Budget bill goes to the governor — no amendments, just as he wanted it

The General Assembly sent Gov. Bill Haslam a $32.4 billion state government spending plan Thursday without altering it in any way from his design, rejecting some last-minute efforts to make changes.

The House approved the bill (HB2501) first on a 68-27 vote after killing Democratic efforts to add pay raises for state employees and teachers. Only two Republicans voted against the budget; only one Democrat voted for it.

The Senate followed with a more lopsided vote, 28-3, with the negative votes coming from Democrats. One of them, Senate Minority Leader Jim Kyle of Memphis, protested that legislators were not showing any independence because they had “not changed a dollar” from the executive branch plan.

Kyle pushed an amendment that would have taken $2 million out of the Legislature’s separate $41 million reserve fund to pay for processing a backlog of “rape kits,” which are used to collect evidence in cases of sexual assault for potential use at trial of a suspect. That was killed on a party-line vote.

On a separate bill that makes changes in state law to allow Haslam to take money out of various reserve funds for budget-balancing purposes (SB2597) , Kyle proposed an amendment that would have added the legislative reserve fund to the list. That, too, was killed on a party-line vote, despite Kyle’s contention that exempting the legislature’s reserve means “everyone had to make hard decision but us.”

House Finance Committee Chairman Charles Sargent, R-Franklin, said the budget marks the “first time in institutional memory” that the General Assembly has approved a state budget without approving any amendments proposed by individual legislators.

The appropriations bill actually calls for spending less in the coming fiscal year than in the current year, which ends July 1. Sargent said the current year’s budget is $33.2 billion, as modified, and this year’s $32.4 billion is 2.4 percent less.

The reduction is due to a combination of lowered federal funding sent to the state in some areas and a shortfall in state revenue collections compared to what was anticipated when this year’s budget was adopted last year.

Haslam in February proposed a larger budget, but whittled back the spending with an administration amendment filed last week. The biggest cutback was elimination of proposed pay raises – 1 percent for state employees and 2 percent for public school teachers.

House Democratic Leader Craig Fitzhugh of Ripley proposed two amendments on the House floor to put some type of pay raise back into the budget. Both were killed on generally party-line votes.

One would have taken money from a reserve for incentive grants to new or expanding businesses and reduced the amount of money Haslam’s bill adds to the state’s general “rainy day” reserve fund. The resulting funds would have gone to pay for a 1 percent across-the-board pay raise for teachers, state employees and higher education employees. The amendment also called for giving higher education an extra $29 million, which Fitzhugh said would deliver money promised, but not delivered, when the “Complete College Act” was enacted two years ago.

House Republican Caucus Chairman Glen Casada attacked the proposal, saying that using reserves from the business grant program amounts to “consuming your seed corn” needed to grow jobs. Fitzhugh disputed that proposition, noting a separate bill authorizes an issue of state bonds to cover the cost of grants to two major expanding businesses – showing the reserve fund, which standards at about $200 million, is not needed when payment of the grants is handled otherwise.

The other Fitzhugh amendment, offered as an alternative, would have instead provided a pay raise if state revenues rebound in the remaining months of the current fiscal year. He noted the state still does not have tax collection data from March and more money could be coming in that is not taken into account in the Haslam budget because the Legislature is adjourning so early.

“It’s a gimmick and it’s a slippery slope to go down,” said House Majority Leader Gerald McCormick, R-Chattanooga, in urging the amendment be killed. He said any extra money that does come in could well be needed for other purposes, such as dealing with an earthquake in West Tennessee or a major flood elsewhere.
“If Chicken Little is right and the sky does fall, we’ll have a lot worse probrlems than this pay raise amendment,” replied Fitzhugh.

The vote on the first Fitzhugh amendment was straight party line. On the second, two Republicans joined in voting with Democrats for it and some others did not vote as it was tabled, or killed 57-30.

Note: This expands, updates and replaces earlier post.