Live from Music Row Wednesday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed Jordan Long of the Beacon Center to the newsmaker line to discuss their approach to a conservative budget solution for Tennessee.
Leahy: On the newsmaker line right now, Jordan Long, the director of government relations for The Beacon Center. Good morning, Jordan.
Long: Good morning, Michael. Thanks for having me.
Leahy: Thanks so very much for being with us today. You have a conservative budget for the state of Tennessee. Tell us about that.
Long: That’s right, Michael. Beacon is excited about having this publication from the Beacon Center that sets the maximum dollar amount that states spend in the next fiscal year. And we believe that the budget that the state spends should not increase year over year the burden on taxpayers.
The budget increases year over year, of course. And calculating this conservative budget, we use population growth and inflation to get the next number.
And we use those two numbers like I said because we don’t believe that the burden on taxpayers should increase without this increase in population or inflation. So we’re excited because we want to freeze real capita appropriations while covering the same essential government provisions.
Leahy: So what’s going to happen with this conservative budget proposal?
Long: The Beacon is going to publish this conservative budget proposal, and it’s going to show that year over year, there’s a six percent growth in the budget.
That’s a population growth plus inflation in the legislature next year for the 2022-2023 budget should be no greater than $45.16 billion.
Leahy: Will the Tennessee General Assembly respond to this? How are they going to respond to it?
Long: I think they’ll respond well because looking back over the last decade, the state has met this number had it been published nine out of ten times. So the Legislature historically has done a good job in having a conservative budget.
Of course, some of the federal funds that come in will pose a bit of a challenge to this. But what the Beacon plans to do with this report is to exclude from the spending amount deposits into the rainy day fund so that we can get to that 10 percent number that we need to be at.
Or to the TennCare reserve or to other trust funds that have been set up like the Mental Health Trust Fund, because those are savings they’re not really spending.
Leahy: Crom Carmichael is the original all-star panelist in studio with us. Crom, what question do you have for Jordan and The Beacon Center and this conservative budget for Tennessee?
Carmichael: Well, I don’t know. I think Tennessee is fiscally extremely well managed to begin with. And so my sense of it is what The Beacons Center is doing is trying to fine-tune and make it even better.
But I would encourage The Beacon Center to cast a little bit wider net in terms of what kind of reforms we need to have in Tennessee to make us a better state.
And I’d like for The Beacon Center to consider the call for the elimination of teachers’ unions. I think we can do that legislatively.
I’d like to do away with government employee unions because then you free the Democrats to actually think beyond their core constituency, which is about five people who determine where the union dues will go.
And that’s what’s wrong with the Nashville Democrat Party. There are only about five people who determine where all of this vast amount of government employee forced dues, by the way. Forced dues. Where all that money goes.
And so rather than try to reform that I would see that as a systemic problem. And let’s cut the snake off at the head which is the elimination of the teachers’ unions.
By the way, the teachers themselves, want to teach and they want to do a good job. They’re not allowed to. They’re being forced to be bad teachers because of the teachers’ unions.
Leahy: Jordan Long, let me ask you about this. What Crom says makes perfect sense to me. It seems to me to be a very bold proposal. Is that something that The Beacon Center would consider?
Long: Yes, Michael, I don’t know. We’ve got a great policy arm of The Beacon Center, and that’s something that they’re much more apt to take up. But I will say to Crom in terms of the conservative budget.
One of the thoughts that we have in addition to these contributions like the rainy day fund and TennCare reserve is to have corporate tax reform, franchise and excess tax, and business tax reform so that we can make Tennessee an even friendlier business state and have businesses and workers here that can continue to live their version of the American Dream.
Carmichael: I’m 100 percent behind that. And I’m wondering, can you be a little bit more specific? Why don’t you tell our listeners what the current corporate tax rate is and what The Beacon Center is proposing?
Long: The Beacon has just proposed generally to reform some of the corporate tax in Tennessee in terms of franchise and excise tax. It can be a little bit complicated to even just fill that form out.
I believe Tennessee’s corporate tax rate is six and a half percent. And so what we’d like to do is we want to continue to be competitive in that nature. And as far as business tax in the general Southeast, we’re not as competitive as we could be.
Carmichael: So where would you like that six percent or six and a half percent to be?
Long: Yes. I don’t think that we’ve actually landed on a number. That would be a good conversation between a lot of departments. The Department of Revenue and Finance Administration. But in addition to business tax reform, we would also like to see the repealed professional privilege tax.
Leahy: I got one last question for you, Jordan Long. I don’t know if you’d follow this, but the Commissioner of Education, Penny Schwinn is going on a statewide tour to eight cities. She’s going around and she’s doing town halls. The idea is purportedly to talk about changes to the BEP.
The Basic Education Program funding level. The only people speaking at those town halls are teachers and former teachers. And they’re basically asking for more money. Do you anticipate that there’s going to be a huge increase in requests for education funding when the Tennessee General Assembly meets next January?
Long: I watched the budget hearing by the Department of Education yesterday, and they gave some great information as far as some of the things that the legislature did last year in the education special session to try to make up for lost ground during the pandemic.
It sounded like the commissioner did talk about her bus tour and talked about some positive feedback that they had been getting. But in addition to that during the budget hearing, it sounded like their plan was just to expand the program. Some of the programs that they had been doing included more students.
Leahy: Jordan Long with The Beacon Center, director of government relations. Thanks so much for joining us. I appreciate it. Come back again. If you would.
Long: Thank you, Michael.
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