General Assembly hears State of the State Address
Governor unveils budget proposal
Governor Bill Haslam delivered his annual State of the State Address to a joint convention this week, unveiling his budget for the 2013-2014 fiscal year. Haslam addressed multiple issues during the State of the State, the most prominent of which include job recruitment and workforce development, investments in both K-12 and higher education, lowering taxes, and a continued push to make government more efficient and effective.
House Republican lawmakers were pleased with the governor’s priorities, and look forward to moving his agenda forward through the legislature.
Among the key points in the governor’s speech was a focus on balanced budgets, low taxes, and fiscal responsibility. As Washington, D.C. and other states are mired in partisan gridlock with out of control spending, the governor emphasized that Tennessee has made responsible decisions that will continue to ensure the state is positioned to be a leader in country on jobs.
Job Recruitment and Workforce Development
Building on the success of legislation passed during the Republican-led 107th General Assembly, Governor Haslam’s $32.6 billion balanced budget makes major investments in job recruitment and workforce development, including:
• $16.5 million budgeted to provide technology and equipment related to workforce development programs for community colleges and technology centers across the state.
• A new technical education complex at Northeast State Community College in the Tri-Cities to help train for manufacturing related jobs.
• A much-needed lab building at Nashville State Community College to help train the next generation of students in Middle Tennessee.
• A new state-of-the-art technology center in Smyrna that will be managed in conjunction with Nissan to provide training for area businesses looking for high-skilled employees.
In addition, the Governor’s budget includes strategic capital investments statewide that will help fund programs to ensure Tennesseans have the skills needed to obtain well-paying, 21st century jobs after graduation.
K-12 and Higher Education Investment
A large portion of Monday’s State of the State Address was committed to improving education, an issue that both the Governor and Republican legislators have made a priority. The budget proposal calls for:
• 100% funding for the Basic Education Program (BEP) formula.
• A $76.9 million increase in K-12 public school funding, including salary increases for K-12 teachers.
• A school choice program that will allow low-income families who have kids in the lowest-performing schools to attend other schools.
• $307.3 million committed for capital improvements (buildings and infrastructure) at our higher education institutions.
• The investment in an online university focused on improving affordability and access to higher education for the more than 800,000 Tennesseans that have obtained some college credit but have not yet graduated.
In addition to these education proposals during the State of the State, Governor Haslam also announced a strategic initiative called “Drive to 55”. This new initiative, the goal of which is to ensure Tennessee has the best-trained workforce in America, will seek to increase the number of Tennesseans that have earned an Associates degree or higher from 32% to 55% by the year 2025.
Tax Cuts
Multiple tax cuts were passed by Republicans during the 107th session of the General Assembly, including eliminating the gift tax, lowering the sales tax on food, and phasing out the death tax. Similar to last year, the Governor’s 2013-2014 budget includes additional tax cuts for Tennesseans, including:
• A further reduction of the sales tax on groceries to a flat 5%.
• A cut to the Hall Tax which will raise the income exemption level from $26,000 to $33,000 for individuals and $37,000 to $59,000 for joint filers.
• A plan to fully fund the property tax relief program to help low-income seniors, veterans, and the disabled.
• A further reduction of the death tax that raises the income exemption level from $1.25 million to $2 million.
These tax cut proposals by Governor Haslam reflect an agreement with Republican legislators to prioritize the needs of Tennesseans in a fiscally responsible manner that encourages job growth statewide.
Other Budget Highlights
Other highlights of Governor Haslam’s 2013-2014 budget include:
• A plan to spend $48 million in Corrections to compensate our local jails for housing more state prisoners.
• A proposal to streamline and better utilize the Criminal Gang Enhancement law, making our streets safer.
• A commitment to add $100 million to the state’s Rainy Day Fund.
• A proposal for worker’s compensation reform that will focus on fairness in the system for both the employee and the employer.
• Upgrading nearly 200 case manager positions in the Department of Children’s Services.
• $4.3 million for the Montgomery County veteran’s home.
• $8 million for a statewide tourism fund to support the work of the tourism commission.