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House approves record-high $3 billion budget

MONTGOMERY, Ala. – The Alabama House on Tuesday unanimously approved a General Fund budget of just over $3 billion in spending for the 2024 fiscal year, approximately $15 million more than what Gov. Kay Ivey had requested. The House also approved a $201.7 million supplemental appropriations bill for the current fiscal year, $13.27 million higher than Ivey requested.

The sponsor of the $3 billion budget bill, Rep. Rex Reynolds, R-Huntsville, called the spending plan a “strong budget for Alabama,” and said on the House floor that Ivey should be commended for her budget recommendations.

The budget includes a 2% cost-of-living pay increase for state employees and represents a nearly 6% increase over the current fiscal year’s budget of $2.86 billion. Some of the largest expenditures are for prisons and health services. View below for a summary of significant 2024 budget expenditure increases.

Alabama State General Fund Budget Expenditures
Expenditure 2023 2024
Dept. of Corrections  $602.9 Mil  $661.7 Mil
Dept. of Environmental Management  $12.3 Mil $24.5 Mil
 Dept. of Public Health  $76 Mil $111.8 Mil
 Dept. of Human Resources  $107.4 Mil $121.8 Mil
 State Law Enforcement Agency $82.5 Mil $112.1 Mil
 Medicaid $793.5 Mil $863 Mil
 Dept. of Mental Health  $194 Mil $209.4 Mil
 Board of Pardons & Paroles $82.6 Mil $87.5 Mil

Compared to the governor’s recommendations, Reynolds attributed the budget increases to significant spikes in revenue seen in fiscal year 2023, with an increase of more than $153 million from interest collected on state deposits alone. Additionally, 2023 saw a 4.68% increase in revenue from the state’s insurance premium tax, a 19.8% increase in revenue from the state’s Simplified Sellers Use Tax, and a 10.7% increase in revenue from the state’s use tax.

“The governor sent a very strong budget bill over here; we did amend that and offer a substitute in committee, and that was just based on some increases in revenue that we were seeing,” Reynolds said following the bill’s passage. “Obviously, from the time the governor transmitted the budget, we were able to see a couple more months of receipts in revenue so we plussed that up about ($15) million above what she had allocated.”

The supplemental appropriations bill, which permits additional expenditures to the current fiscal year’s budget, also passed unanimously in the House, and would increase expenditures to the tune of $201.7 million.

Major expenditures included in the proposed appropriations bill include $39 million to the Department of Mental Health, $23 million of which would be used toward construction at the Taylor Hardin medical facility, $5.7 million for the Huntsville Armory construction, $8 million for a new criminal history computerized system for the State Law Enforcement Agency and $12 million for the Alabama Forestry Commission.

Much like the proposed 2024 budget bill, Reynolds attributed the increases to unexpected spikes in revenue in 2023. Both bills now move to the Alabama Senate.

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