House Bill 262 Alabama 2026 Session

Summary

Primary Sponsor

Kelvin LawrenceRepresentative

Democrat

Session

2026 Regular Session

Title

Taxation; state privilege tax on historical racing activities, further provided; local taxes, repealed

Summary

HB262 would limit historical racing to six named locations, replace existing taxes with a 4% state net-revenue tax on licensees, and repeal several local gambling taxes, with changes taking effect October 1, 2026.

What This Bill Does

It restricts where pari-mutuel wagering on historical racing and bingo can occur to six designated sites in Alabama. It creates a new 4% state privilege tax on the net revenues of each licensee conducting historical racing, and this tax would be in lieu of all other state or local taxes on that activity. It preserves the current commission take-out from pari-mutuel pools (19% for bets with two or fewer selections and 21% for three or more), and the tax cannot require licensees to raise commissions. It adds a provision that wagering on historical racing computer machines may occur only at authorized locations and limits expansion beyond what is allowed as of October 1, 2026, while repealing several existing local pari-mutuel taxes.

Who It Affects

• Historical racing operators/licensees at the six authorized locations in Alabama (Greene County, Jefferson County, Macon County, Mobile County, a Class C Bingo Permit holder in Houston County, and a bingo facility in Lowndes County) — would pay a new 4% of net revenues state tax and continue to collect the existing take-out percentages, but cannot pass the tax onto higher commissions.
• Local governments and residents across Alabama — local pari-mutuel taxes would be repealed and a uniform local privilege tax on local gambling revenues would be established, potentially changing local government revenue and funding related to these activities.

Key Provisions

• Authorized locations for historical racing and bingo are six named sites in specified counties (Greene, Jefferson, Macon, Mobile, plus Houston County bingo location and a Lowndes County facility).
• Impose a new 4% state privilege tax on the net revenues of licensees conducting historical racing, replacing all other state or local taxes on this activity, effective October 1, 2026.
• Maintain existing pari-mutuel take-out levels (19% or 21% of pools, depending on bet type) and require the tax not to force licensees to raise commissions to pay the tax.
• Add Section 40-26A-2.1 to restrict historical racing wagering to authorized locations and prevent expansion beyond what is permitted as of October 1, 2026.
• Repeal several existing local taxes on pari-mutuel pools in various counties (11-65-29, 11-65-30, 11-65-35, 45-44-150.12, 45-32-150.13, 45-49-151.14).
• Establish a uniform local privilege tax on certain local gambling revenues.

AI-generated summary using openai/gpt-5-nano on Feb 11, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Gaming