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‘Game Plan’ incentives bills now law

MONTGOMERY, Ala. (AP) — Gov. Kay Ivey signed a package of economic development incentives into law Thursday afternoon, reauthorizing and expanding tax breaks for attracting new industries only hours after lawmakers gave the legislation final approval.

The Republican governor has dubbed the four-bill package “the game plan” for economic development in Alabama.

“The Game Plan will give Alabama’s team the tools it needs to extend our winning record in economic development and help us unleash a new wave of growth and innovation across the state,” Ivey said in a statement.

Supporters said the legislation is needed to allow the state to compete for economic development projects, but some lawmakers questioned the cost and need for newly created incentives for tourism projects.

The Alabama Senate voted 29-6 earlier Thursday to approve the centerpiece of the package, a bill that reauthorizes and expands the Alabama Jobs Act and gives tax credits for capital investments and payroll rebates for job creation. The program is the state’s primary economic recruitment tool and was set to expire this year barring renewal.

The legislation authorizes the program for another five years and incrementally increases the cap on incentives from $350 million for 2022 to $475 million for 2027. It would also establish a new $10 million in incentives for tourism projects such as amusement parks, resorts, water parks and aquariums.

Senate President Pro Tem Greg Reed said the approval will “continue building on our success and providing more, higher-paying jobs to the citizens of our state.”

Lawmakers who voted against the bill expressed concern about the cost on the education budget, particularly because of new state hand-outs for tourism projects.

“Every time we chip away, take away – trying to do some good — just remember it comes at some cost. This is not Washington D.C. Every time there is a winner, there is a loser because we have limited funds,” Republican Sen. Arthur Orr, the chairman of the Senate education budget committee, said.

Alabama and other southern states have used large incentive packages, where state and local governments often work together to provide land, infrastructure work, worker training, tax breaks and rebates to lure industries. In 1993, Alabama used a $253 million incentive package to bring Mercedes-Benz to the state and has since used multiple large incentive packages to entice auto manufacturers and other industries.

Orr expressed concern that states have entered an arms race of sorts to offer larger and larger incentive packages. “My concern is how states are played against each other by the companies and the taxpayers pay,” Orr said.

Lawmakers also approved legislation to create a program where local economic development organizations could seek financial help with site development and another bill to require the state to publish information about incentive agreements on its website.

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