Goat Hill Report-Week Ending March 6, 2026
This week the Alabama legislature completed Week 8 of the session. After a 2-day work week, the legislature has now completed 19 days out of a possible 30 legislative days. The next two weeks are expected to be 3-day weeks followed by spring break the week of March 23. In addition, it is anticipated – though not confirmed – that the session will conclude by April 9.
Details of this week’s notable action and news items are provided below.
Budgets Moving Next Week
Both the General Fund (GF) and Education Trust Fund (ETF) budget packages are expected to be in committee next week. As is customary, the chambers rotate who has the “first pass” at state budgeting priorities – with the GF starting on the Senate side this year and the ETF originating in the House. These are the only bills that the Legislature is constitutionally mandated to pass in any given legislative session. It is expected that a great deal of deference will be given to Governor Kay Ivey’s budget recommendations (presented in January) given that it is her last year in office, but as is customary, the budget chairman will be working to sift through a variety of programmatic requests from individual legislators or interest groups over the next 3-4 weeks to finalize what may be included in the version that is returned to Ivey in April. On the ETF funding side, some key areas to watch for are funding totals for the Public Education Employees Health Insurance Plan (PEEHIP) and the CHOOSE Act program, which provides school choice funding and is administered by the Department of Revenue. The GF budget continues to grow year-over-year, but legislative leaders have urged caution that in the years ahead there may not be as much wiggle room to address anticipated needs at certain state agencies – to include the Department of Corrections and the Alabama Medicaid Agency, amongst others.
Progress In Online Sales Tax Debate
On Thursday, Senate General Fund Chairman Greg Albritton (R-Range) introduced SB347 related to Alabama’s simplified sellers/online sales tax. Better known as the “SSUT,” this tax – and particularly the state’s growing revenues from it – has become a dominant political topic in Montgomery in recent years. There have been several legislative attempts to modify the distributions of SSUT proceeds between the cities and counties, and none have been successful thus far. The debate was further intensified when a lawsuit was filed last year by several municipalities and local school boards. That lawsuit was recently dismissed by the plaintiffs (without prejudice) in order to re-open negotiations on legislative remedies to address SSUT-related concerns. Albritton’s proposed bill is narrow in its scope in that it simply changes the population-factor (for distribution of the tax) to an every 5-year period than the current 10-year period. Stakeholders appear to agree that while this is just one element of the overall SSUT landscape, its passage could help break the ongoing political stalemate amongst local governments.
Tax on Overtime Pay Revisited
HB527 by Rep. James Lomax (R-Huntsville) would establish an individual income tax deduction of up to $1,000 on Alabamians’ overtime pay. The new deduction would be valid for money earned between Jan. 1, 2025 and Dec. 31, 2027. This legislation revisits a previous effort to provide an overtime pay tax cut in Alabama. In 2023, House Minority Leader Anthony Daniels (D-Huntsville) successfully brought an overtime tax exemption bill. However, initial estimates said that cut would cost the state about $34 million in lost revenue annually, but the final cost for the cut’s 18-month existence ballooned to over $400 million. The 2023 bill was a sunset law set to expire in June 2025, and despite bipartisan support the legislature never made it permanent. Lomax’s HB527 is pending consideration on the House Ways & Means Education Committee.
Bills of Interest to the Concrete Industry
House Bill 566 by new House Majority Leader, Rep. Paul Lee (R-Dothan), will be considered in the House Transportation, Infrastructure, and Utilities Committee next Wednesday. The legislation would end the practice of businesses being forced to buy gross revenue business licenses in multiple cities based on the same gross revenue.
In some municipalities, ready mix producers pay a gross revenue business license in the city where they delivered the concrete even though they do not have a plant in the city. In addition, they are required to pay a gross revenue license in the city where the concrete plant is located. However, some host municipalities do not allow you to reduce gross revenue receipts even when they are being used to calculate the business license in the project city. In these cases, the ready-mix producer is effectively being double taxed on the same gross revenue. The bill would help end this unfair practice.
The legislature will reconvene on Tuesday, March 10, 2026. Please call our office should you have any questions about the report. To view a list of bills the association is tracking, click here.