HB507 Alabama 2020 Session

Summary

Primary Sponsor

Rod Scott

Democrat

Session

Regular Session 2020

Title

Class 1 mun. (Birmingham), business improvement districts, self-help, requirements to estab., amend, expand, and terminate, Secs. 11-54B-5, 11-54B-7, 11-54B-10, 11-54B-19 am'd.

Summary

HB507 updates how Class 1 municipalities create and manage self-help business improvement districts, including formation rules, amendments, expansions, and termination processes.

What This Bill Does

It sets strict requirements for creating a self-help district, including signatures from property owners representing a large share of district FMV, a detailed district plan with services, a budget, and an assessment method for up to five years. It allows a municipality to designate and maintain the district after a public hearing, but if enough owners object (by number), the district can be nullified. It also tightens rules for amending, expanding, or reducing a district, requiring appropriate signatures, notices, and contract changes to maintain service levels, and it establishes procedures for continuing, modifying, or terminating a district after annual budgets. The bill clarifies that districts created before it takes effect are still subject to its provisions for future actions.

Who It Affects

• Real property owners within the proposed or existing self-help district (their signatures and FMV contribute to district creation and expansion decisions; they may pay special assessments).
• The district management corporation (the entity that would provide administrative and other services and sign contracts with the municipality).
• The municipality (the city or town government, which would adopt ordinances, set effective dates, and oversee district operations).

Key Provisions

• §11-54B-5: Creation requires signatures of owners representing at least two-thirds one-half of the total fair market value of all real property in the proposed district; includes description of the district, a district plan with services and budget, method for determining assessments, duration up to five years, and copies of the district management corporation's articles and by-laws.
• §11-54B-7: The municipality may adopt an ordinance to designate and maintain the district after a public hearing; the ordinance has a 60-day effective date; if owners representing one-third (or more by number) file objections, the district is void; designates the district management corporation and authorizes a contract between the municipality and that corporation.
• §11-54B-10: Amendments can be requested by the district management corporation or a representative group of property owners; expansions require signatures representing at least two-thirds one-half of FMV from newly included property; notices and public hearings are required for reductions or expansions; contracts must be amended to maintain the same level of municipal services; no contiguity requirement for district boundaries.
• §11-54B-19: After the fifth annual budget, the district management corporation must hold a hearing on continuation, modification, or termination; petitions from substantial property owner groups can trigger hearings; after the hearing, the district may continue, modify, or terminate; if a significant portion of property owners or parcels object, the district may be terminated.
• Section 2: Preexisting districts are not made to change immediately, but any district existing before the act must follow the remaining provisions for future actions.
• Section 3: The act takes effect immediately after approval.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Class 1 Municipalities