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BBA Legislative Impact Report

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BBA Legislative Impact Report 2019 LEGISLATIVE IMPACT REPORT TABLE OF CONTENTS BBA Investors, 4 14 The 2019 legislative session was extremely successful for the Birmingham business BBA LEGISLATIVE PRIORITIES TAXES & LICENSES Exemption for Economic Development Professionals Determination of State and Local Lease Taxes community. While not without its challenges, the session saw ample passage of pro- Alabama Incentives Modernization Act Business Delivery Licenses economic development legislation, and, by session’s end, several favorable laws were Consumer Lending Practices Financial Institution Excise Tax Reform Act enacted. With passage of the Alabama Incentives Modernization Act, there will be Alabama Innovation Act Technical Changes to the Simplified Sellers Rebuild Alabama Act Use Tax Program aid in the recruitment of tech companies to the state – an issue important to urban Alabama Department of Economic and Community Electronic Business Filings areas throughout Alabama – and incentives will be enhanced to increase job growth Affairs Broadband Grant Program in Alabama’s rural counties. Additionally, the Alabama Innovation Act will create a Age Requirements for CDL Licenses Alabama Industry Recognized and Registered research and development enhancement grant program for eligible entities engaging Apprenticeship Program Act 16 CONSTITUTIONAL AMENDMENTS in qualified research within the state. Lastly, passage of the Rebuild Alabama Act Eliminating Legal Barriers to Apprenticeships Act Review and Recompilation of Alabama Constitution will provide much needed funding to address infrastructure needs across the state. Right to Vote Limited to U.S. Citizens These are just a few standout pieces of legislation that reflect the overall success of State Board of Education Reform the 2019 legislative session, which is reviewed in detail here through the lens of the 8 LEGISLATIVE SESSION SCORECARD Birmingham Business Alliance’s 2019 state legislative agenda. 17 NEW LOCAL LAWS As we look ahead to the upcoming 2020 legislative session, it is important to reflect 10 Class 1 Municipalities – Industrial Development Boards on the new laws that will shape public policy going forward, as well as provide an STATE BUDGETS Jefferson County – Hoover Ad Valorem Tax General Fund Budget Jefferson County – Mountain Brook Ad Valorem Tax outlook of what to expect when the legislature convenes next February. We expect to Education Trust Fund Budget Jefferson County – Hoover Alcohol Sales see collaborative efforts by business leaders across the state to extend the Alabama Jefferson County – Mountain Brook Alcohol Sales Jobs Act, the Growing Alabama Act and begin conversation around extension of the Bibb County – Sales and Use Tax Blount County – Lodging Tax Alabama Historic Rehabilitation Tax Credit. We are also optimistic that we will take 11 further steps to put in place policies that give us a competitive advantage to recruit NON-PRIORITY BILLS OF INTEREST Brewpub Legislation and grow high-growth startups. This report includes a table of contents to help you Recapture of Call Center Benefits 18 navigate and more easily identify the laws of interest to you and your business. We Railroad Modernization Act of 2019 BILLS OF INTEREST THAT DID NOT PASS welcome your feedback about the contents of this report and encourage you to Operation of Autonomous Vehicles Simplified Sellers Use Tax Broadband Using Electric Easement Act Protect Small Business Act engage with us as we advocate for policies that impact economic growth, workforce Abortion as a Felony Offense with Limited Exceptions Repeal of Common Core development, infrastructure, and research and development in the Birmingham region. Medical Cannabis Study Commission Alabama Lottery Proposal Phase in of Computer Science Courses Alabama Inland Ports Alabama Literacy Act Alabama School Choice and Opportunity Act The BBA staff would like to thank the members of the Executive Committee, the Public Facilities for Career Technical Programs Policy Committee, the Governmental Affairs Committee and all BBA investors who Donation of Surplus Food participated in making this year’s state legislative advocacy efforts a great success! Extension of Private Hospitals Assessment Regulation of Shared Micromobility Device Systems 19 LEGISLATORS AND THEIR DISTRICTS Best regards, 13 Greg Curran BUSINESS FILINGS & OPERATIONS Chairman of the Firm Revisions to Alabama Business Corporation Law Unemployment Benefits Maynard Cooper & Gale Revisions to Alabama Limited Liability Company Law BBA Vice Chairman for Public Policy Alabama Small Business Commission Employment Discrimination Prohibition 3 THE AIM ACT BBA LEGISLATIVE PRIORITIES CHANGING HOW ALABAMA GROWS Prior to the AIM Act After the