By David Sher
Coach Saban seems to understand what we give up by living in Alabama.
This spring my wife and I attended our grandson’s high school graduation in Atlanta.
We’re so proud because our grandson had been accepted to Georgia Tech.
But then it struck us.
Our Atlanta son and his wife will not have to pay college tuition!
However, our daughter, who lives in Vestavia Hills, will have to pay tuition for both her children.
The State of Georgia awards HOPE Scholarships to qualifying high school seniors.
Students who live in Georgia and earn at least a 3.0 GPA (B average) can attend public colleges or universities in Georgia tuition free if accepted.
“Funded by the Georgia Lottery since its inception in 1993, the HOPE scholarship program has helped more than 2.1 million students at eligible state public and private universities and public technical colleges with over $14 billion of financial assistance.”
Alabama families, unless their children attend Birmingham City Schools, have no comparable scholarship option. Birmingham City Schools do, however, award Birmingham Promise scholarships to all high school graduates to Alabama public colleges or universities free of tuition.
If my Birmingham grandchildren lived in Georgia they would meet the HOPE scholarship criteria and would qualify for free in-state college educations.
Then I got to thinking, what else are we giving up by living in Alabama.
Nick Saban retired to Florida
In January Nick Saban announced his retirement and moved to Jupiter Island, Florida,
There are probably lots of reasons Coach Saban chose Florida, but one of them has to be financial.
Saban paid $17.5 million for his 6,200 square foot home, which features “marble floors, a floating staircase, floor-to-ceiling glass walls, a private garden, a dock and a boat lift.”
He’s a ‘member at Jupiter Hills Club in Tequesta, one of the state’s top private courses. The ultra-exclusive club requires an initiation fee of $125,000 and $17,300 in annual dues.”
Saban paid $133,020.94 in property taxes last year.
Coach Saban can certainly afford these luxuries–he has an estimated net worth of almost $100 million.
But Saban will be able to pay for many of these niceties from what he’s saving by not living in Alabama.
Florida has no state individual income tax. Alabama’s top income tax rate is 5%.
I certainly don’t know how much Coach Saban earns annually, but let’s make a conservative estimate of $10 million.
He signed a multi-million dollar a year contract with ESPN, owns nine car dealerships, is being paid $500,000 a year by the University of Alabama as a consultant, and may still be talking to the Aflac duck.
If this estimated income is correct, Coach Saban is saving about $500,000 a year by avoiding Alabama’s income tax. It would be financially insane for Saban to remain in Alabama.
Okay, Coach Saban’s income is extraordinarily large, but what about the rest of us?
Any resident of Alabama who earns $4,500 or more a year, which includes just about everyone, owes Alabama income tax. It may not be enough to encourage you to move out-of-state, but it does add to our cost of living.
And it gets worse
We travel to Destin every year for our family beach vacation. We stay for about a week and buy a lot of groceries. Florida charges no sales tax on groceries. It really hurts when we return home and go to the grocery store and have to pay the sales tax.
But it’s not just groceries. Alabama has the 5th highest sales tax rate in the U.S.
Five states have no sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon.
Many municipalities around Jefferson County, where I live, charge sales tax of as much as 10%. (State 4%; Jefferson County 1%; municipalities 4-5%)
That 10% rate is more than 93% of the counties in the nation.
The folks in Arab Alabama pay 12.5% sales tax—the highest in the state.
Alabama…
- Offers no tuition free college scholarships
- Imposes as much as a 5% individual income tax (two contiguous states charge none)
- Assess some of the highest sales taxes in the nation
Of course, we have low property taxes which is really good for wealthier folks, but many of them, like Coach Saban, have moved out-of-state.
David Sher is the founder and publisher of ComebackTown. He’s past Chairman of the Birmingham Regional Chamber of Commerce (BBA), Operation New Birmingham (REV Birmingham), and the City Action Partnership (CAP).
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Invite David to speak for free to your group about how we can have a more prosperous metro Birmingham. dsher@comebacktown.com.
