Governor Kay Ivey recently signed into law legislation that will encourage economic and industrial development within the region and will result in the creation of jobs.
HB 396, sponsored by Representative Rod Scott of the Jefferson County delegation, allows the Birmingham Industrial Development Board (IDB) to charge a small administrative fee to companies applying for tax abatements – on a rolling scale and determined by capital investment of the project.
The money obtained by these fees will be used to support economic development activities within the City of Birmingham, such as allowing the IDB to do more extensive data-driven research on site development and availability and to provide support to assist with infrastructure projects associated with site development for industrial projects.
Last year, the Birmingham IDB approved abatements for several companies including Brasfield & Gorrie, DC BLOX, Dread River Distilling Co., P&S Transportation and Favor Steel, among others.
“Situations arise sometimes when companies need additional assistance,” said Nan Baldwin, vice president of regional development for the Birmingham Business Alliance and the IDB’s secretary. “In situations that used to be a deal breaker for companies, funds will now be available through fees the IDB collects to assist them.”
Birmingham’s IDB consists of a seven-member board of directors appointed at large for six-year terms by the Birmingham City Council. The IDB grants industrial development tax abatements, assists in the location or expansion of industry within the city and issues industrial revenue bonds.
“This bill puts the IDB in a position to better support projects and offer up another avenue for economic developers to bring projects in,” Baldwin said.
Several industrial development entities across the state, including ones in Mobile and Tuscaloosa, already charge a fee for tax abatement applications that helps advance economic development efforts.
The Birmingham IDB is an independent entity, but the BBA does pro bono work for the board and manages its operational, day-to-day functions because of its impact on the region.