01 — The WoundThe raise lasted one day.
In August 2015, the Birmingham City Council voted to raise the city's minimum wage. Not all at once — $8.50 in July 2016, then $10.10 in July 2017. Birmingham became the first city in the Deep South to set a wage floor above the federal $7.25.
Alabama has no state minimum wage at all. For workers there, $7.25 is the whole law.
At the start of the 2016 legislative session, a representative from a Birmingham suburb introduced HB174 — the Alabama Uniform Minimum Wage and Right-to-Work Act. It stripped every county and city in the state of the power to set wages, leave, or employment benefits.
Watching the bill move, Birmingham accelerated. The council scrapped the phase-in and made $10.10 effective immediately.
It didn't matter. HB174 was fast-tracked ahead of other legislative business, passed without public hearings sixteen days after introduction, and signed by the governor within an hour of final passage. Birmingham's minimum wage workers received the higher rate for one day before the state voided it.
More than 40,000 people lost a raise they had already been promised.
Workers sued. In Lewis v. Governor of Alabama, plaintiffs argued the preemption law intentionally discriminated against a city that is roughly three-quarters Black. A panel of the Eleventh Circuit found they had pleaded enough facts to state that claim. The full court then reheard the case and dismissed it in 2019 — not on the merits, but on standing. The plaintiffs had sued the state attorney general, and the court held their injury wasn't traceable to him.
The wage never came back.
- Birmingham ordinance: passed August 2015, $8.50 (2016) rising to $10.10 (2017)
- Alabama HB174: Alabama Uniform Minimum Wage and Right-to-Work Act, signed February 25, 2016
- Workers affected: more than 40,000 — National Employment Law Project
- Litigation: Lewis v. Governor of Alabama, 11th Cir. (en banc, 2019) — dismissed for lack of standing
- Panel analysis: Harvard Law Review, Vol. 132
02 — The MechanismThe bill did not start in Alabama.
HB174 wasn't a local idea that happened to move fast. Language preempting local wage ordinances had been circulating in state legislatures for well over a decade.
The American Legislative Exchange Council — ALEC — publishes model legislation for state lawmakers to introduce in their own chambers. Its Living Wage Mandate Preemption Act dates to 2002. The stated rationale is uniformity: businesses, the model argues, should operate under one wage standard rather than a patchwork.
When local minimum wage campaigns surged in the early 2010s, ALEC responded by promoting that model legislation and offering strategic support to legislators who wanted to block local increases.
It worked. Since 2012, when the Fight for $15 began, roughly a dozen states adopted minimum wage preemption. Twenty-five states now bar their own cities from raising the wage floor.
A city can vote for anything it likes. Whether the vote survives depends on a decision made somewhere else.
03 — The MoneyWho pays for the model bill.
ALEC describes itself as a membership organization of state legislators. Legislators pay dues — but those dues are a rounding error. The Center for Media and Democracy's review of ALEC's finances found that roughly 98% of its funding comes from sources other than legislator dues: corporations, trade associations, and corporate foundations.
Among those sources, tax filings show Koch money arriving consistently across three decades.
- 2009: Koch foundations gave ALEC over $200,000 — $125,000 from the Claude R. Lambe Charitable Foundation, $75,000 from the Charles G. Koch Foundation
- Through 2011: at least $600,000 cumulatively from Koch foundations, per CMD and Greenpeace analysis of Form 990 filings
- 2011: a $150,000 grant recorded in foundation tax filings obtained by the Center for Public Integrity
- 2017–2021: just over $2 million from Charles Koch's personal foundation and Stand Together Fellowships — CMD analysis of tax filings
- 2017–2021: $2.2 million routed through DonorsTrust, described as the Koch network's preferred donor conduit
- Undisclosed: Koch Industries has also paid membership dues to ALEC in amounts never made public
None of this is hidden in the sense of being illegal. It's hidden in the sense that almost nobody reads Form 990s. The filings are public. The connection between them and a vote in Montgomery is what nobody prints.