Come on people, in 1960, Atlanta, Birmingham, Memphis, and Nashville were comparably sized cities. Need I say more?
Atlanta just passed DC and Philadelphia to become the 6th largest metro in the country, with a GDP outsizing countries like Israel and Denmark.
Your GOP stronghold over Alabama doesn’t lobe you back the way you think. Look at your state. You need a balanced political clinate to make progress, not just a bunch of old Republicans still fighting Civil War era issues.
No comment.
Well David you are spot on my friend!
So what is the solution?
Be like Florida and or Georgia?
Alabama is unique??
This is a stupid article! Where Saban “calls” home is irrelevant and he’ll continue to have a house here. Based on this article he should call Florida his home state due to no income tax. He certainly doesn’t care about his grandchildren’s education costs and won’t make a decision based on that. Plus his mom and daughter live here!
You are right, David, Alabama’s REGRESSIVE TAX structure is an undue burden on millions of its low-income citizens – as taxes take a larger percentage of income from them than from middle and high income earners. Why do our elected representatives choose to add more burden to the least among us? Low taxes assessed for real estate, timberlands and industry contribute to this regression. Alabama needs more income to provide better services to all citizens. Our lawmakers need to do better:
rethink our Tax structure- approve a Lottery- outlaw deadly Firearms – enact legislation that guarantees Fairness and Opportunity to all citizens. If you build this, new Businesses will come and provide more jobs and added tax revenue benefiting everyone.
Jerome
The big mules and wealthy benefit from this regressive tax structure indeed. The elimination of all state taxes of food is starting to happen I think?
Spot on, David. I’m glad you mentioned the Georgia lottery, which funds those HOPE Scholarships. The Tennessee and Florida lotteries are also earmarked for education. Why is there no lottery in Alabama? The main impediment is the legislature, naturally. Competing forces (casinos) from out-of-state and in-state gaming interests continually kill efforts to establish one. Of course, some oppose the lottery on moral grounds. Like it or not, lotteries are considered “taxes” on the poor (and some say the mathematically challenged). We live in a transitional West Nashville neighborhood, which is populated (in steadily decreasing numbers) by working class white, Black, and Hispanic residents. We often find losing scratch-off lottery tickets in our yard, which were purchased in the convenience store down the street. I absolutely support the right of folks, including those with less discretionary income, to play the lottery. But I hope the proceeds from their lottery tickets aren’t the main reason TN has no income tax.
On the other hand, guess who else plays the TN, FL, and GA lotteries? Alabamians. At the last exit on I-65 before you leave Tennessee stands a gas station/convenience store. Many of the cars parked there have Alabama license plates. Inside they’ve placed a table and chairs for all the Alabamians to sit while they check their TN lottery tickets. I’m sure you’ll find the same everywhere you cross from AL into GA or FL.
We can’t vote in Alabama any more. We have no say in who serves in the state legislature or in amending the bloated 1901 constitution to change the state’s regressive tax system. Fortunately you and others do.
The big mules and wealthy wouldn’t be here to give you a job if you didn’t scratch their backs in some way. The last thing Alabama needs to do is scare off more rich people or potentially successful people. Again, they’re the ones who keep the ball rolling and keep you employed. So it’s not as easy as that.
I’ve long argued the cost of living is NOT lower in Alabama. If COI is lower, it’s not by much and it’s offset by lack of “things” (job opportunities, entertainment options, latest shopping/grocery/food, etc. etc.) that are readily available in other places. Given this lack of “things” the COI is not appreciably less. You end up with less bang for your buck.
This is very apparent when I come home to visit family. We sit around and talk about what we want to do or where to go grab food.. It’s always the same few places. Rarely something new or interesting. So not only is the Bham area, and AL in general, not really cheaper to live in, it’s a worse deal overall because there’s very little upside.
Also, I’d plan on Sabans daughter moving any time now. I seriously doubt she’ll be in Alabama long-term. Alabama offers literally zero that compares with Jupiter, FL. He didn’t stick around long.
