SB101 Alabama 2023 Session

Summary

Primary Sponsor

Arthur OrrSenator

Republican

Session

Regular Session 2023

Title

To amend Sections 29-9-2, 29-9-3, and 29-9-4, Code of Alabama 1975, as last amended by Acts 2022-139 and 2022-358 of the 2022 Regular Session, and Sections 29-9-5, Code of Alabama 1975, relating to the Education Trust Fund Rolling Reserve Act, to provide additional definitions; to provide further for annual Education Trust Fund appropriations; to provide further for the distribution of revenues received in excess of appropriations; to create the Educational Opportunities Reserve Fund and provide for the funding and appropriations from the fund; to revise the allowable uses of withdrawals from the Budget Stabilization Fund to eliminate temporary loans for repairs; and to repeal obsolete Section 29-9-2.1 of the Code of Alabama of 1975.

Summary

SB101 updates Alabama’s Education Trust Fund rules by creating an Educational Opportunities Reserve Fund, clarifying annual appropriations and excess revenue distributions, and tightening how reserve funds are used and repaid.

What This Bill Does

It adds new definitions and provisions for annual appropriations and for distributing excess Education Trust Fund revenues. It creates the Educational Opportunities Reserve Fund and sets when and how money can be taken from it for one-time educational purposes. It revises how the Budget Stabilization Fund and related reserves can be used, including proration rules and emergency funding with repayment requirements. It repeals an obsolete provision and sets the act’s effective date.

Who It Affects

• Public schools and higher education institutions in Alabama, which receive funding from the various Trust Fund reserves and from the Advancement and Technology Fund according to the plan in SB101.
• State officials (Governor, Director of Finance, Legislative Fiscal Officer, State Comptroller) who certify revenue projections, proration, and fund transfers.
• Insurance providers and public schools or higher education institutions that may recover emergency repair funding from insurance settlements and must repay borrowed emergency funds.
• Organizations and programs that rely on one-time funding from the Educational Opportunities Reserve Fund for new or expanded educational opportunities.

Key Provisions

• Creates the Educational Opportunities Reserve Fund with a requirement that its balance reach at least $300,000,000 before any appropriations can be made for its purposes.
• Excess Education Trust Fund revenues are allocated after funding the Budget Stabilization Fund: 50% to the Education Trust Fund Advancement and Technology Fund (up to $1 billion per year) and 20% to the Educational Opportunities Reserve Fund; any remaining excess is left in the Education Trust Fund as nonrecurring revenue.
• Advancement and Technology Fund distributions are split between public schools and higher education according to a Legislative Officer-certified percentage; funds may be used for nonrecurring, one-time expenses such as repairs, capital outlay, instructional support, facilities insurance, transportation, security, and technology, but not as debt service pledge; balance and allocation rules apply.
• Budget Stabilization Fund withdrawals are limited to preventing proration, with Governor certification and repayment requirements; emergency withdrawals are allowed for natural disasters with limits (up to 10% of the current balance; repaid from insurance settlements or other funds within two years with 8% interest on any remaining amount).
• Reforms to the fiscal year appropriation cap (and secondary spending limit) to determine annual appropriations, and allowances for temporary transfers from the Budget Stabilization Fund to offset shortfalls when cap is lower than prior-year appropriations.
• Repeals obsolete Section 29-9-2.1 and establishes an effective date (first day of the third month after passage).

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