HB 243 Alabama House · 2025 Regular Session

To unabate a portion certain state ad valorem and construction related transaction taxes to deposit into the Alabama Development Fund.

HB 243 reverses certain tax breaks for new industrial property tax abatements granted on or after June 1, 2026. It requires collecting 1.0 mill of state ad valorem taxes and 0.75% of construction transaction taxes that would have been waived, directing these funds into the new Alabama Development Fund. The bill applies only to future abatements (not existing agreements) and mandates the Department of Revenue to share abatement data with the Department of Commerce for economic development planning. The Alabama Development Fund, managed by the Department of Commerce, will use these funds for economic development initiatives, with unspent balances carried forward annually.

Issues: ✓ Budget & Taxes

Bill status signed all 5 stages cleared

Introduction

Feb 2025

Committee Review

Feb 2025

House Passage

Feb 2025

Senate Passage

Mar 2025

Signed into Law

Apr 2025

Introduced Feb 11, 2025 Signed Apr 3, 2025

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What changed between versions

Introduced → Enrolled · 4 edits · Apr 3, 2025

MODERATE

This bill was finalized and enrolled after being introduced, with substantive changes to the tax abatement policy. The bill now creates a new Alabama Development Fund and requires that 1.0 mill of noneducational ad valorem taxes and 0.75% of construction transaction taxes be collected and deposited into this fund instead of being fully abated. The changes also establish new information-sharing requirements between state departments and set specific effective dates for the new provisions.

Scope change

The bill's scope expanded from a general tax abatement framework to include specific funding mechanisms and inter-agency information sharing requirements that were not present in the introduced version.

FISCAL

Created the Alabama Development Fund to receive unabated tax revenues, replacing the previous approach where tax abatements were fully exempt.

REQUIREMENT

Added requirement for Department of Revenue to share abatement information with Department of Commerce for economic development planning purposes.

TIMELINE

Set specific effective dates: Sections 1-4 apply to abatements granted on or after June 1, 2026, while Section 5 takes effect October 1, 2025.

TECHNICAL

Added certification language and signature blocks for House and Senate officials to formalize the enrolled status of the bill.

Floor votes

How they voted

This bill passed the Senate by voice vote (no roll call recorded).

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Mar 18, 2025

Upper · Passed

Motion to Read a Third Time and Pass - Adopted Roll Call 324

upper

Feb 19, 2025

Upper · Passed

Reported Out of Committee Second House

upper

Feb 18, 2025

Upper · Passed

Pending Committee Action in Second House (Fiscal Responsibility and Economic Development)

upper

Feb 13, 2025

Lower · Passed

Motion to Read a Third Time and Pass - Adopted Roll Call 141

lower

Feb 12, 2025

Lower · Passed

Reported Out of Committee House of Origin

lower

Feb 11, 2025

Lower · Passed

Pending Committee Action in House of Origin (Economic Development and Tourism)

lower

1 primary · 0 co-sponsors