HB394 Alabama 2016 Session

Summary

Primary Sponsor

Mac McCutcheon

Republican

Session

Regular Session 2016

Title

Gasoline tax, add'l tax provided for, adjusted under certain conditions, add'l local taxes or gasoline prohibited, additional fees for certain alternative fuel vehicles, Sec. 40-17-325 am'd.

Summary

HB394 would raise gasoline and diesel taxes to align with border-state averages, trigger periodic rate adjustments, create dedicated funding for transportation safety, restrict local fuel taxes unless approved by voters, and add annual fees for alternative fuel vehicles.

What This Bill Does

It adds an extra amount to gasoline and diesel taxes equal to the difference between Alabama's tax and the border-state average, starting in 2016, with the new money going to the Alabama Transportation Safety Fund. The difference is recalculated in 2019, 2023, and 2027, and any change to the rate would take effect on October 1 of those years unless the Legislature votes to keep the current rate. It bars local governments from imposing their own gasoline or diesel taxes without a voter referendum, though a local vote could allow up to 2 cents per gallon if the state rejects the adjustment; any local revenue would go into a separate fund for projects authorized in SB180. It also imposes annual fees for alternative fuel vehicles: $100 for private passenger vehicles and $150 for commercial vehicles, with all fees going into the same Transportation Safety Fund.

Who It Affects

• Alabama gasoline and diesel buyers and the businesses that collect and remit the fuel excise taxes, who would see the tax amount increase by the difference with border states and would be responsible for collecting the new rates.
• Local governments and residents, who could be affected by new rules restricting local fuel taxes (and the possibility of a local 2-cent per gallon tax) and by the allocation of local tax revenue to transportation safety projects under SB180; owners of alternative fuel vehicles would also pay new annual fees.

Key Provisions

• Imposes additional excise taxes on gasoline and diesel equal to the difference between the Border States Average Gasoline Tax and the Alabama Tax on Gasoline, starting October 1, 2016, with revenue deposited into the Alabama Transportation Safety Fund.
• Requires recalculation of the border-state tax difference in 2019, 2023, and 2027; rate changes take effect October 1 of the following year unless a joint resolution keeps the current rate; after 2027, adjustments require a separate act.
• Prohibits local laws imposing a local gasoline or diesel tax unless approved by referendum; allows local referendums for up to 2 cents per gallon if the Legislature adopts a resolution rejecting the adjustment; local revenue funds go to a separate, SB180-authorized transportation safety fund.
• Adds annual fees for alternative fuel vehicles: $100 for private passenger vehicles and $150 for commercial vehicles, with the funds deposited into the Alabama Transportation Safety Fund and spent per SB180.
• Defines terms for alternative fuel vehicles (including electric, hybrid, solar, and other non-petroleum methods) and clarifies that these fees apply to vehicles registered for operation on public roads.
• The act becomes effective after gubernatorial approval but is implemented only upon passage of SB180.

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

Subjects

Taxation