Daily Dose for May 23, 2006

Daily Dose

What to Do with the Surplus? -- How much of money the state should spend was in question yesterday as legislative leaders met in public and semi-private setting to discuss how much the state should spend with revenue projections from increase in sales tax on the rise. Members yesterday met in an unannounced meeting in House Speaker Jimmy Naifeh's office to discuss the budget. That meeting drew criticism that the Legislature was reverting its old policy of closed door meetings. At issue is whether or not to break the Copeland cap on state spending in order to provide tax a break in the state's sales tax. Other legislative ideas for spending money, including state employee pay raises and increases in state spending to offset higher tuition costs are also on the table. Governor Bredesen seems reluctant to increase spending or include a sales tax break, instead preferring that the surplus go into the state's fiscal reserves. Bredesen's likely Republican opponent Jim Bryson also favors the idea of adding the surplus to the state reserves. Still, GOP leaders, while backing off plans for a one-penny rollback on the sales tax on food, are pushing for some sort of way to return some of the surplus revenue to taxpayers. The possibilities include additional property tax relief for the elderly, that would include more people than the relief plan on the books, or a daylong sales tax holiday are also on the table.

Expanding AccessTN -- The part of Governor Bredesen's health care proposal deemed Cover Tennessee has a high risk pool program called AccessTN that has been getting a lot of attention with TennCare advocates. Gov. Bredesen already has agreed to boost premium assistance from $5 million to $13 million for the AccessTN high-risk insurance pool. But advocates are pushing for $75 million. Tony Garr of the Tennessee Health Care Campaign says that money is needed for the approximately 40,000 people cut from TennCare. Bredesen Finance team seems content at $13 million, however. Jim Shulman, executive assistant to Finance Commissioner Dave Goetz, said the $13 million is "going to make us No. 1 in the country in terms of premium assistance. At this point we’re pretty comfortable with that."

Tobacco Lobby Fighting Tax Swap -- Lobbyists for the tobacco industry have been fighting hard against a bill that would increase the tax on tobacco products and reduce the state sales tax on food. Tobacco interests opposed to the bill have contributed $92,300 to lawmakers since January 2003. Tennesseans for Fair Taxation wants to boost the current 20-cent-per-pack tobacco taxes by 14 cents in exchange for reducing the 6 percent sales tax on food to 5 percent. However, that would cost the state about $72 million, according to a legislative analysis. Senate Republican Leader Ron Ramsey has been the biggest benefactor of the tobacco lobbying, receiving a total of $4,000 through campaign contributions and contributions to his PAC. More on the tax swap bill from the Nashville City Paper.

Alexander Touts TN's Biodiesel Capacity -- Republican Sen. Lamar Alexander, chairman of the Senate Energy Committee, talked with a panel of state biodiesel experts Monday at Nashville Auto Diesel College (NADC) about how to monitor the progress of alternative fuels in Tennessee. “I care a lot about the environment, but I’ve noticed that sometimes the environment — when it’s all by itself — doesn’t come up very high on the list of public concern,” Alexander said. “We have an opportunity to clean the air, stabilize the cost of gasoline, and put money in the pockets of Tennessee farmers.” Gov. Phil Bredesen has included $4 million in his proposed state budget to increase the number of biodiesel and ethanol pumps within the state, but farming representatives say the state still needs its own “crushing” facility that processes the soybeans and extracts the oil.

Posted by Adam Groves | Email This |