The 2023 fiscal year State General Fund budget (SGF) will be considered in the Senate Finance and Taxation Committee on Wednesday at 11 a.m.

Senate Bill 106 (SB106) is sponsored by State Sen. Greg Albritton (R-Atmore), who chairs the committee.

The 2023 fiscal year budget begins on Oct. 1. Alabama has an archaic budgeting system where over 90% of funds are earmarked. The SGF deals with non-educational government programs including the Department of Corrections, the Alabama Law Enforcement Agency, the Examiner of Public Accounts, the court system, Alabama Medicaid, the Alabama Department of Public Health, the Department of Mental Health, the Department of Human Resources, the Bureau of Pardons and Paroles, and dozens of other non-education state agencies. Educational dollars, which includes 100% of the state income tax, are appropriated by the Educational Trust Fund budget (ETF).

This is the largest SGF budget in state history at $2,645,040,061.

The state of Alabama is entering 2023 with an anticipated $112,483,844 surplus from the current FY2022 budget. This will be the beginning balance in the State General Fund for fiscal year 2023. If there are any unanticipated and unappropriated dollars above that planned surplus amount, the first $40,000,000 will be appropriated to the Department of Corrections - Correctional Capital Improvement Fund. The next $10,000,000 of the unanticipated beginning balance would be transferred to the Correctional Facilities Maintenance Fund. The state of Alabama is in the process of building two new mega prisons – the cost of which is being heavily impacted by inflation, particularly in construction.

This budget appropriates up to $28,000,000 to pay for an election year 4% salary increase for non-education state employees. It also appropriates up to $3,000,000 to pay for a one-time election year bonus for the state retirees. This is a one-time bonus and not a cost of living adjustment (COLA) which would apply to future years. Alabama has a defined benefit plan with no plan or funding for a COLA.

The budget includes a conditional appropriation of $40,000,000 to the Department of Corrections to have additional correctional officers. This budget appropriates $930 per month for health insurance for each full-time state employee.

There is a conditional appropriation of $3,500,000 to the State Port Authority.

This SGF budget includes transfers of $27,505,000 from state agencies. Some $16,505,000 is from the Department of Revenue, $10,000,000 is from the Public Service Commission and $1,000,000 is from the Securities Commission.

Any state agencies which had funds left over from the 2022 budget will get to keep those unexpended funds for FY 2023.

The total state general fund budget is $2,645,040,061. The Committee is expecting other state, federal and local funds of $17,520,887,271 for a total anticipated appropriation of $20,165,927,332. State budgets are heavily dependent on receiving federal funds.

If the committee gives a favorable report to SB106 it could be considered by the full Senate as early as Thursday. Preparing the two budgets is the primary constitutional purpose of the regular legislative session.

To read the full 121-page bill:

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