HB465 Alabama 2020 Session

Summary

Primary Sponsor

Arnold MooneyRepresentative

Republican

Session

Regular Session 2020

Title

General Fund Budget Reserve Fund, transfer of monies to the fund, withdrawal and use of amounts deposited into the fund provided for

Summary

Creates the General Fund Budget Reserve Fund and sets rules for depositing from unanticipated General Fund balances and for withdrawals to cover proration or other needs.

What This Bill Does

Establishes a new General Fund Budget Reserve Fund in the State Treasury with deposits and interest governed by the act. Beginning Oct 1, 2020, and each year thereafter, 20% of the prior year's unanticipated and unappropriated General Fund ending balance is transferred into the reserve if the fund balance is under $100 million, with the transfer completed by Nov 15. Withdrawals are generally limited to preventing proration (Governor certifies; excess withdrawals must be returned within 30 days after the fiscal year) and can also occur via a two-thirds vote to fund revenue shortfalls, state employee pay raises/bonuses, or unanticipated obligations, but only if the prior-year end balance is at least $50 million.

Who It Affects

• State government finances (General Fund and the new Budget Reserve Fund) by defining how money moves in, stays, and can be withdrawn.
• State leaders and lawmakers (Governor, Comptroller, Finance Director, and Legislature) by assigning duties for certification, transfer timing, notification, and approval of withdrawals and supplemental appropriations.

Key Provisions

• Creates the General Fund Budget Reserve Fund in the State Treasury; funds in the reserve accrue and are not withdrawable except as allowed by the act; interest stays in the fund.
• Beginning Oct 1, 2020 and each fiscal year thereafter, transfer 20% of the General Fund's ending balance from the prior year that was unanticipated and unappropriated into the Budget Reserve Fund, by Nov 15, only if the reserve balance is under $100 million.
• Withdrawals to prevent proration require Governor certification and notification to the Comptroller and Legislature; withdrawals are limited to the amount needed to avoid proration and any excess must be returned to the fund within 30 days after the end of the fiscal year.
• Additional withdrawals may be made via an independent supplemental appropriation bill with a two-thirds vote in each chamber to fund: (1) revenue shortfalls, (2) pay raises or bonuses, (3) unanticipated obligations, but only if the prior year's end balance in the Budget Reserve Fund is at least $50 million.
• No funds may be appropriated under the supplemental mechanism until the Budget Reserve Fund balance at the end of the previous fiscal year is $50 million or more, and such appropriations follow specified budgetary provisions (Sections 41-4-80 through 41-4-96 and 41-19-1 through 41-19-12).
• The act becomes effective immediately upon passage and approval by the Governor.
• Definitions establish how Ending Balance and Beginning Balance are calculated for the General Fund (excluding reversions and other funds).

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Appropriations