You not only got the nail right on, but you got the hammer as well. The kind of non thinking that is behind such things is clearly evident.
We should also add that what might be called a basic notion about the character of Alabama that it is predominantly a rural state is incredibly off track. Add up the population of metro Birmingham, Huntsville, Mobile and Montgomery, Add Auburn-Opelika, Tuscaloosa, Florence-Sheffield, Mussel Shoals, Anniston and what is the percentage of these urban places. Is it not somewhat more than 50%?
Alabama’s history is rural. Its pre civil war history is that it was rural indeed. As we well know cotton was the cause of its being one of the two wealthiest states in the Nation, Mississippi being the other. Were any thoughts given to true investing in the future of this state with all of that wealth? Are will still living with that apparent habit of not investing in the future?
Certainly not altogether, but about things such as taxes, a wretched constitution and poor infrastructure certainly indicate that.
Think! and again, break that bad habit!
Funding middle class scholarships through gambling money is taking from the poor to give to the rich. Thank you Alabama for doing better than Georgia on this issue at least.
Tom: I think that’s a “stretch “ – I can’t fathom that funding education would be limited to anyone. If a student qualifies under the rules, benefits would rightly be awarded to those deserving students- regardless of class or color or gender or religion – as guaranteed in our Democracy. All “classes” would be eligible.
Both you and tom are right!
Tom Huddle, I am in complete agreement with you on that. Florida Lottery included. In Florida, parents can contribute to a find a bit similar to a pension fund called the ‘Bright Futures’ and built up a fund for Florida students as if they have their own built-in scholarship. (Once a clear thinking Florida gasoline station operator in Cottondale when a lottery ticket was being purchased said: ‘Oh you are giving a donation.’ He knew how rare it is to actually win anything.)
That method is leaving the decision about the quality of schooling up to an ‘iffy’ at best machine that can not really ever set a true budget. Think and decide based on full understanding of what works and then be sensible enough to work out how to pay for it.
Gambling is not good anyway, given that warnings have to be given about be addicted to it! I am right with you Tom. That is a sign of Alabama strength! Invest and if better than gambling as it is is at least more controllable.
Thank on one and all: to improve Alabama is to Improve Birmingham!
I must add this that I believe is a provable fact as I have witnessed it myself, It is the poor who regularly play the lottery dreaming of money coming out when it hardly even does. They are losing, wasting their money. There is a missing and serious piece of education in this isn’t there? Economics! The lack of that hits all races, all citizens rich or poor!
And unfortunately I think it is true that there is continuing inequality of quality of education, depending on where you live, districting etc. Poor and black communities often have too little so on the ignorance goes, something bad for the entirety of society. On that matter, I have agreement with Jerome Leader.
John Oliver did a good debunking of lotteries on his HBO show a few years ago.
Bart, John Oliver knows and that is the way it is, just as he said.
Thanks Alabama is a smart state regrading lotteries.
There are 15 state senators that are blocking us from voting on gaming issues! On look into who they truly represent and that will tell you a lot!!
I live in Florida and have a home in Alabama. It is still far cheaper to live in Alabama. The prices in Florida are insane and unless you have Saban $ the housing/insurance costs are astronomical. Going out to dinner is a third of the cost in Alabama and things like home repairs, groceries and cars are cheaper, too. Saban moved to Juniper for hobnobbing with the elite and the amazing golf. Hi mom and daughter will end up moving here as well.
Me too Gablesgirl. Like you my heart is in Birmingham and I live in Tallahassee Florida and almost part-time in Vancouver B.C. These three are very interesting to compare! What you have written from my several points of view is absolute correct, South Florida and east coast the worst. I write as I have witnessed these by personal experience. ( costs in Florida a terrible, Vancouver completely unlivable.) And here comes another hurricane and I certainly hope ‘Debby’ moves away before reaching us!
