2026-09-10 · Alabama · Legislation

Alabama has created a new kind of nonprofit association designed to be governed by software. The reason it belongs in a community-association column is not the software — it is which chapter of the Code the Legislature put it in.

SB 277 became Act 2026-325, signed on April 1, 2026 and effective October 1, 2026.¹ It passed the Senate 32–1 and the House 93–0, sponsored by Senator Lance Bell.

What it creates

The act adds a new Article 2 to Chapter 17 of Title 10A — twenty-eight new sections, §§ 10A-17-2.01 through 10A-17-2.28 — establishing the decentralized unincorporated nonprofit association as an entity form.

Such an association has separate legal existence, capacity to acquire and convey property, to sue and be sued, to contract and to be served. Its internal governance may use distributed ledger technology and algorithmic means to validate records and make organisational decisions. The act provides for member liability limits, administrators, indemnification, insurance, recordkeeping, dissolution, winding-up and mergers, and permits profit-making activity so long as profits further or are set aside for the association's common purpose.

The part that touches existing associations

Chapter 17 of Title 10A is the Alabama Unincorporated Nonprofit Association Act — the default governing law for a neighbourhood association that never filed a certificate of incorporation.

To make room for the new material, the act designates the existing §§ 10A-17-1.01 through -1.18 as Article 1. In the same session, Act 2026-495 separately amended § 10A-17-1.02.

So the chapter that catches unincorporated Alabama associations was both reorganised and amended in a single session, by two different acts.

1. SB 277, 2026 Regular Session — enrolled text (Act 2026-325), Alabama Legislature ↩
2. Act 2026-325 — act detail, Alabama Secretary of State ↩
3. HB 248, 2026 Regular Session — enrolled text (Act 2026-495), also amending § 10A-17-1.02 ↩