The Alabama Legislature convened on Tuesday for the 2026 Regular Session. As this is the final year of the current 4-year term, all legislative seats are up for election this November. To allow incumbents time to campaign ahead of the May primaries, the session is expected to move quickly – likely adjourning before the constitutional deadline of April 27.
Lawmakers return Tuesday for their fourth legislative day out of a maximum of 30.
Governor Ivey Outlines Agenda in Final State of the State
In her final State of the State address on Tuesday, Gov. Kay Ivey urged the Legislature to maintain the state’s current momentum. Highlighting recent successes in economic development and education, she noted that the state’s conservative budgeting has provided a sufficient cushion to offer raises to both educators and state employees this year.
Key Legislative Priorities:
- Education Choice: Increasing CHOOSE Act funding (Alabama’s education savings account program) from $180M to $250M. This expansion would support approximately 10,000 students enrolled in participating schools.
- Cost-of-Living Adjustments: Providing a 2% raise for all education and state employees.
- Workforce Development: Addressing the state’s labor participation rate (57.2%), which remains among the lowest in the Southeast.
- Rural Healthcare: Strengthening the Rural Health Transformation Program using $203M in federal funding allocated via the “One Big Beautiful Bill.”
2026 Budget Proposals: “Changing Economic Times”
Gov. Ivey’s proposed budgets for Fiscal Year 2027 reflect a shifting economic landscape. While Alabama remains in a strong position due to past “rainy day” savings, the state faces the exhaustion of federal COVID-19 stimulus funds and a cooling market.
Education Trust Fund (ETF)
Proposed by Rep. Danny Garrett, the ETF is set for a record $10.956 billion (a $569M increase).
- Key Increases:
- $334.85M for K-12 elementary systems.
- $103.7M for four-year colleges and universities.
- $35.77M for the Community College System.
- $50M for enhanced school safety initiatives.
- The Health Insurance Challenge: The teachers’ health insurance plan (PEEHIP) requested $380M to cover rising costs. Lawmakers signal they may only fund half, likely requiring the board to use reserves or increase member premiums.
- Pay Raises: A proposed 2% salary increase for education employees is estimated to cost $100M.
ETF Supplemental
This “supplemental” bill allows the state to spend excess money from the current year immediately. Highlights include:
- $100M for the CHOOSE Act Fund (School Choice).
- $66.5M for school bus purchases and debt retirement.
- $45M for middle-grade literacy programming.
- $36.8M for university and community college deferred maintenance.
General Fund
Proposed by Sen. Greg Albritton, the General Fund is set at $3.69 billion, representing a $28.5M cut from the current year.
- Level Funding: Most judicial, legislative, and executive agencies will see their funding remain flat.
- SNAP Administrative Shift: A $40M increase is required to cover administrative costs for the SNAP program due to changes in federal requirements.
General Fund Supplemental
- $66M for energy infrastructure and industrial development.
- $34M in remaining COVID-19 stimulus for small business credit initiatives.
- $4.1M for the Alabama Court System.
AHSAA in the Legislature’s Crosshairs
The CHOOSE Act, passed in 2024, included a specific provision ensuring that students receiving these funds would not lose their athletic eligibility. However, the Alabama High School Athletic Association (AHSAA) disagreed, treating these funds as “financial aid” which typically triggers a one-year “sit-out” period for transfer students.
This led to a legal showdown last fall when Gov. Ivey and Speaker Ledbetter sued the association. They successfully won a temporary restraining order (TRO), which currently prevents the AHSAA from declaring those students ineligible while the lawsuit proceeds. Now, two major bills aim to bring more accountability and oversight to the organization.
Proposed Legislation:
- SB73 (Sen. Donnie Chesteen): This bill would fundamentally restructure the AHSAA’s governing body. It requires at least 50% of the board to be appointed by state leaders (the governor, speaker, president pro tempore, or lieutenant governor). Additionally, it would prohibit public K-12 schools from joining the AHSAA unless its rules are adopted under the Alabama Administrative Procedure Act, giving the Legislative Council oversight of its rulemaking process.
- “The Let the Kids Play Act” (Sen. Clyde Chambliss and Rep. Danny Garrett): Expected to be filed next week, this bill creates a legal recourse for parents if their children are denied eligibility due to CHOOSE Act participation. Gov. Ivey has identified this as a cornerstone of her 2026 agenda to ensure no family is “unfairly benched” for making educational choices.
Crime & Public Safety Bills Receive Committee Approval
Several high-profile bills regarding the death penalty and victim protections have advanced out of committee and are now headed for the House floor.
Expanding the Death Penalty
Rep. Matt Simpson has introduced two bills that would broaden the list of capital offenses in Alabama:
- Mass Casualty Risk (HB20): This bill makes a defendant eligible for the death penalty if they commit murder while knowingly creating a “great risk of death” to multiple people.
- Crimes Against Children (HB41): This bill would allow the death penalty for defendants accused of rape, sodomy, or sexual torture of a child under the age of 12.
“Trey’s Law”: Ending Silencing Agreements
Identical versions of Trey’s Law moved through both House and Senate committees this week (HB93 by Rep. David Faulkner and SB30 by Sen. Matt Woods).
