Goat Hill Report- Week Ending April 25, 2025

This week the Alabama legislature completed Days 24 and 25 of the 2025 session. The legislature now has five days remaining of the (maximum) 30-day session. The session is expected to wrap up on Thursday, May 8. Legislative leaders have indicated that next week will be a two-day legislative week and the final week will be a three-day week. Details of this week’s notable action and news items are provided below.

Update on Education and General Fund Budgets

Both state budgets continued their progress this week. On Thursday, the House approved an education budget that will invest a record $12.2 billion into the various levels and programs of education in the state. The education budget now goes back to the Senate, where it originated, for concurrence or to be sent to a conference committee. The most notable aspect of the education budget is that it reflects a shift in how state funds are allocated to K-12 schools. Specifically, the FY26 budget proposal includes new investments in accordance with the RAISE Act, which allocates additional state funds to schools based on student needs/factors such as poverty, rural location, English learners and gifted education. The education budget also allocates more funds to education savings accounts created under last year’s CHOOSE Act, and shifts funds from multiple state agencies into the newly created Department of Workforce.

Notable education budget items include:

• The CHOOSE Act funding of $101.5 million represents the largest new expenditure in the budget.
• The Department of Early Childhood Education is looking at a $12.4 million increase, with $12 million of that going for new First Class Pre-K programs.
• Numeracy and Literacy initiatives will see increases for the two learning initiatives lawmakers approved in recent years. Total funding for the Alabama Numeracy Act is $95 million, up $27 million over the current year’s budget. The Alabama Literacy Act is a part of the Reading Initiative, which will see a $9.1 million increase to bring total funding to $152 million.
• Community colleges will see a $35 million increase for such programs as prison education, dual enrollment, LPN programs and adult education.
• Four-year colleges and universities will see a $111 million, or 6.6% increase over last year’s budget, with most of the increase going toward operations costs. Individual colleges are looking at budget increases of 5.7% to 9.4%
• The Department of Mental Health will see an increase of $5 million, including $2.5 million for community provider rates.

The General Fund budget, which funds all non-education functions of state government, has not progressed as far as the education budget. The GF budget, which originated in the House and is now pending in the Senate, passed out of the Senate Finance & Taxation General Fund Committee on Thursday. It is expected to be considered on the Senate floor when the Senate reconvenes on Tuesday. The Senate committee’s proposed General Fund budget for 2026 remained a record-high $3.7 billion, but it included several cuts to the House version including $2 million less for an electric vehicle grant program, $3 million less for broadband expansion grants and $3.9 million less for the Board of Pardons and Paroles. Senate General Fund Budget Chairman Greg Albritton (R-Range) noted that no agency saw funding reductions when compared to the current fiscal year. House General Fund Budget Chairman Rex Reynolds (R-Hazel Green) made public comments that he had met with Albritton to discuss the proposed changes and cuts that ultimately passed out of committee Thursday. Reynolds said he’s hopeful the cuts would be restored when the budget makes its way to the Senate floor next week. During Thursday morning’s committee meeting, members cautioned that this year’s GF budget may be the last in which the state would have such strong revenue to work with, at least for the foreseeable future. The state is projected to see a decline of federal funds amounting to hundreds of millions of dollars over the next several years.

What’s Next for the 2025 Session?

With five meeting days remaining in the legislative session, several high-profile bills are still awaiting final passage. These include:

ALFA Health Plan – HB477 by Rep. David Faulkner (R-Mountain Brook); Status: Passed out of Senate committee
HB477 is the top priority of the influential Alabama Farmers Federation (ALFA) and seeks to establish a health benefit plan for its membership. Ten other state farm bureau groups have passed similar legislation. The proposal has been heavily scrutinized by insurance giant Blue Cross Blue Shield of Alabama and health care consumer groups throughout the process. One recurring criticism of HB477 has been the lack of oversight for the Alabama Department of Insurance. Almost twenty amendments have been added to the bill thus far.

Hemp Restrictions – HB445 by Rep. Andy Whitt (R-Harvest); Status: Passed out of Senate committee
HB445 seeks to establish a regulatory framework for consumable hemp products through the state’s Alcoholic Beverage Control (ABC) Board. The bill would allow ABC to issue licenses for manufacturing, wholesaling, and retail sales. Additionally, these sales will only be allowed in 21+ stores and there are strict THC and product limits in the bill. The intent of HB445 is to ban dangerous and potentially addictive products that are accessible across the state, but lawmakers are also weighing input from businesses and consumers who utilize CBD products for health and wellness purposes.

Water Works – SB330 by Sen. Dan Roberts (R-Mountain Brook); Status: Pending action in House committee
SB330 was introduced in response to ongoing mismanagement concerns with the Birmingham Water Works (BWW) – which serves over 750K customers across a 5-county area of metro Birmingham. Recent reporting suggests that billing and service problems are a continued problem for BWW, and the legislation would reduce the number of board appointments and require certain professional credentials for members. Proponents of SB330 have also pointed to recent water supply issues in Jackson, MS as one justification for stricter control on the operations of BWW.

Bills of Interest to the Concrete Industry

House Bill 578 by Representative Wood would regulate new aggregate quarries in the state. The bill has not moved since it was introduced last week.

House Bill 597 by Representative Clouse would allow public agencies to begin using alternative design methods for public works projects in lieu of the typical design – bid – build. The bill has not moved since it was introduced last week.

The Alabama Legislature will reconvene on Tuesday, April 29, 2025.