CULLMAN, Ala. – Recently, U.S. Senator Doug Jones, D-Alabama, a member of both the Senate Health and Banking Committees, introduced legislation to encourage businesses to build medical equipment in America. Jones has advocated jumpstarting this new sector within Alabama’s economy by incentivizing the reopening of idle factories and putting them to use producing critical health supplies.
“The coronavirus pandemic has caused millions of Americans to lose their jobs and has created a national health care crisis. It has also shined a spotlight on how dependent the United States is on other countries for the health care supplies that we need to fight this virus and to keep Americans safe,” Jones said. “By incentivizing companies to build medical equipment here at home, we can bring countless jobs back, breathe life into shuttered factories and ensure that our communities have the crucial COVID-19 tests, masks, ventilators and other supplies they need to protect themselves from this disease.”
The Build Health Care Equipment in America Act would:
- Create tax deductions for businesses to repurpose existing facilities or to build new ones to manufacture medical supplies
- Provide tax credits for employers who hire workers from declining fields
- Increase education tax benefits for health care workers in short supply fields
- Create grants to communities to improve broadband access around facilities to be used as health care manufacturing sites
In April, Jones encouraged Alabama Governor Kay Ivey to establish a health care manufacturing task force to explore ways for Alabama to move to the forefront of health care manufacturing for the United States.
The Tribune spoke with Jones this week about the legislation.
“I think that coming out of this crisis, we’re going to see the need more and more health care protective equipment, there is no doubt about that. Even after this pandemic may have subsided and is over, we are not going back to a situation where we have not enough and so we have got to lessen our dependence on foreign countries and foreign manufacturers,” said the senator. “This legislation is designed to do just that. It will be federal tax incentives for a business to either revitalize or repurpose existing facilities that are in the country, and I’d love to see them in Alabama; we’ve got a number of shut down facilities. It will give tax credits to hire and train workers, especially workers who have been laid off and furloughed in declining industries, and for the communities that need it, they can get grant money to help bolster their internet service, so they can have better broadband to meet these needs. It’s a really good piece of legislation that I’d love to see passed this year.”
He added, “There’s companies that have already done some of this like HomTex right there in Cullman, that can take advantage of the tax incentives and tax credits for this tax year, and I think going forward we’ve got incredible opportunities in the state of Alabama to do this.”
He elaborated on the benefits for companies.
“It’s going to give them incentives; it’s going to help with tax breaks to give them incentives to invest in those facilities that are out there. They would have to repurpose them, they would have to have additional machinery, they would have to be brought up to specifications and environmental concerns that are out there,” Jones said. “But rather that standing up a whole new building, there are so many facilities that are out there.”
As to how the legislation could potentially support and affect smaller, rural communities, he said, “Well one, we’ve got to convince and got to be looking for the rural areas- and local areas like that have any number facilities that may have closed. There are places dotted throughout the state of Alabama with facilities that have closed over the last few years. Those are perfect opportunities, the perfect places to come in and bring these businesses to get people working in those areas, to bring down the unemployment that is so high in those areas. These incentives would really help that and I think that Alabama needs to make a concerted effort. We do a really great job and have done a very good job of attracting business in industry, but sometimes these rural areas get overlooked. I think if we can get those manufacturing facilities up and going again in these areas, it would really help those local economies, rather than concentrating our economies in Huntsville, Birmingham and Mobile.”
Jones said it’s important Alabama seizes this opportunity now.
“I think as we go forward, we’re going to continue to have high unemployment. Remember that right now, our unemployment has jumped by 10% and it is likely to go higher. Unemployment will come down as the economy opens, but it’s not going to get down to the historic lows that we saw for a long, long time, and it’s not going to get down to that level without some investment and help with the various companies that need to both reopen and build out. We’re going to lose some companies, there’s no question about that, so what we need to do is to be focusing on new areas that we can expand our economy, new areas where new businesses can be brought in and start it up in addition to those businesses that we’re trying to save right now,” he said. “So, I think Alabama really has got a unique opportunity right now. If you look around the state at the various communities that could benefit from something like this, they are all over the place, and I think it’s going to depend on both state officials and local governments to take a real good hard look at this and look at the work force in their area and see if it’s a need and try and get those jobs.”
When asked to estimate how many jobs this bill could bring to the state, Jones answered, “It’s going to depend on how many we can attract. I think the sky’s the limit on that. Back when I was growing up, I never dreamed that Alabama would be the fifth largest manufacturer of automobiles in the country; I thought only Detroit was going to do that, and now look at the automobiles that we turn out. There are some 57,000 jobs in Alabama that are directly tied to automobile manufacturing, and that number is only growing. So, if we start this program now, I think the sky’s the limit, and I think we have the ability to do that. It’s going to depend on what the State can do if we get this legislation passed- what the State can do is they can supplement those incentives, because this has to be really a federal-state partnership on the local level- and how aggressive the local chamber of commerce will be. Because one of the things that I’ve heard from folks is, ‘Well, these might not be the best-paying jobs and they may not stay here; we’re afraid they may come and then they may go,’ and I completely disagree with that. I think any job right now is a going to be a good-paying job, and number two is I really believe that health care manufacturing is going to come back to this country to stay. I don’t think it’s going to be outsourced like it was; it is just too important to us going forward.”
So, what’s the estimated time frame from potential bill passage to repurposed factories manufacturing PPE in Alabama?
Said Jones, “The time frame is going to depend on whether or not we can get it to the Senate floor. I would love to get it in the package of legislation; I would especially love to get it passed this year. It will depend on the companies themselves. Are they going to take an existing business and kind of redo their line, to some extent the way HomTex in Cullman has done? They kind of repurposed some of their lines that they were doing to build masks and some things like that; that’s one way to do it. Other ways are to take these buildings, to try to renovate them, put them in and get the equipment in and get the workers trained. This is not going to be like flipping a switch. You’re not going to see this bill pass and all of a sudden, these things are going to pop up left and right. Remember, though, that the goal of this is not just the immediate need in this pandemic, but it is the long-term need for personal protective equipment the country is going to have to have going forward, even as we come out of this crisis. We are going to be in a new world when it comes to this; health care workers are going to need more than in this pandemic. Schools, businesses, first responders all are going to need more. We’ve got to replenish the stockpile. What this bill is, this is for long-term economic investment in a state like Alabama.”
Of potential investment from the State to implement the bill, Jones said, “It’s going to depend on locality, probably. Normally their investments are made through tax rebates or forgiveness of certain taxes, whether its local property taxes, certain employment taxes or corporate taxes, maybe. That’s how the state usually tries to invest. So, that’s going to depend on the locality, and it’s going to depend on the size of the operation that’s being proposed in the specific locality.”
In an op-ed Jones recently wrote: “Let’s build America’s health care equipment in Alabama.” He said he asked Alabama Governor Kay Ivey to, “consider creating a task force that would bring together the business community and experts to look at Alabama’s existing manufacturing infrastructure and leverage our world-class medical research capabilities alongside my legislation.”
When asked if Ivey has responded, he answered, “I’ve talked to the governor’s office and I’ve also talked to Greg Canfield, who’s the Economic Development director, and I think they are looking at this. I think they already began to look at existing businesses. Again, I think HomTex is an example, but there’s some others that have repurposed to do some mask development and manufacturing. I do think they are going to be looking at this, but I believe they are certainly going to look at this with greater emphasis should there be a tax incentive from the federal government that I think we can provide with this bill.”
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