Weekly Update from our Senator
State of Tennessee
CAPITOL HILL WEEK
Senator Dolores Gresham
General Assembly wraps up Special Session
Budget address set for Monday Night
Contact: Darlene Schlicher (615) 741-6336 or email: email@example.com
(NASHVILLE, Tenn.), February 5, 2015 – The first Extraordinary Session of the 109th General Assembly adjourned on Wednesday after three days of legislative deliberations on Governor Bill Haslam’s Insure Tennessee proposal. The action to adjourn came after the Senate Health and Welfare Committee voted 7 to 4 against giving the Governor authorization to enter into a contract with the federal government to expand the number of Tennesseans eligible for Medicaid or healthcare benefits which are available under the Affordable Care Act, also known as Obamacare.
Senate Joint Resolution 7001 would have given the Governor authority to implement TennCare Demonstration Amendment #25, which is a waiver amendment request to provide services to “newly eligibles” between the ages of 19 and 64 with family incomes that do not exceed 138 percent of the federal poverty level. Legislative authorization on the Insure Tennessee proposal was required under a law passed by the General Assembly last year.
The Legislature’s Fiscal Review Committee, which is responsible for analyzing the cost of all legislation with a financial effect on state government, released an analysis on Tuesday showing the Insure Tennessee proposal would increase state spending by $7.8 million in the 2015-16 budget year, $43.6 million in the 2016-17 budget year and $46.2 million in the 2017-18 budget year. It also showed it would increase federal expenditures by $675.3 million in 2015-16, $1.4 billion in 2016-17 and $739 million in the 2017-18. Although the federal government would fund the vast majority of the program, concerns were expressed about the impact the proposal would have on the national debt which now stands at $18 trillion.
Other key concerns expressed by state senators opposing the plan included the absence of a final legal agreement that would bind the Obama administration to provisions in which federal representatives had verbally agreed to in their talks with Governor Haslam’s administration in preparation of the waiver. Of particular concern was the ability of Tennessee to opt out of the program without legal repercussions or loss of federal funding.
In 2005, state lawmakers worked to rein in the escalating cost of TennCare to the state budget from 33 percent to 25 percent due to its negative impact on other critical areas which need funding like education and public safety. There were, however, legal hurdles to that disenrollment. That cost is now back up to 33 percent due to mandates from Washington.
In the 1979-1980 budget the total cost of TennCare was $116 million. The state now puts in more than that amount on an annual basis in just the increased costs, which has averaged $187 million per year over the past four years.
Another key concern for committee members voting against the plan was the number of enrollees projected to be eligible for Insure Tennessee. The original projection in December of 200,000 enrollees has been increased by 20 percent to 280,000. The Bureau of TennCare has stated enrollment is estimated to be 307,600 by the 2017-18 budget year, with other healthcare experts anticipating that population could be as much as 400,000.
In addition, while initially intrigued by some of the free-market aspects of the governor’s plan, many Senators expressed concern that providers would have little incentive to enforce the co-pays in the Volunteer Plan. This would effectively eliminate a key-cost saving measure cited by proponents of the plan.
This year’s Extraordinary Session was the 58th special session in the history of the state. The most recent Extraordinary Session prior to this year was in January 2010, and focused on education.
General Assembly to Reconvene Regular 2015 Legislative Session on Monday as Governor Prepares to Deliver Budget Address
Now that the Special Session is complete, the General Assembly will reconvene the regular session on Monday evening, when lawmakers will gather to hear Governor Bill Haslam’s fifth annual budget address. Rising healthcare costs to the TennCare program combined with inflationary growth for the state’s Basic Education Program have compounded the state’s budget problems during the slow economic recovery. These two items will consume the vast majority of new revenue growth, leaving little discretionary money for improvements for other important state government needs unless other cuts are made. This will make passage of a conservative balanced budget that prioritizes education, job creation, and public safety challenging in 2015.
The State Funding Board met in December to reevaluate Tennessee’s economic condition and set a new growth rate of 2.6 to 3 percent upon which the 2015-16 budget year will be based. This compares to an estimated growth rate of 3.85 to 4.2 percent last year and equates to approximately $300 million in new revenues.
Citizens can view the Governor’s budget address at 6:00 p.m. CST through the General Assembly’s live video stream at http://www.capitol.tn.gov/. A more detailed budget presentation will take place on Tuesday at 8:30 a.m. CST in the Senate Finance, Ways and Means Committee. Viewers can watch that presentation at the same website.
In the meantime, legislation is still being filed for consideration during the regular session. As of noon Thursday, 403 bills have been filed in the Senate and 419 bills have been filed in the House of Representatives. The deadline for filing all general bills for consideration is Thursday, February 12 for both houses. Senate Committees are scheduled to hear several important bills next week, as well as presentations on a number of other important state government matters. This includes a Senate Commerce and Labor Committee hearing on potential forthcoming legislation to authorize municipal electric systems and other governmental utility authorities to provide broadband services.
