abilities as persons over 21 years of age7 . ” Exceptions to the law include entering contracts for college

1 See Section 22-8-4, Code of Alabama.

2 See Section 22-8-6, Code of Alabama.

3 See Senate Bill 15, Alabama Legislature 2021 Second Special Session.

4 See Senate Bill 184, Alabama Legislature 2022 Regular Session.

5 See Section 43-8-1, Code of Alabama

6 The Associated Press, “Lawsuit challenging Alabama's trans care ban for minors will move forward, judge says ” , December 27, 2023, https://www nbcnews com/nbc-out/out-news/lawsuit-challenging-alabamas-trans-care-ban-minors-will -move-forward-j-rcna131293, (accessed December 28, 2023).

7 See Section 26-1-1, Code of Alabama.

loans and allowing members of any branch of the Armed Forces of the United States to contract with a banking institution to obtain a loan or open a checking or savings account (8).

Alabama Legislative Proposals

During the 2023 Regular Legislative Session, Senator April Weaver introduced Senate Bill 226, which would have increased the age of majority in Alabama for medical, dental, and mental health services. Presumably, the bill would have moved the age of majority to nineteen, which is current law for most non-medical decisions unless a minor has been emancipated by a state court. Under the provisions of Senate Bill 226, unless a minor is married or has been married and divorced, parental consent would have been required for most services. Exceptions were provided for legally authorized services to determine if a minor is pregnant, as well as for services to determine, and if necessary, treat sexually transmitted diseases, drug dependency, and alcohol toxicity or any reportable disease (9). The bill did not progress beyond the introduction stage in 2023.

In 2024, Representative Ben Harrison introduced a similar bill, House Bill 246, which would have raised the age of medical majority from 14 years to 18 years. Any unemancipated child under the age of 18 would have been required to receive written parental consent to receive medical treatment or mental health treatment for pregnancy, venereal disease, drug dependency, alcohol toxicity, or any reportable disease. The bill was not considered by the House Health Committee10 .

In October 2024, Representative Susan Dubose indicated that she intends to file similar legislation again during the 2025 Regular Legislative Session, which would raise the age of medical majority to 1811 .

While there is no record of other states having passed legislation increasing the age of majority for general medical decisions, all but eight states require full parental consent for COVID-19 vaccinations, and four of those states

8 See Section 26-1-5, Code of Alabama.

9 See Senate Bill 226, Alabama Legislature 2023 Regular Session

10 See House Bill 246, Alabama Legislature, 2024 Regular Session.

11 Jacob Holmes, “Lawmaker will seek to raise Alabama’s age of medical majority”, Alabama Political Reporter, October 29, 2024, https://www.alreporter.com/2024/10/29/lawmaker-will-seek-to-raise-alabamas-age-of-medical-majorit y/, (accessed December 3, 2024).

provide only limited exception to parental consent requirements (12). As of February 2024, it is estimated that at least 23 states have implemented some type of restriction on access to gender affirming care for minors (13).

Conclusion

Alabama’s parents and legal guardians are better equipped to understand the long-term implications of medical treatments performed on their child. A minor should not be placed in a situation where they can or must make these decisions on their own. The Alabama Legislature should ensure that parents are legally part of the decision-making process and that their consent is required, with only limited exceptions.

12 Kaiser Family Foundation, “State Parental Consent Laws for COVID 19 Vaccination”, November 2021, https://www.kff.org/other/state-indicator/state-parental-consent-laws-for-covid-19-vaccination/?curren tTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D, (accessed December 28, 2023)

13 Stacy Weiner, “States are banning gender-affirming care for minors. What does that mean for patients and providers?”, AAMC, February 20, 2024, https://www aamc org/news/states-are-banning-gender-affirming-care-minors-what-does-mean-patient s-and-providers#:~:text=Across%20the%20United%20States%2C%2023,others%20are%20eyeing%20th e%20possibility, (accessed December 3, 2024).

Internet Protection of Minors

Overview of the Issue

As technology has evolved over the past 25 years, minors are more at risk to the harms of age-inappropriate online materials, harmful social media interactions, and the relatively new risks posed by artificial intelligence, which is now being used to exploit and proliferate the abuse of children.

