MONTGOMERY — Legislation to establish self-governing innovation districts within cities and counties stalled in the Senate on Tuesday over concerns about taxing and eminent domain powers.

The bills are part of the “Working for Alabama” workforce package unveiled by leadership in the House and Senate, Gov. Kay Ivey, Lt. Gov. Will Ainsworth, and the Business Council of Alabama in March.

Other bills in the package sailed through the Senate on Tuesday, but both of the innovation district bills sponsored by State Sen. Dan Roberts (R-Mountain Brook) and Senate Minority Leader Bobby Singleton (D-Greensboro) weren’t voted on and instead carried over. 

Roberts’ bill would propose an amendment to the Constitution of Alabama of 2022, to authorize the Legislature to allow counties and municipalities to provide for the incorporation of innovation districts as public corporations and provide for their powers and to exempt innovation districts from certain laws. The bill would authorize the Legislature to authorize the state and political subdivisions of the state, without an election, to provide for use of public funds, revenues, property, and services to, or for the benefit of, innovation districts.

Singleton’s bill would allow for the district to have eminent domain powers and be exempt districts from competitive bid laws

“Tremendous amounts of work have gone into this and there’s still a few issues that are being worked out at this time. There are a lot of working parts going on,” Roberts said on the Senate floor on Tuesday.

Singleton said there was a “little more work to do” on the legislation and it would be changed with a substitute amendment. 

“This is one of the most controversial pieces of this workforce legislation. A lot of hours have been put into this piece of legislation on these innovative districts that basically would give counties and cities another tool in the toolbox to be able to help recruit industry in their area,” Singleton said. “While I know it’s kind of broad by giving them taxing powers, giving them eminent domain powers, you know, allowing them to be able to have powers of no competitive bids. At the end of the day, all of these bodies have gotten together and we’ve came up with a sub and the sub would allow for additional requirements for public notice and public meetings as well as the notice to property owners that may be affected by the district. It also adds language to ensure that boundaries of the innovation district must be within the boundaries of the authorizing jurisdiction. I heard something that was so crazy on my way down here today. Someone thought that for example, if Birmingham wanted to set one up in Mobile, then they could. We just wanted to make sure that we get that out of the air, that that does not happen and can not happen.”

State Sen. Arthur Orr (R-Decatur) said, “This is one of the worst bills I think I’ve ever seen, and I may have had some bad ones in my time for sure.” 

“The eminent domain power, once you let this genie out of the bottle the local governing body can’t do much about it at all. They’re self-perpetuating, they can tax. The list goes on and on,” Orr said.

Singleton replied, “I think when you look at this sub, you’re going to see that a lot of that has been taken out.”

Orr said, “My headaches are going to go away so I’ve got great confidence that we’re setting up something that’s more reasonable and that once we let that genie out it’s not some uncontrollable monster that can tax and wheel and deal all around the state to the expense of the people and we have no control over it other than impeachment. I thought that was remarkable.” 

“Impeachment was the only way you could get rid of a board member. It was flabbergasting the breadth and depth of this bill. I commend you in your ingenuity on how to create such a huge genie that we could never control, or should I say Frankenstein,” Orr said.

Singleton said, “I’ve been accused of a lot of things but what I’m always trying to do is to allow for continuation of economic development, build a workforce.” 

“But I agree with you, there was some things that was out there that was a little bit broad. We’ve brought them back in. If you read the sub that’s out there now, you’ll see they’ve been brought in and harnessed in a lot. Therefore, I’m still saying that there are some unintended consequences that are still out there and that’s why we’re going to carry it over to continue to work on it to make sure that we get rid of all those things that we’re not intending to do,” Singleton said on the Senate floor.

State Sen. Sam Givhan (R-Huntsville) compared innovation districts to “mini-states.”

“Innovation districts have significant concerns that relates to the authority they have, the autonomy they have. Basically, we’d be letting them do things that we don’t trust our county commissioners and our city councils to do,” Givhan told 1819 News on Tuesday. “With this legislation, we’re turning it over to boards that aren’t accountable to anybody. Basically, they’d be like their own mini-states and have complete control. I think that’s got a lot of problems with it. It’s getting better, but I’m still not sure. I don’t think it’s necessary. It’s something that’s problematic to a lot of us.”

State Senate Pro-Tem Greg Reed (R-Jasper) told reporters on Tuesday, “I think the issue was it was very complicated between cities, counties, and the state. As we began to collaborate, which is a great thing about what we do in the Senate body, we discovered that there were some elements, this was not a Republican or Democrat issue, just some elements that weren’t exactly the way that the members wanted them.” 

“It required some additional work so they’re going to be on the process of kind of going through exactly what the outcomes are going to be,” Reed said. “I think those bills have real strong support, but we’ve got to make sure they’re right. They impact a lot of folks in a very positive way but we’ve got to make sure the legislation is exactly correct.”

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