“The bill provides for long-term growth by creating jobs, improving energy competition and putting more taxpayers on the role to help fill our budget gap. That is a powerful impact,” said Sen. Greg Reed (R-Jasper), the senate sponsor to the bill introduced by Rep. Bill Roberts (R-Jasper).
The measure allows coal companies to apply for abatements on sales, use, mortgage, deed and non-educational property taxes. The provision also includes a 5 percent income tax credit for companies that invest beyond $1 million in the coal industry, referred to as an income tax capital credit.
The state currently offers the tax incentives to manufacturers and other industries. Roberts’ bill simply adds coal companies to the list.
“The purpose of the bill is to develop new coal mining opportunities for the Walker County area,” Roberts said earlier this month when the bill passed the House of Representatives. “We often think about economic development, and we forget about the mining industry being our biggest employer.”
Though the legislation will spur development of coal mines throughout the state, Reed said it will directly encourage an operation under consideration by Walter Energy, Inc. Reed said officials with the company plan to set up the mine in northern Tuscaloosa County.
Reed said the operation will create 400 to 500 direct, full-time jobs and hundreds more counting the preparation for the mine. Overall, he said that could mean a $1 billion impact for his district.
“We are actively working to pass legislation that will create jobs, and this bill is going to allow us to do that,” Reed said. “Putting Alabamians back to work is our top priority, and I’m proud to carry this legislation in the senate.”
Roberts said the Senate’s version of the bill reduces the level of tax incentives by half compared to the House version. The change means the bill must go to a conference committee before coming to Gov. Robert Bentley’s desk for signature.
Sen. Trip Pittman introduced the provision cutting the incentives by half. He said he feels the coal industry is doing well financially, and the incentives should be reserved for manufacturing companies considering a move to Alabama.
“The coal is not going anywhere,” he said.
Roberts said the conference committee is scheduled for Tuesday, and he is confident lawmakers will find a compromise.