Unfortunately, this is a case where federal, state, and local governments have been unable or unwilling to keep up with the constantly changing technological landscape. This leaves parents with less control over the online activities of their children, putting minors at greater risk, sometimes with tragic negative consequences.

Most American families feel these concerns, regardless of political leanings.

A 2023 report by security.org found that 98% of parents feel that social media platforms pose a risk to children under the age of eighteen, with most being concerned about exposure to age-inappropriate content. Over two-thirds of parents surveyed believed that stronger legislative protections from social media are necessary, and that children under the age of nine should have no access to these platforms. Nearly 90% of parents are supportive of laws requiring parental permission to grant minors access to internet platforms, with 85% believing they should have complete access to all their children’s social media accounts (1).

1 Security org, “Parents Want Stricter Legislation to Protect Kids on Social Media”, June 27, 2023, https://www security org/digital-safety/parents-react-to-social-media-legislation/, (accessed December 21, 2023)

Protecting children from harmful and inappropriate internet materials should be a top priority for Alabama lawmakers.

Current Alabama Law

In Alabama the distribution of online material is covered under the state’s obscenity law. Under section 13A chapter 12 of the Code of Alabama it is both a criminal and civil offense to distribute any harmful material to minors (2).

The Protection of Minors from Unfiltered Devices Act (House Bill 298), which was introduced by Representative Chirs Sells and more than fifty cosponsors during the 2023 regular session, would have required smartphone, tablet, and smartwatch manufactures to automatically utilize filters blocking harmful materials on any device activated in Alabama. The bill provided civil penalties for violations. House Bill 298 passed the House by a vote of 70-8 with twenty-four abstentions and received a favorable report from the Senate Fiscal Responsibility and Economic Development

2 See Section 13A-12, Code of Alabama

Committee. However, the bill failed to reach the Senate floor for final passage (3).

Critics of the bill claimed that it would create additional burdens on device manufactures and cellular service providers, though the filter is already built into most devices but not automatically activated (4).

During the 2024 regular session, Sells refiled the bill (House Bill 167) and it unanimously passed the House of Representatives with a vote of 99 yeas and 1 abstention. The bill also received a favorable report from the Senate Committee on Fiscal Responsibility and Economic Development and was expected to be considered by the full Senate in the waning days of the 2024 session but was never brought to the floor for a final vote5 .

In 2024, the Alabama Legislature did enact legislation to require age-verification for online commercial distributors of sexual material harmful to minors, House Bill 164 by Representative Ben Robbins. The bill received unanimous approval in both the Alabama House and Senate6 .

Beyond state law, Congress adopted the Children’s Internet Protection Act (CIPA) in 2000, but it is limited in scope, only applying to schools and public libraries who receive federally discounted internet access. 7 The Children’s Online Privacy Protection Act (COPPA) of 1998 imposed privacy and consent requirements, but only on websites geared towards children under the age of thirteen and dealt namely with data collection (8).

Reforms in Other States

North Carolina

During its 2023 session the North Carolina Legislature passed the Pornography Age Verification Act (Amendment to House Bill 8). The law

3 See House Bill 298, Alabama Legislature 2023 Regular Session

4 Caleb Taylor, “Adult content filter requirement bill dies in the Senate”, 1819 News, June 11, 2023, https://1819news com/news/item/adult-content-filter-requirement-bill-dies-in-senate, (accessed December 21, 2023).

5 See House Bill 167, Alabama Legislature, 2024 Regular Session

6 See House Bill 164, Alabama Legislature, 2024 Regular Session

7 Federal Communication Commission, “Children’s Internet Protection Act (CIPA), https://www fcc gov/consumers/guides/childrens-internet-protection-act, (accessed December 21, 2023)

8 Federal Communications Commission, “Children’s Online Privacy Protection Rule (‘COPPA’), https://www ftc gov/legal-library/browse/rules/childrens-online-privacy-protection-rule-coppa, (accessed December 21, 2023)

requires that “ any commercial entity that knowingly and intentionally publishes or distributes material harmful to minors on the internet from a website that contains a substantial portion of such material shall, through the use of a commercially available database that is regularly used by businesses or governmental entities for the purpose of age and identity verification, or another commercially reasonable method of age and identity verification, verify the age of the individuals attempting to access the material (9).”

