BOLIN, Justice.
The three appeals in this case involve issues of first impression regarding the Alabama Accountability Act (hereinafter "the AAA"), codified at § 16-6D-1 et seq., Ala.Code 1975.
The Alabama House of Representatives approved House Bill 84 ("HB 84"), a bill relating to education, and the bill, then known as the "Local Control School Flexibility Act of 2013," was sent to the Senate, where the Education Committee gave it a favorable report. (A copy of HB 84 is attached to this opinion as appendix A.) At that time, HB 84 authorized the establishment of innovative schools and school systems by allowing the State Board of Education ("the State BOE") to enter into a "flexibility" contract with the school or school system that would allow for program flexibility and/or budgetary flexibility within the school or school system. The purpose of the flexibility contracts was to "advance the benefits of local school and school systems autonomy in innovation and creativity," HB 84, Section 2(b), by exempting the schools from certain state laws, including State BOE rules, regulations, and policies, in exchange for academic and associated goals for students that improve academic outcomes and close a deficient achievement gap. HB 84 would require a local school to submit a proposed innovation plan that had been recommended by the local superintendent of education and approved by the local board of education to the State Superintendent of Education in order to qualify for "innovation" status. HB 84 authorized the State BOE to promulgate any necessary rules and regulations for implementation.
On February 28, 2013, during the third reading of HB 84 on the floor of the Senate, an amendment, which made minor changes, was proposed and approved, and HB 84 was passed by the Senate. The amended version of HB 84 was then sent to the House, but the House voted to "nonconcur," and HB 84 was sent to a
Notice was issued announcing that the conference committee would meet at 3:15 p.m. The meeting was called to order, but was immediately recessed to reconvene at 4:15 p.m. However, the meeting did not reconvene until 5:00 p.m., at which time a "substitute" version was distributed. The substitute version was 21 pages longer than the original; the name had been changed to the "Alabama Accountability Act of 2013"; and multiple new provisions had been added, including two provisions allowing for tax-credit programs. (A copy of the substitute version of HB 84 is attached to this opinion as Appendix B.) Specifically, Section 8 of HB 84 provided for a tax credit for parents of students who are zoned for a "failing school" and who choose to send their children to a nonpublic school or a nonfailing public school. The tax credits were to be paid out of the Education Trust Fund ("the ETF").
A majority of the conference committee voted in favor of the substitute version of HB 84. Subsequently, HB 84, as substituted, was sent to the House and the Senate for approval. The House and the Senate adopted the substitute version of HB 84, on February 28, 2013, the same day the substitute version was introduced. On March 14, 2013, the governor signed HB 84. On May 20, 2013, the legislature passed House Bill 658 ("HB 658"), which amended portions of the AAA. (A copy of HB 658 is attached to this opinion as Appendix C.) The amendments set out in HB 658 prohibited a public or nonpublic school from being required to enroll a particular student. The amendments also opened the scholarship program to low-income students, even if those students did not attend or were not zoned to attend a failing school. Although the amendments in HB 658 allowed low-income students in nonfailing schools to apply for scholarships, low-income students in failing schools or zoned for failing schools were given priority for the scholarships.
On April 8, 2014, the legislature passed Act No. 2014-346, its annual recodification bill, which adopts and incorporates into the Code of Alabama 1975 those general and permanent laws of the State enacted during the 2013 Regular Session as contained in the 2013 Cumulative Supplement to certain volumes of the Code and additions or deletions made by the Code commissioner for editorial purposes. (A copy of Act No. 2014-346 is attached to this opinion as Appendix D.) The AAA is now set out in § 16-6D-1 et seq.
On August 26, 2013, Daniel Boyd, Anita Gibson, and Senator Quinton Ross, Jr. (hereinafter collectively referred to as "the
On October 9, 2013, the State defendants filed a motion to dismiss the case for failure to state a claim upon which relief could be granted, pursuant to Rule 12(b)(6), Ala. R. Civ. P. The State defendants asserted that the 10-count complaint fell into 2 broad categories: claims that the AAA is invalid based on alleged procedural deficiencies committed during its passage and claims that the law is improperly spending state money. They further argued that there were no procedural deficiencies in the passing of the AAA and that the AAA does not violate any restrictions on the use of public money. Specifically, the State defendants argued that the AAA did not violate the original-purpose requirement or the single-subject requirement because, they argued, the AAA contains two ways of enhancing flexibility in the area of education in that "both the school flexibility contracts and the school-choice tax credit programs give their beneficiaries flexibility from entrenched policies." They argued that the AAA did not repeal an earmark on funds and reappropriate those same funds in one act in contravention of Childree v. Hubbert, 524 So.2d 336, 341 (Ala.1988). This is because, they say, the tax-credit account established in Section 8 is within the ETF so that "every penny of sales-tax proceeds is still going into the Education Trust Fund" and the tax-credit program established in Section 9, while reducing the overall proceeds available to public schools from the income-tax proceeds, does not redirect or un-earmark the income-tax revenues that do enter the public coffers. The State defendants argued that the three-reading requirement was met because the Constitution does not require that a particular version of a bill be read. They argued that the amendments in HB 658 cured any procedural deficiencies in the AAA. The State defendants argued that the AAA did not improperly spend public funds based on Alabama Education Ass'n v. James, 373 So.2d 1076 (Ala.1979). They further argued that because the AAA provides funds directly to parents and not to the nonpublic schools, the funds are not being improperly used to support religious schools. Last, the State defendants argued that the AAA did not create a new public debt in violation of the anti-debt provision in the Alabama Constitution because the tax credits in Section 8 do not require deficit spending.
On October 21, 2013, the circuit court granted a motion to intervene filed by Tequila Rogers, Danyal Jones, and Mark Jones (hereinafter collectively referred to as "the tax-credit parents"). The tax-credit parents are parents of students who, at the beginning of the 2013-2014 school year, used the tax credits created by Section 8 of the AAA, as amended by HB 658, to remove their children from "failing" public
On November 21, 2013, the plaintiffs filed a motion for a judgment on the pleadings as to Counts I-VIII of their complaint. They argued that the AAA had been unconstitutionally adopted because of the significant alteration of its content through a substitute bill and that the AAA violated constitutional restrictions on the appropriation and use of public funds. The plaintiffs did not seek a judgment on the pleadings regarding Counts IX and X of their complaint asserting religion-clause issues because they asserted that factual development would be necessary with regard to the nature of the schools that Alabama schoolchildren will attend at taxpayer expense under the AAA.
That same day, the tax-credit parents filed a motion for a judgment on the pleadings on all of the plaintiffs' claims. The tax-credit parents incorporated the State defendants' arguments and focused on the plaintiffs' claims in Count IX and X of their complaint, which alleged that the AAA violates the manner in which public funds may flow to private religious schools. They argued that the tax-credit programs are religiously neutral student-assistance programs under which parents are free to choose religious and nonreligious schools. They further argued that the AAA does not use any funds that have been raised for the support of public schools because the scholarships are funded by voluntary private donations, not by public funds. The tax-credit parents argued that, although the payment of refundable tax credits does use public funds, those funds are paid to, and used for the support of, parents and students, not religious schools. On April 10, 2014, the State defendants filed a motion asserting that Counts I through V of the plaintiffs' complaint had been rendered moot because the legislature had reenacted the provisions of the AAA when it incorporated them into the Alabama Code as part of its annual codification bill. They argued that the adoption of the 2014 cumulative supplement cured any infirmities of the legislative procedure in enacting the AAA.
On May 28, 2014, the circuit court entered an order in favor of the plaintiffs as to Counts I through VIII of their complaint. We summarize the holdings in the circuit court's order as follows:
In its order, the circuit court denied the State defendants' motion to dismiss and the tax-credit parents' motion for a judgment on the pleadings with regard to Counts I through VIII. The circuit court concluded that, as to Counts IX and X, which involve religion, their motions were moot. The circuit court enjoined enforcement of the AAA.
On May 29, 2014, the State defendants and the tax-credit parents filed a joint motion to stay the circuit court's order enjoining the enforcement of the AAA. The plaintiffs opposed the joint motion to stay.
On May 30, 2014, Rachell Prince, Tyrone Whitehead, and Dalphine Wilson, parents of children who received scholarships from the scholarship program created by Section 9 of the AAA (hereinafter collectively referred to as "the scholarship parents"), filed a motion to intervene. In affidavits, the scholarship parents stated that their
On June 5, 2014, the State defendants filed a timely notice of appeal from the circuit court's May 28, 2014, order. On June 9, 2014, the circuit court granted the joint motion to stay that part of its order enjoining the enforcement of the AAA. That same day, the circuit court denied the scholarship parents' motion to intervene. On June 11, 2014, the tax-credit parents filed a timely notice of appeal from the circuit court's order of May 28, 2014. That same day the scholarship parents filed a notice of appeal from the circuit court's order of June 9, 2014, denying their motion to intervene. On June 27, 2014, this Court consolidated the three appeals.
The first issue we address is whether any of the plaintiffs' procedural claims were rendered moot by actions of the legislature following the passage of the AAA. The plaintiffs asserted several claims that the AAA was unconstitutional based on procedural deficiencies in the passage of the AAA. Specifically, the plaintiffs asserted: Count I — the AAA violated the "original purpose" requirement of § 61 because a substitute version of HB 84 was proposed and adopted on February 28, 2013; Count II — the AAA violated the readings "on three different days" requirement set out in § 63 because the substitute version of HB 84 was read and passed on February 28, 2013; and Counts III-V — the AAA violated the "single subject" requirement set out in §§ 45 and 71 because the substitute version of HB 84 added to the flexibility contracts for local schools Sections 8 and 9 providing for tax credits to pay for private-school tuition. Subsequent to the passage of HB 84, the legislature amended the AAA by passing HB 658, and, later, the legislature adopted its annual cumulative supplement bill in Act No. 2014-346.
HB 658 amended Sections 4, 5, 8, and 9 of the AAA. The text of HB 658 indicates that the legislature voted only on whether to amend certain sections of the AAA. A vote against HB 658 would not have been a vote to repeal the AAA but would have been a vote against amending the AAA. The State defendants argue that HB 658 amended Sections 8 and 9 and that the plaintiffs cannot now complain that the enactment of the substitute version of HB 84 violated the original-purpose and three-readings requirements of the Constitution by including Sections 8 and 9 in the substitute version.
In Board of Revenue of Jefferson County v. Hewitt, 206 Ala. 405, 90 So. 781 (1922), Jefferson County had entered into construction contracts based on the belief that certain bonds could be sold to pay the contractors. However, the bonds could not be sold at less than their face value pursuant to the 1907 Code of Alabama. The legislature enacted a curative statute in 1920 (applicable only to Jefferson County based on its population) to provide for the sale of county bonds at less than their face value and for reimbursement of contractors who had advanced to the county the difference between the market value and the face value of the bonds. A taxpayer sued the Jefferson County Board of Revenue arguing that the 1920 statute violated the Constitution, which required a majority of electors to authorize a bond issue, and that the 1920 statute changed the material conditions and authority given in an earlier election authorizing bonds in accordance with the 1907 Code. Although the Court in Hewitt stated that "subsequent legislative ratification is the equivalent of primary legislation," the Court recognized that the extent and effect of retroactive or curative statutes may be validated only when the legislature "originally had authority to confer the powers or to authorize the act or transaction" and that the curative statute did not have the effect of validating an unconstitutional statute. 206 Ala. at 409, 90 So. at 785-86.
In Glass v. Prudential Insurance Co. of America, 246 Ala. 579, 22 So.2d 13 (1945), superseded by statute on other grounds as recognized by Mooney v. Weaver, 262 Ala. 392, 79 So.2d 3 (1955), the court again addressed the constitutionality of §§ 890 and 891 of the Code of Alabama of 1940. Those sections provided a remedy by way of a tax refund, but the Court had earlier concluded that they violated the constitutional prohibition against suing the State. A few years later, the legislature amended §§ 890 and 891 seeking to cure the constitutional defect. It was then argued that the amended acts violated the constitutional prohibition against reviving or amending an act by reference to its title only. The Court held that the title to the 1943 act, which was "[t]o amend Sections 890 and 891" was not defective even though the sections sought to be amended had earlier been declared unconstitutional. The Court explained that the reference to §§ 890 and 891 in the title of the act was for identification only because the amending act was "complete in itself," and "not dependent on the repealed act for any other purpose." 246 Ala. at 583, 22 So.2d at 16. The fact that §§ 890 and 891 had been repealed did not militate against their use for identification purposes. In short, the amending act was a new act correcting the constitutional prohibition against suing the State, which had rendered the prior versions of §§ 890-891 unconstitutional. The Court's statement that the amending act was complete in itself did not indicate that any amendments to a legislative act reenact the original act.
In the present case, we find State v. Martin to be controlling on this issue. HB 658 amended only certain sections of the AAA and, in the passage of HB 658, only those amended sections were voted
We now turn to whether the legislature's adoption of its annual cumulative-supplement bill cured any alleged procedural defects occurring during the enactment of the AAA. In Ex parte Coker, 575 So.2d 43 (Ala.1990), the Court explained why the adoption of a cumulative-supplement bill did not give the force of law to a bill that had been improperly enacted but that was included in the codification bill. The Court discussed the history of the adoption of the Code of Alabama 1975. The Court noted that the legislature authorized the appointment of a Code commissioner in 1969 to revise, digest, and codify all the statutes and that the legislature in 1976 appointed a special joint committee to study the Code manuscript. All the legislators were given a copy of the Code manuscript, and in 1977 the legislature adopted the Code manuscript prepared by the Code commissioner, as reviewed and revised by the legislature. The Court noted that a similar process was used when the legislature adopted the 1852, 1867, 1876, 1886, 1896, 1907, 1923, and 1940 Codes of Alabama. The Coker Court recognized that it was the process of adopting an entire Code after notice, study, and revision by the legislature of the Code commissioner's manuscript that the Court had in mind when it held that "`[a]ll infirmities of legislative procedure in enacting an original act are cured when that act is incorporated into a code and the code adopted by the legislature.'" Ex parte Coker, 575 So.2d at 50 (quoting Fuller v. Associates Commercial Corp., 389 So.2d 506, 509 (Ala.1980)).
The Court in Coker went on to cite several cases that involved the cure of defectively enacted statutes by adoption of an entire Code where the Codes were "adopted by the process of appointment of a code commissioner, review by the legislature of the code as a systematic revision of existing law, and enactment by the legislature of the manuscript as a new code governing the subjects included therein." 575 So.2d at 51. The Court then contrasted this systematic review of the Codes with the 1983 cumulative-supplement act at issue in Coker, which adopted and incorporated into the 1975 Code all general laws enacted during the 1979 and 1980 Sessions, the 1981 Regular Session, and the 1982 Regular Session of the legislature. The 1983 cumulative-supplement act also corrected several grammatical and typographical errors in both the 1975 Code and the recent enactments being incorporated into the 1975 Code. The Court noted that the legislature had, by acts equivalent
In Ex parte State Department of Revenue, 683 So.2d 980 (Ala.1996), the Court acknowledged its holding in Ex parte Coker that the process of adopting the entire Code repeals any portion of the original legislation and any prior codification not included in that adoption. "[T]he adoption of the entire Code supersedes the original enactments and any prior codification." 683 So.2d at 982. The Court went on to state:
683 So.2d at 982.
In Swift v. Gregory, 786 So.2d 1097 (Ala. 2000), the issue was whether the act as modified by the Code commissioner took precedence over the original bill passed by the legislature when the two versions differed. The Code commissioner moved a sentence out of a paragraph and placed it in its own paragraph. The Court, quoting State v. Towery, 143 Ala. 48, 49, 39 So. 309, 309 (1905), stated:
Swift, 786 So.2d at 1100.
We note that the complete quote from Towery, which was shortened in Swift, is as follows:
143 Ala. at 49, 39 So. at 309. The Court in Towery referred to the formal process of reenacting the entire Alabama Code as then set out in Article IV, § 46, of the 1875 Constitution. The Court explained the process by which an entire Code is adopted, noting that "the whole matter was referred to a committee, which carefully examined the proposed Code, comparing section by section, with the amendments and additions suggested, and reported on the same and the Act was passed according to the requirements of
In Densmore v. Jefferson County, 813 So.2d 844 (Ala.2001), the Court first concluded that the Storm Water Act was a general law rather than a local law within the meaning of the constitutional requirement that notice of the intent to apply a local law be published in the affected counties as set out in Art. IV, § 106. Although not necessary to its holding that the Storm Water Act was constitutionally enacted, the Court went on to discuss whether the 1995 adoption of the annual cumulative-supplement bill to the 1975 Code would have cured any alleged procedural defects in its enactment because this was the basis of the trial court's holding. The Court in Densmore concluded that Ex parte Coker was not controlling, because "the annual codification process was begun after this Court had decided Coker," as noted in Ex parte Department of Revenue. 813 So.2d at 851. The Densmore Court went on to hold that, assuming arguendo, that the Storm Water Act was a local act, any infirmities in the adoption of the act were cured by the adoption of the annual cumulative-supplement bill.
In the present case, we find Ex parte Coker to be controlling on the issue whether the adoption of the 2014 cumulative-supplement bill in Act No. 2014-346 cured any alleged enactment-related constitutional deficiencies in the AAA. The Coker Court explained why procedural infirmities in enacting a particular act are cured by the adoption of Code as a systematic revision of existing law but are not cured by the adoption of the annual cumulative-supplement bill. The United States Bankruptcy Court for the Northern District of Alabama also explained in In re Jefferson County, 469 B.R. 92, 105 (Bankr.N.D.Ala. 2012), the collaborative process that is employed when a Code is enacted:
No such review or collaboration occurred in the passage of Act No. 2014-346. Instead, the adoption of the cumulative supplement in Act No. 2014-346 was part of the Code commissioner's
To conclude that the adoption of the annual cumulative-supplement bill cures any enactment-related deficiencies would be to ignore the procedural requirements set forth in the Alabama Constitution, which serve to protect the integrity of the legislative process. Cf. State v. Buckley, 54 Ala. 599, 612 (1875) (explaining that the "main controlling aim and purpose" of constitutional provisions such as the original-purpose requirement, three-readings requirement, and single-subject requirement is to "prevent `hodge-podge' and injurious combinations, by confining each law to one subject" and to "prevent hasty and inconsiderate legislation, surprise and fraud"). It would also effect a nullification of numerous cases addressing those constitutional procedural requirements for enacting legislation. It is the thoughtful, systematic, and collaborative review of the entire Code through a Code manuscript along with revisions by the legislature when adopting an entire new Code that validate any procedural infirmities in the enactment of original legislation.
