Surging economy boosts Alabama 2018 General Fund and ETF Revenues

Thanks to a booming economy, Alabama saw significantly increased revenue to both the General Fund and the Education Trust Fund (ETF) in 2018, with collections far exceeding expectations.

By the September 30 end of the 2018 fiscal year, collections for the state General Fund were up 4 percent or $76 million over FY2017, bringing in just under $2 billion. Revenue to the ETF grew by 6.7 percent, up $426 million over 2017, for a total of $6.7 billion in 2018.

Both funds ended the year with a balance, with revenues exceeding expenditures by $80 million in the General Fund and $336 million in the ETF. The balance in the General Fund will be available to fund either supplemental appropriations or to pad to the 2020 budget. A portion of the ETF balance, $64 million, will be shifted into what’s called the budget stabilization fund, which was set up as an auxiliary savings account which can be tapped if the economy contracts. The remaining $272 million of surplus will be shifted into the advancement and technology fund. The Legislature can spend that fund for certain purposes including the purchase of education technology and equipment.

Strong growth in the General Fund can be credited to the growing economy, but also to decisions by the Legislature in recent years. The General Fund traditionally saw little growth even when the economy was expanding because growth taxes, principally income and sales taxes, were all deposited in the ETF. However, the Legislature shifted some sales taxes, particularly a portion of the sales taxes on goods sold over the internet, to the General Fund. Strong growth in those taxes padded the General Fund’s bottom line.

The effects of the federal tax cut also had something to do with the increased revenue. When federal taxes go down, Alabama collections go up since federal income taxes are deductible from state income taxes. When individuals and corporations pay less in federal taxes, a greater share of earnings is subject to the Alabama income tax. Budget officials in Montgomery have estimated that the difference in the federal tax law will mean an annual boost to Alabama receipts in the $30 to $40 million range.

The rosy revenue picture is not clouded by huge impending financial needs as it has been in the past. Cost growth in Medicaid has slowed, and Congress has extended federal support for the Children’s Health Insurance Program, which was an uncertainty earlier this year. The one area of persisting uncertainty is the amount that will be needed to comply with a federal court order to improve conditions in prisons.

The General Fund

The General Fund grew robustly even though it didn’t receive the $50 million per year deposit it had been receiving from a settlement resulting from the BP Oil Spill. The fund also paid out $11 million in a settlement to AT&T. AT&T had collected and paid to Alabama taxes on wireless data plans. Under federal law, internet access is exempt from taxation. Cellular voice service is subject to taxation, and the mobile telecommunications tax used to be a major revenue source. However, wireless companies have lowered their charges to customers for voice calling and shifted much of the cost of service to data plans, which aren’t supposed to be taxed. Proceeds from the tax are now about half what they were in 2013.

Another declining tax source for the General Fund is the tobacco tax. The tax brought in $155 million in 2018, almost $9 million less than the year before.

But those and other declines were more than offset by growing revenue from other sources. Insurance company taxes and corporate taxes were up by $30 million and $21 million respectively. Bringing in $349 million in 2018, the tax on insurance policies is the largest individual source of revenue to the General Fund.

Thanks to rising interest rates, the revenue from interest on state deposits increased by $18 million. Revenues from the Alcoholic Beverage Control Board were up by $15 million. The portion of the Use tax that goes to the General Fund increased $14 million. The Simplified Seller’s Use Tax, a sales tax on online purchases, was up $10 million. Revenue disbursed from the state’s abandoned property fund was up by $9 million.

 

The Education Trust Fund

The biggest boost to the state bottom line came through collections of the income tax, which were up 8.2 percent, as more people were working and earning more money.

Sales taxes increased 5.34 percent as consumers spent more. These are the highest growth rates since before the great recession, and the overall 6.7 percent growth in the fund during 2018 is the highest growth rate seen since prior to the Great Recession.

The strong performance in 2018 indicates the state should not have a problem meeting the spending levels set in the 2019 budgets. The Legislature budgeted spending $2 billion from the General Fund and $6.6 billion from the Education Trust Fund in 2019.

 


PARCA Statewide Constitutional Amendment Analysis

When voters go to the polls on November 6, they’ll not only be electing a governor, legislators, and other state and local officials, they’ll also be asked to vote on 19 new amendments to the Alabama Constitution of 1901. Voters statewide will decide whether to add four proposed amendments that will apply throughout the state. In addition, 15 local amendments will be voted on only in the counties in which they would apply.

The Alabama Constitution is unusual. It is the longest and most amended constitution in the world.  There are currently 928 amendments to the Alabama Constitution.


Most state and national constitutions lay out broad principles, set the basic structure of the government, and impose limitations on governmental power. Such broad provisions are included in the Alabama Constitution. However, Alabama’s constitution delves into the details of government, requiring constitutional amendments for basic changes that would be made by the Legislature or by local governments in most states. Instead of broad provisions applicable to the whole state, about three-quarters of the amendments to the Alabama Constitution pertain to particular local governments. Amendments establish pay rates of public officials and spell out local property tax rates. A recent amendment, Amendment 921, grants municipal governments in Baldwin County the power to regulate golf carts on public streets.

Until serious reforms are made, this practice will continue, and the Alabama Constitution will continue to swell.

Statewide Amendment 1

“Proposing an amendment to the Constitution of Alabama of 1901, providing for certain religious rights and liberties; authorizing the display of the Ten Commandments on state property and property owned or administrated by a public school or public body; and prohibiting the expenditure of public funds in defense of the constitutionality of this amendment.”

Amendment 1 and Amendment 2 are proposed amendments to the Alabama Constitution, but they both concern rights and protections that are governed by the U.S. Constitution and the U.S. Supreme Court’s interpretation of federal law and the Constitution.

Since the U.S. Constitution supersedes state law and the state Constitution, both these proposed amendments would not have any immediate legal effect. They are more like statements of opinion. However, considering the recently altered composition of the U.S. Supreme Court, those Alabama amendments could become operative as the new court addresses cases that may alter established precedent.

Amendment 1, proposed by Act 2018-389, restates principles of the separation of church and state that currently exist in Section 3 of the Alabama Constitution of 1901 which reads:

That no religion shall be established by law; that no preference shall be given by law to any religious sect, society, denomination, or mode of worship; that no one shall be compelled by law to attend any place of worship; nor to pay any tithes, taxes, or other rate for building or repairing any place of worship, or for maintaining any minister or ministry; that no religious test shall be required as a qualification to any office or public trust under this state; and that the civil rights, privileges, and capacities of any citizen shall not be in any manner affected by his religious principles.

The new proposed amendment adds to that by specifically authorizing the display of the Ten Commandments on public buildings, public property, and public schools, as long as that display is made in conformity with Constitutional principles.

As interpreted by the U.S. Supreme Court, a display of the Ten Commandments on public property is allowed, but only if it is not a specific endorsement of a religion. Displays of the Commandments are permitted when they are contained in a secular context, surrounded by other educational and historical displays. For example, the display might include other historical documents, like the Code of Hammurabi, the Magna Carta, the Declaration of Independence, the U.S. Constitution or historical documents or personalities associated with the development of law.

The proposed amendment also specifies that no public funds may be expended in defense of the constitutionality of the amendment. That prohibition of public funding for the defense of the amendment would not prevent public funds being expended to defend a challenge to the constitutionality of a specific display of the Ten Commandments created by any agency or local jurisdiction.

Statewide Amendment 2

“Proposing an amendment to the Constitution of Alabama of 1901, as amended; to declare and otherwise affirm that it is the public policy of this state to recognize and support the sanctity of unborn life and the rights of unborn children, most importantly the right to life in all manners and measures appropriate and lawful; and to provide that the constitution of this state does not protect the right to abortion or require the funding of abortion.”

Amendment 2, proposed by Act 2017-188, concerns the state’s position on abortion rights and the rights of “unborn children.”

It would add an amendment to the Alabama Constitution that would specify that it is the “public policy of this state to recognize and support the sanctity of unborn life and the rights of unborn children, including the right to life.” The proposed amendment does not define at what point a fertilized embryo or developing fetus would be considered an unborn child. The amendment also specifies that “nothing in this Constitution secures or protects a right to abortion or requires the funding of an abortion.”

The right to an abortion is currently protected by the Supreme Court’s 1973 Roe v. Wade decision. In Roe, the Court ruled that governments, federal, state, and local, could not prohibit a woman from having an abortion during the first trimester and placed limitations on state regulation of abortion in subsequent trimesters. The Court held that a woman’s right to an abortion fell within the right to privacy (recognized in Griswold v. Connecticut) protected by the Fourteenth Amendment. As summarized by Oyez, a compendium of information on the Supreme Court compiled by Cornell’s Legal Information Institute, Justia, and Chicago-Kent College of Law, the Roe decision gave a woman total autonomy over the pregnancy during the first trimester and defined different levels of state interest for the second and third trimesters.[1]

In subsequent Supreme Court cases, the Court preserved the right to an abortion but allowed states to regulate abortion and to ban it after the fetus had reached viability, the point at which the fetus could survive outside of the womb. Other restrictions on abortion throughout pregnancy were permissible, the Court ruled, if those restrictions did not put an “undue burden” on a woman’s ability to obtain an abortion.

In Alabama, abortion is prohibited when the pregnancy has reached 20 weeks, except in cases of life or health endangerment to the mother. Alabama has also passed numerous regulations pertaining to all abortions. In Alabama, abortions must be performed by a licensed physician. Abortion providing facilities must meet multiple requirements. If the fetus is deemed viable, the abortion must be necessary to preserve the life and health of the mother, a second physician must participate, and it must be performed at a hospital.

