The "Rural Hospital Investment Act of 2025" seeks to improve the financial stability of rural hospitals in Alabama by creating the Rural Hospital Investment Program, which will be overseen by a newly established board comprising state officials and representatives from relevant organizations. The act introduces tax credits for state income, excise, premium, and utility taxes in exchange for donations to eligible rural hospitals, thereby encouraging financial contributions to these healthcare facilities. To qualify, hospitals must be licensed, serve Medicare and Medicaid patients, and provide care to indigent individuals, while also submitting a five-year financial plan detailing their use of donations.

The bill establishes specific tax credit limits based on taxpayer status, with individual credits capped at $15,000 for single filers and $30,000 for joint filers, while corporations can claim up to $500,000. It also includes a utility tax credit for qualified donations, with a total statewide cap of $20 million for 2026, increasing to $30 million in subsequent years. The act mandates that the Department of Revenue adopt rules for administering these credits by January 1, 2026, and allows unused credits to be carried forward for three years. Importantly, the act ensures that these tax credits do not affect funding for the Alabama Special Mental Health Fund, and it will take effect immediately upon passage.