Budget Watch: Tracking the 2023 Education Trust Fund Budget

It’s that time of year again! The 2022 Alabama Legislative Session began on January 11th, during which important budgetary decisions will be made for Alabama’s schools. We will be updating this page throughout the session as the Education Trust Fund budget moves through both chambers of the Legislature.

Updated

Wednesday, April 6, 2022

Legislature Passes ETF Budget, Now Goes to Gov. Ivey for Signature

Updated

Thursday, March 31, 2022

Senate Passes $8.26 Billion ETF Budget

The full Alabama Senate convened on Thursday, March 31, 2022, to vote on the FY 2023 Education Trust Fund budget. The Senate passed the budget. Now, it goes back to the House for concurrence and then to the Governor for her signature.  The Alabama Legislature is appropriating historic levels of funding, fueled by federal stimulus dollars and strong economic growth. Nearly $10 billion is heading out the door in the following ways:

• $8.26 billion FY 2023 Education Budget: This is the largest Education Trust Fund budget in the state’s history. The previous FY 2022 budget totaled $7.6 billion, making the new FY 2023 budget a 7% increase.
• $1.28 billion FY 2022 Supplemental Appropriation for the current budget year.
• $282 million FY 2022 Advancement & Technology Fund appropriation to fund one-time expenses this year

Here are some highlights from the FY 2023  Education Trust Fund budget:

• Significant Teacher Pay Raises: The Senate’s version of the budget makes significant changes to how teachers are paid over their careers. Alabama has some of the highest starting pay for teachers in our region, but that pay becomes less competitive over teachers’ careers. The goal is provide teachers more regular step raises through the middle of their career and incentivize our veteran teachers to remain in the classroom longer. The bottom line: All teachers will receive a 4% raise. Teachers in their later years would receive up to a 21% raise. Click here for a visual of how these pay increases affect teachers in different stages of their career. Here’s the breakdown: 
  • A 4% across the board pay increase for all public education employees
  • Now, all teachers with at least 9 years of experience will receive an annual step raise of at least 1% (currently step raises only happen every three years)
  • Removes the pay cap for teachers above 27 years of experience, so now teachers will continue receiving annual step raises through 35 years of teaching
• Alabama Numeracy Act: There is $15 million for provisions of the Alabama Numeracy Act. This will be combined with the $5 million for the Governor’s Mathematics Education Coaching Corps for a total of $20 million. In addition, there is $200,000 in supplemental appropriations to the new Office of Mathematics Improvement, which was established by the Numeracy Act, to begin the work prior to the beginning of next fiscal year. Read more about the Alabama Numeracy Act here.
• First Class Pre-K: $22.5 million increase to  add 125 new Pre-K classrooms and increase the percentage of 4-year-olds served from 42% to 45%. It also includes a 4% teacher pay increase and expanded programs to increase the pipeline of pre-K teachers. Read more about Alabama’s First Class Pre-K program here. 
• Summer and Afterschool Grant Program: $1.5 million for a new 3-year pilot grant program administered by the Department of Early Childhood Education, which will fund partnerships between local school districts and community-based organizations to expand access to high-quality summer and afterschool programs. Read more about the importance of these programs here. 
• Classroom Materials: Through the Foundation Program, there is an additional $9.5 million in earmarked funds to pay for classroom supplies for teachers. Currently, the amount is $700 per classroom. This would raise the amount to $900 per classroom. 
• Alabama Reading Initiative/Alabama Literacy Act: The Senate maintained the additional $9 million that the House allocated to fully fund the salaries of local reading coaches and reduce the amount districts have to pay. This is in addition to the $5 million increase in the Governor’s proposed budget, for a total of a $14 million increase over the current year. To learn more about early literacy, click here.
• Alabama Math, Science, and Technology Initiative (AMSTI): The Governor recommended an increase of $3 million over the current year’s AMSTI funding.
• Advanced Placement: $2 million increase to expand access to advanced placement courses. Click here to learn more about the importance of AP courses.
• Computer Science For Alabama Program (CS4AL): $1 million increase to continue training teachers as part of the computer science expansion in K-12 schools started by the 2019 Computer Science bill. Read more about computer science and the need for expanding CS education in Alabama here. 
• Auxiliary Teachers: HB429 by Rep. Nathaniel Ledbetter, if enacted, would place auxiliary teachers (also known as teacher aides or paraprofessionals) in K-3 classrooms in underperforming elementary schools. The ETF budget allocates $5.4 million for this program. 
• Substitute Teacher Funding: $8 million was added to the foundation program to increase the rate at which substitute teachers are currently paid –  increased from $90 per day to $120 per day.
• Underperforming Schools: The Governor recommended a new $10 million grant program for underperforming schools, which the House and Senate maintained. 
• English Language Learners: $2 million increase for English Language Learners to fund state and regional specialists. 
• Marketing Campaign for Teachers: While the Governor recommended $1 million in funding for the continued marketing campaign to recruit teachers to the workforce, the House took it out completely. The Senate Committee added it back at $800,000. 
• Special Education Certified Behavior Analysts: There is a new $8.5 million recommended by the Governor for Certified Behavior Analysts, which was maintained by both Houses. 
• STEM Major Teacher Recruitment Program: There is a new $4.5 million in the budget to expand the UTeach program at the University of Alabama at Birmingham and open 4 new UTeach programs at universities in our state. UTeach is a nationally recognized initiative located at 45 universities across the country to prepare students majoring in STEM to become teachers. This is part of the state’s broader efforts to recruit new teachers.
• TEAMS Act: The Governor recommended a total of $100 million to go towards the TEAMS Act that provides higher compensation for STEM teachers, but the House substitute reduced TEAMS funding by $20 million to match actual demand, for a final amount of $80 million. 
• Technology: An additional $4 million dollars has been put into the budget for Technology Coordinators and an additional $6.8 million was included for improving school cybersecurity. 
• Quality Childcare: $17 million increase in funding to incentivize childcare quality under the Department of Human Resources, for a total of $35.9 million for this line item.

