HB 399 Alabama House · 2026 Regular Session

Tax abatements for data processing centers, exemption period limited, collection of certain taxes on purchases required, sunset date extended

HB 399 modifies tax incentives for large data processing centers in Alabama. It limits the maximum tax exemption period to 20 years starting January 1, 2027, and requires these centers to pay state noneducational ad valorem taxes and sales taxes on building materials, power infrastructure, and other specific purchases beginning in 2027. The bill extends the sunset date for existing tax abatements related to data centers and updates code language for clarity. This directly affects new or expanded data centers meeting job and wage thresholds (20+ jobs averaging $40,000+ annual compensation). The changes aim to balance economic development incentives with increased tax revenue collection for infrastructure investments.

Issues: ✓ Budget & Taxes

Bill status signed all 5 stages cleared

Introduction

Feb 2026

Committee Review

Mar 2026

House Passage

Mar 2026

Senate Passage

Apr 2026

Signed into Law

Apr 2026

Introduced Feb 5, 2026 Signed Apr 17, 2026

Maddy AI version diff · 2 comparisons

What changed between versions

Engrossed → Enrolled · 3 edits · Apr 17, 2026

MINOR

The bill was finalized as an enrolled version with minor formatting updates to the header and page numbering. Substantively, the definition of a 'Data Processing Center' was expanded to include a broader range of modern data services, and the definition of 'Inducement' was clarified to explicitly include official letters and resolutions. These changes ensure the law covers a wider variety of data center operations and clarifies the public commitments required for tax abatements.

Scope change

The scope of the bill was broadened by updating the definition of eligible businesses to include more types of data processing and hosting services.

DEFINITION

The definition of 'Data Processing Center' was expanded to explicitly include specialized hosting, application service provisioning, and general time-share mainframe facilities, ensuring these modern data operations qualify for tax benefits.

The definition of 'Inducement' was updated to clarify that official letters, resolutions, and other official actions expressing intent to issue bonds count as valid inducements for tax abatements.

TECHNICAL

Minor formatting changes were made to the document header, changing 'Engrossed' to 'Enrolled' and updating internal tracking numbers.

Floor votes

How they voted

This bill passed the Senate by voice vote (no roll call recorded).

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Apr 9, 2026

Lower · Passed

Hulsey Motion to Concur In and Adopt Senate Amendment - Adopted Roll Call 1357

lower

Apr 9, 2026

Upper · Passed

Motion to Read a Third Time and Pass as Amended - Adopted Roll Call 1315

upper

Apr 9, 2026

Upper · Passed

Jones motion to Adopt - Adopted Roll Call 1314

upper

Apr 9, 2026

Introduced

Jones 1st Amendment Offered

upper

Apr 9, 2026

Upper · Passed

Jones motion to Table - Adopted Voice Vote

upper

Apr 9, 2026

Introduced

Fiscal Responsibility and Economic Development 1st Amendment Offered (Fiscal Responsibility and Economic Development)

upper

Mar 17, 2026

Upper · Passed

Reported Out of Committee Second House

upper

Mar 17, 2026

Introduced

Fiscal Responsibility and Economic Development 1st Amendment (Fiscal Responsibility and Economic Development)

upper

Mar 11, 2026

Upper · Passed

Pending Committee Action in Second House (Fiscal Responsibility and Economic Development)

upper

Mar 10, 2026

Lower · Passed

Motion to Read a Third Time and Pass as Amended - Adopted Roll Call 832

lower

Mar 10, 2026

Lower · Passed

Motion to Adopt - Adopted Roll Call 831

lower

Mar 10, 2026

Introduced

Hulsey 1st Amendment Offered

lower

Mar 10, 2026

Lower · Passed

Motion to Adopt - Adopted Roll Call 830

lower

Mar 10, 2026

Introduced

Transportation, Utilities and Infrastructure Engrossed Substitute Offered (Transportation, Utilities and Infrastructure)

lower

Feb 10, 2026

Lower · Passed

Reported Out of Committee House of Origin (Transportation, Utilities and Infrastructure)

lower

Feb 5, 2026

Lower · Passed

Pending Committee Action in House of Origin (Transportation, Utilities and Infrastructure)

lower

1 primary · 0 co-sponsors