Image Credit: TN General Assembly
The Tennessee Conservative [By Adelia Kirchner] –
Tennessee lawmakers are scrambling to cross the session finish line as a federal court date looms near with multiple House Republicans subpoenaed to testify in the Casada-Cothren trial starting April 22nd.
On Monday Chairman of the Senate Finance Committee, Sen. Bo Watson (R-Hixson-District 11), told members that his committee would be getting this year’s budget passed in time for a potential floor vote on Wednesday.
Committee members met on Tuesday afternoon to review, amend, and finally vote on this year’s proposed budget bills.
The Appropriations Act
House Bill 1409 (HB1409)/Senate Bill 1431 (SB1431) is the state budget for Fiscal Year 2026 (FY26), beginning July 1st, 2025.
50% or $29.7 billion of the $59.7 billion budget will come from state appropriations.
35% or $20.8 billion comes from federal funds and the remaining 15% or $9.2 billion comes from other sources according to House Finance Committee Chairman Rep. Gary Hicks (R-Rogersville-District 9).
A general breakdown of major expenditures is as follows:
- $597 million for disaster relief
- $640 million in new state funding for K-12 education
- $264 million for Higher Education including tech schools and community colleges
- Over $1.5 billion in new state funding for health and social services
- Over $378 million for law and safety
- $213 million to the Department of Economic and Community Development for various initiatives
- $1 billion to the Tennessee Department of Transportation
Gov. Lee’s initial budget proposal included approximately $60 million for the “Starter Home Revolving Loan Fund.”
State lawmakers opted to remove that line item from the final budget.
“Can you just help me understand the rationale there?” Sen. Yarbro asked regarding that decision.
“In the discussion between the House and the Senate, the determination was made that we would prefer to use those dollars in other places like helping to fund the volunteer firefighter program,” said Sen. Watson. “As well as we wanted to make sure we had plenty of money to fund some of the other initiatives that members found important.”
Another key change in the budget was made in regard to recent legislation stripping local GOP groups of the ability to choose a caucus or convention over a primary election.
There is an $8 million cost associated with that legislation.
When Sen. Joey Hensley (R-Hohenwald-District 28) questioned this change, Sen. Watson stated that it had to be made in light of the new legislation’s passage in both chambers and that $8 million will be allocated to the Department of Finance and Administration for reimbursing county election commissions “in connection with primary elections.”
“In negotiations between the two chambers, the legislature is recommending that we fund the primary elections at the local level,” said Sen. Watson.
The monies allocated for primary elections in this budget are non-recurring and would require the General Assembly to come back and fund it again in the future.
Democrat and Republican members of the House Finance Subcommittee and the House Finance Full Committee passed the budget unanimously on Tuesday morning.
The budget also passed in the Senate Finance, Ways and Means Committee by a 7-2 vote that afternoon.
Republican Senators Haile, Johnson, Powers, Rose, Stevens, Walley, and Watson voted in favor of the budget.
Sen. Joey Hensley and Sen. Jeff Yarbro (D-Nashville-District 21) made up the two no votes and Sen. London Lamar (D-Memphis-District 33) passed on her vote and was marked as “present and not voting.”
The Budget Implementation Bill
House Bill 1408 (HB1408)/Senate Bill (SB1429) enacts “the statutory changes necessary to implement the budget” according to Sen. Jack Johnson (R-Franklin-District 27).
On Tuesday, the budget implementation bill passed the House Finance Subcommittee and the House Finance Full Committee unanimously.
The bill also passed unanimously in the Senate Finance, Ways and Means Committee that afternoon.
The Bond Bill
House Bill 1407 (HB1407)/Senate Bill 1430 (SB1430) as introduced, “authorizes the state to issue and sell bonds of up to $1,009,547,000.”
“We haven’t taken out bonds in a long time and we are quite frankly one of the lowest debt, lowest tax states in the nation,” Rep. William Lamberth (R-Portland-District 44) told House Finance Subcommittee members, “it makes sense from time to time to actually take on a little debt for long-term projects like buildings.”
This year the bond bill includes bonds for:
- MTSU Murphy Center
- Tennessee Department of Children’s Services (DCS)
- New TEMA Emergency Operation Center
- New Local Security Facilities
- Tennessee Tech Construction Manufacturing Building
- ETSU Brown Hall Renovation
- University of Memphis Research Modernization
- TCAT Memphis Aviation Campus Replacement
- UT-Knoxville Chemistry Building
- UT-Martin College of Business and Global Affairs
- Tennessee Administrative Office of the Clerks (AOC) Library and Archives Renovation
- Tennessee Department of Transportation (TDOT)
“Each year the bond bill provides authorization to TDOT to issue bonds, however, these bonds are never issued,” Rep. Gary Hicks explained in committee. “As a practice, the General Assembly appropriates recurring funds equal to 11% of the principal amount of all general obligation bonds that are authorized. The 11% combines and assumes 6% interest and 5% principal payment. With these bonds being issues, Tennessee will continue to be a low-debt state. Our annual debt service will still be only 1.7% of our tax revenue.”
On Tuesday, the bond bill received unanimous votes in the House Finance Subcommittee and the House Finance Full Committee.
That afternoon the Senate Finance, Ways and Means Committee passed the bond bill by an 8-2 vote.
Democrat Senator Yarbro and Republicans Haile, Johnson, Powers, Rose, Stevens, Walley and Watson voted in favor of the bill.
Republican Sen. Hensley and Democrat Sen. Lamar voted against it.
Tennessee lawmakers are hoping to officially pass the budget by the end of this week so they can take up some of the bills previously placed “behind the budget” next week.
About the Author: Adelia Kirchner is a Tennessee resident and reporter for the Tennessee Conservative. Currently the host of Subtle Rampage Podcast, she has also worked for the South Dakota State Legislature and interned for Senator Bill Hagerty’s Office in Nashville, Tennessee. Adelia is The Tennessee Conservative’s on-site reporter for the Tennessee General Assembly. You can reach Adelia at adelia@tennesseeconservativenews.com.
