Category Archives: budget

August state revenue $38M better than budget

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Tennessee revenues exceeded the budgeted estimates for August, which is the first month of the state’s fiscal year. Finance and Administration Commissioner Larry Martin today reported that overall August revenues were $948.2 million, which is $49.8 million more than August of last year and $38.0 million more than the budgeted estimate. The growth rate for all taxes in August was 5.54%.

“Corporate tax receipts and sales tax revenue reflecting July’s consumer activity posted positive growth for the month,” Martin said. “All other taxes revenues, taken as a group, also recorded positive growth.

“The positive revenue numbers for August reflect a continuing good economic environment in our state. It should be noted, however, that the sales tax, which is our largest revenue source, grew at a moderate rate of 2.2%. This is well below the average growth of 7.3% over the first six months of the calendar year.” Continue reading

TN bonds sell cheap (2.16%) with credit upgrade

News release from state comptroller’s office
The State of Tennessee has just completed the very successful sale of approximately $366 million of general obligation (GO) bonds. This is Tennessee’s first bond offering since receiving an upgrade of its bond rating to AAA from S&P in May 2016.

Tennessee’s top-rated credit sparked demand from investors while keeping interest rates extremely low.

The debt offering was sold in three series of bonds. The proceeds will be used to fund new capital projects and refinance currently outstanding bonds. The refinancing will save Tennessee taxpayers $22.8 million dollars over the next 15 years.

The combined true interest cost for the bonds was 2.16%. Records indicate that this is the lowest interest cost for a negotiated sale in the state’s history and is a direct result of Tennessee’s highly regarded credit and favorable market conditions.

“It gives me great pleasure to announce yet another history-making Tennessee bond sale,” said Comptroller Justin P. Wilson. “The Tennessee General Assembly and Governor Haslam have worked hard to place Tennessee in an incredibly strong financial position. Tennesseans are benefiting from the lowest interest rates in state history. It’s good to be a triple, triple-A state.”

TN fiscal year revenue $925M over estimates

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Total Tennessee tax revenues for July were slightly more than the budgeted expectation. Finance and Administration Commissioner Larry Martin reported today that July, which ended the accrual fiscal year, recorded a net positive growth of 0.74%, compared to July of 2015. Overall, July revenues were $1.0 billion, which is $13.8 million more than the state budgeted.

“July revenue results were somewhat mixed,” Martin said. “With sales taxes, we had stronger than anticipated growth but corporate and business taxes experienced negative growth. Also, all other taxes, taken as a group, were marginally below July 2015.

“Despite the mixed results in July, the year-to-date growth rate for all taxes ended the year well above last year’s revenue performance. It is important to note that despite the underperformance with corporate business taxes in July, year to date these taxes have a strong positive growth.” Continue reading

June state revenue $112.8M above budget prediction

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Newest figures show that total tax revenues in the month of June were more than budgeted expectations. Finance and Administration Commissioner Larry Martin reported today that June ended with a net positive growth of 6.16% compared to taxes in the same month last year. Overall June revenues were $1.3 billion, which is $112.8 million more than the state budgeted.

“June sales tax revenues recorded much slower growth than previous months, which was not expected,” Martin said. “However, June brought us stronger than anticipated collections from corporate business taxes and well above budgeted expectations for all other tax sources combined.”

On an accrual basis, June is the eleventh month in the 2015-2016 fiscal year.

General fund revenues exceeded the budgeted estimate in the amount of $105.3 million. The four other funds that share in state tax revenues were also in excess of budgeted expectations by $7.5 million.

Sales tax revenues were $1.2 million more than the estimate for June. The June growth rate was 1.28%. For eleven months revenues are over budget by $346.2 million. The year-to-date growth rate for eleven months was 7.18%. Continue reading

Cost of new UT building increasing (construction time, too)

The State Building Commission last week has approved another $4.14 million increase in spending on the University of Tennessee’s new Student Union complex in Knoxville, according to the News Sentinel. The new total cost figure: $181.74 million.