To protect users ’ privacy the law requires that no identifying information be retained by the commercial or third-party age verification provider. The act provides civil penalties, including compensatory and punitive damages, for violations of the law (10).

South Carolina

In its 2023 regular session, the South Carolina Legislature introduced the Children’s Default to Safet Act to protect minors against unfiltered mobile devices. Though the bill was not enacted, it would have required manufactures of cellphone and tablet devices to automatically enable passcode protected filters that block material that is harmful to minors. The law would have applied to any device activated in South Carolina. It allowed both the state and parents/guardians to bring civil actions against device manufactures who failed to comply with the law11 . Georgia and Tennessee lawmakers have proposed but been unable to enact similar legislation in the past.

South Carolina Attorney General Allan Wilson also raised concerns about the potential harmful effects of artificial intelligence on minors. In September 2023, Wilson authored a bipartisan letter joined by all fifty states which urged Congress to thoroughly study how AI technology is being used to sexually exploit children and to propose legislation to protect children from AI abuses. According to Wilson, AI is being used to generate depictions of child sexual abuse involving children who have been abused as well as children who have not been abused, as well as digitally creating

9 See Amendment to House Bill 8, North Carolina Legislature 2023 Regular Session

10 Ibid.

11 See house Bill 591, South Carolina Legislature 2023 Regular Session.

children and then depicting that AI child being abused (12). Congress is yet to take legislative action on the issue.

Ethics and Public Policy Center Model Legislation

In October 2023, the Ethics and Public Policy Center released model legislation outlining reforms that can be implemented to better protect the online activity of minors. First, the model legislation clearly defines what types of online platforms are covered by the law. It uses a content-neutral definition because this has been upheld by federal courts. An internet platform is defined as “ an Internet website or application that is open to the public, allows a user to create an account, and enables users to communicate with other users for the primary purpose of posting information, comments, messages, images, collaborative online gaming, or videos (13).”

Next, it requires age verification for all users that goes beyond simply checking a box to acknowledge they are over the age of eighteen. Rather, users must provide a digitized identification card, a government issued ID, financial or other documents that are a “reliable” proxy for age, or any other type of reliable age-verification document. For minors under the age of eighteen it requires parental consent and age verification as well (14).

Beyond age verification, the model legislation requires that parents/guardians have full and ongoing access for minor accounts, rather than only a one-time permission to open a minor’s account. In terms of privacy protection and enforcement of the law, the bill requires that all personal information submitted for age verification be permanently deleted within seven days of its submission. The Ethics and Public Policy Center’s model legislation offers both criminal and civil penalties as a means to enforce the law (15).

Conclusion

12 South Carolina Attorney General, “Attorney General Alan Wilson urges Congress to study AI and its harmful effect on children”, Press Release, September 5, 2023, https://www.scag.gov/about-the-office/news/attorney-general-alan-wilson-urges-congress-to-study-ai-a nd-its-harmful-effects-on-children/

13 Adam Candeub, Clare Morell, and Michael Toscano, “Model Legislation for Age Verification of Social Media”, Ethics and Public Policy Center, October 17, 2023, https://eppc org/publication/protecting-kids-online-model-legislation/

14 Ibid.

15 Ibid.

While legislation does not replace the responsibility of parents to monitor the online activities of children, in today’s technology centered society it is difficult for even the most dedicated parents to know what their children are doing online at all times. Making the activation of already existing phone and device filters mandatory does not increase the burden placed on manufacturers and telecommunications companies, nor does it stop parents from turning those filters off if they wish to allow their child unfettered internet access. It is a simple solution that could improve the online safety of Alabama’s children.

Parents must have the ability to decide what their children do or do not have access to and should be able to monitor all of their children’s online activities.

Further Protect Children from Sexual Predators

Background

Alabama’s children should be able to grow up in a world where they feel protected and safe. Sadly, this is not always the case, and far too often abuse is suffered at the hands of someone who is known to the child.

