SB220 Alabama 2015 Session

Summary

Primary Sponsor

Bill Hightower

Republican

Session

Regular Session 2015

Title

Energy efficiency projects, financing by local governments authorized, non ad valorem tax assessments, liens, bonds authorized, Property Insurance and Energy Reduction Act of Alabama

Summary

SB220 lets Alabama counties, municipalities, or improvement districts finance energy efficiency and flood/storm resilience improvements on real property by issuing bonds and placing assessments on the property tax bill, secured as liens.

What This Bill Does

Local governments can designate regions within their jurisdiction to finance qualifying projects. They may issue bonds or use other financing to cover costs, repaid by assessments on real property that benefits from the projects, with liens that run with the property. The program defines qualifying improvements such as wind resistance, energy efficiency measures, and flood mitigation, and imposes a 20% cap on the assessment of a property's value unless an energy, wind, or flood audit shows savings that cover the annual repayment. The state provides oversight, and mortgage lenders must consent and subordinate to the assessment lien; contracts are recorded and buyers receive disclosures about the assessment.

Who It Affects

• Real property owners in a designated region who may be charged a non ad valorem assessment to fund a qualifying project and must sign a contract and consent/subordination with existing lenders.
• Local governments (cities, counties, or improvement districts) that designate regions, issue financing, levy assessments, hire staff, and oversee program administration.
• Mortgage lenders and other lienholders who must consent to the assessment and subordinate their lien to the new assessment lien; they must be notified before enforcement actions.
• Property buyers who will receive disclosures at sale informing them about the assessment and that it is not based on property value.

Key Provisions

• Allows designated regions within a local government to fund qualifying projects by issuing bonds or notes and imposing assessments on benefited real property.
• Assessments are liens on the property, payable from specified sources, and have priority similar to other taxes once mortgage lender consent/subordination is recorded.
• Qualifying projects include wind resistance improvements, energy conservation and efficiency measures, and flood mitigation projects, with defined cost categories and eligibility rules.
• Total assessments may not exceed 20% of the property's just value, unless an approved energy/wind/flood audit shows savings that cover the annual debt service.
• Contracts with property owners must be recorded, specify lien details, and require mortgage consent and subordination; buyers receive a disclosure statement about the assessment.
• Local governments may hire program administrators, charge fees to offset costs, and may contract with other governments or third-party administrators.
• The state may regulate the programs through a designated agency, issue rules, and provide initial guidance within 12 months.
• A loss reserve fund may be established to cover delinquent assessments; enforcement procedures for liens are similar to other tax liens, with notice requirements for lienholders.

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

Subjects

Energy