Alabama tax revenues continue to trend toward more normal patterns after a wild post-pandemic ride. The Education Trust Fund, powered by state income and sales taxes, grew modestly, collecting 2.2% more than the previous year. Meanwhile, growth in the General Fund cooled but still posted an unusually high increase of 7%, boosted by high interest earned on state deposits and continued growth in tax revenue from online sales, insurance, and property taxes.

The General Fund (GF) supports non-education spending, while the Education Trust Fund (ETF) supports spending on K-12 schools, colleges and universities. From FY 2021 through FY 2023, the two funds saw unusual surges of growth related to post-pandemic economic conditions and shifting patterns of consumption.

In 2024, the GF maintained its winning streak. Thanks to budget surpluses, replenished stockpiles of rainy day reserves, and federal relief and investment funds deposited in state accounts, Alabama has a growing body of cash in its accounts, which earn interest. At the same time, interest rates have stayed high as the Federal Reserve tries to cool inflation. As a result, the state revenues from interest grew by more than $150 million, up to $557 million.

Scroll below or click this link to continue reading PARCA’s latest report, Alabama State Tax Collections, 2024: Increases, Decreases and Trends in the Revenue Supporting the State Government.

Today, the Business Education Alliance of Alabama (BEA) is releasing Alabama Can Improve Student Achievement and Prepare a Future Workforce: Here’s How-Part 2, a follow-up to the Governor’s Commission on Teaching and Learning’s report issued in December of 2023. The Alabama Legislature financially supported many of the Commission’s recommendations, and today’s release by the BEA follows up on what remains to be done.

The research for Alabama Can was conducted by the Public Affairs Research Council of Alabama (PARCA).

On January 18, 2023, Governor Kay Ivey issued Executive Order 730, establishing the Governor’s Commission on Teaching and Learning. The executive order charged the 13 Commission members with providing thorough and thoughtful recommendations for enhancing the quality of elementary and secondary education in Alabama.

The Commission met eight times, hearing from state and national educational leaders, as well as receiving input from the public. Based on the information gathered, the Commission issued a series of recommendations contained in a final report issued in December 2023.

Alabama Can Improve Student Achievement and Prepare a Future Workforce: Here’s How-Part 2 seeks to refocus attention on recommendations, particularly those supported by the Legislature, the Department of Education, and the State Board of Education, and which are showing results. Items examined include fully funding key academic initiatives, attracting and retaining teachers, improving the learning environment, and supporting students from early childhood to career.

As the report states, in the Spring of 2024, the percentage of Alabama 3rd graders scoring proficient on the state standardized test of English Language Arts (ELA) jumped by nine percentage points to 62%, a remarkable increase rarely seen in educational statistics.

Even more encouraging, economically disadvantaged third graders made even greater gains compared to the prior year, a 13-percentage point increase in ELA proficiency, up to 53%. That produced the smallest gap in proficiency rates between economically disadvantaged and all students since the test, the Alabama Comprehensive Assessment Program (ACAP), was launched in 2021.

That’s progress on educational disparity, a central challenge for Alabama, as highlighted in the Governor’s Commission’s report.

This progress did not occur randomly. It follows five years of committed policy from and sustained investment by the Governor, the Alabama Legislature, the Alabama Board of Education, and the Alabama Department of Education. That investment more than doubled the amount spent on K-3 reading instruction to over $140 million annually in support of the Alabama Literacy Act of 2019.

Joe Morton, the chairman and president of the Business Education Alliance of Alabama states, “This report proves that the right amount of funding spent on the right initiatives propels Alabama’s schools and future workforce forward at the speed necessary to keep Alabama’s economic engine running soundly.”

The report will be shared with Governor Kay Ivey, Lt. Governor Will Ainsworth, State Superintendent Eric Mackey, members of the State Board of Education, and each member of the Alabama Legislature.