According to statistics from the National Children’s Alliance (NCA), 3,504 children in Alabama served by the group suffered from some form of abuse in 2023, with 2,279 suffering from sexual abuse. About two-thirds of all abuse victims were female while one-third were male. Nearly 25% of the reported victims were six years of age or younger. In all but 173 of the cases, the victim knew their abuser. And these only include cases that were reported to NCA, meaning there are likely many more children in the state experiencing physical and sexual abuse1 .

Alabama lawmakers have a duty to protect the state’s most vulnerable citizens from all forms of abuse, and particularly sexual abuse. There are several ways to strengthen these protections, including increasing the statute of limitations in which the victim of a sexual abuse can file a civil claim against their abuser as well as increasing the penalties for rape, sodomy, or sexual torture of young children to a capital offense.

1 National Children’s Alliance, “NCA Statistics- NCA National Statistics Report 2023, https://www.nationalchildrensalliance.org/wp-content/uploads/2024/03/Alabama-Annual-2023.pdf, (accessed December 6, 2024).

Current Law

Under section 6-2-8 of the Code of Alabama, a person who “is below the age of 19 years, or insane” who falls victim to a sex offense has six years to commence civil action2 .

This includes crimes such as rape and/or sodomy in the first or second degree, sexual misconduct, sexual torture, sexual abuse in the first or second degree, indecent exposure, enticing a child to enter a vehicle, room, house, office, or other place for immoral purposes, sexual abuse of a child under the age of 12 years old, child pornography, unlawful imprisonment of the first or second degree, kidnapping, incest, traveling to meet a child or facilitating the travel of a child for an unlawful sexual act, or directing a child to engage in a sex act, among other crimes described in section 15-20A-5 of the Code of Alabama and further described in Title 13A3 .

2 See Section 6-2-8, Code of Alabama.

3 See Section 15-20A-5, Code of Alabama.

Section 13A-5-40 of the Code of Alabama statutorily defines what constitutes a capital offense in Alabama. It currently includes 21 specific types of murders. It does not include any non-murder sexual related crimes4 .

13A-5-49 describes what constitutes an aggravating circumstance which causes a specified crime to rise to the level of a capital offense for sentencing purposes5 . Section 13A-6-61 of the Code of Alabama defines the crime of rape in the first degree and provides that it is a Class A felony, which carries a penalty of up to life in prison6 . Section 13A-6-63 defines the crime of sodomy in the first degree and provides that it is a Class A felony7 .

Section 13A-6-65.1 of the Code of Alabama defines the crime of sexual torture and provides that it is also a Class A felony8 .

Under current law, rape in the first degree, sodomy in the first degree, and sexual torture are subject to a penalty of up to life in prison, without the possibility of parole if the perpetrator was over the age of 21 and the victim was under the age of six at the time the crime occurred9 . They are not currently defined as capital offenses which are subject to the death penalty.

Reforms in Other States

Several states have increased the statute of limitation for sexual crimes against children. In Tennessee civil action must be brough within the latter of 15 years after the victim has become 18 years of age or within three years from the time of discovery of the abuse. Louisiana law allows a civil claim to be filed at any time if sexual or physical abuse resulting in permanent impairment or injury occurred. If a person is convicted of a crime against a child, civil action can be filed at any time post-conviction. Florida law allows victims of sexual battery who were under the age of 16 at the time of the crime to file civil action at any time without limitation10 .

Florida

4 See Section-13a-5-40, Code of Alabama.

5 See Section 13A-5-49, Code of Alabama.

6 See Section 13A-6-61, Code of Alabama.

7 See Section 13A-6-63, Code of Alabama.

8 See Section 13A-6-65 1, Code of Alabama

9 See Section 13A-5-6, Code of Alabama.

10 National Conference of State Legislators, “Child Sexual Abuse: Civil Statutes of Limitations”, November 29,2023, https://www.ncsl.org/human-services/state-civil-statutes-of-limitations-in-child-sexual-abuse-cases, (accessed December 16, 2024).

