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The education trust fund is in trouble and the working class folks are to blame.
The drum beat has already started. The rhetoric is being practiced. The buzzwords are being tested.
A few years of the federal government propping up Alabama’s budgets, and particularly the education budget, are now behind us. And like teens who have run out of money on spring break and lack gas money to get home, our state lawmakers are looking around for someone to blame and someone to fork over cash.
They’ve settled on the working folks.
While there have been hints and vague references for weeks now, the first major test for this line of rhetoric came this week, when Sen. Arthur Orr, the man in charge of the education budget in the Alabama Senate, floated that that doggone overtime tax exemption was just too much money.
That tax exemption was one passed in the 2023 session and it exempted all overtime pay from state taxes, essentially awarding Alabama’s clock-punching workers a 5 percent pay bump on all hours over 40 each week.
It was predicted to cost about $80 million or so, but has actually cost the state about $340 million. Or, to put that another way: Alabama’s hourly workers – the moms and dads who put food on the tables and clothes on little backs – were able to keep more than $300 million of the money they earned working EXTRA HOURS.
In any other context we’d be celebrating this number. Look at all of the hard working Alabamians out here grabbing extra hours and doing all they can to stay ahead of post-pandemic inflation and corporate price gouging.
Ah, but not in this context.
Orr was joined by other lawmakers, including at least one Democrat, who parroted the rhetoric of shock and dismay at this costly, costly tax exemption. We have to do something, they said. Changes must be made, they cried. This cannot continue, they insisted.
If you didn’t stop to think about it, you’d think this overtime tax exemption was going to be the cause of public schools shuttering and teachers standing in bread lines.
If you didn’t think about it.
But if you did think about it … well, you might start to look at some other tax exemptions affecting the education trust fund. You might start to question why, if things are that dire, did we give a dumb $150-per-person tax rebate to people a year ago. You might start questioning the timing of all of this.
But a couple of things you’d definitely question are the two tax exemptions that are funneling staggering amounts of money out of struggling public schools’ coffers and into the pockets of rich people and private businesses: the Alabama Accountability Act and the CHOOSE Act.
Hundreds of millions of dollars annually is projected to come out of our public schools to pay for these gifts to private school students and wealthy families.
The AAA, as it’s known, was an illegal, detestable political hatchet job crafted almost literally in a smoke-filled backroom by good ol’ boys and dumped in surprise fashion on most of the legislature and the voting public. It received no debate and no vetting. Just emerged out of a conference committee from a totally different bill and was voted through by a Republican supermajority.
The AAA has sucked about $30 million per year out of our public schools since 2013, and given it to private schools that mostly don’t have to adhere to similar public school standards. The overwhelming majority of the money has gone to pay for students that were already enrolled in private schools.
But that wasn’t enough.
So, last year, our lawmakers went a step further and passed the CHOOSE Act, which is essentially a voucher program that sends $7,000 checks from our education trust fund directly to private schools to pay for the tuition of students. The first-year cap is at $100 million. There is no cap on recipient income after year two.
That means that almost all of the money will go to families that already have their kids enrolled in private schools – families of means that can afford transportation and that don’t rely on free or reduced lunch. We’re going to remove that $100 million cap in two years and the limitations on recipients, and the total yearly bill, if other states are any indication, will balloon well past a half-billion dollars.
And let’s keep in mind that the CHOOSE Act was passed after the overtime tax exemption, and well past the time lawmakers began their phony fretting over the OT exemption negatively affecting the education trust fund.
If that timeline doesn’t make sense to you, it’s because it doesn’t fit with the rhetoric. That’s typically the case when rhetoric and reality meet. And the reality in this case is utterly deplorable: They want to tax overtime pay of the working class in order to pay the private school tuition bills for rich families.
It’s outright class warfare. And they’re not even really hiding it.
