There is hereby created and established the Department of Economic and Community Affairs within the Office of the Governor and directly under his supervision and control. The Department of Economic and Community Affairs shall consist of: the Governor, the Office of State Planning and Federal Programs, the Alabama Department of Energy, the Alabama Law Enforcement Planning Agency, the Office of Highway and Traffic Safety, the Office of Employment and Training, and the Office of Water Resources as presently created by and provided for in Sections 41-9-205 through 41-9-214, Sections 41-6A-1 through 41-6A-11, Sections 41-8A-1 through 41-8A-4, Sections 41-8A-8 through 41-8A-10, and Sections 41-8A-12 through 41-8A-13, 32-4-1 through 32-4-7, Executive Order No. 34, 1980, and Sections 9-10B-1 through 9-10B-30, respectively, and in accordance with the applicable federal laws. All respective functions, duties, responsibilities, obligations, property rights, appropriations, employees, property, and supplies as provided by said sections, and whether accruing or vesting, are hereby transferred to and vested in the Department of Economic and Community Affairs.

Present employees in the classified service of the state Merit System within each agency transferred in Section 41-23-1 whose job classifications are not abolished hereinafter, shall continue with the Department of Economic and Community Affairs in such functions deemed necessary to carry out the duties and responsibilities of the Department of Economic and Community Affairs. Other employees necessary to implement the duties and functions of the Department of Economic and Community Affairs may be employed subject to the provisions of the state Merit System laws and shall be entitled to the same rights and benefits thereunder. Salaries set for such employees shall not exceed the salary set by law for executive department heads.

Nothing herein shall be construed to prevent or preclude the removal of an employee in a manner provided by this article, or for cause in a manner provided by law.

All appropriations heretofore or hereafter made to: The Office of State Planning and Federal Programs, the Alabama Department of Energy, the Alabama Law Enforcement Planning Agency, the State Manpower Planning Council (CETA), the Office of Highway and Traffic Safety, and the Office of Employment and Training are hereby consolidated and transferred to the Department of Economic and Community Affairs.

(a) The Governor shall appoint a chief administrative officer to be designated as Director of the Department of Economic and Community Affairs. Such officer shall serve at the pleasure of the Governor at a salary to be set in the same manner and with the same limitations as otherwise provided by law for executive department heads. The director of the said department shall be a member of such boards, councils and commissions, as they relate to his authority under the provisions of this article, and as required and currently authorized under the various federal programs and as approved by the Governor.

(b) The Governor through the Department of Economic and Community Affairs shall encourage comprehensive and coordinated planning and programming of economic and community affairs.

(a) The Director of the Department of Economic and Community Affairs, with the approval of the Governor, may establish such division or divisions as may, in his discretion, be reasonably necessary for the administration and enforcement of any law, rule or regulation with which the department is charged or the performance of any of its functions or duties. Each division in the department shall be headed by and be under the direction, supervision and control of an officer who shall be designated as the chief of such division. All chiefs of divisions shall be appointed by the director of said department, with the approval of the Governor. Before entering upon the discharge of their duties, such chiefs of divisions shall take the constitutional oath of office. Each of such officers shall devote his full time to his official duties and shall hold no other lucrative position while serving as such. The offices or positions of director of any of the merged departments or agencies are hereby abolished.

(b) It is one of the purposes of this article to coordinate, into one department, the functions of the Office of State Planning and Federal Programs, the Alabama Department of Energy, Alabama Law Enforcement Planning Agency, the Office of Highway and Traffic Safety, and the Office of Employment and Training or any successor thereto. There is hereby established the following divisions: The Office of State Planning and Federal Programs, the Alabama Department of Energy, Alabama Law Enforcement Planning Agency, the Office of Highway and Traffic Safety, and the Office of Employment and Training. The functions of each division shall be administered by a division chief who shall be full-time and salaried as now provided by law. Each division chief shall report to and be under the supervision of the Director of the Department of Economic and Community Affairs.

The Director of the Department of Economic and Community Affairs may prescribe such reasonable rules and regulations for the conduct of its business and made in accordance with the Alabama Administrative Procedure Act.

(a) There is hereby created the Department of Economic and Community Affairs Legislative Oversight Commission to consist of the Chairman and Deputy Chairman of the Senate Committee on Finance and Taxation, three members of the Senate to be appointed by the Lieutenant Governor, the Chairman and Vice-chairman of the House Ways and Means Committee, and three members of the House of Representatives to be appointed by the Speaker of the House.

