Tax Debate Heating Up

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Figures from the Alabama Revenue Department show some Alabama cities and school districts would have to lower their tax rates if voters pass Gov. Bob Riley's tax proposals.

Riley's plan, if approved and fully phased starting in 2008, would raise state property taxes by $401 million annually and local property taxes by another $66 million.

That increase would force some cities and school districts to lower their tax collections so their total state and local property taxes would not exceed caps voters added to the state constitution in 1978. Under the cap, the tax limit on a $1 million store is $15,000 a year.

Riley aides said Tuesday that if voters pass the plan, Riley will push for another amendment to the state constitution that could fix the problem. Any amendment has to be approved by the Legislature and by voters.

Mike Kilgore, executive director of the Alabama Farmers Federation, which opposes Riley's plan, said the mistake shows Riley wasn't careful enough in preparing the plan.

Meanwhile, callers to state offices in Montgomery Wednesday got more than Muzak when they were put on hold to wait to conduct business. Callers put on hold received a recorded pitch for Riley's $1.2 billion tax and accountability package, complete with background music.

The message calls the plan "courageous'' and says if the plan passes Alabama taxpayers will still "pay some of the lowest property taxes in the nation.''

A spokesman for a group opposing the tax package called the phone message "the latest abuse of state property'' by supporters of the governor's plan.

Voters go to the polls Sept. 9 to vote on the plan, designed to fill a $675 million deficit in the state's budgets and to provide additional money in the future for other programs Those include scholarships for high school graduates with a B average or better.