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HB542 INTRODUCED
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HB542
DGC2BNN-1
By Representative Blackshear
RFD: Transportation, Utilities and Infrastructure
First Read: 03-Mar-26
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DGC2BNN-1 03/03/2026 ZAK (L)ZAK 2026-488
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First Read: 03-Mar-26
SYNOPSIS:
Under existing law, certain utilities, including
those with a gross annual income of two hundred fifty
million dollars or less, may be reimbursed for costs
incurred to relocate utility facilities required for
road construction pursuant to an order of the Director
of Transportation, subject to certain conditions.
This bill would add conditions to the payment of
costs by the state for utility facility relocations by
these certain utilities.
This bill would require the director to
reimburse utilities with a gross annual income over two
hundred fifty million dollars for costs incurred in
relocating utility facilities pursuant to an order of
the director, subject to certain conditions.
This bill would also require the director to
submit an annual report to the Legislature that
provides information related to such payments.
A BILL
TO BE ENTITLED
AN ACT
Relating to public highways; to amend Section 23-1-5,
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Relating to public highways; to amend Section 23-1-5,
Code of Alabama 1975, to add conditions to the state payment
of utility facility relocations by certain utilities; to
require the Director of Transportation to reimburse utilities
with a gross income over two hundred fifty million dollars for
costs incurred in relocating utility facilities required for
highway construction pursuant to an order of the director; and
to require the director to submit an annual report to the
Legislature.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. Section 23-1-5, Code of Alabama 1975, is
amended to read as follows:
"§23-1-5
(a) For the purposes of this section, the following
terms have the following meanings:
(1) COST OF RELOCATION. Includes the entire amount paid
by a utility properly attributable to the relocation after
deducting therefrom any increase in the value of the new
facility and any salvage value derived from the old facility.
(2) DISTRIBUTION LINE. Any utility facility that
distributes or transmits electricity at a voltage less than
40,000 volts.
(3) NATIONAL SYSTEM OF INTERSTATE AND DEFENSE HIGHWAYS.
The national system of interstate and defense highways or
interstate system described in 23 U.S.C. § 103.
(4) TRANSMISSION LINE. Any utility facility that
distributes or transmits electricity at a voltage of 40,000
volts or more.
(5) UTILITY. Includes publicly, privately, and
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(5) UTILITY. Includes publicly, privately, and
cooperatively owned utilities and any provider of broadband
service, cable service, or telecommunications service.
(b) Whenever the Director of Transportation shall
determine determines and order orders that the relocation of
any utility facility is necessitated by the construction of
any project on the national system of interstate and defense
highways, including the extensions thereof within urban areas,
the utility owning or operating the utility facility shall
relocate the facility in accordance with the order of the
Director of Transportation. Notwithstanding the foregoing, if
the cost of the utility facility relocation is eligible and
approved for reimbursement by the federal government, the cost
of the relocation of the utility facility shall be paid by the
state as a part of the cost of the construction of the project
out of the funds then or thereafter available for the highway
construction after the utility has furnished the Director of
Transportation with all papers, records, or other supporting
documents required by the director. After the final federal
Bureau of Public Roads' audit, the utility shall repay to the
state the difference, if any, between the total amount paid by
the state to the utility for the relocation and the total
amount collected by the state from federal participation on
the utility relocation, plus the state's matching share of the
federal participation.
(b)(c)(1) Whenever the Director of Transportation shall
determine determines and order orders that the relocation of
any utility facility is necessitated by the construction of
any highway, road, or street, other than the highways that are
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any highway, road, or street, other than the highways that are
a part of the national system of interstate and defense
highways referred to in subsection (a) of this section (b),
the utility owning or operating the facility shall relocate
the facility in accordance with the order of the Director of
Transportation at its own expense. Notwithstanding the
foregoing, if the facilities to be relocated are owned by any
utility which that had a gross income of two hundred fifty
million dollars ($250,000,000) or less for the calendar year
immediately preceding the relocation, or in the case of
utilities which may be hereafter organized and created, which
have a gross income of two hundred fifty million dollars
($250,000,000) or less in their first complete year of
operation or in the calendar year immediately preceding the
relocation or, in the case of utilities owned or operated by a
corporation organized pursuant to Article 8, Chapter 50, Title
11, the cost of the relocation of the utility facility shall
be paid by the state as a part of the cost of the construction
of the project out of the funds then or thereafter available
for the highway construction after the utility has furnished
the Director of Transportation with all papers, records, or
other supporting documents required by the director. After the
final federal Bureau of Public Roads' audit, the utility shall
repay to the state the difference, if any, between the total
amount paid by the state to the utility for the relocation and
the total amount collected by the state from federal
participation on the utility relocation, plus the state's
matching share of the federal participation.
(2) Beginning on October 1, 2027, the total amount of
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(2) Beginning on October 1, 2027, the total amount of
costs paid to relocate utility facilities by the state
pursuant to subdivision (1) during a state fiscal year shall
be not less than twenty million dollars ($20,000,000).
(d) Beginning on October 1, 2027, notwithstanding
subsection (b) or (c), the Director of Transportation shall
reimburse a utility that had a gross income over two hundred
fifty million dollars ($250,000,000) for the calendar year
immediately preceding a utility facility relocation for costs
incurred in relocating the facility in connection with the
construction, reconstruction, or improvement of any public
road, street, or highway pursuant to a determination and order
of the director, subject to all of the following:
(1) The total amount of reimbursement paid to all such
utilities during a state fiscal year may not exceed ten
million dollars ($10,000,000).
(2) Reimbursement for a single utility facility
relocation may not exceed five hundred thousand dollars
($500,000).
(3) Any costs incurred by a utility for a utility
facility relocation in excess of the limit provided in
subdivision (2) are the responsibility of the utility.
(4) All reimbursements issued pursuant to this
subsection are subject to the same documentation, audit,
adjustment, and repayment requirements as provided in
subsections (b) and (c).
(c)(e) The Director of Transportation may enter into
contracts or agreements and conform any existing contracts or
agreements with utilities in order to effectuate the purposes
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agreements with utilities in order to effectuate the purposes
of this section.
(f) The Director of Transportation shall provide an
annual report to the Legislature not later than the first
legislative day of each regular session. The report shall
provide relevant information under this section, including the
total number and costs of utility facility relocations paid by
the department and which were and were not reimbursed by the
department pursuant to this section during the preceding year.
(g) This section shall apply to any project requiring
the relocation of a utility facility which is funded in whole
or in part with federal or state funds.
(h) For purposes of this section, when a utility
facility relocation requires the relocation of transmission
lines and distribution lines, the relocation of transmission
lines and distribution lines shall be considered separate and
distinct utility facility relocations.
(i) Notwithstanding any other provision of law, if a
utility begins a utility facility relocation pursuant to this
section and the Director of Transportation determines and
orders a revision to the utility facility relocation for the
same project before completion of the project, the state shall
pay all further costs of relocating the utility facility after
the revision.
(d) The word utility shall include publicly, privately,
and cooperatively owned utilities. The words cost of
relocation shall include the entire amount paid by the utility
properly attributable to the relocation after deducting
therefrom any increase in the value of the new facility and
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therefrom any increase in the value of the new facility and
any salvage value derived from the old facility. The words
national system of interstate and defense highways mean the
national system of interstate and defense highways or
interstate system described in subsection (d) of Section 103
of Title 23, United States Code. "
Section 2. This act shall become effective on October
1, 2026.
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