House Bill 566 Alabama 2026 Session

Summary

Primary Sponsor

Paul W. LeeRepresentative

Republican

Session

2026 Regular Session

Title

Municipalities; business license for certain businesses in the building trade provided for

Summary

HB566 would limit when municipalities can levy business licenses on certain building-trade businesses and set rules for calculating and crediting those fees.

What This Bill Does

It adds a new section to Alabama law that specifies which building-trade businesses may be licensed by municipalities and defines those business types. It allows municipalities to impose licenses on listed businesses that perform work inside a municipality but do not have a physical location there, with license fees that can be flat or based on gross receipts. It lets these businesses exclude receipts earned in other municipalities when calculating fees if they maintain a physical place of business in the municipality where the license is filed, and it allows municipalities to verify this with documentation. It also prevents municipalities from requiring these businesses to obtain a municipal license for county government projects on county property or county-maintained roads, with the new rules taking effect October 1, 2026.

Who It Affects

• Certified heating and air conditioning contractors operating without a physical location in the municipality
• Certified refrigeration contractors
• Concrete providers
• Duct air tightness testing contractors
• Electrical contractors
• General contractors
• Journeyman electricians
• Master gas fitters
• Master plumbers
• Onsite wastewater licensees
• Residential home builders
• Subcontractors
• Municipalities
• County governments (regarding county-project exemptions)

Key Provisions

• Adds Section 11-51-133 to define eligible building-trade businesses for municipal licensing.
• Allows municipalities to license listed businesses that work within the municipality but lack a physical location there.
• License fees may be a flat amount or based on gross receipts from work performed in the municipality.
• Requires that businesses may exclude gross receipts used to calculate fees in other municipalities if they have a physical place of business in the current municipality; municipalities may verify this with a requested receipts/licenses list.
• Prohibits municipalities from requiring listed businesses to obtain a municipal license for county government projects on county property or county-maintained infrastructure.
• Effective date set for October 1, 2026.

AI-generated summary using openai/gpt-5-nano-2025-08-07 on Mar 5, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Counties & Municipalities