Tennesseethe Journal the Weekly Insiders Newsletter on Tennessee Government, Politics, and Business Vol
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TennesseeThe Journal The weekly insiders newsletter on Tennessee government, politics, and business Vol. 46, No. 12 March 20, 2020 Virus fallout fears cause Lee to slash $900M from spending plan In less than a week, Republican leadership in the At those projections, no major cuts were required to General Assembly went from downplaying the need to close out the books through the end of this budget year, take drastic steps in response to the spreading coronavi- and the governor’s office directed $350 million in sur- rus, to jamming through a bare-bones annual spending plus collections to the rainy day fund and other emer- plan and leaving on a recess of at least 75 days. gency reserves. The plan for the 2020-2021 budget year A week earlier, there were 18 confirmed COVID-19 involved dialing back or eliminating most of the propos- cases in the state. As lawmakers rushed to wrap up busi- als Lee had outlined in his State of the State address, ness late Thursday, that number had jumped to 154 including $454 million in recurring programs and $399 people and was rising. Gov. Bill Lee and several mayors million in one-time spending. declared states of emergency, schools were told to shut Gone are Lee’s plans to deposit $250 million into a down, and Tennesseans were urged to engage in social new mental health trust fund, about $70 million for a distancing to slow the spread of the virus. literacy initiative aimed at students in kindergarten through second grade, and $58 million to fund half of House Speaker Cameron Sexton (R-Crossville) and what had been planned to be a 4% raise for teachers. Lee Senate Speaker Randy McNally (R-Oak Ridge) did add another $100 million in grants to be split up announced the Capitol complex would be closed to the between cities and counties across the state, doubling public — including to lobbyists — and that the General the amount he had initially proposed. Assembly would focus on legislation critical to passing the budget. That meant consideration of other high-pro- House Republicans are keen to describe the new file proposals like getting rid of handgun carry permit spending plan as a “preliminary” budget as they hold requirements, enacting sweeping restrictions on abor- out hope the economic and health fallout won’t be as tions, or even making the Bible the official book of Ten- bad as feared so they will be able to return in June and nessee would fall by the wayside. restore some of the reductions. Their Senate counter- parts appear more pessimistic, with some warning that After some initial disagreement over whether to a return later this year would more likely be accompa- adjourn the session following the budget’s passage (the nied by a need to make deeper cuts. preference of Senate leadership), a deal was struck to Vouchers versus teacher pay. Public school instead call a recess until June 1. The move allows law- teachers were upset at Lee’s insistence on retaining $40 makers to cling to the hope that some of their pet bills million in funding for the first year of his controversial could yet be heard before this summer’s campaign sea- school voucher program instead of dedicating the son gets going in earnest. money to mitigate the cuts in public school salaries. The By not adjourning sine die, lawmakers will be bound House Republican Caucus met behind closed doors for by an in-session fundraising ban until May 15, though 75 minutes on Thursday, in part to urge members not to that restriction is less stinging for incumbents as the have a repeat of the floor fight over school vouchers that dicey economic outlook likely means campaign dona- roiled the chamber last year. tions won’t exactly be flowing freely this spring. Majority Leader William Lamberth (R-Portland) The budget. Finance Commissioner Stuart insisted afterward that no decisions were made during McWhorter warned lawmakers this week the economic the closed-door meeting. He noted the funds in question fallout from the coronavirus will likely have Tennessee’s are earmarked for reimbursing public schools in Nash- economy sliding into recession in the budget year start- ville and Shelby County for students taking the voucher ing July 1. The administration reduced the growth rate to go to private schools, meaning a redirection of the for the current budget year from 3.45% to 2.5% and the money would only mean a loss in funding for those growth for the upcoming fiscal year from 3.1% to zero. school districts and not a cancellation of the voucher THE TENNESSEE JOURNAL (ISSN 0194-1240) is published weekly except for one week in June, one in September, and Christmas week by M. Lee Smith Publishers®, a divi- sion of BLR®,100 Winners Circle, Suite 300, Brentwood TN 37027, 615/373-7517 or 