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Higher ed requesting $2.01B in 2023

By MARY SELL, Alabama Daily News

Expecting more revenue in the state’s Education Trust Fund in fiscal year 2023, the Alabama Commission on Higher Education is requesting $2.01 billion for two- and four-year institutions.

The ACHE board approved the 17.53% funding increase on Friday while acknowledging that recent growth in the EFT likely can’t be maintained.

The state’s General Fund and Education Trust Fund saw double-digit growth in fiscal 2021, at least in part to billions of dollars in federal COVID-19 aid. State budget experts have warned lawmakers not to assume that rate will continue indefinitely. The current fiscal year’s ETF is a record $7.6 billion.

Besides the regular crafting of the state’s education and General Fund budgets, lawmakers could also distribute in the upcoming session hundreds of millions of dollars in American Rescue Plan Act funding.

Jim Hood, ACHE’s deputy director of financial and information systems, said the recommendation is in part based on expected revenue increases in the next budget year, including income and sales and other taxes. Higher education typically receives about 25% of the total ETF.

Hood said ACHE leaders realize recent significant revenue increases are not sustainable moving forward and at least some should be considered one-time money. 

The board is asking that about $83.15 million be spent on one-time capital expenses. Capital needs at universities were highlighted during November ACHE meetings.

“We feel this is a responsible approach for using these additional funds while recognizing the feedback we received,” Hood said.

During those meetings, university leaders talked about the need for more competitive salaries for staff and technology improvements, especially in the wake of COVID-19.

Commission Executive Director Jim Purcell and other state agency leaders will present their financial requests to lawmakers when they convene the 2022 legislative session on Jan. 11.

The recommendation also includes a 5% increase for the need-based Alabama Student Assistance Program

The Alabama Community College System is requesting a 14.8% state funding increase in fiscal 2023.

The ACCS board approved on Wednesday the request that would bring the 24-college system’s allocation in the state education budget to $539.9 million.

Legislative budget makers have said they expect to increase spending in 2023 in some key areas, including raises for educators and bonuses for retirees.

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