Alabama tax exemption for COVID-19 aid that helped many through pandemic passes House

The Alabama Legislature on Thursday moved three bills Gov. Kay Ivey and legislative leaders consider priorities for the session. 

Bills to limit lawsuits related to COVID-19; remove state taxes from federal COVID-19 relief and renew economic incentives passed their respective chambers Thursday. 

The House voted 94 to 0 for a bill sponsored by Rep. Danny Garrett, R-Trussville, that would exempt federal coronavirus aid from income taxes and also provide additional changes to business. The exemptions would also apply to any aid the federal government approves in 2021. 

"Any person or entity that received coronavirus relief under those acts will be excluded (from income taxes)," Garrett said.

The bill moves to the Senate for consideration. 

The House later voted 94 to 1 to approve a bill sponsored by Rep. Bill Poole, R-Tuscaloosa. The legislation addresses two tax credit programs. It renews the Growing Alabama Act, which allows taxpayers to deduct contributions made to economic development organizations. The law expired on Sept. 30. The bill also expanded the deduction limit under the law from $10 million to $20 million and expanded the taxes the credit can be claimed against. 

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Poole's bill also creates new credits for utility and medical companies; increases the minimum number employees a technology company needs to employ to qualify for a credit from five to 10; increases the cap on credits from $300 million to $350 million by 2022; creates incentives for port workers, and creates incentives for businesses headed by women or Black Alabamians. 

The legislation provoked a lengthy discussion from representatives, mainly over what kind of workers would be hired and who might be left out. Rep. A.J. McCampbell, D-Linden, asked if the bill would require companies qualifying for the incentives to hire full-time workers, saying several companies in his area had qualified for the measures by hiring part-timers. 

"We specifically don’t want these to be part-time positions, nor do we want them outsource to temp agencies," he said.

Republicans from rural districts also questioned the current population limits for incentives in the bill. Rep. Andrew Sorrell, R-Muscle Shoals, who voted against the bill, said it did not include enough small businesses, and questioned by the minority-definition did not include Hispanic Alabamians.

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"I think this bill is unintentionally picking winners and losers, and that's the problem I have with this bill," he said. Like Garrett's bill, Poole's goes to the Senate.

The Senate passed a bill Thursday morning that will limit lawsuits related to COVID-19. The measure, sponsored by Sen. Arthur Orr, R-Decatur, says businesses, health care providers, schools, governments, cultural institutions and their officers and employees "shall not be liable for any damages, injury, or death suffered by any person or entity as a result of, or in connection with, a health emergency claim that results from any act or omission of the covered entity."

The bill allows for damages in a plaintiff proves "with clear and convincing evidence" that the covered entity caused damage, injury or death through  "wanton, reckless, willful, or intentional misconduct. It also requires such claims to filed within two years of the alleged misconduct. The bill does not affect workers compensation claims.

Senators approved the measure 27 to 1, with Sen. Vivian Davis Figures, D-Mobile, the only dissenting vote. It moves to the House. 

Leaders of both chambers said they wanted to pass the three bills before an expected break in the session the week of Feb. 15. 

Contact Montgomery Advertiser reporter Brian Lyman at 334-240-0185 or blyman@gannett.com.