(b) The commission shall hold an organizational meeting within 30 days after this bill is enacted, and shall elect a chairman and vice-chairman from among its members. Thereafter, the commission shall meet at least two times annually, and additional meetings shall be held at the call of the chairman or upon the request of six or more members. Such meetings shall be held with the Director of the Department of Economic and Community Affairs in attendance.

(c) The commission shall adopt its own rules of procedure for the transaction of business, and a majority of the members present shall constitute a quorum for the purpose of transacting business or performing authorized duties.

(d) Each member of the commission shall be entitled to his or her regular legislative compensation and per diem and travel expenses for each day he or she attends a meeting or conducts business of the commission, and such compensation and expenses shall be paid from the funds appropriated for the use of the Legislature.

(e) The commission shall monitor and evaluate the management and operations of the Department of Economic and Community Affairs, shall recommend to the Legislature the enactment of such laws respecting the Department of Economic and Community Affairs as the commission shall deem desirable, and shall submit a written report on the operations, finances and grants made by the Department of Economic and Community Affairs during each regular session of the Alabama Legislature.

The Traffic Safety Trust Fund is established as a separate fund in the State Treasury. Upon appropriation by the Legislature, the fund shall be used for traffic safety purposes and programmed along with federal funds that are received for the same purposes by the staff of the Traffic Safety Section of the Alabama Department of Economic and Community Affairs. Unexpended or unencumbered sums remaining in the fund at the end of the fiscal year shall remain in the fund and be brought forward to the next fiscal year.

This article shall be cited as the 'Alabama Enterprise Zone Act.'

The Legislature of Alabama hereby finds and declares that the health, safety, and welfare of the people of this state are dependent upon the continued encouragement, development, growth, and expansion of the private sector within the state and that there are certain depressed areas in the state that need the particular attention of government to help attract private sector investment into these areas. Therefore, it is declared to be the purpose of this article to stimulate business and industrial growth in the depressed areas of the state, both in urban and rural areas, by the relaxation of certain governmental controls, by providing assistance to businesses and industries, and by providing state and local tax and nontax incentives in these areas.

For purposes of this article, the following terms shall have the meaning hereinafter ascribed to them, unless the context clearly indicates otherwise:

(1) COUNCIL. The Enterprise Zone Advisory Council.

(2) DEPARTMENT. The Alabama Department of Economic and Community Affairs.

(3) GOVERNING AUTHORITY. The governing body of a county or municipality.

(4) ENTERPRISE ZONE. A geographic area which is economically depressed, in need of expansion of business and industry and the creation of jobs and designated to be eligible for the benefits of this article, and is a target by governments for development by providing tax and nontax incentives to private enterprise.

(5) RURAL ENTERPRISE ZONE. An enterprise zone located in a non-MSA county, as such is defined by the United States Bureau of the Census.

(6) URBAN ENTERPRISE ZONE. An enterprise zone located in an MSA county, as such is defined by the United States Bureau of the Census.

(a) The department shall establish criteria for qualifications of enterprise zones. These criteria shall not be in conflict with any provisions of federal enterprise zone legislation that may be enacted for enterprise zones which apply for federal designation. The department shall give consideration to the following:

(1) Unemployment.

(2) Poverty rate.

(3) Per capita income.

(4) Migration.

(5) Number of residents receiving public assistance.

(b) There initially shall be 10 enterprise zones within the State of Alabama, excluding any zones established in Birmingham [pursuant to Act No. 83-142, S. 18 of the 1983 Second Special Session (Acts 1983, p. 150)] and Prichard [pursuant to Act No. 83-676, S. 506 of the 1983 Regular Session (Acts 1983, p. 1065)], and Montgomery [pursuant to Act No. 86-201, H. 538 of the 1985 Regular Session (Acts 1986, p. 264)]. Within 18 months after passage of this article, additional geographic areas shall be targeted as enterprise zones. There shall not be more than 27 enterprise zones established in Alabama.

(c) Each zone shall not exceed a maximum of 10,000 acres.

(d) Notwithstanding any provision of this section to the contrary, effective June 1, 1999, an enterprise zone shall be established in Tallapoosa County and every incorporated municipality therein.

