Governor makes history by signing first bill into law; future education budgets to be more fiscally
17-Mar-2011
HB 57 by Rep. Greg Canfield, R-Vestavia, ends the practice of relying on revenue estimates that extend some 18 months in advance to determine the total amount of money available to appropriate. Accurate revenue estimates from such volatile tax sources have proven to be elusive for far too many years. Coupled with pressure on legislators to spend all available funds each year, it is easy to understand why more than one-third of the last 33 budgets have been subject to mid-year education budget cuts, commonly referred to as proration.
Beginning with the 2012 session, the Legislature will use a fiscally conservative formula to determine the total amount that can be appropriated in a given year. This amount will be based on the historical 15-year growth rate of recurring revenue. The bill also ensures that non-recurring revenue will not be used to fund recurring expenditures.
"In passing this bill, the Legislature took a big step in working to make sure Alabama always budgets responsibly," Gov. Bentley said. "By using a more sustainable budgeting process, proration in our Education budget will soon be a thing of the past. The bill which I signed into law today provides sustainable growth and spending for the Education Trust Fund."
This is the third year Canfield had introduced the bill, which has wide support in the education and business communities. The Alabama Association of School Boards, the School Superintendents of Alabama, the Higher Education Partnership and the state Department of Education are among its many supporters. Canfield singled out the BCA, the Birmingham Business Alliance, the Shoals Area Chamber of Commerce and the Mobile Area Chamber of Commerce for rallying the business community to support the bill.
Although the bill passed in the minimum time possible, a cloture vote was needed to end debate and bring the bill to a vote on the Senate floor, where the bill passed 23 to 10. Opponents attempted to delay the bill's implementation and extend the repayment of some $437 million to the State's Rainy Day Fund, supposedly to catch-up on funding for the classroom, but the bill remained intact.
"We are grateful to Rep. Canfield for his hard work and persistence in bringing forward this commonsense approach to budgeting," said BCA President and CEO William Canary. "This is the first step in our journey to create a true business-education alliance in Alabama."
Exerpt from BCA Capital Briefing
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