The Alabama Incentives Modernization Act (AIMA) – which went through the Legislature as HB 540 and was signed into law as Act 2019-392 – is a set of tax incentives that will attract new tech companies to Alabama and spur job growth in both urban and rural areas of the state that are experiencing slow economic conditions.
AIMA will aid in the recruitment of tech companies to Birmingham and all of Alabama, building on the success of companies like Shipt and recent recruitment of companies by the new initiative Birmingham Bound and the Alabama Futures Fund.
One of the key components of AIMA is that it decreases the number of employees needed to qualify for Alabama Jobs Act incentives from 50 to five and offers a capital gains tax cut for high-tech companies moving to the state.
“The Alabama Incentives Modernization Act was a key piece of priority legislation for the Birmingham Business Alliance,” which strongly supported the bill, said Senior Vice President of Public Policy Waymond Jackson. “It truly has the potential to be transformative legislation for many communities across our region, both urban and rural. Its passage signals our legislators’ commitment to advancing our state, keeping Alabama cutting edge and moving our economy in the right direction.”
The act is also beneficial for businesses in rural communities, which face challenges like decreasing population and have lower household income, higher poverty and worse unemployment compared to urban areas of the state. 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. The act also provides incentives to attract investors to Alabama’s 158 Opportunity Zones, 24 of which are in Birmingham.
Additionally, the Growing Alabama Credit, which is part of the legislation, would help in both urban and rural growth, able to fund tech accelerators, research parks and marketing programs for STEM workers as well as industrial parks, inland ports – such as Birmingport – and The Alabama Farm Center in Chilton County.