Don’t you think hundreds of miles of beautiful beach in Florida with thousands of rental properties, inflated beach real estate and warm Orlando theme parks ( 40 million a year visits) have something to do with Florida not having an individual income tax. They have the perfect tax for a politician… tax visitors outside your constituency such as hotel and rental car taxes rather than your own citizens!
Raleigh, that makes perfect sense to me, but how do you explain Tennessee? At least Alabama has some beach…Tennessee has none. Unfortunately, Alabama has to compete for companies and jobs with two contiguous states with no individual income tax. If you were the CEO of a major corporation with a multi-million dollar income and were looking to relocate to the Southeast, it’s pretty obvious Alabama would be at a disadvantage.
We lived in St. Augustine on two occasions, 1980-83 and 2014-16. Cost of living there, as well as the Panhandle and much of rural interior Florida, didn’t exceed urban Alabama then, including housing if you didn’t live on the beach. As for Tennessee, I can’t speak about the rest of the state, but the companies that have located to the metro Nashville area didn’t bring the CEO. They’re regional headquarters of Nissan, Bridgestone, Amazon, Oracle, etc. The biggest tax benefits were the corporate tax breaks and other goodies. Alabama has those tools to attract companies as well. So what’s the difference? In the case of Nashville, as with Huntsville, it’s in large measure the availability of an educated work force. Speaking of Alabama…..
Jerome
There are indeed many deep and dark reasons Alabama continues be mired in the status quo!
You are spot on with the items you list using “NO” for real.
Read senate bill 129 and short version of the book titled the 1619 Project! Until we have a Bold Governor like the one in Kentucky or North Carolina who includes the 30 percent Black population in Alabama the out of state corporations remain very leery of us !!
Correct
That is why Harvey Woodward sought to establish Indian Springs School. and spread that around the state. The Helena one is great. No other’s happened. Now he was one man from Maine who made a serious investment in Alabama! And the only reutrn he most have wanted was not more money!. I am sure he must have been wanting the pleasure of having done something very good with his money.
Another, the Rushtons, Funder of one of the largest carillons in the country, made in Belgium, 6o bells in the tower over the library with room for three more. When moved from Reid Chapel, enlarged and placed on top of the more broadly visible and heard library. That became the primary symbol of Samford University, and now, I hope you people who could help, due to age and weather damage it requires a major structural rebuild, before it breaks down the tower itself! And the bells when they fall too? It is a unique set of bells. every single one is marked with a message or memorial.
Another note Re; education: it has been ranked at the highest level of colleges and universities in the USA, with students from very many state and foreign countries. experiencing its beautiful campus. All A+ for Birmingham. UAB also highly ranked. Just because there are some spots with poor education does NOT mean that the whole population is poorly educated. THINK! I am very sorry about the decline and fall of Birmingham Southern.
Our beaches are the best. But we do not have the Smoky Montains or the Grand Old Opry! But if you time to look at what Alabama does have it is truly beautiful.
Do we need a new state Motto? It seems to me that maybe Alabama rests a little too much! As in ‘Here we rest’
Try sales tax! and other costs!
Oh! Have you counted how many of those fine beaches get washed away, and how many wet lands are there. Do you know how much money has been spent ‘restoring’ those beaches only to have to do it again sometime? That’s is yet another hurricane ‘benefit.’ (What you don’t know can be really really very expensive!)
Here is a fact you might not know. Florida has 11,000 miles of internal waterways, Alabama has 77,000! and the longest navigable waterways in the entire nation. Check that out. And there a potentially even more!
I hear Tom and Roy and respect their opinions…
but, doing NOTHING won’t set things right!
No gambling No lottery No tax reform No scholarships
Alabama is mired in the status quo! There must be a deep and dark reason?
Dig out the ‘deep and dark.’ Get rid of it or them, but never go to lottery. That will not make Alabama a better state, balance budgets of families or anything like that. It is nothing but losses to those who use it and a rare win worth that ‘donation’ to state government.
