Alabama 2026 Legislative Highlights
The 2026 Alabama Legislative session ended on April 9th but lawmakers were brought back for a special session May 4th through May 8th to address primary election legislation. Over 1,000 bills were introduced during the regular session with only 402 passing both chambers. We followed several bills that impact business. Two that were enacted relate to business finances. This session focused heavily on workforce development, economic growth and cost relief.
Senate Bill 15, brought by 3rd District Senator Sam Givhan (R), created a voluntary state mechanism for state entities to liquidate their assets and distribute proceeds in lieu of filing federal bankruptcy. This act is the Uniform Assignment for Benefit of Creditors Act. This act: (1) creates a uniform state-level alternative to federal bankruptcy that allows a debtor to voluntarily assign their assets to a fiduciary to liquidate the assets and distribute the proceeds to the assignee's creditors; (2) establishes requirements for assignment agreements, including for those who may enter into agreements, form and content of agreements, and assets subject to inclusion; (3) establishes requirements for filing and recording financial statements and the effect on transferring title; (4) unless waived, requires an assignee to notify creditors of assignment and provides requirements for such notification; (5) provides duties, powers, and limitations of liability for assignors and assignees, including the discharge, succession, and removal of assignees; (6) provides for allowed and disallowed, disputes as to, and proof of creditor claims, including authorizing assignees discretion to allow claims under certain circumstances; (7) grants transferees of assets certain rights; (8) provides for the distribution of assignees' assets and proceeds among creditors and the assignment estate, including claim subordination; (9) provides for the winding up and final accounting of an assignment; (10) requires the recognition and enforcement of assignments made in other states if result would be substantially similar in this state; and (11) grants circuit courts jurisdiction to hear and resolve assignment disputes. It was signed by the Governor and becomes effective, October 1, 2026.
House Bill 517, brought by 20th District Representative James Lomax (R) as named sponsor and eight other House Representatives, establishes the Talent Readiness and Industry Needs (TRAIN) Act to authorize businesses to partner with eligible educational institutions, including community colleges, local education agencies, and public high schools, to provide career and technical instruction. This act: (1) establishes state income and financial institution excise tax credits, beginning January 1, 2027, and ending December 31, 2031, for employers that loan qualified career technical education (CTE) employees to teach at eligible educational institutions, equal to an employee's salary payments or donations to community development foundations that support a CTE program or an instructor's salary; (2) sets an aggregate $10 million annual limit on statewide credits, limits donation credits to $4 million annually, and limits individual taxpayer credits to $250,000 annually or not more than 50 percent of tax liability; (3) conditions employers receiving a tax credit on satisfying certain criteria, including employers and eligible educational institutions entering into memorandums of understanding containing specified terms and employers receiving a TRAIN Act credit reservation certificate from the Department of Education; (4) authorizes the Departments of Education, Revenue, and Workforce to adopt rules to administer and enforce this act; (5) requires the Department of Education to annually report to the Legislature information on this tax credit; and (6) establishes and provides a process to obtain a workforce teaching certificate from the Department of Education authorizing employees to teach designated career and technical education programs at eligible educational institutions. It was signed by the Governor and becomes effective, October 1, 2026.
