HB315 Alabama 2014 Session

Summary

Primary Sponsor

Rod Scott

Democrat

Co-Sponsors

James E. BuskeyArtis McCampbellMarcel BlackCraig FordBarbara Bigsby BoydDarrio MeltonMerika Coleman

Session

Regular Session 2014

Title

Education Trust Funds, repeal Education Trust Fund Rolling Reserve Act, reenact Education Trust Fund Proration Account, Sec. 40-1-32.1 reenacted; Act 2011-3, 2011 Reg. Sess., repealed

Summary

HB315 repeals the Education Trust Fund Rolling Reserve Act and creates a Proration Prevention Account to stabilize ETF funding and prevent proration.

What This Bill Does

The bill replaces the Rolling Reserve Act with a new Proration Prevention Account in the state treasury, funded by 75% of the ETF's unanticipated, unappropriated ending balance each year. Withdrawals from the account can be used only to prevent proration, must be certified by the Governor, and require a two-thirds vote of both legislative chambers; repayments are set by the Legislature and can be suspended in prorated years. Interest stays in the account, and any amount over 10% of the previous year's ETF appropriations would revert to the ETF for public education funding. The act becomes effective a few months after passage.

Who It Affects

• Public schools, school districts, and students in Alabama, as the funding stability of the Education Trust Fund could be improved by reducing the likelihood of proration.
• Governor, Comptroller, and the Legislature, who would oversee the Proration Prevention Account, authorize withdrawals, mandate certification, and approve repayments.

Key Provisions

• Repeals Act 2011-3 (the Education Trust Fund Rolling Reserve Act).
• Reenacts Section 40-1-32.1 to create the Education Trust Fund Proration Prevention Account in the State Treasury.
• Establishes a separate fund to prevent proration of ETF appropriations; monies in this account are not subject to general appropriation except as provided.
• Funding: beginning Oct 1, 2008 and each Oct 1 thereafter, deposits 75% of the ETF ending balance that was unanticipated and unappropriated into the Proration Prevention Account; the Finance Director transfers this amount by Oct 15 each year.
• Withdrawals: allowed only to prevent proration; Governor must certify that proration would occur and notify the Legislature; withdrawals limited to the amount necessary to avoid proration.
• Legislative approval: withdrawals require a two-thirds recorded vote of each chamber.
• Repayment: monies withdrawn must be repaid as directed by the Legislature, but repayment can be suspended in years when proration occurs and is not required in a year that would cause proration.
• Interest: interest earned stays in the Proration Prevention Account and is subject to the provisions of this section.
• Reversion: any amount in the account exceeding 10% of the preceding year's ETF appropriations reverts to the ETF for public education support.
• Effective date: becomes effective on the first day of the third month after passage and governor approval.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Education Trust Fund