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Public gets much-needed tax explanation

The look on the faces of people who attended Thursday night’s town forum on a $1.2 billion tax increase said it all.

As Phyllis Kennedy and David Perry explained Gov. Bob Riley’s tax and accountability package, more than 100 people who attended the forum sat with stern stares and clinched jaws. People, it seemed, wanted to understand what this tax increase is about and what it will mean to the future of Alabama and Marengo County citizens.

Kennedy, who serves on Riley’s cabinet in the Department of Industrial Relations, began Thursday’s forum with a pep-talk of sorts. She explained, through both jokes and consternation, why Alabama citizens must pass the tax.

After spelling out why Kennedy believes citizens must support the plan, Perry &045;&045; a financial analyst with Riley’s office &045;&045; began a PowerPoint demonstration intended to spell out the specifics of the plan.

While working to convince those in attendance that Alabama’s tax burden will remain one of the lowest in the nation, Perry also pitched an often-heard selling point of the tax and accountability package.

In Marengo County, where the median income is $35,000 and the average house is valued at $66,000, Perry said the average citizen here would receive a net tax cut of $213.

As for timberland owners &045;&045; an important part of the economy in west Alabama &045;&045; Perry said most people will not be affected. Only people or companies that own more than 2,000 acres of land will see an increase in property taxes.

According to Perry, the family farms will benefit from the tax package, and the first 200 acres on a family farm will be exempt from the tax.

Combined, Kennedy and Perry spoke for nearly an hour about the ways Riley’s plan will benefit Alabama. And while the forum did not include a formal opponent to the plan, a 15-minute question-and-answer period proved to be all the opposition the forum needed.

Jack Cooley, now retired from Alfa, sprung to his feet when allowed to ask Perry and Kennedy why the tax package shifts so much of the money from education to the Alabama Excellence Initiative Fund after four years.

That fund will be a melting pot of revenue where legislators can decide which state agencies need funding at the time.

The concern for Cooley, and numerous other people, is that legislators will have the opportunity to use that money as a "slush fund."

Perry disputed that claim and said it will be a felony &045;&045; under then new legislation &045;&045; for any legislator to pass through "pork." Passing through "pork" is achieved when a legislator hides money in a state agency and then directs that money to go somewhere else. Most times, that money goes to a supporter back in the legislator’s district or to pet projects around the state.

The Opposition

Bob Gambacurta, spokesman for the Tax Accountability Coalition, wasn’t invited to partake in Thursday’s forum. However, his anti-tax group said much of what Perry and Kennedy said in Demopolis simply wasn’t true.

For instance, Gambacurta said pitching this plan as a tax cut for most Alabamians isn’t really accurate.

Last week, one report said 85 percent of all Alabamians will receive tax cuts under this package. On Thursday, Perry estimated that number to be 67 percent.

Besides rhetorical points, Gambacurta said many of the accountability assertions are not being told honestly.

As it is made to sound, a legislator who passed through pork to a pet project would be committing a crime. However, that isn’t quite the case.

Beyond the pass-through issue, though, Gambacurta said there are endless other ways for legislators to get hold of the money tax payers will give the state.

Another of the accountability measures included in the tax package is a line-item veto for the governor &045;&045; no matter if it’s Riley or the next one.

In other words, if the governor vetoes an item in a budget, the legislature can come right behind him on the same day and over-ride his veto. As a comparison, in the federal government, a two-thirds majority is needed to over-ride the President’s veto.

Another of the questions posed during Thursday’s forum was whether middle- and lower-class people will eventually bear the brunt of this tax hike. Perry said that wouldn’t be the case because even with taxes that are passed down, most will still see a net tax cut.

Gambacurta said that is nonsense.

How people left

When Thursday’s forum was complete, talk on the Civic Center sidewalk still centered on confusion. There were some who came to the meeting in support of the tax, and they left the same way.

Others, like Vern Humble, didn’t like the tax when they got to the forum.

Demopolis City Councilman Willard Williams learned something else about the tax and how it will affect lower-income people.

Perry disagreed.