SB261 Alabama 2023 Session

Summary

Primary Sponsor

Dan RobertsSenator

Republican

Session

Regular Session 2023

Title

Relating to public contracts; to prohibit governmental entities from entering into certain contracts with companies that boycott businesses because the business engages in certain sectors or does not meet certain environmental or corporate governance standards or does not facilitate certain activities; to provide that no company in the state shall be required by a governmental entity, nor penalized by a governmental entity for declining to engage in economic boycotts or other actions that further social, political, or ideological interests; to require the Attorney General to take actions to prevent federal laws or actions from penalizing, inflicting harm on, limiting commercial relations with, or changing or limiting the activities of companies or residents of the state based on the furtherance of economic boycott criteria; and to authorize the Attorney General to investigate and enforce this act; and to provide definitions.

Summary

SB261 would stop Alabama government entities from contracting with companies that boycott or fail to meet certain environmental or governance standards, and would protect Alabama companies from being forced to participate in such boycotts.

What This Bill Does

The bill prohibits governmental entities from entering into public contracts with companies that engage in economic boycotts of certain sectors or that do not meet specified environmental or corporate governance standards. It also prevents companies in Alabama from being required to engage in boycotts or penalized for not doing so. For covered contracts (those with 10+ employees and at least $15,000 paid from public funds), vendors must provide written verification that they will not engage in economic boycotts, with limited waivers possible if costs rise or quality declines; the Attorney General would enforce the act and oppose related federal actions. The act applies to contracts entered on or after October 1, 2023.

Who It Affects

• Government entities in Alabama (state agencies, counties, municipalities) would be restricted from contracting with companies that boycott certain sectors or fail to meet environmental/governance standards and from penalizing contractors for not engaging in such actions.
• Companies operating in Alabama with 10 or more full-time employees that may receive at least $15,000 from public funds would need to provide a written verification they will not engage in economic boycotts during the contract and could be shielded from penalties for choosing not to participate.

Key Provisions

• Defines key terms: Company, Economic Boycott, Governmental Entity, Ordinary Business Purpose.
• Contract rule: government entities may not contract with a company for goods or services unless the company provides written verification that it will not engage in economic boycotts during the contract; applies to contracts with 10+ employees and $15,000+ in public funds.
• Waivers/exceptions: allows waivers if compliance would significantly raise costs or reduce quality, with posting and objective justification on the entity’s website.
• Penalties prohibition: no party may penalize or threaten penalties for compliance with section requirements; harming the government entity is considered a violation.
• Company protections: companies cannot be forced to engage in boycotts or disclose information, and cannot be penalized for not taking such actions.
• Attorney General role: AG to oppose federal laws or actions that penalize Alabama firms for boycott criteria and to investigate/enforce the act.
• Enforcement and remedies: AG can enforce the act and pursue remedies; civil action may be available if the AG declines to enforce.
• Effective date: the act becomes effective for contracts entered into on or after October 1, 2023.

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