We recognize that the Court in Densmore held that any procedural infirmities in the Storm Water Act were cured through the legislature's enactment of the annual cumulative-supplement bill in 1996. The Densmore Court found that Ex parte Coker was not controlling, in part because "the annual codification process was begun after this Court decided Coker," as noted in Ex parte State Department of Revenue. 813 So.2d at 851. In Ex parte State Department of Revenue, the Court did note that the process had been "refined" since this Court's opinion in Ex parte Coker. 683 So.2d at 982. Indeed, we note that subsequent to our decision in Ex parte Coker, the legislature, in 1993, did statutorily create a permanent Code commissioner. Act No. 1993-618, amending § 29-7-1 et seq., Ala.Code 1975. Before then, the Code commissioner was sometimes the publisher of the Code, sometimes an individual appointed by the governor or the legislature, or sometimes a Code commission or Code committee. In 1996, the legislature adopted § 29-7-8, addressing the Code commissioner's compilation of the Code, specified editorial functions, and exempting the adoption of the annual cumulative-supplement bill from the single-subject requirement of § 45. However, the adoption of the cumulative-supplement bills enacted after 1993 occurred nearly annually and accomplished essentially the same tasks as today, i.e., adopting and incorporating recent enactments from the previous year or legislative sessions into the 1975 Code, along with making typographical and grammatical changes. Cf. Act No. 1978-674; Act No. 1979-37; Act No. 1980-753; Act No. 1981-653; Act No. 1982-567; Act No. 1983-131; Act No. 1984-259; Act No. 1985-45; Act No. 1986-375; Act No. 1987-805; Act No. 1988-918; Act No. 1989-525; Act No. 1989-990; Act No. 1991-553; Act No. 1993-614; Act No. 1994-305; Act No. 1995-255; Act No.
The Densmore Court also concluded that Ex parte Coker was not controlling because Coker involved a pocket veto of legislation that never became law.
To the extent that the judicial dicta in Densmore can be relied upon and conflicts with this opinion, we overrule it.
We now turn to whether the plaintiffs' procedural claims set out in Counts I-III of their complaint regarding the original-purpose requirement of § 61, the three-reading requirement of § 63, and the single-subject requirement of § 45, involve a political question such that those constitutional requirements are reserved for the legislature to determine. The State defendants argue that the three-readings requirement speaks in terms of "bill[s]," which highlights its relationship to matters of "internal voting proceedings," which is within the domain of the legislature as discussed by the Court in Birmingham-Jefferson Civic Center Authority v. City of Birmingham, 912 So.2d 204 (Ala.2005)(hereinafter "BJCCA"). They contend that the original-purpose requirement also speaks in terms of "bill[s]" and therefore endows the legislature with primary enforcement responsibility. The State defendants argue that the single-subject requirement will lure the Court into making improper policy judgments.
In BJCCA, we declined to consider a "nonjusticiable political question" involving the voting procedures of the legislature. This Court referred to the United States Supreme Court's formulation of what constitutes a nonjusticiable political question, being mindful that there are differences between the United States Constitution and the Alabama Constitution in that the separation-of-powers doctrine is explicit in the Alabama Constitution and implied in the United States Constitution:
BJCCA, 912 So.2d at 214-15 (quoting Baker v. Carr, 369 U.S. 186, 217, 82 S.Ct. 691, 7 L.Ed.2d 663 (1962)).
In BJCCA, the City of Birmingham and Jefferson County sought a judgment declaring that certain taxation statutes were invalid because they were not passed by a majority of a proper quorum of the House of Representatives, as required by § 63 of the Alabama Constitution. 912 So.2d at 206-07. The issue before the trial court was whether "a bill must receive the affirmative vote of a majority of a quorum, or... only the affirmative vote of a majority of the yea and nay votes cast in the presence of a quorum." 912 So.2d at 209. The trial court found that the Constitution required the former — the affirmative votes of a majority of a quorum — but that only the latter had actually occurred, rendering the acts unconstitutional. On appeal, this Court held that the case presented a non-justiciable political question and that the trial court should have declined to decide the question. 912 So.2d at 205. The Court explained that there was evidence in the form of affidavits that, for at least 30 years, the legislature had interpreted § 63 to mean that when a quorum is present and a bill receives a favorable majority of those votes for and against it, then that bill has passed that house of the legislature. The Court noted that, as a matter of local legislative courtesy, members of the legislature had the practice of abstaining from voting on a bill of purely local application unless the bill is applicable to that legislator's county. Although the members of the legislature did not always follow this practice, both the House and the Senate had rules in place contemplating that fewer than a quorum present may vote on a bill. In short, the legislature's interpretation of § 63 was reflected in its rules and practices. The Court, following the principles in Baker v. Carr, concluded:
912 So.2d at 221.
BJCCA was not the first time this Court had addressed the interplay between the separation of powers and judicial review of legislative action. In Rice v. English, 835 So.2d 157 (Ala.2002), there was a constitutional challenge to the Senate's redistricting plan. In addressing the defendants' argument that the Court should decline to address the challenge based on the separation-of-powers doctrine, the Court stated:
835 So.2d at 162. The Court went on to acknowledge the principle in Selma & Gulf R.R., 45 Ala. 696 (1871), that although the Court has the power to exercise judicial review of acts of the legislature, the Court should be mindful of the need for restraint.
835 So.2d at 162 (quoting Selma & Gulf R.R., 45 Ala. at 728).
Subsequent to BJCCA, the Court addressed whether the Constitution was violated by the legislature's authorization of a permanent joint legislative committee to disburse appropriations from the education budget through awards of community-services grants. The Court concluded that the case was not concerned with internal legislative matters of parliamentary procedure, but with a question concerning the fundamental power of the legislature to enact a law of statewide application. The political-question doctrine was no bar, therefore, to judicial resolution of the issue presented.
McInnish, 925 So.2d at 187 (emphasis omitted).
In Jefferson County v. Weissman, 69 So.3d 827 (Ala.2011), the issue involved whether published notice of legislation regarding the reenactment of Jefferson County's occupation tax complied with § 106 of the Alabama Constitution, which requires notice by publication to those affected by the local legislation. The Court noted that the purpose of the notice requirements of § 106 is the prevention of deception and surprise so that those affected may have a fair opportunity to protest or otherwise to express their views. The Court held that it could review the adequacy of the notice given for the local act. The Court noted that numerous cases from the Court had assessed the adequacy of notice under the constraints of § 106 to determine the constitutionality of the challenged legislation. The Court concluded that it was the special province of the courts to determine whether the notice requirements complied with the Constitution, and the Court declined to retreat from its history of judicial review on the subject.
In order to determine the existence and extent of any "textual commitment" to the legislature in this case as set out in the first factor in Baker v. Carr, it is necessary to turn to the constitutional provisions governing the exercise of the power in question. It is without question that the text of the Alabama Constitution commits to the legislature the legislative power of this State. Art. IV, § 44 ("The legislative power of this state shall be vested in a legislature, which shall consist of a senate and a house of representatives."). The text of the Alabama Constitution also gives each house the power to enact rules governing its proceedings. Art. IV, § 53 ("Each house shall have power to determine the rules of its proceedings and to punish its members and other persons, for contempt or disorderly behavior in its presence; to enforce obedience to its processes; to protect its members against violence, or offers of bribes or corrupt solicitation; and with the concurrence of two-thirds of the house, to expel a member, but not a second time for the same offense; and the two houses shall have all the powers necessary for the legislature of a free state.").
Although not referring to a single internal rule or to the legislature's choice or policy of complying with its internal rules or procedures, the State defendants essentially argue that the Constitution grants the legislature power to set its own internal procedures, including the procedures by which it determines its own compliance with constitutional procedural limitations, and because, they say, the plaintiffs are making a policy-based challenge of whether the AAA met the original-purpose, three-readings, or single-subject requirements, allowing the legislature final authority to decide its compliance with those constitutional requirements will in no way deprive another constitutional provision of its field of operation. We note that the present case is easily distinguishable from BJCCA. BJCCA involved an internal rule promulgated by the House of Representatives, along with evidence of at least 30 years of local legislative courtesy regarding the legislature's internal voting procedures. It is also distinguishable from Ex parte Marsh, 145 So.3d 744 (Ala.2013). In Marsh, this Court addressed a mandamus petition arising out of allegations that the AAA was passed in violation of the Open Meetings Act and an internal legislative rule regarding additions to bills going to a conference committee.
The factors set out in Baker v. Carr must be interpreted in light of the purpose of the political-question doctrine:
Japan Whaling Ass'n v. American Cetacean Soc'y, 478 U.S. 221, 230, 106 S.Ct. 2860, 92 L.Ed.2d 166 (1986) (emphasis added). Nevertheless, the exercise of the judiciary's power to interpret the Constitution and to review the constitutionality of the acts of the legislature does not offend these principles. Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177-78, 2 L.Ed. 60 (1803). The legislature's exclusive power over its internal rules does not give the legislature the right to usurp the function of the judiciary as ultimate interpreter of the Alabama Constitution. In carrying out this function, we do not violate the separation-of-powers doctrine upon which the political-question doctrine is based when we determine whether a legislative enactment was constitutionally adopted. Therefore, the first factor in Baker v. Carr does not preclude our review of the plaintiffs' challenges.
Neither does this Court lack "judicially manageable standards" under the second factor in Baker v. Carr to evaluate the plaintiffs' constitutional challenges. In United States v. Munoz-Flores, 495 U.S. 385, 110 S.Ct. 1964, 109 L.Ed.2d 384 (1990), the issue was whether 18 U.S.C. § 3013, which required courts to impose a monetary "special assessment" on any person convicted of a federal misdemeanor, was passed in violation of the Origination Clause of the United States Constitution. The Origination Clause mandates that "[a]ll Bills for raising Revenue shall originate in the House of Representatives." U.S. Const., Art. I, § 7, cl. 1. In rejecting the argument that the case involved a political question, the Supreme Court stated:
Munoz-Flores, 495 U.S. at 395-96, 110 S.Ct. 1964. There exists no lack of judicially manageable standards where the underlying determination to be made is legal in nature and requires this Court to apply normal principles of interpretation to the constitutional provisions at issue.
The plaintiffs are alleging that the legislature violated mandatory provisions of the Alabama Constitution. Simply because the plaintiffs and the State defendants
The plaintiffs' complaint requires an interpretation of the Constitution, and we decline to forgo our responsibility to ensure that the legislature functions within the bounds of the Constitution under the pretext of deference to a coequal branch of government as set out in the fourth factor in Baker v. Carr. Invalidating a law for violating the original-purpose, three-readings, or single-subject requirements of the Alabama Constitution would not evince a lack of respect for the legislature within the meaning of Baker v. Carr. The authority to determine adherence to the Constitution is with the judiciary, and, if the legislature has not discharged its constitutional duty, then it is the judiciary's duty to say so.
The State defendants do not suggest that answering the plaintiffs' constitutional challenges presents an "unusual need for unquestioning adherence to a political decision already made." Nor do they suggest that there is any more danger of "multifarious pronouncements" in this context than in any other in which this Court determines the constitutionality of legislation. Baker v. Carr, 369 U.S. at 217, 82 S.Ct. 691. Accordingly, the plaintiffs' procedural challenges to the AAA, set out in Counts I-III are justiciable.
We now turn to whether the circuit court erred in granting the plaintiffs' motion for a judgment on the pleadings regarding the constitutionality of the AAA in Counts I-VIII of their complaint.
A circuit court's grant of a Rule 12(c), Ala. R. Civ. P., motion for a judgment on the pleadings is subject to de novo review. Universal Underwriters Ins. Co. v. Thompson, 776 So.2d 81 (Ala.2000). "A court reviewing a judgment on the pleadings accepts the facts stated in the complaint as true and views them in the light most favorable to the nonmoving party." Universal Underwriters, 776 So.2d at 82.
This Court's review of constitutional challenges to legislative enactments is de novo. Richards v. Izzi, 819 So.2d 25, 29 n. 3 (Ala.2001). In Mclnnish v. Riley, 925 So.2d at 178, this Court further stated:
(Emphasis omitted.)
"`"It is the duty of the court to construe a statute so as to make it harmonize with the constitution if this can be done without doing violence to the terms of the statute and the ordinary canons of construction."`" Ex parte Jenkins, 723 So.2d 649, 658 (Ala.1998) (quoting Board of Educ. of Choctaw Cnty. v. Kennedy, 256 Ala. 478, 482, 55 So.2d 511, 514 (1951), quoting in turn Almon v. Morgan Cnty., 245 Ala. 241, 246, 16 So.2d 511, 516 (1944)).
Alabama State Fed'n of Labor v. McAdory, 246 Ala. 1, 10, 18 So.2d 810, 815 (Ala. 1944). "`"We will not invalidate a statute on constitutional grounds if by reasonable construction it can be given a field of operation within constitutionally imposed limitations."'" Lunsford v. Jefferson Cnty., 973 So.2d 327, 330 (Ala.2007) (quoting Town of Vance v. City of Tuscaloosa, 661 So.2d 739, 742-43 (Ala.1995) (other citation omitted)).
The plaintiffs challenge the constitutionality of the AAA, arguing that the substitute version of HB 84, which added the tax-credit programs to pay for the education of Alabama schoolchildren in nonpublic schools, altered the original purpose of HB 84 in violation of Article IV, § 61. Section 61 provides that "[n]o law shall be passed except by bill, and no bill shall be so altered or amended on its passage through either House as to change its original purpose." The "purpose" of a bill as contemplated in § 61 of the Constitution "is the general purpose of the bill and not the mere details through which and by which that purpose is manifested and effectuated." State Docks Comm'n v. State, 227 Ala. 521, 533, 150 So. 537, 547 (1933).
In Blackwell v. State, 230 Ala. 139, 162 So. 310 (1935), the issue was whether the purpose of a bill was so changed during the legislative process as to violate § 61. The Court held that it was not. The original bill relating to gambling provided as follows:
230 Ala. at 140, 162 So. at 311.
The final bill that was adopted provided as follows:
Act No. 671, Ala. Acts 1931.
In addressing the original-purpose requirement, the Blackwell Court stated:
Blackwell, 230 Ala. at 140, 162 So. at 311.
In Opinion of the Justices No. 153, 264 Ala. 176, 85 So.2d 391 (1956), the House of Representatives sought, among other things, an advisory opinion as to whether the amendment to the bill at issue so altered the bill as change its original purpose in contravention of § 61. The original bill stated that the purpose was to provide for the operation of public schools; the amendment provided that the purpose was to provide for public education, including institutions of higher learning. The Court noted that, under Alabama caselaw, public schools had never been understood to include higher institutions of learning like colleges and universities. The Court stated:
264 Ala. at 180, 85 So.2d at 394-95.
In Opinion of the Justices No. 266, 381 So.2d 187 (Ala.1980), the Senate asked the Court whether § 61 had been violated by subsequent amendments to an original bill. The purpose of the bill as originally introduced was to transfer funds from the State insurance fund to be earmarked for Medicaid purposes. The Finance and Taxation Committee amended the bill to provide only for "medicaid and investigation of welfare fraud purposes." The Court opined that the Committee's amendment did include an additional earmarking provision, i.e., it provided that the transferred funds could be used for "investigation of welfare fraud." However, that amendment was sufficiently germane and cognate to the original purpose of the original bill that the amendment did not violate § 61. Subsequently, another amendment was made to the bill to include funds to pay for cost-of-living raises for certain education
In the present case, we cannot say that the substitute version of HB 84 so changed the original bill that its original purpose was changed in violation of § 61. The purpose of a bill within § 61 has been held to be the general purpose. A determination of whether an amendment or substitute act changed the original purpose depends on whether the subject matter of the amendment or substitute was germane to the general purpose. The substitute version of HB 84 was not so diverse from the original purpose as to have no necessary connection to it. The purpose of the original bill in providing flexibility contracts was to advance the benefits of local school and school-systems autonomy in innovation and creativity by exempting the schools from certain State laws, including State BOE rules, regulations, and policies, in exchange for academic and associated goals for students through flexibility contracts. The substitute bill contained the provisions for flexibility contracts between schools and the State BOE and included the tax-credit programs to provide for state accountability for students in failing schools. New matter may be included in an amended bill, so long as that new matter is germane to the general purpose. The prohibition in § 61 is directed to the introduction of matter that is not germane to the general purpose of the legislation or that is unrelated to its general purpose. We cannot say that the substitute version of HB 84 changed the general purpose of the original bill so as render the AAA unconstitutional under § 61.
The plaintiffs challenge the constitutionality of the AAA, arguing that the original version of HB 84 so differed substantially in form and substance from the substitute version of HB 84 that the substitute version was not read on three different days in each house in violation of § 63. Section 63 provides:
This Court has stated:
Jones v. McDade, 200 Ala. 230, 234, 75 So. 988, 998 (1917).
