News No Appetite For Tax Increases As Legislature Convenes

No Appetite For Tax Increases As Legislature Convenes

No Appetite For Tax Increases As Legislature Convenes
January 28, 2016 |

Alabama farmers will be watching for possible budget cuts and a fuel tax for roads and bridges when the Alabama Legislature convenes Feb. 2.

After three legislative sessions in 2015, which highlighted voters’ opposition to tax increases, lawmakers are preparing for additional belt tightening this year.

“There seems to be little appetite for raising taxes to supplement the General Fund budget,” said the Alabama Farmers Federation’s Matthew Durdin. “We will have a clearer picture of state revenues and any projected shortfall after the budget hearings, but legislators are indicating they hope to make any necessary cuts in the regular session rather than having an extended debate requiring a special session.”

During budget hearings in January, state department heads were asked to defend funding requests using a concept called “zero-based” budgeting, which the Federation supports. In past years, state appropriations were heavily influenced by the prior year’s spending. The new process calls for agencies to disregard past funding and make requests based on need.

Legislation to unearmark funds for some agencies also is expected to be discussed this session. Supporters say it would allow government to utilize funding where it is needed most.

Durdin said interest in casino gambling has waned, but a state lottery will likely be back on the table.

“We expect multiple lottery bills to be introduced with some setting aside money for education while others would use revenues for the General Fund or Medicaid,” said Durdin, who is the Federation’s state legislative programs director in the Senate.

One revenue measure that could gain traction is a tax on fuel for roads and bridges. David Cole, the Federation’s legislative programs director in the House of Representatives, said supporters argue more fuel-efficient cars have reduced tax money available for roads.

“A five-cent-per-gallon fuel tax was introduced in the House last year, but it failed to get enough support to come up for a vote,” Cole said. “Several business groups are studying the tax along with other proposals to improve infrastructure.”

The road and bridge tax was a major topic at five regional meetings held last month by the Alabama Legislature’s Joint Transportation Committee. Past fuel tax proposals have earmarked a portion of revenues for county roads and provided for an automatic adjustment of the tax rate based on inflation.

Although budgets, taxes and gambling will likely dominate legislative deliberations, the Federation is researching bills that could protect farmers from burdensome regulation and fees increases.

In December, the Alabama Environmental Management Commission approved a 20-percent increase in fees, including those for Concentrated Animal Feeding Operations (CAFOs). The Alabama Department of Environmental Management has agreed to continue waiving CAFO fees until June 2016. The Federation will work to restore $100,000 in funding for the CAFO program in the current fiscal year to prevent out-of-pocket charges to farmers. The Federation will support $570,000 in next year’s budget to fully fund the program.

The Federation also is supportive of statewide seed standards.

“So-called GMO ordinances have already been adopted in other states,” Cole said. “Legislation being considered would affirm federal and state jurisdiction over seeds and prevent local governments from developing a patchwork of laws, which would create a financial burden for farmers.”

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