This amendment allows large manufacturing zones to be placed inside tax increment districts of any size and lets those districts use collected taxes to pay for land bought before the district was created.
Alabama2026Enacted
HB626
Changes to Tax Increment Districts and Manufacturing Zones
Last scannedAug 24, 2026, 9:06 AM
In one sentence
This law allows Major 21st Century Manufacturing Zones for shipbuilding and other industries inside tax increment districts without size limits, and lets public groups use district taxes to pay back costs for land bought before the zone started.
What it does
- Adds sites suitable for shipbuilding-industry related facilities to the list of places that can be Major 21st Century Manufacturing Zones.
- Removes the rule limiting how big a tax increment district must be to hold a Major 21st Century Manufacturing Zone.
- Allows ad valorem taxes collected in a tax increment district to reimburse public entities for land bought inside a manufacturing zone before the district was created.
Who it affects
- Local governments that create or manage tax increment districts
- Public entities involved in acquiring land for development projects
Limits and unknowns
- The law does not specify how much money will be available for reimbursement.
- Local governing bodies must still determine if an area meets all criteria to become a Major 21st Century Manufacturing Zone.
Plain language
Terms to know
- Tax increment district
- A specific area where local governments collect property taxes to fund development projects.
- Major 21st Century Manufacturing Zone
- An area of at least 250 contiguous acres designated for large manufacturing facilities expected to cost over $100 million, including shipbuilding and other industries listed in the law.
- Ad valorem tax revenues
- Money collected from property taxes based on the value of land and buildings within a district.
Official record
Sources
Official summary
This act amends Sections 11-99-2, 11-99-4, 11-99-5, and 11-99-6, Code of Alabama 1975, to: (1) add sites suitable for shipbuilding-industry related facilities, subject to other conditions, to those sites that local governments may determine are Major 21st Century Manufacturing Zones; (2) add costs incurred by a public entity in acquiring land within a Major 21st Century Manufacturing Zone before the creation of the tax increment district in which the zone is located to those costs for which a public entity may be reimbursed using ad valorem tax revenues collected within the tax increment district; and (3) remove the size limitation of Major 21st Century Manufacturing Zones within tax increment districts.
Official activity
Bill history
- EnactedHouse
- Motion to Read a Third Time and Pass - Adopted Roll Call 1176 (Yeas 30, Nays 0)Senate
- Third Reading in Second House (Yeas 30, Nays 0)Senate
- Signature RequestedSenate
- Delivered to GovernorHouse
- EnrolledHouse
- Ready to EnrollHouse
- Read for the Second Time and placed on the CalendarSenate
- Reported Out of Committee Second HouseSenate
- Motion to Read a Third Time and Pass as Amended - Adopted Roll Call 1080 (Yeas 98, Nays 0)House
- Motion to Adopt - Adopted Roll Call 1079 (Yeas 99, Nays 0)House
- Motion to Adopt - Adopted Roll Call 1078 (Yeas 101, Nays 0)House
- Third Reading in House of Origin (Yeas 78, Nays 0)House
- Pending Committee Action in Second HouseSenate
- Read for the first time and referred to the Senate Committee on TourismSenate
- EngrossedHouse
- Pringle 1st Amendment OfferedHouse
- Economic Development and Tourism Engrossed Substitute OfferedHouse
- Read for the Second Time and placed on the CalendarHouse
- Reported Out of Committee House of OriginHouse
Changes
Amendments
2 stored
This amendment updates the list of industries eligible for special tax zones to include aviation and shipbuilding-related businesses.