HB35 Alabama 2018 Session

Summary

Primary Sponsor

Danny CrawfordRepresentative

Republican

Session

Regular Session 2018

Title

Taxation, sales and use tax, certain tax-exempt public water and sewer authorities, districts, boards, and systems eligible as government entities for certificates of exemptions from the Dept. of Revenue, Sec. 40-9-14.1 am'd.

Summary

HB 35 expands sales and use tax exemption eligibility to certain tax-exempt public water and sewer authorities and sets rules for applying exemptions to construction materials on government projects.

What This Bill Does

It adds specific tax-exempt public water or sewer authorities, districts, boards, and systems to the list of governmental entities eligible for exemption certificates from the Department of Revenue. It authorizes the Department to issue exemption certificates to these entities and to contractors/subcontractors for building materials that become part of exempt government projects (excluding highways, roads, or bridges). It requires contractors to maintain cost records and file reports on exempt purchases, imposes penalties for misuse, and allows the Department to adopt rules to enforce the program. It also clarifies that the program is intended to lower administrative costs and sets phased dates for applicability depending on the type of entity involved.

Who It Affects

• Government entities, including state, counties, municipalities, and school systems, that are tax-exempt and would receive exemption certificates for eligible projects (now including certain public water or sewer authorities, districts, boards, and systems).
• Contractors and subcontractors working on government projects, who may purchase building materials under exemption but must keep cost records, report exempt purchases, and could face penalties for misuse.

Key Provisions

• Amends Section 40-9-14.1 to add tax-exempt public water or sewer authorities, districts, boards, and systems to the governmental entities eligible for exemption certificates.
• Allows the Department of Revenue to issue exemption certificates to the governmental entity for each tax-exempt project and to contractors/subcontractors for building materials that become part of the project (excluding highway/road/bridge projects).
• Requires cost accounting of exempt purchases by contractors, mandates reporting as a condition for renewing exemptions, and imposes penalties for improper use, including potential civil penalties and suspension of exemptions for up to two years.
• Permits the Department to adopt rules to implement the section, emphasizes lower administrative costs, and sets operative dates limiting applicability to contracts entered after specific dates depending on entity type.

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