1-877-826-5297. Periodicals postage paid at Franklin TN and at additional mailing offices. POSTMASTER: Send address changes to THE TENNESSEE JOURNAL, P.O. Box 5094, Brentwood TN 37024-5094. Copyright 2020 M. Lee Smith Publishers, a division of BLR. Photocopying or reproducing in any form in whole or in part is a violation of federal copyright law and is strictly prohibited without the publisher’s consent. Editor: Erik Schelzig ([email protected]) • Vice President/Legal: Brad Forrister • Editorial Coordinator: Savannah Gilman program. An effort to amend the budget bill to remove terms of per capita income), the legislature must the voucher funding was defeated in the House while acknowledge that fact in a separate bill addressing no the governor watched the debate from the gallery. other subject. Skittish House Republicans held a closed- School’s out for the summer? The governor this door caucus meeting about the prospects of busting the week encouraged public schools around the state to cap earlier this session, but political concerns appeared close until at least the end of the month. Several districts to have waned by Thursday when it passed 89-1. have already announced they will remain shuttered into All things being equalized. The Tennessee April and faced the possibility they won’t be able to re- Chamber of Commerce and the state chapter of the open at all before the academic year ends in May. National Federation of Independent Business pushed Lawmakers passed sweeping changes to ease the back hard against an effort to pass a bill to declare prop- potential burden on the education system. They include erty assessments under appeal would no longer be eligi- waiving the requirement for schools to administer the ble for equalization. About 5,000 such appeals occur state’s assessment tests, eliminating the condition that across the state each year, according to the comptroller. districts provide at least 180 days of instruction to qual- Sen. Kerry Roberts (R-Springfield) said the change ify for state funding (most were about 120 days into the was necessary because a Memphis law firm (not identi- year before closing), and exempting seniors from pass- fied by the lawmaker, but widely understood to be ing a civics exam as a prerequisite for graduation. Evans Petree PC) in recent years “has upset the way Schools will still be able to voluntarily conduct stan- things were being done.” Opponents argued the change dardized testing, but only results that improve the aver- would undo a 1984 ruling by the State Board of Equal- ages of schools, teachers, or students will be counted. ization that “property in Tennessee is required to be val- ued and equalized according to ‘Market Value Theory.’” Electronic meetings. The crisis didn’t completely The business groups also questioned the urgency of undo inter-chamber discord. A bill to allow local gov- trying to make the change without hearing from critics ernment entities to hold electronic meetings during the as part of the slate of “mission critical” bills to get the pandemic failed amid disagreements about how strict General Assembly in a posture to quickly pass the bud- the guidelines should be. The Senate wanted to limit get and leave town. Roberts argued the change is neces- such meetings to times when the governor has declared sary to prevent a loss of revenues for local governments a state of emergency and require a reasonable effort to through the appeals process, the brief window for which be made to allow public access. The House wanted to opens in June. have local governing bodies decide when electronic meetings were needed and didn’t specify whether a Despite being barred from the Cordell Hull Building, stream of proceedings had to be live. The governor will the business lobbies were able to turn up the heat on now try to sort it all out through an executive order. lawmakers, with the NFIB vowing to place the floor votes on its annual report to members. When the bill Marketplace facilitators. Both chambers quickly came up for a vote on the Senate floor on Wednesday, approved legislation to expand the state’s online sales Roberts blasted what he called a “tremendous amount tax to cover goods sold through so-called marketplace of misinformation” circulated about the bill. But he facilitators like Amazon. The measure scheduled to go agreed to withdraw the measure until after the recess so into effect on Oct. 1 is projected to generate $85 million he could better explain his reasoning to colleagues. in state revenues for the remainder of the upcoming budget year, and $113 million annually after that. Local- Legislative races option sales taxes will be collected on the basis of the Conservative hardliners Daniel, Holt address from where the items were ordered, netting an estimated annual gain of $38 million per year for cities won’t seek re-election to state House or county governments.