If payments aren't made soon the state will be forced to pay interest on the refund checks.
The situation may change soon, however, as Governor Bob Riley releases $100 million from the state's educational Rainy Day Fund. That money will not go directly to the people, but instead to the educational system to help maintain proration at its current level, around 9 percent.
By state law the education system has to be funded before refunds are sent out.
The plan is akin to a double-edged sword, however. It's good for taxpayers, but bad for next year's budget.
"If the Governor had not released the funds then schools would have had yet more cuts beyond what they had budgeted and many would have no where to go," said Dr. Joe Morton, State Superintendent of Education. "They would have no rainy day fund of their own to draw on and they really would have been in dire straights. So, what the Governor did today was help put off more cuts for schools."
Governor Riley's decision Monday was not a part of his original plan. He'd hoped to use half of the fund in 2009 and the other half in 2010. But with so many school systems struggling and only a month remaining until classes restart, Riley decided now was the time to move.
The governor declared proration in Alabama's education budget back in December, 2008 as a way to cut spending when revenues fall short of expectations. It was at that time he released $221 million, or roughly half, of the fund's value.
The cash pulled from the account Monday leaves a remaining balance of $116 million.
With the help of the federal stimulus money again in 2010 the Chairman of the Education Budget committees in both the House and Senate say there will be cuts and it will be tight.