In 2023, Florida lawmakers enacted a bill that makes it a capital felony, punishable by death or life without parole, if someone over the age of 18 commits sexual battery on a person under the age of 12 or in attempting to commit sexual battery injures the sexual organs of a person who is under the age of 12. In December 2023, prosecutors in Lake County Florida announced the first case in which they would be seeking the death sentence under the new law11 .

Tennessee

In May 2024, the Tennessee General Assembly enacted Senate Bill 1834 which allows persons convicted of aggravated rape of a child under the age of eight to face the death penalty or a penalty of life in prison without the possibility of parole12 .

Proposed Reforms in Alabama

Extend the Statute of Limitation for Civil Action in Cases Involving Sexual Offenses

For several sessions, Senator Merika Coleman has introduced a bill to extend the time period in which child victims of sexual assault can file a civil lawsuit against their abusers from six years to 36 years. Senator Coleman was previously successful in extending the statute of limitations through 2026 for victims who were abused while participating in the Boy Scouts of American. According to Coleman, her bill will provide a way to give all sexual assault survivors a chance at recourse13 .

Senate Bill 21, which has been pre-filed for the 2025 regular session would be retroactive, meaning that if a crime occurred before October 1, 2025, the extension of the statute of limitation would apply. It further provides a special two-year period from October 1, 2025, to October 1, 2027, in which any victim of a sex offense who was “time-barred from filing a civil action

11 Staff Report, “Florida prosecutor announces first death penalty case under new child rape law”, Tallahassee Democrat, December 15, 2023, https://www.tallahassee.com/story/news/local/state/2023/12/15/florida-man-first-death-penalty-indict ed-child-rape-test-case-new-law/71930977007/, (accessed December 16, 2024).

12 See Senate Bill 1834, Tennessee General Assembly, 2024 Regular Session

13 Jemma Stephenson, “Bill would extend Alabama’s statute of limitations for child abuse litigation”, Alabama Reflector, December 9, 2024, https://alabamareflector com/2024/12/09/bill-would-extend-alabamas-statute-of-limitations-for-child-a buse-litigation/#:~:text=SB%2021%2C%20sponsored%20by%20Sen,birthday%20to%20their%2055th% 20birthday., (accessed December 16, 2024).

for recovery of damages” could file a civil action, even if the crime occurred more than 36 years ago14 .

For many victims, particularly those that are the youngest, they may not have the ability to fully comprehend what has happened to them within the six-year timeframe. They also may be too scared for their own safety to come forward at that time. According to data from Child USA, most survivors of sexual abuse (65%) do not disclose that abuse until after the age of 50. 51% do so between the ages of 50 and 6915 .

Extending the amount of time in which victims of a sexual crime may come forward and pursue civil action against their abusers will further strengthen protections for Alabama’s sexual abuse victims.

Increase Penalties for Rape or Sodomy Against a Victim Under the Age of Six

Representative Matt Simpson has pre-filed a bill that would make the crimes of rape and sodomy in the first degree against a child under the age of six, as well as sexual torture against a child under the age of six, capital offenses16 .

Under current law, these crimes are subject to a penalty of life in prison without the possibility of parole if the perpetrator was over the age of 21. If Representative Simpson’s bill is enacted, perpetrators who are 18 years of age or older would be subject to a penalty of life without parole or the death penalty if convicted of these crimes. People convicted who are under the age of 18 could be sentenced to life with or without parole but would have to serve a minimum of 30 years in prison, day for day, before parole could be first considered17 .

Simpson’s bill would provide a direct challenge to a 2008 U.S. Supreme Court ruling which found that under the Eight Amendment to the U.S. Constitution it is cruel and unusual punishment to sentence any defendant to death for crimes other than homicide of crimes against the state.

14 See Senate Bill 21, Alabama Legislature, 2025 Regular Legislative Session

15 Child USA, “Delayed Disclosure: Child USA 2024 Fact Sheet”, https://childusa.org/wp-content/uploads/2024/06/Delayed-Disclosure-2024.pdf, (accessed December 16, 2024)

16 See House Bill 49, Alabama Legislature, 2025 Regular Session.

17 Ibid.

Tennessee and Florida have both passed similar laws that could challenge the Supreme Court Ruling18 .

