HB13 Alabama 2014 Session

Summary

Primary Sponsor

Oliver Robinson

Democrat

Session

Regular Session 2014

Title

Real property, affordable rental housing, appraisal of certain Class II property having restrictions by law or covenant must take into account net operating income based on restrictions, requiring Revenue Department to adopt rules to implement

Summary

HB13 would change how Alabama values Class II affordable rental housing for property taxes by requiring valuations to reflect restricted occupancy income and NOI, using Department of Revenue–set capitalization rates, and excluding most tax credits from value unless retained by the owner.

What This Bill Does

It would require the appraised fair market value for ad valorem tax purposes of Class II affordable rental housing to be based on the property's actual net operating income, adjusted for occupancy and rental restrictions, with capitalization rates determined annually by the Department of Revenue. It would require assessors and boards to consider the impact of legal restrictions and covenants on occupancy and rentals, and to exclude the value of tax credits from the appraisal unless the owner uses them. It would require the Department of Revenue to issue implementing rules and to determine capitalization rates, and to ensure statewide application. It would require property owners to file annually with the county tax assessor sworn statements of actual gross and net operating income and the value of government grants or subsidies used to support restricted rents.

Who It Affects

• Owners of Class II affordable rental housing, who would see valuation methods affected by restricted occupancy income and who must annually report income and subsidies.
• County tax assessors, boards of equalization, revenue commissioners, and Department of Revenue staff, who would implement and apply the new valuation rules statewide.

Key Provisions

• Appraisal of Class II affordable rental housing must reflect actual net operating income attributable to the property under occupancy restrictions, using annual capitalization rates set by the Department of Revenue, with replacement cost allowed only if it yields a value less than the income-based value.
• Tax credits or subsidies tied to the affordable housing cannot be counted in property value or net income for ad valorem purposes unless the credits are directly used by the owner; the Department of Revenue must promulgate rules to implement this, and owners must annually report income and subsidies; the changes apply starting October 1, 2013 and statewide thereafter.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Ad Valorem Tax