Legislation that will aid in the recruitment of tech companies to urban areas in Alabama has been signed into law by Governor Kay Ivey.
HB 540, also known as the Alabama Incentives Modernization Act (AIMA), was strongly supported by the Birmingham Business Alliance (BBA). The legislation was introduced by Representative Bill Poole (R-Tuscaloosa) and is an update of the Alabama Jobs Act and the Growing Alabama Act Income Tax Credit, both of which were set to expire soon.
The bill expands the incentives offered by the current legislation, as well as encourages investments in Opportunity Zones and offers a capital gains tax cut for high-tech companies moving to Alabama. There are also discussions of adding language to support expansion of Alabama’s inland ports.
The recruitment of tech companies is an issue important for urban and rural areas.
The legislation will be a win for the recruitment of small businesses such as startups. Previously, companies must have 50 employees to qualify for Alabama Jobs Act incentives, but, now that AIMA has passed, only five employees will be required for incentives.
Before AIMA, only counties with less than 25,000 residents were considered rural and able to receive incentives specifically designed for rural communities. AIMA raises that number to a population of 50,000 or less, allowing 13 new counties to receive additional incentives, including Chilton County in the Birmingham seven-county region.
“Passage of the Alabama Incentives Modernization Act is a win for the state of Alabama, and Birmingham in particular,” said Greg Curran, vice chairman of public policy for the BBA and Chairman of the Firm at Maynard Cooper & Gale PC. “Birmingham is a hub for high-tech startups, and the BBA wants to continue to recruit those companies to our city. This legislation will certainly help in the effort of recruiting and growing startups in our city, which in turn will create an attractive ecosystem that boosts entrepreneurship, attracts venture capital and better positions us to compete with other cities across the country where tech companies thrive.”