The Alabama Legislature concluded its 30th and final legislative day last Wednesday, officially adjourning sine die and ending its work for the 2025 Regular Session. The Legislature is scheduled to reconvene in January 2026 for the final year of the current four-year term.
Senate Gridlock Kills Dozens of Local Bills
Tensions and procedural delays in the Senate led to the demise of approximately 50 local bills as the 2025 legislative session drew to a close on Wednesday. The Senate’s difficulties stemmed from ongoing disagreements over local courtesy, perceived unfairness in the handling of some members’ local legislation, and lingering friction following the recent passage of the Birmingham Water Works reform bill.
Senate Democrats significantly slowed the typically rapid process of voting on these non-controversial bills, which addressed specific county or municipal issues. Their actions were in protest of what they considered unfair treatment in the House of their own local bills, particularly Sen. Bobby Singleton’s SB90 regarding gambling operations in Greene County.
While the House had swiftly passed numerous bills earlier in the day and then recessed to await Senate action, the Senate struggled to make progress. Despite eventually passing a few local bills after invoking cloture to overcome the Democratic slowdown, it became clear by early evening that the vast majority of the pending local legislation would not receive final passage. Consequently, the Senate shifted its focus to adopting a new calendar, which included consideration of one of Gov. Kay Ivey’s key bills, effectively leaving most of the awaiting local bills dead.
Governor’s Priority “Back the Blue” Bill Passes
One of the final pieces of legislation to pass this year was HB202, Rep. Rex Reynolds’ bill modifying the determination of civil and criminal liability for law enforcement officers. Proponents asserted the bill was crucial to support law enforcement agencies facing recruitment and retention challenges, while opponents contended it could shield “bad” officers from accountability. The new law will:
- Grant civil and criminal immunity for actions taken within an officer’s “discretionary authority,” provided the action is not recklessly without law enforcement justification.
- Entitle law enforcement officers to a pre-trial hearing within 45 days of facing charges or litigation to determine immunity.
- Grant law enforcement officers an immediate right to petition the Alabama Supreme Court during an ongoing case if their immunity claim is denied.
The Senate adopted a substitute version of the bill and passed it with a 25-6 vote. The House swiftly concurred with a 73-28 vote before midnight, sending the legislation to Gov. Ivey, who signed it into law on Thursday.
Bill Mandating Immigration Checks and Criminalizing Human Smuggling Granted Final Passage
The House of Representatives passed SB53, sponsored by Sen. Wes Kitchens, on Wednesday with an 80-15 vote, with 5 abstentions. The bill now goes to Gov. Ivey for her consideration.
SB53 requires administrators of state, county, or municipal jails to make an effort to ascertain the immigration status of individuals arrested and detained in their facilities. Furthermore, the bill establishes the offense of human smuggling as a Class C felony, carrying a potential prison sentence of up to 10 years for anyone who knowingly transports an individual illegally present in the United States into Alabama. The legislation includes specific exemptions for medical professionals, educators, attorneys, religious institutions, and charitable organizations involved in non-commercial activities when transporting such individuals.
Two Tax Cut Bills Signed into Law; Three Others Stall in Senate
Despite the failure of three proposed tax cut bills, Gov. Ivey has signed two significant tax reduction measures into law.
Grocery and Baby Item Tax Cuts Enacted:
- HB152, sponsored by Rep. Neil Rafferty, eliminates the state’s 4% sales tax on essential baby and maternal care products, including diapers, baby formula, baby wipes, pumping equipment, baby bottles, maternity clothing, and menstrual hygiene products. This exemption will take effect on Sept. 1, 2025, and is slated to expire on Aug. 31, 2028, unless the Legislature acts to extend it. The state Education Trust Fund is projected to see an annual reduction of approximately $13 million due to this measure.
- HB386, also signed into law by Gov. Ivey, reduces the state sales tax on grocery items from 3% to 2%. This widely supported tax cut is estimated to decrease the Education Trust Fund by roughly $121.6 million annually. However, the concurrent expiration of the state income tax exemption on overtime earnings next month is expected to result in a net positive impact on the Education Trust Fund, given the overtime exemption’s estimated annual effect of over $200 million.
Three Tax Cut Bills Stalled in Senate
Three other tax cut proposals failed to receive final votes in the Senate before the Legislature adjourned on Wednesday. These bills, all ready for final passage in the Senate, included:
- HB387: This bill, initially intended to complement the grocery sales tax cut by addressing local jurisdictions’ ability to reduce their own grocery taxes, was substituted in the Senate to propose a 0.25% reduction in the state’s manufacturing machine sales tax rate, lowering it from 1.5% to 1.25%.
- HB388: This bill aimed to double the state’s income tax exemption for individuals 65 years or older withdrawing funds from a defined contribution plan, increasing it from $6,000 to $12,000.
- HB389: This bill proposed various adjustments to the thresholds for certain filers and income levels for state income tax purposes, notably increasing the floors for dependent exemptions, raising the optional standard deduction, and increasing threshold caps for claiming certain exemptions.
Governor Ivey Enacts Stricter Hemp and Vape Regulations
Gov. Kay has signed into law HB8, which introduces more stringent regulations for vaping products, and HB445, which establishes significant regulations and taxes on hemp products containing THC. Despite lobbying efforts from numerous hemp and vape businesses urging a veto, citing concerns about potential business closures and investment losses, the bills have now become law.
