HB310 Alabama 2024 Session

Summary

Primary Sponsor

Terri CollinsRepresentative

Republican

Session

Regular Session 2024

Title

Rural Hospital Investment Program established, tax credits for donations to rural hospitals authorized

Summary

HB310 creates a Rural Hospital Investment Program that offers state income tax credits to encourage donations to Alabama's rural hospitals to support care and facility improvements, overseen by a new board.

What This Bill Does

It establishes the Rural Hospital Investment Program and a dedicated board within the State Treasurer's Office to oversee eligibility and administration, with coordination from the Department of Revenue. It authorizes a state income tax credit for qualified donations to eligible rural hospitals, with different annual limits for individuals, married couples, pass-through entities, and corporations; credits are nonrefundable and may be carried forward up to three years, starting with the 2025 tax year. It sets eligibility criteria for hospitals (types of rural hospitals, location, service to Medicaid/Medicare, indigent care, compliance, and a five-year plan) and caps the amount of credits a hospital can receive per year (no more than $2 million) while outlining overall annual program caps that rise from $38 million in 2025 to $60 million in 2026 and $80 million from 2027 onward. It requires annual reporting by hospitals and a joint report from the board and Department of Revenue to the Legislature, and requires lists of eligible hospitals to be published for upcoming tax years.

Who It Affects

• Donors (individuals and entities): can receive a state income tax credit for donations to eligible rural hospitals, with annual limits and nonrefundable credits that can be carried forward up to three years.
• Eligible rural hospitals (rural general acute, rural emergency, or critical access): may receive donations to fund care, operations, and facility improvements, and must meet location and service criteria as well as reporting requirements.
• Hospitals' patients (Medicaid/Medicare participants and indigent patients): hospitals must provide services without discrimination and to indigent patients, supported indirectly by donations.
• Alabama Hospital Association and its representatives: contribute to board membership and governance as part of the program administration.
• State agencies (Office of the State Treasurer and Department of Revenue): administer the program, preapprove donations, publish eligible hospital lists, and coordinate reporting.
• Legislature and public: receive annual and joint reports on donations and tax credits to monitor the program.

Key Provisions

• Creates the Rural Hospital Investment Program and the Rural Hospital Investment Program Board within the Office of the State Treasurer to oversee development and operation, with coordination from the Department of Revenue.
• Defines eligible rural hospitals as rural general acute care, rural emergency, or critical access hospitals licensed by the Department of Public Health and located in a rural area per CMS rural definitions; requires Medicaid/Medicare services with nondiscriminatory care and indigent care.
• Establishes a state income tax credit for qualified donations, with 100% credit of the donated amount in the initial year and each subsequent year, subject to per-year limits: individuals up to $15,000 (single/HoH/separate filing), married filing jointly up to $30,000, pass-through entities up to $450,000 per year, and C corporations up to $500,000 per year.
• Sets annual program caps on total credits: $38 million for 2025, $60 million for 2026, and $80 million from 2027 onward, with a per-hospital cap of no more than $2 million per tax year; credits cannot exceed tax liability and unused credits can be carried forward up to three years.
• Requires preapproval by the Department of Revenue for qualified donations and imposes reporting requirements: hospitals file an annual report by March 1; the board and Department prepare a joint report for the Legislature by the fourth quarter with details on donations and credits.
• Requires hospitals to submit a five-year viability and spending plan, and to update it every five years; allows a hospital to pay up to 5% of donations as a management/solicitation fee, with total fees capped at 5% of annual donations.
• Mandates annual determination of eligible hospitals by November 1 each year and publication of eligible hospital lists by December 31 for the next tax year; hospital lists are shared with the Department of Revenue.
• Authorizes the program to be administered through rules under the Alabama Administrative Procedure Act and allows the Board to contract with an Alabama company to publicize the program and develop materials and a website.

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

Subjects

Health