As The 2025 Legislative Session Closes, Governor Lee Applauds Passage Of “Tennessee Innovates” Agenda

  • Tuesday, April 22, 2025

Tennessee Governor Bill Lee marked the close of the 2025 legislative session, which includes the passage of his $59.5 billion budget that invests in innovative approaches to serving Tennesseans.

“We’ve passed strategic legislative and budget measures to improve infrastructure, invest in education, strengthen our workforce, and solidify Tennessee’s position as a leader in next-generation nuclear energy,” said Governor Lee .“I thank the General Assembly for its partnership and continued commitment to responsible fiscal stewardship and innovation to improve the lives of the people we serve.”

Administration officials said, "The Lee agenda included passage of the Farmland Preservation Act to support Tennessee’s agriculture industry and ensure that family farms can be preserved well into the future. Notably, a total of 14 new Tennessee State Parks have been funded, setting the Tennessee record for the most state parks created by one administration.

"The roster of the budget and legislative priorities also dedicated $1 billion to the Tennessee Department of Transportation to address the state’s infrastructure needs in rural and urban communities and included significant investments in K-12 education, Tennessee’s nuclear energy ecosystem and conservation.

"The FY25-26 budget took steps to further enhance government efficiency by reducing more than 300 vacant positions from the state’s payroll."

Highlights from the Lee agenda, as outlined by the administration, include the following:

Economic Opportunity + Tax Relief

  • $35.6 million investment in Tennessee’s Rainy Day Fund, bringing Tennessee reserves to nearly $2.2 billion, the largest in state history
  • $7 million to expand the Tennessee Youth Employment Program to operate year-round, double its participation, and reach even more underserved communities
  • $45.8 million for Rural Development Grant Fund to enhance Tennessee’s rural and distressed communities through site development, community asset improvements, strategic planning and downtown revitalization
  • $25 million for FastTrack grants to recruit new business to Tennessee and support workforce development
  • $6.3 million to create a statewide Micro-Credentialing Program to develop short-term, targeted certifications that equip Tennesseans with high-demand skills identified by industry and state partners
  • $25 million to expand the RevV Program to connect private companies with Tennessee’s research institutions to drive research and development and job creation
  • $5 million to create TN Accelerates, a partnership between Tennessee Economic and Community Development and the Department of Labor and Workforce to create customized workforce training programs tailored to the specific needs of incoming and existing businesses
  • $5 million for the Tennessee Entertainment Commission to fund incentive grants to strengthen Tennessee’s music and film industry
  • $10 million for the Rural Grant Opportunity Fund to match funding for at-risk and distressed counties seeking state and federal grants
  • $10 million for the Small Business Innovation Research and Small Business Technology Transfer Matching Funds to match federal funds assisting Tennessee startups in securing competitive research and development grants

Infrastructure

  • $1 billion to the Tennessee Department of Transportation to address the state’s infrastructure needs, including expediting existing road projects and funding new projects across rural and urban Tennessee
  • $60 million for maintenance projects at Tennessee’s commercial and general aviation airports

Disaster Relief

During the special legislative session in January 2025, Gov. Lee and the General Assembly appropriated more than $450 million in direct disaster relief as part of a comprehensive plan to support ongoing recovery efforts and allow for proactive preparation for future emergencies. Governor Lee’s FY25-26 budget includes the following additional investments:

  • $275 million to construct a state-of-the-art TEMA Emergency Operations Center
  • $4 million to implement and maintain a Mesonet system, which will monitor weather-related and flooding threats in the state
  • $3 million to upgrade TEMA’s regional response vehicles

Education

During the special legislative session in January 2025, Gov. Lee and the General Assembly appropriated $198.4 million for teacher bonuses and $62.7 million for K-12 infrastructure and facilities funding. Gov. Lee’s FY25-26 budget includes the following additional investments:

Public Education Investments

  • $244 million to strengthen education through the Tennessee Investment in Student Achievement (TISA) formula growth, including teacher pay raises
  • $27.3 million for summer learning programs to support students between school years
  • $25 million further investment in the Fast Growth Fund, to support fast-growing districts
  • $20 million for School Safety Grant Fund
  • $10 million to provide paid parental leave for Local Educational Agency employees