Our governmental relations team tracked the following bills:
| Bill | Sponsors | Title | Last Action | Latest Version |
| AL 2025rs SB 282 |
Barfoot | Virtual currency, declares preemption of virtual currency or cryptocurrency regulation by the Legislature and exempts virtual currency from ad valorem tax | Senate, May 6, 2025: Currently Indefinitely Postponed | Introduced |
| AL 2025rs SB 281 |
Shelnutt | Consumer Protection; platforms providing services allowing employees to access earned income prior to paycheck not considered a lender or debt collector; standards on platforms imposed | Senate, May 6, 2025: Currently Indefinitely Postponed | Introduced |
| AL 2025rs SB 77 |
Weaver | International wire transfers; fee on wire transfers imposed; income tax credit for wire transfer fees paid, authorized; Securities Commission and Revenue Department to administer | Senate, May 6, 2025: Currently Indefinitely Postponed | Introduced |
| AL 2025rs SB 29 |
Elliott | Government issued licenses, permits, and certifications; time frame imposed for issuing licenses etc.; exceptions provided | Senate, May 6, 2025: Currently Indefinitely Postponed | Introduced |
| AL 2025rs HB 483 |
Shaw | Virtual currency, declares preemption of virtual currency or cryptocurrency regulation by the Legislature and exempts virtual currency from ad valorem tax | House, May 6, 2025: Currently Indefinitely Postponed | Introduced |
| AL 2025rs HB 297 |
Fidler | Cash transactions; report certain cash transactions to Alabama Securities Commission required (Banking and Insurance (Senate)) | Senate, May 1, 2025: Pending Committee Action in Second House (Banking and Insurance) | Engrossed |
| AL 2025rs HB 610 |
Harrison | Constitutional Amendment; authorizing Legislature to establish a state bank; create a commission to operate bank or designate a state agency to oversee its operations (Financial Services (House)) | House, Apr 24, 2025: Pending Committee Action in House of Origin (Financial Services) | Introduced |
| AL 2025rs HB 587 |
Shaw | Information Technology Auditors, qualifications for being hired to perform audits on state chartered financial institutions specified (Financial Services (House)) | House, Apr 17, 2025: Pending Committee Action in House of Origin (Financial Services) | Introduced |
| AL 2025rs HB 396 |
Paschal | Taxation and Revenue; Homestead ad valorum taxes of certain veterans prohibited from inclusion in debt-to-income ratio
Senate Calendar: Regular Calendar (May 14, 2025) Position: 53 |
Senate, Apr 17, 2025: Read for the Second Time and placed on the Calendar (Finance and Taxation General Fund) | Introduced |
| AL 2025rs SB 130 |
Melson | Financial Institutions and Businesses; authorizes gold and silver bullion and coins as legal tender | Senate, Apr 14, 2025: Enacted | Act Number 2025-123 |
| AL 2025rs HB 484 |
Shaw | Public Blockchain, creation of; inclusion of certain state expenditures. (Ways and Means General Fund (House)) | House, Apr 8, 2025: Re-referred to Committee in House of Origin (Ways and Means General Fund) | Introduced |
| AL 2025rs SB 284 |
Barfoot | Public Blockchain, creation of; inclusion of certain state expenditures. (Banking and Insurance (Senate)) | Senate, Apr 1, 2025: Pending Committee Action in House of Origin (Banking and Insurance) | Introduced |
| AL 2025rs SB 283 |
Barfoot | State Treasurer, investment of funds in digital assets (Banking and Insurance (Senate)) | Senate, Apr 1, 2025: Pending Committee Action in House of Origin (Banking and Insurance) | Introduced |
| AL 2025rs HB 482 |
Shaw | State Treasurer, investment of funds in digital assets (Ways and Means General Fund (House)) | House, Apr 1, 2025: Pending Committee Action in House of Origin (Ways and Means General Fund) | Introduced |
| AL 2025rs HB 418 |
Kiel | Financial Institutions and Insurers; using social credit score to discriminate prohibited; violations of insurers an unfair trade practice; fines, penalties and remedies authorized (Financial Services (House))
Companion Bills: SB 228 |
House, Mar 6, 2025: Pending Committee Action in House of Origin (Financial Services) | Introduced |
| AL 2025rs SB 228 |
Jones (A) | Financial Institutions and Insurers; using social credit score to discriminate prohibited; violations of insurers an unfair trade practice; fines, penalties and remedies authorized (Banking and Insurance (Senate))
Companion Bills: HB 418 |
Senate, Mar 5, 2025: Pending Committee Action in House of Origin (Banking and Insurance) | Introduced |
| AL 2025rs SB 141 |
Butler (T) | Financial Institutions; prohibit fee for periodic paper billing statements (State Governmental Affairs (Senate)) | Senate, Feb 11, 2025: Pending Committee Action in House of Origin (State Governmental Affairs) | Introduced |
| AL 2025rs HB 192 |
Shirey | International wire transfers; fee on wire transfers imposed with proceeds for ELL instructors; income tax credit for wire transfer fees paid, authorized; Securities Commission and Revenue Department to administer (Ways and Means Education (House)) | House, Feb 5, 2025: Pending Committee Action in House of Origin (Ways and Means Education) | Introduced |
| AL 2025rs SB 17 |
Coleman (M) | Digital assets, prohibits the state from certain actions related to digital assets and exempts certain actions from classification as a security or money transfer (Banking and Insurance (Senate)) | Senate, Feb 4, 2025: Pending Committee Action in House of Origin (Banking and Insurance) | Introduced |