04 — The Scale$889 million, and what that number actually means.
In January 2015, at a donor summit in Rancho Mirage, California, the Koch network announced a budget of $889 million for the coming cycle. It was more than double what the network spent in 2012, and roughly what an entire national political party spent in a presidential year.
Two corrections belong with that number, and we're printing both.
First, the Washington Post — which broke the story — later appended a correction to its own headline: the $889 million was not all election spending. It included funding for think tanks, foundations, and universities.
Second, the network never hit the target. By mid-2016 it had scaled back to roughly $750 million, with about $250 million going to political and policy campaigns.
The honest version is that a private network planned to deploy close to a billion dollars across politics, policy, and academia in a single cycle, and ended up deploying about three-quarters of that. It is still more than any private network had ever spent.
05 — The RecordWhat happened when regulators were told the truth.
An argument for deregulation rests on a claim: that companies can be trusted to report honestly, and that heavy federal oversight is therefore waste.
There is a documented test of that claim, and it belongs on this page because the Justice Department published it.
In September 2000, a federal grand jury in Corpus Christi returned a 97-count indictment against Koch Industries, Koch Petroleum Group, and four employees, charging violations of federal air and hazardous waste law, conspiracy, and false statements to Texas environmental regulators. At issue was benzene — a chemical the EPA added to its hazardous air pollutant list in 1977 based on evidence linking it to leukemia in humans.
A superseding indictment followed in January 2001. On the day trial was scheduled to begin, Koch Petroleum Group pleaded guilty to covering up environmental violations. The company paid $20 million — $10 million in criminal fines and $10 million toward environmental projects in Corpus Christi — and served five years of probation. The Justice Department called it a record amount for an environmental prosecution.
The charges were reduced substantially before the plea. We note the sequence because it's part of the record. We don't assert why, because we can't document why.
- Indictment: DOJ press release, September 28, 2000
- Guilty plea: DOJ press release, April 9, 2001
- Penalty: $10M criminal fines + $10M environmental projects + 5 years probation
All of it is legal.
Correct, and we're not alleging otherwise except where a crime was actually charged. Political giving, model legislation, and lobbying are constitutionally protected. The question this page raises isn't whether laws were broken. It's whether a system in which they don't need to be broken is one you'd have designed.
Preemption has a real rationale.
It does. A company operating in forty municipalities faces forty wage floors, forty compliance regimes, forty sets of paperwork. That's a genuine cost and a serious argument. But Alabama had no state minimum wage. "Uniformity" there meant uniformity at $7.25 — not one state standard instead of many local ones, but no standard at all.
Legislators weren't forced to vote for anything.
True. Every vote was cast by an elected official who could have voted no. Model legislation is an offer, not an order. What the filings show is who wrote the offer and who paid for the organization that circulated it — which voters are entitled to know when weighing their representative's judgment.
The economics of minimum wage are genuinely contested.
They are. Serious economists disagree about employment effects, and anyone who tells you the question is settled is selling something. But that debate is about whether a raise is wise. Preemption doesn't win the argument — it removes the venue where the argument would happen.
The other side does this too.
Yes. Large fortunes on the left fund networks, model policy, and political campaigns by the same mechanisms. That's not a defense of this — it's the reason the question in the next paragraph is the one that matters.
06 — The QuestionNot two brothers.
It would be easier if this were a story about two men. Villains are satisfying, and they let you file the whole thing under people you already disliked.
But the machinery outlived one of them and kept running. The model bill still circulates. The foundations still file. The preemption laws are still on the books in twenty-five states, and the workers in those states still can't ask their own city for a raise.
So the question isn't whether you like the Kochs. It's narrower and harder than that:
Should any private fortune — anyone's — be able to overrule a city council?
If your answer changes depending on whose fortune it is, that's worth sitting with. It's the same answer either way, or it isn't an answer.
Everything above is linked to a filing, a docket, or an agency release. Follow them. If we've got something wrong, we'll correct it in public and say so.