SB351 Alabama 2023 Session

Summary

Primary Sponsor

Linda Coleman-MadisonSenator

Democrat

Session

Regular Session 2023

Title

To amend Section 40-12-242, Code of Alabama 1975, relating to license taxes and registration fees; to levy an additional license tax and registration fee on motor vehicles as defined in Section 40-12-240, Code of Alabama 1975; and to provide for the distribution of the proceeds to the Alabama Public Transportation Trust Fund.

Summary

SB351 would raise new vehicle taxes and fees (including for electric vehicles) and create funding streams to improve public transportation and electric vehicle charging infrastructure in Alabama.

What This Bill Does

It adds new annual license taxes and registration fees for vehicles ($13 for private passenger autos and $7 for motorcycles) and imposes higher annual fees of $200 for battery electric vehicles and $100 for plug-in hybrids, with a $3 increase every four years. Beginning January 1, 2024, a separate $5 annual fee is charged on each motor vehicle, and all proceeds from that fee go to the Alabama Public Transportation Trust Fund to support public transportation improvements. The bill defines battery electric and plug-in hybrid vehicles and sets floor reductions if a federal surcharge is used for highway purposes, but the EV fees cannot drop below $150 (battery) and $75 (plug-in hybrid). It creates the Electric Transportation Infrastructure Grant Program within the Department of Transportation to fund electric vehicle charging infrastructure. Proceeds from the EV fees are initially split: 66.67% to the state, 25% to counties, and 8.33% to municipalities from the first $150/$75, with the remainder going to the Rebuild Alabama Fund to support charging infrastructure until EV registrations reach 4% of total registrations; after that threshold, the EV fees are reduced to $150/$75 and receipts continue to be distributed to the state, counties, and municipalities for road-related uses via the Rebuild Alabama Fund. The act also redirects all remaining proceeds to fund road, highway, and bridge projects.

Who It Affects

• Private passenger automobile owners would pay an increased annual license tax (up to $13) and registration fee.
• Motorcycle owners would pay an increased annual license tax (up to $7) and registration fee.
• Battery electric vehicle owners would pay a $200 annual fee (with potential reductions if federal surcharges are used for highway purposes, but not below $150).
• Plug-in hybrid vehicle owners would pay a $100 annual fee (with potential reductions if federal surcharges are used for highway purposes, but not below $75).
• Counties and municipalities could receive portions of EV-fee proceeds to support transportation infrastructure.
• The Rebuild Alabama Fund would receive the remainder of EV-fee proceeds to fund road, highway, and bridge projects (and EV charging infrastructure until EV shares reach 4%).
• The Alabama Department of Transportation would administer the Electric Transportation Infrastructure Grant Program for EV charging infrastructure.
• ADECA would use the new Public Transportation Trust Fund (from the $5 fee) to improve public transportation options statewide.

Key Provisions

• Amendment to §40-12-242: add $13 annual license tax for private passenger autos and $7 annual license tax for motorcycles.
• Establish $200 annual license tax/fee for battery electric vehicles and $100 annual license tax/fee for plug-in hybrid electric vehicles; definitions provided for each vehicle type.
• Require a $3 increase in the additional EV license taxes/fees every four years beginning July 1, 2023.
• Allow reductions of battery EV and plug-in hybrid fees if a future federal highway surcharge is used in Alabama, with floor amounts of $150 (battery) and $75 (plug-in hybrid).
• Create the Electric Transportation Infrastructure Grant Program within the Department of Transportation to fund EV charging infrastructure, with rules governing applications, evaluations, and grant distribution.
• Distribute EV-fee proceeds in two phases: initially 66.67% to state, 25% to counties, 8.33% to municipalities from the first $150/$75, with the remainder funding the Rebuild Alabama Fund for charging infrastructure until EV registrations reach 4% of total; thereafter, EV-fee receipts are reduced to $150/$75 and distributed to the same entities for road-related uses via the Rebuild Alabama Fund.
• All funds from the Rebuild Alabama Fund may be used for construction, reconstruction, maintenance, and repair of roads, highways, and bridges, and for other lawful purposes; unspent proceeds continue to fund the Electric Transportation Infrastructure Grant Program.
• Impose a new $5 annual license tax/registration fee on each motor vehicle starting January 1, 2024, with all proceeds deposited into the Alabama Public Transportation Trust Fund to be used by ADECA to expand public transportation options statewide.
• Effective date: the act becomes effective on the first day of the third month after passage, with other related provisions continuing to apply.

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