2025 Legislative Session: What Mobile Chamber Members Need to Know

Alabama’s 2025 legislative session delivered changes that directly affect the education system, workforce infrastructure and business environment across the state. From historic education funding and educator support to strategic investments in energy and infrastructure, these priorities will drive economic growth. Here’s what matters most for Mobile Chamber members.

Key Business & Consumer Legislation

Sales Tax Reductions

• Starting September 1, the state sales tax on most grocery items drops to 2%, saving Alabamians $122 million, annually.
• The “pink tax” was repealed, removing sales tax on essential items like diapers, formula and feminine hygiene products.

Remote Worker Income Tax Exemption

• Signed into law, this bill exempts remote workers from Alabama income tax if present in the state for fewer than 30 days/year. It enhances Alabama’s appeal to mobile talent and business travelers.

Small Business Tax Relief

• Raises the state ad valorem tax exemption threshold from $40,000 to $100,000 in market value, delivering significant tax relief to small businesses statewide.

Hemp Product Regulations

• New limits on THC products cap edibles at 10mg per serving, ban smokable hemp containing synthetically derived cannabinoids and restrict sales to adults over the age 21.
• A 10% tax and licensing requirements were introduced for retailers, impacting any Mobile businesses that sell or distribute these products.

Smartphone Safety

• Beginning in October, all smartphones and tablets sold in Alabama must include obscene content filters for minors, adding a layer of protection for youth.

Independent Pharmacy Bill

• A new law was enacted that will impose a $10.64 dispensing fee on all prescriptions, excluding specialty drugs, filled by independent pharmacies in Alabama. The Mobile Chamber opposed this legislation.

Powering Growth Act: Fueling Industrial Development in Alabama

The Powering Growth Act is a major win for Alabama’s long-term industrial strategy. It establishes the Alabama Energy Infrastructure Bank to finance energy infrastructure projects, with authority to issue up to $1 billion in bonds.

Why this matters to Mobile:

• Two new funds—the Alabama Energy Infrastructure Fund and Strategic Energy Infrastructure Development Fund—will support energy access and site readiness, critical for expanding industry in South Alabama.

Criminal Justice and Public Safety Legislation

Two bills from Governor Ivey’s public safety package were signed into law:

• House Bill 202: Expands civil and criminal immunity for law enforcement within their discretionary authority, improving protections and clarity around public safety actions.
• House Bill 199: Expands electronic monitoring for delinquent juveniles, targeting only serious offenses, and helps communities that lack the resources to manage monitoring independently.
• Senate Bill 116: Known as the “Glock switch” bill, this legislation prohibits the possession of any part or combination of parts designed or intended to convert a pistol into a machine gun. It establishes criminal penalties for violations.
• Senate Bill 118: Expands Aniah’s Law by broadening the list of offenses for which a judge may deny bond. The expansion includes solicitation, attempt, and conspiracy to commit murder, as well as discharging a weapon into an occupied dwelling.
• Senate Bill 119: Increases restrictions on firearm possession by prohibiting individuals charged with certain felony offenses from possessing firearms while released pending or during trial. The bill also increases the penalty for discharging a firearm into an occupied dwelling or building.

Record Education Investments Support Workforce and Student Success

Lawmakers passed a record-setting $12.2 billion education budget this year, with funding directed across all levels – from early childhood to higher education. This investment is critical for Mobile’s current and future workforce pipeline. The funding package includes:

• $9.9 billion Education Trust Fund
• $1.3 billion Advancement and Technology Fund
• $524 million supplemental appropriation
• $455 million from the Educational Opportunities Reserve Fund

Key allocations:

• K-12 education: $6.7 billion (up 5.9%)
• Higher education: $2.6 billion (up 6.7%)
• Other initiatives: $615 million (up 4.4%)

Highlights for our business community:

• A $100 million grant program to support regional career tech centers will help develop skilled workers for our industries.
• Continued investment in Alabama’s First Class Pre-K by adding more classrooms and providing additional seats for children, particularly in high-needs areas, and increasing the Alabama Literacy Act by $7.4 million to strengthen early education outcomes.

The passage of the RAISE Act (Renewing Alabama’s Investment in Student Excellence) introduces a funding formula that better supports high-needs students. It provides an additional $166 million to schools, helping close academic and economic gaps. For Mobile County schools serving diverse populations, this translates into $11.4 million in additional funding the district can expect to receive under the newly-adopted RAISE formula for FY26.

