Healthcare expansion, lack of communication threaten gambling legislation

When the week started in the Alabama Senate, proponents of the comprehensive gambling legislation that sailed through the House were hopeful that a week’s delay would allow the various factions and parties to come together, iron out differences and find a pathway forward. 

The week ended Thursday with seemingly more disarray, as lawmakers scrambled to rewrite the legislation in a way that attracted Republican votes to a new bill that didn’t include language about healthcare expansion, all while talk of two additional gambling bills – one lottery-only and another lottery-Poarch Creek compact bill – made rounds. 

Despite it all, the core group of senators and interested parties found optimism that they could work a deal for passage, needing only three votes to get there and tantalizingly close to working deals that would secure those votes and possibly a couple of extra. But the legislation that would allow voters to approve a statewide lottery, sports wagering and up to 10 casino locations around the state is very much in question. 

“If anyone tells you that they know what’s going to happen with this legislation, they’re full of sh*t,” said one veteran lawmaker who has worked to advance the legislation since the start of the session. “We knew that the senate was going to be a problem, because of the numbers and what we were trying to do with this bill. We had the votes to start with, because this is a good thing for the state, and I think we’ll get back there. We need to remind folks about promises that were made, and about some consequences.”

According to multiple sources, one of the biggest issues in pulling Republican senators off the bill is a provision that devotes revenue to an expansion of health care services within the state. The expansion is not traditional Medicaid expansion, but a public-private partnership between the state, Blue Cross Blue Shield and other health insurers that would devote tax dollars to providing private insurance plans to some low-income Alabamians. 

According to three lawmakers who were approached by representatives from the Alabama Farmers Federation – the parent group and political entity of Alfa Insurance – the healthcare expansion has been a primary attack point for the Farmers Federation. Those lawmakers said they have since learned that the motivation for those attacks, they believe, is a plan Alfa has in the works to offer its own brand of health insurance. 

Utilizing a provision within the new Farm Bill, Alfa wants to offer its members and possibly others health insurance plans. Those plans would not be subject to the Affordable Care Act provisions, which require certain levels of coverage and mandate that certain costs be covered. As such, the plans would be cheaper and also possibly leave the purchaser on the hook for more costs. 

The state BCBS and other health insurer partnership plan could potentially cut into the market for that plan, the lawmakers said they were told. 

A spokesperson for Alfa on Thursday evening, while confirming plans to “explore options for providing health plans to our members,” strongly denied that the health insurance plans played any role in the Federation’s opposition to gambling. 

“As we’ve shared before, the Federation’s longstanding opposition to gambling is based on written policy developed by our grassroots membership,” said Jeff Helms, director of public relations and communication. “It has absolutely no connection to any other legislation or issue. The Federation is opposed to gambling in all forms, regardless of how potential revenue would be spent.”

The healthcare expansion issue is a particularly tough one, however, if some Republican senators draw a line in the sand over it. The gambling legislation is the rare bipartisan bill that requires Democrats – in a superminority – to support it. 

Democrats have made it clear from the start that they will not accept any form of the bill that fails to include some guarantee that Alabama’s long-running health care crisis, which annually costs thousands of Alabamians their lives, is addressed. They have already compromised by backing away from requiring straight Medicaid expansion and will accept the BCBS plan in order to help as many citizens as possible. 

That reality left lawmakers on Wednesday and Thursday working to craft a different version of the gambling bill that would attract enough Republicans to pass it. It’s unlikely that such a bill exists, and it certainly does not exist in the forms – a lottery-only bill and a combination lottery-compact with PCI bill – being tested the last two days. 

“Working with these people is so frustrating – they don’t even understand the basic laws and how this stuff works,” a lobbyist told APR. “This is a waste of time. No one wants it. But polls show the lottery is the most popular aspect so they think that’ll save them. Just dumb.”

According to multiple sources, not even PCI is supportive of the alternative plans, because it’s unclear if a compact for Class III games (table games, such as blackjack) would be possible. 

Regardless, the health care aspect is not the only problem at this point. There also seems to be confusion – and a serious lack of communication – between important players in the negotiations over the bill. Most notably, multiple lawmakers expressed that they were unsure of where the Poarch Band of Creek Indians stood on the legislation, or why they had objections to the bill. 

That matter is relatively simple: PCI has said it can’t support the legislation unless it provides Alabama-based operators with an opportunity to make the last and best bid for the casino licenses. 

“I don’t see how that is a controversial thing – to give Alabama businesses a fair shot at the end to outbid out-of-state companies,” said Arthur Mothershed, executive VP for business development and government relations for PCI. “We’re asking that all Alabama businesses, not just us, get this opportunity. The state loses nothing. The bids will still come in. They stand to make significantly more for the licenses and reward businesses that have been employing Alabama citizens and paying Alabama taxes for years.” 

According to two lobbyists and a lawmaker, there has been no significant pushback on adding such an amendment, and House leadership has been open to accepting that change should it be added in the Senate. But the appropriate people have not come together to make that deal, they said. 

“I believe that that issue could be ironed out in about a minute if the right people sat down and talked it out. They agree on it,” one lobbyist said. 

If that issue were to be worked out, and if Gov. Kay Ivey and Senate President Pro Tem Greg Reed applied even light pressure to some senators, the majority of sources who spoke with APR said they believed the legislation could be passed. 

That optimism isn’t without reason. They point to a few key facts to explain why they believe it’s more likely than not that a deal gets done. First, the legislation, which allows only a vote by the people, is extremely popular. 

“My damn phone hasn’t stopped ringing about this,” one Republican lawmaker told APR. “I’ve had people – and others up here have had them too – call and say they don’t want gambling but they want to vote on it. It’s a matter of fairness to them, I guess.”

Second, the legislation would haul in a boatload of cash. Sen. Greg Albritton, who is carrying the gambling legislation, said it would be like getting ARPA money every year forever. “It would pay for a lot of stuff we really need,” he said. 

Third, the votes have been there in the past to get the legislation passed, and it would take only a minor push to get those waffling votes back into the fold. When the legislature was attempting to pass a gas tax increase a few years ago, a combination of incentives and threats rallied enough support and deterred defections. 

Finally, it seems to have finally sunk in for most lawmakers and most citizens that gambling is already in Alabama in a major way, and the state is actually suffering by not passing legislation to regulate and tax it. Without some form of legislation, there is no serious proposal for slowing the incredible spread of illegal gambling around the state – much of which is funding organized crime – or for addressing the issues, such as gambling addiction, that stem from tens of thousands of Alabamians participating in gambling in other states, at legal facilities in this state and in quasi-legal facilities and websites available now. 

“I know it’s fun to be cynical and think that everyone here is clueless,” one lawmaker told APR, “but the regulation aspect and addressing addiction and things like that, I think those things truly are troubling to a lot of people in this building. They want to do something about it, and that’s one big reason I think (the legislation) still has a good chance.”