Gablesgirl: it’s only more expensive when you compare unlike items.. Mcdonalds, gas, outback steakhouse, etc is all about the same price. You CAN spend alot more in Florida if you want. I have found that many things like repairs, HOA dues, internet prices, and other normal every day service items are often (not always) considerably more expensive in Alabama. That’s probably due to lack of competition. Other than housing, i can’t think of anything that’s more expensive when you compare apples to apples.
Do NOT forget there is a very extreme difference between south and central Florida and North Florida. Also I guarantee you that in Tallahassee gasoline has NEVER been less than about 20 cents per gallon more expensive than Alabama. And gsoline is often much cheaper than in other parts of Florida. That adds to the cost of just about everything that is delivered anywhere.
There is absolutely nothing cheap about Coral Gable I promise you!
When I first moved to Florida I was told something that is clearly still true. It was told as if a joke but it is true. This was from a friendly Floridian. ‘ In Florida you go North to get South!
Some NYC Developers are marketing the BSC ?
Watch whom the buyers will be now?
Is the Methodist Church still the owner?
Church of the Highlands has very deep pockets!!!!
I would love to know more about this. The loss of Birmingham Southern University is serious damage to Birmingham. Thank you for that information. What is wrong with Birmingham’s Methodist community that it had been so highly regarded and they could allow it fail?
Roy this was mentioned by AL. Com on Tuesday.
The president of Birmingham Southern College is a retired Investment Banker himself! I do want to say to much as the Methodist community is difficult to gauge regarding this matter?
What entity actually owns the property is but one question? Why did the state of Alabama refuse the 30 million dollar loan to help keep the College open is the yet unresolved question?
Thank you George. I confess to not knowing much about the unfortunate demise of Birmingham Southern. I have only slight knowledge of the causes. For a while the former President was participating in David Sher’s Comeback Town podcast. He was out to advance Birmingham. That certainly must have been a part of his effort to save that fine University. I was impressed by him, seeing him as optimistic and a good choice to be the President. It is as if some power wanted it to collapse, and really that is not even yet enough to be called a ‘conspiracy theory,’ perhaps even an hypothesis?
As to the State of Alabama giving a loan. That was certainly a wild attempt. Our state would not fund, even by loan. a private University would it ever? It would have been only a little thinkable that it would be bought to make it public. If that had been the case, how would that fit the state’s higher education budget, curriculum and future budget allocation? We would still have to believe that Birmingham for a variety of historic reasons so often mentioned here, would not be an interest of Alabama, fundamentally never having been a friend of the city, in effect even own its child. never really accepted. If all had not just been stuck within Alabama, what about sources from other states, sources such as wealthy alums elsewhere. There must have been some effort. I just know nothing about that. It is just a very sad story that should not have happened.
It is a pleasure having you as a part of our discussions.
BSC should have closed a while ago but was held open probably by pandemic money. The state should absolutely not be writing checks to private institutions to keep them afloat. If they cannot stay open on their own merits then close them and bring in something successful that can survive.
The truth of the matter is BSC lost charm and prevalence in its later years so there was little interest in going there and paying that high tuition. Anyone wanting private school education for similar $ would choose Samford any day especially given the location.
BSC was also a pretty small school and churned out mostly liberal arts degrees that don’t pay – hence alumni giving was probably quite low.
Good observation Ivan.
But given the history of Alabama being an openly Christian conservative state I wrongly assumed the Confederate Christians in the state senate and state house would enact a law mandating such? I guess they tried but gave the power to the Treasurer who seem unfazed by the law given him the sole authority to do such!! I suspect the banking community and the NYC money elites have been eyeing this deal for some time according to some of my private business contacts!
Capitalism and Christians have long had private relationships in Alabama. Always follow the investment banking industry!
Deep dark unknown history lies underneath that observation I should think. In what smoke filled room might they meet? But I do think there is something important about your observation George. I wish we could know more than hints.
I have no argument with that. You have given a very rational observation,. Thank you
Roy Knight
In due time more will service but the Board of Trustees associated with the College and Methodist elites are very tight lipped about their plans! I do know once investment bankers and lawyers and developers get engaged the process goes very dark .
