On Tuesday, the Alabama House of Representatives passed an $8.1 billion Education Trust Fund (ETF) budget – the largest in the history of the state.
House Bill 135 (HB135) is sponsored by State Rep. Danny Garrett (R-Trussville) who chairs the House Ways and Means Education Committee which is tasked with preparing the budget. HB135 is part of a nine-bill package that together makes up the education budget. All nine passed the House on Tuesday.
Garrett spoke with reporters after the budget’s passage.
“It went better than I expected,” Garrett said after the House passed the record budget 100 to 1.
State Rep. Andrew Sorrell (R-Muscle Shoals) was the sole no vote.
Garrett said that the budget cuts debt including $177 million to completely pay off the PACT (Prepaid Affordable College Tuition) Program.
Started in 1989, the state encouraged parents to invest in the PACT, which turned out to be a risky program run by the Alabama Treasurer’s office, where parents and grandparents invested their dollars into what was erroneously promoted as pre-paid college tuition. In 2008, while current Alabama Governor Kay Ivey was the State Treasurer, the stock market crashed at a time when college tuition increased dramatically. The PACT board, as managers of the fund, tried to extricate from the risky emerging markets investments. PACT parents found that they had lost most of their investment’s worth. Alabama’s public universities argued that since they never had the money and did not lose the money, they were not honoring any pre-paid tuition promises. In 2010, while Ivey was still treasurer, the Legislature passed a bill to pump $548 million into the PACT program over 13 years, beginning in 2015. That was intended to make sure PACT could continue to pay full benefits to the approximately 44,000 remaining beneficiaries. The parents got attorneys and the state negotiated a settlement. That settlement has cost the ETF hundreds of millions ever since. The $177 million ends this costly recurring line item in future ETF budgets.
“In the middle of this we cut taxes $200 million,” Garrett said. “In this ETF budget our revenue is artificially inflated. The federal government has put more than $52 billion into the Alabama economy (in COVID relief payments) pumping up our tax receipts.”
Garrett said that the ETF “could have been $9 billion." The Governor took that down to $8.3 billion and the House further took it down to $8.1 billion.
“We still need to do tax reform,” Garrett said. “We need to lower taxes going forward.”
Garrett said that the committee is looking at eliminating the tax on groceries.
“Over half of the increase (in the ETF) is in salaries,” Garrett said. "We have to get qualified teachers in the classrooms."
There is more money in this budget for teachers’ aides; the state now calls them auxiliary teachers.
Garrett said that the qualifications for a certified auxiliary teacher are a two-year certificate or nine credit hours of continuing education in the field.
“We have some really high-performing school systems, but until we get the lowest-performing schools operating at a higher level, our average is going to continue to be poor,” Garrett said.
The state has started the TEAMS program for math and science teachers and 1,400 teachers have entered the program. Garrett said that each classroom would get $900 in pupil supply money from the state in this budget.
New Pre-K classrooms will be added, and more students will be eligible for Pre-K. 1819 News asked, "We reportedly have the best Pre-K program in the country. We have spent hundreds of millions of dollars on Pre-K classrooms; but when we perform testing at the end of fourth grade, we have the worst-performing group of fourth graders in the entire country. Is the Pre-K program not as good as billed or are we doing something wrong between then and fourth grade?"
Garrett answered, “We have auxiliary teachers in Pre-K and kindergarten. When you get to the first grade you don’t have those auxiliary teachers.”
Garrett said that too many classrooms, particularly in those underperforming schools, do not have qualified teachers.
“Some don’t have a teaching certificate, some of them don’t even have a degree,” Garrett said.
Garrett said that the state wants to have a qualified teacher and an auxiliary teacher with the teacher in those early grades.
“We want to be very intentional with math and reading into those early grades,” Garrett explained.
Garrett said that there is money in this ETF budget for a pilot program to start a virtual hub in Birmingham that will be working over the internet with students in Bullock County. The legislature will be monitoring how well that works moving forward.
SEE ALSO: Alabama Innovation Hub to stream certified teachers into classrooms
The ETF now goes to the Senate for their consideration. The state has a budgeting system where most of the money is earmarked and there are two budgets with billions of dollars outside of the two budgets, including $10 billion in federal matching funds for a myriad of agencies.
The Alabama Senate has already passed the State General Fund budget (SGF) which deals with non-education-related spending. The $2.6 billion record SGF will be taken up in the House Ways and Means General Fund Committee on Wednesday.
Wednesday will be day 20 of the 2022 Alabama Regular Legislative Session. There are a maximum of eleven legislative days left in this session. Passing both budgets is the primary constitutional duty of the Alabama legislature and is the primary purpose of the regular legislative session.
To connect with the author of this story, or to comment, email brandon.moseley@1819News.com.