Supplemental Appropriations

For Supplemental Appropriation of $1.28 billion (HB 138) for the current fiscal year, here are some of the highlights:

• • $744 million to the Advancement and Technology Fund: This is up from $651 million that the Governor recommended. This money will be appropriated in future years and will not be sent to schools immediately.
  • $124 million to fully fund the Budget Stabilization Fund: This fully funds the education budget savings account to free up money in future budgets and protect against future economic downturns that might lead to proration, as well as repay outstanding loans. This is up from $111 million that the Governor recommended. 
  • $58.4 million for a bonus for retired teachers: This bonus is $2 per month of service, up from $37.2 million in the Governor’s recommended budget. 
  • $177 million to pay off the PACT program commitment: The state has been making annual payments out of the ETF to honor scholarship contracts from the Prepaid Affordable College Tuition program that went bankrupt during the 2008 recession. This completes that obligation.
  • $2.9 million for public charter schools – (removed in conference committee on April 6)

• $200,000 for the new Office of Math Improvement
• $475,000 to continue the contract with PCG to implement the audit of the ALSDE (Learn more here).

Advancement & Technology Fund 

The Advancement & Technology Fund (HB 267) is a formula-based distribution to local school districts and colleges for one-time projects (equipment, technology, instructional support, maintenance, etc.). Here are this year’s appropriations:

• Immediately Available: HB 267 appropriates $282 million from the Advancement & Technology Fund to districts immediately during the current fiscal year. Click here to see the allocations broken down by district.
• Future Funding: HB 138 sends $744 million to the A&T Fund to be appropriated to school districts in future years.

Updated

Wednesday, March 30, 2022

ETF Budget Passes out of Senate Committee, Moves to Senate Floor

On March 30, 2022, the Senate Finance and Taxation Education Committee passed the bills in the FY 2023 Education Trust Fund budget package. Unlike the House, the Senate Committee did not hold any additional hearings before voting on the Education Trust Fund budget. The Committee passed their own substitute versions of the budget bills, making some small but impactful changes to certain items in the budget package, including:

Supplemental Appropriation Updates (HB 138):

• an additional $104 million (for a total of $756 million) to the Advancement and Technology Fund to be distributed to local districts on a formula basis for one time expenses 
• an additional $12.9 million to fully fund the Budget Stabilization Fund, which can be used to shore up the ETF in the event of proration or an economic downturn
• $2.9 million for public charter schools
• $200,000 for the new Office of Math Improvement
• $475,000 to continue the contract with PCG to implement the audit of the ALSDE (Learn more here)

Education Trust Fund Budget Updates (HB 135):

