The Alabama Legislature concluded its sixth week and 12th legislative day Thursday. A total of 605 bills have been introduced so far this session (376 House bills and 229 Senate bills). Each chamber continues to work an aggressive schedule, going into formal session three days each week, with plans to finish in early April.
Tax Relief
Two tax relief bills are headed to Gov. Kay Ivey for her signature after they passed the Senate Thursday afternoon.
SB 152 by Sen. Dan Roberts, R-Mountain Brook, changes the state tax code to ensure federal COVID-19 relief, such as the expanded child tax credit, is not considered taxable income.
HB 82, titled the “Small Business Relief and Revitalization Act” by Rep. Danny Garrett, R-Trussville, will provide a tax exemption for businesses up to $40,000 of the market value of business tangible personal property from state ad valorem tax. (Most property used for agricultural production is already exempt from business personal property ad valorem tax.)
School Choice
The “School Choice Bills” will be sent to a study commission for “further development” by legislative leaders. This move by leadership is a likely sign that these bills will have a tough road this session.
Agricultural Tax Clarification
Alabama Farmers Federation is continuing work toward legislation to clarify two specific areas of the agricultural tax code.
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Grain Storage Facilities and Irrigation Infrastructure — Current law exempts farm implements used for harvesting and selling of crops from ad valorem tax. The Department of Revenue has narrowly defined a farm implement as a “device drawn by a tractor” thereby excluding grain bins and irrigation infrastructure from the tax exclusion. The Federation is pursuing changing the tax law to include these important tools of agricultural production from ad valorem taxation by the state.
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Producer Value-Added Farm Products — Under current law, a farmer is exempt from charging sales tax when selling his products in raw form. However, once the farmer further processes the product, or “adds value,” the farmer must remit sales tax. For example, a farmer who sells peaches in raw form does not have to charge sales tax to customers. However, if the farmer turns those peaches into peach jam, the farmer has “added value” and must remit sales tax. The current taxation scheme has created problems for farmers. In the eyes of the state, when the farmer remits sales taxes on value-added products, the farmer is no longer a farm operation but a commercial business, further complicating tax liabilities. This legislation would exempt a farmer from remitting sales tax on value-added agricultural products they grow and process.
Forest Products Economic Development Specialist
The Federation supports a new line item in the Alabama Forestry Commission’s budget to establish and maintain a new forest products economic development specialist. This position would be solely focused on recruitment efforts for the forest products industry (pulp and paper, sawmills, secondary products, and exports). This request is a recommendation of the Federation's Forest Products Study Committee appointed to review ways to expand opportunities for timber owners in the state.
Forever Wild Carbon Tax Credits
The Federation is closely monitoring HB 65 by Rep. Ben Robbins, R-Sylacauga, which was scheduled for a public hearing in the House Ways and Mean Committee this week. The bill would propose an amendment to the Constitution to provide any income from carbon credits generated from the management of Forever Wild forest resources would be credited to the county general fund in which the Forever Wild land is located.
Log Truck Weight Tolerance
Introduced this week, HB 368 by Rep. Bob Fincher, R-Woodland, would allow for a 10% variance in the required maximum gross weight per axel for log trucks. Under existing law, log trucks are subject to per axel weight requirements with only a 10% variance on the total gross weight of the truck.
Peanut State Legume
Also introduced this week, HB 350 by Rep. Wes Allen, R-Troy, would designate the peanut as the official state legume of Alabama. The bill is supported by the Alabama Peanut Producers Association as a way to promote the nutritious and versatile crop.
Auburn University Board Of Trustees
The Senate this week confirmed Gov. Kay Ivey's appointments of Zeke Smith and Caroline Aderholt to the Auburn University Board of Trustees. Smith will represent Alabama at-large, and Aderholt will represent the seventh district. They will serve seven-year terms.
Catalytic Converters
The House of Representatives this week passed a bill aimed at cracking down on theft of catalytic converters. HB 117 by Rep. Paul Lee, R-Dothan, would provide requirements for the purchase, possession and sale of certain catalytic converters and create criminal penalties for violations.
