SB207 By Senator Whatley RFD County and Municipal Government Rd 1 11-FEB-16

SYNOPSIS: Under existing law, neither a municipality nor a municipal public industrial authority may abate county taxes unless the municipality or authority also abates the corresponding municipal taxes.

This bill would clarify that the prohibition was not intended to apply if the municipality does not levy or impose one or more of the taxes to be abated or if the property is outside of the taxing jurisdiction of the municipality.

A BILL TO BE ENTITLED AN ACT

To amend Section 40-9B-5 of the Code of Alabama 1975, as amended by Act 2015-24, 2015 Regular Session, relating to the granting of abatement; to clarify that the prohibitions contained in the section do not apply if the municipality in question does not levy or impose one or more of the taxes to be abated or the property is outside of the taxing jurisdiction; and to provide for a retroactive effective date.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Section 40-9B-5 of the Code of Alabama 1975, as amended by Act 2015-24, 2015 Regular Session, is amended to read as follows:

§40-9B-5.

"(a) Subject to the geographical or jurisdictional or other limitations specified in subsections (b), (c), and (d), the governing body of a municipality, a county, or a public industrial authority may grant abatements of all of the taxes allowed to be abated under Section 40-9B-4 with respect to private use industrial property.

"(b)(1) The abatements authorized to be granted pursuant to subsection (a) for construction related transaction taxes and for ad valorem taxes for a period not to exceed 10 years may be granted:

"a. By the governing body of a municipality, with respect to private use industrial property located within the limits of the municipality or within the police jurisdiction of the municipality; provided, however, that the governing body shall not grant an abatement of any county taxes unless the body has also abated the corresponding municipal taxes; provided further, however, that the foregoing prohibition shall not apply in either of the following cases:

"1. The municipality does not levy or impose one or more of the taxes to be abated.

"2. The municipality is precluded from collecting one or more of the taxes because the private use industrial property is located outside of the taxing jurisdiction of the municipality.

"b. By the governing body of a county, with respect to private use industrial property located in the county and not within a municipality or the police jurisdiction of a municipality, unless consented to by resolution of the governing body of the municipality.

"c. By the governing body of a public industrial authority, with respect to private use industrial property located within the jurisdiction of the public industrial authority; provided, however, that any municipal public industrial authority shall not grant an abatement of any county taxes unless the authority has also abated the corresponding municipal taxes; provided further, however, that the foregoing prohibition shall not apply in either of the following cases:

"1. The municipality does not levy or impose one or more of the taxes to be abated.

"2. The municipality is precluded from collecting one or more of the taxes because the private use industrial property is located outside of the taxing jurisdiction of the municipality.

"(2) The abatements authorized to be granted pursuant to subsection (a) for ad valorem taxes for a period longer than 10 years may be granted:

"a. By the governing body of a municipality, with respect to private use industrial property located within the limits of the municipality or within the police jurisdiction of the municipality, but only as to municipal noneducational taxes.

"b. By the governing body of a county, with respect to private use industrial property located in the county, but only as to county noneducational taxes.

"c. By the Governor, with respect to private use industrial property located in the state, but only as to state taxes.

"The governing body of a county and a municipality may separately authorize one or more public industrial authorities to provide by resolution for such consent on its behalf.

"(3) Notwithstanding the provisions of this subsection, abatements authorized to be granted pursuant to subsection (a) for data processing centers may be granted in accordance with subdivision (1) without regard to the time limitation stated in subdivision (1).

"(c) If a tax is abated pursuant to this chapter, any payment, contribution, or other financial or in-kind award received from a private user or related party shall be divided between the parties whose taxes were abated based upon the tax proceeds which would have been paid if the taxes had not been abated, unless the party receiving such award can prove that the award was not related to the granting of any abatement.

"(d) Any abatement of county taxes granted by a municipality or municipal industrial authority shall not be valid until the expiration of (1) 10 days following the date of physical delivery to the county commission or (2) 13 days following the date of mailing by certified mail to the county commission of a copy of the resolution granting such abatement. Proof of delivery by affidavit of service, in the case of physical delivery, or by certified mail receipt, in the case of mailing by certified mail, shall be furnished to the Department of Revenue at the same time as the filing of the abatement agreement under Section 40-9B-6. If the procedures herein prescribed are followed, any such abatement shall be effective as of the date granted."

Section 2. This act shall become effective retroactive to April 4, 2002, following its passage and approval by the Governor, or its otherwise becoming law.

Taxation

Abatement

Municipalities

Industrial Development

Code Amended