Alabama Politics in
Doc’s Political Parlor
& Home of Lawn Mower Repair

MONTGOMERY — Two families buy the same food at a grocery in Anniston. The same box of cereal. The same cuts of meat. The same brand of milk.

They travel to a clothing store and buy the same shirts. The same pants. The same dresses.

They pay the same 8 percent sales tax on those items – just a part of the total taxes they’ll send to Montgomery in a year.

However, by the end of that year, one of those families – making $25,000 annually – has handed 9.6 percent of its income over to state. The other family – making more than $108,000 a year – has paid a little more than 5 percent.

And when the year-end tally of the family tax burden comes, the poor will have paid the bigger percentage of their tax dollars on the goods and services they buy.

How high are Alabama’s sales taxes? Consider this: Anniston’s 8 percent sales tax – 4 percent state, 4 percent city – is only slightly lower than New York City’s 8.38 percent. And Gotham removes its city sales tax from clothing purchases under $110 and removes sales tax completely from groceries. Alabama does neither.

The state’s taxes tend to fall hardest on those making the least amount of money, and nowhere is that more evident than in the state’s complicated sales tax system. Officials and tax-reform advocates say taxes on necessities like food and clothing help drive disparities in tax collection around the state.

But with the state’s Constitution of 1901 severely restricting property tax levies, Alabama’s educational system derives most of its income from sales taxes. And tampering with the rate – or even creating exemptions for items like groceries – could be costly, according to revenue analysts.

That’s why some groups prefer to address disparities through the state’s income tax. Gov. Bob Riley has proposed raising the minimum income tax threshold from $4,600 to $15,000 over the next five years, at a total cost of about $200 million. While some groups would like to see that number go higher, most say it’s the most realistic way to create a more equitable tax system – even though the sales tax creates most of the disparities.

Equitable taxes

Sales tax rates vary from county to county, and even from commodity to commodity, with separate rates for rental properties and automobiles.

The state imposes a 4 percent sales tax on general items. Counties and cities can impose their own tax rates on other items. Calhoun County, for example, lays a 2 percent sales tax charge on general items, while the city of Anniston charges 4 percent.

The charge goes across the board, and can create deep pain, especially for the lowest level of income earners. Susan Pace Hamill, a law professor at the University of Alabama, suggests looking at a family that makes $15,000 a year. That family might spend about $8,000 on food and clothing, and could pay, on average, $727 in sales taxes on those necessities.

“The point is, we’re approaching $750 of sales tax just to scrape by, and feed and clothe a family,” she said. “You add to that $500 of income tax … We’re taking from them in the neighborhood of $1,200 in the sales and income taxes, (money) that they desperately need to survive. That’s disgraceful.”

A family making less than $13,000 a year could pay up to 10.6 percent of its income in taxes, said Kimble Forrister, state coordinator of Alabama Arise, an advocacy group for the poor.

“The sales taxes are what really push that up for the lowest income earners,” he said. “Sales taxes make up 7.3 percent of that (10 percent).”

Ideally, said Jim Williams, executive director of the Public Research Affairs Council of Alabama, a high sales tax would be offset by larger exemptions in a state’s income tax, but Alabama starts income tax rates at $4,600.

“What you should do is design them both where they will fit together well,” he said. “Georgia, which has a really low sales tax, can get away with $15,000. Mississippi, with higher sales taxes, goes to $19,600 to make a break-even proposition.”

Riley’s proposal to raise the minimum income tax threshold is considered a step in the right direction by advocates of tax reform. Forrister said it would not fix all the disparities in the system, but it was the most realistic option at this point.

“Since it’s an election year, when it comes to what Riley and a lot of us consider an immoral income tax threshold, the only achievable, winnable options are revenue neutral or a tax cut,” he said. “You can’t go for an overall tax increase.”

Built in

But cutting the sales tax without using anything to make up the shortfall would create its own problems. The state sales tax alone brought $1.8 billion into state coffers in the fiscal year that ended Sept. 30.

Sales taxes on everything except auto sales go into the state’s Education Trust Fund; the state currently puts 60 percent of auto sales taxes into the General Fund, and 40 percent into the Education Trust Fund. Not surprisingly, the Education Trust Fund depends on the sales tax, and even minor tweaks could lead to huge costs. The Legislative Fiscal Office, which gathers revenue data and information for legislators, has estimated that removing the state sales tax on groceries would cost the state roughly $275 million.

Tax reformers have focused mainly on the state’s income tax. The governor has proposed a bill that would create a sales tax holiday for the first full weekend in August of each year, but that would focus mainly on retail rather than tax relief.

“He’s just not made any proposals about sales tax except the sales tax holiday,” said David Ford, a spokesman for the governor. “He’s more focused on the income end.”