• Teacher Pay Raises: The budget that passed out of the House included 4% across the board pay increases for education personnel and step raises for teachers in the middle of the salary matrix. The Senate Committee left the 4% raise intact. However, they changed step raises in the salary matrix to an annual increase of about 1% – previously these raises occurred once every three years. The Senate Committee also removed the previous pay raise cap, meaning that teachers with over 27 years in the classroom will continue to receive annual step raises for as long as they stay in the classroom, with the goal of incentivizing teachers to stay in the profession longer. 
• Substitute Teacher Funding: $8 million was added to the foundation program to increase the rate at which substitute teachers are currently paid (in some areas it’s only $10-$12/hour).
• Marketing Campaign for Teachers: While the Governor recommended $1 million in funding for the continued marketing campaign to recruit teachers to the workforce, the House took it out completely. The Senate Committee has added it back at $800,000. 
• At-Risk Program: The Senate Committee increased funding for the At-Risk funding in the foundation program by $2.1 million, for a total of $12,040,633. 

The House passed a version of the Education Trust Fund budget totaling $8.16 billion. With the changes made in the Senate Committee, the budget is now $8.26 billion, still less than the Governor’s recommended budget of $8.3 billion. You can see the Senate Finance and Taxation Education budget spreadsheet here. For our breakdown of other aspects of the ETF budget, see our updates below.

Updated

Thursday, March 8, 2022

AL House Passes FY 2023 ETF Budget

On Tuesday, March 8, 2022, the House passed all 9 bills in the 2023 Education Trust Fund Budget package! One floor amendment was brought to make technical changes to the budget language, none of which affect the budget priorities laid out by the Ways and Means Education Committee. You can read more about what is in the Fiscal Year 2023 budget in our last update below. 

Next, the budget goes to the Senate Finance and Taxation Education Committee as early as next week. Check back here for the latest updates.

Updated

Thursday, March 2, 2022

 House Ways and Means Education Committee Passes FY 2023 ETF Budget

Wednesday, March 2, 2022, the House Ways and Means Education Committee met to vote on their proposed FY2023 Education Trust Fund (ETF) budget. The House version of the ETF budget is $8.175 billion, about $125 million smaller than Gov. Ivey’s proposed budget of $8.29 million. However, with last year’s budget at $7.7 billion, this is again the largest ETF in the state’s history. The budget is expected to be on the House floor next Tuesday and move through the Senate soon after. You can view the spreadsheet for the budget as substituted by the Ways and Means Education committee here.

FY 2023 ETF Budget 

The Committee has left intact many of Gov. Ivey’s priorities from her proposed budget, including:

• Teacher Pay Raises: 4% pay raises for all public education employees, as well as the step raises for teachers in the middle of the salary matrix, which could lead to a total raise of over 8% for the most experienced teachers.  
• Summer and Afterschool Grant Program: $1.5 million line item under the Department of Early Childhood Education for a new pilot grant program to fund partnerships between local school districts and community-based organizations to expand access to high-quality summer and afterschool programs.
• First-Class Pre-K: $22.5 million increase to add 125 First Class Pre-K classrooms and increase the number of 4-year-olds served from 42% to 45%. It also includes funding for a 4% pay raise and programs to increase the pipeline of pre-k teachers.
• Childcare: $17 million increase in funding for childcare under the Department of Human Resources, for a total of $35.9 million for this line item. 
• English Language Learners: $2 million increase for English Language Learners to fund state and regional specialists.
• Student Mental Health: $1 million increase for the School-Based Mental Health Collaborative, which is a partnership between the Alabama Department of Mental Health and the ALSDE. 
• Advanced Placement: $2 million increase for Advanced Placement.
• Computer Science: $1 million increase for computer science expansion in K-12 schools. 

