It’s raining money in Tennessee as recently-released projections suggest state policymakers could have as much as $3.1 billion EXTRA to allocate when they return for the regular legislative session next week.
This is, of course, a very good position. However, it’s not at all clear the state will allocate those resources into meaningful investments that improve the quality of life in Tennessee.
Take the action on teacher compensation during the special session as an example. Despite early reports that revenue would be higher than anticipated, Gov. Bill Lee’s teacher pay adjustment amounted to roughly 10 cents on the dollar compared to the extra work teachers have been doing during the pandemic. There was little meaningful investment in public schools at all, really.
In case you’re curious about how we got to a place where we have $3.1 billion extra to spend, the Sycamore Institute breaks it down.
In late March 2020, consumer spending in Tennessee dropped 27% below January levels — compared to 32% nationally. Soon after, the state received billions in federal aid designed to provide economic relief to citizens, businesses, and health care providers. After federal stimulus payments and enhanced unemployment benefits began in mid-April, Tennessee’s consumer spending rebounded close to pre-pandemic levels, while spending nationwide remained down by about 16%. (1) (2) Meanwhile, prior changes to state law took effect in July 2020 that led the state to collect sales tax on more internet purchases.
Here’s the breakdown of the extra cash:
Compared to the current budget, the governor and state lawmakers may have about $3.1 billion in additional General Fund revenue† to allocate this session ( Figure 3). Based on the upper end of the annual Funding Board ranges, this includes:
$476 million (non-recurring) from the FY 2020 surplus (8)
$1.1 billion (non-recurring) from projected FY 2021 collections above official budgeted estimates (4)
$1.5 billion (recurring) from the increased FY 2021 base plus projected FY 2022 growth (4)
It’s worth noting here that TACIR — a bipartisan group of policymakers that studies and reports on government activity in the state — reports that Tennessee needs $1.7 billion to adequately fund the BEP.
So, good news! We can afford to make a significant investment that closes this funding gap. I look forward to Gov. Bill Lee’s State of the State next week where he announces that based on these new numbers, he’s making a record-setting investment in public schools and plans to do so throughout the remainder of his term.
But, who am I kidding? Gov. Lee isn’t going to do that. Heck, Lt. Gov. McNally has already talked about finding new ways to offer more tax cuts rather than making new investments.
Tennessee has tried a lot of experiments when it comes to our public schools. One thing we haven’t tried, though, is really investing in them.
For more on education politics and policy in Tennessee, follow @TNEdReport
Originally published at http://tnedreport.com on February 3, 2021.