More than 100 Alabama cities will soon stop collecting taxes from police jurisdictions outside city limits

BIRMINGHAM, Ala. (WBRC) - More than 100 Alabama cities will soon have to stop collecting taxes in the police jurisdictions just outside of their city limits.

It’s because the cities did not comply with a 2021 law that requires them to share with the state how much tax they collected and where those taxes went.

That law states that if towns and cities did not share their police jurisdiction tax information with the state, then they can no longer collect taxes and fees in the police jurisdiction just outside their corporate limit. According to The Alabama Daily News, that’s 128 Alabama cities.

Editor Todd Stacy said under the law, those cities can’t ever collect taxes and fees for the police jurisdiction outside of their city limits. The law was designed to prevent officials from spending tax dollars collected outside their limits, inside the city. It provided towns 12 months to send in their numbers.

Stacy said some cities chose not to file a report, because the money they were brining in wasn’t large enough. Stacey said other city leaders said they didn’t know.

“Some are saying ‘we didn’t know this was happening, how can we comply’,” Stacy said. “If they did not comply with this law and report this data to the state, there’s no second chance. There is no ‘well we can do this over and start again next year and then again be able to collect those taxes and fees’, you’re done.”

It’s unclear exactly how much money these cities and towns could lose. It is also unclear if they will continue to patrol the areas outside their city limits without tax money.

WBRC reached out to the Alabama Department of Revenue and in a statement, they said:

WBRC reached out to The Alabama League of Municipalities and in a statement, they said:

WBRC also spoke with the city of Irondale. It was the only city in Jefferson County that did not comply, according to Alabama Daily News’ list.

Irondale Mayor James Stewart said they currently don’t collect any taxes in the police jurisdictions around their boundaries, so that is why they did not file a report. He said they are working with the Department of Revenue, but their records show no funds in police jurisdictions.

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