Governor Kay Ivey has signed the General Fund and Education Trust Fund bills.

April 9, 2026 – MONTGOMERY, Ala. – It took all thirty days of the legislative session, but the Legislature has finally performed it's constitutional duty and passed both state budgets: the state general fund (SGF) and the education trust fund budgets (ETF). On Thursday Governor Kay Ivey (R) signed both budgets into law.

"Throughout my tenure as governor and even before, we have worked hard to be fiscally conservative in our budgeting, making meaningful investments to benefit the people of Alabama," said Gov. Ivey in a statement. "This Regular Session wraps up my 10th as governor, and I am proud of the fact that we have not once declared proration. Our General Fund wisely invests in our core government services, and our Education Trust Fund is once again the largest ever investment in education in our state's history. Thank you to our budget chairmen, Sen. Greg Albritton, Rep. Rex Reynolds, Sen. Arthur Orr and Rep. Danny Garrett, for their outstanding leadership. And thank you to our Legislature for continuing our strong track record of wise budgeting in Alabama."

The Legislature passed and the governor signed a record $10,479,207,990 education budget. That includes over a half a $billion increase from the 2026 budget. Most of that money was spent on higher personnel costs particularly health insurance costs. 67.87% of the money will be spent on K-12 education. 25.87% is allocated to higher education, and 6.26% goes to other agencies including the legislature.

The education budget is sponsored by Representatives Danny Garrett (R-Trussville) and Senator Arthur Orr (R-Decatur). They chair the House and Senate education budget committees.

The state general fund is not as rosy. After years of increases in general fund revenues the forecast is zero growth in the revenues available to the general fund. Every time someone moves to Alabama for a job, a teenager joins the workforce, or an employee gets a raise the education budget gets an increase. The general fund is barred by the Alabama Constitution from receiving any income tax dollars. Instead it relies heavily on taxes on utility bills, taxes on insurance payments, interest on the Alabama Trust Fund, investments on funds held by the Treasury, internet sales taxes, and other income sources.

The 2027 general fund budget is $3,737,357,400 – which is a record, but it is an increase of only $12,595,000. $12.6 million is a lot of money; but not for an organization that had $3,716,178,429 to spend last year. Governor Ivey's originally requested a general fund cut from 2026 when she made her state of the state speech at the start of this session. Those final budget numbers have grown over the process ending with a budget increase of less than .34 percent – which does not cover the cost of inflation much less the soaring employer healthcare costs that are hitting public and private employers alike.

Medicaid is the largest item in the SGF. The 2027 budget line item for Medicaid is $1,179,054,000 – exactly what it was in the 2026 budget. Expanding Medicaid to cover more people is an impossibility with these numbers.

The second largest item in the SGF is the Department of Corrections (the prisons) which received a very slight increase at $868,019,393. That $500,000 increase is barely over .05 percent.

Most SGF programs are level funded. Some including Mental Health and the Department of Public Health received slight decreases. The cost of debt service in the general fund has risen from $15,009,600 to $17,623,398.

As of press time, both the House and the Senate are still working passing bills and dealing with governor's messages. Since this is day 30, constitutionally this session has to end by midnight tonight.

This was Governor Ivey's tenth and final budget signing. Next year it will be a new Governor as Ivey – the oldest governor in state history - is term limited from running for a third consecutive term.

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