June 2024 Group Watch: State Revenue Status Update

Revenue growth in Alabama’s General Fund is still being propelled by high interest rates and was up nearly 5.5% in May compared to a year ago, and nearly 9% for the fiscal year. Revenues into the Education Trust Fun were up more than 18% in May, but overall growth is flat at .2%. The one-month growth was due to individual income tax refund payments being down compared to a year ago. Income and sales taxes are the largest sources of revenue for the ETF. As of the end of May, income tax revenue had risen .75% this year. Sales tax revenue growth is -1.5%. Separately, hourly workers in Alabama no longer have to pay income tax on overtime earnings. The cut on overtime is is having a larger impact on the ETF than originally expected; the ultimate loss in revenue could be as much as $184 million. The current year’s education budget is $8.8 billion; the General Fund budget is $3 billion. In both budgets, legislators did not appropriate all possible revenue. For FY 2025, which begins October 1, lawmakers and the governor approved $9.3 billion and $3.4 billion spending plans, respectively.

June 2024 Group Watch: Alabama’s First Medical Cannabis Crop Nearing Harvest

The CEO of Native Black Cultivation, a medical cannabis cultivation license holder, said he is nearing harvest, marking the state’s first medical cannabis harvest. He says would like to get the product into the market, but he doesn’t think that will happen unless a restraining order on dispensaries is lifted. Medical cannabis suppliers have yet to sell products three years after the Alabama Legislature approved the medical cannabis program in 2021. The Alabama Medical Cannabis Commission (AMCC) began accepting applications in late 2022. The AMCC initially issued licenses in June but voided them due to scoring inconsistencies, later rescinding awards again in August amid a lawsuit over Open Meetings Act violations. The AMCC issued new licensing rules in December, but litigation halted the licensing process again in January for dispensaries and integrated facilities. Cultivators are preparing to harvest their first crops, and they are faced with uncertainty about when that product can be sold to patients. Processor, secure transporter, and state testing lab licenses have been issued, and those licensees are working towards commencing their operations.

June 2024 Group Watch: Ready to Drink Spirits Stalled Again in AL

An ongoing effort to expand the availability of ready-to-drink mixed spirits in Alabama continues to face obstacles over industry disagreements on franchise laws, disputes that some say may be irreconcilable. The first significant effort to expand the availability of RTD spirits came in 2023 in a bill by Senator Steve Livington, which would have permitted RTD spirits with an alcohol volume of up to 12.5% to be sold anywhere that beer and wine are sold. After its failure, a bill in 2024 by Senator Bobby Singleton prosed to reduce the content cap to 8%, but it too failed. The franchise language or “territorial” designations are the biggest hurdle. The head of the Alabama Beverage Association said that her industry could support the availability of RTD spirits, but franchise language represents a non-starter for them. The Head of the Alabama Wholesale Beer Association, which represents beer distributors in the state, said that franchise language is important to wine and beer distributors due to the regulatory oversight they provide. Whether lawmakers are willing to strip any proposal of franchise language remains to be seen.

June 2024 Group Watch: Innovate AL Launches SEEK AL

Innovate Alabama has launched SEEK AL, a digital campaign showcasing the rich variety of outdoor recreational assets the state has to offer innovators looking for a place to play, work, and put down roots. SEEK AL will leverage the state’s parks, waterways, greenways and trails to position Alabama not just as a thriving innovation ecosystem, but a place that has something for everyone, whether a current resident or someone looking to relocate. The campaign launches at a time when Innovate Alabama and the Alabama Department of Commerce are collaborating with other key organizations to craft a new economic development strategic plan to propel the state’s economic growth into the next decade and beyond. Innovate Alabama will be adding an outdoor recreation grant opportunity in the next round of the Innovate Alabama Network, a comprehensive resource to connect communities fostering innovation in their own backyard.

June 2024 Group Watch: New Company Harnessing Old Natural Spring

Alabama Governor Kay Ivey joined leaders of Alabama Mineral Springs LLC to celebrate the company’s ambitious five-year project to sustainably distribute mineral-rich water from a free-flowing spring in Chilton County. Alabama Mineral Springs LLC is officially starting production at a $6 million bottling plant at the location where natural spring water was first discovered around 165 years ago. The company was formed in 2019 to capitalize on the high quality of the spring’s water, which contains a host of minerals and six of the seven naturally occurring electrolytes. Bottles of “Simply Artesian” water will be sold online and will be available at select groceries and convenience stores in Alabama, Mississippi and the Florida panhandle, with a target date of July 5. The company also plans to seek government contracts and deals with school systems.