When the commission first approved the project in 2008, its cost was estimated at $116.6 million. But that was before the Recession settled in, cutting state revenue and delaying the project for more than three years. It was also before design plans were approved and construction bids were opened.

By the time its design was approved in 2011 and its size increased by 30 percent, to 390,000 square feet, the cost was pegged at $160 million. In 2012 it jumped to $167.6 million. In July 2015, the commission approved a $10 million increase, to $177.6 million, to cover the costs of “unforeseen abatement, poor soil conditions, utility relocation, user-requested design changes and for awarding bids that are higher than were estimated,” according to minutes of the meeting.

When demolition of the old University Center parking garage started in March 2012, finally marking the start of work, UT said it would take about four years — to 2016 — to complete the entire project, to be built in two phases.

The target for overall completion is now during the spring of 2018.

State revenue $41M over budget in May

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Tennessee tax revenues exceeded budgeted estimates in May, driven primarily by sales taxes. Department of Finance and Administration Commissioner Larry Martin today announced that overall May revenues were $1.0 billion, which is $41.3 million more than the state budgeted.

“Total reported receipts in May reflect significant improvement over this time last year, and were driven primarily by sales tax receipts,” Martin said. “Franchise and excise taxes fell short of May 2015 figures and were also below the monthly budgeted estimate. All other tax collections, taken as a group, were above the May estimate.”

On an accrual basis, May is the tenth month in the 2015-2016 fiscal year.

General fund revenues were more than the budgeted estimates in the amount of $37.4 million while the four other funds that share in state tax revenues were $3.9 million more than the estimates.

Sales taxes were $33.5 million more than the estimate for May and were 6.49% more than May 2015. May receipts reflect retail business activity that occurred in April. For ten months, revenues are $345.0 million higher than estimated. The year-to-date growth rate for ten months was 7.81%. Continue reading

State paying $5.5M to help Memphis company move

State taxpayers are anteing up $5.5 million toward the $27 million renovation of Memphis’s vacant Peabody Place mall into the new corporate headquarters for ServiceMaster, which is moving Downtown from its current East Memphis offices, reports the Commercial Appeal.

The State Funding Board on Thursday approved a $5.5 million grant for the project. The money is coming through the Tennessee Department of Economic and Community Development’s FastTrack economic development program that provides incentives for businesses to relocate to the state and, increasingly, to keep existing businesses here.

ECD spokesman Clint Brewer said the grant is the total state incentive for the project and will help pay for construction and renovation of the 15-year-old, 328,000-square-foot Peabody Place for use by ServiceMaster.

The state money was the first public incentive to be disclosed for the ServiceMaster relocation announced last Friday by the home and commercial services provider’s chief executive, Gov. Bill Haslam and Mayor Jim Strickland, who declared it “the most significant corporate headquarters announcement in Downtown Memphis in a generation.”

Downtown officials are proposing a $1 million grant to help ServiceMaster with an estimated $14,795,000 in tenant improvements.

…Landlord Belz Enterprises expects to spend about $12 million to retrofit the building.

On Tuesday, Belz is scheduled to ask another commission board, the Center City Revenue Finance Corp., to approve an amendment to Peabody Place’s existing tax abatement.

Knox mayor: Haslam broke promise on mental health funding

Excerpt from a Betty Bean column on Knox County Mayor Tim Burchett’s dispute with Gov. Bill Haslam, who the former state senator says had indicated the state would help with funding for a behavioral health urgent care unit (formerly known as the safety center).

Knox County put $1 million aside for the facility several years ago, plus another $200,000 in this year’s budget. Mayor Madeline Rogero has set aside $200,000. That won’t be enough, but Burchett vowed to find the money and dismissed the explanation he was given for the administration’s decision.

“I was misled about that, and I’m very put out about it. I was told, ‘Mental health is a local issue.’ Well, dadgummit, then, why do we have a Department of Mental Health in the state of Tennessee?”