The circuit court here found Opinion of the Justices No. 12, 223 Ala. 365, 368, 136 So. 585, 588 (1931), to be persuasive in its analysis of the three-readings requirement. In Opinion of the Justices No. 12,
The original version of the proposed amendment authorized the issuance of interest-bearing warrants for the purpose of paying a past-due indebtedness. The version that passed both houses on the last legislative day completely revised the system of taxation. The proposal to change the system of taxation then became the major subject and purpose of the proposed constitutional amendment. In its amended form, the proposed constitutional amendment was not read on three separate days in each house. The Court held invalid the proposed amendment as thus amended by the legislature, concluding that the changes in the subsequent versions of the proposed amendment were too drastic to come within the protection of the "principle that proposed amendments may be amended during the course of the legislative procedure for the purpose of perfecting the same and to harmonize with the judgment of the requisite majority of the two bodies" and "that the proposal of the amendment in question violated both the letter and spirit of section 284 of the Constitution, and must be declared null and void." 223 Ala. at 369, 136 So. at 588.
In Storrs v. Heck, 238 Ala. 196, 190 So. 78 (1939), a constitutional amendment was challenged on the ground that certain procedural requirements set forth in the Constitution were not followed, including the three-reading requirement of § 284. The proposed constitutional amendment, as it passed the House, suspended the constitutional limitations on the legislature's authority to reduce compensation of State officials. It was amended in the Senate by a substitute bill to provide, among other things, a maximum compensation of $6,000 per annum for State officials. The House concurred in the Senate's amended version, and the amendment was subsequently ratified by the electorate. The main argument was that the proposed constitutional amendment as voted on by the people did not receive the required three readings in haec verba in both houses. The Court held that the Senate amendment limiting compensation was in the nature of a "legislative detail" and, therefore, did not constitute a departure from the original bill.
In Opinion of the Justices No. 224, 335 So.2d 373 (Ala.1976), one of the questions answered was whether the legislature had complied with the three-readings requirement of § 284. The original House bill proposed a constitutional amendment authorizing the issuance and sale of general obligation bonds in the principal amount of $7,000,000 to fund construction of secure mental-health facilities. It was read twice in the House. It was amended by a substitute bill that raised the authorization to $9,000,000 and, in addition, provided that part of the money be used to construct a seed-technology center and a seed-processing facility. That bill was read at length and passed in the House. It was then sent to the Senate and read at length twice. It
The Court found that the amendments to the bill were not read in each house on "three several days" as required in § 284. However, the Court concluded that there had been substantial compliance with § 284. "The central question in the proposed constitutional amendment, posed by original House Bill 335, was whether Alabama would incur debt. No amendment of that bill changed that question. Each of the three readings in the respective houses of the Legislature posed that question to those houses." 335 So.2d at 375.
In the present case, it is clear that the substitute version of HB 84 was not read "on three different days" in each house. However, we hold that an amended bill or a substitute bill, if germane to and not inconsistent with the general purpose of the original bill, does not have to be read three times on three different days to comply with § 63. The legislature complies with the three-readings requirement if the three readings include the version before the substitution was made. On their face, the legislative journals indicate three readings of HB 84 in both houses even though the substitute version was read only once in each house. This practice complies with § 63 so long as the original bill and the amended or substitute bill are not vitally altered so that there is no longer a common purpose or relationship between the original bill and the amended or substitute bill.
Several state courts have held that a substituted or amended bill is not a new bill necessitating rereading where its subject is germane to the original bill. Van Brunt v. State, 653 P.2d 343, 345 (Alaska Ct.App.1982) (holding that the reading requirement did not extend to amended bills, even those that have been "substantially alter[ed]," unless the subject matter of the bill is changed); People ex rel. Cnty. Collector v. Jeri, Ltd., 40 Ill.2d 293, 239 N.E.2d 777 (1968) (holding that constitutional requirement that bills be read three times does not extend to an amended bill when the amendments are germane to the general subject of the bill); People v. Clopton, 117 Mich.App. 673, 324 N.W.2d 128 (1982) (holding that when an original bill has met the procedural constitutional requirements for passage, an amended version or substitute bill need not also meet those requirements in its later form, so long as the amended version or substitute serves the same purpose as the original bill, is in harmony with the objects and purposes of the original bill, and is germane thereto); State v. Ryan, 92 Neb. 636, 139 N.W. 235 (1912) (holding that where amendments have been made to a bill after its first or second reading, it is not required that the bill be read on three separate days); Frazier v. Board of Comm'rs, 194 N.C. 49, 138 S.E. 433, 437 (1927) (holding that rereading of a bill is necessary only when the bill is amended "in a material matter"); Hoover v. Board of County Comm'rs, 19 Ohio St.3d 1, 5, 482 N.E.2d 575, 579 (1985) (holding that amendments that do not "vitally alter" the substance of a bill do not trigger a requirement that the amended bill be reconsidered three times); and Stilp v. Commonwealth, 588 Pa. 539, 905 A.2d 918 (2006) (holding that a bill does not have to be considered on three separate days if amendments to the bill during the legislative process are germane and do not change the general subject of the bill). Cf. Maybee v. State, 4 N.Y.3d 415, 417-18, 796 N.Y.S.2d 18, 828 N.E.2d 975 (2005) (discussing compliance with New York Constitutional requirement that
In challenging the AAA under §§ 45 and 71, the plaintiffs alleged in Count III of their complaint that the AAA violates the "single-subject" requirements because Sections 5-7 of the AAA authorize the State BOE to enter into school-flexibility contracts with local school systems to allow exemptions from certain State laws or regulations in contrast to Sections 8 and 9, which create tax credits to pay for the education of schoolchildren in nonpublic schools. In Count IV, the plaintiffs allege that, because Section 8 "set(s) aside" sales-tax money from the ETF and deposits it into a Failing School Income Tax Credit Account, the AAA both repeals an earmark of funds and makes a new appropriation in one act. In Count V, the plaintiffs allege that because Section 9 provides for an income-tax credit to reimburse 100% of the amount contributed to scholarship-granting organizations, the AAA redirects income-tax revenue from the ETF and effectively repeals an earmark and appropriates funds in one bill.
Section 45 provides:
(Emphasis added.)
Section 71 provides:
(Emphasis added.)
The plaintiffs have alleged that the AAA violated the single-subject requirements of both § 45 and § 71. As the Court explained in Opinion of Justices No. 174, 275 Ala. 254, 154 So.2d 12 (1963), an appropriations bill that is not a general appropriations bill must meet the single-subject requirement of § 71. If an appropriations bill complies with § 71 in having a single subject, then it necessarily complies with that portion of § 45 mandating that each law contain but one subject.
The purpose behind the single-subject requirement has been stated to be:
Lindsay v. United States Say. & Loan Ass'n, 120 Ala. 156, 172, 24 So. 171, 176 (1898) (addressing the single-subject requirement of the 1875 Constitution).
As early as 1909, this Court recognized:
State ex rel. Birmingham v. Miller, 158 Ala. 59, 62, 48 So. 496, 497 (1909).
We turn first to the Counts IV and V of the plaintiffs' complaint in which they allege that the AAA violates the single-subject requirements of §§ 45 and 71 because Section 8 repealed an earmark on funds dedicated to the ETF while also making a new appropriation of those funds to pay for tax credits and because Section 9 repealed an earmark on funds dedicated to the ETF while also making a new appropriation of those funds to pay for tax credits for donations to scholarship-granting organizations. Because, as we discuss infra, Section 8 does not make an "appropriation," the circuit court erred in concluding that the AAA violated the single-subject requirement in Sections 8 and 9. However, the plaintiffs have also argued that the AAA violated the single-subject requirement of §§ 45 and 71 because, they argue, the school-flexibility contracts in Sections 5-7 are a separate subject from the tax-credit programs in Sections 8 and 9, as set out in Count III of their complaint.
The plaintiffs argue that Sections 5-7 create a mechanism by which public schools can enter into contracts with the State to obtain exemptions from certain state regulations and that these sections contain nothing about tax credits, private schools, scholarship-granting organizations, or assistance to parents of students who transfer from public to nonpublic schools. They argue that the two tax-credit programs in Sections 8 and 9 do nothing to advance or impact and that they have no relevancy to the local school-flexibility contracts. The plaintiffs contend that the circuit court was correct in rejecting the argument that the single subject of the AAA was "education" based on Opinion of the Justices No. 323, 512 So.2d 72 (Ala.1987).
In Opinion of the Justices No. 323, the Court was asked for its opinion on the constitutionality of a bill that would provide appropriations for public educational purposes generally and, more specifically, for the elementary and secondary schools of the State; for junior and technical colleges; for colleges and universities; for various other State agencies; and for entities that are not State agencies, but some of which, at least arguably, serve educational purposes. The constitutional provisions at issue were § 45, which requires that bills, except for general appropriation bills, contain only one subject, and § 71, which restricts the contents of general appropriation bills. The Court explained that the bill was not a general appropriation bill. The general appropriation bill that is exempt from the single-subject requirement under § 45 and shall embrace nothing but appropriations for the ordinary expenses of the "executive, legislative, and judicial departments, ... and for public schools" under § 71 cannot be bifurcated. The Court explained that another reason the bill was not a general appropriations bill was because the Court had held that "public schools," as that term is used in § 45, includes only elementary and secondary schools. Because the bill at issue included technical schools, junior colleges, and universities, then the bill was not a general appropriations bill. The Court
The Court, in discussing whether the title of the bill clearly contained only one subject, acknowledged that the appropriations for public education would be a very broad subject. The Court also acknowledged that a statute may have a very broad subject with numerous provisions and still comply with the single-subject provisions of the Constitution so long as those provisions relate to the same subject. The Court went on to explain the history of how Alabama progressed to the point where a separate appropriation bill for public education is much larger than the general appropriation bill and why the general appropriation bill no longer appropriates money for public schools. 512 So.2d at 76-77. The Court concluded that appropriations for public education have been treated as a single subject since 1927,
512 So.2d at 77. However, the Court went on to hold that the bill violated § 45 and § 73 (appropriations to charitable or educational institutions not under the absolute control of the State) because some of the appropriations for "public education" were to "non-State agencies." 512 So.2d at 78. The Court opined that the appropriations to the non-State agencies should be eliminated. The Court also noted that whether appropriations to State agencies for education purposes, such as an appropriation to the State health department for immunization of schoolchildren, would have to wait for a later determination because the description in the bill was too general.
We recognize that the Court in Opinion of the Justice No. 323 opined that part of the education appropriation bill violated § 45 because it made appropriations to non-State agencies. We also recognize that the Court concluded that because public-education funding had been treated as a separate bill for so long the bill complied with § 45 because it put the public and the legislature on notice of the content of the education appropriation bill. However, as discussed infra, the AAA does not involve any "appropriations," and the single-subject at issue in the AAA is education reform through accountability. This Court recognized in Bagby Elevator & Electric Co. v. McBride, 292 Ala. 191, 195-96, 291 So.2d 306, 310 (1974), that, if the subject is stated in broad terms, then naturally a broader range of provisions will relate to the subject.
The plaintiffs contend that the flexibility contracts to allow for creativity and innovation in schools are unrelated to tax credits and scholarships that do not help public schools and do nothing to reform education or make failing schools more accountable because they contend the tax credits will negatively impact public schools. The State defendants contend that providing parents and students with additional educational options is education reform, just as is allowing local school systems "struggling to improve academic outcomes and close the achievement gap" to enter into flexibility contracts. The State defendants argue that giving parents additional educational options will make failing schools, i.e., ones "struggling to improve academic outcomes," more accountable to parents and that those schools will need to improve in order to get off of the State's list of
"`[A] statute has but one subject, no matter to how many different matters it relates if they are all cognate, and but different branches of the same subject.'" Ex parte Hilsabeck, 477 So.2d 472, 475 (Ala.1985) (quoting Knight v. West Alabama Envtl. Improvement Auth., 287 Ala. 15, 22, 246 So.2d 903, 908 (1971)).
Alabama State Fed'n of Labor v. McAdory, 246 Ala. 1, 10, 18 So.2d 810, 816 (1944)(quoting State v. Henry, 224 Ala. 224, 227, 139 So. 278, 281 (1931)(emphasis added)). We cannot say that the means by which the legislature chose to embrace education reform and accountability — through flexibility contracts and tax credits — did not attain the end. The parties disagree as to the effect the tax credits will have on education; this alone, however, does not indicate that the school-flexibility contracts address a different subject than the provisions in Sections 8 and 9 creating the tax-credit programs. The purpose of the single-subject requirements is not to resolve such a disagreement. Accordingly, the AAA does not violate the single-subject requirements of §§ 45 and 71.
The plaintiffs have presented a constitutional challenge to the tax-credit provisions of the AAA. Section 8 and Section 9 of the AAA are now codified at § 16-6D-1 et seq. Section 16-6D-8(a)(1)(formerly a part of Section 8) of the AAA provides a refundable Alabama income-tax credit "to the parent of a student enrolled in or assigned to attend a failing school to help offset the cost of transferring the student to a nonfailing public school or nonpublic school of the parent's choice." The income-tax credit is an amount equal to 80% of the "average annual state cost of attendance" for a public K-12 student during the relevant tax year or the actual cost of attending a nonfailing public school or nonpublic school, whichever is less. § 16-6D-8(a)(1).
Section 16-6D-9(a)(2)(formerly a part of Section 9) of the AAA also creates a scholarship program whereby individual taxpayers may claim a tax credit up to certain limits for total contributions made to scholarship-granting organizations who, in turn, provide educational scholarships to students attending a failing school so that those students may attend a nonfailing public or nonpublic school. Section 16-6D-9(a)(3) further authorizes tax credits to be claimed by corporate taxpayers up to certain limits for contributions made to scholarship-granting organizations. The AAA imposes various administrative accountability and academic standards upon the scholarship-granting organizations.
The plaintiffs alleged in Count VI of their complaint that the tax-credit provisions of the AAA violate Art. IV, § 73, of the Alabama Constitution of 1901. Section 73 provides that
The plaintiffs asserted in their complaint that the AAA appropriates funds from the ETF to finance the tax credits provided for by § 16-6D-8(a)(2)(formerly a part of Section 8) of the AAA and made available to the parents of students attending failing schools, in order to "reimburse [those parents for] tuition and fees paid to nonpublic schools, which by the statute's own definition are `not under the jurisdiction of the State Superintendent of Education and the State Board of Education.'" The plaintiffs alleged that "[b]y appropriating public funds in this manner, the AAA effectively provides for an appropriation to educational institutions that are not under the absolute control of the State." The plaintiffs also asserted that the income-tax credit found in §§ 16-6D-9(a)(2) and (3), which provides a tax credit to those individuals and corporations that have made a contribution to a scholarship-granting organization, "channel[ed] to charitable organizations monies that otherwise would have gone to the public [and] is the functional equivalent, in all respects, of an appropriation to such charitable institutions that are not under the absolute control of the State." The plaintiffs alleged that because the AAA provides for appropriations to educational and charitable institutions that are not under the absolute control of the State, and because those appropriations were not approved by a two-thirds vote of all members of each house, the AAA violates § 73.
In its order, the circuit court found that the tax-credit provisions of the AAA constituted a prohibited appropriation to a charitable or educational institution in contravention of § 73. Specifically, the circuit court stated:
Thus, the circuit court concluded that the tax credits violated § 73 because the credits had the practical effect of being an "appropriation" of public funds to nonpublic educational institutions. The circuit court reasoned that the tax credits prevented the State from collecting income-tax revenues that it would have otherwise been entitled to collect had it not been for the tax credits.
The State defendants argue on appeal that the circuit court erred in concluding that §§ 16-6D-8 and -9 constitute unconstitutional appropriations because, they say, the tax credits found in the AAA do not "appropriate" public funds for the benefit of non-State charitable or educational institutions. The State defendants contend that the Alabama Constitution expressly recognizes that "appropriations" relate to "money in the state treasury" and cannot be construed to include tax credits.
"`We are cognizant that the long-settled and fundamental rule binding this Court in construing provisions of the constitution is adherence to the plain meaning of the text.'" Town of Gurley v. M & N Materials, Inc., 143 So.3d 1, 13 (Ala.2012) (quoting Jefferson Cnty. v. Weissman, 69 So.3d 827, 834 (Ala.2011)). "`[T]he Constitution is not to have a narrow or technical construction, but must be understood and enforced according to the plain, common-sense meaning of its terms.'" Houston Cnty. Econ. Dev. Auth. v. State, 168 So.3d 4, 18 (Ala.2014) (quoting Hagan v. Commissioner's Court of Limestone Cnty., 160 Ala. 544, 554, 49 So. 417, 420 (1909)). "`"In construing a constitutional provision, the courts have no right to broaden the meaning of words used and, likewise, have no right to restrict the meaning of those words."' This Court is "not at liberty to disregard or restrict the plain meaning of the provisions of the Constitution."'" City of Bessemer v. McClain, 957 So.2d 1061, 1092 (Ala.2006) (quoting City of Birmingham v. City of Vestavia Hills, 654 So.2d 532, 538 (Ala. 1995), quoting in turn McGee v. Borom, 341 So.2d 141, 143 (Ala.1976)).
Traditional definitions of "appropriations" do not extend to include tax credits. Appropriations have been defined as "[t]he act by which the legislative department of government designates a particular fund,
In contrast to an appropriation, a tax credit has been defined as "[a]n amount subtracted directly from one's total tax liability, dollar for dollar, as opposed to a deduction from gross income." Black's Law Dictionary 1689 (10th ed.2014); Toney, supra; see also Gilligan v. Attorney General 413 Mass. 14, 17, 595 N.E.2d 288, 291 (1992) (holding that the "proposed tax credits did not set aside monies in the treasury and, thus, could not be viewed as an appropriation").