Selection of zones and the general guidelines for implementation of the provisions of this article shall be as follows:

(1) The Alabama Department of Economic and Community Affairs shall see that all applications are processed as follows:

a. The state or any governmental entity in the proposed area may submit an application for zone designation.

b. Each application should provide a statement of incentives being offered by the governmental entities, such as:

1. Regulatory relief or waiver;

2. Services provided;

3. Tax incentives;

4. Other nontax incentives.

c. It is contemplated that state, county and/or municipal governments may devise an innovative package of local incentives in their respective jurisdictions and aggressively pursue zone designation.

(2) Zones shall be selected by the department, with input from the advisory council, which shall have the responsibility for the general implementation of the law.

(3) An Enterprise Zone Advisory Council consisting of members of the Alabama Development Office, Southern Development Council, Department of Industrial Relations, Department of Education, State Department of Transportation, Department of Environmental Management, Department of Agriculture and Industries, Department of Revenue and other qualified individuals or organizations shall be appointed by the Governor with provisions to insure geographic representation of rural and urban areas. This council shall be limited to 11 representatives and shall serve at the pleasure of the Governor.

(4) A legislative oversight committee shall be appointed by the Lieutenant Governor and the speaker. Such committee shall consist of three members from the House of Representatives and three members from the senate appointed by the respective officers of each body.

(a) Any provisions of Title 40, Chapter 18, notwithstanding, and specifically any provisions of Sections 40-18-22, 40-18-35, 40-18-35.1, 40-18-37 and 40-18-38, to the contrary notwithstanding, the following tax incentives may be available to any business, industry or manufacturer who complies with the provisions of this article:

(1) INCOME TAX CREDIT. There may be a five-year credit of varying proportions of taxes due from zone operations: first year, 80 percent; second year, 60 percent; third year, 40 percent; fourth and fifth years, 20 percent. This credit is available for corporations, partnerships, and proprietorships provided that 30 percent of the new permanent employees were formerly unemployed for at least 90 days prior to this employment.

(2) CREDIT FOR EXPENSES OF TRAINING NEW EMPLOYEES. There may be a tax credit for the expenses of training new employees in new skills. The maximum credit shall be 1,000.00 per employee.

(3) CREDIT FOR NEW INVESTMENTS. There may be a credit for new investments within the state in the following amounts: 10 percent on first $10,000.00 invested, five percent on next $90,000.00 invested, and two percent on remaining investment. This credit is also available for improvements to existing facilities, provided at least five new permanent employees are hired.

(4) LOCAL TAXES. A reduction of permit fees, user fees and business, professional and occupational license taxes may be permitted by the local governments. This incentive is optional and shall be stated when the area applies for zone designation.

(b) The Commissioner of the Department of Revenue shall formulate, promulgate, issue and enforce any reasonable and necessary rules to implement any state tax credits or incentives.

(c) It is expressly provided that any tax credit, pursuant to this section, shall not total in excess of $2,500.00 per new permanent employee hired pursuant to this article. This tax credit may be applied in all enterprise zones to any state income tax liability or any state business privilege tax liability and shall be used for the taxable year in which the increase in average annual employment occurred to the maximum allowed. However, if the entire credit cannot be used in the year earned, the remainder may be applied against the income tax or state business privilege tax for the succeeding two years or until the entire credit is used, whichever occurs first.

(d) All tax credits herein prescribed may be in addition to any exemptions and credits authorized in Title 40, Chapter 18.

(e) No tax credits for tax incentives shall be authorized for any credit for taxes, fees or funds to other states or territories.

Nontax incentives shall include:

(1) REGULATION EXEMPTIONS. The local governments may exempt regulations to the extent they propose in the application for designation; however, no such exemption can adversely affect the health and welfare of the citizens of the state. Such exemption shall be by resolution or ordinance.

(2) EMPLOYEE TRAINING AND TECHNICAL ASSISTANCE.

a. Employee training may be made available to zone business through the department.

b. Technical assistance in business start-ups. A business starting up in the enterprise zone may be afforded technical assistance such as accounting, planning, etc., through a public university or state junior college in the area, which has agreed to accept such responsibility. Assistance may be provided by the small business development centers, technical assistance centers and others.

(3) INCREASED OR SPECIALIZED SERVICES PROVIDED BY LOCAL GOVERNMENTS. The local governments would state in the application for designation such increased services it would provide, such as fire protection, police protection and utility services. All services are at local option.

Additional requirements for a business, partnership, corporation or individual to receive benefits shall include:

(1) The business must expand its labor force or make new capital investments or prevent a loss of employment to an existing business.

(2) A business may not have closed or reduced employment elsewhere in Alabama in order to expand into the zone.