Brooking Report Heralds Tennessee’s New Labor Education Alignment Program
Tennessee’s new Labor Education Alignment Program (LEAP) has been heralded as a model for other states to follow, according to a new report released on Tuesday by the Brookings Institute, aprivate nonprofit organization devoted to independent research and innovative policy solutions. The competitive grant program provides for cooperative efforts between government, education and businesses to fill the skills gaps in the local workforce pool, while increasing the number of Tennesseans with post-secondary degrees. It allows students at Tennessee's technology centers and colleges the opportunity to combine occupational training in a high-skill or high-technology industry with academic credit and to apply that experience toward a degree.
The report, America’s Advanced Industries: What they are, Where they are and Why they Matter, praises LEAP, along with the state’s Tennessee Promise and Tennessee Reconnect programs. Tennessee Promise provides two years of free attendance for high school graduates at a state community college or college of applied technology (TCATs), while Tennessee Reconnect provides tuition-free certificate training at the state’s TCATs. The three programs bolster the state’s Complete College Tennessee Act and “Drive to 55” initiative with the common goal of raising the percentage of Tennesseans with post-secondary degrees from 32 to 55 percent by 2025.
“States should facilitate and support ‘bottom-up’ efforts to align labor with demand regionally through the workforce development and skills education system,” the report said. “Only through robust partnerships and open channels of communication can the public sector hope to respond to the rapidly changing needs of local advanced industry employers.”
Experts maintain that within the next five years, over half of all jobs in Tennessee will require postsecondary credentials beyond a high school degree.
Taskforce Set To Examine Tennessee Sentencing Structure, Recidivism Rate
A task force formed by Governor Bill Haslam meets Thursday in Nashville to continue studying the state’s sentencing structure and examine ways to reduce Tennessee’s high recidivism rate, or the number of people returning to prison within three years of being released. The goal of the task force is to develop recommendations for the Governor and his cabinet in an effort to improve state corrections laws.
The current sentencing structure in Tennessee has been in place for more than 20 years, with the recidivism rate averaging approximately 45 percent. After the meeting, the task force is expected to release its findings to Governor Bill Haslam by June. At that point, the Governor will make his own recommendations to various state departments and offer changes to state law to the legislature for approval.
Last week, the Council of State Governments (CSG) released a Texas study which showed that juveniles under community-based supervision are far less likely to reoffend than those incarcerated in state correctional facilities.
The study is expected to have significant implications on the operations of state juvenile justice systems across the country, including Tennessee, which experienced the fourth-largest decrease (more than 70 percent) in its incarcerated youth population in its state correctional facilities between 1997 and 2011. Tennessee’s Department of Children’s Services Juvenile Justice Division is already working with the CSG Justice Center to pilot recommendations to improve its data collection.
Earlier this year, Tennessee joined Utah, Pennsylvania, Nebraska and Kansas to test recommendations set forth by two CSG studies which detail what state and local governments can do to improve outcomes for youth in their juvenile justice system. The grant will help the states improve their methods for collecting and analyzing recidivism data and will serve as a model juvenile justice system for other states to emulate.
$1.375 Billion State-Federal Settlement with S&P -- Tennessee Attorney General Herbert Slatery announced this week that Tennessee, the U.S. Department of Justice, 18 states and the District of Columbia have reached a settlement with Standard & Poor's Financial Services LLC (S&P) resolving allegations that S&P misled investors when it rated structured finance securities in the lead-up to the 2008 financial crisis. The settlement requires S&P to pay $1.375 billion to the states and the Department of Justice. Tennessee will receive $25 million for its role as a lead state in the enforcement actions against S&P. The S&P settlement documents may be viewed by going online to www.tn.gov/attorneygeneral and clicking on "Filings of Interest."
Transportation Funding -- The Senate Transportation and Safety Committees and the House Transportation Committees will meet jointly on Wednesday to hear Comptroller Justin Wilson present a report from the Office of Research and Education Accountability: Tennessee Transportation Funding: Challenges and Options. This report is in response to a 2014 request from the Fiscal Review Committee of the Tennessee General Assembly. The purpose of this study is to provide an overview of Tennessee’s current financing system for highways and bridges, outline challenges to the existing system, and review alternative funding methods. The meeting will be held at 1:00 pm CST in Room 12 of the Legislative Plaza.
Industrial Hemp -- The Tennessee Department of Agriculture is now accepting applications from farmers and producers interested in growing industrial hemp. The announcement was made last week and follows enactment of legislation passed last year tasking the department with development of a licensing and inspection program for the production of industrial hemp in Tennessee. Industrial hemp may only be grown as part of a research or pilot project. Industrial hemp has significantly lower tetrahydrocannabinol (THC) content than marijuana and is found in a variety of products, including fabric, textiles, fibers, and foods. More than 30 nations grow industrial hemp as an agricultural commodity.