The bureaucrats of the Alcoholic Beverage Control Board (ABC) are poised to pass a legally suspect tax hike and the Alabama Legislature is complicit. The only question left is whether Gov. Kay Ivey will “un-Bentley” the ABC’s pending tax hike before it’s too late.
Let me explain what I mean.
If there were ever a champion of ABC’s unnecessary bureaucracy, it was former Gov. Robert Bentley. He repeatedly opposed efforts to get Alabama out of the liquor business. Whether it was overhauling the whole system or more discrete efforts like the plan from Sen. Arthur Orr, R-Decatur, to eliminate the ABC’s retail operations, Bentley claimed that any change would lessen the ABC’s ability to enforce Alabama’s liquor laws. The former governor’s sentiment fell a little flat when he actually undermined the ABC’s ability to enforce liquor laws by moving ABC’s law-enforcement capacity to the Alabama Law Enforcement Agency (ALEA) in 2013.
Bentley’s oversight of the ABC continued to raise eyebrows when he demonstrated his lack of fiscal conservatism by giving ABC Administrator Mac Gipson an 80 percent pay increase that Gipson didn’t even request.
Maybe Gipson thought the pay increase included new responsibility, because the ABC is now meddling in state budget policy. More specifically, the ABC is poised to impose a 5 percent tax hike on liquor to pay for a specific line item in Alabama’s General Fund budget. The whole situation is “Bentleyed” in the sense that leadership and transparency are conspicuously absent.
The ABC isn’t calling it a tax; it’s a “markup.” But that can’t be right.
The ABC’s administrative code contains only four enumerated circumstances authorizing the ABC to increase the current 30 percent markup. None involve generating additional revenue for district attorneys.
With the exception of Sen. Bill Holtzclaw, R-Madison, and a few others, the Alabama Legislature seems perfectly willing to go along with the charade.
Nobody should be confused here. This is a tax hike on liquor to fund district attorneys, while the Legislature takes a pass.
Hopefully, Gov. Ivey isn’t as much a fan of playing tax games as her predecessor and many in the Legislature. This shady bureaucratic tax needs to be un-Bentleyed. Ivey can do that with a call to Gipson telling the ABC to stay in its lane.
If our elected officials want to impose another tax on liquor to generate revenue for district attorneys, they should debate the issue and vote on it. It’s not complicated. That’s what we elected them to do.
But they probably won’t because—wait for it—most of their constituents don’t want them to raise taxes. Powerful voices in Alabama have tried to pitch tax hikes in Montgomery since Republicans took control in 2010, and almost all of them have failed.
Tax hikes are lazy anyway. Why not reform the ABC? Getting rid of the ABC’s retail operations, as Orr has suggested, will undoubtedly reduce state expenditures. Legislators can direct part of the savings as an unconditional appropriation to the district attorneys. Problem solved.
That should be a no-brainer for conservatives looking to eliminate bureaucracy and avoid raising taxes at the same time. I’ve been writing and talking about this for years, but I’ve learned that reasoned arguments don’t have the same political clout as property owners who lease stores to the ABC. What? You thought this was about alcohol?
Unfortunately, we’ve reached the point in the session where legislators are tired and want to go home. Combine that with pressure from district attorneys who understandably believe that this is their only shot at increased funding, and most legislatures are prioritizing expediency over creativity.
One thing is clear: The point of the ABC isn’t to craft state budget policy with its markup authority. In fact, there’s a pretty good argument that the ABC doesn’t really have much of a point at all.