Today marks the beginning of the governor’s annual budget hearings, the administration’s annual dog-and-pony show for state agency heads to highlight the happenings at their departments.
It’s also a time to explain what each agency would cut if forced to do so.
Over the full week, Gov. Bill Haslam will hear each department head explain agency spending plans and how they would cut 3.5 percent from their bottom lines, an exercise assigned each year by the governor’s office. However, revenues feeding the state’s $33.8 billion budget appear flush so far this year.
Here’s a short list of what to watch for as the budget hearings unfold this week:
1. The Department of Corrections budget. After a wild year of headlines ranging from taxing schedules for prison guards to safety in correctional facilities, the presentation from the department’s commissioner, Derrick Schofield, will be telling. The commissioner has insisted there is little to see in the department’s troubles, but whether he comes to the governor with a wish list of spending to make those problems go away — and how it’s received by the governor — will be worth watching.
2. Judging the winds on education funding. With a lawsuit seeking more state money for education currently sitting in Davidson County Chancery Court, many are wondering whether and how the governor will boost funding for schools. Close to a dozen school boards across the state have either sued the state or are thinking about it to fight Haslam for more education dollars. Separately, the governor has struggled to keep his vow to increase teacher pay faster than any other state in the country. With the debut performance of first-year Commissioner Candice McQueen presenting the Department of Education’s proposed budget, the key will be whether the governor hints at what kind of moves he will make on either of these fronts.
3. The gas tax pitch from the Department of Transportation. Commissioner John Schroer has made it no secret in recent years that he wants the state to figure out how to better fund a mound of backlogged transportation projects. After he and Haslam spent the better part of a year trying to convince legislators to take up that challenge in earnest, it will be key to see how much gas Schroer and the governor give to calling for a change in the gas tax.
4. How much money does Haslam have to play with? After a scare in 2014 that forced the state to renege on promises to increase pay for teachers and make budget cuts, the governor is unlikely to spend the state’s growing revenues wildly next year. But with state tax collections so far this fiscal year up $223 million more than expected — posting the strongest first-quarter growth since 2004 — the governor will likely have more money to play with next year. Watch for what the governor says, or hints, about spending money on.
5. The tenor of TennCare talks. Following his failed attempt to get state legislators to approve his plan to increase healthcare access to 280,000 low-income Tennesseans this year, the issue of health care is still beating. Health care and social services eats up about a third of the state budget each year, and although the legislature is uninterested in the governor’s so-called “Insure Tennessee” plan, the growing cost of health care is one the administration and legislature will have to wrap their arms around next year.
Should Tennessee let Syrian refugees settle here? Yes, says Gov. Bill Haslam, but the federal government should let Tennesseans help vet them.
After a week driven by headlines about state officials wanting to halt the placement of Syrian refugees here after terrorist attacks in Paris, the governor is asking public officials to tone down the rhetoric while also insiting the state needs more authority to evaluate refugees first.
“I’ve never seen our people so afraid about something that the fear level would be here. And if we can be a part of the process, then we’re a whole different messenger out there among our population,” Haslam told reporters after a keynote address to the Nashville Rotary Club at the Wildhorse Saloon Monday.
"I think we have to be really careful about the blanket statements we make," he added.
House Republican Caucus Chairman Glen Casada, Franklin Repblican, told reporters last week that the state should round up and detain Syrian refugees placed in Tennessee, a statement sending shockwaves across the state, speaking to his base while infuriating immigration advocates.
The “vast majority” of refugees are families, not terrorists, Haslam told reporters. “I think we need to be cautious. Like I said, I asked the president to halt. But we also have to realize that there are a lot of people in this population who are doing the same thing any of us would do if we were in that situation,” Haslam said.
After a recent conference call between governors and White House Chief of Staff Denis McDonough, Haslam said he and other governors have received "no encouragement" that the federal government will allow states into the fold of examining refugees before their placement in states like Tennesseee.
Because of backlash from local governments, the Hall tax is never likely to disappear, but legislators are always looking for ways to tweak it. The latest idea is to remove Social Security benefits from the income calculation that determines who has to pay the tax. Currently, the threshold is annual income of $37,000 or $68,000 for joint filers.
A Freeman intimate says the Democrat is indeed taking "a long, hard look" at what will be an open governor's seat in 2018, given that Republican Bill Haslam is term-limited and can't run again.
While it's too soon to tell where the "long, hard look" will lead, if Freeman does run, his ability to self-fund could make for a very interesting Democratic primary contest — should one materialize — and general election.
Joey Garrison talks to the man himself:
"I’m concentrating on other things right now,” Freeman said. “That’s a long way off.
“I don’t want to rule anything out or anything in, but that’s not anything I’m working on at the moment,” he said, adding: “I’m hoping we find some great candidates, and I’m concerned about some of the candidates on the other side, and I think it’s important that a good Democrat step up. And I think we've got several looking, and I hope I can find one that I can get behind.”