The department shall report annually to the Legislature and the Governor, and provide a thorough evaluation of the implementation of the zone law, including: numbers of business activity; actual new income for the state after taxes and benefits pursuant to this article; number of new employees; cost to state for each new employee; and state and local taxes generated.

The department shall designate qualified enterprise zones only after receiving notice from the appropriate governing authority that it additionally agrees to:

(1) Devise and implement a program to improve police protection within the zone.

(2) Give priority to the use in the zone of any UDAG, CDBG, JTPA, industrial bonds, or other funds received from the appropriate agencies of the federal government.

(3) Assist the department in certifying employers to be eligible for said benefits.

(4) Authorize the department to supersede certain specified local regulations and ordinances which may serve to discourage economic development within the enterprise zone.

(5) Assist the department in evaluating progress made in any enterprise zone within its jurisdiction.

The department shall administer the provisions of this article and shall have the following powers and duties in addition to those mentioned elsewhere in this article and in other laws of this state:

(1) To monitor the implementation and operation of this article and conduct a continuing evaluation of the progress made in the enterprise zones.

(2) To assist the governing authority of an enterprise zone in obtaining assistance from the federal government, including the possible suspension of federal regulations within the enterprise zone.

(3) To assist the governing authority of an enterprise zone in obtaining assistance from any other department of state government, including assistance in providing training, technical assistance, and wage subsidies to new businesses and small businesses within an enterprise zone.

(4) To assist any employer or prospective employer within an enterprise zone in obtaining the benefits of any incentive or inducement program authorized by Alabama law.

(5) To submit an annual written report evaluating the effectiveness of the program and any suggestions for legislation to the Governor and the Legislature no later than the third day of each regular session.

(6) To promulgate rules and regulations to effectuate this article, in accordance with the Administrative Procedure Act.

(7) To notify each legislator whose district includes any portion of an enterprise zone when the department designates such a zone.

(a) The department, after consultation with the council, and with the approval of the Governor, may enter into contracts with eligible businesses to provide:

(1) For the exemption from sales and use tax imposed by the State of Alabama or from sales and use tax imposed by its political subdivisions, upon approval of the governing authority thereof, of the purchases of the material used in the construction of a building, or any addition or improvement thereon, for housing any legitimate zone business enterprise, and machinery and equipment used in that enterprise.

(2) For certain exemptions from income taxes levied by the State of Alabama levied on eligible corporations and individuals for a period of five years.

(3) For certain exemptions of business privilege taxes levied by the State of Alabama for a period of five years.

(4) For certain exemptions from utility gross receipts taxes levied by Article 3, Chapter 21, Title 40, and utility gross receipts service taxes levied by Article 4, Chapter 21, Title 40, within the enterprise zone, for a period of up to 20 years, for eligible businesses which meet the conditions of subdivision (4) of subsection (c).

(5) For certain exemptions from sales and use taxes imposed by the State of Alabama or from sales and use taxes imposed by local governmental entities, upon approval of the governing authority thereof, within the enterprise zone, for a period of up to 20 years, for eligible businesses which meet the conditions of subdivision (4) of subsection (c).

(6) For certain exemptions from income taxes levied by the State of Alabama levied on eligible corporations and individuals, from income arising from enterprise zone operations, for a period of up to 20 years, for eligible businesses which meet the conditions of subdivision (4) of subsection (c).

(b) The exemptions provided for in subdivisions (4), (5), and (6) of subsection (a) shall not be available to any eligible business after June 30, 1996. Notwithstanding the foregoing, any eligible business receiving the exemptions provided for in subdivisions (4), (5), (6) of subsection (a) before June 30, 1996, shall continue to receive those exemptions for the period of time specified in those subdivisions.

(c) The department may enter into the contracts provided in subsection (a) of this section provided that:

(1) The business and its contractors give preference and priority to Alabama manufacturers and, in the absence of Alabama manufacturers, to Alabama suppliers, contractors, and labor, except where not reasonably possible to do so without added expense, substantial inconvenience, or sacrifice in operational efficiency.

(2) The request for such exemption is accompanied by an endorsement resolution approved by the appropriate local governing body, port district, or industrial development board in whose jurisdiction the establishment is to be located.

(3) The business is or shall be located within the boundaries of an urban or rural enterprise zone.

(4) The provisions of subdivisions (4), (5), and (6) of subsection (a) shall be applicable only for businesses which employ at least 1,200 people and make capital investments and capital improvements of at least seventy-five million dollars ($75,000,000) within the enterprise zone.

