Senate committee advances bill to expand utility relocation reimbursements with limits and reporting

A Senate committee on Wednesday advanced House Bill 542 after a public hearing that featured industry support and caution from the Alabama Department of Transportation. The legislation removes a $250 million gross-income cutoff that previously made larger utilities ineligible for state reimbursement when road projects require them to relocate lines, while adding limits and a reporting requirement.

The bill’s sponsor told the committee the change is intended to create fairness and predictability when government road projects impose relocation costs on utilities. The sponsor said the bill would allow utilities with more than $250 million in gross annual income to be eligible for reimbursements but would cap total annual reimbursements to those large utilities at $10 million and limit individual project payments to $500,000. The sponsor also said the legislation would require ALDOT to spend no less than $20 million annually on reimbursements for utilities with less than $250 million in gross annual income and would not take effect until Oct. 1, 2027. The bill additionally requires ALDOT to begin collecting and reporting line-relocation project data starting Oct. 1 of this year.

“The state providing reimbursement for one utility and not another creates a competitive imbalance,” Taylor Vice, senior director of government affairs for Charter Spectrum and president of the Alabama Cable and Broadband Association, told the committee. Vice said Spectrum spent $275 million on capital expenditures and $100 million on salaries in 2025 and argued HB 542 protects continued broadband investment.

Tony Harris of ALDOT urged caution. He told members that funding the $10 million cap for large utilities would likely come from existing programs—“the most likely immediate place to be reduced would be the ATRIP 2 program,” created under the Rebuild Alabama Act—and recommended further study or referral to the joint transportation commission. Harris also noted that the bill’s $20 million minimum for smaller utilities may not be reachable in years when ALDOT does less capacity work.

Committee members debated the fiscal impact. A senator warned that the measure would redirect taxpayer dollars into the hands of large private utilities; the sponsor and others countered that using the five-year ALDOT average (about $21.86 million) as a baseline would limit net new exposure and that ALDOT retains discretion over which projects to reimburse. The sponsor told the panel ALDOT had reimbursed 225 projects totaling about $109.3 million over the last five years and that 365 projects in that window were not reimbursed, figures offered as context for the proposed caps.

An amendment clarifying that projects using state funds remain eligible and that private right-of-way processes are preserved was adopted before the committee vote. After a roll-call vote the chair declared the bill passed out of committee; the transcript records at least one recorded dissent and multiple aye responses but does not include a complete numerical tally.

The bill moves from committee to the next legislative stage; implementation of the reimbursement changes would begin Oct. 1, 2027, and ALDOT must start reporting on line-relocation projects beginning Oct. 1 of this year, under the measure adopted by the committee.