The Greatest Show on Earth

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For years these words have been associated with the Ringling Brothers Barnum and Bailey Circus. For the past two weeks they could very well have been applied to the three-ring circus that is the Alabama Legislature. This is not said to disparage the Legislature as a whole or its Membership. It refers to the multiple issues, efforts and motives that led the Legislature to be called into Special Session by Governor Robert Bentley. In the Center Ring was the Governor’s proposal to create a lottery in the State of Alabama. The Governor’s plan was a straight forward and simple plan that would have allowed for the creation of a lottery but specifically prohibited any other expansion of gambling. In this proposal all of the revenue generated would go to the State General Fund. Governor Bentley asked Senator Jim McClendon (R-Springville) to handle his legislation on the Senate Floor.

In one of the side rings Senator McClendon offered his own version of a lottery – one that not only permitted the traditional lottery games such as Powerball and Mega Millions but would have also allowed Video Lottery Terminals (VLTs) to be placed at the four existing dog tracks in Alabama. According to McClendon the VLTs would be up and running within a couple of months of the public approving a lottery in Alabama and would provide an immediate revenue stream for the State General Fund. His legislation would have also authorized a bond issue, to be repaid from receipts from the lottery, to fund the additional $85 million for Medicaid for the 2016-2017 Fiscal Year.

In the other side ring was the BP Settlement Issue and how to allocate the anticipated revenue from BP. This issue split the North and South Alabama factions in the State Senate during the 2016 Regular Session and was no less contentious to date during the 2016 First Special Session. We say First Special Session because there has been some discussion that if nothing is resolved in the final three days remaining in this First Special Session the Governor MAY call the Legislature back into a Second Special Session.

The show that was to be this First Special Session began with Sen. McClendon bringing his proposed Legislation to the Senate Floor for consideration before bringing the Governor’s proposal forward. There were a number of divergent interests working against Sen. McClendon’s proposal and after some extended debate the Senate failed to cut off debate and take a vote on his proposal. With that failure Senate President Pro Tempore Del Marsh (R-Anniston) moved to carry over the McClendon Legislation and move to consideration of the Governor’s proposal. Supporting McClendon’s Legislation were the tracks in Macon, Greene and Jefferson County. Opposing the proposal were the Porch Creek Indians, the Alabama Citizen Action Program (ALCAP), ALFA, the Alabama Forestry Association and others who fundamentally were opposed to gambling.

