On Wednesday, the Alabama House Ways and Means General Fund advanced the largest state general fund (SGF) budget in history. The over $3 billion 2024 budget the House will reportedly consider on Tuesday is $15 million more than Governor Kay Ivey requested and $169 million more than the current fiscal year 2023 budget, the previous biggest SGF budget in the history of the state of Alabama.
There are several minor changes between the Governor’s request and the House Committee substitute.
In 2022, the Legislature passed, and Gov. Ivey signed controversial legislation that ended the pistol permit requirement. The Sheriffs said that doing so would devastate their pistol permit revenues. As a result, the Legislature agreed to create a $5 million fund to compensate the sheriffs. The governor kept that $5 million in her budget request. The Committee raised that amount to $7.5 million.
Gov. Ivey cut funds from the Department of Tourism. The Committee restored those funds and gave the Department a substantial increase – a difference of $1,375,000.
She eliminated a $50,000 appropriation for the MOWA Band of Indians. The House restored that line item.
Gov. Ivey’s budget added nearly $10 million to the budget request for the Department of Mental Health. The House Committee added another $4,450,000 to Mental Health. They also added an additional $400,000 to the Department of Human Resources.
The governor completely eliminated a $1,200,000 appropriation for a Huntsville Hospital Health System – workforce development schools for in-demand health professionals. The House restored that funding and added $500,000 to it.
The State Auditor will receive $1,150,819 – $45,000 more than governor’s request. This is a substantial increase from the 2023 budget appropriation of $975,000.
The House raised the governor’s request for the Alabama Forestry Commission by $325,000. They raised the request for the Alabama Department of Economic and Community Affairs $2,415,000. They also added $400,000 for crime victims, $300,000 for district attorneys, and $550,000 for the Department of Agriculture and Industries.
In this budget, the state will spend $661,732,404 on the Department of Corrections. This is an increase from 2023 of $58,798,327 (9.75 percent). This does not include $30,000,000 in a separate line item for debt service for the – Correctional Institution Finance Authority. There is also a separate $11,977,500 line item in the budget for feeding prisoners. That did not get an increase in the FY2024 budget. Additionally, there is a conditional $40 million appropriation for Correctional Capital Improvements that will only be paid if conditions are met.
The Judicial branch will receive $196,415,909 in 2024 – a modest increase from $192,653,808 in 2023. That is just a 1.95% increase. Given inflation and a state employee pay raise, that means no money for new judges – something that Chief Justice Tom Parker has said is needed for years.
The Alabama Department of Environmental Management is getting a considerable boost from the 2023 budget. ADEM’s budget has increased from $12,327,927 to $24,482,935.
The Department of Public Health is also receiving a big boost – increasing from $75,990,897 in FY2023 to $111,772,076 in 2024, including $1,760,000 more than the Governor requested.
The Department of Human Resources is increasing from $107,408,581 to $121,805,400, including $400,000 more than the Governor requested.
The Alabama Law Enforcement Agency is seeing its budget increase from $82,532,287 in 2023 to $112,112,287 in 2024.
The Alabama Medicaid Agency budget will increase from $793,531,700 in 2023 to $862,999,999 in 2024.
The Alabama Medical Cannabis Commission is receiving a budget cut from $3,525,047 in FY2023 to $2,525,047 in FY2024, but the Commission should start to see revenue from the new 9 percent tax on medical cannabis sold in the state of Alabama. Persons with a demonstrable medical need will be able to obtain a recommendation for Alabama-grown medical marijuana products late in the current calendar year.
The Department of Mental Health sees a substantial increase, from $193,994,548 in FY2023 to $209,441,459 n FY2024, including $4,450,000 more than the Governor requested.
The Military Department is receiving an increase from $8,542,605 in FY2023 to $9,527,505 in FY2024. The 2024 budget also creates a new $2,000,000 line item for the Military Department – Armory Commission separate from the Military Department.
The Department of Senior Services is receiving an increase from $82,557,013 in FY2023 to $87,532,998 in FY2024.
The Department of Veteran Affairs is receiving a budget increase from its FY2023 appropriation of $2,441,643 to $3,199,737 in FY2024. This includes $250,000 more than Gov. Ivey requested.
The Department of Youth Services saw its budget increase from $6,704,537 in FY2023 to $7,204,537 in FY2024.
There is a $14,500,000 increase in the cost of living adjustments for state employees. There is also a new $50 million line item for inflationary increases for state agencies and $5.6 million for the State Employees Insurance Board.
There will be no one-time bonus in 2024 for retired state employees. That saves the state $4.8 million.
There is a conditional appropriation of $3.5 million for the State Port Authority.
The Grant Total SGF increased from $2,855,137,387 in FY2023 to $3,024,167,948, including $15,045,000 more than Gov. Ivey requested.
Many agencies, including the Legislative Branch, were either level-funded or received modest percent increases in the House Ways and Means Committee’s proposed budget.
Alabama has a very archaic budgeting system where over 90 percent of revenues are earmarked to specific agencies. Education is in a separate budget altogether. Many agencies have line items in both budgets, and agencies like the Department of Transportation and the Secretary of State’s office don’t even have line items in the two budgets. Most agencies have their own revenues, which go directly to them and not to the budgets, including approximately $14 billion in federal matching funds and federal appropriations.
The full House of Representatives will consider the Committee’s recommendation when it meets on Tuesday. If it passes the House, the SGF will go to the Senate Finance and Taxation General Fund Committee for their consideration.
The House will also consider a separate supplemental appropriation for FY2023.
The 2024 fiscal year begins on October 1.
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