He said the largest mental health hospitals in the state are the Shelby County, Davidson County and Knox County jails, and didn’t dodge the question of whether denial of state funds amounts to a broken promise by Gov. Bill Haslam:

“Yes. I’m of the opinion it was – but regardless of the state’s partnership, we’re going to go ahead with it…”

Burchett said about half of mentally ill inmates are veterans and accused the governor of breaking his promise that funding would follow the patients after he shut down Lakeshore Institute in 2012.

“We closed down Lakeshore and everybody loves Lakeshore Park – but where are those people going? You drive under any major bridge in Knoxville, you’ll see the human cost.”

A couple of days after his talk show appearances, Burchett still hadn’t cooled off, and said he was offended that Haslam was pleading budget constraints while spending $8 million subsidizing the TV show “Nashville.”

“They pulled the rug out from under us. I don’t like it when they start explaining that they didn’t get as much money as they expected, but I see all these little projects getting funded. I spent 16 years in the Legislature, was on the Senate Finance Committee and chaired the Budget Subcommittee. I know the system and I don’t like hearing that crap. I know that taking care of the mentally ill’s not sexy like that miserable TV show – which has been cancelled, thank goodness – but when they talk about return on investment, I say, ‘What about investing in somebody not going to jail when what they need is treatment?’”

State subsidies not enough to save ‘Nashville’ from ABC ax

The ABC television drama “Nashville” will not be renewed for a fifth season despite allocation of another $8 million in incentive money including in the state budget for the coming year.

From The Tennessean:

The show’s production reshuffled its creative team and negotiated in principal a lucrative government incentive package in making its sales pitch for renewal to ABC. But inconsistent ratings plagued the program, a fictionalized drama on the local music industry and city politics.

Still, “Nashville” made its mark on the local economy.

Tourism leaders say “Nashville” lured visitors from around the globe. The Bluebird Café, which was a regular setting for the show, enjoyed sell-outs and long, winding lines of fans hoping to gain a seat.

“We are incredibly disappointed to hear the news that ABC has not renewed the show ‘Nashville’ for another season,” Nashville Mayor Megan Barry said in a written statement. “The show has been an enormously successful promotional tool for our city, which is why the state of Tennessee and Metro Nashville were prepared to support production for a fifth season to be filmed here.

“This is a loss for ABC and for the millions of fans across the world who have grown to love this show. We have enjoyed hosting the cast and crew of the show over the last four years and look forward to future opportunities for film and television production here in Nashville.”

…In four years of production, “Nashville” brought in $45.65 million in incentives, mostly from the state. The state and Metro justified the incentives because they viewed “Nashville” as an hour-long commercial for visiting the city.

In that way, the show influenced the incentive strategy for film work, with a new focus on productions that might help boost tourism.

“The state has supported the show, and we believe it was an excellent marketing vehicle for Tennessee,” said Bob Raines, executive director for the Tennessee Entertainment Commission. “The show had a great run, and it will live on through syndication and streaming services for people all over the world to enjoy. The show also leaves a terrific musical legacy that fans can continue to enjoy and associate with Tennessee and the city.”

State’s April revenues $185M above estimates

News release from Department of Finance and Administration
NASHVILLE, Tenn. – Tennessee tax revenues exceeded budgeted estimates in April. Department of Finance and Administration Commissioner Larry Martin today announced that overall April revenues were $1.8 billion, which is $185.0 million more than the state budgeted.

“Total reported revenues in April reflect significant improvement over this time last year in both sales and business taxes,” Martin said. “While franchise and excise taxes and income tax revenues are typically large in the month of April, much of the state’s revenue growth is a result of strong sales taxes, reflecting consumer confidence in Tennessee.”

On an accrual basis, April is the ninth month in the 2015-2016 fiscal year.

General fund revenues were more than the budgeted estimates in the amount of $165.9 million while the four other funds that share in state tax revenues were $19.1 million more than the estimates.
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