HB247 Alabama 2023 Session

Summary

Primary Sponsor

Anthony DanielsRepresentative

Democrat

Session

Regular Session 2023

Title

Relating to economic development; to amend Sections 41-10-802 and 41-10-822, Code of Alabama 1975, to provide for a name change for the Alabama Innovation Corporation and revise the residency requirements for certain grant recipients; to amend Section 41-10-805, Code of Alabama 1975, relating to the Board of Directors of the Alabama Innovation Corporation, to make conforming changes to accurately cite the Code of Alabama 1975; and to add a new Article 22, commencing with Section 41-10-840, to Chapter 10 of Title 41, Code of Alabama 1975, to reestablish the technology accelerator tax credit program and the underrepresented company tax credit program as the Innovating Alabama tax credit program; and to exempt working groups, task forces, and subcommittees of the Alabama Innovation Corporation from the Alabama Open Meetings Act.

Summary

HB247 renames the Alabama Innovation Corporation to Innovate Alabama, tightens grant residency rules, creates the Innovating Alabama tax credit program for accelerators and underrepresented companies, and exempts Innovate Alabama groups from Open Meetings laws.

What This Bill Does

It changes the name of the public tech-development entity to Innovate Alabama and adds a one-year window to establish Alabama as the principal place of business, with top executives and most employees residing in Alabama to qualify for grants. It establishes the Innovating Alabama tax credit program, allowing economic development organizations to obtain credits to support accelerators and underrepresented companies tied to federal SBIR/STTR awards, with defined funding caps, application rules, and reporting requirements. It requires grant agreements to enforce state residency and use of funds, provides credit administration through an online system, sets transfer and deduction rules, and imposes an annual cap on credits while reserving funds for specific projects. It also exempts the governing working groups, task forces, and subcommittees of Innovate Alabama from the Open Meetings Act.

Who It Affects

• Group 1: Businesses and startups seeking SBIR/SBTR matching grants from Innovate Alabama, which will require establishing Alabama as the principal place of business within one year, and having a majority of top executives and employees reside in Alabama to be eligible.
• Group 2: Economic development organizations (local and state) and Innovate Alabama staff/committees that administer the Innovating Alabama tax credit program, including responsibilities for grant administration, reporting, conflict-of-interest policies, funding allocations, and exemptions from Open Meetings Act.

Key Provisions

• The Alabama Innovation Corporation may be known as Innovate Alabama, with the name change included in the public incorporation forms and references.
• Grant eligibility for SBIR/SBTR requires a one-year window to establish Alabama as the primary place of business, and residency of a majority of top executives and 75% of employees in Alabama for five years after grant, in addition to existing requirements.
• Creation of the Innovating Alabama tax credit program (Article 22) to support accelerators and programs for innovative and underrepresented companies, including defined terms, eligible applicants, and project criteria.
• Credit mechanics: the lesser of 50% of the federal SBIR/SBTR award or specific grant amounts ($100,000 for Phase I matching; $250,000 for Phase II matching), with a calendar-year cap of $25 million, and at least $10 million reserved for certain targeted projects.
• Credit administration: credits claimed through an online system, with restrictions on deductions, no transferability, and five-year carry-forward limits; funding subject to annual appropriation and department rules.
• Grant agreements require use of funds for approved purposes, annual or periodic reporting, and performance/economic impact reporting, plus recapture provisions if the entity defaults (except in cases of going concern issues).
• Open Meetings Act exemptions for working groups, task forces, and subcommittees of Innovate Alabama; Section 3 clarifies these groups are not subject to Chapter 25A.
• Administrative coordination with the Department of Commerce through a short-term memorandum of understanding to manage aspects of the Innovating Alabama tax credit program.

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