BIRMINGHAM, Ala. – With six days left in the 2026 legislative session, Alabama senators are expected to put the finishing touches on their priorities for fiscal year 2027 education spending this week, with the Senate Ways and Means Education Committee set to take up the package today.
The eight-bill package would direct $11.9 billion in education spending for fiscal year 2027. Add another $500 million from reserve funds, and the full appropriation package surpasses $12.4 billion.
After Senate approval, the package would still need a conference committee before final passage.
Before the Senate takes its turn, Alabama Daily News took a closer look at how the House version differs from Gov. Kay Ivey’s original proposal.
The $420 million supplemental allocation – House Bill 235
The sharpest contrast between Ivey’s proposal and the House-passed package comes in the supplemental appropriation bill.
House Bill 235 appropriates $420 million in supplemental revenue, money left over from tax receipts that came in beyond what was budgeted for fiscal year 2025.
Ivey’s supplemental proposal centered on a few large statewide education items, including $66.5 million for school bus fleet renewal and $201 million for one-time State Department of Education initiatives such as school safety, struggling readers, summer and afterschool, the EdFarm initiative and career tech equipment.
The House scaled back several of those larger K-12 items, cutting bus fleet renewal to $25 million and the State Department of Education’s one-time spending bucket to $143 million. It also reduced school safety from $50 million to $25 million and struggling readers from $45 million to $10 million.
Instead, the House spread more of the money across a broader set of agencies, institutions and projects, including $37.5 million for construction costs for the new State House and $10 million for the Executive Commission on Community Services Grants, which is money lawmakers grant to projects in their districts.
The House also added funding for recipients that were not included in Ivey’s original supplemental proposal, including $6.3 million for the Alabama Historical Commission and $3.5 million for the U.S. Space and Rocket Center Commission.
A full look at both Ivey’s and the House versions is listed in the table below. Click here if you’re unable to see the table.
The differences are more muted in the main Education Trust Fund budget. There, the House left most of Ivey’s recommendations in place but made a handful of targeted changes.
The Education Trust Fund FY27 budget – House Bill 238
Broadly speaking, House lawmakers moved some money away from the K-12 side of the budget and toward health needs and a few more targeted institutional projects.
One of the clearest shifts moved about $9 million away from the K-12 side and into the budget’s “other” category. One likely reason is the need for more money for the Children’s Health Insurance Program, or CHIP.
House Bill 238 shows K-12 down about $9.1 million from Ivey’s recommendation, while the “other” category is up about $9.1 million. Public Health also rises by about $9.9 million, including the new $9.25 million CHIP line.
The House also reduced the Foundation Program by about $21 million. That appears to be tied largely to its decision to use a lower employer rate for teacher health insurance than Ivey recommended.
The House version uses a PEEHIP employer rate of $1,048 per employee per month, compared with the governor’s proposed $1,073, lowering the amount needed in the Foundation Program.
At the same time, the House added money for a few more targeted priorities, including $10 million for Legislative Council tied to the new State House debt and $4 million through the Postsecondary Education Department for training equipment for the Alabama Centers for Rural Healthcare.
The Education Advancement and Technology Fund – House Bill 236
House Bill 236 appropriates $1 billion from the Education Advancement and Technology Fund, a reserve fund built up in previous years under the Rolling Reserve Act. While the higher education portion stayed the same as Ivey’s proposed $275.1 million, the House reshaped the rest by shrinking the K-12 allocation, carving out $4.9 million for named local school projects and increasing career tech matching grants from $100 million to $150 million.
The Educational Opportunities Reserve Fund – House Bill 237
House Bill 237 would transfer $500 million from the Educational Opportunities Reserve Fund. Ivey’s version would have sent $362.5 million to the RAISE fund, which provides additional funding to K-12 schools based on student needs, and $137.6 million directly to colleges and universities.
The House instead sent $399 million to the RAISE fund and $101 million to the newly created CHEER fund, which would distribute money to colleges and universities based on outcome goals.
Other education budget package bills
The remaining bills in the package are more straightforward. House Bill 239 authorizes a 2% raise for education employees at an expected cost of $100 million, while House Bills 240, 241 and 242 appropriate a combined $18.2 million to Tuskegee University, Talladega College and Southern Preparatory Academy.