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VOL. 41 | NO. 18 | Friday, May 05, 2017

Thursday's acrimony is Friday lovefest: House passes $37B budget

By Sam Stockard

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Putting a day of acrimony behind it, the House of Representatives overwhelmingly passed a $37 billion budget plan, stripping away nearly $320 million in amendments placed on it the previous day.

Compared to the previous day of arguments and overspending, Friday’s debate was a veritable lovefest.

Before passing the measure in an 83-2 vote, the House voted 77-9 to send $55 million in Gov. Bill Haslam’s budget amendments to the state’s 95 counties for use in State Street Aid funds rather than putting it into the state’s transportation fund.

The relatively smooth action came a day after the House Democratic Caucus teamed with a group of conservative Republicans to slow down the budget process to ensure it had a voice in the budget process.

“This year a lot of us have had the opportunity to run beside the train and jump on the train and to get up in front of the train” and help guide it, instead of being run over, said Rep. Antonio Parkinson, a Memphis Democrat.

Still, Democrats didn’t win support for a K-12 education fund, a measure sought by Rep. Craig Fitzhugh, though he could bring it up next since it doesn’t have to be funded with this year’s budget. He has called it more of a shift in the rainy day fund to generate interest for education programs.

Members of the House Republican Caucus met during a one-hour break early Friday to discuss their plan of attack a day after they sniped at each other over a spate of amendments that displayed disgust with the House vote earlier this session in favor of the governor’s IMPROVE Act.

In that meeting, Republican Chattanooga Rep. Gerald McCormick told the caucus he planned to introduce an amendment to move the $55 million into a K-12 education fund.

Yet McCormick, who nearly went toe-to-toe Thursday with fellow Republican Rep. Matthew Hill over a new amendment on funding for neonatal abstinence babies, told members on the House floor: “I just want to add to this joyous day with all these positive comments in the room.”

With that, he withdrew an amendment to shift the $55 million in highway funds to creation of a K-12 education fund, the brain child of Fitzhugh designed to provide money to local school systems to pay for items such as computers, extra learning programs or high school dual enrollment.

Even with the $55 million being moved to the State Street Aid Fund, Shelby County is expected to be able to use the money for Memphis streets, as well, because it would go through the Metropolitan Planning Organization, according Shelby County legislators.

Though some counties have clear delineation between county and city highway departments, state Rep. Joe Towns said the money should be going to the entire geographical area of each county.

“It does not preclude any money being spent on city roads,” said Towns, a Memphis Democrat.

Bartlett Republican Rep. Ron Lollar pointed out that Shelby County’s Metropolitan Planning Organization directs where funds are spent from the State Street Aid Fund.

Republican Rep. Judd Matheny of Tullahoma, who sponsored the amendment, said he interpreted the measure to mean MPOs would continue to decide how that money is used.

During a House Republican Caucus meeting before the House session, Matheny said he met Thursday with Senate leaders and negotiated the transportation amendment. The move came after he pushed a $300 million amendments through the body Thursday to go toward school systems’ capital projects statewide.

That amendment combined with several others would have required the House to shift $325 million from the rainy-day fund into the budget plan. All of that was wiped away, though, when the House adopted the budget proposal.

The $37 billion spending plan, which goes next to the Senate for consideration, contains a $1 billion surplus in non-recurring money and nearly $1 billion more in recurring extra money.

After an hour of debate the House, voted to recognize it exceeded its Copeland Cap, meaning it collected $438 million more in revenue than expected, surpassing the percentage increase in household income.

Rep. Charles Sargent, a Franklin Republican who chairs the House Finance, Ways and Means Committee, told the body, “We have an excellent, excellent budget sitting in front of us.”

It contains the IMPROVE Act, with increases in gas and diesel taxes in addition to vehicle registration fee increases, which are more than offset by reductions in the food tax, Hall income tax on interest and dividends and a decrease in franchise and excise taxes for manufacturers.

The idea is to increase funding for the state’s transportation fund to expedite 962 road and bridge construction projects over the next 15 years, with the state facing a $10.5 backlog on infrastructure work.

For the second year in a row, the budget takes on no new debt. At the same time, it provides $396 million more for employee compensation, including pay, insurance benefits and retiree insurance.

It increases spending for K-12 school spending, higher education for need-based scholarships and hires more officers for the Department of Safety.

In addition, it repays $120 million to the transportation fund taken a decade ago to shore up the general fund. It also sends $132 million more to the rainy day fund, increasing it to a record $800 million, accompanying an increase in the TennCare reserve that boosts it to $219 million.

Sam Stockard can be reached at sstockard44@gmail.com.