Tennessee Gov. Bill Lee on Thursday outlined new spending plans for state government that reflect significant revenue reductions due to the economic impact of COVID-19.
Department of Finance and Administration Commissioner Butch Eley presented state lawmakers with the revised budget plans for the current fiscal year, as well as FY 2020-21, which begins July 1, 2020, and a framework for the following fiscal year, 2021-22.
“We will balance our budget each year while providing important services to our citizens,” Eley said in a statement.
“We’re adjusting to the immediate impact of the pandemic on state revenues of up to $1.5 billion through the end of the next fiscal year, planning for the worst and hoping for the best. Tennessee has a history of being one of the best managed states in the nation, and we intend to work with the Legislature to continue that tradition, maintaining low taxes and preserving reserves while achieving efficiencies in operations and continuing to serve our citizens.”
In March, the administration and the General Assembly agreed on $397 million in recurring reductions at the onset of COVID-19, and the administration is proposing an additional $284 million in reductions for FY 20-21, bringing the total to $681 million in reductions. Hiring and expenditure freezes have also been in place since March. The state will close the current fiscal year on June 30 with unbudgeted non-tax revenues, agency savings and reserves, the press release said.
In FY 20-21, the state will utilize reserves to lessen the impact of immediate spending reductions, allowing for thoughtful review of business practices for greater efficiencies and creative delivery of vital services as well as the development of strategic plans to reduce the employee workforce over the next two years, according to the press release.
The state’s multi-year spending plan provides full funding for:
• The Basic Education Program (BEP) for K-12 public schools
• Contributions to the state employee pension fund
• State payments for employee health insurance
• Debt service requirements
Multi-year reductions will happen, in part, through, among other things, up to 12 percent reductions through greater efficiencies in all departments and a reduction in new capital projects and funding for capital maintenance.
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Chris Butler is an investigative journalist at The Tennessee Star. Follow Chris on Facebook. Email tips to [email protected].
If Bill Lee has to use state funds to hold the Republican Convention in Nashville and to pay for the costly security apparatus to protect delegates, there is no way he can avoid big state spending. Lee will have a hard time squaring funding for his Republican Convention project with cuts for far more essential services such as medical care, public safety, public transportation, care of city and state parks, road upkeep, etc. So much for Lee’s proposed spending cuts!
But Bill Lee is getting a RAISE this year, along with others in high places in Tennessee state government. The Gravy Train rolls on!