House Bill 379 Alabama 2026 Session

Summary

Primary Sponsor

Terri CollinsRepresentative

Republican

Session

2026 Regular Session

Title

Entertainment Industry Incentive Act of 2009 amended, create additional incentive program, extend review and evaluation deadline

Summary

HB379 adds a new small-budget production rebate, clarifies loan-out compensation, extends the incentive review deadline, and updates tax exemption rules under Alabama's Entertainment Industry Incentive Act.

What This Bill Does

It creates a new small-budget Qualified Production rebate of 45% of payroll paid to Alabama residents for state-certified productions with expenditures between $100,000 and $499,999, with a yearly cap of $2,000,000 for these projects. It preserves the existing state-certified rebate structure (25% of production expenditures plus 35% of Alabama resident payroll) but raises the overall annual cap to $22,000,000 starting in fiscal year 2026 and allows unused funds to roll over up to $3,000,000, with $2,000,000 reserved for music albums. It clarifies how compensation paid to loan-out companies can be counted toward rebates, subject to specified withholding conditions, and it extends the deadline for the Department of Commerce to contract with an out-of-state evaluator to report findings to the Legislature on the 1st day of the 2027-2028 Regular Session. It also changes the sales, use, and lodging tax exemption process by requiring a minimum $150,000 expenditure forecast, issuing exemption certificates, and outlining reporting and penalties if the threshold is not met, while keeping the exemptions tied to state taxes.

Who It Affects

• Qualified production companies and Alabama residents working on those productions: they would have access to a new 45% payroll rebate for small-budget projects and would be subject to updated payroll counting rules for loan-out arrangements.
• State agencies and the Legislature: the Department of Commerce and the Department of Revenue would administer the new program, manage exemptions and caps, contract for external evaluation, and report findings to lawmakers.

Key Provisions

• Create a new Small Budget Qualified Production rebate: 45% of Alabama-resident payroll for state-certified productions with expenditures of $100,000-$499,999, up to a $2,000,000 annual cap.
• Maintain the existing state-certified rebate: 25% of production expenditures (excluding resident payroll) plus 35% of Alabama-resident payroll, with a cap tied to the first $20,000,000 of expenditures.
• Increase annual incentives cap to $22,000,000 for fiscal years starting 2026, reserve $2,000,000 for music albums, allow carryover of unspent incentives up to $3,000,000.
• Clarify loan-out compensation rules: count certain withholdings as payroll for rebate calculations under specified tax conditions.
• Extend evaluation reporting deadline: require the Department of Commerce to contract an out-of-state entity to review incentives and report to the Legislature on the 1st legislative day of the 2027-2028 Regular Session.
• Sales/use/lodging tax exemptions: require a $150,000 expenditure forecast to qualify, issue exemption certificates, report actual expenditures after completion, and impose penalties if thresholds aren’t met; exemptions apply only to state taxes.
• Repeal and continuation: the Entertainment Industry Incentive Act of 2009 would repeal December 31, 2028 unless extended, with pre-existing credits unaffected.

AI-generated summary using openai/gpt-5-nano on Feb 12, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Economic Development