(5) For businesses which meet the conditions of subdivision (4) above, amounts equivalent to all tax exemptions granted in subsection (a) above shall be utilized by the business solely and exclusively to pay for the new capital investments and improvements within the enterprise zone. These amounts will be maintained by the business in a special account for this purpose and will be subject to verification by the department.

(6) The business located in an urban or rural enterprise zone and receiving the benefits of this article certifies that at least 35 percent of its employees:

a. Are residents of the urban enterprise zone hosting the location of the business at the time of their employment; or are residents of the same county in which a rural enterprise zone is located; and

b. Were receiving some form of public assistance prior to employment; or

c. Were considered unemployable by traditional standards, or lacking in basic skills; or

d. Any combination of the above.

Certification shall be updated annually in order for the business to continue receiving the benefits pursuant to this article.

(d) The department, in cooperation with the council, may enter into agreements with employers located in either urban or rural enterprise zones under which the employers may receive wage subsidies payable from the United States Department of Labor JTPA manpower block grant funds, to the extent that these funds are granted to the State of Alabama by the United States Department of Labor.

(e) All provisions of Title 40 for the enforcement and collection of the taxes herein levied, not specifically addressed in this section, are applicable.

The Directors of the Alabama Department of Economic and Community Affairs, Alabama Development Office, Department of Education, the Department of Industrial Relations and the Commissioner of the Department of Revenue shall be authorized to formulate reasonable rules and regulations necessary to implement the provisions of this article and shall cooperate with each other in the implementation of this article.

The provisions of this article shall be complementary to and consistent with federal tax exemptions and be superseded when necessary by the passage of federal enterprise zone legislation.

There is hereby appropriated from the State General Fund to the Alabama Department of Economic and Community Affairs for the 1990-91 fiscal year the sum of $500,000 to be used to create and establish throughout this state several economic development revolving loan funds from which the several existing regional planning and development commissions, as defined in Articles 4 and 5 of Chapter 85 of Title 11, may disperse moneys, from time to time, to finance local economic development projects. These funds shall be distributed by the Department of Economic and Community Affairs to qualifying regional planning commissions for disbursement. The Department of Economic and Community Affairs shall establish such policies and procedures as may be deemed necessary as to insure accountability of funds in relation to state statutes and federal programs to which these funds may be pledged as required match. Such policies and procedures will be reviewed and approved or disapproved by the Regional Revolving Loan Policy Committee herein established by this article. Moneys borrowed from such revolving loan funds may be combined with or used to facilitate access to either federal funds or foundation grants or loans or to leverage private sector financing that may be available for initial or 'seed' capital, long or short term fixed asset or equipment loans or working capital for local economic development projects for improving, developing, or financing new, existing, or expanding business or industry to preserve or create employment. Such borrowed moneys shall be loaned and repaid under such rules, regulations, and conditions as prescribed by Alabama Department of Economic and Community Affairs and approved, from time to time, by the Regional Revolving Loan Policy Committee provided for in Section 41-23-51. Principal and interest payments to the economic development revolving loan funds shall be retained by the respective economic development revolving loan funds for local economic development. Reasonable administrative costs for servicing such loans and for the administration of the respective economic development revolving loan funds may be paid from fees, charges and interest on the loans and from available balances.

The moneys appropriated to the Alabama Department of Economic and Community Affairs under the provisions of Section 41-23-50 shall be used to create and establish economic development revolving loan funds throughout this state, pursuant to rules hereunder and approved by the Regional Revolving Loan Policy Committee. This committee shall be established for purposes of reviewing and approving policies and procedures, and to provide general oversight for this program. This committee shall be composed of the following members: the Director of the Alabama Department of Economic and Community Affairs, the Director of the Alabama Development Office, two members of the Senate appointed by the Lieutenant Governor, the Chairperson of the Senate Economic Affairs Committee, two members of the House appointed by the Speaker of the House, the Chairperson of the House Commerce and Industrial Development Committee, and four members appointed by the Governor. The executive directors from the regional planning commissions shall serve as ex officio, nonvoting members of the Regional Revolving Loan Policy Committee. The terms of the legislative members and the Alabama Development Office Director and the Alabama Department of Economic and Community Affairs Director shall run concurrent with the four-year term of the Governor. The initial members appointed by the Governor shall serve staggered terms of one, two, three, and four years. The length of the terms for the Governor's appointees, except for the original appointees, shall be four years. Vacancies shall be filled by the same method of appointment. The Director of the Alabama Department of Economic and Community Affairs shall call an organizational meeting for such committee no later than 30 days after April 25, 1990. At such meeting, such committee shall select from its membership a chairperson and a vice-chairperson. Thereafter, such committee shall likewise reorganize itself at its first meeting of each new legislative quadrennium. Such committee shall meet at least four times per year on call of its chairperson. All members of the Regional Revolving Loan Policy Committee shall serve without compensation except legislative members who shall be entitled to their regular legislative compensation for attendance in committee meetings. The Alabama Department of Economic and Community Affairs shall promulgate and implement administrative rules, regulations, and procedures for the allocation of the appropriated General Fund moneys.