Public funding can only be used for an abortion in the case of life endangerment or rape or incest. Alabama requires pre-abortion counseling and a 48-hour waiting period after counseling. If a minor is involved, a parent must give his or her written consent before the procedure can occur.

A 2016 Alabama law would have criminalized dilation and evacuation (D&E) procedure, a procedure used throughout pregnancy and the most common method of second-trimester abortions. In August of 2018, the 11th U.S. Circuit Court of Appeals in Atlanta upheld a lower court ruling blocking the law, finding that the ban would create and undue burden on the right to end a pregnancy before the fetus is viable.[2] Alabama also has not repealed its law that was in place before Roe v. Wade.[3] That law makes it a crime to perform an abortion and contains no exceptions for the life or health of the mother.

Passage of the proposed amendment to the Alabama Constitution would not have any practical effect under current law. However, if the Supreme Court were to overturn Roe vs. Wade and turn abortion regulation back to the states, the language in the Alabama Constitution would potentially have an effect. Any attempt to alter restrictions on abortions could be challenged on the grounds that it would harm the right to life of unborn children. If states were granted the full authority to regulate abortion, the rights to life and liberty guaranteed to individuals (the mother, in this case) in Section 1 of the Alabama Constitution would have to be weighed against the right to life of an unborn child contained in this amendment, if it is adopted.

Abortion rights groups, like Planned Parenthood, and anti-abortion groups, like the Eagle Forum of Alabama, agree that Amendment 2 would lay the groundwork for an abortion ban in Alabama if Roe v Wade is overturned.

Statewide Amendment 3

“Proposing an amendment to the Constitution of Alabama of 1901, relating to the Board of Trustees of the University of Alabama, to specify that the congressional districts from which members are appointed continue to reflect those as constituted on January 1, 2018, to remove the State Superintendent of Education from membership, and to delete the requirement that members vacate office at the annual meeting of the board following their seventieth birthday.”

Under current law, the University of Alabama Board of Trustees is composed of 16 people: three members from the congressional district in which the Tuscaloosa campus is located, two members from each of the other six congressional districts in the state, the Governor, and the State Superintendent of Education. If the number of congressional districts in Alabama increased or decreased in the future, the number of trustees would also increase or decrease. Additionally, other than the Governor and the State Superintendent of Education, current law requires a trustee to retire from the board following his or her seventieth birthday.

Amendment 3, proposed by Act 2018-132, does three things:

First, it provides that the board will be composed of members from congressional districts as those districts existed on January 1, 2018.  This eliminates the need to make changes based on the number of congressional districts in Alabama. It does not impact the number of board members. Based on population trends, Alabama is at risk of losing a congressional seat in the U.S. House of Representatives.[4] Second, it removes the State Superintendent of Education from automatically having a seat on the board. The Superintendent currently serves on the Auburn University Board of Trustees.[5] The State Superintendent was removed by statute from the board of the University of North Alabama in 2018 but remains on the board of the University of West Alabama.[6] Third, it allows a trustee to serve after his or her seventieth birthday.

Composition of the governing boards for SEC universities varies. Currently, in addition to the University of Alabama System, the Universities of Arkansas, Missouri, and South Carolina also have a state superintendent on the boards.[7]  The Universities of Florida, Kentucky, and Tennessee include seats for faculty members on the governing boards, with the University of Florida having two such positions and the University of Tennessee Board of Trustees rotates the position by each of its four instructional institutions.

Along with the Universities of Arkansas and Georgia, both Auburn University and the University of Alabama System rely on congressional districts for apportioning seats on their boards, while the Mississippi State Institutions of Higher Learning apportions seats by each of its supreme court districts, and the University of South Carolina recruits board members from each of its 16 judicial districts through a College and University Trustee Screening Commission.[8]

Tennessee requires that the governor appoint at least two residents from each of the state’s three grand divisions, with at least five of the members being alumni of the University of Tennessee, and at least seven must be residents of Tennessee.[9] Missouri requires that board members be U.S. citizens and residents of the state for at least two years. Missouri also prohibits more than five members being from one party.

If a majority of voters vote “Yes” on Amendment 3, future changes to the number of congressional districts in Alabama will not change the number of board members. The State Superintendent of Education will no longer be an ex-officio member of the board, and trustees will be allowed to serve on the board after their seventieth birthday.

If a majority of voters vote “No” on Amendment 3, future changes to the number of congressional districts in Alabama will have an impact the number of board members, the State Superintendent of Education will continue to have an ex-officio seat on the board, and trustees will not be allowed to serve on the board after their seventieth birthday. 

Statewide Amendment 4

 “Proposing an amendment to the Constitution of Alabama of 1901, to provide that, if a vacancy in either the House of Representatives or the Senate occurs on or after October 1 of the third year of a quadrennium, the seat would remain vacant until a successor is elected at the next succeeding general election.”

Every four years, all members of the Alabama State Senate and House of Representatives stand for election. The subsequent four-year term for which those Senators and Representatives are elected is called a quadrennium.

Currently, if a seat in either house of the Legislature becomes vacant during the quadrennium, a special election must be conducted in order to fill the vacant seat. The Governor must call for a special election if the vacancy happens before the next scheduled general election. The governor has discretion in setting the date of the election along with the nominating deadlines. This special election to fill vacancies can be held at any time during the four-year cycle, and the winner fills the term until the next general election.

When a special election is held, all costs and expenses incurred are paid from funds in the State Treasury not otherwise appropriated. Each legislative special election costs the state roughly $120,000.[10]

Alabama is one of twenty-five states in the U.S. that fill vacancies in the state legislature through special elections. Twenty-two states fill vacancies through appointments and three states fill vacancies through a hybrid system that uses both appointments and special elections.[11]

Amendment 4, proposed by Act 2018-276, would keep the current procedures for calling a special election in place but would change the current law so that when a vacancy occurs in the Senate or House of Representatives on or after October 1 of the third year of the quadrennium, the seat will remain vacant until the next general election – approximately 14 months or less.

The Governor would no longer have the power to schedule a special election to fill a vacancy in these circumstances, and public funds that would have been spent on the special election would be saved.

This amendment would not apply to U.S. Congressional or Senate seats.

If a majority vote “Yes” on Amendment 4, state legislative seats that become vacant within the final 14 months of the four-year term of office will remain vacant until the general election.

If a majority vote “No” on Amendment 4, the Governor will continue to be required to schedule a special election whenever a vacancy occurs in the state legislature.

For more information, see the analysis provided by the Alabama Fair Ballot Commission at https://sos.alabama.gov/alabama-votes/voter/ballot-measures/statewide.

[1] “Roe v. Wade.” Oyez, 3 Oct. 2018, www.oyez.org/cases/1971/70-18.
[2] Stempl, Jonathan. U.S. appeals court finds Alabama abortion law unconstitutional. Reuters. August 22, 2018. https://www.reuters.com/article/us-alabama-abortion/us-appeals-court-finds-alabama-abortion-law-unconstitutional-idUSKCN1L71ZP
[3] Ala. Code § 13A-13-7
[4] Cason, Mike. “Amid Census Controversy, Alabama Launches ‘Maximum Participation’ Effort,” Tribune News Services, http://www.governing.com/topics/politics/tns-alabama-ivey-census.html
[5] A member of the State Board of Education sits, ex officio, on the Alabama College System Board of Trustees for the two-year college system. See https://www.accs.cc/index.cfm/board-of-trustees/
[6] See https://www.billtrack50.com/BillDetail/914457; University of West Alabama Board of Trustees, https://www.uwa.edu/about/boardoftrustees
[7] In Arkansas, the Superintendent of Public Instruction is the board president and votes as a tie breaker, like U.S. Vice President does in the Senate.
[8] College and University Trustee Screening Commission https://www.scstatehouse.gov/CommitteeInfo/Universities&CollegesScreeningCommittee/Univ&CollScreening.php
[9] HB 2115 http://wapp.capitol.tn.gov/apps/BillInfo/Default.aspx?BillNumber=HB2115
[10] Gattis, Paul. “’No logic’ to Alabama’s special elections, which may be outlawed anyway.” AL.com March 2, 2018. https://www.al.com/news/huntsville/index.ssf/2018/03/no_logic_to_alabamas_special_e.html
[11] How vacancies are filled in state legislatures, Ballotpedia.com https://ballotpedia.org/How_vacancies_are_filled_in_state_legislatures


Government Corruption and Ethics Ranks #3 Among Alabama Voter Priorities

In late 2017, the Public Affairs Research Council of Alabama (PARCA) surveyed Alabama voters to determine their thoughts about the general direction of the state and the issues that most concern them. PARCA partnered with Samford University to survey policy professionals from across the state including academics, journalists, business and nonprofit leaders, and lobbyists. Their responses provided a list of 17 critical issues facing Alabama. PARCA partnered with USA Polling at the University of South Alabama to ask registered voters about these 17 issues. The voters’ responses generated the Top Ten list of voter priorities. Details about the survey and its methodology can be found in the full Alabama Priorities report.