Next up was Governor Bentley’s proposal. A clean and simple proposal – or should it be called as clean and simple as anything can be in the Alabama Legislature. As with most circus shows there are always side shows and diversions. This was to be no different. Following a number of proposed amendments on how to split the proceeds, primarily between the State General Fund and the Education Trust Fund, proposals also came to dedicate money to Medicaid. In one of the early amendments that was adopted was a proposal to split the money 90% to the State General Fund and 10% to the Education Trust Fund by Senator Greg Reed (R-Jasper). Another amendment that was adopted reassigned the appointing authority for Members of the proposed Lottery Commission. Later during debate a slightly different version of the appointing authority was adopted that inadvertently deleted Sen. Reed’s split of the money. In a very unexpected result the proposed Constitutional Amendment passed the Senate with the requisite minimum number of vote – 21 – on Friday of the first week of the First Special Session. As the Legislature was preparing to adjourn the House and Senate agreed to return on the following Tuesday afternoon. It was assumed by most everyone that the House Economic Development and Tourism Committee would meet before the House convened on Tuesday allowing the Legislation to get its Second Reading and be in position to be debated on Wednesday. However, the best laid plans never seemed to work out. The Committee Chairman did not schedule a Committee Meeting for before the House convened and when the Chairman attempted to get leave of the House for the Committee to meet while the House was in Session he was blocked by the anti-lottery forces. The Committee was forced to wait another 24 hours before the Committee could meet and report the Legislation out of Committee. This procedural challenge seemed to have doomed the proposal because it was thought that in order for the Proposed Constitutional Amendment to be on the November 8 General Election ballot it had to be to the Secretary of State by 11:59pm on August 24, 2016. Legislative staff found a conflicting deadline in the Code of Alabama that they believed allowed the Legislature to have the Proposed Constitutional Amendment to the Secretary of State by late Friday, August 26, 2016. Secretary of State John Merrill (R-Tuscaloosa) hastily held a press conference at which he firmly stated that his opinion was that the deadline had passed and that any proposal not in his possession on Wednesday would not be on the General Election ballot. So strong was his conviction he asked the Attorney General to affirm his opinion. Less than 24 hours later Attorney General Luther Strange punted the issue back to the Secretary of State indicating that the law was not as clear as Secretary Merrill had stated and that in reality it was at the Secretary of State’s discretion as what the deadline should be. After a great deal of wrangling between the Legislature and the Secretary of State, Montgomery Circuit Judge William Shashy issued an order that compelled the Secretary of State to put any proposal in his hands on Friday, August 26 on the November ballot. On Wednesday afternoon the House Committee reported a substitute to the Senate passed version out of Committee. That Substitute corrected the language on how the proceeds would be split and eliminated duplicate language that had been inserted in the haste of the Senate passing the legislation. Thursday, August 25, saw the House spend the entire day debating the lottery legislation and late Thursday evening when a final vote was called for the proposal failed to receive the minimum number of votes to pass a proposed Constitutional Amendment. In a never say die effort House Leadership worked tirelessly to round up two additional votes, moved to reconsider the previous vote that failed and truly at the 11th hour passed their version of the lottery amendment. Among the amendments added on the House Floor was an amendment by Rep. Tommy Hanes (R-Bryant) that provided “(g) Termination of Lottery. If, at any point, the revenue generated by the Alabama Lottery is insufficient to sustain the operating costs of the lottery, the commission shall order the termination of the Alabama Lottery”. Consider for a moment what this amendment provides. If adopted and during the estimated 18 month development period there would be no revenue coming in from the lottery. Any expense incurred would exceed the revenue and the commission would be required to terminate the lottery before it ever was up and running. Fast forward to Friday, August 26, the absolute final day to pass something and get it on the November ballot. Sen. McClendon explained the House changes and made a motion to Concur with the House changes. Sen. Quentin Ross (D-Montgomery) immediately offered a Substitute motion to Non-Concur to which McClendon moved to table Ross’ motion. Lt. Governor Kay Ivey, presiding over the Senate, did not hear the motion to Table and gave control of the Floor to Ross. A number of Senators had wanted the legislation to go to Conference but in his haste to offer the Substitute Ross only moved to Non-Concur but did not add “and send the Bill to Conference”. After a good bit of filibuster a final vote was taken mid-afternoon on Friday and the proposed Constitutional Amendment for the lottery failed on a vote of 7 yeas and 23 nays. In a procedural move Sen. Tripp Pittman (R-Montrose) immediately moved to reconsider the vote and to lay his motion on the table effectively preventing any fur consideration of the proposal.

Before adjourning until September 6, the Senate resumed debate on the BP Legislation. Sen. Pittman offered an amendment to the House passed version that would take $15 million from the proposed road work for Baldwin and Mobile Counties and give it to Medicaid to fully fund Medicaid in the 2016-2017 FY budget. There are Senators that will oppose that move wanting all of the money to go to debt repayment and others wanting to provide funding for Medicaid for the next three years. This will be the paramount order of business when the Senate returns on September 6. It is anyone’s guess as to how long the BP debate will linger or as to what the final outcome will be. One this is sure and certain – the process will be as entertaining as it will be painful.

The only thing missing from the three-ring circus we witnessed over the past two weeks was someone having a beer and popcorn concession at the State House. Should the State of Alabama decide to authorize the sale of such a concession the State could possibly solve its budget problems for the coming year.

The Alabama Senate will reconvene in Special Session at 2:00pm on Tuesday, September 6, 2016
The Alabama Senate will reconvene in Special Session at 1:00pm on Tuesday, September 6, 2016
The Alabama House will reconvene in Regular Session at Noon on Tuesday, February 7, 2017
The Alabama Senate will reconvene in Regular Session at Noon on Tuesday, February 7, 2017

The views and opinions contained in this report do not necessarily reflect the views or opinions of the clients of Public Strategies, LLC