This article will be known as the 'Alabama Small Business Incubator Act of 1994.'

As used in this article, the following words and phrases shall have the following meanings:

(1) ADVISORY COUNCIL. A subcommittee of the committee.

(2) BASE FUNDS. Any money not appropriated pursuant to this article, that is used to match the state funds. Base funds may be federal, local, private, foundation grants, or money derived from any other source.

(3) COMMITTEE. The Regional Revolving Loan Policy Committee established by Section 41-23-51.

(4) CONTRACTUAL SERVICES. Any services necessary for the implementation of and the administration of this article.

(5) DEPARTMENT. The Alabama Department of Economic and Community Affairs.

(6) INCUBATOR. A multitenanted facility characterized by shared business services, equipment, space, and access to on-premises business consultants.

(7) LEGAL ENTITY. Any authority, agency, regional planning and development commission, city government, county government, or subdivisions thereof to which the state may grant funds.

(8) SPONSOR. Any entity that qualifies to make application for state funds and that enters into a written agreement with the committee to establish, operate, and administer a small business incubator or to provide funding to an organization that operates as a small business incubator.

(9) STATE FUNDS. The allocation of moneys from the State General Fund to the department for the purposes of this article.

(10) TENANT. A sole proprietorship, partnership, or corporation that operates in a small business incubator.

The committee is responsible for the implementation of this article, including, but not limited to:

(1) Assessing the current status of small business incubators in Alabama.

(2) Establishing criteria for the awarding of any grants.

(3) Reviewing and approving applications for grants.

(4) Creating an advisory council of knowledgeable entrepreneurial developers to assist the committee in establishing any policies and procedures pursuant to this article.

The department shall establish policies and procedures necessary to insure accountability of funds relative to state statutes and federal programs to which the funds may be pledged as a required match. The policies and procedures shall be reviewed and shall be approved or disapproved by the committee. The department shall promulgate and implement administrative rules, regulations, and procedures for the allocation of the appropriated General Fund moneys.

The following grant programs shall be established:

(1) FEASIBILITY STUDY MATCHING GRANTS. As a necessary step in incubator start-ups, funds may be provided on a 50 percent state to 50 percent sponsor basis. Any feasibility study shall conform to the format established by the National Business Incubator Association. The maximum state funds for this purpose shall be $10,000.

(2) TECHNICAL ASSISTANCE GRANTS. Funds may be provided as deemed necessary by the committee.

(3) CAPITAL OUTLAY AND OPERATIONAL MATCHING GRANTS. To offset operation costs related to beginning and maintaining a small business incubator for the first two years of operation. The maximum state funds for the first year shall be 50 percent of operational costs not to exceed $75,000, and the second year shall be limited to 50 percent of that amount.

(4) START-UPS OR EXPANSION GRANTS. Grants to provide for the renovation of start-ups or expansions of space in buildings or other buildings determined to be suitable for small business incubation purposes. The maximum participation for state funds for this purpose is 30 percent of the project amount, not to exceed $200,000 per grant.

(5) CONSTRUCTION GRANTS. Grants to provide for the construction of new facilities. The maximum participation for state funds for this purpose is 30 percent of the project amount, not to exceed $200,000 per grant.

The committee may use funds for the purpose of implementing and administering this article.

Legislative members of the committee may receive their regular legislative compensation for attendance of committee meetings. Other committee members shall be entitled to per diem and mileage allowances in the same amount as state employees receive as per diem and mileage allowance.

If state grant funds are not utilized for the purposes stated in the approved grant application within two years of the date of the grant award, then the disbursed grant funds shall revert to loans. Repayment of these funds shall be made in yearly principal and interest installments for five years at the New York prime rate at the time of notification by the department that the two year limit has expired. These loans may be repaid on a shorter schedule if the grantee so desires. Loan funds recouped by the department and grant funds obligated, but not disbursed, shall become available for other purposes pursuant to this article.

