The 2023 Alabama Regular Legislative Session is over after months of work. The 2023 legislative session was marked by bipartisanship and record revenues. The state will be forever changed by the wide-ranging legislation passed this year. Here are the top ten takeaways from this session.
Record revenues – both the education trust fund budget (ETF) and the state general fund budget (SGF) were record highs. The Legislature appropriated $8.7 billion in education dollars allowing legislators to appropriate more money for reading coaches, math coaches, pre-K classrooms, higher education, workforce development, mental health counselors, and a new grant program for K-12 capital projects. If any of these new expenditures can translate into increased academic achievement for Alabama students, then the 2023 legislative session could positively impact the state for generations to come. The SGF saw increased revenues of $3.1 billion. This is almost double the SGF’s approximately $1.7 billion size from the post-Great Recession fiscal issues. This has increased expenditures for virtually every state agency, particularly mental health and the Department of Corrections.
Grocery tax cuts – Alabama tax revenues have been climbing faster than the inflation rate for the past four years. That has allowed legislators to look at ways to reduce the tax burdens on citizens of the state. Every family in the state, but particularly those of modest means, will benefit from the cut in the state tax on groceries. The first phase of this ambitious tax cut goes into effect in September, and if certain revenue targets are met in the education fund, it will be followed over the next four years with more cuts, eventually halving the state tax on groceries from 4% to 2%.
Tax cut on overtime pay – hard work is at the epicenter of achieving the American dream, but many hourly workers see their taxes go up the harder they work, often defeating the purpose of working extra shifts. The state legislature flipped that with legislation to eliminate all state taxes on workers working past 40 hours a week. This will allow workers to keep more of their pay for their families and help Alabama businesses get more out of their current workforce while increasing economic output for the state.
Economic incentives – Alabama has the lowest unemployment and the largest workforce in its history. The Ivey Administration, over the last six years, has used a highly competitive economic incentive package to lure new employers to the state. Those incentives were about to sunset, potentially hamstringing the Alabama Department of Commerce’s ability to compete for projects with other states. The administration asked the Legislature to renew and expand those incentives, and they did so, passing the Alabama Game Plan. They also passed a tax credit for businesses that use Alabama’s port of Mobile.
School choice – the Legislature passed two bills to increase school choice options for thousands more families. Previously only students zoned to Alabama’s 79 worst schools were eligible for scholarships (those that performed so badly that they earned an F on the school’s report card. That was increased to include both schools that scored a D or an F – 212. The Legislature also increased household incomes to make more students eligible for scholarships to private schools. The Legislature also passed legislation to streamline the process for greenlighting a charter school and made the Charter School Commission more responsible to the Legislature.
A billion-dollar investment in Alabama – the Legislature appropriated over a billion dollars in American Rescue Plan Act (ARPA) funds to improve the lives of Alabamians in rural and disadvantaged areas. Most of that money will go to address longstanding water, stormwater, and sewer improvement needs and expand broadband so more families can access the internet.
Ban on exhibition driving – street racing and unauthorized automotive performances of spin-outs, donuts, or other automotive acrobats have proven increasingly dangerous for races, spectators, and residents of communities where this has become prevalent. The Legislature has imposed criminal penalties on such dangerous outlaw activities.
Stiff penalties on organized retail theft – shoplifting has become endemic in the retail trade, and gangs that are systematically stealing easily marketable goods through the internet and other retail outlets have become an existential threat to retailers. As a result, the Legislature has made the crime of organized retail theft a felony. Participants in an organized theft ring will no longer be charged with a misdemeanor. Instead, those participating in these criminal enterprises, either by stealing the merchandise or receiving and marketing it for resale, will face serious prison time. Senate Bill 206 is still awaiting Governor Kay Ivey’s signature.
Crackdown on fentanyl – fentanyl is now the leading cause of death for Americans younger than 45. We have had a drug problem in this country for sixty years and an alcohol problem far longer than that, but nothing in the past has killed Americans in numbers like fentanyl has. The Legislature has responded to this increasingly prevalent narcotic found in communities and schools all across Alabama with heightened penalties on fentanyl traffickers that will put drug kingpins away for life. The Legislature also made it a serious felony to kill or injure a law enforcement officer, paramedic, or other first responder by willfully, negligently, or recklessly exposing them to fentanyl or other dangerous narcotics.
Adoption reform – anyone who has gone through the adoption process in Alabama knows that it takes too long, is overly complicated, and is far too expensive. The Alabama Law Institute also recognized this and endeavored to rewrite all the applicable statutes dealing with adoptions so that they are less onerous on citizens and it is easier to get children into their forever homes. The Legislature passed that legislation after three years of work by the lawyers and judges in the state closest to that area of law. That was the first major adoption reform in the state in three decades.
The 2024 Alabama Regular Legislative Session begins on February 6, 2024.
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