Article XI, § 213, of the Alabama Constitution of 1901, provides, in part, as follows:
Article IV, § 71, of the Alabama Constitution of 1901, involving certain restrictions on the general appropriations bill, relates only to legislative appropriations from the State treasury. State v. Street, 117 Ala. 203, 23 So. 807 (1898). Additionally, "[n]o money shall be paid out by the treasury except upon appropriations made by law, and on warrant drawn by the proper officer in pursuance thereof." Art. IV, § 72, Ala. Const. 1901. "All appropriations are paid out of revenue." Opinion of the Justices No. 78, 249 Ala. 389, 390, 31 So.2d 558, 559 (1947) (addressing whether a proposed bill had to originate in the House). Clearly, the aforementioned provisions of the Alabama Constitution expressly contemplate appropriations being directly related to moneys in the State treasury because it is those public funds that would ultimately satisfy the particular designated appropriation. Additionally, nothing in the plain text of § 73 defines an appropriation as relating to or including a tax credit. Furthermore, nothing in § 73 can be read as indicating that its drafters intended the term "appropriations" to be construed in a manner to include tax credits.
The State defendants also contend that the tax credits do not violate § 73 because,
In Alabama Education Ass'n v. James, 373 So.2d 1076 (Ala.1979), the Alabama Education Association ("the AEA") and others challenged the constitutionality of the Alabama Student Grant Program. The Student Grant Program established a student-assistance program that provided state-tuition grants to eligible students seeking a postsecondary education. Unlike the AAA, the student-grant program did not provide tax credits to the students' parents. Rather, the student-grant program paid the tuition grants directly to postsecondary institutions on behalf of the eligible students. The act establishing the student-grant program, among other things, prohibited the use of grants for sectarian purposes and prohibited the use of money raised for the support of public schools to support schools of a predominantly sectarian or denominational character.
Nonetheless, the AEA and other plaintiffs sought injunctive and declaratory relief, arguing that the act violated, among other things, Art. XIV, § 263 of the Alabama Constitution of 1901, which provides: "No money raised for the support of the public schools shall be appropriated to or used for the support of any sectarian or denominational school." The plaintiffs in James also alleged that the act failed to receive the two-thirds vote of each house as required by § 73 for appropriations to charitable or educational institutions not under the control of the State. Following a hearing, the trial court entered an order, among other things, dismissing the AEA as a plaintiff for lack of standing and declaring that the act was constitutional on its face. Id.
On appeal, this Court concluded that the act did not violate § 263 because (1) the act did not appropriate any money;
The reasoning applied by this Court in disposing of the § 263 claim in James is likewise applicable to this case. Article IV, § 73, provides that "[n]o appropriation shall be made to any charitable or educational institution not under the absolute control of the state." The tax credits provided by the AAA are even further removed from State involvement than the grant program upheld against a constitutional challenge in James, because, unlike the grant program at issue in James, the State does not pay money directly to the educational institution. Rather, in the case of the refundable tax credit provided by § 16-6D-8, the tax credit is paid to the parents of a child who transfers from a failing public school to a nonfailing public school or nonpublic school for the purpose of offsetting any expenses incurred by the student's transfer. Thus, no money is set aside or specified from the public revenue or treasury to be applied to a charitable or educational institution. Toney, supra, McAlpine, supra. We recognize that the tax credits provided by 16-6D-8 are paid out of sales-tax collections made to the ETF. Nevertheless, the tax credits are
Likewise, in the case of the tax credit provided by § 16-6D-9(a)(2)(formerly a part of Section 9) to individual taxpayers for contributions made to scholarship-granting organizations, no appropriations are made to any charitable or educational institution. Rather, monetary contributions are made to scholarship-granting organizations by the taxpayer; those organizations, in turn, grant educational scholarships based on certain prescribed criteria to students attending a failing school so that those students may attend a nonfailing public or nonpublic school. The individual taxpayer then may claim a tax credit in an amount equal to the total contribution made to the scholarship-granting organization. Again, no money is set aside or specified from the public revenue or treasury to be applied to a charitable or educational institution. Toney, supra, McAlpine, supra. Thus, there is no appropriation made to charitable or educational institution. The individual taxpayer simply receives a tax credit — as that term has traditionally been defined — for monetary contributions made to a scholarship-granting organization.
Other courts have rejected the "tax credit as a de facto appropriation approach" argued by the plaintiffs and adopted by the circuit court in this case. In Kotterman v. Killian, 193 Ariz. 273, 972 P.2d 606 (1999), the plaintiffs challenged the constitutionality of an Arizona law that allowed a state tax credit of up to $500 for those who chose to donate to school-tuition organizations (similar to scholarship-granting organizations) that, in turn, used the donated funds to offer scholarships to students to attend nongovernmental primary or secondary schools. The plaintiffs contended, among other things, that the tax credit violated the Arizona state constitution because it channeled public money to private and sectarian schools. The Arizona Supreme Court rejected this argument, holding that the tax credit did not constitute an appropriation:
Kotterman, 193 Ariz. at 285, 972 P.2d at 618. The court went further and expressly rejected the rationale offered by the plaintiffs in this case and relied upon by the circuit court, i.e., that tax credits are public funds because, but for the tax-credit provisions of the AAA, the State would have collected and deposited the income-tax revenues into the State treasury:
Kotterman, 193 Ariz. at 285, 972 P.2d at 618 (footnote omitted). See also Arizona Christian Sch. Tuition Org. v. Winn, 563 U.S. 125, 131 S.Ct. 1436, 1447, 179 L.Ed.2d 523 (2011)(stating that "[w]hen Arizona taxpayers choose to contribute to [student-tuition organizations], they spend their own money, not money the State has collected from ... taxpayers").
In Toney, supra, the plaintiffs brought a declaratory-judgment action challenging the constitutionality of a law that permitted an income-tax credit up to $500 against income-tax liability equal to 25% of qualified education expenses incurred by students attending K-12 at any public or private school. The plaintiffs argued, among other things, that the credit reduced the state's annual revenue and had the practical effect of being a legislative appropriation. The trial court entered an order denying the plaintiffs' motion for a summary judgment, holding: (1) that the money accruing from the credit was not public money and (2) that the credit did not provide support for sectarian schools, reasoning that the money is not public until it belongs to the state and the fact that a state allows individual taxpayers to keep more of their own money does not make the money kept the state's money.
In affirming the trial court's order denying the plaintiffs' motion for a summary judgment, the Toney court stated:
Toney, 318 Ill.App.3d at 1198-1200, 744 N.E.2d at 357-358, 253 Ill.Dec. at 75-76.
In Griffith v. Bower, 319 Ill.App.3d 993, 747 N.E.2d 423, 254 Ill.Dec. 383 (2001), the plaintiffs brought a subsequent challenge to the Illinois income-tax credit, alleging that the tax credit had the effect of giving aid to children in religious schools that is not likewise given to children in public schools in violation of the Illinois Constitution. As part of their argument, the plaintiffs contended that a tax credit was an expenditure; therefore, they asserted, the support of religious education through tax credits is an appropriation or payment of public funds for sectarian purposes. The trial court dismissed the plaintiffs' action.
On appeal, the Illinois appellate court, as it did in Toney, supra, rejected the plaintiffs' argument that the tax credit was in the nature of an appropriation stating:
Griffith, 319 Ill.App.3d at 995-996, 747 N.E.2d at 426, 254 Ill.Dec. at 386.
Based on the foregoing, we conclude that the circuit court's construction of the term "appropriation" to include the tax credits provided by AAA is contrary to the Alabama Constitution, existing caselaw, and the commonly accepted definition of the term appropriation.
The plaintiffs alleged in Count VII of their complaint that the tax credit provided by § 16-6D-9 (formerly Section 9) of the AAA violates Art. XI, § 211.02(B)(2), of the Alabama Constitution of 1901 (Off. Recomp.), which provides, in part, that "all net proceeds" of the state income tax, after deducting certain amounts for purposes described in § 211.02(B)(1), "shall be placed in the state treasury to the credit of the Alabama special education trust fund to be used for the payment of public school teachers salaries only." The plaintiffs asserted in Count VII that by providing an income-tax credit to reimburse 100% of the amount contributed by a taxpayer to a scholarship-granting organization, § 16-6D-9 redirects income-tax revenue that
In determining that § 16-6D-9 of the AAA violated § 211.02(B)(2), the circuit court stated:
The State defendants argue that the AAA tax credits do not use income-tax proceeds for purposes other than the payment of public-school-teacher salaries. Specifically, the State defendants contend that, although the tax credits provided by § 16-6D-9 do reduce the amount of revenue entering the State treasury, they do not constitute "net proceeds" and in no way redirect any revenue already held in the State treasury to any purpose other than paying public-school-teacher salaries. We agree.
The phrase "all net proceeds" of the state income tax is not defined in § 211.02. "Gross Proceeds" has been defined as "`[t]he entire proceeds[;] [t]he proceeds of a sale or of a collection without deduction for cost, commissions, or any other expenses whatsoever.'" Lee v. BSB Greenwich Mortg. Ltd. P'ship, 267 F.3d 172, 179 (2d Cir.2001) (quoting Ballentine's Law Dictionary 537 (3d ed.1969)). This Court has defined "net proceeds" as "`[g]ross proceeds, less charges which may be rightly deducted.'" Opinion of the Justices No. 385, 69 So.3d 847, 856 (Ala.2011)(quoting Black's Law Dictionary 1041 (6th ed.1990)). In Opinion of the Justices No. 385, this Court considered whether a Senate bill, which, as part of an economic-development plan, allowed certain qualified employers to retain a percentage of state income taxes withheld from the pay of eligible employees, violated § 211.02 of the Alabama Constitution. In determining that the Senate bill did violate § 211.02, this Court stated:
69 So.3d at 858. Central to this Court's conclusion that the Senate bill at issue in Opinion of the Justices No. 385 violated § 211.02 was the fact that the Senate bill contemplated an income tax actually being collected by the State through the employer acting as the agent
Based on the foregoing, we conclude that the tax credit provided by § 16-6D-9 does not violate § 211.02 of the Alabama Constitution of 1901.
The plaintiffs, in Count VIII of their complaint, alleged that the refundable tax credit provided by Section 8 was unconstitutional because, they say, it violates § 213, which provides, in part, that "[a]ny act creating or incurring any new debt against the state, except as herein provided, shall be absolutely void." Specifically, the plaintiffs alleged that § 16-6D-8 of the AAA "creates a new obligation that binds the State annually to make payments to taxpayers, whether in the form of refunds, rebates, or credits to help fund the cost of sending children to a nonfailing public school or [a] nonpublic school." The plaintiffs further alleged that the AAA pledges funds from existing revenue streams to satisfy this new obligation of the State without placing a limit on the total amount of money the State would be obligated to pay the taxpayers each year.
In determining that the refundable tax credit provided by Section 8 of the AAA violated § 213, the circuit court stated:
The State defendants argue that Section 8 of the AAA does not create a "debt" as contemplated by § 213. We agree.
Section 16-6D-8(a)(1) provides, in part:
Section 16-6D-8(c) provides, in part, that
Initially, we note that any tax credits the State is obligated to refund pursuant to § 16-6D-8 will be refunded solely on the basis of an annual determination. Alabama
Second, a debt within the meaning of § 213 does not include obligations of the State that are contingent in nature. See Opinion of the Justices No. 381, 892 So.2d 375, 378 (Ala.2004) (holding that "Section 213 of the Alabama Constitution, as amended by Amend. No. 26, is directed toward preventing the creation of an obligation that must be paid `in any event'" and that because the interest-rate swap agreements at issue were contingent in nature, there was no "new debt" created as that phrase is defined in § 213). Here, the refund available under § 16-6D-8(a)(1) comes into play only "if [the] income taxes owed by ... a parent are less than the total credit allowed" under § 16-6D-8(a)(1). Thus, whether a parent is entitled to a refundable tax credit is contingent upon whether that parent's tax liability is less than the total credit allowed for that taxable year. Even the amount of the tax credit itself is contingent, because it is based upon the "average annual state cost of attendance for a public K-12 student during the applicable tax year or the actual cost of attending a nonfailing public school or nonpublic school, whichever is less." § 16-6D-8(a)(1). Accordingly, because the tax credit provided by § 16-6D-8 is contingent in nature, there is no new debt created within the meaning of § 213.
We now turn to the issue whether the circuit court should have addressed the plaintiffs' constitutional challenges to the AAA on religious grounds. As previously stated, the plaintiffs did not move for a judgment on the pleadings with respect to Counts IX and X (alleging that the AAA violates § 263 and § 3, respectively, of the Alabama Constitution) of their complaint because they contended that factual development would be necessary for a resolution of those claims. Counts IX and X were therefore before the circuit court only on the State defendants' motion to dismiss the entire complaint pursuant to Rule 12(b)(6), Ala. R. Civ. P., and the tax-credit parents' motion for a judgment on
In Nance v. Matthews, 622 So.2d 297, 299 (Ala.1993), this Court stated the following standard for reviewing a Rule 12(b)(6), Ala. R. Civ. P., motion to dismiss:
For the reasons discussed below, we conclude that Counts IX and X of the plaintiffs' complaint are due to be dismissed insofar as the plaintiffs will be unable to prove any set of facts that would entitle them to relief under Rule 12(b)(6). Because of this holding, there is no need to address the tax-credit parents' motion for a judgment on the pleadings. Cf. Pontius v. State Farm Mut. Auto. Ins. Co., 915 So.2d 557 (Ala.2005)(discussing the similarities and differences between Rule 12(b)(6) and Rule 12(c)).
Article XIV, § 263, of the Alabama Constitution of 1901 provides that "[n]o money raised for the support of the public schools shall be appropriated to or used for the support of any sectarian or denominational school." The plaintiffs allege in Count IX of their complaint that the tax credit provided by Section 8 of the AAA, which authorizes a refundable State income-tax credit for parents who transfer their children from a failing public school to another nonfailing public or nonpublic school of the parents' choice, violates § 263 because, they say, the tax credit diverts money from the ETF raised for the support of the public schools and appropriates that money to the support of religious schools. The plaintiffs further allege that as of August 23, 2013, 53 of the 56 nonpublic schools for which the Section 8 tax credit could be used were religious schools and that the AAA places no restrictions on the use of the funds to those religious schools. For the same reasoning previously employed in holding that nothing in the plain text of Art. IV, § 73, defines an
536 U.S. at 649-53, 122 S.Ct. 2460. See also Locke v. Davey, 540 U.S. 712, 719, 124 S.Ct. 1307, 158 L.Ed.2d 1 (2004) ("[T]he link between government funds and religious training is broken by the independent and private choice of recipients.").
The reasoning applied in Zelman is applicable in this case. To start, the AAA as a whole has a secular purpose, insofar as it aimed at improving public education by injecting additional accountability into the education system, as well as ensuring educational opportunities for children in failing public schools. The purpose of the Section 8 tax credit is to provide financial aid or assistance in the form of a refundable State income-tax credit to parents who choose to remove their child from a failing public school to offset the expenses incurred by transferring the child. Thus, the Section 8 tax-credit provision was designed for the benefit of parents and students, and not for the benefit of religious schools. The Section 8 tax-credit provision is neutral insofar as the credit is extended to a class of parents who have children in failing public schools and is extended without reference to religion. Moreover, the parents of children in a failing public school have the freedom to transfer the students to a school of their own private choice, i.e., another nonfailing public school or nonpublic school, either religious or nonreligious. For these reasons, the AAA as a whole ensures that any aid that may ultimately flow to a religious school as a result of the tax credit will do so only as a result of the private decision of individual parents rather than flowing directly from the State. There is simply no evidence that the State, in authorizing the Section 8 tax credit, has deliberately skewed incentives toward religious schools. As emphasized in Zelman, "[t]he incidental advancement of a religious mission, or the perceived endorsement of a religious message, is reasonably attributable to the individual recipient, not to the government, whose role ends with the disbursement of benefits." 536 U.S. at 652, 122 S.Ct. 2460. Because the Section 8 tax-credit provision is both neutral as to religion and is based on true private choice, the provision survives scrutiny under § 263, and the plaintiffs therefore will be unable to prove any set of facts that would entitle them to relief. Rule 12(b)(6), Ala. R. Civ. P.
The plaintiffs also allege in Count IX of their complaint that the tax credit provided in Section 9 of the AAA, which authorizes a tax credit for individuals and corporations who donate to scholarship-granting organizations violates § 263 of the Alabama Constitution because, they say, the tax credit diverts money from the ETF, which supports the public schools, and appropriates and uses that money to support religious schools. Again, as previously held, the Section 9 tax credit to a parent or a corporation under the AAA cannot be construed as an "appropriation" to a religious school; there is simply no money being set aside or specified from the public revenue or treasury to be applied to a religious school. Toney, supra, McAlpine, supra. A good analysis involving similar facts can be gathered from Arizona Christian School Tuition Organization v. Winn, supra, a case in which a group of taxpayers challenged an Arizona statute that provided dollar-for-dollar tax credits for private contributions to Student Tuition Organizations ("STOs"), which, in turn, distributed the scholarships to students
Arizona Christian, 563 U.S. at ___, 131 S.Ct. at 1447-48.
Likewise in this case, a tax credit cannot be equated to a government expenditure. When Alabama taxpayers and corporations contribute to scholarship-granting organizations, they do so by virtue of their own private funds, not funds that the State has collected from other taxpayers. As noted in Arizona Christian, "contributions yielding [scholarship-granting organization] tax credits are not owed to the State and, in fact, pass directly from taxpayers to private organizations." 563 U.S. at ___, 131 S.Ct. at 1448. "While the State, at the outset, affords the opportunity to create and contribute to [a scholarship-granting organization], the tax credit system is implemented by private action and with no state intervention." 563 U.S. at ___, 131 S.Ct. at 1448. Moreover, the Section 9
Article I, § 3, of the Alabama Constitution of 1901 provides:
(Emphasis added.)
The plaintiffs allege in Count X of their complaint that the Section 8 and Section 9 tax-credit provisions of the AAA violate Article § 3 of the Alabama Constitution because, they say, taxpayer funds are diverted to religious schools through tax credits and taxpayers are therefore compelled, through their tax payments, to pay for the building and repair of places of worship and for maintaining ministers and ministries. This argument is basically a rehash of the previous arguments that both tax-credit provisions are violative of §§ 73 and 263 of the Alabama Constitution. Our previous holdings that the tax-credit provisions of the AAA pass constitutional scrutiny under §§ 73 and 263 compel the same conclusion with respect to the plaintiffs' § 3 claim with the necessity of little, if any, additional analysis.
