AL SB265

Limits the maximum tax abatement period for data processing centers to 20 years for abatements granted on or after January 1, 2027, eliminating the previous 30-year option for centers exceeding $400 million in capital investment.

Requires large data processing centers with 100+ megawatt peak demand to pay state noneducational ad valorem taxes and state sales/use taxes on building materials, fixtures, structural components, power infrastructure, backup generators, and battery systems beginning January 1, 2027.

Allows the Governor to waive the new state construction tax limitations for data processing centers located in "targeted counties" as defined in existing economic development law.

Extends the sunset date for data processing center tax incentives under Act 2012-210 from July 31, 2028 to July 31, 2032.

Exempts projects in Class 3 municipalities that were executed before the effective date or expanded within 10 years after the effective date from the new limitations; bill becomes effective June 1, 2026.