Alabama Priorities

1. K-12 Education
2. Healthcare
3. Government Corruption and Ethics
4. Mental Health and Substance Abuse
5. Poverty and Homelessness
6. Jobs and the Economy
7. Crime and Public Safety
8. Job Training and Workforce Development
9. Improving the State's Image
10. Tax Reform

Key Findings

  • Voters broadly agree on the critical issues facing the state.
  • Voters are not polarized along traditional political, ideological, racial, or generational lines. There is a significant gap between the priorities of experts and the priorities of voters.
  • Policymakers have an opportunity to inform and educate voters on critical and systemic challenges facing the state.
  • Policymakers have an opportunity to respond to immediate, often highly personal issues that concern voters.
  • Elected officials and candidates have an opportunity to show leadership and to build broad coalitions to address Alabama’s most pressing challenges.

This summer and fall, PARCA will produce summary briefs on each of the top ten priorities chosen by Alabama voters. Each brief will answer four critical questions: what is the issue, why it matters, how Alabama compares, and what options are available to Alabama policymakers.

#3: Government Corruption and Ethics

What is the issue?

Government corruption and ethics is the 3rd most important issue for Alabama voters. Nearly two-thirds of respondents, 65%, indicated that they were very concerned about the issue. On a scale of 1 – 5 where 1 is “not at all concerned” and 5 is “very concerned,” respondents on average rated corruption and ethics 4.24.

By comparison, only 47% of voters indicated they were very concerned about the issue of tax reform and only 56% were concerned with jobs and the economy.

Majorities of nearly every demographic or political group are concerned, but there are some differences among partisan identifiers: a majority of Republicans are very concerned, while two-thirds of independents and over 80% of Democrats are very concerned.

For Republicans, Government Corruption and Ethics ranks 7th in the top ten issues; for both Independent and Democrats, it ranks as 3rd.   Conservatives rank it 5th; moderates, 2nd; liberal, boomers, and the Greatest/Silent generation, 3rd. For Gen Xers and for millennials, government corruption and ethics ranks 4th, behind K-12 education, healthcare, and mental health or poverty and homelessness, respectively.

The issue of corruption has drawn a great deal of attention in Alabama’s media for decades as the result of several high-profile scandals involving state officials. Alabama’s most eminent historian, Wayne Flynt, recently noted that three of the last six elected governors have been removed from office due to some form of corruption.[1] The previous Speaker of the House, several legislators, and community college administrators have been convicted on corruption charges, as have some local officials, such as those involved in the scandal surrounding the Jefferson County sewer system.

The key feature of corruption is the diversion or use of public resources for private use, whether to an official or to the official’s supporters, businesses, friends, family, or others. Self-dealing is a common feature, with bribery and corruption usually spoken in the same breath, while graft is also used to describe various kinds of illegal side payments. While bribery, a quid quo pro arrangement with a public official for an official act, is almost universally illegal, there are loopholes and legal blind spots that allow some behaviors to avoid legal sanctions.

Why Does Corruption Matter?

Empirical studies[2] have correlated public corruption with numerous negative outcomes, including:

  • bureaucratic inefficiency
  • low business investment
  • poor health outcomes
  • weakened civil and political rights
  • slower economic growth
  • higher income inequality and poverty
  • loss of political legitimacy
  • expansion of black markets or shadow economies
  • “brain drain”
  • fiscal deficits
  • weakened education system

The economic effects could perhaps be seen in Alabama’s slower than average economic recovery after the Great Recession, which also meant that Alabama’s education revenues were among the slowest to recover as well, creating a vicious cycle of poor performance.[3] These factors may chase off educated people and deter highly-skilled people from considering moves to Alabama.

Corruption diminishes opportunities for economic and social advancement, causing highly skilled people to leave, resulting in a brain drain and diminishing the economic vitality of the state

Voter concern about government corruption in Alabama is cause for concern for policymakers. People outside Alabama can be deterred from investing in Alabama, and highly-skilled people in Alabama may emigrate to other states, as many of the state’s college-educated residents tend to do.[4] Fortunately, there is also a great wealth of research on how to minimize corruption. Most of those methods involve removing the opportunity to engage in corrupt behavior. Of course, resistance to reform is typically most intense by those who benefit from lax controls and private gains from the status quo.

How Does Alabama Compare?

Some practices, typically prohibited in other states, have long skirted ethical boundaries in Alabama. Activities such as dual office holding, nepotism in employment, revolving doors between legislators and lobbyists, as well as legal but questionable practices, such as allowing sheriffs to pocket monies intended to feed inmates have drawn scrutiny. Until the passage of the 2010 ethics law, fees paid to legislators for referring people to lobbyists were not considered illegal. Instances such as these have been highlighted in Pulitzer Prize-winning news reports and commentaries by reporters for Alabama newspapers and frequently provided leading stories for Alabama radio and television stations.[5]

Alabama has also received attention from organizations that are specifically focused on government corruption. The Center for Public Integrity has produced two 50-state studies, under the banner of State Integrity Investigation: one in 2012 looking at 14 specific categories of state government and a slightly modified follow-up in 2015 looking at efforts to fight corruption.[6] Alabama earned a C- minus in 2012 and a D+ in 2015.

Although Alabama’s grade declined from a C+ to a D- between the two studies, the ranking of Alabama actually improved as so many other states also declined in their rankings. In the 2015 study, Alabama scored well in executive accountability and internal auditing but had problems with public access to information and political financing. Other areas of concern included judicial accountability, state civil service management, procurement, and lobbying disclosures.

Institute for Corruption Studies (ICS), an independent research institute within the Department of Economics at the Illinois State University, produces a Corruption Convictions Index which tracks the number of public corruption convictions per 100,000 state employees. In 2015, Alabama had 4.12 convictions per 100,000 state employees,[7] 11th highest among the 50 states. However, in 2006 it was 11.02 per 100,000, the 3rd highest total; and in 2007 11.13 per 100,000 the 2nd highest. Those high rankings came in the wake of convictions concerning the Jefferson County sewer system and the two-year college system.  Again, this is a lagging indicator of corruption as cases may take years to build and the number of defendants may be quite large for some instances of corruption involving multiple people colluding.

In 2018, ICS ranked Alabama as the having the most perceived corruption in the United States based on data from its fourth Corruption in America Survey done in 2017. The map below combines the aggregate scores for both types of corruption in all three branches. Alabama’s combined aggregate score was the highest in the United States.

What Can We Do?

The historical absence of strong structures to monitor and prevent corruption have resulted in attempts to shore up the legal foundations for prosecuting corruption, with one such legislation passed in 2010. In 2011, the legislature also provided a guaranteed budget to the Ethics Commission.  The 2010 law, together with subsequent reforms, also made it illegal for public officials and employees to accept most gifts valued at $25 or more. Subsequent to passage, the commission began a training program to ensure that officials and employees knew details of the ethics laws.

Spend Money Where it Matters

Electing “better people” has almost no empirical foundation. Watching people who are elected more closely has a great deal of empirical support, especially when transparency about their activities is accompanied by vigorous enforcement and sanctioning capabilities.

Eliminating opportunities for corruption by eliminating the conditions for self-dealing has been effective in stopping corruption as well.[8] To stop corruption, there have to be independent eyes and ears in the field, with the capacity to review records and investigate reports of wrongdoing. Local news reporting has been shown to reduce the costs of local government as a result of their presence.[9] Auditors and inspectors general almost always produce a high return on investment.[10]

One of the key functions of the Alabama Ethics Commission is to educate public officials on the ethics law. Ironically, at least one of the same legislators who passed ethics reform has been convicted of violating the new law. Would training have helped? What evidence is there that ethics training reduces the incidence of corruption?  These are questions that need to be answered. Some experts are not convinced.

“Certainly there is a place for ethics training, but it will not do the work of a reasonable set of internal controls, and everything is off the table without good leadership.”[11]

While it is difficult to mandate good leadership, spending more money on monitoring and enforcement would probably do more to change behavior than explaining rules to officials about things that they should not be doing in the first place.

Transparency and Open Data

One of the most efficient ways to deal with corruption is to require transparency and open data to the public.  This is increasingly less costly than it has been in the past as technologies have improved and prices have dropped. Nevertheless, the way that information is packaged can make it difficult for anyone outside agency staff to access information. One obstacle to searching ethics disclosures in Alabama is that there is no way to browse the records. One must know the name of a specific individual to find any document. One tried and true way to obscure access to information is to require requestors to know highly specific information to make the request.

Information systems that lock up data behind queries give the impression of releasing information but are actually obstacles to access to information. The ability to download entire databases of public records is the best practice in this regard. The Sunlight Foundation, a national, nonpartisan, nonprofit organization that advocates for open government, has published guidance on how to provide open access to government data, for better public engagement and access at https://opendatapolicyhub.sunlightfoundation.com/.  Policies developed with the Civic Commons provide additional guidance on good policies: http://wiki.civiccommons.org/Open_Data_Policy/.

A Systemic Response

Just as many symptoms can emerge from a single problem, often the right answer is not one thing, but many things. Unfortunately, when corruption is perceived as isolated and unique, the response is also isolated and unique. This is displayed during every legislative session as local acts  are passed to address matters that are truly statewide in scope.

For example, the response to Jefferson County’s sewer system debacle was addressed with a narrowly focused legal remedy specifically for Jefferson County, leaving the rest of the state unprotected from an identical scenario. The Jefferson County bankruptcy was an unnecessary opportunity for corruption on a grand scale – and one whose lessons have not been fully learned.

For the full PDF summary brief, click here. 

[1] 2018 Brewer Tolbert Award acceptance speech to the Alabama Appleseed Center for Law & Justice, September 20, 2018.

