The vote was the first major decision in a late night of haggling over a proposed $5.74 billion education budget for 2014, which the House approved in a separate 84-16 vote.
Lawmakers are expecting revenue for the education budget to come in about $170 million higher than last year, a respite from years of austerity. Before the 2008 recession, the education budget had $6.7 billion.
At the opening of the legislative session, both political parties wanted a pay raise for K-12 education employees, who haven't seen an increase since before the recession. Republican Gov. Robert Bentley asked for a 2.5 percent increase. Democrats said they wanted more. A House committee settled on 2 percent, saying the budget didn't have room for more.
The bill creating the 2 percent pay raise also included a $5 million plan to provide liability insurance for the state's teachers.
“It puts $500 in a teacher's pocket,” said Rep. Jay Love, R-Montgomery, the bill’s sponsor. The program, Love said, amounted to an additional 1 percent increase for educators.
That plan took a beating from Democrats on the House floor. The Alabama Education Association, the state's largest professional association for teachers, provides liability coverage for its members. Democrats said the plan was designed to attack AEA, not to provide a service teachers need.
"Do you know how many textbooks $5 million can buy?" asked Rep. Joe Hubbard, D-Montgomery.
Democrats called for the $5 million to be added to the proposed pay raise or spent on other educational programs.
Love said the insurance program would provide teachers with a benefit no other state employee must pay out-of-pocket.
Rep. Richard Lindsey, D-Centre, offered an amendment that would have set the pay raise at 5 percent, covering not only K-12 but also higher education employees.
Lindsey said the state could afford that raise if it accepted the revenue estimates from Bentley's office — about $20 million higher than the House estimates, eliminated the liability insurance program and repealed the Alabama Accountability Act.
That act, passed in late February, sets up a tax credit for parents of children in “failing” public schools, which would reimburse them around $3,500 per year to send their children to private schools or non-failing public institutions.
Lindsey claims the act will cost the state $66 million next year. Love's projections put the cost between $50 million and $60 million.
The House rejected the 5 percent raise in a 62-37 vote, largely along party lines. Rep. Alvin Holmes, D-Montgomery, later proposed a 3 percent percent pay raise, with 1 percent of the raise from conditional appropriations — in other words, a pay raise that would kick in if revenues are higher than projected. The House rejected that proposal.
Love said neither proposal was a wise move from a fiscal standpoint. He said pay raises could have been higher if not for rising retirement costs and the need to make payments on a $437 million loan from the state's Rainy Day Fund, taken out years ago.
"We're paying for financial mismanagement that we inherited," he said.
Despite the debate over the liability bill, the pay raise measure passed by a wide margin. Democrats said they'd rather approve a 2 percent raise than none at all. Still, Minority Leader Craig Ford, D-Gadsden, called the raise "a slap in the face" to teachers.
"It's just their way to win the teachers over, but they're not going to be fooled by this," he said.
After the pay raise vote, the House went on to debate the full education budget, which would keep most agencies at the same funding levels they saw last year. That budget includes a 62 percent increase for the state’s pre-kindergarten program, from $19 million in 2013 to $31 million in 2014. Advocates hope to expand the program to all of the state’s four-year-olds within 10 years.
The pay raise and the overall budget will now move on to the Senate for a vote.
Capitol & statewide reporter Tim Lockette: 256-294-4193. On Twitter @TLockette_Star.