By Brandon Moseley
Alabama Political Reporter
Wednesday, November 4, Alabama Republican Party Chairwoman, Terry Lathan, released a statement pertaining to the Education Trust Fund surplus.
Chairman Lathan said, “There is much to celebrate in Alabama this week with the news of a $140 million surplus in the Alabama Education Trust Fund. A report from Mike Carson, of al.com, details the specifics of this recent release of information.”
Chairman Lathan said that, “As a conservative activist and a former public elementary school teacher, I applaud the reforms that have given our schools a surplus. Ignored by Democrats for decades, the challenge of fiscal responsibility in education was met and conquered by the Republican majority resulting in much needed reforms that will directly support our students. Our Republican elected officials will continue placing our children first while keeping a watchful eye on our education funds that parents and citizens invest in with their tax dollars.”
Lathan said, “Since 2001 to 2011, Alabama has been in proration six times. In 2011, the first Republican majority legislature was seated, and since then, there has been no proration. Along with Governor Robert Bentley, the Republican legislature quickly tackled this reoccurring education budget problem with historic reforms. This is not an accident. It was conservative actions in motion.”
State Representative Tim Wadsworth (R-Winston County) said in his own statement, “Money flowing to Alabama’s Education Trust Fund exceeded spending by $140 million. About $118 million will go into the Budget Stabilization Fund to be used in leaner times. This will be the first year for excess money to go into the Budget Stabilization Fund set up by the four-year-old law.”
Rep. Wadsworth wrote, “The other $22 million will go into a new Advancement and Technology Fund for education established by the 2015 regular session. The new education Advancement and Technology Fund can be used for repairs and deferred maintenance, insuring facilities, classroom instructional support, transportation and the purchase of technology and equipment. A separate appropriation bill will be required to authorize spending from the Advancement and Technology Fund. For your information, the $437 million borrowed from the Alabama Trust Fund in 2009 was paid in full this Summer, 2015.”
The budget problems that plagued the State this past year has been in Alabama’s State General Fund (SGF). Most of the growth taxes, sales and income, are earmarked for the Education Trust Fund (ETF).
After the Great Recession ended, those revenues increased with an improving economy. The SGF, which funds most of the non-education functions of government including: the courts, parks, law enforcement, prisons, health department, commerce department, and Alabama Medicaid is where the recovery has been much slower. The legislature raised taxes by approximately $80 million for the SGF and transferred approximately $82 million in use taxes from the 2016 ETF to the 206 SGF; but most SGF agencies still received cuts from their 2015 budgets due to the rapidly escalating costs of Medicaid and maintaining the corrections system.
Alabama had had 135 years of Democratic Party legislative domination; until the Republican landslide election of 2010 that gave the GOP super majorities in both Houses. Those super majorities grew even larger in the 2014 election.
Critics of the GOP’s education budget point out that that surplus was largely made by making teachers and education workers contribute more for their retirements and by not giving but one cost of living adjustment (COLA) raise in the last eight years. Education retirees did not get even that. If the COLAs had actually been made since the Recession ended there would be no extra $140 million.
