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February 20, 2009   Email to Friend 

Public hearing held on telephone deregulation bill

Alabama’s three Public Service Commissioners and Attorney General Troy King were among those who testified Thursday at a public hearing on a bill that would deregulate basic telephone service in the state.

SB 373, sponsored by Sen. Rodger Smitherman, D-Birmingham, would further limit the jurisdiction of the Public Service Commission over residential telephone service; delete its jurisdiction over business service; and specify that voice over Internet protocol (VoIP) would not be regulated by the Commission.

The bill has won support by some interest groups because it also would provide “lifeline” telephone service for low-income residents.

The companion bill, HB 478, is sponsored by Rep. Marcel Black, D-Tuscumbia.

During the hearing by the Senate Commerce, Transportation and Utilities Committee, PSC President Lucy Baxley and Commissioners Jan Cook and Susan Parker expressed concerns that the bill could reduce the availability of affordable telephone service, especially in rural areas.

The Alabama Farmers Federation’s utility rate consultant, Yvette Smiley-Smith, was scheduled to testify, but time constraints prevented the committee from hearing from everyone. Sen. Quinton Ross, D-Montgomery, who chairs the committee, pledged to let Smiley-Smith and others comment on the bill next week, prior to the vote.

Currently, AT&T charges a flat rate of $16.95 per month statewide for basic telephone service. As written, the bill would remove restrictions on residential telephone rate increases and could allow telephone companies to charge customers significantly more in rural areas where service is less concentrated.

The Federation encourages leaders to contact their legislators this week and share their concerns about the availability of affordable phone service in rural areas. Members of the Senate Commerce, Transportation and Utilities Committee are: Ross; Sen. Lowell Barron, D-Fyffe; Sen. Roger Bedford, D-Russellville; Sen. Charles Bishop, R-Jasper; Sen. Linda Coleman, D-Birmingham; Sen. Rusty Glover, R-Semmes; Sen. Hinton Mitchem, D-Union Grove; Sen. Jim Preuitt, D-Talladega; Sen. Hank Sanders, D-Selma; Sen. Harri Anne Smith, R-Slocomb; Sen. Wendell Mitchell, D-Luverne; Sen. Zeb. Little, D-Cullman; and Sen. Jabo Waggoner, R-Vestavia Hills.

In 2005, telephone services were partially deregulated to allow telephone companies to compete for bundled services such as cable and Internet. AFF opposes as written.

Food sales tax bill passed by Senate committee

The Senate Finance and Taxation-Education Committee passed a bill Wednesday that would eliminate the 4 percent state sales tax on food.

SB 115, sponsored by Sen. Hank Sanders, D-Selma, would offset the lost revenue by reducing or removing the state income tax deduction for federal income taxes paid. A similar bill, HB 116, sponsored by Rep. John Knight, D-Montgomery, awaits action in the full House.

Wednesday’s Senate committee vote of 9-3 was along party lines. Proponents of the bill told reporters they need to gain the support of at least some Senate Republicans if the measure is to stand a chance of passing.

Eliminating the state sales tax on food would cost an estimated $364 million a year, but the proposed income tax changes would generate about $380 million.

Sanders' bill would allow individuals making less than $100,000 annually and couples making less than $200,000 to keep the deduction for federal income taxes paid. The deduction would be gradually phased out for single filers making between $100,000 and $200,000 and couples making between $200,000 and $400,000. Individuals making more than $200,000 and couples making more than $400,000 would get no deduction.

If approved by the Legislature, the plan would go before voters as a proposed constitutional amendment in November 2010.

A similar bill was introduced last year, but failed due to opposition to the removal of the federal income tax deduction. The bill was amended this year to stagger the level of the deduction based on adjusted gross income.

AFF supports lowering the tax on food but opposes raising taxes on income.

Public hearing set for catfish labeling bill

The House Agriculture and Forestry Committee will hold a public hearing Wednesday on a bill that would require restaurants to disclose the country of origin of catfish served to customers.

HB 473, sponsored by Rep. A.J. McCampbell, D-Demopolis, would define the term “catfish” and would require food service establishments to comply with country-of-origin labeling requirements by providing the required information on a menu, placard or other written material.

The hearing will be Wednesday at 1:30 p.m. in Room 603 of the State House.

A new survey of Alabama residents shows 97 percent of respondents believe Alabama restaurants should be required by state law to inform consumers if they are served imported catfish. Moreover, 95 percent of survey respondents said restaurants should be made to follow the same strict federal labeling laws governing grocery stores.

“State-mandated catfish labeling legislation would not only help ensure the safety of our consumers, which is paramount, but it would also help ensure the livelihood of the thousands of residents employed by the Alabama catfish industry,” McCampbell said in a news release about the survey.

