Alabama

Alabama

Budget Links

FY2027 (proposed)
FY2026 (enacted)
FY2025 (enacted)
FY2024 (enacted)
FY2023 (enacted)
FY2022 (enacted - GF)
FY2022 (enacted - ETF)

Proposed Budget - Fiscal Year 2027

On January 14, Alabama Governor Kay Ivey released her fiscal 2027 budget recommendations for the General Fund and the Education Trust Fund. The General Fund proposes $3.7 billion in non-earmarked spending, a decrease of $28.5 million, or 0.8 percent, from budgeted fiscal 2026. The Education Trust Fund proposes $10.5 billion in spending for fiscal 2027, an increase of $569.8 million, or 5.8 percent, over budgeted fiscal 2026. The budget anticipates a beginning balance in fiscal 2027 of $291.5 million in the General Fund and $1.1 billion in the Education Trust Fund. Net receipts to the General Fund are projected to decline 4.2 percent in fiscal 2027 to $3.4 billion compared to the current year. Net receipts to the Education Trust Fund are projected to increase by 2.4 percent in fiscal 2027, to $11.3 billion, compared to fiscal 2026. The estimated balances at the end of fiscal 2027 are $0 for the General Fund and, after accounting for transfers, $825.5 million for the Education Trust Fund. As of September 30, 2025, the available fund balance of the Education Trust Fund Rainy Day Account was $756.4 million, and the available fund balance of the State General Fund Rainy Day Account was $385.3 million.

Proposed Budget Highlights 

The governor’s proposed fiscal 2027 General Fund budget prioritizes responsible stewardship of taxpayer dollars while making targeted investments in public safety and other core services relied upon by residents. The proposed Education Trust Fund budget is the largest in state history and continues generational investments for students, teachers, and parents. 

General Fund

• Provides level funding for agencies including Medicaid, Department of Corrections, Department of Human Resources, Department of Public Health, and Mental Health.
• Funds a 2 percent employee pay raise.
• Increases funding for the state employees’ health insurance program to cover rising costs.
• Allocates funds for a Statewide Emergency Notification System, coordinated by the Emergency Management Agency and State Law Enforcement Agency.

Education Trust Fund

• From the total appropriations, K-12 funding comprises 68.0 percent, higher education funding makes up 25.8 percent, and other funding comprises 6.2 percent.
• Provides additional funds for First Class Pre-K expansion and increased per unit funding, supporting 35 new classrooms and sustaining existing classrooms.
• Increases K-12 funding to local boards of education for a retirement system rate increase, to cover increased health insurance costs, and to support a 2 percent pay raise for teachers.
• Allocates additional funds for the Numeracy Act for 33 regional math specialists.
• Adds funding for the CHOOSE Act, an education savings account program.
• Increases funding for school-based mental health service coordinators. 
• Provides additional operations and maintenance funds for all four-year colleges and universities.
• Increases funding for the community college system, including for the dual enrollment program.
• Allocates funds to the Department of Veterans Affairs for the student financial aid program. 
• Increases funding for the Department of Workforce, providing additional funds to the Alabama Workforce Board and Office of Apprenticeship, along with health care workforce initiatives. 

Proposed Budget Information
Fiscal Year 2027 Budget Proposal  

Education Trust Fund Summary 

General Fund Summary 

Finance Director's Presentation   

Governor's Press Release