[2] Eugen Dimant and Guglielmo Tosato “Causes and Effects of Corruption: What has Past Decade’s Empirical Research Taught us? A Survey,” Journal of Economic Surveys, January 2017, p. 13.

[3] Crain, Trisha Powell, “Alabama K-12 education spending third worst catching up to recession cuts,” AL.com, Posted Dec 4, 2017 https://www.al.com/news/index.ssf/2017/12/alabama_k-12_education_spendin.html

[4] Quoctrung Bui, “The States That College Graduates Are Most Likely to Leave,” The New York Times, Nov. 22, 2016, https://www.nytimes.com/2016/11/22/upshot/the-states-that-college-graduates-are-most-likely-to-leave.html

[5] Brett Blackledge of The Birmingham (AL) News, http://www.pulitzer.org/winners/brett-blackledge; John Archibald of Alabama Media Group, Birmingham, Ala., http://www.pulitzer.org/winners/john-archibald-alabama-media-group

[6] For additional discussion of the methodology and rankings, see State Integrity Investigation 2012 at https://www.publicintegrity.org/accountability/state-integrity-investigation/state-integrity-2012; and State Integrity Investigation 2015 at https://www.publicintegrity.org/accountability/state-integrity-investigation/state-integrity-2015

[7] “Corruption Convictions Index,” Institute for Corruption Studies, http://greasethewheels.org/cci/

[8] It is worth noting that one governor’s conviction for corruption involved a board that issues certificates of need to hospitals, a practice that does not exist in 12 states, including large states like Texas and California. See “CON-Certificate of Need State Laws,” National Conference of State Legislatures. http://www.ncsl.org/research/health/con-certificate-of-need-state-laws.aspx

[9] Gao, Pengjie and Lee, Chang and Murphy, Dermot, Financing Dies in Darkness? The Impact of Newspaper Closures on Public Finance (August 10, 2018). Available at SSRN: https://ssrn.com/abstract=3175555 or http://dx.doi.org/10.2139/ssrn.3175555

[10] John Hudak and Grace Wallack. “Sometimes cutting budgets raise deficits: The curious case of inspectors’ general return on investment.” Center for Effective Public Management at Brookings, April 2015.  https://www.brookings.edu/wp-content/uploads/2016/06/CEPMHudakWallackOIG.pdf

[11] Mark Funkerhouser, “Why Ethics Training is a Waste.” August 9, 2012. http://www.governing.com/gov-institute/on-leadership/col-corruption-waste-abuse-ethics-training.html


Mental Health and Substance Abuse Ranks #4 Among Alabama Voter Priorities

In late 2017, the Public Affairs Research Council of Alabama (PARCA) surveyed Alabama voters to determine their thoughts about the general direction of the state and the issues that most concern them. PARCA partnered with Samford University to survey policy professionals from across the state including academics, journalists, business and nonprofit leaders, and lobbyists. Their responses provided a list of 17 critical issues facing Alabama. PARCA partnered with USA Polling at the University of South Alabama to ask registered voters about these 17 issues. The voters’ responses generated the Top Ten list of voter priorities. Details about the survey and its methodology can be found in the full Alabama Priorities report.

Alabama Priorities

1. K-12 Education
2. Healthcare
3. Government Corruption and Ethics
4. Mental Health and Substance Abuse
5. Poverty and Homelessness
6. Jobs and the Economy
7. Crime and Public Safety
8. Job Training and Workforce Development
9. Improving the State's Image
10. Tax Reform

Key Findings

  • Voters broadly agree on the critical issues facing the state.
  • Voters are not polarized along traditional political, ideological, racial, or generational lines. There is a significant gap between the priorities of experts and the priorities of voters.
  • Policymakers have an opportunity to inform and educate voters on critical and systemic challenges facing the state.
  • Policymakers have an opportunity to respond to immediate, often highly personal issues that concern voters.
  • Elected officials and candidates have an opportunity to show leadership and to build broad coalitions to address Alabama’s most pressing challenges.

This summer and fall, PARCA will produce summary briefs on each of the top ten priorities chosen by Alabama voters. Each brief will answer four critical questions: what is the issue, why it matters, how Alabama compares, and what options are available to Alabama policymakers.

#4: Mental Health and Substance Abuse

What is the issue?

Alabama voters rank mental health and substance abuse as the 4th most important issue facing Alabama, with 56% of respondents indicating they were very concerned about the issue. A plurality of Millennials and majority of voters of every other generation are very concerned about the issue. These findings are in keeping with the State’s Community Health Improvement plan, which found Alabamians rank mental health as the second greatest health concern.[1]

Mental illness includes a range of mental health conditions from mild anxiety, treatable with counseling, all the way to major psychiatric issues requiring psychotropic medication and long-term hospitalization.

An estimated 43.6 million Americans from all backgrounds suffer from mental illness or substance abuse. If current trends continue, by 2020, there will be more people suffering from mental and substance abuse disorders than people suffering from all physical diseases worldwide.[2]

Mental illness and substance abuse disorders share some underlying causes, including changes in brain composition, genetic vulnerabilities, and early exposure to stress or trauma.[3] Individuals that suffer from drug addiction frequently experience one or more symptoms of mental health issues.[4]

Experiencing both mental illness and substance abuse, what professionals call a dual-diagnosis, is very common.

Why Does it Matter?

Mental illness and substance abuse can alter reasoning skills, coping mechanisms, emotions, and behavior. This can have a profound impact on the individual and family, but also on the broader society.

Serious and untreated mental health concerns, including substance abuse, can place a strain on the communities by increasing unemployment, crime, and healthcare costs. Substance abuse alone has been estimated to cost $504 billion in direct and indirect costs, including lost productivity, in 2015 alone.[5]

Left untreated, mental health and substance abuse disorders can hinder an individual’s ability to live a healthy, confident life, and the ability to be productive members within the community. Untreated mental health and substance abuse issues can be significant contributing factors to job loss, homelessness, criminal behavior, and premature death. Suicide and drug-related deaths have increased in the nation in recent years with suicide ranked 11th in 2014 as the leading cause of death.[6]

More than one in four adults living with a severe mental health issue is also struggling with substance abuse issues. The effects on the communities can have direct and indirect consequences. “Direct consequences can include injuries, social and legal problems, impaired health, overdose, deaths, and babies born with neonatal abstinence syndrome. Indirect consequences include higher health care costs, the spread of infectious diseases, drug-related crime, interpersonal violence, unintended pregnancy, and stress within families.”[7]

How Does Alabama Compare?

Mental health care and substance abuse are critical issues in Alabama. In 2014, Mental Health America ranked the fifty states and Washington, D.C. in a number of mental health categories.[8] Overall, in the composite ranking of 15 mental health metrics, Alabama ranked 41st, ahead of neighboring states South Carolina, Tennessee, Mississippi, but behind North Carolina, Florida, Arkansas, and Louisiana. Georgia led all Southeast states at 26. Alabama ranked 27th in overall adult mental health and 28th in overall youth mental health. Looking at individual components, Alabama ranked:

  • 30th in the number of adults suffering from any mental illness;
  • 18th in the number of adults suffering from acute suicidal ideation;
  • 9th in the number of youth suffering from a major depressive episode in the previous year;
  • 42nd in the number of adults diagnosed with any mental illness without insurance, representing 20.8% of the adult population; and
  • 48th in overall access to care, ahead of only Texas, South Carolina, and Mississippi.

In spite of all this, less than half (43.5%) of adults in Alabama living with mental illness have received any form of treatment.[9]

Alabama now faces the daunting task of combating the opioid crisis. In 2013, Alabama had the highest per capita number of opioid prescriptions in the country – 141.1 per 100 compared to the national average of 79.3 per 100 people. Since then, the rate has dropped to 120.3 per 100 in 2015 – but this number still represents 1.2 prescriptions for every man, woman, and child in Alabama.[10]

While Alabama ranks 34th in deaths from drug overdose, the number of overdose deaths continue to climb: from 169 in 1999 to 756 in 2016, a 347% increase.[11]

Lack of accessible care and lack of sufficient insurance coverage for substance users exacerbates the issue. There is a high correlation between availability of preventative mental health services and mental health treatment. Alabamians have less access to mental health services than do residents of many other states.

What Can We Do?

Access to Care

One of the most significant factors facing mental health and addiction treatment in Alabama is simply the lack of access. Alabama has one mental health provider for every 1,180 people. Mental health providers include psychiatrists, psychologists, licensed clinical social workers, counselors, marriage and family therapists, and advanced practice nurses who specialize in mental health. However, at the county level, the ratio ranges from 270:1 (Macon County) to 33,840:1 (Chambers County).[12] Focusing on just substance abuse, statewide, there are 505 beds for residential and high-intensity residential substance abuse treatment – and these beds are located in just 13 counties. There is a waiting list of 319 people.

Individuals without insurance may wait for months to see a mental health professional. More often than not, this results in a crisis that ends with the individual in the hospital or jail. In effect, Alabama’s hospital emergency departments, jails, and prisons serve as de facto mental health providers. At the same time, while most people know how to access physical health care, people may be less familiar with when and how to access mental health care.

  • The state could expand Mental Health First Aid, described as ‘CPR’ for mental health, and Crisis Intervention Training for law enforcement personnel.
  • The state could also explore a waiver, which would allow Medicaid to fund treatment of substance abuse.
  • The state could explore expanding access to substance abuse treatment, particularly residential treatment. There are currently no substance abuse facilities, public or private, in Autauga, Bullock, Coosa, Lawrence, Lowndes, Perry, Washington, or Wilcox Counties.