Conclusion

Sexual crimes committed by adults against Alabama’s youngest and most vulnerable victims represent the worst of our society. It may take years for those victims to fully understand and come to terms with the trauma that they have experienced. They should not be bound by an arbitrarily short timeline in seeking recourse against their abusers. In terms of those committing these horrible acts, they must face the most serious consequences available under state law so that there is a severe deterrent in place to stop these actions before they happen.

18 Asher Redd, “Alabama lawmaker aims to put child rapists up for the death penalty”, WKRG News, December 11, 2024, https://www.wkrg.com/alabama-news/alabama-lawmaker-aims-to-put-child-rapists-up-for-the-death-p enalty/, (accessed December 16, 2024).

What is a Woman & Protection of Female Spaces

Background

There has been societal confusion regarding the definition of men, women, girls, and boys. We agree that the sexes are legally equal but possess unique and immutable biological differences that manifest prior to birth and increase as they age and experience puberty; Further, the State of Alabama has an important interest in preventing unjust discrimination, advancing equal opportunity, and maintaining safety, privacy, and fairness; the state has an important interest in ensuring the accuracy of publicly collected data related to public health, crime, civil rights, and the economic status of its citizens.

In addition, inconsistent interpretations of common sex-based words have endangered women ’ s rights, jeopardized women ’ s resources, and undermined the government’s ability to prevent unjust discrimination, advance equal opportunity, and protect privacy, safety, and fairness.

There are only two sexes, and every individual is either male or female. Individuals with congenital and medically verifiable “DSD conditions” (sometimes referred to as “differences in sex development,” “disorders in sex development” or “intersex conditions”) are not members of a third sex. “Sex” does not include “gender identity” or any other term intended to convey a person ’ s subjective sense of self; “gender identity” and other subjective terms are not synonyms or substitutes for “ sex. ” 1

Current Law

Current definitions of woman, man, girl, boy, mother, father, female, and male that have sufficed for decades are now called into question. Rep.

1 https://www iwf org/issues/sex-and-gender/

Susan DuBose, R-Hoover, said she is set to reintroduce her “What is a Woman” legislation after it failed to pass during the 2023 legislative session. 2

The bill defined men and women based on their reproductive organs. In addition, girls should know that if they are at overnight dorms, prison facilities or detention centers that they are sharing spaces with individuals of the same sex.

Proposed Reforms

For purposes of state administrative law including the interpretation, enforcement, and adjudication of official or unofficial administrative rules, decisions, policies, and guidelines the words listed below shall be defined as follows: a “ woman ” is an adult human of the female sex, and a “ man ” is an adult human of the male sex; a “girl” is a human female who is a legal minor under the laws of STATE, and a “boy” is a human male who is a legal minor the laws of STATE –provided that the use of the term “girl” or “boy” in reference to the participation of a high-school-aged individual in a school or extracurricular program shall not be understood to exclude the participation of a student who is legally an adult; a “mother” is a female parent of a child or children as defined in state law; a “father” is a male parent of a child or children as defined in state law; a “female”, when this term is used in reference to a natural person, is an individual who has, had, will have through the course of normal development, or would have but for a developmental anomaly, genetic anomaly, or accident the reproductive system that at some point produces ova; a “male”, when this term is used in reference to a natural person, is an individual who has, had, will have through the course of normal development, or would have but for a developmental anomaly, genetic anomaly, or accident the reproductive system that at some point produces sperm; “DSD conditions”, sometimes referred to as “differences in sex development”, “disorders in sex development” or “intersex conditions”, are congenital and clinically verifiable medical conditions involving irregular genes, chromosomes, or reproductive organs; “ sex ” , when this term is used

2

https://www al com/news/2024/10/alabama-lawmaker-reintroducing-what-is-a-woman-bill-in-package-targeting-t ransgender-people html

to classify or describe a natural person, means the state of being either male or female as observed or clinically verified at birth. 3

The State of Alabama has a compelling interest in preventing unjust discrimination, advancing equal opportunity, and in maintaining safety, privacy, and fairness. Any state statute, policy, or program that prohibits discrimination on the basis of sex shall be construed as forbidding unfair treatment of females or males in relation to similarly-situated members of the opposite sex. Because males and females are not similarly-situated with respect to biology and physiology, the State and its instrumentalities may operate, fund, or provide single-sex environments that are substantially related to its interest in preventing unjust discrimination, advancing equal opportunity, and maintaining safety, privacy, and fairness. Individuals with clinically verifiable DSD conditions must be accommodated consistent with state and federal law.