There were some changes made in the House substitutes to the budget, including: 

• Reading Coaches: The House substitute allocates an additional $9 million to fully fund the salaries of local reading coaches so that districts don’t have to come out of pocket. This is in addition to the $5 million increase in the Gov.’s proposed budget (for a total of a $14 million increase).
• Math: In preparation for the potential passage of a new Alabama Numeracy Act (SB 171) the House set aside $15 million to fund implementation, including new math coaches. This could be combined with $5 million for the Governor’s Mathematics Education Coaching Corps, which the Governor had already included in her budget. If the Alabama Numeracy Act does not pass, this funding would still be allocated to various math priorities.
• TEAMS Teachers: The Governor recommended a total of $100 million to go towards the TEAMS Act that provides higher compensation for STEM teachers, but the House substitute reduced TEAMS funding by $20 million to match actual demand. 
• Auxiliary Teachers: $5.4 million has been allocated for approximately 150 auxiliary teachers, who would support classroom teachers in K-3 classrooms in underperforming schools. 
• Classroom Materials: Through the Foundation Program, there is an additional $9.5 million in earmarked funds to pay for classroom supplies for teachers. Currently, the amount is $700 per classroom. This would raise the amount to $900 per classroom. 
• Technology: An additional $4 million dollars has been put into the budget for Technology Coordinators and an additional $6.8 million was included for improving school cybersecurity. 
• Capital Projects: $125 million from the Capital Projects Improvement Fund was removed from the budget. However, the Committee is also passing legislation (SB 175) that would allow schools to use money from the Advancement and Technology Fund on capital outlay, which would allow spending related to building improvements like HVAC or new construction with fewer restrictions. 
• Recruiting STEM Teachers: There is a new $4.5 million in the budget to expand the UTeach program at the University of Alabama at Birmingham and open 4 new UTeach programs at universities in our state. UTeach is a nationally recognized initiative located at 45 universities across the country to prepare students majoring in STEM to become teachers. This is part of the state’s broader efforts to recruit new teachers.

Updated

Thursday, January 13, 2022

Governor Releases Proposed Budget

Governor Kay Ivey released her executive budget proposal to the Legislature, which outlines her education budget priorities, on Wednesday, January 12, 2022. Below are some highlights of her priorities. You can access the full spreadsheet here.

Proposed FY 2023 ETF Budget Bill

To view the introduced FY 2023 ETF budget bill, click here. The Governor’s priorities in next year’s Education Trust Fund budget include the following (partial list):

There is funding for existing programs within the Alabama State Department of Education (ALSDE):

• $5 million increase for the Alabama Reading Initiative (ARI)
• $3 million increase for the Alabama Math, Science, and Technology Initiative (AMSTI)
• $1 million increase for Computer Science expansion
• $2 million increase for English Language Learners to fund state and regional specialists
• $1.5 million increase for Mental Health Coordinator program to fund one coordinator in each school district
• $2 million increase for Advanced Placement
• $1 million increase for Jobs for Alabama Graduates (JAG) programs
• $1 million to continue the new Marketing Campaign for Teachers
• $750K increase for National Board Certified Teacher (NBCT) scholarships
• $10 million for the Special Education preschool program
• $5 million increase for Career Coaches

In terms of funding for new programs within the ALSDE, the budget outlined:

• $10 million for Underperforming Elementary Schools – New grant program announced by Governor Ivey in her State of the State Address to assess challenges and provide additional support to the lowest-performing elementary schools in the state.
• $5 million total for the Governor’s Mathematics Education Coaching Corps – Also announced in Governor Ivey’s State of the State Address, this is a pilot program for math coaches in grades K-5.
• $8.5 million in new funding for an Autism Therapy Program, which would provide more Certified Behavior Analysts
• $450K for the new Online High-Speed Teacher Certification Portal

The Department of Early Childhood Education: 

• First Class Pre-K: $22.5 million increase to add 125 First Class Pre-K classrooms and increase the number of 4-year-olds served from 42% to 45%. It also includes funding for a 4% pay raise and programs to increase the pipeline of pre-k teachers.
• Childcare Quality: There is also a $17.6 million increase under the Department of Human Resources to support increased quality in childcare providers. Improving childcare quality is critical to ensuring children are prepared to learn when they enter school.

Summer and Afterschool Grant Program: A total of $1.5 million for a new pilot grant program to fund partnerships between local school districts and community-based organizations to expand access to high-quality summer and afterschool programs.

Teacher Pay Raises: All K-12 education employees would receive an across-the-board 4% pay raise. In addition, the Governor is proposing increased step-raises in the salary matrix for classroom teachers, which could be a total raise of over 8 percent for the most experienced teachers. 

TEAMS: $100 million for the TEAMS program for STEM teachers

Technology Professional Development Days: $33 million for 2 additional contract days of professional development on technology for teachers

School-Based Mental Health: $1 million to the Department of Mental Health to fund 20 school-based mental health collaboration program sites (10 existing, 10 new), which brings the total number of sites in the state to 81.

