Alabama Senate Committee Approves Education Budget with One-Time Bonus for Retirees

The $12.4 billion education budget package includes a $1 per month bonus for each year of service for retired education employees.

Apr. 2, 2026 at 1:06pm

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The Alabama Senate Finance and Taxation Education Committee has approved the $12.4 billion Education Trust Fund budget for fiscal year 2027, which includes a one-time bonus for education retirees. The bonus will provide $1 per month for each year of service, meaning a retiree with 25 years of service would receive a $300 bonus before taxes. The House version of the budget did not include any bonus funding for retirees.

Why it matters

Many education retirees in Alabama have incomes at or below the federal poverty level, and this one-time bonus is seen as a step towards providing much-needed financial relief. However, retirees have been asking for a substantial cost-of-living adjustment (COLA), which they have not received since 2007.

The details

The $32.3 million allocation for the retiree bonus will come from any excess tax revenue at the end of the 2026 fiscal year, rather than directly from the $10.5 billion Education Trust Fund budget. The Senate committee also added language to prohibit colleges and universities from setting dual enrollment or early college credit-hour rates lower than what the Alabama Community College System charges.

  • The Senate Finance and Taxation Education Committee approved the FY27 education budget on Wednesday, April 2, 2026.
  • The Senate is expected to take up the budget on the Senate floor on Thursday, April 3, 2026.
  • The $32.3 million for the retiree bonus will come from any excess tax revenue at the end of the 2026 fiscal year, which is September 30, 2026.

The players

Arthur Orr

The Republican senator from Decatur who is the Education Budget Chairman and sponsor of Senate Bill 380, which includes the one-time bonus for education retirees.

Wendy Lang

The executive director of the Alabama Education Retirees Association, who expressed appreciation for the bonus but said retirees will continue to push for a substantial cost-of-living adjustment (COLA).

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What they’re saying

“We're very appreciative. We were hoping for more, but we will continue to push toward our ultimate goal: a substantial COLA.”

— Wendy Lang, Executive Director, Alabama Education Retirees Association

What’s next

The Senate is expected to take up the $12.4 billion education budget package, including the one-time retiree bonus, on the Senate floor on Thursday, April 3, 2026.

The takeaway

While the one-time bonus for education retirees is a welcome relief, it does not address the long-standing issue of retirees lacking a cost-of-living adjustment. The Alabama legislature will likely continue to face pressure from retiree groups to provide a substantial COLA to help those living at or below the federal poverty level.