USA – ALABAMA Law and Practice Contributed by: Adam J. Sigman, Crystal H. Walls, Nathan Stotser, Katie Sinclair and Courtney Bradshaw, Dentons
documents and subsequent foreclosure of the secured collateral. In the commercial context, and depending on the commercial loan and property’s size and characteristics, a borrow - er’s insolvency might lead to a receiver being appointed under Alabama law; see Section 6-6- 620 to -628 and See Ala. Code Section 6-6-780 to 6-6-807 (the Alabama Uniform Commercial Real Estate Receivership Act). 3.10 Taxes on Loans There are no taxes related to mezzanine loans besides taxes due on interest and income there - from. 4. Planning and Zoning 4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning Alabama law (Title 11, Counties and Municipal Corporations) allows for regulations on property through zoning ordinances or subdivision regu - lation. See 4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction . The property owner/developer should research any applicable planning and zoning regulations to the property by ordering a zoning report and communicating directly with the appropriate municipality(ies). In addition, the Alabama business licence fee can vary depending on the location of the property and the use. See 8.3 Municipal Taxes . 4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction Local municipal corporations (cities and towns) may enact zoning laws and regulations through the creation of a comprehensive zoning ordi - nance, which must be compatible with the ena -
bling statute (Section 11-52-1 et seq). Zoning laws generally designate areas into business, industrial and residential districts, and control the type, character, kind and use of structures and improvements in such designated zones or districts (Section 11-52-70). County govern - ments may also enact zoning ordinances and building codes for flood-prone areas outside municipalities (Section 11-19-3). Private restrictive covenants in the property’s chain of title may also create similar controls on the development of property or refurbishment of an existing building. 4.3 Regulatory Authorities Local zoning laws are passed by the local municipal planning commission and must be consistent with the local comprehensive plan, in accordance with Section 11-52-3. Zoning laws typically control: • the permitted shape, proportion and dimen - sions of lots and structures located thereon; • the use of such structures; • setback requirements; and • the use of parcels in designated zones or areas. For certain redevelopments, the Alabama Department of Environmental Management may have recorded restrictions on use, development, etc, into the chain of title of a property. 4.4 Obtaining Entitlements to Develop a New Project Developers typically begin by engaging consult - ants, such as architects and civil engineers, and by contacting the local planning department for guidance on the permitting process. Developers should review the applicable zoning laws and obtain approval from the local zoning official/
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