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Low taxes in Alabama may not be a good thing

Published 11:00pm Thursday, April 4, 2013

As the legislature wrestles with the crafting of next year’s budget the perennial issue of whether to cut vital services or raise new revenue is debated.

A study released late last year revealed that state and local governments in Alabama collect less tax dollars than any other state, with the exception of Idaho. This ranking of income means Alabamians have fewer tax dollars to spend on schools, police, roads and all government services than 48 other states.

Alabama’s state and local governments collect a combined $2,779 in taxes per state resident. Our sister neighboring state Florida collected $3,502, Georgia was 43rd collecting $3,108, Mississippi was 46th at $3,023 and our neighbor to the north, Tennessee, was next to us in the ranking. Their $2,875 put them at 48th very similar to us. The national average for combined state and local taxes collected for fiscal 2010 was $4,112 per person.

Speaker of the House Mike Hubbard (R-Auburn) said the low tax rate is good for the people of Alabama. “While liberals hang their heads in shame at being recognized for low taxes, conservatives like us wear the designation as a badge of honor,” Hubbard said. Gov. Robert Bentley said Alabama’s low tax collection ranking was both good and bad. “The good part is people want to come to Alabama because it is a low-tax state. Companies look at that when they are deciding where to locate.” However, Bentley continued by saying, “Medicaid, courts and other areas of state government haven’t been collecting enough money from recurring revenues to provide adequate services.”

One state court agency may be in jeopardy of getting the axe in a big way. During the GOP primary for Chief Justice last year, it became obvious that there was a distinct difference of opinion between the sitting Chief Justice Chuck Malone and former Chief Justice Roy Moore when it came to the funding and importance of the Administrative Office of Courts. Roy Moore was the big winner in that race and the AOC was the loser. Moore made it clear that the AOC may not be sacred or necessary. The Chief Justice not only presides over the nine-member Supreme Court and makes judicial decisions like the other eight justices, he is also the Chief Operating Officer of the Alabama Court System.

The Administrative Office of Courts is a support organization for the trial courts in each county in the state. Its function is to offer computer training and inform court officials about new laws passed by the legislature.

The AOC did not help their case with Judge Moore or the general public when it came to light last year that in the midst of severe budget cuts some in the AOC system got sizeable raises in pay.

State employees have not had a raise in pay since 2008. Raises have been frozen by the State Personnel Board because of the state’s financial problems. All state employees received their last cost-of-living raises on October 1, 2008.

However, the Director of the State Administrative Office of Courts circumvented the system and found a way to grant whopping 30 percent pay raises to several employees. This cavalier move did not sit well with most state employees and legislators. The director’s response was, “It’s a business decision that I had no qualms in making.”

The response of the legislature and Judge Moore to the AOC director after they look at the AOC’s funding and viability may very well be we have no qualms in closing your agency and letting you go. We will see.

Another General Fund agency which has been under scrutiny is Alabama Public Television. They have been in turmoil since early last year when state merit system employee Ferris Stephens became head of the board that oversees APTV. They had a rancorous and bitter battle over the firing of the old director. Hopefully the new director, Roy Clem, who came from the University of Alabama Public Television operation can right the ship. Currently, the television stations at the University of Alabama and Troy University have much better local programming and a larger audience. It may be time to let public television in Alabama be run by the universities. It certainly would save the State General Fund some money.

See you next week.

Steve Flowers served 16 years in the state legislature. He may be reached at www.steveflowers.us.

 

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