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Committee OKs budget that gives state employees 3.5% raise

MONTGOMERY (AP) — State employees in Alabama would receive a 3.5 percent pay hike and retirees a one-time bonus under a state operating budget approved by a House committee Wednesday.

The House Government Appropriations Committee approved a $1.8 billion General Fund budget Wednesday that includes money to pay for the pay raise. The spending plan also provides funds to hire 100 new state troopers and to cut down the number of people on waiting lists to receive state services provided for the mentally retarded.

The budget passed the committee on an apparently unanimous vote and now goes to the full House for debate, possibly as early as next week.

The budget was about $32 million more than the spending plan proposed by Gov. Bob Riley with more than half of that going toward the pay raise for state workers.

The committee passed a separate bill that calls for the 3.5 percent raise this year and promises another 3.5 percent pay hike next year.

"I feel good about this," said Mac McArthur, executive director of the Alabama State Employees Association. "In an extremely lean General Fund budget, they recognized the value of state employees."

The pay raise would apply to most non-education employees. Another committee earlier approved a 7 percent raise for teachers.

Rather than getting a pay raise, retired state workers would get a one-time bonus in December that would be about $360 for a worker who retired after 30 years service.

The budget sponsor and committee chairman, Rep. John Knight, D-Montgomery, said taxes that support the General Fund budget have remained relatively static. He said the budget provides level funding, or small increases, for most agencies. He said no layoffs would be required, but at the same time there is not much money for new initiatives.

The proposed budget contains about $70 million more for Medicaid, but Knight said that will mostly just maintain the current services because of the rising costs of medical care. He said there is about $7 million in the Medicaid budget that could be used to add new services.

The budget does not include funding for new prisons to address the overcrowding problem in the Alabama Department of Corrections, which is currently housing about twice as many inmates as the system was designed to hold.

Knight said he is working with the governor to find funds to build new prisons. Prisons officials have discussed the need for both a new women's prison and a new prison for male inmates.

"We've got to address the issue of prison overcrowding. There's just not room in the operating budget," Knight said.

Finance Director Jim Main expressed concern there was not room in the budget for conditional funds if needed for corrections.

"We don't know how many prisoners we are going to have," Main said.

While the budget maintains level or increased funding for most agencies, it cuts the governor's contingency fund by $500,000, from $750,000 to $250,000. This is a fund the governor can spend however he pleases.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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