New Benefits for Educators and State Employees

The workforce behind our education system is also getting much-needed support:

Paid Parental Leave

• For the first time, educators and state employees will have access to paid parental leave, offering 8 weeks for mothers and 2 weeks for fathers or adopting parents (starting July 1).

Workers’ Compensation

• A dedicated compensation system will be in place by 2026 for K-12 and community college employees injured on the job, streamlining claims and easing financial burdens.

These changes enhance quality of life and workplace satisfaction—key components in talent retention and attraction.

South Alabama Legislative Delegations

The following bills were sponsored by members of the South Alabama Legislative Delegation, specifically representing Mobile and Baldwin counties. These measures, passed or enrolled during the 2025 legislative session, address local governance, infrastructure, taxation, public health and economic development across the region.

HB 1 – Seafood Dealer License Fee & Promotion
Sponsor: Rep. Brown
Increases the license fee for seafood dealers and directs a portion of the revenue to promote Alabama’s seafood industry. Encourages economic growth and marketing for local fisheries.

HB 8 / SB 2 – Regulation of Tobacco & Nicotine Delivery Products
Sponsors: Rep. Drummond / Sen. Gudger
Enhances regulation over the sale of tobacco products and electronic nicotine delivery systems. Aims to safeguard public health and limit youth access, overseen by the Alcoholic Beverage Control Board.

HB 90 – Municipal Housing Authorities Tax Exemption
Sponsor: Rep. Clarke
Grants tax exemptions and expands powers for municipal housing authorities, aiding in the development and management of affordable housing projects by reducing financial constraints.

HB 104 – Abandoned Debris in Class 2 Municipalities
Sponsor: Rep. Drummond
Authorizes Class 2 municipalities, such as Mobile, to declare certain debris abandoned and take action for its removal. Provides a legal mechanism to address health and safety hazards posed by neglected waste, enhancing community cleanliness and enforcement capacity.

HB 196 – County Juvenile Detention Management
Sponsor: Rep. Wilcox
Improves governance and procedures related to the management of juvenile detention facilities by counties. Enhances local control and accountability in the juvenile justice system.

HB 543 – Property Tax Exemption Threshold Increase
Sponsor: Rep. Brown 
Raises the market value threshold for which tangible personal property is exempt from state ad valorem taxes. Designed to lessen the tax burden on small businesses and individuals with low-value equipment or assets.

SB 46 – Scrap Tire Environmental Quality Act Enforcement
Sponsor: Sen. Sessions and Rep. Clarke
Strengthens enforcement for the Scrap Tire Environmental Quality Act in Class 2 municipalities, such as Mobile. It includes criminal penalties and extends municipal court jurisdiction, supporting better environmental practices for scrap tire management.

SB 110 – Trucks; Portable Scales & Weight Limit Exemptions
Sponsor: Sen. Williams 
Updates enforcement protocols for vehicle weight limits, particularly for trucks. Revises procedures for portable scale use and grants enhanced authority to enforcement personnel to ensure road safety and compliance.

SB 221 – Mobile County Judge of Probate Compensation
Sponsor: Sen. Williams 
Adjusts compensation for the Judge of Probate in Mobile County based on administrative and judicial duties. Supports equity and efficiency within the county’s judicial offices.

SB 224 – Mobile County Electronic Monitoring
Sponsor: Sen. Sessions
Expands and updates regulations regarding electronic monitoring for individuals in the judicial system. Offers alternatives to incarceration while ensuring improved compliance and supervision.

SB 256 – Mobile County Tax Liens & Property Access
Sponsor: Sen. Sessions
Allows Mobile County municipalities to include certain weed liens in tax bills, streamlines tie-breaking in tax lien auctions and grants authority to enter properties for needed repairs. Enhances the legal framework for collecting delinquent taxes and maintaining public safety.

What This Session Means for Mobile Chamber Members

The 2025 legislative session reflects Alabama’s commitment to education, infrastructure and workforce readiness – key pillars of economic development. For businesses and industries in Mobile, these investments improve the talent pipeline, support industrial expansion and promote a more stable business environment.

The Mobile Chamber will continue to monitor implementation and ensure these statewide changes translate into local opportunities. We encourage our members to stay engaged as new programs and funding become available.

If you have questions or want to explore how these legislative updates impact your business or organization, reach out to our Governmental Affairs team.

Nancy W. Hewston
Vice President of Communications and Advocacy
P.O. Box 2187  |  Mobile, AL 36652
Phone: 251-431-8618
NHewston@mobilechamber.com

Layton Little
Director of Government Affairs
P.O. Box 2187 | Mobile, AL 36652
Phone: 251-431-8601
LLittle@MobileChamber.com