Mark Cate (left), who managed Bill Haslam's gubernatorial campaign in 2010 and later became the governor's chief of staff, and Jeremy Harrell, who handled the re-election in 2014, have partnered with Stephen Susano, who led the Tennessee Business Partnership — the group that largely funded the effort to pass the judicial selection amendment — and formed Stones River Consulting. The firm's first public client was the Tennessee State Museum Foundation, which paid Stones River $10,000 a month to coordinate fundraising efforts for a new museum.
Humphrey has the press release.
Mark Braden — a lobbyist, public relations guru and former campaign manager for U.S. Sens. Lamar Alexander and Bob Corker — is launching a nonprofit aimed to impress upon the masses the benefits of conservatism.
Paperwork filed with the Secretary of State on Monday for “Tennesseans for Conservative Action” listed two fellow incorporators: Republican House Speaker Beth Harwell’s former chief of staff Gregory Gleaves, who has since started his own campaign consulting and direct mail firm, and former Tennessee Republican Party Chairwoman Robin Smith, who ran unsuccessfully for a open congressional seat in 2011, losing to U.S. Rep. Chuck Fleischmann. Braden is vice president of Mercury, described as a "high-stakes public strategy firm."
The TCA’s goal is “to inform and educate the public of the proven conservative principles that, when applied in governing, serves the best interests of the individual, the culture of freedom and the government of all people,” said Gleaves, who declined to comment further. A call to Braden, who has top billing at the organization, was not returned as of this posting.
The organization has already staked out a Facebook page and a website, the latter of which is not yet operational. Gleaves said the organization plans to launch in several weeks, but declined to say how TCA plans to achieve its mission.
Mayor Megan Barry had a chat with House Speaker Beth Harwell and a cordial lunch with Lt. Gov. Ron Ramsey:
"We just didn't want it to be Mayor and Governor. We wanted it to be Megan and Ron and I think that's what a meeting like this accomplished. No issues at all," Ramsey said Monday night.
The quick-talking auctioneer from far East Tennessee — arguably the most powerful Republican in Tennessee politics — leads the state Senate in a Republican-led legislature known for engaging in turf battles with the Democratic capital city, such as derailing The Amp and nixing a prevailing wage for city contractors.
"I don't think the legislature has changed any on most those issues. At the same time, that doesn't mean we can't be cordial, we can get along, not take anything personally. I stress that if we disagree, we disagree agreeably," Ramsey said.
The two avoided all talk about business or politics, Ramsey said, and instead bonded over talk of their experiences pheasant hunting and him gushing over his four grandsons with a fifth baby on the way.
Betsy Phillips says the governor made plain to the credit agencies that outsourcing is an option because he had no other choice, given the legislature:
Okay, let's repeat the important point in here: We, as a state, need the best credit rating we can get. In order to show that we we deserve a good credit rating, we have to show that we can cover our obligations and repay any debts we might have. And here's the jam Haslam rightly identifies us as being in—our Medicaid and education costs keep going up but our politicians will not raise taxes to cover those costs (or for any reason). So, in order to show that we can cover our obligations, Haslam has to be able to show them ways we have of coming up with the money. When you can't raise taxes, you have to cut.
Gov. Bill Haslam's 10-minute pep talk Wednesday on the latest happenings in Tennessee's business stratosphere lacked any mention of the state's most high-profile investment: Volkswagen. But Haslam did address the topic in remarks after his formal address to the two-day Governor's Conference on Economic and Community Development at the Renaissance Hotel.
The German auto company announced earlier Wednesday that Winfried Vahland, the head of North American operations for less than a month, has left the company over disagreements about how to restructure the business. The move leaves Volkswagen without a continental face following revelations that the company equipped vehicles with devices to skirt diesel emissions tests.
“He was actually supposed to have visited Tennessee this week or last. I guess we know now why he didn't come,” joked Haslam when talking to reporters after his speech at the 62nd Annual Governor's Conference on Economic and Community Development. “The key thing is for Volkswagen to define the problem and say what they're going to do about it. I think until they do that, everybody's going to be looking with some doubt about what they're doing when what we need them to do is say, 'Hey, we're making a lot of good vehicles.' And we need them to get back to selling those vehicles.”
Tennessee invested an estimated $360 million of incentives to lure Volkswagen to the Volunteer state, with local governments coughing up another $220 million to manufacture the Passat here. Another $260 million is on the way between state and local governments for a second line of vehicles.
Before hundreds of people at the annual conference downtown, Haslam stressed how easy it is to sell businesses on locating to Tennessee. Connecting education to the workforce is a must, he said, and the need for a rural development initiative is real and a new project of his administration. The state's work on development is a team effort, he added, and said despite occasional disappointments, the outlook is encouraging.
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