The Legislature finds that the development, management, efficient consumption, and conservation of residential energy resources are of prime importance throughout this state and this nation. It is also important to ensure the protection of the economic and environmental values of Alabama's citizens. It is the intent of the Legislature to do each of the following pursuant to this article:

(1) Encourage the conservation and efficient use of residential energy resources within this state's counties and municipalities.

(2) Provide a governmental environment that will encourage and promote an initiative for the acceptance, adoption, and implementation of the Model Energy Code by the units of local government.

(3) Advise and assist the units of local government in adopting the Model Energy Code and implementing those code provisions within their boundaries.

(4) Promote the identification of energy management technologies available for residential uses, and to disseminate information to the units of local government about such technologies and their uses.

(5) Promote the acceptance and adoption of those energy management technologies for use in all energy-consuming residential facilities throughout this state.

The following terms shall have the meanings respectively prescribed for them, except when the context otherwise requires:

(1) BOARD. The Alabama Residential Energy Code Board created by this article.

(2) DEPARTMENT. The Alabama Department of Economic and Community Affairs.

(3) DIVISION. The Science, Technology, and Energy Division of the Alabama Department of Economic and Community Affairs.

(4) MODEL ENERGY CODE. The 1993 Edition of the Model Energy Code as prepared and maintained by the Council of American Building Officials, or any subsequent editions, changes, or recompilations thereof, or any other energy code, which the board has officially adopted.

(5) UNIT OF LOCAL GOVERNMENT. Any county or municipality within the State of Alabama.

(a) The Alabama Residential Energy Code Board is established.

(b) The board shall consist of 13 members appointed by the Governor. The 13 members shall be citizens of the state, and shall be selected on the basis of their representation of the following organizations, industries, entities, and professions:

(1) One member shall represent the Home Builders Association.

(2) One member shall represent the Board of General Contractors.

(3) One member shall represent the Heating and Air Conditioning Board.

(4) One member shall represent the private, investor-owned, electric utility industry.

(5) One member shall represent the rural electric cooperative industry.

(6) One member shall represent the natural gas industry.

(7) One member shall be a licensed professional engineer.

(8) One member shall represent municipalities.

(9) One member shall represent county governments.

(10) One member shall represent the Alabama Council, American Institute of Architects.

(11) One member shall represent the Alabama Liquefied Petroleum Gas Board.

(12) One member shall represent the Southern Building Code Congress International (SBCCI).

(13) One member shall represent the Home Builders Licensure Board.

(c) Each member shall be selected from a list of three candidates provided to the Governor by the division. Board appointees shall be selected on the basis of their interest in problems concerning residential energy resources, consumption, and conservation, and without regard to political affiliation. Appointments shall be of such a nature as to aid the work of the board and to inspire the highest degree of coordination and cooperation. All members of the board shall be deemed members at-large charged with the responsibility of serving the best interests of the board, the division, the units of local government, and the state. No member shall act as the representative of any particular region, United States congressional district in Alabama, or state Senate or legislative district in Alabama.

(d) The board shall serve in an advisory capacity to the division, and to units of local government, with respect to all matters pertaining to the acceptance, adoption, and implementation of the Model Energy Code. The board shall be under the authority and supervision of the division, and shall be administered by the chief of the division with the assistance of such other officers and department employees as are deemed necessary to carry out the purpose, functions, duties, and activities of the board.

(a) Each member of the board shall be selected for a five-year term, the term to begin on the date of appointment of each member. Of the initial appointees, however, the terms of membership shall be as follows:

(1) Four members shall be appointed to serve for two years.

(2) Three members shall be appointed to serve for three years.

(3) Three members shall be appointed to serve for four years.

(4) Three members shall be appointed to serve for five years.

(b) The members of the board shall continue to serve after the expiration of their terms until their successors have been appointed by the Governor. Any member may be reappointed to serve on the board; however, no member shall serve for more than a total of 10 years on the board from the date of initial appointment.

(c) Vacancies on the board shall be filled by appointment by the Governor for the unexpired term.

(d) The members of the board shall receive no salary or compensation for serving on the board but shall be reimbursed for travel expenses in accordance with State of Alabama law, incurred in the performance of their duties.

(a) The first meeting of the board shall be called by the chief of the division as soon as is practicable after July 31, 1995. The division chief shall preside until a chair and a vice chair are selected by the board. The board shall elect annually from its own members a chair, a vice chair, and such other officers as it may deem desirable, and shall adopt rules for its organization in the conduct of its business.

