Legislative Update – Week of March 11, 2019

Governor Outlines Budget and Legislative Priorities  

Last Monday evening, Governor Bill Lee outlined the priorities of his first budget proposal in his State of the State Address.  

Highlights of the $38.55 billion proposal are:  

  •  A $71 million pay raise for teachers across. 

  • $175 million in new funds to support teachers and students in our public schools. 

  • Doubling the amount of facility funding available to public charter schools. 

  • Establishing an independent state authorizer to approve high-quality charter schools. 

  • Creating the Tennessee Education Savings Account program which will provide approximately $7,300 to eligible students to attend private schools or receive alternative methods of instruction and remediation.   

  • Establishing the Criminal Justice Reinvestment Task Force to make communities safer by reducing recidivism through proposed legislative and budgetary changes. 

  • Increasing funding to the Electronic Monitoring Indigency fund to use GPS monitoring of low-risk, non-violent individuals instead of incarceration. 
  • Serving thousands of additional vulnerable Tennesseans by investing an additional $11 million into the Behavioral Health Safety Net and Regional Mental Institutes. 

For the press release on the State of the State Address, click here.  

For the complete budget proposal and supporting documents, click here.

Bills to Watch this Week

HB 1265 by Holt/SB 513 by Roberts – this bill would delete several state economic development incentive programs while also potentially exposing the proprietary information of companies that receive state incentives.

This bill is entitled the Fair Accountability and Clarity in Tax Subsidies Act.  While its stated intent relates to transparency, it would delete the following state incentives for job creation and economic development:  franchise tax credits: the job tax credit upon the creation of less than 25 qualified jobs; the job tax credit where the newly created position existed in this state less than 90 days prior to being filled; and some tax credits awarded to companies who establish a regional, national or international headquarters in Tennessee.  The bill would also make public certain tax information of participating companies that is currently confidential under state law.

Proponents and opponents of this bill are working on amendatory language which may be presented in committees next week, but the specifics are not known at this point.

The House bill is scheduled for a hearing in the House Business Subcommittee tomorrow at 3:00 p.m., and the Senate bill is scheduled for a hearing in the Senate Commerce & Labor Committee tomorrow at 1:00 p.m. 

HB 1089 by Whitson/SB 557 by Johnson – this bill would allow property owners to participate in local referenda on the question of annexation.

Under current law, only residents of an area that is subject to a proposed annexation are eligible to vote.

The House bill is scheduled for a hearing on Wednesday in the House Property and Planning Subcommittee at 11:00 a.m., and the Senate bill is scheduled for a hearing tomorrow in the Senate State & Local Government Committee at 10:30 a.m.

HB 733 by C. Johnson/SB 82 by Kurita  - this bill would require certain out-of-state sellers to collect and remit sales taxes to the department of revenue.

On June 21, 2018, the U.S. Supreme Court held that a state may require out-of-state sellers to collect and pay sales taxes on purchases within the state.  The 5-4 decision overturned a 1992 decision whereby a state was only authorized to require the collection and payment of sales taxes of sellers with a physical presence in the state.  If this legislation were to pass, it would generate hundreds of millions of tax dollars for the state and local governments, but it remains to be seen if any of these dollars will be earmarked for specific purposes or simply deposited into the state’s general fund.

The House bill is scheduled for a hearing the in the House Finance, Ways & Means Subcommittee on Wednesday at 11:00 a.m., and the Senate bill is scheduled for a hearing in the Senate Finance, Ways & Means Revenue Subcommittee tomorrow at 9:30 a.m. 

To see the status of all the bills being tracked by the Chamber, click here.

Connect With the Chamber