Section 40-9B-3

Definitions.

For purposes of this chapter, the following words and phrases mean:

(1) ABATE, ABATEMENT. A reduction or elimination of a taxpayer's liability for tax. An abatement of transaction taxes imposed under Chapter 23 of this title, shall relieve the seller from the obligation to collect and pay over the transaction tax as if the sale were to a person exempt, to the extent of the abatement, from the transaction tax.

(2) CONSTRUCTION RELATED TRANSACTION TAXES. The transaction taxes imposed by Chapter 23 of this title, on tangible personal property and taxable services incorporated into an industrial development property, the cost of which may be added to capital account with respect to the property, determined without regard to any rule which permits expenditures properly chargeable to capital account to be treated as current expenses.

(3) EDUCATION TAXES. Ad valorem taxes that must, pursuant to the Constitution of Alabama of 1901, as amended, legislative act, or the resolution or other action of the governing board authorizing the tax, be used for educational purposes or for capital improvements for education and local construction related transaction taxes levied for educational purposes or for capital improvements for education.

(4) INDUCEMENT. Refers to an agreement, or an "inducement agreement," entered into between a private user and a public authority or county or municipal government and/or a resolution or other official action, an "inducement resolution," "inducement letter," or "official action" adopted by a public authority or county or municipal government, in each case expressing, among other things, the present intent of such public authority or county or municipal government to issue bonds in connection with the private use property therein described.

(5) INDUSTRIAL DEVELOPMENT PROPERTY. Real and/or personal property acquired in connection with establishing or expanding an industrial or research enterprise in Alabama.

(6) INDUSTRIAL OR RESEARCH ENTERPRISE. a. Any trade or business described in 1987 Standard Industrial Classification Industry Group Number 0724, Major Groups 20 to 39, inclusive, 50 and 51, Industrial Group Number 737, and Industry Numbers 4613, 8731, 8733, and 8734, as set forth in the Standard Industrial Classification Manual published by the United States Government Office of Management and Budget.

b. With respect to abatements granted in accordance with Section 40-9B-9, and only with respect to such abatements, "industrial or research enterprise" means any trade or business described in the 1997 North American Industry Classification System within Subsector 493 (Warehousing and Storage), Industry Number 488310 (Port and Harbor Operations), or Industry Number 488320 (Marine Cargo Handling), when such trade or business is conducted on premises in which the Alabama State Port Authority has an ownership, leasehold, or other possessory interest and such premises are used as part of the operations of the Alabama State Port Authority.

c. "Industrial or research enterprise" includes the above-described trades and business and any others as may hereafter be reclassified in any subsequent publication of the NAICS or similar industry classification system developed in conjunction with the United States Department of Commerce or Office of Management and Budget.

(7) MAJOR ADDITION. Any addition to an existing industrial development property that equals the lesser of: 30 percent of the original cost of the industrial development property or two million dollars ($2,000,000). For purposes of this subsection, the original cost of existing industrial development property shall be the amount of industrial development property with respect to which an abatement was granted under this chapter when the property was constructed, or if the existing industrial development property was constructed before January 1, 1993, the maximum amount that would have been allowed if the provisions of this chapter had applied at the time it was constructed. Only property that constitutes industrial development property shall be taken into account in making the determination in the previous sentence.

(8) MAXIMUM EXEMPTION PERIOD. A period equal to the shorter of: a. Ten years from and after: 1. The date of initial issuance by a county, city, or public authority of bonds to finance any costs of a private use property, or 2. If no such bonds are ever issued, the later of: (i) The date on which title to such property was acquired by or vested in such county, city, or public authority, or (ii) The date on which such property is or becomes owned, for federal income tax purposes, by a private user; or b. The weighted average economic life of the assets comprising such property, determined consistently with the provisions of 26 U.S.C. § 147(b) and measured from the date such property is placed in service.

(9) MORTGAGE AND RECORDING TAXES. The taxes imposed by Chapter 22 of this title.

(10) NONEDUCATIONAL AD VALOREM TAXES. Ad valorem taxes imposed by the state, counties, municipalities, and other taxing jurisdictions of Alabama that are not required to be used for educational purposes or for capital improvements for education.

(11) PERSON. Includes any individual, partnership, trust, estate, or corporation.

(12) PRIVATE USER. Any individual, partnership, or corporation organized for profit that is or will be treated as the owner of private use property for federal income tax purposes.

(13) PRIVATE USE INDUSTRIAL PROPERTY. Private use property that also constitutes industrial development property.

(14) PRIVATE USE PROPERTY. Any real and/or personal property which is or will be treated as owned by a private user for federal income tax purposes even though title may be held by a public authority or municipal or county government.

(15) PUBLIC AUTHORITY. A corporation created for public purposes pursuant to a provision of the Constitution of Alabama of 1901, or a general or local law that authorized it to issue bonds, the interest on which is exempt from the Alabama income tax, as in effect on May 21, 1992.

(16) PUBLIC INDUSTRIAL AUTHORITY. A public authority authorized to issue bonds to acquire, construct, equip, or finance industrial development property.

(Acts 1992, No. 92-599, p. 1239, §3; Acts 1995, No. 95-321, p. 683, §1; Acts 1996, No. 96-647, p. 1030, §1; Act 2001-503, p. 886, §12.)