The state does exempt prescription drugs from the sales tax. State Sen. Del Marsh, R-Anniston, has introduced a bill that would exempt nonprescription drugs from the sales tax, as well as medical items like eyeglasses, contact lenses, hearing aids, wheelchairs and other devices.

“Poor families should not have to pay a tax on medicine and food,” Marsh said. “Those are necessities of life. But it’s not just for those who may be at poverty level. I think all individuals should be spared taxes on the necessities of life.”

Marsh said the bill would cost the state $5.5 million. While he favors a repeal of the grocery sales tax, Marsh said he knows the lost revenue from that would have to come from some other place.

“I don’t know where it needs to be, but I’d be for looking at the formula, and making it more fair for the less fortunate,” he said.

The income end may be a better place to tackle the problem, Williams said. Adjusting income tax thresholds would better help poorer families than cutting sales taxes, which would immediately benefit everyone.

“It provides that benefit to everybody, even those at the upper income scale, and it costs a lot of money to do that,” he said. “It targets the tax relief better if you do it through the income tax.”

The best long-term solution, say advocates, would be constitutional reform that directly addresses the property tax structure created by the Constitution of 1901, which requires most property to be assessed at no more than 10 percent of its real value and limits the amount of property tax that can be collected.

“In order to make the sales tax more fair, you have to get property taxes to pick up some of the slack,” Hamill said. “And I hope (the property tax) is not on mobile homes and old cars, but large land holdings and those with expensive homes.”

It’s time! Indeed, it’s past time to let the people vote for a constitutional convention to rewrite Alabama’s archaic, unfair, unjust and immoral 1901 Constitution. This document enshrines an inefficient, unwieldy and costly system of governance, encourages racial division, perpetuates economic injustices, shackles education advancement, handicaps local governments and reflects a profound mistrust of the citizens of Alabama.

The state Legislature will hear this message from concerned citizens and a coalition of organizations gathering Wednesday at 11:15 a.m. on the state Capitol steps along Dexter Avenue in Montgomery.

At the Let the People Vote Rally, sponsored by Alabama Citizens for Constitutional Reform (ACCR), constitutional convention proponents will present lawmakers with more than 60,000 petition signatures, all urging the Legislature to begin the process of rewriting Alabama’s 1901 Constitution.

As proposed statehouse legislation declares, a new Constitution “should provide a fundamental law by the people, for the people and of the people of the great State of Alabama, with an enduring legacy of fundamental rights of liberty and justice for all, firmly developed by the people of the State of Alabama, invoking the favor and the guidance of Almighty God.”

The first call for reforming the 1901 Constitution began early in the previous century, not long after it was ratified. A true people’s movement, however, began in earnest with the creation in 2000 of ACCR, a nonprofit, bipartisan, grassroots organization.

Last year, members of the Huntsville ACCR chapter decided it was time to stop talking and take action. Hence, the petition drive began and quickly spread through volunteer efforts at local voting polls, public events, churches and other organizations. Wednesday’s rally is the culmination of the people’s vision to let the people vote.

House Speaker Pro Tem Demetrius Newton, D-Birmingham, and Sen. Ted Little, D- Auburn, answered the people’s call by sponsoring the bills. If passed, the proposed legislation will place the convention question before Alabama voters this November.

If that ballot initiative passes, then citizens will vote in April 2007 in nonpartisan elections for convention delegates — one male and one female — from each Alabama House district. A constitutional convention would convene in July 2007 and continue through April 2008.

In November 2008, Alabamians would then have a final opportunity to accept or reject the proposed Constitution. The 1901 Constitution would remain in effect until a new one is approved. If ratified, a new Constitution would become effective in January 2009.

Hence, Alabamians could vote three times before a new Constitution becomes effective. What on earth could be controversial in our great democracy about letting the people vote?

Alabama has had six Constitutions. Thus, there’s nothing unique about a people’s constitutional convention, and certainly nothing to fear about letting the people vote. Alabamians have done it before. They are wise enough to do it again. Just as citizens are asked to trust legislators when voting for them, the citizens are asking the legislators to trust them to vote.

Demagoguery and lies, familiar Alabama political fear tactics by status-quo special interests, will no longer hoodwink the electorate.

The proposed legislation, developed by the people and the sponsors together, is rooted in truth and trust with safeguards against special-interest control, including:

• Prohibiting lobbyists from giving anything of value to any convention delegate.

• Prohibiting any delegate from receiving any political contribution from any one source in an amount in excess of $100 in cash or in-kind.

• Prohibiting any post-delegate election contributions.

• Applying all Fair Campaign Practices Act and Alabama ethics law requirements to the delegate elections and Convention process.

• And requiring all lobbyists to register and file reports during the convention to ensure that it’s the people’s voices, and not special interest money, controlling the convention.

