BIRMINGHAM, Ala. – Alabama lawmakers on Thursday gave final passage to the RAISE Act, a new K-12 public school funding formula that distributes additional education dollars based on student needs.
The Alabama House also approved a three-year, $375 million investment to begin funding the changes, but that transfer still needs final Senate approval.
“The RAISE Act is basically our step into the world of funding education based on student needs and not on resources the way Alabama does it today,” House education budget chairman Danny Garrett, R-Trussville, told reporters. “This is really transformative.”
With its passage, Alabama becomes the 46th state to adopt a weighted student funding model. The new formula will operate alongside Alabama’s 30-year-old Foundation Program, which remains in place as a base layer. The RAISE formula adds targeted dollars for students who face greater challenges, including poverty, disabilities and language barriers.
Garrett and Senate education budget chairman Arthur Orr, R-Decatur, led a year-long legislative task force that studied alternatives to the state’s existing formula and ultimately recommended a hybrid approach.
“They were very supportive of these new changes … adding additional funding based on student needs is huge,” Garrett said. He noted lawmakers were surprised at how much money districts would gain under the new approach.
Lawmakers plan to spend $375 million from the Education Opportunities Reserve Fund to fund the new formula: $100 million in fiscal year 2026, $125 million in FY 2027, and $150 million in FY 2028.
Garrett said $166 million will be allocated through the formula’s first year. Some of that money comes from line items in the education budget, including grants for English learners and at-risk students. The rest comes from the EORF transfer.
Under the RAISE Act, the base funding amount is tied to the previous year’s average per-student Foundation Program allocation — $7,500 for FY 2026. Additional “weights” are added for students who qualify under one or more categories:
- Up to 20% more for students in poverty
- Up to 25%, 50%, or 150% for special education students, depending on disability
- Up to 15% for English learners, with an extra 5% in high-EL districts
- Up to 5% for gifted students
- Up to 10% for charter students, depending on local tax revenue of their authorizing district
Students can qualify for multiple weights, and the weights may be adjusted during future budget cycles.
Click here to see the full breakdown shared with House lawmakers prior to passage of the RAISE Act.
Use the chart below to see how much new funding each district will receive under the RAISE formula, including breakdowns by poverty, special education, English learners, gifted and charter funding. Click here if you’re unable to see the table.
The formula will be phased in over time. The initial $166 million represents only a portion of what districts will receive once the formula is fully implemented.
Alabama Daily News obtained the printout Garrett shared with lawmakers showing what traditional school districts and charter schools would receive under the new formula.
In nearly all districts, the targeted amounts they’ll receive through the RAISE formula for special populations are at least twice as much as the amounts they’re currently receiving through other funding mechanisms like grants or at-risk funding.
With the new funding comes new accountability, though. “There’s very strict accountability provisions in the RAISE Act that requires that money be spent on those [student] needs,” Garrett said.
Education officials praised the move.
“I think that they really did their homework,” said State Superintendent Eric Mackey. “They found the right balance.”
He said that balance includes keeping the Foundation Program in place, which already accounts for local poverty and property values and ensures a basic level of funding for every district.
Alabama Association of School Boards Executive Director Sally Smith called the new formula a long-overdue correction.
“School leaders are elated and appreciative that the Legislature is addressing the historic underfunding of special education students, English language learners and students living in poverty,” she said.
But Smith also cautioned that long-term success depends on sustained funding.
“This program is funded from a one-time source of revenue that will need to be infused and hopefully expanded in future budgets,” she said, citing future budget pressures like the CHOOSE Act and tax changes.
A+ Education Partnership President Mark Dixon said the new law lays the groundwork for major change.
“It moves from a one-size-fits-all approach to actually funding schools based on needs of the students they serve.”
Dixon’s organization helped form the Every Child Alabama Coalition, a group of education and business leaders focused on replacing Alabama’s outdated funding formula.
While the RAISE Act is now headed to the governor’s desk, the education budget still needs concurrence from the Senate, which Garrett expects to happen Tuesday.