HB293 Alabama 2023 Session

Summary

Primary Sponsor

Chip BrownRepresentative

Republican

Session

Regular Session 2023

Title

Relating to port credits; to amend Sections 40-18-401 and 40-18-403, Code of Alabama 1975, to expand the cap of the port credit and to expand tax incentives for businesses and enterprises who increase their cargo volume through Alabama public ports.

Summary

HB293 expands port credits and tax incentives to encourage more cargo through Alabama ports and increases the program’s funding caps.

What This Bill Does

It revises how port credits are calculated and broadens eligibility to include a jobs credit when cargo volume increases. It raises the total amount of credits available over the life of the program to up to $20 million and sets a yearly cap of $5 million. Credits are based on increases in cargo volume over a base amount using per-unit rates for TEUs, net tons, air freight kilograms, and VEUs, with higher credits for larger increases. The bill allows unused credits to be carried forward up to five years, allows credits to be transferred if ownership changes, and creates an economic development pathway with specific investment and job requirements. Credits must be certified by the Department of Commerce before claiming and are administered by the Department of Revenue, with conditions, potential reductions, and recapture if project obligations aren’t met. The act takes effect for tax years after 2023, with implementation beginning January 1, 2024.

Who It Affects

• Port facility users and cargo shippers using Alabama public ports, who may qualify for port credits by increasing their cargo volume above their base level and by meeting minimum thresholds; they can offset state tax liabilities and may carry forward or transfer credits under certain conditions.
• State agencies and project developers involved in administering and receiving port credits (Department of Commerce, Department of Revenue, and the Governor/commission), who certify, manage, allocate, and monitor credits, and who may require proof of investment and job creation for economic development project credits.

Key Provisions

• Cap changes: lifetime port credits may total up to $20,000,000 and there is an annual cap of $5,000,000.
• Credit calculation: credits are awarded per unit of cargo (TEU, net ton, kg for air freight, and VEU) and are increased in tiers based on how much cargo volume exceeds the base amount.
• Eligibility thresholds: port users must exceed 105% of their prior 12-month cargo volume and meet minimum volumes (e.g., >10 TEU, >75 net tons, >15,000 kg for air freight, or >400 VEU).
• Administrative process: credits require certification by the Department of Commerce before claiming, with forms and deadlines set by the administering agencies; the Department of Revenue handles the tax credit.
• Offset, carryforward, and transfer rules: credits can offset tax liability (not below zero) and may offset estimated payments; unused credits can be carried forward up to five years and credits may be transferred if ownership assets are substantially transferred.
• Economic development allocations: up to $3,000,000 allocations for projects with at least $20,000,000 in investment and 75 new net jobs; credits for these projects may be granted for up to three years and require proof of investment and job creation; recapture provisions apply if the project obligations are not met.

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

Subjects

Port Incentives, expanded