Wednesday’s historic rally will begin and end with Alabama students reading the 1901 Constitution and its nearly 800 amendments while standing on the Capitol steps. The reading starts at 9 a.m. and ends at 9 p.m.

Every legislator has been invited to attend, and the House and Senate leaders have been asked to welcome the people and to receive the petitions.

Courageous sponsors of the 2006 Let the People Vote legislation (HB109 and SB52), Rep. Newton and Sen. Little, are the rally’s featured speakers, along with co-sponsors Rep. Thomas Jackson, D-Thomasville, and Sen. Hap Myers, R-Mobile.

So, now this drive is in the hands of the Legislature. Will Montgomery trust the people of the State of Alabama and pass legislation to let the people vote? The sponsors and cosponsors of HB109 and SB52 have gone on record as trusting the people. Will your legislator trust you?

House Constitution and Election Committee Chairman Randy Hinshaw, D-Huntsville, has also heard the call and scheduled a public hearing on HB109 on Wednesday at 8 a.m. in the Capitol auditorium.

Sen. Wendell Mitchell, D-Montgomery, chairman of the Senate Constitution, Campaign Finance, Ethics and Elections Committee, has also responded by agreeing to schedule a public hearing on SB52 in February. Both chairmen have also been invited to address Wednesday’s rally.

The drive for a new Constitution has begun in the minds and hearts of Alabamians. Wednesday’s Let the People Vote Rally is the first step in creating an exceedingly great army of citizens and public servants, together as one and in unity of purpose, invoking the favor and the guidance of Almighty God, to birth a brand-new day for Alabama.

All citizens are urged to attend the rally. To sign a petition, available on ACCR’s Web site, visit www.constitutionalreform.org. And encourage your state legislator to attend the rally, and, ultimately, to trust Alabamians and let the people vote.

Birmingham resident Lenora Pate is co-chair of Alabama Citizens for Constitutional Reform.

Sometimes I think our legislators don’t take us very seriously.

Many of them think that if they give a nod to some of our hot-button issues and dole out some of our own money to projects we’re interested in, we’ll keep sending them back to Montgomery.

We are barely into the current legislative session, and there’s already evidence to support that notion.

The Legislature is working on new legislation to get around a state Supreme Court decision that stopped them from handing out millions of dollars of taxpayers’ money for “special projects” of their choosing in their districts.

The court ruled last fall that the Legislature can appropriate money to various agencies, but legislators can’t then bypass the executive branch and direct the money to pet projects.

Legislators call the money “community service grants,” although a more familiar name would be pork. According to news reports, the new measure would enable each house member to request at least $51,200 in grants; senators could request at least $153,600.

To get around the court ruling, the bill would create an executive branch commission, made up of the lieutenant governor, agriculture commissioner and state schools superintendent, which would have to approve or reject each grant proposed by lawmakers. It’s difficult to believe that any of those officers would buck legislators who have ample means of retaliating.

Being able to hand out checks for projects that they deem worthy lets legislators get their pictures in the newspapers and gets them pats on the back from groups that thank the senator or representative for “giving” them money.

While that is going on, the legislative session is also beginning to look like a board of deacons meeting.

One bill that’s been proposed would give citizens the option of having the phrase “God Bless America” on their license tags.

Another proposal would let teachers and principals display “In God We Trust” in public schools.

A third bill would have public schools offer a class based on the book “The Bible and Its Influence.” It would be the only school class that I can think of whose specific textbook was prescribed by the Legislature.

There’s also a bill that would let voters decide on an amendment to the state constitution to authorize display of the Ten Commandments at the Capitol.

Yet another measure would protect from disciplinary action teachers who give “scientific critiques” of prevailing theories (think evolution).

Some of these measures are authored by Democrats, which has led some Republicans to claim that the Democrats are just trying to hijack their issues. I’m not sure Republicans should be so proud to claim ownership of such transparently self-serving efforts.

They can call them “faith-related issues,” but they are easy, showy measures more aimed at currying the favor of a segment of the voters than on having a real impact on either the quality of life in the state or its moral climate.

I don’t know who has a greater claim at being offended, those who think the “faith-related” bills are just plain bad or those who like the ideas but who see the measures as shameless election-year pandering.

Pundits cite history and tell us to expect those kinds of things. Little of substance actually gets done in the last year of a legislature’s term. That raises the question of why we pay legislators the same amount for an election-year session as we do for the other three years.

I’ve seen a quotation attributed to H.L. Mencken that “nobody ever went broke underestimating the intelligence of the American public.” (Some sources use the word “taste” instead of “intelligence” in the quote.)

Perhaps our legislators think that nobody ever lost an election underestimating the intelligence of the Alabama voter.

Could they be right?