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<p>A study from the University of Alabama predicts Gov. Bob Riley's tax and accountability package will have a positive impact on Alabama's economy, including increasing jobs and earnings.
But the leaders of a dozen conservative groups, including Eagle Forum President Phyllis Schlafly, say it will hurt Alabama families. </p>
<p>Schlafly said she never expected to see a $1.2 billion tax plan from Republican Gov. Bob Riley. </p>
<p>"We were all shocked. Of course, we backed him when he ran and when he was in Congress. He was a good conservative congressman," she said in an interview Friday. </p>
<p>Riley has proposed raising taxes $1.2 billion over a four-year period, which would be the largest tax increase in state history. The money would fill a $675 million deficit in next year's budget and be used to pay for new programs, including college scholarships for "B" students. Alabama voters go to the polls Sept. 9.
The Center for Business and Economic Research at the University of Alabama issued a report Friday saying that if the proposed tax revenue is spent the same way as current revenue and the scholarship program is funded, then employment should rise 0.53 percent, or 10,544 jobs, earnings should grow by $216 million, and the gross state product should increase 0.38 percent, or $533 million, when the plan if fully implemented. </p>
<p>"The tax package is good for Alabama," the Center for Business and Economic Research said in its report.
The University of Alabama economists reached a different conclusion than an earlier study by the Beacon Hill Institute, which predicted that Riley's plan would slow down job creation in Alabama. </p>
<p>Riley said Friday he had not yet seen the University of Alabama study, but its conclusions were no surprise. He said the Chambers of Commerce Association of Alabama, the Business Council of Alabama, and several other business groups would not have endorsed his plan if it were going to hurt the state's economy. </p>
<p>On Friday, the leaders of a dozen conservative groups signed a letter urging Alabama voters to reject Riley's plan Sept. 9. Those signing the letter besides Schlafly, included Grover Norquist of Americans for Tax Reform, David Keene of the American Conservative Union, Dick Armey of Citizens for a Sound Economy, Duane Parde of the American Legislative Exchange Council, and Connie Mackey of the Family Research Council.
They said that higher income, property, car, repair, cigarette, and mortgage and deed charges will be bad for families. </p>
<p>"It confounds us how this can be seen as good for families of Alabama or even 'the least among us' as proponents like to claim. Families making $30,000 a year will pay upwards of nine to 10 percent in new service charges and the cost of achieving the American dream -- buying and owning a home -- will become out of reach," the letter said.
Riley said another conservative group, the Christian Coalition of America, studied his plan and came to the conclusion that it would help families by funding necessary state services, improving public schools and cutting taxes on low-income families.
Others signing the letter Friday in opposition to Riley's plan were Kerri Houston of Frontiers of Freedom, John Berthoud of the National Taxpayers Association, Darrell McKigney of the Small Business Survival Committee, Stacie Rumenap of U.S. Term Limits, Jeff Mazzella of the Center for Individual Freedom and Daniel Clifton of the American Shareholders Association.