(a) Any authority formed under this chapter, a cooperative district of which the authority is a constituent member, the sales, property, and income of the authority or cooperative district, whether used by it or leased to others, all bonds issued by the authority or cooperative district, the income from the bonds or from other sources, the interest and other profits from the bonds inuring to and received by the holders thereof, conveyances by and to the authority or cooperative district of which the authority is a member, and leases, mortgages, and deeds of trust by and to the authority or the cooperative district are exempt from all taxation in the state, inclusive of any ad valorem taxes or lodgings taxes imposed by the State of Alabama, a municipality, or county. The authority is exempt from the payment of any fees, taxes, or costs to the judge of probate of any county in connection with its incorporation or with any amendment to its certificate of incorporation or otherwise or to any judge of probate of any county in connection with the recording by it of any document or otherwise. No license or excise tax may be imposed by any authority with respect to the privilege of engaging in any of the activities authorized by this chapter.
(b) An authority, any cooperative district of which an authority is a member, and any private user is exempt from the payment of all state, county, and municipal sales and use taxes relating in any way to the construction, operation, and maintenance of the project. The exemption set forth in this section may be conditioned (1) by the authorizing subdivision on a payment by the exempt party of a payment in lieu of tax; or (2) by the authority on a payment by the private user of a payment in lieu of tax pursuant to subdivision (21) of Section 11-92C-8, or by both subdivisions (1) and (2) which shall be subject to enforcement and collection like any sales and use taxes and which shall constitute a first lien on the project and shall be foreclosable in the same manner as a past due assessment pursuant to Section 11-92C-15. The exemption provided in this subsection shall apply to any cooperative district of which the authority is a constituent member, and any private user which leases, operates, or manages a project owned by the authority or cooperative district of which the authority is a member.
(c) Notwithstanding subsections (a) and (b), an authority or a cooperative district of which an authority is a member shall be subject to sales and use taxes, income tax, and ad valorem tax upon the first day of the third calendar month following 20 years after the date of the incorporation of the authority.
(d) Any payments in lieu of taxes received by an authority, as set forth in this section, shall be dedicated to the payment of bonds financing or refinancing the projects of the authority, including, but not limited to, accelerated payments and reserve payments. Any funds from the in-lieu-of tax payments remaining with the authority after all bonds financing or refinancing the projects are fully paid, in excess of the amounts necessary to fully repay the bonds, shall be transferred to the governmental entity or entities that would have received the tax revenue if not for the tax exemption and corresponding payment in lieu of tax.
Last modified: May 3, 2021