Tag Archives: inflation

And Then There’s Inflation

A state economist says one factor setting back Tennessee’s recovery is inflation, reports WPLN.
University of Tennessee economist Bill Fox says there are fewer state dollars overall. And the $10 billion the state does bring in aren’t going as far as they used to.
Fox thinks a couple years from now Tennessee will finally have more tax dollars than in 2008, before the recession hit. But that amount will be worth less by then.
“If you realize the effect of inflation on those dollars, we’re still 10 percent lower.”
In other words, even after the state budget has dug out of the crater left by the recession, it’ll have a lot of catching up to do.
“What we’re looking at is 1.5 to 2 percent inflation over this next year. So as we think about tax revenue growth of 3.5 to 4 percent, in line with what I’m talking about, then 1.5 to 2 percent is just normal inflation. And only 1.5 percent or so is actual growth in real tax revenues.”

Unpaid Fines Making Penalties Pointless for Many in TN

A new legislative report shows the severity of fines imposed by Tennessee courts has been eroded by inflation over the past 22 years, but some involved in the process say that really doesn’t make much difference.
“I’m not sure the amount of the fine is important anymore,” said Knox County District Attorney General Randy Nichols. “What difference does it make if the fine is $50 or $100 if it’s not going to be paid anyway?”
A law passed by the General Assembly earlier this year calls for revoking the driver’s license of anyone who does not pay his or her fines and court costs, starting next year. Whether that helps or hurts the situation is the subject of some debate.
But as things stand now, Nichols said, the fines imposed for convictions on charges ranging from traffic offenses to robberies are becoming increasingly meaningless. Data collected by the Legislature’s Fiscal Review Committee would appear to support that assertion.
In estimating the impact of the license revocation legislation, the committee staff reported that, based on 2009 figures, there were 328,000 persons statewide ordered to pay fines and court costs and that about 75 percent, or 246,000, did not pay them. Officials involved say the non-payment level has, if anything,, probably increased since then because of economic conditions.
In a new report released last week, the committee staff reviewed the impact of inflation on fines. The fine for most offenses were established by law in 1989, the year that the state’s criminal code was completely overhauled and updated.

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