The second week of Alabama’s 2024 legislative session continued at a fast pace! With twenty percent of the session complete in just two weeks, we have seen a lot, from bills on library board member removal and education savings accounts to gambling and ballot harvesting. Bill filing numbers lag behind prior years as the legislature focuses on these issues but will likely pick up in the next few weeks. REALTOR® Day was an absolute blast with hundreds of Alabama REALTORS® descending on the state capital. Read on for weekly highlights.

Proclaimed as REALTOR® Day by Governor Ivey, February 13 saw REALTORS® from across the state come to Montgomery for a day of networking and advocacy. REALTORS® heard from elected officers and industry representatives on legislative priorities, economic development strategies, the workings of the Alabama Supreme Court, and updates from leaders in business, lending and construction. 

The afternoon saw REALTORS® at the State House where they met with legislators, heard debate in the Senate, and were recognized from the Senate floor by Lt. Governor Will Ainsworth. REALTOR® Day concluded with a fantastic reception for members to network with state lawmakers, judges, Governor Ivey and other executive branch leaders. Thank you to all those who attended and hope to see you again next year!

The Senate version of a bill that caps annual increases to the assessed value to property taxes was filed. SB 110, sponsored by Sen. David Sessions (R-Grand Bay) and pushed by Lt. Gov. Will Ainsworth, would limit annual increases of a properties assessed value at 3% for residences and agricultural land, and 5% for commercial property. Included in the bill are REALTOR® requested amendments in two areas: 1) clarify that improvements, which are excluded from the cap, do not include repairs and maintenance, and 2) certain changes of ownership, like transfers between spouses or between family members for no or nominal consideration, do not result in the property losing the cap. 

As a refresher, real property is taxed based on its assessed value, which is determined by multiplying the appraised or fair market value of property by a percentage set by state statute depending on the class of property. For example, residences are class III property and subject to a 10% multiplier. So, a property appraised at $100,000 has an assessed value of $10,000 ($100,000 x 10%). To determine the amount of property taxes, the assessed value is then multiplied by the applicable millage rate, which can include multiple rates (e.g., state, county, school, municipality). So, the $100,000 property with a total millage rate of 36.5 would result in property taxes of $365 ($10,000 assessed value x .0365 millage rate). For a more detailed explanation of property taxes in Alabama, read this article from Alabama REALTORS®. 

In the past several years, that property’s appraised value may now be close to $200,000, especially if the local tax assessing official has not looked closely at appraisal values. That doubling of appraised value would double the property tax amount ($20,000 x .0365=$730), an increase that can be difficult for lower income and fixed income households.

An issue of concern for owners and property managers, the removal of squatters from a dwelling is the topic of HB 182. Sponsored by Rep. Craig Lipscomb (R-Gadsden), the bill allows law enforcement to remove a squatter, or an individual not authorized to be in the dwelling without judicial involvement upon an owner or owner’s agent requests the squatter’s removal by affidavit. Of note, tenants cannot be considered as squatters, so the current laws on tenant eviction continue to apply. Alabama REALTORS® applauds the bill as a straightforward approach to ensuring trespassers can be quickly and safely removed from a house or apartment. 

Reviewed in CNN Week 1, the two-bill gambling package passed a House committee and the full House of Representatives last week. As a reminder, one of the bills is a constitutional amendment that would allow gambling in Alabama, and the second bill, called enabling legislation, lays out all the laws on gambling. The constitutional amendment received 70 yay votes, over the requisite 63 for a constitutional amendment, while the enabling bill passed with 67 yay votes.  

Included in the enabling legislation is REALTOR®-supported language that prohibits political contributions from those involved in the gambling industry. Intended to minimize corruption, the language remains unchanged out of the House, although amendments were made to both bills. 

The package would allow a state lottery, a total of 10 casino sites (an additional 7 from the existing 3 owned by the Poarch Band of Creek Indians), sports betting, and a compact with the Poarch Band. 

The Senate is expected to take up both bills in the coming weeks. 

Sen. Keith Kelly (R - Anniston) has introduced legislation that allows HVAC contractors to provide services in a more efficient and, overall, less expensive manner. 

SB 101 would clarify that HVAC contractors could complete the work on wiring directly related to HVAC on their own without the added time and expense of having to hire an electrician. Some have interpreted current Alabama law to require HVAC contractors to hire an electrician to complete installation of HVAC systems – like connecting an HVAC unit to electricity or changing the breaker to the requisite amperage. In recent years, the Alabama Electrical Contractors Board (AECB) has sought to expand its regulatory authority and has attempted to require property owners hire an electrical contractor for all forms of routine maintenance on properties. The AECB’s interpretation of current law is not only incorrect, but does not expand public safety, is unnecessary burdensome, expensive, and time consuming on property owners.

SB 101 has been referred to the Senate Fiscal Responsibility and Economic Development Committee. Passage of SB 101 would decrease the time and cost for homeowners, homebuilders, property managers, business owners, and others to have needed HVAC installations and upgrades performed.

This week, the legislature is expected to again use three legislative days with committee meetings focused on Wednesday but a few scattered on Tuesday and Thursday. It is unknown whether the gambling package will advance in the Senate this week or if additional negotiations are needed. The House is expected to take up the ballot harvesting bill, and both chambers look to move the governor’s school choice bill, called the CHOOSE Act. 

Come back next week for continued updates on the 2024 Legislative Session from your Alabama REALTORS®.