News release from Senate Republican Caucus:
NASHVILLE, Tenn.), July 22, 2013 — State Senator Jim Summerville (R-Dickson) has announced plans to file legislation in the Tennessee General Assembly to freeze tuition at the current rates at state colleges and universities. The announcement comes after the Tennessee Board of Regents (TBR) and the University of Tennessee (UT) system recently adopted hikes in tuition ranging between 3 to 6 percent.
“The current increases are an outrage, especially in light of this year’s increase in appropriations to these higher education systems,” said Senator Summerville. “No other governmental department consistently raises their costs to the taxpayers at such a high rate on an annual basis.”
The General Assembly approved a budget providing a $108.6 million increase for higher education, including $65.7 million in additional funds for the Tennessee Board of Regents, $37.6 million for the University of Tennessee system and $5.2 million for the Tennessee Higher Education Commission. A 2010-2011 study by the Bloomberg News College Board found that 56 percent of public four-year college students average $23,800 in student loans upon graduation.
“Over the past decade, tuition at public colleges and universities has increased by an astounding 62 percent,” added Summerville. “These ever-increasing costs lead students to take out more loans, thus saddling themselves with debt that can take almost a lifetime to pay back.”
Summerville said his legislation, the “Tennessee College Students’ Tuition Relief Act,” is currently in the drafting stage but will freeze tuition for several years. He said bill will include cost reduction recommendations to help the state’s higher education system realize efficiencies. This could include top-heavy administrative office expenses and excessive salary packages for college coaches.
“Non-instructional cost is a good place to start in looking for savings,” added Summerville. “If we are going to meet our goals of raising our college graduation rates, we must get a handle on the rising costs. This legislation is a big step in the right direction to accomplish this.”
News release from Senate Democratic Caucus:
NASHVILLE – Senate and House Democrats called on Governor Bill Haslam Wednesday to convene a special legislative session to freeze tuition rates and cut the food tax, using part of the $225 million in excess revenues the state has collected.
“Now is the time to provide tax relief for all Tennesseans, especially those who are training for new jobs that require a college degree,” said Senate Democratic Caucus Chairman Lowe Finney. “If we’re serious about growing jobs and putting people back to work, then we shouldn’t be raising fees on people who want to work.”
Caucus leaders calculated that, based on numbers provided by the Tennessee Board of Regents and the University of Tennessee, $78 million of the excess revenues would cover all proposed tuition increases at state colleges and universities. Democrats made the announcement as UT trustees met to discuss an average 6 percent tuition increase.
The Board of Regents, which oversees six state universities as well as community colleges and technology centers, proposed similar tuition increases last week.
“It is wrong to tax people who are going into debt to improve their lives,” said Senate Democratic Leader Jim Kyle. “A tuition increase is simply a tax on students. The money is there. The question is whether the political courage on the other side is also there.”
Democrats also pushed for an additional 1 percent decrease to the sales tax on groceries, which would provide $85 million in tax relief for all Tennesseans. Lawmakers reduced the sales tax by .25 percent during the regular session, meaning Tennesseans would save only 25 cents per $100 of groceries.
“We can provide Tennesseans four times the amount of tax relief in a matter of days,” said Senator Tim Barnes of Clarksville. “It would mean a lot to people in my district who are barely making ends meet as it is.”
The remaining $62 million in excess revenues would go into state reserves.
“This is about providing real results to every Tennessean and telling college students of all ages that we support them,” Finney said. “That’s the message that should be coming from every lawmaker’s office, regardless of political party.”
Note: Asked for comment on the Democrats’ proposal, Haslam spokesman David Smith emailed this: We want to be sure we have a complete picture of what our budget commitments will look like before we interrupt the budget process and start spending funds in an ad hoc way. There are still unknown expenses out there that a comprehensive budgeting process accounts for – such as TennCare inflation or fully funding the BEP. Also, providers have been saying they can’t pay the hospital assessment fee forever. Regarding higher education, the governor has said and continues to believe we need to focus on higher education in Tennessee, and examining the cost structure is certainly part of that process. That shouldn’t be done from a quick-fix perspective.
-The operating budget for state higher education was not reduced in the upcoming fiscal year for the first time in recent memory
-the budget includes $342.6 million in campus improvements and maintenance
News release from Senate Minority Leader Jim Kyle:
NASHVILLE – Senate Democratic Leader Jim Kyle called on Governor Bill Haslam and lawmakers to introduce larger cuts to the food tax and to freeze college tuition rates amidst news that the state government has nearly $225 million in excess funds.
“The Governor has said he believes we should provide the best services at the lowest cost possible,” Kyle said. “It’s time to take out the scissors and give the people of Tennessee new, lower prices on food and education.”
Lawmakers this year repealed the state’s gift and inheritance taxes, saving some of the wealthiest Tennesseans millions in current and future taxes, while approving a .25 percent decrease in the food tax – meaning middle-class Tennesseans will save only 25 cents per $100 of groceries.
Kyle also encouraged Haslam and higher education leaders to hold the line on college tuition rates. The same week the excess revenues were announced, state community colleges and universities proposed tuition increases ranging from 4 to 7 percent.
“We’re asking Tennesseans to pay more for college while saying that we have all this extra money,” Kyle said. “Something doesn’t add up.”
Note: See also Rick Locker’s write-up.
CHATTANOOGA, Tenn. (AP) — One day after the Tennessee Valley Authority board extended a pay freeze for a second year, a report shows TVA President and CEO Tom Kilgore’s compensation increased by $352,000 in fiscal 2011, to $3.95 million.
A TVA filing Friday with the Securities and Exchange Commission shows compensation increased for all five of its top executives.
Kilgore is one of the highest paid federal employees in the United States.
A TVA spokesman said Thursday after the board extended the pay freeze for fiscal 2012 that the SEC filing could show increases in long term pension and some other compensation.
The Chattanooga Times Free Press reports that TVA Personnel Vice President Janet Heron said Friday that the nation’s largest public utility tries to “provide a competitive compensation package that rewards performance.” (http://bit.ly/snhoab )
The state Department of Revenue proposed back in December a new rule that apparently is designed to make sure Amazon.com doesn’t have to collect Tennessee sales taxes when it opens a new distribution center near Chattanooga.
Gov. Bill Haslam has declared his support for Amazon’s continued avoidance of Tennessee sales tax payments. But it now appears that a freeze on any new rules — ordered by Haslam shortly after taking office last month — has blocked the Amozon-benefiting rule from moving forward.
The development is reported today in the Chattanooga Times-Free Press (and the subscription-only Tennessee Journal). The department can’t officially say whether Amazon is impacted because of confidentiality rules.
From Andy Sher’s Chattanooga TFP story: The proposed regulatory change exempts “any dealer operating as a distribution center” from collecting Tennessee state sales taxes if 50 percent of their gross receipts come from shipments on behalf of another vendor “to destinations outside this state.”
The proposal had been scheduled for a Feb. 25 public hearing before the Revenue Department, confirmed Revenue Department spokeswoman Sara Jo Houghland, who said departmental rules prohibited her from identifying what companies might be affected by the change.
Shortly after taking office, Haslam announced a 45-day freeze on new regulations as part of his “top to bottom” review of state government operations. (Note: Haslam said at the time he didn’t know what rules were impacted. It was earlier reported that another pending rule impacted Pilot Corp., which is owned by the governor and members of his family.).
But the move appears to have caught up the Amazon deal, which had been negotiated in part by the governor’s deputy, former Hamilton County Mayor Claude Ramsey.