Section 3 of the Alabama Constitution is the counterpart of the religion clauses of the First Amendment to the United States Constitution. It is well settled that the Establishment Clause prevents a State from enacting laws that have the purpose or effect of advancing or inhibiting religion. In Locke, supra, the Supreme Court stated:
540 U.S. at 718-19, 124 S.Ct. 1307 (emphasis added).
As can be gleaned from Zelman, supra, and the cases cited therein, most of the First Amendment Establishment Clause cases that have reached the Supreme Court have involved state laws authorizing financial benefits to church-related institutions, and those cases, including Zelman, have consistently held that indirect-governmental-aid programs to religious schools do not violate the Establishment Clause where the programs are neutral with respect to religion and the decision to confer the aid rests with a private individual, as opposed to the government. In applying the principles of Zelman, we concluded that the tax-credit provisions of the AAA passed constitutional scrutiny under § 263 because the provisions were neutral insofar as they did not have the primary effect of advancing religion, and any moneys that may ultimately flow to a religious school as a result of those provisions will do so only as a result of the independent and private choice of students' parents, as opposed to the State. In other words, the State's interest in authorizing the tax credits in this case was not building or repairing places of worship or maintaining ministers and ministries. In Alabama Education Ass'n v. James, supra, it was held that the "Alabama constitutional provisions concerning the establishment of religion are not more restrictive than the Federal Establishment of Religion Clause in the First Amendment to the United States Constitution." 373 So.2d at 1081. Consequently, the tax-credit provisions of the AAA do not violate Art. I, § 3, of the Alabama Constitution, the Alabama counterpart of the religion clauses of the First Amendment to the United States Constitution. Accordingly, Count X of the plaintiffs' complaint is also due to be dismissed for failure to state a claim upon which relief can be granted. Rule 12(b)(6), Ala. R. Civ. P.
The last issue we address is the scholarship parents' postjudgment motion to intervene filed pursuant to Rule 24(a)(2) and Rule 24(b), Ala. R. Civ. P.
The denial of a motion to intervene as of right is an appealable order. State v. Estate of Yarbrough, 156 So.3d 947 (Ala.2014). Generally, a ruling on a motion to intervene is within the sound discretion of the trial court and will not be disturbed on appeal absent an abuse of that discretion. Id. Likewise, the denial of a motion for permissive intervention is an appealable order. Universal Underwriters Ins. Co. v. Anglen, 630 So.2d 441 (Ala. 1993). A motion for permissive intervention is committed to the broad discretion of the trial court and is therefore reviewed by this Court for abuse of that discretion. QBE Ins. Corp. v. Austin Co., 23 So.3d 1127, 1131 (Ala.2009).
The scholarship parents argue that the circuit court erred in denying their postjudgment motion to intervene, which they filed on May 30, 2014. They sought to intervene both as a matter of right pursuant to Rule 24(a)(2), Ala. R. Civ. P., and, in the alternative, as permissive intervenors pursuant to Rule 24(b). In affidavits attached to their motion, Rachell Prince stated that her two children had been assigned to attend a school listed as failing under the guidelines of the AAA. She said that she enrolled her children at a private school in the fall of 2013 and applied for
Rule 24(a) provides:
As noted above, the standard of review applicable in cases involving a denial of a motion to intervene as of right is whether the trial court has acted outside its discretion. City of Dora v. Beavers, 692 So.2d 808, 810 (Ala.1997). Typically, persons desiring to intervene in a civil action as of right will claim entitlement to intervention under Rule 24(a)(2), Ala. R. Civ. P., which mandates intervention upon timely application if "the applicant claims an interest relating to the property or transaction which is the subject of the action" and is "so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties." Thus, this Court has held that, under Rule 24(a)(2), the trial court has discretion to determine "whether the potential intervenor has demonstrated: (1) that its motion is timely; (2) that it has a sufficient interest relating to the property or transaction; (3) that its ability to protect its interest may, as a practical matter be impaired or impeded; and (4) that its interest is not adequately represented." City of Dora, 692 So.2d at 810. Intervention as of right under Rule 24(a) is proper only if all four requirements have been established.
Rule 24(b), Ala. R. Civ. P., provides that on a timely motion the court may permit anyone to intervene when a statute confers a conditional right to intervene or when an applicant's claim or defense and the main action share a common question of law or fact. Rule 24(b) goes on to provide that "[i]n exercising its discretion the court shall consider whether the intervention will unduly delay or prejudice the adjudication of the rights of the original parties."
In discussing the timeliness of motions to intervene, this Court has stated:
QBE Ins. Corp. v. Austin Co., 23 So.3d at 1131.
Generally, postjudgment motions to intervene are disfavored. Duncan v. First Nat'l Bank of Jasper, 573 So.2d 270, 275 (Ala.1990). The rationale behind this general principle is the assumption that allowing intervention after a judgment has been entered will prejudice the rights of the existing parties or substantially interfere with the orderly processes of the court.
With regard to the scholarship parents' motion to intervene as a matter of right, they are seeking to intervene to uphold the constitutionality of the AAA, arguing that they will not be able to keep their children enrolled in private schools if the AAA is declared unconstitutional. We cannot say that the scholarship parents' interests are not being adequately represented in this case. The United States Supreme Court, in interpreting Rule 24, Fed.R.Civ.P., provided two central principles for an adequacy-of-representation analysis.
Stone v. First Union Corp., 371 F.3d 1305, 1311 (11th Cir.2004); see also United States v. City of Miami, 278 F.3d 1174, 1178-79 (11th Cir.2002)(finding that the United States of America's interest in bringing the employment-discrimination suit against the city was identical to a police officers' association); Athens Lumber Co. v. FEC, 690 F.2d 1364, 1367 (11th Cir.1982)(denying intervention because both the machinists' union and the Federal Election Commission "have precisely the same objective" in upholding the constitutionality of a provision of the Federal Elections Campaign Act).
The State defendants have argued for the constitutionality of the AAA, including making arguments that the scholarship program set out in Section 9 is constitutional. Additionally, the scholarship parents' own counsel have filed briefs and argued the constitutionality of the AAA on behalf of the tax-credit parents. The scholarship parents argue that they have a separate interest from that of the tax-credit parents in that they are relying on scholarships instead of tax credits to send their children to private school. However, the scholarship parents stated in their postjudgment motion to intervene that they would not be presenting any new claims or legal defenses. As indicated earlier, failure to meet one of the requirements of intervention as of right is fatal to the motion to intervene. We also question the timeliness of the scholarship parents' motion, where the motion was filed at least three months after they knew they had received scholarships and there is absolutely no indication that they were unaware of the litigation challenging the constitutionality of the AAA. There may also be a question as to whether the scholarship parents have shown that their rights will be impaired based on the information before the circuit court. The scholarship parents sought intervention to argue for the constitutionality of the AAA so that their children can remain in private schools for the 2014-2015 school year and beyond. The scholarship parents make no argument that they will have to refund the scholarship money they received for the 2013-2014 school year. Furthermore, the scholarship parents did not address the applicable scholarship-granting organization's requirements for reapplying for scholarships, e.g., how income status is confirmed from year to year, or whether there are enough funds to pay for scholarships from year to year, or whether any subjectivity is involved. Accordingly, we cannot say the circuit court exceeded its discretion in denying the scholarship parents' motion to intervene as of right.
With regard to permissive intervention, we cannot say the circuit court exceeded its broad discretion in denying
Based on the foregoing, we cannot say that the circuit court exceeded its discretion in denying the scholarship parents' motion to intervene.
The plaintiffs challenged the constitutionality of the AAA on several grounds. Following the enactment of the AAA on February 28, 2013, no subsequent act of the legislature rendered any of the plaintiffs' procedural challenges moot. The plaintiffs' procedural challenges to the AAA did not fall into the realm of nonjusticiable political questions implicating separation-of-powers concerns. Instead, the plaintiffs' allegations of procedural infirmities in the enactment process of the AAA did not implicate a lack of respect due the legislative branch of government, but acknowledged the constitutional responsibility of this Court as the final arbiter of State constitutional disputes. In addressing the merits of the plaintiffs' constitutional challenges, we hold as follows: (1) that the AAA did not violate the original-purpose requirement of the Alabama Constitution because the substitute bill did not change the general purpose of the HB 84, the original bill; (2) that the AAA did not violate the three-readings requirement of the Alabama Constitution because the substitute bill was germane to and not inconsistent with the general purpose of the original bill so that the substitute bill did not have to be read three times on three different days; (3) that the AAA did not violate the single-subject requirements of the Alabama Constitution simply because the legislature embraced education reform and accountability through making school-flexibility contracts available to underachieving schools and providing tax credits for parents whose children attend failing schools and the AAA did not violate the single-subject requirements by including the tax-credit programs because the tax-credit programs do not involve an appropriation; (4) that the AAA did not violate the prohibition against appropriating money to non-State charitable or educational institutions because "appropriations" are directly related to moneys in the State treasury because it is those public funds that would ultimately satisfy the particular appropriation, whereas the tax-credit programs did not involve moneys that are ever collected by the State or available to the legislature for appropriation; (5) that the AAA also did not violate the prohibition
Based on the foregoing, the judgment of the circuit court is affirmed in part and reversed in part and the case is remanded for proceedings consistent with this opinion. The order denying the scholarship parents' motion to intervene is affirmed.
1130987 — AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
MOORE, C.J., and STUART, PARKER, MAIN, and WISE, JJ., concur.
SHAW and BRYAN, JJ., concur in part and concur in the result.
MURDOCK, J., dissents.
1131020 — AFFIRMED.
MOORE, C.J., and STUART, PARKER, MURDOCK, SHAW, MAIN, WISE, and BRYAN, JJ., concur.
1131021 — AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
MOORE, C.J., and STUART, PARKER, MAIN, and WISE, JJ., concur.
SHAW and BRYAN, JJ., concur in part and concur in the result.
MURDOCK, J., dissents.
SHAW, Justice (concurring in part and concurring in the result in case nos. 1130987 and 1131021).
I concur as to Parts III, V, VI, VII, and VIII. For the reasons discussed below, I concur in the result as to Parts I, II, IV, IX, and X. I also concur to affirm the trial court's denial of the motion to intervene filed by the scholarship parents.
Part I holds that the later legislative developments could not cure any procedural defects in the passage of House Bill 84. Because the main opinion holds that there
I also concur in the result as to Parts II and IV. I agree that an analysis concerning whether the passage of House Bill 84 violated Ala. Const.1901, Art. IV, §§ 61 and 45, does not present a political question. However, I have serious concerns as to whether compliance with the three-readings requirement of § 63 might present such a nonjusticiable issue. The plain language of this section merely requires that a bill be read on three different days in each house of the legislature. This is a purely procedural requirement, and Ala. Const.1901, Art. IV, § 53, vests the legislature with the power to determine the rules of its proceedings. What it means to properly read a bill is a matter within the inherent and internal decision-making process of the legislature, and the Alabama Constitution places no limit on the legislature's authority with respect to compliance with this portion of § 63. My concern is that a determination of whether a bill was properly read under § 63 is no different than a determination of whether, as also required by the section, a bill received a majority vote of each house, which this Court held in Birmingham-Jefferson Civic Center Authority v. City of Birmingham, 912 So.2d 204 (Ala.2005), to be a nonjusticiable political question. Here, however, House Bill 84 was actually read three times in each house, which is all the face of § 63 requires. Therefore, I hesitate to examine the issue any further.
I express no opinion as to Parts IX and X, addressing counts IX and X in the complaint, which still remain pending in the trial court.
BRYAN, Justice (concurring in part and concurring in the result in case nos. 1130987 and 1131021).
I concur in all aspects of the main opinion, except for Parts II and IV, as to which I concur in the result.
MURDOCK, Justice (dissenting in case nos. 1130987 and 1131021).
It appears to me that House Bill 84 was amended to serve a different "purpose" (albeit within the general "subject" of improving education) than that which characterized the bill as originally introduced and thereby violates Art. IV, § 61, Ala. Const. 1901. As a corollary, it also appears to me that the "three-readings" requirement of Art. IV, § 63, of the Alabama Constitution was not met. In addition, to the extent that the Alabama Accountability Act provides for the payment of funds to parents in excess of the parents' tax liabilities, I am concerned that it does so under conditions
To establish the Local Control School Flexibility Act of 2013, relating to public K-12 education; to authorize the establishment of innovative schools and school systems in the state; to provide legislative findings and purposes; to provide an overview; to authorize the State Board of Education to enter into school flexibility contracts with local school systems; to require the local board of education to submit a document of assurance; to require the State Board of Education to promulgate rules and regulations relating to innovative school systems; to require local school systems to submit an innovation plan to the State Department of Education in order to qualify for innovation status; and to provide for an effective date.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. This act shall be known and may be cited as the Local Control School Flexibility Act of 2013.
Section 2. (a) Innovative schools and school systems may be established in Alabama in accordance with this act.
(b) The purpose of this act is to advance the benefits of local school and school system autonomy in innovation and creativity by allowing flexibility from state laws, regulations, and policies.
Section 3. (a) The Legislature finds and declares all of the following:
(1) To further the goals of public education throughout the state, each school system should be able to have maximum possible flexibility to meet the needs of students and the communities within its jurisdiction.
(2) There is a critical need for innovative models of public education that are tailored to the unique circumstances and needs of the students in all schools and communities, and especially in schools and communities that are struggling to improve academic outcomes and close the achievement gap.
(3) To better serve students and better use available resources, local boards of education and local school systems need the ability to explore flexible alternatives in an effort to be more efficient and effective in providing operational and programmatic services.
(b) Therefore, it is the intent of the Legislature to do all of the following:
(1) Allow school systems greater flexibility in meeting the educational needs of a diverse student population.
(2) Improve educational performance through greater individual school autonomy and managerial flexibility with regard to programs and budgetary matters.
(3) Encourage innovation in education by providing local school systems and school administrators with greater control over decisions including, but not limited to, budgetary matters, staffing, personnel, scheduling, and educational programming, including curriculum and instruction.
Section 4. For the purposes of this act, the following terms shall have the following meanings:
(1) FLEXIBILITY CONTRACT. A school flexibility contract between the local
(2) INNOVATION PLAN. The request of a local school system for flexibility and plan for annual accountability measures and five-year targets for all participating schools within the school system.
(3) LOCAL BOARD OF EDUCATION. A city or county board of education that exercises management and control of a local school system pursuant to state law.
(4) LOCAL SCHOOL SYSTEM. A public agency that establishes and supervises one or more public schools within its geographical limits pursuant to state law.
(5) SCHOOL ADMINISTRATOR. A local superintendent of education or local school principal, unless otherwise specified.
Section 5. (a) Pursuant to this act, to be considered as an innovative school system, a local school system shall successfully comply with the requirements and procedures set forth by the State Department of Education regarding school flexibility contracts, which include, but are not limited to:
(1) Submission to the State Department of Education of a letter of intent to pursue a school flexibility contract.
(2) Submission to the State Department of Education of a resolution adopted by the local board of education supporting the intent of the local school system to pursue a school flexibility contract.
(3) Submission to the State Department of Education of a document of assurance stating that the local board of education shall provide consistency in leadership and a commitment to state standards, assessments, and academic rigor.
(4) Submission to the State Board of Education of a resolution adopted by the local board of education supporting the flexibility contract proposal and the anticipated timeline of the local school system.
(b) Pursuant to State Board of Education rules, each local school system shall provide an opportunity for full discussion and public input, including a public hearing, before submitting a school flexibility contract proposal to the State Board of Education.
(c) A local school system shall ensure that its school flexibility contract proposal and innovation plan is easily accessible to the general public on the website of the local school system.
Section 6. (a) The innovation plan of a local school system shall include, at a minimum, all of the following:
(1) The school year that the local school system expects the school flexibility contract to begin.
(2) The list of state laws, regulations, and policies, including rules, regulations, and policies promulgated by the State Board of Education and the State Department of Education, that the local school system is seeking to waive in its school flexibility contract.
(3) A list of schools included in the innovation plan of the local school system.
(b) A local school system is accountable to the state for the performance of all schools in its system, including innovative schools, under state and federal accountability requirements.
(c) A local school system may not, pursuant to this act, waive requirements imposed by federal law, requirements related to the health and safety of students participation in a the state retirement system or state health insurance plan, or requirements imposed by Section 16-13-231, Code of Alabama 1975. This act may not be construed to allow a local school system to compensate a current employee at an annual rate that is less than the amount the current employee local school system to compensate an employee at an annual amount that is less than the amount the employee would otherwise be afforded through the State Minimum Salary Schedule included in the annual Education Trust Fund Appropriations Act in force at the time. Additionally, this act may not be construed to allow a local school system to require any employee or future employee who attains tenure or nonprobationary status to involuntarily relinquish any rights or privileges acquired by that employee as a result of attaining tenure or nonprobationary status under the Students First Act.
No provision of this act shall be construed or shall be used to authorize the formation of a charter school.
(d) Nothing in this act shall be construed to prohibit the approval of a flexibility contract that gives potential, current, or future employees the option to voluntarily waive any rights or privileges already acquired or that could potentially be acquired as a result of attaining tenure or nonprobationary status, provided, however, that any employee provided this option is also provided the option of retaining or potentially obtaining any rights or privileges provided under the Students First Act, Chapter 24C of Title 16, Code of Alabama 1975.
(d) (e) The State Department of Education shall finalize all school data and the local school system shall seek approval of the local board of education before final submission to the State Department of Education and the State Board of Education.
(e) (f) The final innovation plan, as recommended by the local superintendent of education and approved by the local board of education, shall accompany the formal submission of the local school system to the State Department of Education.
