June 2024 Group Watch: News & Views from the State House

While gambling legislation failed to make it through the 2024 regular session of the Alabama Legislature, those in favor of putting the issue to a statewide vote may get another bite at that apple. RSA’s Dr. Bronner says a special session on the topic is in order.

Despite licensing delays, Alabama’s medical cannabis industry is still growing, with the first legal medical cannabis crop soon to be ready for harvest. And, speaking of growing, amid positive economic development announcements, the state’s Innovate Alabama initiative just launched SEEK AL, a campaign highlighting and promoting the state’s diverse outdoor recreation opportunities, all in an effort to recruit more businesses and entrepreneurs to Alabama.

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

June 2024 Group Watch: RSA’s Bronner Calls for Gambling Special Session 

Retirement Systems of Alabama CEO David Bronner said he would like to see Gov. Kay Ivey call a special session to try again to pass a proposed constitutional amendment on gambling that failed by one vote during the annual session that ended in May. Bronner said he is concerned that leaner times are coming, and the state will need revenue to sustain progress in education and other areas. Bronner said the revenue from a gambling package could help offset tax cuts passed the last couple of years and the cost of a new school choice program, the CHOOSE Act, which will allow parents to use $7,000 in tax dollars to pay for private school, money that would otherwise support public education. Bronner said that could be a problem in a state that already lags behind other states in school funding. Lawmakers spent more than a year developing a plan for a lottery, casinos and sports betting that in its initial form would have generated more than $900 million a year in net revenue for the state. The House passed the plan, then later passed a compromise version with no sports betting. The compromise plan fell one vote short in the Senate. Approval is required to put it on the ballot for voters, who have the final say. Governor Ivey has advocated for a statewide vote on the gambling issue, including during her state of the State of the State address in February. She supported the plan that passed the House during this regular session.

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.