- The Goal: The legislation prohibits the use of nondisclosure agreements (NDAs) in civil settlements involving human trafficking or sexual abuse.
- The Inspiration: The law is named after a victim who died by suicide in Texas, a tragedy attributed in part to the legal inability to speak out due to a restrictive settlement agreement.
Key Bills to Watch
App Store & Minor Safety (HB161)
Rep. Chris Sells’ HB161 targets digital safety by putting parents in control of app downloads on child devices.
- Age Verification: Requires app stores to verify user ages and link minor accounts to a parent or guardian.
- Parental Consent: App stores must obtain “verifiable parental consent” before a minor can download apps or when an app makes “significant changes” to its features or data usage.
- Enforcement: Authorizes the attorney general to pursue violations as deceptive trade practices against app store providers or developers.
SNAP Restrictions: Soda and Candy (SB57)
Sponsored by Sen. Arthur Orr, SB57 seeks to limit the use of Supplemental Nutrition Assistance Program (SNAP) benefits for non-essential items.
- The Mandate: The bill requires the Department of Human Resources (DHR) to request a federal waiver to prohibit the purchase of soda and candy with SNAP funds.
- Persistence: If the federal government denies the waiver, the bill requires the state to resubmit the request annually until approved.
Online Sales Tax Distribution Dispute (SB36 & SB37)
Sen. Greg Albritton has introduced these bills to stabilize the state’s Simplified Sellers Use Tax (SSUT) program. This comes in response to lawsuits from several large Alabama cities that argue the current flat 8% online tax distribution disadvantages them.
- The Conflict: Large cities claim they lose millions because online sales are distributed by population rather than where the purchase occurs.
- The Proposed Fix: To protect the General Fund from a “budgetary hole” if the courts rule against the current system, these bills would establish new exemptions for nonresident taxpayers and create a clearer refund mechanism for local taxes paid in different jurisdictions.
State Alignment with “Trump Accounts” (HB250)
Following the passage of the federal One Big Beautiful Bill (OBBB) in 2025, Rep. Danny Garrett is moving to align Alabama’s tax code with new federal savings incentives.
- Trump Accounts: The bill would exclude employer contributions to these new birth-to-retirement custodial accounts from an individual’s Alabama gross income.
- Education Loans: It would also make the state tax exclusion for employer-paid student loans permanent, providing long-term relief for workers whose companies help pay down their debt.
| Bill | Sponsors | Title | Last Action | Latest Version |
| AL 2026rs HB 259 |
Shaw | Stablecoin; license required for issuance or sale of stablecoins, payment, authorize use of payment stablecoin by governmental entities for contracting, Alabama Securities Commission to enforce and authorize, penalties provided (Financial Services (House)) | House, Jan 15, 2026: Pending Committee Action in House of Origin (Financial Services) | Introduced |
| AL 2026rs HB 252 |
Shaw | Campaign finance; campaign contributions required to be held in federally insured institution (Ethics and Campaign Finance (House)) | House, Jan 15, 2026: Pending Committee Action in House of Origin (Ethics and Campaign Finance) | Introduced |
| AL 2026rs HB 207 |
Wadsworth | Alabama Uniform Trust Code; amended to conform with Alabama Qualified Dispositions in Trust Act, limit property subject to creditors’ claims (Financial Services (House)) | House, Jan 14, 2026: Pending Committee Action in House of Origin (Financial Services) | Introduced |
| AL 2026rs HB 206 |
Wadsworth | Trusts; amend Alabama Principal and Income Act, permit trustee to adjust between principal and income (Financial Services (House)) | House, Jan 14, 2026: Pending Committee Action in House of Origin (Financial Services) | Introduced |
| AL 2026rs HB 104 |
Blackshear | Uniform Disposition of Unclaimed Property; allow finders to contract and locate State Treasurer property, account for digital assets | House, Jan 14, 2026: Read for the Second Time and placed on the Calendar (Financial Services) | Introduced |
| AL 2026rs HB 96 |
Pringle | Debtors homestead exemption; in bankruptcy cases; increase homestead exemption for seniors and disabled | House, Jan 14, 2026: Read for the Second Time and placed on the Calendar (Ways and Means Education) | Introduced |
| AL 2026rs HB 77 |
Paschal | Taxation and Revenue; disabled veterans’ homestead taxes inclusion in debt-to-income ratio under certain circumstances prohibited | House, Jan 14, 2026: Read for the Second Time and placed on the Calendar (Military and Veterans’ Affairs) | Introduced |
| AL 2026rs SB 130 |
Elliott | Taxation and Revenue; Homestead ad valorum taxes of certain veterans prohibited from inclusion in debt-to-income ratio under certain circumstances (Finance and Taxation General Fund (Senate)) | Senate, Jan 13, 2026: Pending Committee Action in House of Origin (Finance and Taxation General Fund) | Introduced |
| AL 2026rs HB 55 |
Hollis | Mortgages; require lenders to all mortgagors to make additional mortgage payments (Financial Services (House)) | House, Jan 13, 2026: Pending Committee Action in House of Origin (Financial Services) | Introduced |