AIM Act ECONOMIC GROWTH • New Market Tax Credits New offerings for Exemption for Economic Development Professionals Alabama created a state version of Opportunity Zones (OZs) Act 2019-52 by Rep. Baker | Effective Date: April 19, 2019 the federal NMTC program in 2012. There are few, if any, tax credits • Federal Conformity This law provides that individuals acting as economic development professionals are not available today. Alabama has made the state income considered lobbyists unless and until they seek incentives through legislative action that are Real tax treatment for Opportunity Zone above and beyond those available under existing statutory or constitutional provisions. This Estate • Historic Tax Credits (OZ) investments the same as exemption does not apply to any person that is otherwise required to register as a lobbyist. Alabama created a state version of the federal income tax treatment. Investing the federal HTC program in 2012. Investments in Alabama OZs receive Impact on Business: This change in the law ensures the activities of economic development parallel tax treatment to investments • Downtown Redevelopment professionals are distinguished from those of registered lobbyists, which ultimately protects in federal OZs. For real estate developments in the confidentiality of site selection efforts of companies seeking to locate in Alabama. certain Alabama downtown areas, • Funding Opportunities it is possible to convey a project Alabama has allowed almost $4.5 Consumer Lending Practices to a Downtown Redevelopment billion of state funds to invest at least HB 258 by Rep. Garrett (SB 75 by Sen. Orr) | Last Action: Pending Committee Action in House of Origin Authority during construction, so 3% of their corpus in OZ funds. that no sales taxes are owed on These bipartisan bills would give payday loan borrowers a minimum of 30 days to repay the construction materials. Recent • Guaranteed Returns debt. The current payment schedule for such loans (which are $500 or less) typically requires statutory amendments make it Alabama has created $50 million repayment within 10 to 14 days. difficult for a city to expand its use worth of state income tax credits of this program. to guarantee minimum returns on This legislation did not pass, and the BBA will continue to support work to reform Alabama’s investments in OZs. laws regulating lending practices during the 2020 legislative session. Alabama Incentives Modernization Act (AIM Act) • Refundable Credit • Enhanced Credit for Tech Act 2019-392 by Rep. Poole | Effective Date: August 5, 2019 for Job Creation Companies The Alabama Incentives Modernization Act is a comprehensive legislative overhaul designed Alabama provided cash equal to Alabama provides cash equal to 5% to improve industry recruitment in rural counties, recruit high-tech companies to the state 3% of last year’s payroll to be paid of last year’s payroll to be paid for 10 and expand Alabama’s Opportunity Zone program. Among other incentives, it enhances Tech for 10 years to companies that years to tech companies that create the Growing Alabama tax credit to provide an additional mechanism for local economic Company create at least 50 jobs in Alabama. only five jobs in Alabama. development organizations to seek funding for improvements to inland ports, worker and • Capital Gains Tax Cut student retention programs, and improvement of research and industrial parks. Incentives for Tech Companies Alabama created a 100% capital Impact on Business: This act further increases Alabama’s appeal to industry prospects by gains tax cut for investments in offering numerous expanded tax credits and incentives to insurance companies, technology tech companies that move their companies, companies located in (or seeking to locate to) rural areas of the state and headquarters to Alabama at least three companies located in Opportunity Zones. years before a sale, so long as the investors and the company stay for five years after the change of ownership. • Tax Credits for • Tax Credits for Expanded Improvements to Activities Industrial Properties Growing Alabama credits can now be Economic and The Growing Alabama awarded for funding of tech company program allowed $10 million of accelerators, research parks, industrial Community improvements to be made to parks, inland ports and intermodal industrial property throughout the facilities. Development state, funded through an Alabama income tax credit. The AIM Act also enhanced the tax incentives for economic development projects in rural parts of the state (and expanded the number of areas in the state classified as rural). 4 5 RESEARCH AND INNOVATION WORKFORCE DEVELOPMENT Alabama Innovation Act Age Requirements for CDL Licenses Act 2019-404 by Sen. Orr | Effective Date: June 6, 2019 Act 2019-249 by Rep. Grimsley | Effective Date:
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