Supplemental FY 2022 Budget Bill:

Due to cautious budgeting and very strong economic growth in Alabama during the pandemic (driven in part by federal spending), the state has a current budget surplus of over $1.2 billion from FY 2022. This is an extraordinary circumstance of one-time state money that is not expected to continue. Governor Ivey is proposing to use this surplus to both fund one-time projects for schools and pay off debt that will free up money in future budget years that can then be invested in schools going forward. Click here to view the bill.

In part, Governor Ivey is proposing the following: 

• $651 million for the Advancement and Technology Fund – The A&T Fund is a formula-based distribution to local school districts and colleges for one-time projects (equipment, technology, instructional support, maintenance, etc.).
• $111 million to fully fund the Budget Stabilization Fund – this fully funds the education budget savings account to free up money in future budgets and protect against future economic downturns that might lead to proration.
• $60 million in additional funds to support implementation of the new TEAMS Act for STEM teacher recruitment and retention
• $37.2 million for a bonus for Retired Teachers 
• $200 million for pay off debt that is funded every year out of the ETF budget. 
• $177 million to pay off the PACT program commitment – The state has been making annual payments out of the ETF to honor scholarship contracts from the Prepaid Affordable College Tuition program that went bankrupt during the 2008 recession.

Follow Along for Updates During the Session:

As always, we will update you with more information as it comes available. Follow along with us on Facebook, Twitter, Instagram, or LinkedIn. We will also continue sending our weekly education news round-up, The Gist, every Friday morning with updates from the previous week. Click here to sign up.

New this year, you can access our recently-launched A+ Policy Portal, which provides great information on education issues and will help you follow along during the legislative process.

Updated

Tuesday, January 11, 2022

Recap of the Joint Education Budget Hearing

On Tuesday, January 11, 2022, the first day of the 2022 Regular Legislative Session, the Alabama Senate and House of Representatives held a joint education budget hearing to allow state education leaders the opportunity to share priorities for the FY 2022-2023 Education Trust Fund Budget. Both Kirk Fulford of the Legislative Fiscal Office and State Finance Director Bill Poole presented on the state’s financial status. Due to federal money that came to Alabama as a result of the COVID-19 pandemic, the Education Trust Fund has shown 16% growth over the past year, a historic number (the estimated growth for the next year is 3.61%). Governor Kay Ivey’s proposed ETF budget for FY 2023 is a total of $8.3 billion dollars, a $627 million increase over this year’s budget.

Governor Ivey’s Pre-K-12 priorities for this year’s ETF budget include:

• Investments in Pre-K, summer and afterschool, and daycare programs
• Investments in opportunities for Math and Science students and teachers
• Investments in Professional Development for Teachers
• Expanding access to school-based mental health services
• Preparation for future economic downturns

Governor Ivey will provide more detail in her State of the State address tonight, January 11th, at 6 P.M. She will also release her proposed budget to the Legislature which outlines her budgetary priorities in more detail. This historically happens on the second day of the session.

The Alabama State Department of Education’s ETF budget priorities:

In the afternoon, Dr. Eric Mackey, State Superintendent, presented on the Alabama State Department of Education’s (ALSDE) FY 2023 K-12 budget request. Dr. Mackey focused on literacy, math, and student mental health, and made budget requests in these areas and more, including: 

• $15.5 million increase for reading supports including the Alabama Reading Initiative (ARI), more building based reading coaches, and English Language Learners
• $4 million increase for Alabama Math, Science, and Technology Initiative (AMSTI) and Alabama Science in Motion
• $2 million increase for Advanced Placement (AP)
• $3.5 million for ACCESS distance learning to expand remote courses
• $1.5 million increase for School-Based Mental Health Coordinator Program
• $60 million increase for school nurses
• $11.5 million increase for student assessments, which includes updating the ACAP test to reflect the most recently passed Math and ELA courses of study

Click here for a link to Dr. Mackey’s presentation, including a full list of the Alabama State Department of Education’s budget requests. 

As always, we will update you with more information as it comes available. Follow along with us on Facebook, Twitter, Instagram, or LinkedIn. We will also continue sending our weekly education news round-up, The Gist, every Friday morning with updates from the previous week. Click here to sign up.

New this year, you can access our recently-launched A+ Policy Portal, which provides great information on education issues and will help you follow along during the legislative process.