Reforms in Other States

Tennessee Gov. Bill Lee signed legislation in May of 2023 defining the word sex in state law, becoming the second state this year to provide an answer to the increasingly polarizing question, “What is a woman?” Senate Bill 1440 clarified that sex means “ a person ’ s immutable biological sex as determined by anatomy and genetics existing at the time of birth,” letting the state Legislature draw clear sex-based distinctions in areas such as public accommodations and scholastic sports. 4

In August of 2023, Governor Kevin Stitt of Oklahoma issued an Executive Order that outlined most of the items enumerated above. Common sense says that if a definition is needed to protect women, then specific definitions are what is needed. 5

The Louisiana the “Women‘s Safety Protection Act” was signed into law in June of 2024 by Louisiana‘s governor. It requires public schools, detention centers, prison facilities and domestic violence shelters to designate

3 https://www iwf org/issues/sex-and-gender/

5 https://www foxnews com/media/oklahoma-gov-signs-womens-bill-rights-law-protect-girls-control-gender-ideolog y 4 https://www.washingtontimes.com/news/2023/may/18/what-woman-tennessee-has-answer-gov-bill-lee-signi/

bathrooms and sleeping centers for the specific use of either males or females. The legislation defines male and females by one ‘ s reproductive system.6

Conclusion

The proposed legislation is not mean to be punitive in any way but will bring clarity, certainty, and uniformity to state law and serve as protection to women and girls in the state of Alabama.

6 https://gov louisiana gov/news/4536

Allow Homeschool students to Participate in Non-Sport Extracurricular Activities at Public Schools

Background

Many Alabamians would agree that non-sport extracurricular and technical training are important in enhancing students' educational experiences beyond curricular instruction. Engaging in these activities promotes a more comprehensive foundation for well-rounded success. Unfortunately, this sentiment is not lawfully extended to homeschooled children who are not granted permission to access these same activities. However, their families’ property taxes are funding the public school system.

All children deserve as many opportunities as possible in education. If left unaddressed, Alabama's refusal to permit homeschooled children to participate in non-sport extracurricular activities can undermine the quality of k-12 education and hurt hardworking families.

It is necessary that the Alabama legislature establish additional educational opportunities for homeschooled children. This paper makes several policies recommendations as to how to expand extracurricular and technical training course offerings for homeschooled students.

Current Law

As of October 2024, the United States Census Bureau estimates that more than 100,500 children in Alabama are homeschooled.1 Despite this number representing a steady growth of homeschooled children in the United States

with an estimated total of more than 4 million children1 , there is no state or federal policy for homeschooled students’ access to public schools’ non-sports extracurricular activities.2 School districts and schools are instead given discretion to decide whether they want to offer their classes and sports to these students. Debates about homeschooled students' right to access public schools have been ongoing as early as 2006. There have since been multiple efforts to allow homeschooled children to participate in extracurricular activities.

For example, as noted in Alabama's HB 236 (2015, lines 12–18), “This bill would create the Tim Tebow Act. This bill would define the term extracurricular to mean school-authorized athletics and athletic teams. This bill would allow a student being taught at home or at a church school to participate in athletics and on athletic teams.”3

The House passed the bill.

Next, the Committee on Education and Youth Affairs amended the bill, calling to increase “the obligations and expenditures of local boards of education by expanding the activities that students instructed at home would be allowed to participate in which would include band, music, art and all other extracurricular activities made available to public school students.”4

The bill died in the chamber.

