AL Code § 40-18-403 (2021)
2021 Code of Alabama|Title 40 - Revenue and Taxation.|Chapter 18 - Income Taxes.|Article 18 - Tax Credit for Use of Port Facilities.|Section 40-18-403 - Port Credits.

Section 40-18-403Port credits. (a) If approved by the commission, a port credit is allowed, in an amount equal to fifty dollars ($50) per TEU, three dollars ($3) per net ton, four cents ($0.04) per kilogram for air freight, or two dollars and ninety-one cents ($2.91) per VEU, multiplied by the following: (1) The port user's cargo volume in the 12-month period for which the commission has granted approval for the port user to claim the port credit, minus (2) The port user's base cargo volume. (b) The commission shall decrease the amount of the port credit to ensure that the anticipated revenues for the port facility and state will exceed the amount of the port credit sought. The port credit may be conditioned on whatever requirements the commission shall impose. The port credits shall only be available to the extent that a port facility user ships more than 105 percent of its cargo volume from the 12-month period immediately preceding the port facility user's application. Moreover, the port credit shall only be available to the extent a port facility user ships more than 10 TEUs, for cargo measured by TEU, more than 75 net tons, for cargo measured by net ton, more than fifteen thousand (15,000) kilograms for air cargo measured by kilograms, or more than 400 VEUs, for cargo measured by VEU. (c) The following methods may be used to realize the port credit: (1) The port credit may offset the tax levied by this chapter, but not below zero. The port credit may also offset the estimated payments of the tax levied by this chapter, but not below zero. In no event shall the port credits be allowed to reduce any estimated payment of the tax levied by this chapter before October 1, 2016. In any one year, if the port credit exceeds the amount of tax liability, the port user may carry forward the unused port credit. No carryforward shall be allowed for more than five years. Rules similar to those used for Section 40-18-15.2 shall be applied. (2) A company may assign and convey a port credit to another company if substantially all of the assets of the company are assigned and conveyed in the same transaction. Proof of such transfer shall be submitted to the Department of Revenue. (d) To the extent that the port credit is utilized by the port user or by a transferee company, no deduction for the related expenses shall be allowed. (e) For any company which enters into an economic development project agreement with the state, the project agreement may provide for an allocation to the company of any port credits which have not been allocated pursuant to this article. Allocations made pursuant to this subsection shall meet all of the following requirements: (1) Allocations shall be made by the Governor and approved by the commission. (2) Allocations for a project shall not exceed three million dollars ($3,000,000). (3) Allocations shall be granted only to a new warehouse or distribution facility which commits to investing at least twenty million dollars ($20,000,000) at a single site and to creating 75 net new jobs in Alabama. (4) Port credits may not be used until the Department of Commerce has received satisfactory proof that the capital investment and job creation requirements have been satisfied. (5) Any port credit granted by this procedure shall not be granted for more than a 3-year period. (6) Allocations shall not exceed one hundred dollars ($100) per TEU, three dollars ($3) per net ton, four cents ($0.04) per kilogram for air freight, or two dollars and ninety-one cents ($2.91) per VEU. (7) Anticipated revenues for the state shall exceed the port credit granted, and the project agreement shall provide for recapture of all or part of the port credit should the company default on its obligations in the project agreement. (Act 2016-102, p. 148, §2; Act 2021-2, §1.)