MONTGOMERY — A recently-passed bill aimed to spur job growth in rural and urban areas of the state has been signed into law by Gov. Kay Ivey.

Sponsored by Rep. Bill Poole, R-Tuscaloosa, House Bill 540, dubbed the Alabama Incentives Modernization Act, is a set of tax incentives designed to enhance development in counties that are experiencing slow economic conditions and to help bring new technology companies to the state. Proponents of the legislation say it enhances current incentives, encourages investments in designated opportunity zones and offers a capital gains tax cut for tech companies moving to Alabama.

“I think the title signals its importance in terms of modernizing some of our incentives on a couple of levels,” Poole said. “First of all, we want to make sure the existing incentive programs across the state are allowing areas to be eligible, but we also want to open up the industry areas to make sure that technology, research and knowledge-based jobs, industries and investments can be eligible as well.”

The bill passed unanimously in the House and Senate each time it came up for a vote.

There are federal opportunity zones across the state that also are eligible for incentives. These areas are generally ones that are struggling financially. Poole said the change in the law will add a layer to those federal incentives in hopes of enticing industry and businesses from outside the state to relocate to these struggling areas. These opportunity zones were created when Congress passed the Tax Cuts and Jobs Act of 2017.

Additionally, the bill expands the number of rural counties that can qualify for incentives under the Alabama Jobs Act that was passed in 2015. Previously, counties had to have 25,000 or fewer people to be considered rural; under the new law, counties with 50,000 or fewer people now qualify.

Previously the counties that qualified for rural economic incentives were Greene, Perry, Lowndes, Bullock, Wilcox, Coosa, Conecuh, Sumter, Choctaw, Clay, Crenshaw, Lamar, Hale, Cleburne, Washington, Fayette, Henry, Macon, Marengo, Butler, Pickens, Monroe, Bibb, Randolph, Winston, Clarke and Barbour.

Now, Cherokee, Geneva, Marion, Franklin, Lawrence, Pike, Chambers, Escambia, Covington, Dallas, Tallapoosa, Chilton and Dale counties also qualify, according to the Alabama Department of Labor. That’s 40 out of Alabama’s 67 counties.

Sen. Arthur Orr, R-Decatur, amended the bill in a Senate committee so that the investment credit can be used in “jumpstart counties,” which have lost population over the past five years, as calculated by the Alabama Department of Labor. A list of such counties wasn’t available from that department, but Orr said Morgan and Colbert counties in north Alabama would be included.

“It will give them the enhanced incentives like a rural county to help them grow,” Orr said this week. “If counties are not growing, it’s a problem.”

Separately, Orr’s amendment allows local economic development organizations to apply to the Alabama Department of Commerce for infrastructure improvements at industrial or research parks and capital improvements or economic development activities at inland port or intermodal facilities.

In a different bill, Orr tried to get some of the revenue from the recently approved gas tax increase into a separate fund for inland port and intermodal facilities. That legislation died.

Under the AIM Act, incentives such as investment and tax credits will be awarded to companies that bring in at least 10 new jobs to a county that has had sluggish job growth and a declining population. It also creates specific incentives for tech companies, which would only need to create five jobs to qualify for the investment and tax credits.

The act also eliminates the tax on capital gains for investors and employees of technology companies that move to Alabama if they relocate to the state at least three years before being sold and stay for five years after the company is sold.

“Job creation is one of the top priorities of the Legislature, and we have and will continue to do anything we can to create economic development opportunities that benefit our rural communities and in turn benefit the entire state of Alabama,” Senate President Pro Tem Del Marsh, R-Anniston, said.

Alexander Flachsbart, founder and CEO of the non-profit Opportunity Alabama, is excited about the bill.

“This thing does a lot more than opportunity zones,” Flachsbart said. “It helps make major capital investments in rural communities, it’ll make major industrial projects more attractive, it creates a whole new tax regime around capital gains. It does a whole lot of really great things for the state of Alabama. It’s truly remarkable that we have in Alabama the first impact-oriented Incentives regime around opportunity zones in the U.S.”

Flachsbart added that, in terms of a return on investment, the state could in theory realize a growth in revenue from these projects and investments coming into Alabama.

One project specifically mentioned in the AIM Act is the planned 5,000 seat, 15,000-square-foot, multi-function, agriculture event facility to be built in Clanton. Matthew Durdin, director of external affairs for the Alabama Farmers Federation, said the Farm Center at Centennial Park will be able to host events ranging from rodeos and animal expositions to home and garden and car shows.

Clanton and Chilton County are rural but located within a 60-mile range from 1.2 million Alabamians. Durdin said the center’s aim was to bring in not only Alabamians but people from the region and around the country to visit and spend money in central Alabama.

“The Alabama Farmers Federation’s 100th anniversary is in 2021, so to give back to our members, we planned this farm center in Clanton,” Durdin said. “Our project is calling for 11 total structures out there. We estimate there could be possibly 230 show days at the park.”

Durdin expects for the park to initially open by August 2021 and eventually be completed sometime around the fall of 2022.