Do people who lock up their thinking also lock out the helpful advice others might help to offer? It is the old I know you don’t problem. Birmingham Southern seems to be suffering from that.
I think you have identified the fundamental problem there.
Roy, I say you are absolutely correct.
You have to look at the historical intersection of religion and education and capitalism in Alabama! Each state and country has also had to deal with the Big Mule outsiders many who do not live in this city or county or state but this a grand haven for the wealthy. You rarely see them , but they live amongst us. Just continue to watch the BSC issue.
I am just speculating now and am not a part of any team.
I will be very interested to know what happens, and if there should be any transparency, that I doubt will happen, to know what the background is. This is such a good example of what the deep and dark is. I and glad to know you are not a part of that and that we share understanding. It helps nothing and damages to opportunity for Birmingham to advance it good causes.
Roy I have always thought Christians and Capitalist and Confederates mix well together but mostly in private life. I have gotten to know quite a few since living in this city and county and state!
I do no business with them although I have been invited into their space over the years. Just a little leery for lots of reasons! This BSC debacle is an excellent case study. I still remain dumb founded that the legislative majority was unable to approve a 30 million dollar loan (should have been an economic development grant) ?
Some said the Governor was going to veto such?
That would have been a hoot given her love for the people of Alabama.
Interesting to read. ‘Leery I do understand as well. But it is best to connect, leery or not. That is what I have done and learned much from personal experience. Thanks
I respect the reason the Governor stated for not supporting the loan/grant to BSC, but disagree with the manner in which the Legislature backed off?! Something is missing in Montgomery among the big mules.
Interesting to read. ‘Leery I do understand as well. But it is best to connect, leery or not. That is what I have done and learned much from personal experience.
I have never met the governor, Kay Ivey, but have long know her family in Camden, her home town. My Uncle was a farmer, living in ‘Possum Bend’ with a concession general store everyone was welcome to use. That accent of Gov. Ivey’s is still strongly Camden’s. I know that because I have relatives there and visited often, even before paved roads were even thought about. Miles and miles of dust, mud, and gravel for years and years, a part of the excitement of such travelling. Interstates were barely a dream!
Also Jeff Sessions grew up down the Road from Camden on the
way to my mother’s home, growing up in Monroe County.
What lives we have had, Fascinating!
Roy we humans have more in common than we realize! I learned long ago to listen and not overly judge human behavior.! Life is just too short to always be at war with people because of their beliefs!
In due time more will service but the Board of Trustees associated with the College and Methodist elites are very tight lipped about their plans! I do know once investment bankers and lawyers and developers get engaged the process goes very dark . I am all for capital markets working for the collective good. If people get rich GOD bless them and they can still do good with private money!
To be clear, I don’t think BSC was a Christian university by any realistic stretch. Their DNA is unlike Samford. They may have hung the Methodist sign up but even that is suspect on it’s relationship to Christianity. I don’t see your argument holding much water but that’s what the comment section is for. That and arguing about religion haha. Kidding so be nice.
I also hear you Ivan, and don’t know enough to contest what you have said. Just that it really could be the case. My perspective is similar to Georges and have been brought up Baptist, the Episcopalian gone Anglican and now ‘Non Denominational, worshiping in the Anglican tradition.’ Have developed a broad spectrum of thoughts about such things. Personally I find Methodists, started by John Wesley who never parted from the Church of England a little odd and often taken irrational political stands.
We hear you Ivan!
Yes being nice and kind is good all of us!
I am an old school Black Baptist so my thoughts are largely based on my experiences growing up watching how Christians of many races behave towards each other! I think the new owners of the BSC will do fine.! I drove by the campus last week coming from a funeral.! It is looking very beautiful as always with rolling landscape.
Interesting observation George. Even though we are not completely eye to eye in having the same background, it seems our views and their bases are quite similar. I find it quite nice when I meet someone who allows me to have and share this kind of experience. Thank you