Legislative Update – Feb. 2, 2022
Tennessee Governor Bill Lee delivered his annual State of the State address the evening of Jan. 31, titled “Tennessee – America at its Best“, where he proposed a $52.5 billion fiscal 2023 spending plan, a nearly $10 billion increase thanks in part to an infusion of federal funds. As part of the State of the State, Governor Lee unveiled his proposed budget for the 2023 Fiscal Year.
To see a snapshot of the proposed budget, you can click here and the full budget document is here.
Last year’s historic investment of $931M in capital outlay is dwarfed in comparison to the $2.541B in state funds for higher education and general government capital improvements with an additional $214.8M for capital maintenance. This proposed investment is a credit to the design/construction industry’s advocacy efforts to show the return on investment and positive economic impact the industry has when projects are funded at this level. The capital outlay portion of the budget may be found beginning on page A-127 with the following graphic giving a summary of the recommended spending.
It is also important to note that $10M has been allocated to the TN Historic Development Grant Program, which was created last year in response to advocacy efforts to implement a state historic tax credit. The Administration prefers to fund preservation projects via grants verses a state historic tax credit. AIA Tennessee advocates on behalf of architects across the state to continue to promote your profession and the impact it has on TN’s built environment. As further discussions and plans take shape on the budget, we will update you so that you have timely information to use as a resource as you communicate with your legislators.
Additional Resources:
- Finance & Administration Commissioner Butch Eley’s budget overview presentation to the Finance Committees with slides devoted to capital outlay on pages 22 and 23.
- Line item budget summary with references to outlay highlighted in yellow.
Other highlights in the budget include:
- $355 million to spend on a new multi-agency law enforcement training academy built in Nashville.
- A large portion of the budget and Lee’s legislative priorities will focus on K-12 education and a long-promised revamp of the Basic Education Program, the state’s current funding formula. Lee is seeking $1 billion for his education plan, including $750 million toward the new funding formula, the details of which have not yet been proposed for lawmakers.
- $50 million into the state’s rainy-day fund which, combined with the state’s existing TennCare reserve, would grow the state’s reserve over $2 billion.
- $125 million is earmarked out of $250 million proposed recurring education funds for teacher compensation. Though Lee emphasized money marked for teacher salaries should go straight to teacher pocketbooks, how much of an increase the average teacher could see is unclear.
- $250 million to Tennessee State University. The new money would come after a report by Office of Legislative Budget Analysis last year showed Tennessee has underfunded the university for decades.
- $82 million to public hospitals to cover uncompensated care, in addition to an $18 million plan to attract 150 primary care medical residents for rural communities.
- $25 million to expand dental care for more than 600,000 TennCare recipients.
- $90 million to fully-fund the outcomes-based formula in higher education, enabling a zero percent tuition increase for public universities.