The Tennessee General Assembly came to a close on Tuesday after legislators cut the sales tax on food by a half cent.

Proponents said it would save taxpayers $41 million per year.

BEP 2.0. Education reforms initiated by Gov. Phil Bredesen will send over $500 million in new state funding to local education authorities and institute new accountability measures for LEA’s and for Tennessee’s education colleges.

The state will now assume 75 percent of the costs of education. The changes are funded by a 40-cent-per-pack increase in Tennessee’s cigarette tax. Another two-cent rise will go to trauma centers like Erlanger Medical Center.

The state will have another sales tax holiday over the Easter weekend in 2008. During the state’s two previous sales tax holidays, taxpayers have saved approximately $30 million, officials said.

Legislation was passed to provide over $3.6 million in property tax relief for senior citizens by increasing their annual income eligibility limit and the threshold on home values eligible for relief under the Property Tax Relief Program for Elderly and Disabled Homeowners.

A bill passed extending property tax relief to veterans that are permanently and totally disabled due to service-connected injuries. The General Assembly’s Fiscal Review Committee estimates that at least 2,150 Tennessee veterans will qualify for an annual tax break of $845 on average.

An additional $250 million was put into the state Rainy Day Fund, bringing it to $750 million.

Funding was approved for new district attorneys and public defenders across the state, strengthen sentences for gun crimes and gang crimes, providing $1 million to improve the services provided by the Tennessee Department of Veterans Affairs; increasing the payment for in-service training for firefighters to the level given police officers; and giving state employees a three percent pay raise and increasing the state contribution to their 401(k) accounts to $50 a month.

A community enhancement grant program was put in place to provide funding to volunteer fire departments, summer job programs, public libraries, senior citizens centers and other worthy community projects.

Gov. Bredesen applauded the work of the 105th General Assembly, calling the achievements of the legislative session the "culmination of four years of hard work, tough choices and commonsense governance."

"We proved that we can manage in the tough times. This session proves we can maintain our discipline in the good times," Bredesen said. "Our record funding for education and the rainy day reserve are smart investments in the future of Tennessee - investments that we will leverage to set higher standards for educational performance and greater accountability for results."

While he said the work of the General Assembly "touched on all aspects of state government, from economic development and corrections to health and homeland security," Bredesen highlighted "four major areas of improvement":

Education -
BEP 2.0: Reforms the Basic Education Plan for school funding, putting the state on a course toward sustainable and equitable improvement in school funding and school progress accountability.
Pre-K: $25 million in new money to fund 250 additional classrooms, bringing the total investment to $95 million and as many as 779 classrooms statewide.
Lottery Scholarships: Increases the scholarship for four-year colleges and universities to $4,000 to help keep pace with the rising cost of college tuition.

'Rainy Day' Savings -
Record $250 million for the state's Revenue Fluctuation Fund, lifting the fund to a record $750 million in savings.
Bond Rating: Builds state's credentials toward a return to Triple-A credit rating.

Public Health -
Cigarette Tax Increase: $229.3 million for education and agriculture enhancement programs; $9.9 million for the state's trauma care centers; and an important new impediment to cigarette smoking in Tennessee.

Workplace Smoking Ban: The biggest step in smoke-free legislation that any tobacco state has ever taken to improve the health and lives of thousands of citizens.

Public Safety -
Crime Package: $38 million in new money for important improvements to the state's criminal sentencing laws and other programs with a goal of keeping criminals off Tennessee streets.

Governor Phil Bredesen applauded the work of the 105th General Assembly, which today completed its business with passage of the Fiscal Year 2007-2008 budget, calling the achievements of the legislative session the "culmination of four years of hard work, tough choices and commonsense governance."

The General Assembly's last major act of the session was to approve Bredesen's budget proposal, a plan that includes historic investments in education and substantial new reserve funding designed to ensure the future fiscal stability of the state.

"We proved that we can manage in the tough times. This session proves we can maintain our discipline in the good times," Bredesen said. "Our record funding for education and the rainy day reserve are smart investments in the future of Tennessee - investments that we will leverage to set higher standards for educational performance and greater accountability for results."

While the work of the General Assembly touched on all aspects of state government, from economic development and corrections to health and homeland security, Bredesen highlighted four major areas of improvement:

Education -
BEP 2.0: Reforms the Basic Education Plan for school funding, putting the state on a course toward sustainable and equitable improvement in school funding and school progress accountability.
Pre-K: $25 million in new money to fund 250 additional classrooms, bringing the total investment to $95 million and as many as 779 classrooms statewide.
Lottery Scholarships: Increases the scholarship for four-year colleges and universities to $4,000 to help keep pace with the rising cost of college tuition.

'Rainy Day' Savings -
Record $250 million for the state's Revenue Fluctuation Fund, lifting the fund to a record $750 million in savings.
Bond Rating: Builds state's credentials toward a return to Triple-A credit rating.

Public Health -
Cigarette Tax Increase: $229.3 million for education and agriculture enhancement programs; $9.9 million for the state's trauma care centers; and an important new impediment to cigarette smoking in Tennessee.

Bredesen Praises Advances As Legislative Session Ends

Page 2

Workplace Smoking Ban: The biggest step in smoke-free legislation that any tobacco state has ever taken to improve the health and lives of thousands of citizens.

Public Safety -
Crime Package: $38 million in new money for important improvements to the state's criminal sentencing laws and other programs with a goal of keeping criminals off Tennessee streets.

In addition, the General Assembly voted to expand upon the governor's budget proposal to include several tax relief measures, including a permanent half-cent reduction in the state's 6-cent tax on food and a one-time three-day sales tax holiday March 21-23, 2008.

"Working Tennesseans and their families will benefit from these tax-relief initiatives, and I applaud the General Assembly for their work in this regard," Bredesen said.

Democratic Caucus Chairman Senator Joe Haynes, D-Goodlettsville, said. “The Caucus kept its sights set on doing the people’s business, and we did a number of things that will help Tennesseans and make our state’s future a little brighter.

"In all, the Senate Democratic Caucus accomplished the goals it set at the beginning of session. We take seriously our commitment to the people of Tennessee, and we fulfilled our responsibility to them.

“We balanced the state budget and made smart investments. We’re proud that we were able to do some good things. This was a good session for the Democratic Caucus and a good session for Tennesseans as a whole.”