Mental Health Workforce

Access is largely, but not exclusively, a function of size of the mental health workforce. Alabama faces a growing workforce shortage in many industries, including mental health services. There is a particular shortage for trained professionals serving the elderly. Unaddressed, this shortage will escalate as the senior population is growing faster than other age groups.

  • The state could explore incentives to attract and retain mental health professionals.
  • The state could explore licensure regulations to allow all medical professionals to practice at the highest levels of their training and certification.

Social Stigma

Mental health experts recognize that even if there were sufficient mental health providers, there is still a significant stigma attached to accessing treatment for mental health or substance abuse issues. Moreover, often when treatment is sought, the individual is already in a state of crisis, rather than seeking care earlier.

  • The state could seek to reduce the stigma by promoting and expanding peer programs—mental health services led by, or in conjunction with a person who has experienced mental illness himself or herself.
  • The state could develop an awareness campaign for the general public.

Standards of Care

There are a number of evidence-based and standards of care treatments that could be considered for expansion or modification in Alabama.

  • The use of medication to treat opioid addiction could be expanded.
  • The state could require healthcare professionals who prescribe medication treatment for addiction, do so only in consultation with a trained mental health professional.
  • The number of state-funded residential beds for substance abuse treatment could be expanded.
  • The number of nonprofit or low-cost methadone clinics for those with heroin addictions who suffer multiple relapses could be expanded.
  • The state could create a harm reduction program for opioid users, which includes education, counseling, referrals to treatment, and needle services and which has been shown to reduce the spread of HIV and Hepatitis C and increase the likelihood an individual will seek treatment.
  • The state could expand mental health and substance abuse treatment in the corrections system, which could also help reduce recidivism rates.

Drafted by Anita Perry, graduate student, Department of Social Work, Samford University, and the staff of the Public Affairs Research Council of Alabama.

Full PDF report available here.

[1] Alabama Department of Public Health, State of Alabama Community Health Improvement Plan (2015), http://www.adph.org/accreditation/assets/CHIP_2015_RevAugust.pdf.

[2] Rosenberg, L. 2012. “Behavioral disorders: the new public health crisis.Journal of Behavioral Health Services & Research 39(1):1-2.

[3]  U.S. Department of Health and Human Services, “Mental Health and Substance Use Disorders” (2017), https://www.mentalhealth.gov/what-to-look-for/mental-health-substance-use-disorders.

[4]  U.S. Department of Health and Human Services, “Mental Health and Substance Use Disorders” (2017), https://www.mentalhealth.gov/what-to-look-for/mental-health-substance-use-disorders.

[5] U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration, Facing Addiction in America: The Surgeon General’s Report on Opioids (2018), https://addiction.surgeongeneral.gov/sites/default/files/surgeon-generals-report.pdf.

[6] U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration, Facing Addiction in America: The Surgeon General’s Report on Opioids (2018), https://addiction.surgeongeneral.gov/sites/default/files/surgeon-generals-report.pdf.

[7] Walden, Nicole. “The Opioid Crisis in Alabama” Alabama Department of Mental Health, November 27, 2017, http://www.alabamapublichealth.gov/alphtn/assets/112717handouts.pdf.

[8] Mental Health America, “The State of Mental Health in America, 2018” (2018), http://www.mentalhealthamerica.net/issues/state-mental-health-america.

[9] U.S. Department of Health and Human Services, Substance Abuse and Mental Health Services Administration, Behavioral Health Barometer Alabama, 2015, (2015), https://www.samhsa.gov/data/sites/default/files/2015_Alabama_BHBarometer.pdf.

[10] National Institute on Drug Abuse, “Alabama Opioid Summary” (2018), https://www.drugabuse.gov/drugs-abuse/opioids/opioid-summaries-by-state/alabama-opioid-summary

[11] U.S. Department of Health and Human Services, Centers for Disease Control, “Drug Overdose Mortality by State: 2016” (2018), https://www.cdc.gov/nchs/pressroom/sosmap/drug_poisoning_mortality/drug_poisoning.htm

[12] Robert Wood Johnson, 2018 County Health Rankings, (2018), http://www.countyhealthrankings.org/app/alabama/2018/measure/factors/62/map


PARCA Annual Survey Addresses Representation in State Government, Public Education and Payday Loans

PARCA collaborated with Samford University to conduct our annual telephone survey of Alabama citizens between June 4 and July 18, 2018. The survey was directed by Dr. Randolph Horn and was under the field direction of Grace Okoro.

The survey addressed topics including the quality of representation in state government, and, in partnership with the Alabama Association of School Boards, questions about public education in Alabama, and, in partnership with the Community Foundation of Greater Birmingham, questions about payday loans.

Many trends remained the same from previous years, but some of the results were surprising.

Read the full report here. (PDF)


Crime and Public Safety Ranks #7 Among Alabama Voter Priorities

In late 2017, the Public Affairs Research Council of Alabama (PARCA) surveyed Alabama voters to determine their thoughts about the general direction of the state and the issues that most concern them. PARCA partnered with Samford University to survey policy professionals from across the state including academics, journalists, business and nonprofit leaders, and lobbyists. Their responses provided a list of 17 critical issues facing Alabama. PARCA partnered with USA Polling at the University of South Alabama to ask registered voters about these 17 issues. The voters’ responses generated the Top Ten list of voter priorities. Details about the survey and its methodology can be found in the full Alabama Priorities report.

Alabama Priorities

1. K-12 Education
2. Healthcare
3. Government Corruption and Ethics
4. Mental Health and Substance Abuse
5. Poverty and Homelessness
6. Jobs and the Economy
7. Crime and Public Safety
8. Job Training and Workforce Development
9. Improving the State's Image
10. Tax Reform

Key Findings

• Voters broadly agree on the critical issues facing the state.
• Voters are not polarized along traditional political, ideological, racial, or generational lines. There is a significant gap between the priorities of experts and the priorities of voters.
• Policymakers have an opportunity to inform and educate voters on critical and systemic challenges facing the state.
• Policymakers have an opportunity to respond to immediate, often highly personal issues that concern voters.
• Elected officials and candidates have an opportunity to show leadership and to build broad coalitions to address Alabama’s most pressing challenges.

In the following months, PARCA will produce summary briefs on each of the top ten priorities chosen by Alabama voters. Each brief will answer four critical questions: what is the issue, why it matters, how Alabama compares, and what options are available to Alabama policymakers.

#7: Crime and Public Safety

What is the Issue?

Alabama voters ranked crime and public safety as the 7th most important issue among the priorities, with approximately 58% of voters indicating they were very concerned about the issue. The issue averaged 4.10 on a 1 – 5 scale where 1 is “not at all concerned” and 5 is “very concerned.”

Majorities of every racial group are very concerned about this issue. Approximately three-quarters of African-Americans say they are very concerned. Respondents with lower incomes are more likely to say they are very concerned than respondents with higher incomes. While majorities of conservatives and liberals say they are very concerned, only a plurality (more than any other category but not a majority) of self-described moderates holds this view.

Survey respondents were also asked about their top policy responses to crime and public safety. Twenty-seven percent of voters were more concerned about the number of police, 24% civil liberties, and lesser percentages identifying sentencing reform and conditions of state prisons as their top priority.

Why Is Crime and Public Safety Important?

In previous generations, a basic high school education was sufficient for entry into the workforce. Today, an increasing share of entry-level jobs require a level of training beyond a high school diploma. To generate a prepared workforce, there is continued need to improve preparation for and access to two and four-year colleges. However, the demand for advanced training is also being addressed by K-12 schools, where students are increasingly presented with options for earning industry-recognized credentials while still in high school. Certificate programs are being expanded for new graduates and current workers.

Alabama has enjoyed an unprecedented run of industrial recruitment and new job creation. According to the Alabama Department of Commerce, the state has added or announced 138,197 new jobs between 2010 and 2017. In that same time, employment in Alabama has grown from 1,893,169 to 2,081,176 – an increase of 188,007, and the unemployment rate has fallen to 3.8% (December 2017). Recent monthly unemployment rates for the state have hovered between 3.7 and 4.1%, the lowest numbers since at least 1976. Despite the surging demand for labor, Alabama’s population growth has been sluggish, creating a tight labor market and a pending shortage of workers.

How Does Alabama Compare?

Crime has many negative impacts on a community.

Crime and the response to crime create a large economic and social cost, including the direct economic losses suffered by victims and the costs of police protection, legal services, and corrections.

Crime data and perceptions of public safety are widely used in quality of life rankings, which can impact the perceived livability and desirability of a community.[1]

High crime rates deter business. Crime can reduce the size and skills of the labor force. Crime can have a negative impact on education and training, diminishing the long-term creativity and innovative capacity of a community. Crime can deter business investment and location.

The economic, societal, familial, and personal costs of incarceration are immense.

Public safety plays a crucial role in supporting economic growth and vitality by reducing the cost of crime and enhancing the desirability of communities as places to live and locate businesses and has a direct impact on the levels of societal trust and interaction.[2]

How Does Alabama Compare?

The Crime Rate

Alabama reported 532.3[3] violent crimes per 100,000 residents in 2016, placing Alabama 8th highest in the nation for violent crimes. Alabama fared worse than most Southeastern states, except Tennessee, Louisiana and Arkansas. The state fared somewhat better in terms of property crimes, ranking 14th in the nation. Alabama’s property crime index for 2016 was 2,947.8 per 100,000 residents but was lower than that of only four Southeastern states. When violent and property crimes are considered together, Alabama ranked 9th in the nation with a crime index of 3,480.1 per 100,000 residents.

