FISCAL NOTE

House Bill 297 as introduced amends the Railroad Modernization Act of 2019 to extend the program from December 31, 2022, currently, to December 31, 2027; and for tax years 2023 through 2027: (1) increases the per-mile cap on the income tax credit available under current law from $3,500 per mile, currently, to $5,000 per mile annually; (2) increases the total amount of income tax credits that may be claimed in a tax year from $3.7 million, currently, to $5.5 million; and (3) caps the cumulative amount of tax credit that may be claimed over this period at $27.5 million.

This bill could reduce receipts to the Education Trust Fund by a maximum of $5.5 million annually in fiscal years 2024 through 2028 ($27.5 million total) dependent on the amount of tax credits claimed each year. According to the Department of Commerce, the current cap of $3.7 million in tax credits were reserved in tax years 2020 and 2021, and $1,444,679 in tax credits claimed were claimed in tax year 2021.

Pursuant to the provisions of the ETF Rolling Reserve Act contained in Section 29-9-3(b)(3), Code of Alabama 1975, the provisions of this bill will reduce the ETF fiscal year appropriation cap for fiscal year 2024 by $5.5 million.