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Education, General Fund budget head to governor

MONTGOMERY – The Alabama Legislature today gave final passage to the state’s education and general operating budgets, which make what House and Senate leaders called “sensible” and “responsible” choices given the state’s decline in tax revenue.

The final adopted version of the Education Trust Fund allows the state to avoid laying off teachers, cutting employees’ pay and incurring proration in the future. It does this by:

• Recouping revenue and ensuring tax fairness for homegrown Alabama companies by requiring out-of-state companies to pay a fairer rate of tax on sales compared to businesses that have facilities and employ workers in Alabama.

• Asking education employees to contribute 2.5 percent more toward their retirement benefits plan over two years. This minimal increase saves the Education Trust Fund $102 million, allowing the state to avoid laying off 1,500 teachers.

Total appropriations in the 2012 Education Trust Fund amount to $5.58 billion. Alabama’s proven education reform programs – the Alabama Reading Initiative, the Alabama Math, Science and Technology Initiative, ACCESS Distance Learning and First Class Pre-K – are fully funded in this budget.

Included in the education budget is funding to provide $134 to each Alabama teacher to spend on classroom materials and supplies. Also included is funding to allow local boards of education to pay their operating expenses.

House Speaker Mike Speaker Hubbard (R-Auburn) applauded House Members and all lawmakers for their deliberate work appropriating school funding.

“Given that the state had almost $600 million less available for the 2012 Education Trust Fund than was budgeted for the current year, we had some very difficult decisions to make,” Speaker Hubbard said. “Alabama lawmakers rose to the challenge making sensible, responsible choices in a tough economic time. This budget allows the state to avoid teacher layoffs, employee pay cuts and future proration.”

Senate President Pro Tem Del Marsh (R-Anniston) said legislators’ top priority was protecting jobs and essential services to ensure limited taxpayer funds were used efficiently.

“We had to make some tough choices, but the state simply cannot spend more than it takes in,” Senator Marsh said. “Doing more with less is never easy, but I commend our budget chairmen for their leadership in making the most with the resources we have available.

State Representative Jay Love, who chairs the House Ways and Means Education Committee said he is proud of the finished product that has come out of the Legislature.

“It wasn’t easy, but we were able to craft a leaner, more efficient budget that makes the most of limited resources,” Representative Love said. “We got creative and found new sources of revenue that make the tax code fairer for small businesses. Most importantly, we passed a budget that funds programs that get results without forcing any teachers to be laid off or receive a cut in pay. I want to thank my counterpart in the Senate, State Senator Trip Pittman (R-Montrose), and all lawmakers who helped throughout the budgeting process.”

Senator Pittman, Chairman of the Senate Finance and Taxation Education Committee, said the education budget ensures taxpayer funds are used in the most responsible and efficient manner possible.

“In the face of difficult economic times tough decisions had to be made,” Senator Pittman said. “The Senate and House education committees developed a budget that maintained school days, funded OCE, transportation and essential programs to keep Alabama’s education systems moving forward.”

The General Fund, which received final passage Wednesday morning, has appropriations totaling $1.8 billion. Though the austere revenue situation made it impossible to avoid funding reductions for state agencies, lawmakers were creative in finding funding solutions and compassionate in setting priorities.

State Representative Jim Barton (R-Mobile), who chairs the House Ways and Means General Fund Committee, said the finished budget is an example of making the best of a bad situation.

“Like most states, Alabama is dealing with a drop off in revenue,” Representative Barton said. “Cuts are always painful, but we took great care to make responsible, compassionate choices when drafting this budget.”

Limited state resources required lawmakers to make many tough decisions in order to balance the budget, said Senator Arthur Orr (R-Decatur), Chairman of the Senate Finance and Taxation General Fund Committee.

“Balancing the budget with fewer resources than last year meant we didn’t have a choice but to make cuts,” Senator Orr said. “We made every attempt to maximize limited funds in a way that’s fair and responsible to the taxpayers.”