Bill > HB404

This bill, known as the Alabama Community Land Trust Act of 2026, authorizes Class 1 municipalities (the largest cities in Alabama) to establish community land trusts, which are nonprofit organizations designed to promote long-term affordable housing for low-income and moderate-income families through ground leases. A ground lease is an agreement where the community land trust owns the land, and a tenant leases it to build or occupy a home, ensuring the property remains affordable. The bill defines "affordable housing" broadly to include units meeting various federal and state affordability criteria, such as those receiving Low Income Housing Tax Credits (LIHTC) or Project-Based Section 8 assistance. It outlines the structure and governance of these trusts, requiring a board of directors with specific expertise and prohibiting elected officials from serving. The community land trusts are granted powers to acquire property, lease affordable housing, enter into ground leases, and accept funding, with provisions for transparency and annual audits. The bill also establishes a preemptive purchase option for the community land trust and the organizing municipality to buy back improvements on the land to maintain affordability, and it provides tax exemptions for property owned by these trusts under certain conditions.