MONTGOMERY, Ala. – After the Senate concurred on the House’s amendments, the Alabama Legislature sent its $3.74 billion General Fund budget to Gov. Kay Ivey on Wednesday.
The House version of the budget was $12.6 million higher than the Senate’s $3.72 billion spending bill, but the Senate approved the changes without going to a conference committee.
The budget allocates $16 million for a 2% cost of living raise for state employees and fully funds the expected increase in their health insurance costs. It also includes a one-time, lump sum bonus for state retirees.
The “longevity bonus” consists of $1 per month of service. That amounts to $300 for someone who worked for the state for 25 years.
The Education Trust Fund budget has a similar bonus for retired teachers.
Some of the largest House changes included $2 million increases for airport development and the District Attorneys Administrative Fund as well as a $1.84 million reduction from the proposed appropriation for the Correctional Facilities Maintenance Fund.
Lawmakers also had to find $10 million for the first payment due this fall for the Legislature’s new about $400 million State House.
Several state agencies are experiencing slight funding increases in 2027, although some will see small decreases, including the Alabama Department of Mental Health, which will receive approximately $4 million less next year.
Alabama Daily News previously reported the budget also includes conditional appropriations for several agencies, assigning the departments of corrections, human resources and mental health tasks before they receive all of their 2027 funding.
The General Fund’s supplemental budget also includes $387.5 million for the Public Road and Bridge Fund and $200 million for the Rebuild Alabama Fund, both part of the Alabama Department of Transportation. It also increases funds for highway project bond repayment by $59.8 million for a total of $193.5 million. House Ways and Means Education Chair Rex Reynolds, R-Hazel Green, said the money would help pay for the West Alabama Corridor.
The budget package includes several other funding bills, including ones concerning rural health and domestic violence.
Both budgets now head to Ivey’s desk.