SB315 Alabama 2024 Session

Summary

Primary Sponsor

Bobby D. SingletonSenator

Democrat

Session

Regular Session 2024

Title

Alabama Rural, Agribusiness, and Opportunity Zone Jobs Act; certain state matching capital loans authorized, subject to appropriation

Summary

SB315 would let the Alabama Innovation Corporation provide state matching capital to certified growth funds to invest in rural, agribusiness, and minority-owned businesses, using federal SSBCI funds and only if the Legislature appropriates money.

What This Bill Does

It authorizes the creation of state matching capital programs for growth funds, with up to $50 million in investment authority and up to $25 million in SSBCI loans per fund, funded from federal SSBCI funds and state appropriations. Growth funds must invest in eligible growth businesses, particularly agribusiness and minority-owned firms, and in rural areas or designated opportunity zones, while meeting job creation and retention targets. The program sets loan terms (including 1% interest and potential forgiveness at exit), a repayment structure tied to matching capital, and a formal exit process after about seven years, with various performance and reporting requirements; the act only becomes operative if the legislature provides at least $12.5 million for FY 2024-2025.

Who It Affects

• Growth funds/certified growth funds and the Alabama Innovation Corporation would manage and use state matching capital and SSBCI loans to fund growth investments, with certification, investment limits, compliance rules, and potential penalties.
• Rural counties, agribusinesses, and minority-owned businesses in Alabama would be the primary recipients of investment capital and related job-creation opportunities as a result of the growth fund investments.

Key Provisions

• Authorizes issuance of state matching capital to certified growth funds, contingent on legislative appropriation.
• Repeals the ARP-related Section 40-9H-9 legislative intent and makes the act operative only upon a specified appropriation.
• Establishes the SSBCI Fund and allows SSBCI loans; initial funding includes up to $25 million from ARP funds and up to $25 million from state appropriations.
• Allows a growth fund to receive up to $50 million in investment authority and up to $25 million in SSBCI loans; approvals are subject to department caps and pro rata reductions if applications exceed limits.
• Defines growth fund and growth business; growth businesses must be eligible and meet certain criteria (including industry and location requirements, with emphasis on agribusiness and minority-owned firms).
• Requires follow-on capital to be at least 50% of the initial growth investment and includes other financing; 50% of follow-on capital and new annual jobs retained percentages determine forgiveness and annual job metrics, with potential adjustments.
• Imposes investment targets: at least 25% of investments in agribusiness, at least 25% in minority-owned businesses, and at least 50% in growth investments located in rural areas or qualified opportunity zones.
• Growth funds must relocate or hire new employees so that principal operations are in growth zones within 180 days of receiving the investment, if feasible.
• SSBCI loan terms include 1% interest, forgiveness at exit equal to the sum of follow-on capital and new annual/jobs retained percentages (not available if the loan is accelerated), and subordinations to matching capital (revocable under certain conditions).
• Draws on the SSBCI loan are limited to 50% of the proposed growth investment amount, with procedures for transferring funds and returning unused draws.
• Program exit is allowed after the seventh anniversary, with distributions prioritized to repay debt, then management fees, then remaining SSBCI loan amounts, and finally equity holders.
• The department must certify growth funds, set investment authority and loan amounts, and monitor compliance; penalties apply for under-investment or noncompliance with stated thresholds.
• The Department shall report to the Legislature starting in 2023-2026 assessing the incentives in this chapter, and the act becomes effective upon a specified date and operative upon appropriation.

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

Subjects

Economic Development