HB58 Alabama 2015 Session

Summary

Primary Sponsor

Alan BakerRepresentative

Republican

Session

Regular Session 2015

Title

Economic development, job credit and investment credit for approved projects, capital credits repealed and reenacted, credit against utility taxes, income taxes, financial institution excise taxes, and insurance premium taxes, Alabama Jobs Act, Secs. 40-21-87, 40-21-107 am'd; Secs. 40-18-370 to 40-18-381, inclusive, added; Secs. 40-18-190 to 40-18-203, inclusive, 40-18-205 to 40-18-215, inclusive, 40-18-240 to 40-18-250, inclusive, repealed

Summary

The Alabama Jobs Act creates 10-year job and investment tax incentives for approved projects that create new Alabama jobs, with strict eligibility, oversight, and a sunset.

What This Bill Does

It provides a jobs credit of 3% of the prior year's wages for eligible employees, usable as a refund or credit against utility taxes with a 10-year incentive period; it also provides an investment credit of 1.5% of qualifying capital investment annually for 10 years, usable against various taxes and with carryforwards. It requires project agreements, uses findings that net benefits exceed costs, and establishes audits, clawbacks, and a permanent Joint Legislative Advisory Committee on Economic Incentives. It repeals existing incentive provisions for new projects, sets a funding cap and sunset, and redirects certain tax revenues to Education Trust Fund and Special Mental Health Trust Fund, while allowing transitional arrangements for prior incentives.

Who It Affects

• Approved companies (and related companies) that undertake qualifying projects and may receive the Jobs Act Incentives (jobs credit and investment credit) under project agreements.
• Employees in Alabama who become eligible for new jobs (and their wages drive the credits); state agencies (Department of Commerce, Revenue, Labor, Finance) that administer, audit, and regulate the credits; and state education and mental health funds affected by tax distributions.

Key Provisions

• Jobs Act Incentives: 3% of wages paid to eligible employees each year for 10 years, applied against utility taxes, with options for refunds during the incentive period or as credits against taxes with a five-year carryforward.
• Investment Credit: 1.5% of a qualifying capital investment annually for 10 years, offsetting income tax, financial institution excise tax, insurance premium tax, and utility taxes, with carryforward up to five years and possible transfer in the first three years under restricted conditions.
• Project eligibility and organization: requires designated activities, minimum new jobs, a project agreement between Governor and incentivized company, and findings by the Secretary of Commerce and Governor that net state revenues will exceed incentives.
• Oversight and enforcement: includes audits by Revenue and Labor, potential clawbacks for unearned credits, penalties for noncompliance, and a permanent Joint Legislative Advisory Committee on Economic Incentives to monitor and report findings.
• transitional and fiscal rules: repeals certain prior incentive provisions, caps total outstanding incentives at $850 million, places a sunset, and restricts incentives for projects with agreements after December 31, 2019 unless continued by law.

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

Subjects

Economic Development