Budget & Taxes (Property Tax)

HB 167 would change Alabama's property tax rules by replacing a fixed 7% annual cap on assessed value increases with a cap tied to the annual inflation rate (measured by the Consumer Price Index). This directly affects property owners, particularly those with Class II and III properties, as their annual tax assessments would now rise or fall based on inflation rather than a fixed percentage. The bill applies retroactively from October 1, 2024, and continues through 2027, with exceptions for new construction, property transfers between family members, and certain ownership changes. The change aims to align property tax increases more closely with actual cost-of-living changes.

HB 85 requires Alabama counties to reappraise Class II (commercial/industrial) and Class III (agricultural) property every three years instead of the current ad hoc system. This directly affects property owners in these categories by changing how their tax assessments are calculated. If a reappraisal shows higher property value, the increased tax amount is phased in equally over the next three years rather than applying fully immediately. The bill amends Alabama law to implement this schedule and phase-in process, effective May 1, 2026.

HB 77 helps disabled veterans with a 100% VA disability rating by streamlining their access to property tax exemptions when applying for home mortgages. The bill requires tax officials to issue a "tentative certificate" of disability exemption upon receiving basic documentation (like VA disability proof and purchase agreements) within 20 days. It also prohibits lenders from including homestead property taxes in a veteran’s debt-to-income ratio calculation when processing their mortgage application. This directly affects veterans seeking home loans who qualify for Alabama’s homestead tax exemption. The law takes effect October 1, 2026.

HB 65 proposes a constitutional amendment to allow Franklin County residents aged 65 or older to claim a property tax exemption on their primary residence. To qualify, seniors must own the home as their principal residence for at least five years and meet income requirements (not detailed in the bill text). The exemption freezes the property’s assessed value from the year before claiming it, but does not affect homestead exemptions or millage rate changes. The amendment requires voter approval and would take effect for tax years beginning October 1, 2027, with claims due by December 31, 2027. This is a proposed change to the state constitution, not yet law.

HB 64 proposes a constitutional amendment for Colbert County to allow residents aged 65+ to claim a property tax exemption on their primary residence. To qualify, a homeowner must own a single-family home as their principal residence for at least five years before claiming the exemption, and the exemption freezes the property's assessed value from the prior year. The exemption requires written application to the county revenue commissioner between October 1 and December 31, 2027, for the 2027 tax year, and remains valid as long as the homeowner continues living there. This would directly affect Colbert County seniors meeting these specific residency and ownership criteria.