Higher Education

  • $52.8 million to fully fund the outcomes-based funding formula, which may be used for program improvements that assist higher education institutions in meeting outcomes including student progression, degree production, research and service, efficiency metrics, and other measures related to institutional mission
  • $2.27 million to develop Tennessee Board of Regents’ Center for Workforce Development to expand workforce training for businesses and industries, including specialized onboarding and apprenticeship programs, in partnership with TN Accelerates
  • $2 million to create a common application system for Tennessee’s community colleges, streamline student transfer, and implement a statewide customer relationship management system to enhance student outreach and support
  • $119 million for additions and renovations to Middle Tennessee State University’s Murphy Center
  • $199 million for the construction of a new chemistry building at University of Tennessee Knoxville
  • $75 million to modernize research and laboratory space at the University of Memphis
  • $37.5 million to construct a new Tennessee College of Applied Technology (TCAT) in Robertson County

Strong + Healthy Families

  • $95.5 million utilizing Shared Savings to enhance long term care services and supports for older adults and people living with disabilities
  • $41 million to support the Department of Children’s Services (DCS) with placement of children within the provider network
  • $7.2 million to expand the WAGE$ Program and reduce turnover in Tennessee’s childcare workforce by increasing pay and rewarding greater education
  • $5.9 million to cover childcare for more working families through an expansion of the Smart Steps Child Care Program and ease the benefits cliff
  • $24 million to continue a Department of Health pilot program to address unmet dental service needs and increase the number of dentists in Tennessee
  • $11.8 million to reduce waitlists in the OPTIONS and Senior Nutrition programs
  • $10.9 million to expand programming at the Boys & Girls Club of Tennessee
  • $5 million to increase bed capacity at the Middle Tennessee Regional Mental Health Institute
  • $3 million for a partnership between Department of Children’s Services (DCS) and Department of Disability and Aging (DDA) to provide additional support services for children in DCS care with intellectual and developmental disabilities
  • $10 million for mental health infrastructure grants

Safe Neighborhoods

During the special legislative session in January 2025, Governor Lee and the General Assembly. The appropriated $5 million to prepare Tennessee to assist in implementation of the Trump Administration’s illegal immigration policies. The FY25-26 budget includes the following additional public safety investments:

  • $100 million to establish Downtown Public Safety Grants to increase public safety in downtown areas with businesses and commercial activity
  • $75 million further investment in the Violent Crime Intervention Fund to support local law enforcement and local jurisdictions through grants to fund evidence-based strategies to improve public safety
  • $38 million in funding for an additional 117 State Troopers and related support staff to improve public safety across the state
  • $5 million to further expand the Statewide School Resource Officer (SRO) Program Grant, which places SROs in each K-12 public school and public charter school in Tennessee
  • $3.7 million in funding for an additional 22 TBI positions to support victim services, intelligence analysis, aviation, security, Medicaid fraud enforcement, and administration
  • $1.3 million in additional funding for Houses of Worship Security Grants

Conservation

  • $62.2 million to execute a comprehensive regional water resource plan to ensure long-term water needs are met while protecting the ecological health of the Duck River
  • $52 million to create five new Tennessee State Parks, marking a total of 14 new, accessible state parks created under Governor Lee’s leadership, setting the Tennessee record for the most state parks created by one administration
  • $6.2 million to address maintenance needs at Tennessee State Parks, preventing a backlog of deferred maintenance
  • $40 million for environmental cleanup, including creation of a comprehensive water resource management plan in the Duck River region, state water revolving fund projects and electric grid enhancement
  • $12 million to establish the Alexander Institute for Environmental Education and the Sciences to offer environmental learning programming focused on his passion for land conservation, the environment, and STEM education
  • $1.4 million further investment in the Institute of American Civics (IAC) at the University of Tennessee to expand curriculum development to support state social studies standards and expanding IAC’s Civics Academy for K-12 teachers

Agriculture

  • $25 million to create a Farmland Conservation Fund
  • $20 million in additional funding for the Agricultural Enterprise Fund and Agricultural Enhancement Fund, both of which are utilized to aid Tennesseans in creating and expanding agricultural, food and forestry businesses and make long-term strategic investments in rural communities

Energy

  • $50 million to create the Small Modular Reactor (SMR) Grant Fund to support Tennessee Valley Authority’s Clinch River Nuclear SMR project to position Tennessee as a leader in next-generation nuclear energy
  • $10 million further investment in the Nuclear Energy Fund to attract advanced nuclear technology companies
  • $2.6 million to develop the nation’s first regulatory framework for commercial nuclear fusion power
  • $10 million further investment in Governor’s Investment in Vocational Education (GIVE) to support nuclear workforce education, as recommended by the Nuclear Energy Advisory Council
  • $20 million for the Federal Grant Matching Fund, to support proposals from Tennessee universities and businesses applying for research funding from federal agencies like the National Science Foundation and Department of Energy


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