(b) The board shall hold a regular meeting at least once during each calendar year at a time and place as designated or specified in its rules. Special or additional meetings may be held on a call of the chair, upon a call signed by at least seven members, or upon a call by the division chief.

(c) A majority of the members of the board shall constitute a quorum at all its meetings, and adoption or resolution of any business shall require the concurrence of a majority of all the members of the board. An agenda for the meetings in sufficient detail to indicate the terms on which final action is contemplated shall be mailed by the division chief to the chair, vice chair, and board members at least 30 days prior to the meeting.

(d) The division chief shall serve as ex officio secretary of the board, shall keep a record of the proceedings of all board meetings, and perform such other duties as may be delegated by the board. The division chief shall not receive any additional compensation for the performance of those duties on the board or pursuant to this article.

(e) The board may establish committees among its membership, as it deems necessary, to assist in the conduct of its business. Subcommittees shall include representation from suppliers.

(a) The board shall serve in an advisory capacity to the division with respect to all matters pertaining to the acceptance, adoption, and implementation of the Model Energy Code. In so doing, the board may perform any of the following functions:

(1) Review, make recommendations, and determine whether the most current edition of the Model Energy Code should be adopted by the units of local government.

(2) Evaluate, assess, advise, and counsel the division and the units of local government, on residential energy codes and the impact of those codes upon the economy and the environment.

(3) Solicit and enlist the cooperation of all appropriate private-sector and community-based organizations to implement the purpose of this article.

(4) Make recommendations to the division for the enactment of additional legislation as it deems necessary which proposes to further enhance the capabilities of the state and the units of local government in accepting, adopting, and implementing the Model Energy Code, and in meeting the need for increasing residential energy resources and conservation due to trends in residential population and the change in technical requirements of the economy.

(5) Make continuing studies, on its own initiative or upon the request of the division, of the residential energy resources, conservation, and consumption needs throughout the state, and issue those reports to the division and to the units of local government as may result from its studies.

(6) Submit to the chief of the division, on an annual basis, a written report covering the activities of the board.

(7) Make rules and regulations for the conduct of its board meetings, procedures, and execution of the purpose, functions, powers, and duties delegated to it by this article.

(8) Conduct a program of public information in order to inform the units of local government and the citizens of the state on matters of importance to residential energy resources, conservation, and consumption.

(9) Identify any and all resources needed or required for the board to implement the purpose, functions, powers, and duties of this article.

(b) The division shall be responsible for considering and taking action upon any and all recommendations to which the board may from time to time submit.

(a) The Neighbors Helping Neighbors Fund is established in the State Treasury to provide eligible recipients weatherization assistance.

(b) The monies in the fund shall consist of any of the following:

(1) Contributions from taxpayers received by the Department of Revenue and transferred to the fund.

(2) Appropriations from the Legislature.

(3) Donations from private sources.

(4) Interest earned on principal remaining in the fund.

(c) The monies in the fund shall not revert to the General Fund at the end of the fiscal year.

(a) Eligible recipients of assistance are individuals who have a household income at or below 125 percent of the poverty level or individuals who are 60 years of age or older or handicapped and families with children under 18 years of age as determined by the United States Office of Management and Budget and reported in the federal register.

(b) Beginning July 1, 1996, the Director of the Department of Economic and Community Affairs shall provide assistance funds to designated community action agencies and county governments currently providing energy assistance to people who are eligible to receive assistance under this article. Disbursement of assistance funds shall be coordinated with all other state and federal home weatherization assistance programs administered by the Department of Economic and Community Affairs.

(c) An amount of not more than 10 percent of the fund monies may be used for administrative costs in providing services specified under this article.

(d) On or before October 15 of each year, the director shall submit a report to the appropriate legislative committees. The report shall include a summary of the total monies collected and distributed under this article and such other information as the legislative committees may request.

(a) The Department of Revenue shall provide a space on the individual tax return form in which the taxpayer may designate an amount of the taxpayer's refund as a voluntary contribution to the Neighbors Helping Neighbors Fund.

(b) The Department of Revenue shall subtract the designated amount from the refund due the taxpayer and pay it to the State Treasurer for deposit in the fund.

(c) The taxpayer may also donate an amount to the fund, in lieu of or in addition to the designated portion of his or her income tax refund, by an appropriate indication and by including the amount on his or her return.