(f) (g) Within 60 days of receiving the final submission, the State Superintendent of Education shall decide whether or not the school flexibility contract and the innovation plan should be approved. If the State Superintendent of Education denies a school flexibility contract and innovation plan, he or she shall provide a written explanation for his or her decision to the local board of education. Likewise, a written letter of approval by the State Superintendent of Education shall be provided to the local board of education that submitted the final school flexibility contract and innovation plan.
(f) (g) (h) The State Board of Education shall promulgate any necessary rules and regulations required to implement this act including, but not limited to, all of the following:
(1) The specification of timelines for submission and approval of the innovation plan and school flexibility contract of a local school system.
(2) An authorization for the State Department of Education, upon approval by the State Board of Education after periodic review, to revoke a school flexibility
(3) An outline of procedures and necessary steps that a local school system shall follow, upon denial of an original submission, to amend and resubmit an innovation plan and school flexibility contract for approval.
Section 7. The State Board of Education and the State Department of Education shall ensure equal opportunity for all school systems that apply for programmatic flexibility or budgetary flexibility, or both, as delineated in this act, and in no way shall one local school system be favored over another local school system based upon its size, location, student population, or any other possible discriminatory measure.
Section 8. This act shall become effective immediately following its passage and approval by the Governor, or its otherwise becoming law.
ENROLLED, An Act,
To establish the Alabama Accountability Act of 2013, relating to public K-12 education; to authorize the establishment of innovative schools and school systems in the state; to provide legislative findings and purposes; to provide an overview; to authorize the State Board of Education to enter into school flexibility contracts with local school systems; to require the local board of education to submit a document of assurance; to require the State Board of Education to promulgate rules and regulations relating to innovative school systems; to require local school systems to submit an innovation plan to the State Department of Education in order to qualify for innovation status; to provide an income tax credit to any parent who transfers a student enrolled in or assigned to attend a failing public K-12 school to a nonfailing public school or nonpublic school of the parent's choice; to limit the income tax credit to 80 percent of the average annual state cost of attendance; to create within the Education Trust Fund the Failing Schools Income Tax Credit Account; and to authorize the Comptroller to annually transfer into the account proceeds from sales tax revenues in an amount sufficient for the Department of Revenue to pay the income tax credits; to authorize a tax credit for contributions to organizations that provide educational scholarships to qualifying schools; to provide for the responsibilities of scholarship organizations; to provide for oversight of participating schools; to provide for the responsibilities of the Department of Revenue; and to provide for an effective date.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. This act shall be known and may be cited as the Alabama Accountability Act of 2013.
Section 2. (a) Innovative schools and school systems may be established in Alabama in accordance with this act.
(b) The purpose of this act is to advance the benefits of local school and school system autonomy in innovation and creativity by allowing flexibility from state laws, regulations, and policies.
Section 3. (a) The Legislature finds and declares all of the following:
(1) To further the goals of public education throughout the state, each school system should be able to have maximum possible flexibility to meet the needs of students and the communities within its jurisdiction.
(2) There is a critical need for innovative models of public education that are
(3) To better serve students and better use available resources, local boards of education, local school systems, and parents need the ability to explore flexible alternatives in an effort to be more efficient and effective in providing operational and programmatic services.
(b) Therefore, it is the intent of the Legislature to do all of the following:
(1) Allow school systems greater flexibility in meeting the educational needs of a diverse student population.
(2) Improve educational performance through greater individual school autonomy and managerial flexibility with regard to programs and budgetary matters.
(3) Encourage innovation in education by providing local school systems and school administrators with greater control over decisions including, but not limited to, budgetary matters, staffing, personnel, scheduling, and educational programming, including curriculum and instruction.
(4) Provide financial assistance through an income tax credit to a parent who transfers a student from a failing public school to a nonfailing public school or non-public school of the parent's choice.
Section 4. For the purposes of this act, the following terms shall have the following meanings:
(1) EDUCATIONAL SCHOLARSHIPS. Grants to any qualifying school to cover all or part of the tuition and fees at the school for an eligible student.
(2) ELIGIBLE STUDENT. A student who satisfies all of the following:
a. Is a member of a household whose total annual income the year before he or she receives an educational scholarship under this program does not exceed an amount equal to 150 percent of the median household income. Once a student receives an educational scholarship under this program, the student shall remain eligible regardless of household income until the student graduates high school or reaches 19 years of age.
b. Was eligible to attend a public school in the preceding semester or is starting school in Alabama for the first time.
c. Resides in Alabama while receiving an educational scholarship.
(3) FAILING SCHOOL. A public K-12 school that is labeled as persistently low-performing by the State Department of Education, in the then most recent United States Department of Education School Improvement Grant application; that is listed in the lowest ten percent of public K-12 schools on the state standardized assessment in reading and math; that has earned a grade of "F" or three consecutive grades of "D" pursuant to Section 16-6C-2, Code of Alabama 1975; or that is designated a failing school by the State Superintendent of Education.
(4) FLEXIBILITY CONTRACT. A school flexibility contract between the local school system and the State Board of Education wherein a local school system may apply for programmatic flexibility or budgetary flexibility, or both, from state laws, regulations, and policies, including regulations and policies promulgated by the State Board of Education and the State Department of Education.
(5) INNOVATION PLAN. The request of a local school system for flexibility and plan for annual accountability measures
(6) LOCAL BOARD OF EDUCATION. A city or county board of education that exercises management and control of a local school system pursuant to state law.
(7) LOCAL SCHOOL SYSTEM. A public agency that establishes and supervises one or more public schools within its geographical limits pursuant to state law.
(8) LOW-INCOME ELIGIBLE STUDENT. A student of a family with income less than two times the federal poverty level.
(9) NONPUBLIC SCHOOL. Any non-public or private school, including parochial schools, not under the jurisdiction of the State Superintendent of Education and the State Board of Education, providing educational services to children. A non-public school is accredited by a state recognized accrediting agency that provides education to elementary or secondary, or both, students and has notified the State Department of Revenue of its intention to participate in the scholarship program and comply with the requirements of the scholarship program. A nonpublic school does not include home schooling.
(10) PARENT. The parent or legal guardian of a student, with authority to act on behalf of the student, who claims the student as a dependent on his or her federal income tax return.
(11) QUALIFYING SCHOOL. Either a public school outside of the resident school district that is not considered failing under either state or federal standards or any nonpublic school as defined in this act or that satisfies the compulsory attendance requirements provided in Section 16-28-7, Code of Alabama 1975. A qualified non-public school shall be accredited by one of the six regional accrediting agencies or, if not so accredited, shall satisfy all of the following conditions:
a. Be in existence for at least three years.
b. Have daily attendance of at least 85 percent over a two-year period.
c. Have a minimum 180-day school year, or its hourly equivalent.
d. Have a day length of at least six and one-half hours.
e. Require all students to take the Stanford Achievement Test, or its equivalent.
f. Require all candidates for graduation to take the American College Test before graduation.
g. Require students in high school in grades nine through 12 to earn a minimum of 24 Carnegie credits before graduating, including 16 credits in core subjects and additional requirements in health and physical education, fine arts, computer studies, and foreign language.
h. Not subject special education students to the same testing or curricular requirements as regular education students if it is not required in the individual plan for the student.
i. Maintain a current website that describes the school and the instructional program of the school.
j. Annually affirm on forms prescribed by the scholarship granting organization and the department its status financially and academically and provide other relative information as required by the scholarship granting organization or as otherwise required in this act.
(12) SCHOLARSHIP GRANTING ORGANIZATION. An organization that provides or is approved to provide educational scholarships to students attending qualifying schools of their parents' choice.
Section 5. (a) Pursuant to this act, to be considered as an innovative school system, a local school system shall successfully comply with the requirements and procedures set forth by the State Department of Education regarding school flexibility contracts, which include, but are not limited to:
(1) Submission to the State Department of Education of a letter of intent to pursue a school flexibility contract.
(2) Submission to the State Department of Education of a resolution adopted by the local board of education supporting the intent of the local school system to pursue a school flexibility contract.
(3) Submission to the State Department of Education of a document of assurance stating that the local board of education shall provide consistency in leadership and a commitment to state standards, assessments, and academic rigor.
(4) Submission to the State Board of Education of a resolution adopted by the local board of education supporting the flexibility contract proposal and the anticipated timeline of the local school system.
(b) Pursuant to State Board of Education rules, each local school system shall provide an opportunity for full discussion and public input, including a public hearing, before submitting a school flexibility contract proposal to the State Board of Education.
(c) A local school system shall ensure that its school flexibility contract proposal and innovation plan is easily accessible to the general public on the website of the local school system.
Section. 6. (a) The innovation plan of a local school system shall include, at a minimum, all of the following:
(1) The school year that the local school system expects the school flexibility contract to begin.
(2) The list of state laws, regulations, and policies, including rules, regulations, and policies promulgated by the State Board of Education and the State Department of Education, that the local school system is seeking to waive in its school flexibility contract.
(3) A list of schools included in the innovation plan of the local school system.
(b) A local school system is accountable to the state for the performance of all schools in its system, including innovative schools, under state and federal accountability requirements.
(c) A local school system may not, pursuant to this act, waive requirements imposed by federal law, requirements related to the health and safety of students or employees, requirements imposed by ethics laws, requirements imposed by the Alabama Child Protection Act of 1999, Chapter 22A, Title 16, Code of Alabama 1975, requirements imposed by open records or open meetings laws, requirements related to financial or academic reporting or transparency, requirements designed to protect the civil rights of students or employees, requirements related to the state retirement system or state health insurance plan, or requirements imposed by Act 2012-482. This act may not be construed to allow a local school system to compensate an employee at an annual amount that is less than the amount the employee would otherwise be afforded through the State Minimum Salary Schedule included in the annual Education Trust Fund Appropriations Act. No local school system shall involuntarily remove any rights or
(d) No provision of this act shall be construed or shall be used to authorize the formation of a charter school.
(e) Any provision of subsection (c) to the contrary notwithstanding, nothing in this act shall be construed to prohibit the approval of a flexibility contract that gives potential, current, or future employees of a failing school within the local school system the option to voluntarily waive any rights or privileges already acquired or that could potentially be acquired as a result of attaining tenure or nonprobationary status, provided, however, that any employee provided this option is also provided the option of retaining or potentially obtaining any rights or privileges provided under the Students First Act, Chapter 24C of Title 16, Code of Alabama 1975.
(f) The State Department of Education shall finalize all school data and the local school system shall seek approval of the local board of education before final submission to the State Department of Education and the State Board of Education.
(g) The final innovation plan, as recommended by the local superintendent of education and approved by the local board of education, shall accompany the formal submission of the local school system to the State Department of Education.
(h) Within 60 days of receiving the final submission, the State Superintendent of Education shall decide whether or not the school flexibility contract and the innovation plan should be approved. If the State Superintendent of Education denies a school flexibility contract and innovation plan, he or she shall provide a written explanation for his or her decision to the local board of education. Likewise, a written letter of approval by the State Superintendent of Education shall be provided to the local board of education that submitted the final school flexibility contract and innovation plan.
(i) The State Board of Education shall promulgate any necessary rules and regulations required to implement this act including, but not limited to, all of the following:
(1) The specification of timelines for submission and approval of the innovation plan and school flexibility contract of a local school system.
(2) An authorization for the State Department of Education, upon approval by the State Board of Education after periodic review, to revoke a school flexibility contract for noncompliance or nonperformance, or both, by a local school system.
(3) An outline of procedures and necessary steps that a local school system shall follow, upon denial of an original submission, to amend and resubmit an innovation plan and school flexibility contract for approval.
Section 7. The State Board of Education and the State Department of Education shall ensure equal opportunity for all school systems that apply for programmatic flexibility or budgetary flexibility, or both, as delineated in this act, and in no way shall one local school system be favored over another local school system based upon its size, location, student population, or any other possible discriminatory measure.
(1) For tax years beginning on and after January 1, 2013, an Alabama income tax credit is made available to the parent of a student enrolled in or assigned to attend a failing school to help offset the cost of transferring the student to a nonfailing public school or nonpublic school of the parent's choice. The income tax credit shall be an amount equal to 80 percent of the average annual state cost of attendance for a public K-12 student during the applicable tax year or the actual cost of attending a nonfailing public school or nonpublic school, whichever is less. A parent is allowed a credit against income tax for each taxable year under the terms established in this section. If income taxes owed by the parent are less than the total credit allowed under this subsection, the taxpayer shall be entitled to a refund or rebate, as the case may be, equal to the balance of the unused credit with respect to that taxable year.
(2) Any income tax credit due a parent under this section shall be granted or issued to the parent only upon his or her making application therefor, at such time and in such manner as may be prescribed from time to time by the Department of Revenue. The application process shall include, but not be limited to, certification by the parent that the student was enrolled in or was assigned to attend a failing school, certification by the parent that the student was subsequently transferred to, and was enrolled and attended, a nonfailing public school or nonpublic school of the parent's choice, and proof, satisfactory to the Department of Revenue, of the actual cost of attendance for the student at the nonfailing public school or nonpublic school. The Department of Revenue shall also prescribe the various methods by which income tax credits are to be issued to taxpayers. Income tax credits authorized by this section shall be paid out of sales tax collections made to the Education Trust Fund, and set aside by the Comptroller in the Failing School Tax Credit Account created in subsection (c), in the same manner as refunds of income tax otherwise provided by law, and there is hereby appropriated therefrom, for such purpose, so much as may be necessary to annually pay the income tax credits provided by this section.
(3) An application for an income tax credit authorized by this section shall be filed with the Department of Revenue within the time prescribed for filing petitions for refund under Section 40-2A-7, Code of Alabama 1975.
(4) The Department of Revenue shall promulgate reasonable rules to effectuate the intent of this section.
(b)(1) The parent of a public school student may request and receive an income tax credit pursuant to this section to reimburse the parent for costs associated with transferring the student from a failing school to a nonfailing public school or nonpublic school of the parent's choice, in any of the following circumstances:
a. By assigned school attendance area, if the student spent the prior school year in attendance at a failing school and the attendance of the student occurred during a school year in which the designation was in effect.
b. The student was in attendance elsewhere in the Alabama public school system and was assigned to a failing school for the next school year.
c. The student was notified that he or she was assigned to a failing school for the next school year.
(3) For the purposes of continuity of educational choice, the tax credit shall be available to parents for those grade levels of the failing school from which the student transferred. The parent of a student who transfers from a failing school may receive income tax credits for those grade levels enrolled in and attended in the nonfailing public school or nonpublic school of the parent's choice transferred to that were included in the failing school from which the student transferred, whether or not the failing school becomes a nonfailing school during those years. The student shall return to his or her original local school system of attendance when he or she completes the highest grade level of the failing school transferred from in the nonfailing public school or nonpublic school of the parent's choice. If the public school the student returns to is a failing school, the parent may again transfer the student to a nonfailing public school or nonpublic school of the parent's choice and request and receive an income tax credit as provided in this section.
(4) A local school system, for each student enrolled in or assigned to a failing school, shall do all of the following:
a. Timely notify the parent of the student of all options available under this section as soon as the school of attendance is designated as a failing school.
b. Offer the parent of the student an opportunity to enroll the student in another public school within the local school system that is not a failing school or a failing school to which the student has been assigned.
(5) The parent of a student enrolled in or assigned to a school that has been designated as a failing school, as an alternative to paragraph b. of subdivision (4), may choose to enroll the student in and transport the student to a nonfailing public school that has available space in any other local school system in the state, and that local school system is willing to accept the student on whatever terms and conditions the system establishes and report the student for purposes of the local school system's funding pursuant to the Foundation Program.
(6) For students in the local school system who are participating in the tax credit program, the local school system shall provide locations and times to take all statewide assessments required by law.
(7) Students with disabilities who are eligible to receive services from the local school system under federal or state law, and who participate in the tax credit program, remain eligible to receive services from the local school system as provided by federal or state law.
(8) If a parent requests that the student be enrolled in a nonfailing public school within the same local school system, transportation costs to the nonfailing public school shall be the responsibility of the local school system.
(9) The State Department of Education shall promulgate reasonable rules to effectuate the intent of this section. Rules shall include penalties for noncompliance.
(c) There is created within the Education Trust Fund a separate account named the Failing Schools Income Tax Credit Account. The Commissioner of Revenue shall annually certify to the Comptroller the amount of income tax credits due to parents under this section and the Comptroller shall transfer into the Failing Schools Income Tax Credit Account only the amount from sales tax revenues within the Education Trust Fund that
Section 9. (a)(1) A taxpayer who files a state income tax return and is not a dependent of another taxpayer may claim a credit for a contribution made to a scholarship granting organization.
(2) The tax credit may be claimed by an individual taxpayer or a married couple filing jointly in an amount equal to the total contributions made to a scholarship granting organization for educational scholarships during the taxable year for which the credit is claimed up to 50 percent of the tax liability of the taxpayer, not to exceed seven thousand five hundred dollars ($7,500) per taxpayer or married couple filing jointly.
(3) The tax credit may be claimed by a corporate taxpayer in an amount equal to 50 percent of the total contributions made to a scholarship granting organization for educational scholarships during the taxable year for which the credit is claimed up to 50 percent of the tax liability of the taxpayer. The cumulative amount of tax credits issued pursuant to subdivision (2) and this subdivision shall not exceed twenty-five million dollars ($25,000,000) annually. The Department of Revenue shall develop a procedure to ensure that this cap is not exceeded and shall also prescribe the various methods by which these credits are to be issued.
(4) A corporate taxpayer, an individual taxpayer, or a married couple filing jointly may carry forward a tax credit under the tax credit scholarship program for three years.