According to the Alabama Law Enforcement Agency’s annual crime report[4], total crime in the state has decreased from 2011 to 2015 but increased roughly 2% from 2015 to 2016.

However, during this same period, the number of violent crimes increased every year except between 2012 and 2014. Violent crime in the state increased from 405.5 per 100,000 residents in 2014 to 518.2 in 2016.

Although the number of violent crimes increased significantly over that two-year period, the number of crimes cleared has been decreasing.[5] In 2014, 45% of violent crimes were cleared, but that percentage decreased to 39% in 2016. The clearance rate for total crime in the state has also been declining over the same period.

The Incarceration Rate

In 2016, there were 27,799 inmates in Alabama prisons, a rate of 633 people per 100,000 – the 3rd highest incarceration rate in the U.S. The state’s incarceration rate is significantly higher than the national rate of 471 per 100,000 residents and lower than only Oklahoma and Louisiana; 700 and 816 per 100,000 residents, respectively.

The high number of incarcerations makes the state’s prisons the most overcrowded in the country; housing almost twice the number of inmates the facilities were designed to house.

In addition to a high incarceration rate, the ratio of supervising probation and parole officers to probationers, parolees, and offenders poses a significant problem for the state’s system. At the end of fiscal year 2017, the total caseload average per officer on any given day was measured at 169 to 1. When broken down by total and active caseloads, the active caseload average per officer was 110 to 1. The American Probation and Parole Association (APPA) recommended caseload is 20 probationers per probation officer for intensive supervision, 50 to 1 for moderate to high-risk offenders, and 200 to 1 for low-risk offenders.

The Recidivism Rate

Recidivism, which refers to a person’s relapse into criminal behavior and is measured by criminal acts that result in rearrests, reconviction, or return to prison within three years, is a major driver of incarceration rates.

In 2017, the recidivism rate in Alabama was 31.5%, including all cohorts.[6] The high percent of recidivists continues to negatively impact the state’s prison system which is already overburdened. It also sheds light on the need for more effective programs to help released prisoners readjust to their communities and rebuild their lives.

Juvenile Detention

The percentage of violent crimes and property crimes committed by juveniles in Alabama decreased since 2013. As of 2016, juveniles account for 6% of violent crimes and property crimes.

Despite the decline in juvenile crime, the number of detained juveniles is also a cause for concern. Alabama’s juvenile custody rate of 184 per 100,000 youths places the state 20th in the nation. When compared to Southeastern states, the state ranked 3rd with only Arkansas and Virginia having higher rates.

There is a long-term impact on juveniles with criminal convictions that goes beyond the immediate effect to individual and family. A study from University of Pittsburgh found that 52% to 57% of juvenile delinquents continue to offend up to the age of 25, and about 16 – 19% up to the age of 30.[7]

Funding

Like many parts of state government, Alabama’s corrections and justice systems struggle with funding. Alabama spends less on corrections than a majority of states across the country.

According to the Alabama Department of Corrections 2017 Annual Report, Alabama spent $52.07 per day per inmate, compared to the national average of $99.45.

Alabama’s low per inmate spending may be seen as a positive by some. However, it is important to remember that with this level of spending comes a Department of Corrections that is understaffed, pays the lowest of any public safety agency in the state, and which suffers from very high turnover rates. The state’s corrections spending also contributes to legal issues facing the state. Alabama is currently engaged in two different lawsuits concerning the healthcare and conditions of Alabama’s prisons. It is highly likely that the outcome of these cases will result in court-mandated increases in Alabama’s corrections budget.

Beyond funding Alabama’s prison system, Alabama’s funding for judicial, legal and police protection is also low. Based on 2016 expenditure data from the Bureau of Justice Statistics, Alabama’s justice system expenditures, which include police protection, judicial and legal, and corrections, were low when compared to more than 30 states across the country and most Southeastern states. In 2016, the state spent $2.5 billion, while other southeastern states spent a significantly higher amount (example Florida’s 2016 expenditures totaled roughly $14 billion and Georgia approximately $6 billion).

What Can We Do?

The state has made recent attempts to address overcrowding in prisons, the high rate of supervision caseloads, and the lack of treatment in the community. In 2015, the state passed the Justice Reinvestment Act (Act 2015-185), which strengthened community-based supervision as an alternative to prison, while prioritizing prison space for violent and dangerous offenders. The legislation also took steps to ensure supervision for everyone upon release from prison. Since then, the state’s prison population has decreased by 15%, and more than 100 new probation and parole officers have been hired to help reduce officers’ caseloads.

In June 2018, the Alabama Department of Corrections announced pay raises of 5% for correctional officers at medium security facilities and 10% for officers at maximum security facilities.

Further reductions of the inmate population will be challenging, and additional investment in the prison system will be fiscally and politically difficult – although court orders may leave the state with no choice.

There are additional options the state can explore, including:

  • Continued expansion of day reporting facilities[8] and related programs designed to reduce recidivism;
  • Explore recommendations of the Alabama Juvenile Justice Task Force[9] designed to reform the retention of juvenile offenders; and
  • Expand mental health and drug treatment options both inside state prisons and in local communities.

 

Drafted by Kenesha Reynolds-Allie, Ph.D. and the Staff of the Public Affairs Research Council of Alabama

View the full PDF report here.


[1] Blair, J.P., “Quality of life and economic development policy”, Economic Development Review 16, 1998.

[2] Keeling, Mary and Mark Cleverly, “Accelerating economic growth and vitality through smarter public safety management”, IBM Institute for Business Value, Executive Report.

[3] Crime index (violent and property crimes) was calculated using 2016 Crime in the United States (CIUS) data from the Federal Bureau of Investigation (FBI) Uniform Crime Reporting (https://ucr.fbi.gov/crime-in-the-u.s)  and 2016 population estimates from the U.S. Census Bureau, Population Division (https://www.factfinder.census.gov)

[4] http://www.alea.gov/Home/wfContent.aspx?PLH1=plhACJIC-CrimeInAlabama

[5] A clearance is a measure of law enforcement activity whereby enough evidence is found to charge a suspect and take him into custody (an arrest) or when a crime is solved but no formal charges are brought against a suspect (clearance by exceptional means).

[6] Alabama Department of Corrections – FY2017 Annual Report (http://www.doc.state.al.us/StatReports)

[7] Stouthamer-Loeber, Magda, “Persistence and Desistance in Offending” (unpolished report, Pittsburg, Pa.: Life History Research Program, University of Pittsburg, 2010).

[8] Board of Pardons and Paroles, 2017 Annual Report http://www.pardons.state.al.us/Reports.aspx

[9] Alabama Juvenile Justice Task Force Final Report, December 2017. http://dys.alabama.gov/images/task_force/AL%20JJ%20Task%20Force%20Report_FINAL.pdf


PARCA Wins National Award for Research on Regional Cooperation

The Public Affairs Research Council of Alabama’s research report Together We Can: Charting a Course to Cooperation for Greater Birmingham received national recognition by the Governmental Research Association (GRA) at the GRA’s annual conference in Detroit last week.

PARCA received the GRA award for “Most Distinguished Research” on a regional government issue for its ongoing work to examine the current structure of government in Greater Birmingham, with Jefferson County as its primary focus. The study sought to answer three questions. Is the region fragmented? If yes, does fragmentation produce negative consequences? If yes, are there viable options to reduce fragmentation and increase regional cooperation? In all three questions, we found the answer to be yes.

Together We Can was commissioned by the Community Foundation of Greater Birmingham in conjunction with their ongoing project Together We Prosper, a campaign to get the people of the Birmingham metro area talking about how we can work together better to help our entire community prosper and compete in a global economy.

The award was given based on several criteria, including the use of new and/or innovative research methods, or new and/or innovative uses of existing methods; usefulness of the study to other states and/or municipalities; and, whether or not the subject is one of critical national, regional, or local concern or costs.

This is the 11th national award that PARCA has received from the GRA, which was founded in 1914 as the national organization of individuals involved in government research. GRA’s annual awards competition is conducted to “recognize exceptional individuals involved in government research.”


The State’s Image Ranks #9 among Alabama Voter Priorities

In late 2017, the Public Affairs Research Council of Alabama (PARCA) surveyed Alabama voters to determine their thoughts about the general direction of the state and the issues that most concern them. PARCA partnered with Samford University to survey policy professionals from across the state including academics, journalists, business and nonprofit leaders, and lobbyists. Their responses provided a list of 17 critical issues facing Alabama. PARCA partnered with USA Polling at the University of South Alabama to ask registered voters about these 17 issues. The voters’ responses generated the Top Ten list of voter priorities. Details about the survey and its methodology can be found in the full Alabama Priorities report at www.parcalabama.org

Alabama Priorities

1. K-12 Education
2. Healthcare
3. Government Corruption and Ethics
4. Mental Health and Substance Abuse
5. Poverty and Homelessness
6. Jobs and the Economy
7. Crime and Public Safety
8. Job Training and Workforce Development
9. Improving the State's Image
10. Tax Reform


Key Findings

Voters broadly agree on the critical issues facing the state.

Voters are not polarized along traditional political, ideological, racial, or generational lines. There is a significant gap between the priorities of experts and the priorities of voters.

Policymakers have an opportunity to inform and educate voters on critical and systemic challenges facing the state.