In 2016, the Alabama High School Athletic Association passed a bylaw, Proposal 8, granting athletic eligibility for nontraditional students including homeschooled children.5 The following Fall, 60 homeschooled students were enrolled in a sport at a local public school and 40 more students joined them the subsequent Spring. In 2017, this number increased by 218, 289, and 232 homeschooled students in 2017, 2018, and 2019 respectively. 6 Alabama joins 29 states that allow homeschooled students to participate in public school sports, but current state law does not permit homeschooled students to participate in non-sports extracurricular activities.

Reform in Other States

Some states have tried to pass similar legislation to allow homeschooled children to participate in non-sport extracurricular activities at public schools but only a few have proved successful.

In Florida, homeschooled students are permitted to participate in interscholastic extracurricular activities at their assigned public schools as long as the homeschooled student meets program requirements, demonstrates academic progress through agreed-upon evaluations, adhere to residency, behavior, and performance standards, register their intent to participate in extracurricular activities, and fulfill eligibility criteria based on their academic history.7

In Georgia, Title 20 of the Official Code of Georgia Annotated is amended in Part 14 of Article 6 of Chapter 2 to include a new code, Dexter Mosely Act, which deems homeschooled children permissible to participate in extracurricular activities not limited to sports. In SB 42, eligible homeschool families must submit written intent to participate, provide current academic progress assessment, obtain instructor verification of academic standing, enroll in at least one qualifying course per semester, and meet district academic, behavioral, and residency standards.8

Oregon, under a revised statute, permits homeschooled children to participate in all interscholastic activities including public school classes, sports, and activities on condition that homeschool families notify the district, meet eligibility requirements, and maintain the child's homeschool status.9

Bipartisan success in adopting policies to permit homeschooled children to participate in non-sport extracurricular activities is evident that prioritizing student inclusion is a unifying issue.

Potential for Reforms in Alabama

Alabama lawmakers should consider implementing similar reforms to those put in place in both Florida and Georgia. The Legislature has already shown a willingness to do so for sports-related extracurricular activities, and this precedent should be extended to non-sports activities such as technical training, fine arts, theatre, band, chorus, etc. It should be left up to local

school districts and the student’s parent/guardian to participate in these activities, including whether a student is required to take any required classes, either through the public school or as part of a homeschool curriculum, as a condition of participating in the extracurricular activity.

Conclusion

Homeschooled children must have access to non-sports technical and extracurricular activities to enhance their academic development. No Alabamian family who pays taxes should be refused the privilege of public resources because of the parental choice to educate their child at home. The Alabama legislature must ensure that homeschooled students are granted equal access to technical training and extracurricular activities to support a holistic education.

1Bureau, U. C. (2024, September 24). Phase 4.2 cycle 09 household pulse survey: August 20 –September 16. Census.gov.

https://www.census.gov/data/tables/2024/demo/hhp/cycle09.html 2Alabama - Johns Hopkins Homeschool Hub Institute for Education Policy (2024, October 31) https://education.jhu.edu/edpolicy/policy-research-initiatives/homeschool-hub/states/alabam a/ 3"HB 236." Alabama Legislature, 2015

4Stallworth, S. (2015). Fiscal note for H.B. 236, Education and Youth Affairs Committee. Alabama Legislature.

5Jr., S. C. (2016, April 13). AHSAA passes “Tim Tebow rule” to allow home-schooled students to play sports at Public Schools. Alabama News Center.

https://alabamanewscenter.com/2016/04/13/ahsaa-passes-tim-tebow-rule-allow-home-schoole d-students-p lay-sports-public-schools/

6Alabama Homeschool History timeline South Alabama Homeschooling (2024, June 18)

https://southalabamahomeschooling.com/alabama-homeschool-history-timeline/alabama-ho meschool-hist ory-timeline/

7Extracurricular activities. Home. (2023, November 20).

https://fpea.com/homeschooling/extracurricular-activities#:~:text=Students%20registered%2 0with%20the ir%20districts,through%20the%20school%20district%27s%20controlled

8Georgia SB42: 2021-2022: Regular session. LegiScan. (n.d.).

https://legiscan.com/GA/bill/SB42/2021 9Kim, P., Ma, J., & Kim, J. (1970, September 1). Homeschooling in Oregon. State Regs Today.

https://www.stateregstoday.com/education-science-and-technology/education/homeschooli ng-in-oregon