June 2024 Group Watch: New Investment, Jobs in Pell City

Allied Mineral Products LLC is investing $23.5 million to launch an expansion of its Pell City plant that produces a variety of heat containment refractory products used in industrial applications. The growth project will add a 200,000-square-foot  production facility on the company’s site in Pell City and create 13 new jobs. The company’s workforce there now totals 81 full-time employees. Construction on the new facility is underway and expected to be completed in late 2025. In addition to the new building, the expansion will include installation of new manufacturing equipment including cranes, drying ovens and mixers. 

June 2024 Group Watch: Toyota Expanding in Huntsville

Toyota is expanding the production capabilities at its Huntsville engine factory with a $282 million investment, while also adding more than 350 new, high-quality jobs with long-term stability, according to an announcement today by Governor Kay Ivey. The growth project pushes the total investment in Toyota Alabama to more than $1.7 billion and affirms the automaker’s commitment to reinvesting profits in its U.S. operations. Toyota Alabama is the company’s largest engine producer in North America, employing more than 2,000 team members who assembled more than 770,000 engines in 2023. Mac McCutcheon, chairman of the Madison County Commission, said Toyota’s growth project will have a significant economic impact on the Huntsville region.

May 6, 2024 Group Watch: News & Views from the State House

A good bit of education-related legislation moved forward last week. The Senate approved a bill to create the state’s first health-focused high school. A bill restricting instruction on LGBTQ topics in public schools passed the House.  And a bill designed to ensure Alabama students are taught the dangers of fentanyl was approved by the Senate and now awaits Governor Ivey’s signature. 

Plus, the gambling saga continues. Bills to create a lottery and 10 casinos just narrowly failed in the Senate. Leaders say there is a chance the legislation will come up for another vote before session ends. Stay tuned. 

Find more details and info on other important #alpolitics news below.

May 6, 2024 Group Watch: Post of the Week

@GovernorKayIvey
May 2
The Alabama School of Healthcare Sciences is coming to Demopolis! I commend those of the Legislature who supported this important project, and I appreciate the support from Demopolis, healthcare systems & hospitals across our state. This is a major investment. #alpolitics

May 6, 2024 Group Watch: Day-by-Day, Play-by-Play

Tuesday, 26th day: 

• The House Economic Development and Tourism Committee approved a Senate-passed bill to provide for the establishment of research and development corridors to support economic development activities using state, federal and other public support. 
• The House Ways and Means General Fund Committee approved bills to authorize the Alabama Department of Economic and Community Affairs to facilitate and coordinate the development, improvement, maintenance, and construction of inland ports and transfer facilities within the state; to provide for a cost-of-living increase for state employees; and passed the General Fund Budget for the support and operation of the executive, legislative and judicial branches of government and for non-state agencies such as the Coalition for Domestic Violence. 
• The Senate Finance and Taxation Education Committee approved the Education Trust Fund budget for the support, maintenance and development of public education to include K-12, Community College System and four-year colleges and universities; to provide for a salary increase for K-12 education employees; a supplemental appropriation to the Advancement and Technology Fund for the current fiscal year; appropriations to non-state institutions such as Talladega College and Tuskegee University; and to create the Alabama School of Healthcare Sciences in Demopolis, Alabama. 
• The Senate saw a large number of sunset bills clear their final hurdle, including the continuation of the Alabama Real Estate Commission, the Alabama Onsite Wastewater Board and the Department of Insurance. It also passed a bill to abolish The Department of Public Health and the State Board of Health and transfer its duties to the State Committee of Public Health.

Wednesday, a committee day:

• The House Education Policy Committee approved Senate-passed bills to establish a School Security Program for public K-12 schools; to further provide for schools in Class 1 municipalities under the Alabama Accountability Act; and to authorize school chaplains for K-12 public schools. 
• The House Ways and Means Education Committee approved Senate-passed bills to further provide for companies under the Alabama Jobs Act; to provide tax considerations of Precious Metal Bullion in Alabama; and to authorize certain state matching capital loans under the Alabama Rural, Agribusiness and Opportunity Zone act, subject to appropriation. 
• The Senate Finance and Taxation Education Committee approved bills to provide for a benefit adjustment for certain retirees of the Employees and Teachers Retirement Systems; to provide for certain entities to qualify for tax credits under the federal New Markets Tax Credit program; to provide for a sale and use tax exemption for certain infant and feminine hygiene products; and to establish the Alabama Workforce Housing Tax Credit Act.

Thursday, 27th day: 

• The House passed the General Fund budget providing for the ordinary expenses of the executive legislative and judicial branches of government and bills to revise the date for submissions to qualify to be on the ballot for the 2024 general election and to increase the civil and criminal penalties for employers who violate child labor laws. 
• The Senate passed the Education Trust Fund budget and supplemental appropriations for certain agencies for the current fiscal year; the Alabama School of Healthcare Sciences Bill; appropriations for certain non-state entities such as the Southern Preparatory Academy, Talladega College and Tuskegee University; and a teacher pay raise for K-12 public school employees.