(b)(1) Administrative accountability standards. All scholarship granting organizations shall do all of the following:
a. Notify the Department of Revenue of their intent to provide educational scholarships.
b. Demonstrate to the Department of Revenue that they have been granted exemption from the federal income tax as an organization described in Section 501(c)(3) of the Internal Revenue Code.
c. Distribute periodic educational scholarship payments as checks made out and mailed to the school where the student is enrolled.
d. Provide a Department of Revenue approved receipt to taxpayers for contributions made to the scholarship granting organization.
e. Ensure that at least 95 percent of their revenue from donations is spent on educational scholarships, and that all revenue from interest or investments is spent on educational scholarships.
f. Spend each year a portion of their expenditures on educational scholarships for low-income eligible students equal to the percentage of low-income eligible students in the county where the scholarship granting organization expends the majority of its educational scholarships.
g. Ensure that at least 75 percent of first-time recipients of educational scholarships were not continuously enrolled in a private school during the previous year.
h. Cooperate with the Department of Revenue to conduct criminal background checks on all of their employees and board members and exclude from employment or governance any individual who may reasonably pose a risk to the appropriate use of contributed funds.
i. Ensure that educational scholarships are portable during the school year and
j. Publicly report to the Department of Revenue by June 1 of each year all of the following information prepared by a certified public accountant regarding their grants in the previous calendar year:
1. The name and address of the scholarship granting organization.
2. The total number and total dollar amount of contributions received during the previous calendar year.
3. The total number and total dollar amount of educational scholarships awarded during the previous calendar year, the total number and total dollar amount of educational scholarships awarded during the previous year for students qualifying for the federal free and reduced-price lunch program, and the percentage of first-time recipients of educational scholarships who were enrolled in a public school during the previous year.
k. Ensure educational scholarships are not provided for students to attend a school with paid staff or board members, or relatives thereof, in common with the scholarship granting organization.
l. Ensure that scholarships are provided in a manner that does not discriminate based on the gender, race, or disability status of the scholarship applicant or his or her parent.
m. Ensure that educational scholarships are provided only to students who would otherwise attend a failing school so that the student can attend a nonpublic school or a nonfailing public school.
(2) Financial accountability standards.
a. All scholarship granting organizations shall demonstrate their financial accountability by doing all of the following:
1. Annually submitting to the Department of Revenue a financial information report for the scholarship granting organization that complies with uniform financial accounting standards established by the Department of Revenue and conducted by a certified public accountant.
2. Having the auditor certify that the report is free of material misstatements.
b. All participating nonpublic schools shall demonstrate financial viability, if they are to receive donations of fifty thousand dollars ($50,000) or more during the school year, by doing either of the following:
1. Filing with the scholarship granting organization before the start of the school year a surety bond payable to the scholarship granting organization in an amount equal to the aggregate amount of contributions expected to be received during the school year.
2. Filing with the scholarship granting organization before the start of the school year financial information that demonstrates the financial viability of the participating nonpublic school.
(c)(1) Each scholarship granting organization shall collect written verification from participating nonpublic schools that accept its educational scholarship students that those schools do all of the following:
a. Comply with all health and safety laws or codes that otherwise apply to nonpublic schools.
b. Hold a valid occupancy permit if required by the municipality.
c. Certify compliance with nondiscrimination policies set forth in 42 USC 1981.
d. Conduct criminal background checks on employees and then do all of the following:
2. Exclude from employment any person who may reasonably pose a threat to the safety of students.
(2) Academic accountability standards. There shall be sufficient information about the academic impact educational scholarship tax credits have on participating students in order to allow parents and taxpayers to measure the achievements of the tax credit scholarship program, and therefore:
a. Each scholarship granting organization shall ensure that participating schools that accept its educational scholarship shall do all of the following:
1. Annually administer either the state achievement tests or nationally recognized norm-referenced tests that measure learning gains in math and language arts to all participating students in grades that require testing under the accountability testing laws of the state for public schools.
2. Allow costs of the testing requirements to be covered by the educational scholarships distributed by the scholarship granting organizations.
3. Provide the parents of each student who was tested with a copy of the results of the tests on an annual basis, beginning with the first year of testing.
4. Provide the test results to the Department of Revenue or an organization chosen by the state on an annual basis, beginning with the first year of testing.
5. Report student information that allows the state to aggregate data by grade level, gender, family income level, and race.
6. Provide graduation rates of those students benefitting from education scholarships to the Department of Revenue or an organization chosen by the state in a manner consistent with nationally recognized standards.
b. The Department of Revenue or an organization chosen by the Department of Revenue shall do all of the following:
1. Ensure compliance with all student privacy laws.
2. Collect all test results.
3. Provide the test results and associated learning gains to the public via a state website after the third year of test and test-related data collection. The findings shall be aggregated by the grade level, gender, family income level, number of years of participation in the tax credit scholarship program, and race of the student.
(d)(1) The Department of Revenue shall adopt rules and procedures consistent with this section as necessary to implement the tax credit scholarship program.
(2) The Department of Revenue shall provide a standardized format for a receipt to be issued by a scholarship granting organization to a taxpayer to indicate the value of a contribution received. The Department of Revenue shall require a taxpayer to provide a copy of the receipt when claiming the tax credit pursuant to this section.
(3) The Department of Revenue shall provide a standardized format for a scholarship granting organization to report the information required in paragraph j. of subdivision (1) of subsection (b).
(4) The Department of Revenue may conduct either a financial review or audit of a scholarship granting organization if possessing evidence of fraud.
(5) The Department of Revenue may bar a scholarship granting organization from participating in the tax credit scholarship program if the Department of Revenue
(6) If the Department of Revenue decides to bar a scholarship granting organization from the tax credit scholarship program, the Department of Revenue shall notify affected educational scholarship students and their parents of the decision as quickly as possible.
(7) The Department of Revenue shall publish and routinely update, on the website of the department, a list of scholarship granting organizations in the state, by county.
(e)(1) All schools participating in the tax credit scholarship program shall be required to operate in Alabama.
(2) All schools participating in the tax credit scholarship program shall comply with all state laws that apply to public schools regarding criminal background checks for employees and exclude from employment any person not permitted by state law to work in a public school.
(f) The tax credit provided in this section may be first claimed for the 2013 tax year.
Section 10. The provisions of this act are severable. If any part of this act is declared invalid or unconstitutional, that declaration shall not affect the part which remains.
Section 11. This act shall become effective immediately following its passage and approval by the Governor, or its otherwise becoming law.
ENROLLED, An Act,
To amend Sections 4, 5, 8, and 9 of the Alabama Accountability Act of 2013, Act 2013-64, 2013 Regular Session (Acts 2013); to revise definitions; to further limit what may be contained in a school flexibility contract; to provide for the calculation of tax credits for parents of students enrolled in or assigned to attend a failing school; to provide for the retention of certain funds by a failing school; to provide for treatment of students with disabilities; to provide no public or nonpublic school would be required to enroll a student; to prohibit discrimination; to revise the tax credit for corporate donors to scholarship programs; to provide for retroactive effect; and to further provide for the manner of payment of scholarships.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Sections 4, 5, 8, and 9 of the Alabama Accountability Act of 2013, Act 2013-64, 2013 Regular Session (Acts 2013), are amended to read as follows:
"Section 4. For the purposes of this act, the following terms shall have the following meanings:
"(1) EDUCATIONAL SCHOLARSHIPS. Grants made by a scholarship granting organization to any qualifying school to cover all or part of the tuition and mandatory fees charged by a at the qualifying school for to an eligible student receiving a scholarship.
"(2) ELIGIBLE STUDENT. A student who satisfies all of the following:
"a. Is a member of a household whose total annual income the year before he or she receives an educational scholarship under this program does not exceed an amount equal to 150 percent of the median household income. Once a student receives an educational scholarship under this program, the student shall remain eligible regardless of household income until
"b. Was eligible to attend a public school in the preceding semester or is starting school in Alabama for the first time.
"c. Resides in Alabama while receiving an educational scholarship.
"(3) FAILING SCHOOL. A public K-12 school (i) that is labeled as persistently low-performing by the State Department of Education, in the then most recent United States Department of Education School Improvement Grant application; (ii) that is designated as a failing school by the State Superintendent of Education; or (iii) that does not exclusively serve a special population of students and, until June 1, 2017, is has been listed three or more times during the then-most recent six years in the lowest ten six percent of public K-12 schools on the state standardized assessment in reading and math or, on or after June 1, 2017, that has, during the then-most recent three years, earned at least one a grade of "F" or, during the then-most recent four years, earned at least three consecutive grades of "D" on the school grading system developed pursuant to Section 16-6C-2, Code of Alabama 1975, or that is designated a failing school by the State Superintendent of Education. In the event sufficient rules required to implement the grading system provided for by Section 16-6C-2, Code of Alabama 1975, have not been implemented pursuant to the Alabama Administrative Procedure Act in time to provide a sufficient record to implement this subdivision by June 1, 2017, then a failing school shall be a school that has been listed in the lowest 10 percent of public K-12 schools in the state standardized assessment in reading and math.
"(4) FLEXIBILITY CONTRACT. A school flexibility contract between the local school system and the State Board of Education wherein a local school system may apply for programmatic flexibility or budgetary flexibility, or both, from state laws, regulations, and policies, including regulations and policies promulgated by the State Board of Education and the State Department of Education.
"(5) INNOVATION PLAN. The request of a local school system for flexibility and plan for annual accountability measures and five-year targets for all participating schools within the school system.
"(6) LOCAL BOARD OF EDUCATION. A city or county board of education that exercises management and control of a local school system pursuant to state law.
"(7) LOCAL SCHOOL SYSTEM. A public agency that establishes and supervises one or more public schools within its geographical limits pursuant to state law.
"(8) LOW-INCOME ELIGIBLE STUDENT. A student of a family with income equal to or less than two times the federal poverty level.
"(9) NONPUBLIC SCHOOL. Any nonpublic or private school, including parochial schools, not under the jurisdiction of the State Superintendent of Education and the State Board of Education, providing educational services to children. A nonpublic school is accredited by a state recognized accrediting agency that provides education to elementary or secondary, or both, students and has notified the State Department of Revenue of its intention to participate in the scholarship program and comply with the requirements of the scholarship program. A nonpublic school does not include home schooling.
"(10) PARENT. The parent or legal guardian of a student, with authority to act federal Alabama state income tax return.
"(11) QUALIFYING SCHOOL. Either a public school outside of the resident school district that is not considered failing under either state or federal standards or any nonpublic school as defined in this act or that satisfies the compulsory attendance requirements provided in Section 16-28-7, Code of Alabama 1975. A qualified nonpublic school shall be accredited by one of the six regional accrediting agencies or, if not so accredited, shall satisfy that satisfies all of the following conditions:
"a. Be Has been in existence for at least three years.
"b. Have Has daily attendance of at least 85 percent over a two-year period.
"c. Have Has a minimum 180-day school year, or its hourly equivalent.
"d. Have Has a day length of at least six and one-half hours.
"e. Require Requires all students to take the Stanford Achievement Test, or its equivalent.
"f. Require Requires all candidates for graduation to take the American College Test before graduation.
"g. Require Requires students in high school in grades nine through 12 to earn a minimum of 24 Carnegie credits before graduating, including 16 credits in core subjects and additional requirements in health and physical education, fine arts, computer studies, and foreign language.
"h. Not Does not subject special education students to the same testing or curricular requirements as regular education students if it is not required in the individual plan for the student.
"i. Maintain Maintains a current website that describes the school and the instructional program of the school.
"j. Annually affirm affirms on forms prescribed by the scholarship granting organization and the department its status financially and academically and provide other relative information as required by the scholarship granting organization or as otherwise required in this act.
"(12) SCHOLARSHIP GRANTING ORGANIZATION. An organization that provides or is approved to provide educational scholarships to students attending qualifying schools of their parents' choice.
"(13) SCHOOL ADMINISTRATOR. A local superintendent of education or local school principal, unless otherwise specified.
"Section 5. (a) Pursuant to this act, to be considered as an innovative school system, a local school system shall successfully comply with the requirements and procedures set forth by the State Department of Education regarding school flexibility contracts, which include, but are not limited to:
"(1) Submission to the State Department of Education of a letter of intent to pursue a school flexibility contract.
"(2) Submission to the State Department of Education of a resolution adopted by the local board of education supporting the intent of the local school system to pursue a school flexibility contract.
"(3) Submission to the State Department of Education of a document of assurance stating that the local board of education shall provide consistency in leadership and a commitment to state standards, assessments, and academic rigor.
"(4) Submission to the State Board of Education of a resolution adopted by the local board of education supporting the
"(b) Pursuant to State Board of Education rules, each local school system shall provide an opportunity for full discussion and public input, including a public hearing, before submitting a school flexibility contract proposal to the State Board of Education.
"(c) A local school system shall ensure that its school flexibility contract proposal and innovation plan is easily accessible to the general public on the website of the local school system.
"(d) No school flexibility contract proposal or innovation plan shall be used to allow the collection or dissemination of data in a manner that violates the privacy rights of any student or employee.
"Section 8. (a) To provide educational flexibility and state accountability for students in failing schools:
"(1) For tax years beginning on and after January 1, 2013, an Alabama income tax credit is made available to the parent of a student enrolled in or assigned to attend a failing school to help offset the cost of transferring the student to a nonfailing public school or nonpublic school of the parent's choice. The income tax credit shall be an amount equal to 80 percent of the average annual state cost of attendance for a public K-12 student during the applicable tax year or the actual cost of attending a nonfailing public school or nonpublic school, whichever is less. The actual cost of attending a nonfailing public school or nonpublic school shall be calculated by adding together any tuition amounts or mandatory fees charged by the school to the student as a condition of enrolling or of maintaining enrollment in the school. The average annual state cost of attendance for a public K-12 student shall be calculated by dividing the state funds appropriated to the Foundation Program pursuant to Section 16-13-231(b)(2) by the total statewide number of pupils in average daily membership during the first 20 scholastic days following Labor Day of the preceding school year. For each student who was enrolled in and attended a failing school the previous semester whose parent receives an income tax credit under this section, an amount equal to 20 percent of the average annual state cost of attendance for a public K-12 student during the applicable tax year shall be allocated, for as long as the parent receives the tax credit, to the failing school from which the student transferred if the student transfers to and remains enrolled in a nonpublic school. No such allocation shall be made in the event the student transfers to or enrolls in a nonfailing public school. The Department of Education shall determine the best method of ensuring that the foregoing allocation provisions are properly implemented. A parent is allowed a credit against income tax for each taxable year under the terms established in this section. If income taxes owed by the such a parent are less than the total credit allowed under this subsection, the taxpayer shall be entitled to a refund or rebate, as the case may be, equal to the balance of the unused credit with respect to that taxable year.
"(2) Any income tax credit due a parent under this section shall be granted or issued to the parent only upon his or her making application therefor, at such time and in such manner as may be prescribed from time to time by the Department of Revenue. The application process shall include, but not be limited to, certification by the parent that the student was enrolled in or was assigned to attend a failing school, certification by the parent that the student was subsequently transferred to, School Schools Income Tax Credit Account created in subsection (c), in the same manner as refunds of income tax otherwise provided by law, and there is hereby appropriated therefrom, for such purpose, so much as may be necessary to annually pay the income tax credits provided by this section.
"(3) An application for an income tax credit authorized by this section shall be filed with the Department of Revenue within the time prescribed for filing petitions for refund under Section 40-2A-7, Code of Alabama 1975.
"(4) The Department of Revenue shall promulgate reasonable rules to effectuate the intent of this section subsection.
"(b)(1) The parent of a public school student may request and receive an income tax credit pursuant to this section to reimburse the parent for costs associated with transferring the student from a failing school to a nonfailing public school or nonpublic school of the parent's choice, in any of the following circumstances:
"a. By assigned school attendance area, if the student spent the prior school year in attendance at a failing school and the attendance of the student occurred during a school year in which the designation was in effect.
"b. The student was in attendance elsewhere in the Alabama public school system and was assigned to a failing school for the next school year.
"c. The student was notified that he or she was assigned to a failing school for the next school year.
"(2) This section does not apply to a student who is enrolled in the Department of Youth Services School District.
"(3) For the purposes of continuity of educational choice, the tax credit shall be available to parents for those grade levels of the failing school from which the student transferred. The parent of a student who transfers from a failing school may receive income tax credits for those grade levels enrolled in and attended in the nonfailing public school or nonpublic school of the parent's choice transferred to that were included in the failing school from which the student transferred, whether or not the failing school becomes a nonfailing school during those years. The parent of such a student shall no longer be eligible for the income tax credit return to his or her original local school system of attendance when he or she after the student completes the highest grade level in which he or she would otherwise have been enrolled at of the failing school transferred from in the nonfailing public school or nonpublic school of the parent's choice. Notwithstanding the foregoing, as long as the student remains enrolled in or assigned to attend a failing school If the public school the student returns to is a failing school, the parent may again transfer the student to a nonfailing public school or nonpublic school of the parent's choice and request and receive an income tax credit as provided in this section.
"a. Timely notify the parent of the student of all options available under this section as soon as the school of attendance is designated as a failing school.
"b. Offer the parent of the student an opportunity to enroll the student in another public school within the local school system that is not a failing school or a failing school to which the student has been assigned.
"(5) The parent of a student enrolled in or assigned to a school that has been designated as a failing school, as an alternative to paragraph b. of subdivision (4), may choose to enroll the student in and transport the student to a who decides to transfer the student to a nonfailing public school, shall first attempt to enroll the student in a nonfailing public school within the same local system in which the student is already enrolled or assigned to attend before attempting to enroll the student in a nonfailing public school that has available space in any other local school system in the state, and that, A local school system is willing to may accept the student on whatever terms and conditions the system establishes and report the student for purposes of the local school system's funding pursuant to the Foundation Program.
"(6) For students in the local school system who are participating in the tax credit program, the local school system shall provide locations and times to take all statewide assessments required by law.
"(7) Students with disabilities who are eligible to receive services from the local school system under federal or state law, and who participate in the tax credit program, remain eligible to receive services from the local school system as provided by federal or state law.
