State Budgets: Alabama Governor Announces Education Proration and Budget Reductions January 3, 2009 Joseph Bishop-Henchman Joseph Bishop-Henchman Alabama Gov. Bob Riley (R) has announced hiring freeze (reducing state workers from 39,000 to 36,000); a ban on merit raises; travel curtailment; and a cut to spending in a targeted manner by 10 percent. Education, which faces a $795 million shortfall, will be cut across-the-board by 12.5%, partly offset to 9 percent by drawing down half of $437 million Education Rainy Day Fund. Alabama requires proration (across-the-board spending cuts) to access rainy day funds, and general proration has not yet been declared. In 2003, Alabama voters rejected Riley’s proposal to raise $1.2 billion per year by increasing property, income, corporate, and cigarette taxes and imposing an intangibles tax. More on Alabama here. Stay informed on the tax policies impacting you. Subscribe to get insights from our trusted experts delivered straight to your inbox. Subscribe Share Tweet Share Email Topics Alabama Tags State Tax and Spending Policy