Policymakers have an opportunity to respond to immediate, often highly personal issues that concern voters.

Elected officials and candidates have an opportunity to show leadership and to build broad coalitions to address Alabama’s most pressing challenges.

In the following months, PARCA will produce summary briefs on each of the top ten priorities chosen by Alabama voters. Each brief will answer four critical questions: what is the issue, why it matters, how Alabama compares, and what options are available to Alabama policymakers.

#9: The State’s Image

What is the Issue?

The state’s image is the 9th most important issue for Alabama voters, with 57% of survey respondents indicating they are very concerned about improving the state’s image.

When examining the top ten priorities by population, the state’s image made the top ten for most groups. Interestingly, the issue ranked higher for older voters and for those with lower incomes and levels of education.

Some would say that Alabama’s image is well earned. Alabama ranks poorly compared to other states in many measures of corruption, education, health, income, and general well-being – issues that will be explored more fully in future briefs.

The State’s Image by Group – asterisks (*) indicates the issue did not rank in the top ten

Alabamians are reminded of this fact frequently. Every few days there is a story in the media highlighting how Alabama compares to other states on some measure. A simple web search generates many such rankings – some concerning more substantive issues than others and some rankings compiled with more rigor than others. In just the last few weeks, Alabama has been ranked as:

  • 42nd in child-well being[1]
  • schools rank 42nd in the nation[2]
  • #3 in speed-related deaths[3]
  • #1 for fast-food restaurants per capita[4]
  • 41st in places to start a business[5]
  • 40th in children’s health[6]
  • 49th in hiring people with disabilities[7]

Rankings such as these do not tell the whole story, but as has been said, perception is reality.

Why is the State’s Image Important?

Perception

Alabama, like other southern states, labors under stereotypical and outdated assumptions about the rural south: remote, uneducated, and uncivilized. This narrative continues to be nurtured in popular culture and, sometimes by the state and its people. Alabamians, however, and those that visit, know that these descriptions do not reflect the state.

Fairly or not, Alabama must contend with its reputation when attracting new industry and new investment to Alabama. At the same time, the state has been relatively successful on this front in recent years, suggesting that perceptions can be challenged.

Economic developers know that quality of life is fast becoming one of the most important factors businesses consider when choosing a new location. When recruiting a new industry or a new employee, business leaders in Alabama often say, ‘if we can get them to visit, we can get them to stay.’

Reality

At the same time, while some aspects of the state’s image might be misguided or stereotypical, other aspects are based in reality. On average, Alabama students do lag behind their peers in most states. On average, Alabamians are more unhealthy than residents in many other states. Alabama’s median income is in the bottom five in the country, and the state’s recovery from the Great Recession has been slower than many other states.

These are real issues affecting real people, every day – regardless of the state’s reputation.

As noted, the state’s image emerged as a higher priority for voters with lower levels of income and education. The issue also ranked higher for voters generally (9th) than for policy professionals (16th). This could be because policy professionals believe that the best way to change the state’s image is indirectly, by addressing the individual factors that create the image. They are not wrong.

However, that the issue ranks so highly for voters underscores the extent to which voters believe the state’s image affects them personally. We suggest that people with more resources – more education, skills, and income – are held less captive by the state’s reputation. They also have more ability to relocate to other parts of the state or to leave the state altogether to seek other opportunities. Conversely, those with fewer resources – less education, skills, and income – may be, or feel, stuck. In other words, their prospects and those of their families may be more intimately tied with those of the state, their county, and their town.

How Does Alabama Compare?

Rather than attempting to measure Alabama’s image compared to other states, we look at three indicators as proxies: job creation, economic growth, and population. These metrics do not constitute image – but we suggest that the same factors that drive these metrics also drive the larger concept of image.

Job Creation

According to the Alabama Department of Commerce, the state has added or announced 138,197 new jobs and $35.2 billion in investment between 2010 and 2017. This suggests Alabama is increasingly attractive to business. However, as with many issues, the distribution of new jobs is not equal. In 2017, 19 counties reported zero jobs from new industry and three counties reported no new jobs from industry expansion.

Economic Growth

The effects of job growth – and decreasing unemployment – are beginning to show in the state’s GDP. Alabama experienced 3.3% growth between 2016 and 2017, outpacing recent trends, but below its southeastern neighbors. For the period 2010 to 2017, Alabama’s compounded annual growth rate is estimated at 2.7%, lower than every other southern state except Mississippi and Louisiana – and far behind regional leaders Tennessee (4.6%), Georgia (4.3%), and South Carolina (4.2%).

Population

The state may be adding jobs and seeing a positive trend in GDP, but these trends are not correlating to population growth. The state’s image surely plays a large role in people’s decisions to move to, or remain in, Alabama – and in recent years, Alabama has struggled to compete with surrounding states.

Between 2010 and 2017, the population of southern states has grown an average of 5.6%. Florida leads the pack at 11.6%. More comparable to Alabama however, are South Carolina, North Carolina, and Georgia. These states have grown 8.6%, 7.7%, and 7.6% respectively.

Comparatively, in this same period, Alabama grew at 2.0%. This translates to a net population increase of 95,000 people in seven years – compared to an increase of 398,988 in South Carolina – a state that was approximately the same size as Alabama in 2010.

Moreover, the source of our population growth is telling. In the past seven years, Alabama has added population through natural growth (number of births minus number of death) and international migration. Alabama’s rate of international in-migration is much slower than most states, and its rate of domestic migration is lower than most other Southeastern states. Domestic migration – people moving from other states to Alabama – has accounted for a net increase of 1,153 people – less than 1% of the state’s population growth since 2010.

Alabama is adding jobs – but not people.  Alabama did see a larger year-over-year population increase in 2017. Perhaps this is the beginning of a new trend.

What Can We Do?

What, then, does this suggest for policy makers?

We suggest that policy makers recognize and prioritize the issues that give rise to a negative reputation. They have a real and profound impact on real people’s lives. As Alabama finds and implements effective responses to education, healthcare, jobs and the economy, crime and more – the state’s image will improve. More importantly, the lives of Alabamians will improve.

At the same time, leaders have an opportunity to remind Alabamians, and a larger national and international audience, of a broader story.

Alabama is emerging as a leader in advanced manufacturing and enjoys a growing reputation in research and innovation, as well as arts, culture, and cuisine.

Successes such as these should be celebrated. At the same time, the state’s challenges should be addressed in a straightforward manner, with an inclusive, broad-based program for expanding opportunity for all.

For the PDF version of the State’s Image summary brief, click here.

1] http://www.gadsdentimes.com/news/20180729/alabama-ranks-42nd-in-child-well-being

[2] http://www.waaytv.com/content/news/New-study-Alabama–489500431.html

[3] http://www.waff.com/story/38728591/alabama-ranks-no-3-in-speed-related-deaths

[4] https://whnt.com/2018/07/03/alabama-ranks-number-one-for-the-most-fast-food-restaurants-per-capita/

[5] https://www.bizjournals.com/birmingham/news/2018/07/02/alabama-ranks-low-for-best-places-to-start-a.html

[6] https://www.bizjournals.com/birmingham/news/2018/04/26/alabama-ranks-near-bottom-for-childrens-health.html

[7] https://www.al.com/business/index.ssf/2018/03/alabama_ranks_49th_among_state.html


Tax Reform Ranks #10 Among Alabama Voter Priorities

Background

In late 2017, the Public Affairs Research Council of Alabama (PARCA) surveyed Alabama voters to determine their thoughts about the general direction of the state and the issues that most concern them. PARCA partnered with Samford University to survey policy professionals from across the state, including academics, journalists, business and nonprofit leaders, and lobbyists. Their responses provided a list of 17 critical issues facing Alabama. PARCA partnered with USA Polling at the University of South Alabama to ask registered voters about these 17 issues. The voters’ responses generated the Top Ten list of voter priorities. Details about the survey and its methodology can be found in the full Alabama Priorities report.

Key Findings

Voters broadly agree on the critical issues facing the state.

Voters are not polarized along traditional political, ideological, racial or generational lines. There is a significant gap between the priorities of experts and the priorities of voters.

Policymakers have an opportunity to inform and educate voters on critical and systemic challenges facing the state.

Policymakers have an opportunity to respond to immediate, often highly personal issues that concern voters.

Elected officials and candidates have an opportunity to show leadership and to build broad coalitions to address Alabama’s most pressing challenges.

In the following months, PARCA will produce summary briefs on each of the top ten priorities chosen by Alabama voters, starting with #10. Each brief will answer four critical questions: what is the issue, why it matters, how Alabama compares, and what options are available to Alabama policymakers.

#10: Tax Reform

What is the Issue?

Tax reform is the 10th most important issue for Alabama voters, with 47% of voters indicating they were very concerned about the issue. Tax reform averaged 3.89 on 1 – 5 scale where 1 is “not at all concerned” and 5 is “very concerned.”

That voters are concerned about taxes and tax reform should come as no surprise. That the issue ranks tenth, however, is unexpected. The survey did not ask the direction or nature of tax reform. Certainly, voters and policymakers have differing concerns about Alabama’s tax policy. Taxes could be too high, too low, insufficient, or unfair. Recent research suggests that all of these can be true at the same time.

