Ala. Code § 9-14A-23: Tax Exemption.

The corporations on behalf of the state shall have the power to provide for such payments to the United States of America as the directors deem necessary to cause the interest on any bonds to be and remain exempt from federal income taxation. The corporations shall have the power to make agreements respecting the investment of the proceeds of the bonds or other funds of the corporation necessary in order that the interest income on bonds of the corporations be and remain exempt from federal income taxation.