Alabama Farmers Federation Catfish Division Director Mitt Walker said the survey proves what producers have claimed for some time – consumers want to know where their food comes from and, if given the choice, will select food produced by U.S. farmers.

“Alabama is the second-largest producer of U.S. Farm-Raised Catfish,” said Walker. “Sixty-three percent of our state’s consumers eat some or most of their catfish in restaurants, according to our research. That means most consumers have no way of knowing where the catfish they eat is produced.”

McCampbell’s bill faces opposition led by the Alabama Retail Association. Federation members are encouraged to contact their legislators and ask them to support country-of-origin labeling for catfish served in restaurants. AFF supports.

Cockfighting bill carried over in House committee

A bill that would make it a Class C felony for a person to own, possess, keep, raise or train a rooster that could be used in cockfighting was carried over Wednesday in the House Agriculture and Forestry Committee.

HB 245, sponsored by Rep. Cam Ward, R-Alabaster, and a companion bill, SB 146>, sponsored by Sen. Hinton Mitchem, D-Union Grove, are supported by the Humane Society of the United States (HSUS), which operates no humane shelters but has amassed millions of dollars to wage campaigns against animal agriculture in states like Florida, Arizona and California.

The Alabama Farmers Federation has expressed concerns about the bill because it could give animal rights groups the authority to confiscate animals and make decisions about the disposition of those animals. The Federation has proposed changes to the bill that would allow fines for cockfighting to be increased while protecting poultry production in the state. These changes include the registration of backyard flocks with the Commissioner of Agriculture, which would provide for continued monitoring of avian diseases.

AFF opposes HB 245 and SB 146 as written, but does not support cockfighting.

Bills introduced affecting insurance in coastal areas

More than a half-dozen bills have been introduced in the Legislature related to the availability and cost of homeowners insurance in coastal areas.

SB 1 and HB 540, sponsored by Sen. Ben Brooks, R-Mobile, and Rep. Spencer Collier, R-Irvington, would provide insurance credits for homeowners who build a new home, rebuild a damaged or destroyed home, or retrofit an existing home to be resistant to severe weather. AFF has offered the sponsors a substitute, which further defines the building standards.

SB 7 and HB 541, sponsored by Brooks and Rep. Joe Faust, R-Fairhope, would allow homeowners to establish catastrophe savings accounts to cover insurance deductibles and other uninsured portions of risk associated with a catastrophic windstorm. This bill would allow taxpayers to claim credits against their state income tax for deposits made into the catastrophe savings account. AFF neutral.

SB 182 and HB 541, sponsored by Brooks and Rep. Randy Davis, R-Daphne, changes the requirements for insurance companies participating in the Alabama Insurance Underwriting Association or “beach pool.” It would require insurance companies to assume more risk on the beach or near the beach. This “zone-by-zone” approach could result in a net loss of policies in the north end of Baldwin and Mobile counties. AFF opposes.

SB 191 and HB 542, sponsored by Brooks and Rep. Steve McMillan, R-Bay Minette, would prohibit the application of a hurricane deductible for property damage not associated with a named tropical storm or hurricane. AFF neutral.

SB 410, sponsored by Sen. Trip Pittman, R-Montrose, would require insurance companies in Alabama to write the same proportion of business in coastal zones as they do in the state as a whole. This could drive up insurance rates statewide because companies would not be able to effectively manage risk. It would also penalize companies that write most of their business in Alabama. AFF opposes.

Bills In Brief

HB 509, sponsored by Rep. Greg Canfield, R-Vestavia Hills, would require appropriations for the Education Trust Fund budget to be capped at the level of the previous year’s revenues with an adjustment up or down equal to the average annual change in revenues over the preceding 15 years. The bill has been assigned to the House Education Finance and Appropriations Committee. AFF supports.

HB 202, sponsored by Rep. Gerald Allen, R-Cottondale, would limit the liability of landowners who lease property for hunting and fishing. The bill passed the House Agriculture and Forestry Committee Wednesday and awaits action by the full House. AFF supports.

HB 338, sponsored by Rep. Jack Williams, R-Birmingham, would require individuals to report acts of animal torture or cruelty. Anyone who failed to report such activities would be subject to a fine. The bill was carried over Wednesday by the House Agriculture and Forestry Committee at the request of the sponsor while he works with agricultural groups to ensure the measure doesn’t negatively impact farming. AFF opposes the bill as introduced, but is working with the sponsor.

SB 362, sponsored by Sen. Kim Benefield, D-Woodland, would give livestock theft investigators the power and authority to execute search warrants. Investigators with the Department of Agriculture and Industries have requested this authority to help curtail a recent rash of cattle rustling. The bill has been assigned to the Senate Agriculture, Conservation and Forestry Committee. AFF supports.

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