"(8) If a parent requests that the student be enrolled enrolls a student in a nonfailing public school within the same local school system, and that system provides transportation services for other enrolled students, transportation costs to the nonfailing public school shall be the responsibility of the local school system. Local school systems may negotiate transportation options with a parent to minimize system costs. If a parent enrolls a student in a nonpublic school or in a nonfailing public school within another local school system, regardless of whether that system provides transportation services for other enrolled students, transportation of the student shall be the responsibility of the parent.
"(9) The State Department of Education shall promulgate reasonable rules to effectuate the intent of this sub section. Rules shall include penalties for noncompliance.
"(c) There is created within the Education Trust Fund a separate account named the Failing Schools Income Tax Credit Account. The Commissioner of Revenue shall annually certify to the Comptroller the amount of income tax credits due to parents under this section and the Comptroller shall transfer into the Failing Schools Income Tax Credit Account only the amount from sales tax revenues within the Education Trust Fund that is sufficient for the Department of Revenue to use to cover the income tax credits for the applicable tax year. The Commissioner of Revenue shall annually distribute the funds in the Failing Schools Income Tax Credit Account to parents pursuant to this section.
"(d) (1) Nothing in this section or act shall be construed to force any public school, school system, or school district or
"(2) A public school, school system, or school district or any nonpublic school, school system, or school district may develop the terms and conditions under which it will allow a student whose parent receives an income tax credit pursuant to this section to be enrolled, but such terms and conditions may not discriminate on the basis of the race, gender, religion, color, disability status, or ethnicity of the student or of the student's parent.
"(3) Nothing in this section shall be construed to authorize the violation of or supersede the authority of any court ruling that applies to the public school, school system, or school district, specifically any federal court order related to the desegregation of the local school system's student population.
"Section 9. (a)(1) A taxpayer who files a state income tax return and is not a dependent of another taxpayer may claim a credit for a contribution made to a scholarship granting organization.
"(2) The tax credit may be claimed by an individual taxpayer or a married couple filing jointly in an amount equal to the total contributions made to a scholarship granting organization for educational scholarships during the taxable year for which the credit is claimed up to 50 percent of the tax liability of the taxpayer, not to exceed seven thousand five hundred dollars ($7,500) per taxpayer or married couple filing jointly.
"(3) The tax credit may be claimed by a corporate taxpayer in an amount equal to 50 100 percent of the total contributions made to a scholarship granting organization for educational scholarships during the taxable year for which the credit is claimed up to 50 percent of the tax liability of the taxpayer. The cumulative amount of tax credits issued pursuant to subdivision (2) and this subdivision shall not exceed twenty-five million dollars ($25,000,000) annually. The Department of Revenue shall develop a procedure to ensure that this cap is not exceeded and shall also prescribe the various methods by which these credits are to be issued.
"(4) A corporate taxpayer, an individual taxpayer, or a married couple filing jointly may carry forward a tax credit under the tax credit scholarship program for three years.
"(b)(1) Administrative accountability standards. All scholarship granting organizations shall do all of the following:
"a. Notify the Department of Revenue of their intent to provide educational scholarships.
"b. Demonstrate to the Department of Revenue that they have been granted exemption from the federal income tax as an organization described in Section 501(c)(3) of the Internal Revenue Code.
"c. Distribute periodic educational scholarship payments as checks made out and mailed to the school where the student is enrolled.
"d. Provide a Department of Revenue approved receipt to taxpayers for contributions made to the scholarship granting organization.
"e. Ensure that at least 95 percent of their revenue from donations is spent on educational scholarships, and that all revenue from interest or investments is spent on educational scholarships.
"f. Spend each year a portion of their expenditures on educational scholarships for low-income eligible students equal to the percentage of low-income eligible students in the county where the scholarship
"g. Ensure that at least 75 percent of first-time recipients of educational scholarships were not continuously enrolled in a private school during the previous year.
"h. Cooperate with the Department of Revenue to conduct criminal background checks on all of their employees and board members and exclude from employment or governance any individual who may reasonably pose a risk to the appropriate use of contributed funds.
"i. Ensure that educational scholarships are portable during the school year and can be used at any qualifying school that accepts the eligible student according to the wishes of the parent. If a student transfers to another qualifying school during a school year, the educational scholarship amount may be prorated.
"j. Publicly report to the Department of Revenue by June 1 of each year all of the following information prepared by a certified public accountant regarding their grants in the previous calendar year:
"1. The name and address of the scholarship granting organization.
"2. The total number and total dollar amount of contributions received during the previous calendar year.
"3. The total number and total dollar amount of educational scholarships awarded during the previous calendar year, the total number and total dollar amount of educational scholarships awarded during the previous year for students qualifying for the federal free and reduced-price lunch program, and the percentage of first-time recipients of educational scholarships who were enrolled in a public school during the previous year.
"k. Ensure educational scholarships are not provided for students to attend a school with paid staff or board members, or relatives thereof, in common with the scholarship granting organization.
"l. Ensure that scholarships are provided in a manner that does not discriminate based on the gender, race, or disability status of the scholarship applicant or his or her parent.
"m. Ensure that educational scholarships are provided only to students who would otherwise attend a failing school so that the student can attend a nonpublic school or a nonfailing public school. Provided, however, that any scholarship funds unaccounted for on September 15th of each year may be made available to low-income eligible students to defray the costs of attending a qualifying school, whether or not the student is assigned to a failing school.
"n. Ensure that no donations are directly made to benefit specifically designated scholarship recipients.
"(2) Financial accountability standards.
"a. All scholarship granting organizations shall demonstrate their financial accountability by doing all of the following:
"1. Annually submitting to the Department of Revenue a financial information report for the scholarship granting organization that complies with uniform financial accounting standards established by the Department of Revenue and conducted by a certified public accountant.
"2. Having the auditor certify that the report is free of material misstatements.
"b. All participating nonpublic schools shall demonstrate financial viability, if they are to receive donations of fifty thousand dollars ($50,000) or more during the school year, by doing either of the following:
"2. Filing with the scholarship granting organization before the start of the school year financial information that demonstrates the financial viability of the participating nonpublic school.
"(c)(1) Each scholarship granting organization shall collect written verification from participating nonpublic schools that accept its educational scholarship students that those schools do all of the following:
"a. Comply with all health and safety laws or codes that otherwise apply to nonpublic schools.
"b. Hold a valid occupancy permit if required by the municipality.
"c. Certify compliance with nondiscrimination policies set forth in 42 USC 1981.
"d. Conduct criminal background checks on employees and then do all of the following:
"1. Exclude from employment any person not permitted by state law to work in a public school.
"2. Exclude from employment any person who may reasonably pose a threat to the safety of students.
"(2) Academic accountability standards. There shall be sufficient information about the academic impact educational scholarship tax credits have on participating students in order to allow parents and taxpayers to measure the achievements of the tax credit scholarship program, and therefore:
"a. Each scholarship granting organization shall ensure that participating schools that accept its educational scholarship shall do all of the following:
"1. Annually administer either the state achievement tests or nationally recognized norm-referenced tests that measure learning gains in math and language arts to all participating students in grades that require testing under the accountability testing laws of the state for public schools.
"2. Allow costs of the testing requirements to be covered by the educational scholarships distributed by the scholarship granting organizations.
"3. Provide the parents of each student who was tested with a copy of the results of the tests on an annual basis, beginning with the first year of testing.
"4. Provide the test results to the Department of Revenue or an organization chosen by the state on an annual basis, beginning with the first year of testing.
"5. Report student information that allows the state to aggregate data by grade level, gender, family income level, and race.
"6. Provide graduation rates of those students benefitting from education scholarships to the Department of Revenue or an organization chosen by the state in a manner consistent with nationally recognized standards.
"b. The Department of Revenue or an organization chosen by the Department of Revenue shall do all of the following:
"1. Ensure compliance with all student privacy laws.
"2. Collect all test results.
"3. Provide the test results and associated learning gains to the public via a state website after the third year of test and test-related data collection. The findings shall be aggregated by the grade level, gender, family income level, number of
"(d)(1) The Department of Revenue shall adopt rules and procedures consistent with this section as necessary to implement the tax credit scholarship program.
"(2) The Department of Revenue shall provide a standardized format for a receipt to be issued by a scholarship granting organization to a taxpayer to indicate the value of a contribution received. The Department of Revenue shall require a taxpayer to provide a copy of the receipt when claiming the tax credit pursuant to this section.
"(3) The Department of Revenue shall provide a standardized format for a scholarship granting organization to report the information required in paragraph j. of subdivision (1) of subsection (b).
"(4) The Department of Revenue may conduct either a financial review or audit of a scholarship granting organization if possessing evidence of fraud.
"(5) The Department of Revenue may bar a scholarship granting organization from participating in the tax credit scholarship program if the Department of Revenue establishes that the scholarship granting organization has intentionally and substantially failed to comply with the requirements in subsection (b) or subsection (c).
"(6) If the Department of Revenue decides to bar a scholarship granting organization from the tax credit scholarship program, the Department of Revenue shall notify affected educational scholarship students and their parents of the decision as quickly as possible.
"(7) The Department of Revenue shall publish and routinely update, on the website of the department, a list of scholarship granting organizations in the state, by county.
"(e)(1) All schools participating in the tax credit scholarship program shall be required to operate in Alabama.
"(2) All schools participating in the tax credit scholarship program shall comply with all state laws that apply to public schools regarding criminal background checks for employees and exclude from employment any person not permitted by state law to work in a public school.
"(f) The tax credit provided in this section may be first claimed for the 2013 tax year but may not be claimed for any tax year prior to the 2013 tax year.
"(g) (1) Nothing in this section shall be construed to force any public school, school system, or school district or any nonpublic school, school system, or school district to enroll any student.
"(2) A public school, school system, or school district or any nonpublic school, school system, or school district may develop the terms and conditions under which it will allow a student who receives a scholarship from a scholarship granting organization pursuant to this section to be enrolled, but such terms and conditions may not discriminate on the basis of the race, gender, religion, color, disability status, or ethnicity of the student or of the student's parent.
"(3) Nothing in this section shall be construed to authorize the violation of or supersede the authority of any court ruling that applies to the public school, school system, or school district, specifically any federal court order related to the desegregation of the local school system's student population."
Section 3. Nothing in this act shall affect or change the athletic eligibility rules of student athletes governed by the Alabama High School Athletic Association or similar association.
Section 4. This act shall become effective immediately following its passage and approval by the Governor, or its otherwise becoming law.
ENROLLED, An Act,
To adopt and incorporate into the Code of Alabama 1975, those general and permanent laws of the state enacted during the 2013 Regular Session as contained in the 2013 Cumulative Supplement to certain volumes of the code and 2013 Replacement Volumes 16A, 19A, and 22; to initially adopt and incorporate into the Code of Alabama 1975, 2013 Volume 22H (Local Laws Greene — Jackson Counties) and to adopt and incorporate into the Code of Alabama 1975, 2013 Cumulative Supplements to local law volumes; to make certain corrections in the replacement volumes and certain volumes of the cumulative supplement; to specify that this adoption and incorporation constitute a continuous systematic codification of the entire Code of Alabama 1975, and that this act is a law that adopts a code; to declare that the Code Publisher has certified it has discharged its duties regarding the replacement volumes; to expressly provide that this act does not affect any other 2014 session statutes; and to specify the duties of the Secretary of State regarding the custody of these cumulative supplements, replacement volumes, and initial volume.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. (a) Those general and permanent laws of the state enacted during the 2013 Regular Session as contained in the 2013 Cumulative Supplements to Volumes 3 to 16, inclusive, Volumes 17 to 19, inclusive, Volumes 20 to 21A, inclusive, and Volume 22A and the 2013 Replacement Volumes 16A, 19A, and 22 and the additions and deletions made by the Code Commissioner for editorial purposes, as edited and published by West Group, as the Code Publisher, which volumes of the 2013 Cumulative Supplement and 2013 Replacement Volumes are identified and authenticated by the Great Seal of the State of Alabama placed upon the front and back of each of the volumes of the cumulative supplement and upon the first inside page and the last inside page of the replacement volume, are adopted and incorporated into the Code of Alabama 1975.
(b) The following corrections are made to the 2013 Cumulative Supplements:
(1) Section 6-5-752, 2013 Cumulative Supplement to Volume 5, page 160. To correct a publishing misprint in subdivision (7), delete the words "RESPONSE PERIOD." in the definition and replace it with "REPOSE PERIOD."
(2) Section 12-19-91, 2012 Replacement Volume 11A, page 198, to correct a publishing error which resulted in the inadvertent deletion of language in subdivision (1) of subsection (c), at the end of the subdivision after "notice of appeal" restore the following:
(3) Section 12-25-32, 2012 Replacement Volume 11A, page 707, to correct an internal reference in subdivision (7), to reflect the renumbering of the subdivisions in this section in Act 2012-473, after the word
(13)
(4) Section 23-1-181, 2013 Cumulative Supplement to Volume 15, pages 19 and 20, to renumber various internal citations to code sections that have been renumbered and to delete references to sections that have been repealed to conform with the repeal and replacement of various sections in Title 40 of the code in Act 2011-565:
In subdivision (4) of subsection (a), delete "Division 2 of Article 2 of Chapter 17 of Title 40" and replace it with "Section 40-17-359"
In paragraph a. of subdivision (5) of subsection (a), delete "Section 40-17-31, as amended," and replace it with "subdivision (1) of subsection (a) of Section 40-17-325"
In subdivision (6) of subsection (a) after "less any refunds of proceeds pursuant to the provisions of" delete "Article 3 of" and after "Title 40" delete", or pursuant to the provisions of either of Divisions 3 and 4 of Article 2 of Chapter 17"
In subdivision (7) of subsection (a), delete "Section 40-17-72" and replace it with "subsection (c) of Section 40-17-359"
In paragraph a. of subdivision (3) of subsection (b), delete "Article 1 of Chapter 17 of Title 40" and replace it with "subdivision (2) of subsection (a) of Section 40-17-325"
(5) In Section 27-4-2, 2013 Cumulative Supplement to Volume 16, page 17, to correct a publishing error which resulted in the inadvertent deletion of paragraph d. of subdivision (1) of subsection (a), on the line after paragraph c., restore the following language:
d. Reinstatement
(6) Section 27-44-13, 2007 Replacement Volume 16, page 896, to renumber an internal citation to reflect the relettering of Section 27-44-9 in Act 2012-319, in subsection (a) replace "Section 27-44-9(g)" with "Section 27-44-9(h)".
(7) In Chapter 9E of Title 38 comprised of Sections 38-9E-1 to 38-9E-12, inclusive, 2013 Cumulative Supplement, pages 13 to 18, inclusive, to redesignate Chapter 9E as Article 9 of Chapter 6 of Title 13A and to renumber Sections 38-9E-1 to 38-9E-12, inclusive, as follows: Section 38-9E-1 as 13A-6-190; Section 38-9E-2 as 13A-6-191; Section 38-9E-3, as 13A-6-192; Section 38-9E-4 as 13A-6-193; Section 38-9E-5 as 13A-6-194; Section 38-9E-6 as 13A-6-195; Section 38-9E-7 as 13A-6-196; Section 38-9E-8 as 13A-6-197; Section 38-9E-9 as 13A-6-198; Section 38-9E-10 as 13A-6-199; Section 38-9E-11 as 13A-6-200; and Section 38-9E-12 as 13A-6-201.
(8) Section 40-13-6, 2013 Cumulative Supplement to Volume 21, page 155, to correct a clerical error and reference the intended subsection and subdivision, in the first sentence of subdivision (2) of subsection (e), replace the language "subsection (c)(1)" with "subdivision (1)".
Section 2. Those local and permanent laws of the state previously enacted and contained in initial 2013 Volume 22H (Local Laws Greene — Jackson Counties) and the local and permanent laws pertaining to various counties enacted during the 2013 Regular Session as contained in the 2013 Cumulative Supplement to Volumes 22B, 22C, 22D, 22E, 22F, and 22G and the additions and deletions made by the Code Commissioner for editorial purposes, as edited and published by West Group, as the Code Publisher, which volumes of the 2013 Cumulative Supplement are identified and authenticated by the Great Seal of the State of Alabama placed upon the front
Section 3. The adoption and incorporation of the supplements and replacement volumes specified in this act shall constitute a continuous systematic codification of the entire Code of Alabama 1975, for purposes of Section 85 of the Official Recompilation of the Constitution of Alabama of 1901, as amended. This act is a law that adopts a code for the purposes of Section 45 of the Official Recompilation of the Constitution of Alabama of 1901, as amended.
Section 4. It is declared that West Group, as the Code Publisher, has certified that it has discharged its duties and responsibilities to edit and publish 2013 Replacement Volumes 16A, 19A, and 22 of the Code of Alabama 1975, by combining the material in the previous bound volumes with the material contained in the cumulative supplement without making substantive changes, but making, under the supervision and pursuant to the direction of the Code Commissioner, nonsubstantive changes and corrections as may have resulted from changes in reference numbers, changes of names and titles of governmental departments, agencies, and officers, typographical errors, grammatical changes, and misspellings.
Section 5. The adoption of this act shall not repeal, supersede, amend, or in any other way affect any statute enacted into law during any 2014 session of the Legislature.
Section 6. Upon passage and approval of this act, the duly authenticated volumes of the 2013 Cumulative Supplements and the 2013 Replacement Volumes shall be transmitted to the Secretary of State, who shall file the volumes of the supplements and the replacement volumes in that office. The volumes of the supplements and replacement volumes shall not be removed from the office of the Secretary of State, but the Secretary of State, upon request, under proper certificate and seal of that office, shall certify any part or parts thereof upon payment of the fee specified by law for similar services.
Section 7. This act shall become effective immediately following its passage and approval by the Governor, or its otherwise becoming law.
Ex parte M.D.C., 39 So.3d 1117, 1141 (Ala. 2009) (Murdock, J., dissenting) (quoting Stark v. Watson, 359 P.2d 191, 196 (Okla.1961), quoting in turn Crescent Ring Co. v. Travelers' Indem. Co., 102 N.J.L. 85, 132 A. 106, 107 (1926)).
