MONTGOMERY, Ala. — Members of the Alabama Senate General Fund committee advanced a substituted version of the 2026 General Fund budget Thursday, totaling a record-high $3.7 billion in spending, which included some modest cuts that House leaders say they’re hopeful will be restored next week.
Committee members Thursday morning prefaced this year’s budgeting process as being among the last in which the state would be flush with revenue, at least for the foreseeable future. The state is projected to see revenue hits in the hundreds of millions of dollars over the next several years, in large part due to lost revenue from interest on federal dollars sitting in state accounts.
“I told my people that this is probably going to be the last year that’s going to be the good year, it’s going to be scraping the barrel (going forward),” said Sen. Linda Coleman-Madison, D-Birmingham.
Nevertheless, the proposed General Fund budget for 2026 remained a record-high $3.7 billion, which passed out of the House in early April. When brought before the Senate committee, however, a substitute was introduced that included several cuts compared to what the House had adopted, including $2 million less for an electric vehicle grant program, $3 million less for broadband expansion grants and $3.9 million less for the Board of Pardons and Paroles.
“So we’re trying to reduce the spending,” said Sen. Greg Albritton, R-Range, the chair of the committee, speaking with Alabama Daily News.
“(We’re) not completely successful (in reducing spending) because there are other needs out there, locals and others, that had to get funding too, and that was spread out quite a bit. So that was the basic difference (in the substitute).”
Albritton was quick to note, however, that no agency saw funding reductions when compared to the current fiscal year.
Rep. Rex Reynolds, R-Hazel Green, who chairs the House budget committee, told ADN Thursday that he had met with Albritton on Wednesday to discuss the proposed changes and cuts that ultimately passed out of committee Thursday. He said he’s hopeful they would be restored when the budget makes its way to the Senate floor next week.
Based on his discussions with budget leaders, Reynolds also said that he was optimistic on both the General Fund and $9.9 billion Education Trust Fund budgets being agreed and concurred upon by both chambers without issue.
“There was one line item that’s going to possibly be talked about on the floor, where the EV funding has landed, and then there was another cut, $3 million to the broadband line item, and we’re going to try to get that put back in there and he’s considering fixing that on the floor,” Reynolds told ADN.
“We really feel good about it. I think based on what I’m hearing from my colleagues on the ETF side, we may see a concurrence on both the General Fund and the ETF.”
Like Reynolds, House Speaker Nathaniel Ledbetter, R-Rainsville, also expressed optimism that his chamber would likely be able to resolve any disagreements between his chamber and the Senate without issue.
“I applaud both chairmen in the Senate and the House, they’ve worked together to try to have it come down for concurrence,” Ledbetter told ADN, speaking outside the House floor.
The 2026 budget as passed by the Senate committee preserves increases made to Gov. Kay Ivey’s budget proposal by the House, which includes an additional $2.4 million for law enforcement, $7.5 million for the state’s Airport Development Grant Program, and a conditional $37.5 million for the construction of a new State House.
The modified budget also preserved cuts made to Ivey’s recommendations, including $5 million less for Medicaid and nearly $3.7 million less for the Department of Mental Health.
While budget leaders have largely predicted a smooth path to agreement on the proposed 2026 budgets, subsequent years, Albritton warned, will likely demand major adjustments.
“We are showing in fiscal year 2027, we anticipate less revenue in the General Fund and in the ETF, and the reason for this is because we’ve done tax cuts; not a slowing of the economy, but a reduction in the revenue that we’re taking from people,” Albritton told ADN.
“So we’ve got to make the government fit into that. The difficulty comes in that everybody’s accustomed to having a very, very fat wallet, someone else’s wallet, and that’s what’s going away, and we’ve got to adjust to that.”
Albritton said he anticipates the GF budget being taken up on the Senate floor on Tuesday. If passed, it would then be sent to the House, where members of the lower chamber can vote to either concur with the Senate version, or work out the differences in a conference committee.