  • Taxes can be high – Alabama’s sales tax rates are among the highest in the country.
  • Taxes can be low – Alabama collects the lowest amount of property tax revenue per capita in the nation. The per capita collections could be doubled, and they would still be below the national average. Alabama per capita personal income tax collections are also lower than the national average.
  • Taxes can be insufficient – Alabama’s state and local governments collect less in taxes than state and local governments in any other state in the union. That means governments here have less money to spend to provide similar levels of service.
  • Taxes can be unfair – Taxes are not low for everyone. Because of the imbalance in the tax structure, taxes fall more heavily on some groups than others. Alabama’s tax system is the 12th most regressive state and local tax system in the nation,[1] meaning the poor pay a greater share of their income in taxes than the wealthy.

Why Is Tax Reform Important?

Public services in the United States, things like education, roads, and prisons, are generally funded through a mix of taxes and fees assed to all taxpayers. The structure of the federal system and the fifty state systems are complicated and the subject of ongoing debate. Voters and policymakers can and do argue over the details of the tax structure. However, there ought to be broad agreement on two fronts.

First, the tax system should generate revenue sufficient to meet the needs and demands of the public. The Alabama Priorities Project and other PARCA research suggest that many Alabamians do not believe that Alabama spends enough on public services.

Second, public revenues should be reasonably stable from year to year. However, Alabama has relied on one-time sources of revenue or unexpected windfalls to balance its books in each of the past five years. The 2017 Interim Report of the Legislature’s Joint Task Force on Budget Reform:

Year after year, session after session, the Alabama Legislature returns to Montgomery to answer the same, age-old question: “What are we going to do to fill the hole in the General Fund Budget?”  Certainly, there have been times over the years that this was not the case, but for the most part this question has been asked annually for decades.[2]

In attempting to achieve sufficiency and stability, voters and policymakers wrestle with three basic questions: Fairness – does the tax burden fall fairly across all taxpayers?; Adequacy – is tax revenue sufficient to meet the needs of modern life?; and Efficiency – Is the tax relatively easy to collect or does it place too great a burden on government or taxpayers? Jim Williams, retired PARCA Executive Director, notes “Tax problems are present in all states, but in Alabama the failure to create a fair, adequate, and efficient system of taxing and budgeting has led to what is in effect a perpetual budget crisis.”[3]

How Do Alabama Taxes Compare?

In PARCA’s 2017 report, How Alabama Taxes Compare, we reported that Alabama’s state and local governments collect less in taxes than state and local governments in any other state in the union.

In 2015, Alabama state and local governments collected a total of $15 billion in taxes, or $3,144 per resident.  Across the U.S., the median value for state and local taxes per capita was $4,379.

The median state had a per capita tax advantage of $1,235 over Alabama. In other words, if Alabama collected taxes at the per capita rate of the median state, local and state governments here would have an additional $6 billion to spend building and maintaining roads; providing police and fire protection; operating civil and criminal courts; supporting schools and colleges; libraries and parks; and the myriad of other functions government performs.

National comparisons are not always convincing because of regional economic differences, but Alabama stands out even in the Southeast. The figure below presents two sets of calculations. On the left, the Southeastern states are compared and ranked on their total state and local tax collections divided by their populations, producing a total for tax collections per capita. The chart on the right shows the per capita tax advantage of other Southeastern states over Alabama.

Alabama ranks at the bottom. The state closest to Alabama in terms of per capita tax collections is Tennessee, which collects $126 dollars more per resident than Alabama. The top Southeastern state in terms of taxes per capita is Louisiana, which collects $809 more per resident than Alabama.

As a bottom line, Alabama governments have less tax money available to pay for those services.

However, this is not widely understood. PARCA’s 2017 public opinion poll revealed that 34% of voters believe they pay about the same in taxes as those in neighboring states and 29% believe they pay more than residents of other states pay.

What Can We Do?

Voter concern about Alabama’s tax system or doubts about its adequacy and fairness can be troubling to policymakers at every level. Alabama has two sets of options: piecemeal refinements or broad-based reform.

Piecemeal Refinements

State and local governments could adjust sales tax rates. Decreasing rates will further reduce revenue. Increasing rates will make the tax system more regressive and could have diminishing returns. Sales taxes can also be very volatile. Tax collections increase and decrease as retail sales increase and decrease. This makes revenue unstable in volatile times and disastrous in periods of significant economic downturn. Moreover, changing consumer habits affect sales tax revenue. As more and more commerce shifts online, state and local tax collections are impacted.

State and local governments could expand the number of services that are taxed. Alabama applies its tax to almost all sales of goods, but it does not apply the tax to most kinds of business, professional, computer, personal, and repair services. In recent decades a greater share of economic activity has shifted toward consumption of such services. Alabama taxes 22% of services – the average state taxes 55% of services[4].

The state could increase and stabilize revenue through increases to property taxes. Property taxes are hard to change in Alabama. Caps on property taxes have been placed in the Alabama constitution, and any change to property tax rates requires approval not just from the Legislature, but also by a vote of the people.

Broad Based Reform

Since 1991, three major tax reform proposals have been developed (The Alabama Commission on Tax and Fiscal Policy Reform in 1991, The Tax Reform Task Force in 1992, and Governor Riley’s Accountability and Tax Reform Plan in 2003). As Jim Williams notes, “Experience has shown that Alabama voters are unlikely to favor a comprehensive reform package.”[5] However, while none of the major reforms were initially adopted, in the years since, a number of measures tracking or closely related to those systematic reform proposals have been adopted.

Moving Forward

Alabama’s tax system is not balanced. Policymakers can improve voters’ confidence in the tax system and stabilize revenue by seeking a better balance of taxes on income, property, and transactions – what we earn, own, and buy.

View the printable PDF brief here.

[1] Davis, C., Davis, K., Gardner, M., Heimovitz, H., Johnson, S., McIntyre, R. S., . . . Wiehe, M. (2015, January). Who Pays? 5th Edition: Alabama. Retrieved November 30, 2017, from https://itep.org/whopays/alabama/

[2]Alabama Legislature. (2017, May, p. 1). Interim Report from the Joint Task Force on Budget Reform.

[3] Williams, Jim (2017, Nov.) “Insights from Previous Attempts at Tax and Budget Reform in Alabama”

[4] Minnick, R. (2008, July. Revised 2010). Sales Taxation of Services, Retrieved November 20, 2017, from https://www.taxadmin.org/sales-taxation-of-services

[5] Williams, Jim (2017, Nov.) “Insights from Previous Attempts at Tax and Budget Reform in Alabama”


The Priorities of Alabama Voters

In 2018, Alabamians will elect a governor and five other statewide executive branch officers, 140 legislators, and scores of local officials. Those elected will lead Alabama for the next four years. These leaders should be responsive to the concerns of those they represent but also willing to help citizens understand critical, but perhaps less obvious, public policy issues. Such leadership requires understanding what issues most concern voters and what issues voters may not fully appreciate.

In this election year, PARCA surveyed Alabama voters to determine their thoughts about the general direction of the state and the issues that most concern them. We found broad agreement on the critical issues facing the state. Based on voter response, PARCA identified and ranked voters’ top 10 critical issues. Alabama Priorities explores this issue.

The Priorities

Alabama voters are eager to see improvement in K – 12 education, with 70% indicating they are very concerned about the state’s education system. Voters are worried about healthcare , particularly access and cost. With the recent resignations of a Governor, a Speaker of the House, and a state Supreme Court Justice, it should come as no surprise that voters are concerned about corruption and ethics. For many voters, mental health and substance abuse are not just theoretical problems—56% of Alabamians indicate they are very concerned about the issue. The poor and homeless have not been forgotten.

These issues, along with jobs and the economy, crime and public safety, job training and work force development, the state’s image, and tax reform comprise the top 10 list of Alabama’s priorities.

Perhaps this list should not come as a surprise. Previous polling by PARCA and other organizations have found similar results.

What is perhaps more surprising, however, is the extent to which these are shared priorities. We found few significant differences between Republicans and Democrats, liberals and conservatives, blacks and whites, or other groups. While differences exist, Alabama voters are not polarized.

Alabama Priorities

1. K-12 Education
2. Healthcare
3. Government Corruption and Ethics
4. Mental Health and Substance Abuse
5. Poverty and Homelessness
6. Jobs and the Economy
7. Crime and Public Safety
8. Job Training and Workforce Development
9. Improving the State's Image
10. Tax Reform

Experts and Voters: Differing Priorities

At the same time, while the data suggests broad agreement among voters, there is an area where significant gaps exist. PARCA surveyed business, civic, and nonprofit leaders, journalists, and academics. The differences between the priorities of these experts and voters were noticeable.

Four top 10 issues for voters fell outside the top 10 for experts:

  • Mental health and substance abuse
  • Poverty and homelessness
  • Job training and workforce development
  • Improving the state’s image

Conversely, experts identified four issues that did not register high on voters’ list of concerns:

  • Infrastructure and transportation
  • Prison and sentencing reform
  • Funding state government
  • Civil rights

Possible explanations as to why some issues are more important to voters and others more important to experts are offered in the “Differences Between Experts and Voters” section of the report. three implications are suggested.

Implications

The data suggest four implications.

  1. Voters are not polarized along traditional political, ideological, racial or generational lines.
  2. There is a significant gap between the priorities of experts and the priorities of voters.
  3. Policymakers have a two-fold opportunity to inform and educate voters on critical and systemic challenges facing the state.
  4. Policymakers have an opportunity to respond to immediate, often highly personal issues that concern voters.

This research suggests that elected officials and candidates have an opportunity to show leadership and to build broad coalitions to address Alabama’s most pressing challenges.

Read the full report here.