MONTGOMERY — Governor Kay Ivey released her proposed budget recommendations for the 2026 fiscal year on Wednesday, with increased funding for the state’s General Fund (GF) and Education Trust Fund (ETF), while state leaders advised caution due to anticipated revenue slowing.
Ivey’s proposed budget is in keeping with her “number-one focus” during this legislative session, with plenty of additional GF dollars going to expand public safety,
For the ETF, Ivey proposed a total of $9.9 billion in funding, up $900 million for FY2025. The proposed GF budget totals $3.3 billion, up by $300 million from FY2025.
Despite the budget surpluses, state finance director Bill Poole told lawmakers "the sugar high is over,” speaking of anticipated drops in state revenue in the coming years. Poole warned of a 1.65% decrease in total GF receipts in FY2026 while predicting 1.82% growth in the ETF.
The perceived ending of the sugar high led Ivey not to propose a traditional supplemental appropriations bill, Poole said.
“There will be a supplemental, but it will only be to navigate a couple of inter-agency transfers of existing funds,” Poole said. “Kind of some technical authorizations that they need. So you will see a supplemental bill in the package; it does not contain the traditional supplemental appropriations for projects and whatnot that you would typically see.”
State deputy fiscal director Kirk Fulford also spoke to lawmakers, warning of diminished incomes in the coming years and emphasizing caution in this year’s budgeting process.
“[ETF revenue] was abnormally high, so everyone needs to understand that it needs to absolutely come back down and moderate down to something sustainable,” Fulford said. “And not because of anything you do, just because of what the economy can support, or what the ETF can support on an ongoing basis.”
Lawmakers who spoke to 1819 News did not have much of an initial reaction to Ivey’s proposal, expressing little in the way of criticisms of the recommendation.
“You may see some changes; I don’t know [if] you’ll see a lot,” said House Speaker Nathaniel Ledbetter (R-Rainsville).
Ivey’s GF proposal includes several increases in keeping with her promise to prioritize public safety. Ivey’s proposal includes $141.8 million to the Alabama Law Enforcement Agency (ALEA), up $12 million from the previous year. The ALEA funding includes nearly $4 million for in-car cameras and body camera storage.
It also includes $3 million in funding for the state’s Metro Area Crime Suppression (MACS) Unit, the state-run unit designed to crack down on high-crime areas. The MACS Unit has already shown significant success in Montgomery. The budget proposal would include the $3 million in recurring appropriations supporting a permanent, 24-man crime suppression unit.
Poole also noted that the proposed budget does not include raises for state workers. However, due to increased insurance costs, Ivey is seeking another $21 million.
Additional notable GF increases include:
· $827 million to the Alabama Department of Corrections, an increase of $90 million. The funds allocated mostly go to hiring additional staff and services for the new Kay Ivey Correctional Facility in Elmore.
· $1.2 billion to Medicaid, up nearly $250 million.
· $248 million to mental health, up $10 million from the previous year.
· 9.1 million to the Emergency Management Agency for disaster response contracts, up $400,000.
Likewise, the proposed ETF budget has several items designed to prioritize education and expansion of the
The $524 million in supplemental appropriations is aimed at initiatives such as school safety ($50 million), transportation ($100 million), the CHOOSE Act ($50 million), grants and other allocations to higher education.
The $9.9 billion would be split up in the regular ETF budget, with $6.7 billion going to K-12 schools, $2.6 billion to higher education, and $614 million in “other funding.”
The K-12 funding includes a $101 million allocation for the state’s school choice law, the CHOOSE Act. Other notable earmarks include:
· $10 million for turnaround schools.
· $27 million for math coaches related to the Alabama Numeracy Act.
· $10 million for “English Language Learners.”
All state four-year colleges will receive at least a 5.67% increase in operations and maintenance.
To connect with the author of this story or to comment, email craig.monger@1819news.com.
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