HB399 — what changes January 1, 2027.

What HB399 actually does.

• Caps the standard property-tax abatement at 20 years for data-processing centers, down from the prior 30-year maximum.^HB1
• Preserves the 30-year ceiling only via a binding community-benefits agreement with the Alabama Department of Revenue and the Department of Commerce. Operators must commit to qualified local investments — infrastructure, broadband, water/wastewater, education capital — to qualify for the additional ten years.^HB2
• Imposes state sales and use tax on equipment purchases for large-scale data centers (≥100 megawatts), with revenue going to the state's general fund.^HB3
• Effective date: January 1, 2027. Any project with abatement approvals on file before that date can be grandfathered under the old 30-year ceiling. That is the window Cloverleaf is racing.

Why this matters for Lowndes County.

On a $1B+ taxable investment, the difference between 30 years of full abatement and 20 years of full abatement is tens of millions of dollars — and that is the floor estimate, before compounding. That is the prize Cloverleaf is asking the County Commission to lock in before the new law takes effect.

The Alabama Legislature's unanimous vote is itself the strongest possible argument: 105 House members and 35 Senators across both parties decided the existing 30-year ceiling was too generous to the developer side of the deal. Lowndes County does not have to be the place that ratifies what the legislature already rejected.

What the County Commission can do.

1. Decline to vote on any abatement before HB399 takes effect. The County Commission is under no legal obligation to act on Cloverleaf's timeline. Waiting until January 1, 2027 means any abatement is automatically capped at 20 years.
2. If the Commission acts before HB399 takes effect, cap the abatement at 20 years voluntarily. A County Commission can grant less than the statutory maximum. A voluntary 20-year cap costs the operator nothing it would not have lost in 12 months anyway, and it preserves county revenue for the back decade.
3. Carve out the education portion of the millage in any case. Demand #04 from the coalition platform. The school board has separate authority on its own portion of the millage; the County Commission can lead by carving it out explicitly in resolution.
4. Require any community-benefits agreement to bind the operator-tenant. Demand #05. HB399's 30-year extension only triggers with a binding agreement at the state level — but the underlying agreement is what runs with the land. Make sure it does.

What the Alabama Public Service Commission could do.

HB399 is a property-tax law. The other half of the cost — the electricity bill that residential customers absorb when hyperscale loads come onto the grid — is regulated separately, by the Alabama Public Service Commission. The PSC has not yet adopted the protections that Virginia (GS-5 large-load class, effective January 2027^HB10) and Ohio (caused data-center demand requests to crash from 30 GW to 13 GW once protective rules took effect^HB11) have already implemented.

HB399 is the starting line — not the finish line. See /the-harm/power for the ratepayer side of the argument.