The 108th Tennessee General Assembly has adjourned for the year, and I am excited to tell you that in the final days of the session, legislators overwhelmingly approved the “Tennessee Promise.”
Earlier this year, I proposed the Tennessee Promise to encourage more Tennesseans to further their education beyond high school. The plan promises beginning in 2015, high school graduates can attend a community college or college of applied technology absolutely free of tuition and fees.
The promise won’t be paid for using tax dollars but instead will be funded through excess reserve funds generated by the state lottery.
We are the only state in the country that will be making this promise. It makes a clear statement to Tennessee families that education beyond high school is a priority in our state. It is a bold promise that will make college a reality for more high school graduates. It speaks volumes to current and prospective employers, and it will make a difference for generations of Tennesseans.
The General Assembly also approved our balanced budget proposal. In early April, we proposed changes to our administration’s original budget proposal after sales tax and business tax collections failed to meet estimates.
Franchise and excise taxes – a type of business tax – which are often volatile are down $215 million due to overpayments by businesses last year that are now resulting in credits and refunds.
It is important to know, however, that Tennessee’s economy continues to be strong even as revenue collections have come in under estimates. Tennessee businesses are performing well and continue to make decisions to create more jobs here. What we’re seeing is a drop in business tax collections resulting from the reconciliation of overpayments that were made in the past.
Our state also depends heavily on sales tax, and because so much commerce has shifted online without us being able to collect a majority of the taxes owed, that also continues to have a negative impact on our budget year in and year out.
In working with the Legislature, we met the challenges presented by lower revenues head on by making tough decisions to balance the budget. Government is usually not about making choices between good things and bad things. It is often about choosing between two good programs or ideas. It is our job to provide the very best service at the very lowest cost to Tennessee taxpayers, and we take that job seriously.
I am grateful to Lt. Gov. Ron Ramsey (R-Blountville) and House Speaker Beth Harwell (R-Nashville) for their leadership, and I appreciate Majority Leaders Mark Norris (R-Collierville) and Gerald McCormick (R-Chattanooga) for all of their hard work this session.
We will continue to focus on the things that matter to Tennesseans: high-quality, good paying jobs, quality education opportunities and a well-managed state government.