07/14/2002

From July 4.
It's not official yet, but it should be soon. Governor Sundquist hasn't signed the bill. All indications are that he will sign it today and that our unnecessary and uncomfortable furlough will be over. We will probably be back at work Friday morning. We'll telephone you to confirm it, but you should hear in the news real soon that state employees are to report back to work Friday.

PS. The Jackson server is down, so for the moment we need to use the personal email addresses for the folks in West Tennessee.
MTAS JACKSON

David Angerer davidangerer36012@yahoo.com
John Chlarson john-chlarson@webtv.net
Roy Eckert rickeckert3@yahoo.com
Brenda Moss bmoss2@earthlink.net
Ronnie Neill rneill@midsouth.rr.com
Dick Phebus rphebus@aeneas.net
Steve Wyatt cbwyatt@charter.net

Here's the detailed explanation from TML.

TENNESSEE MUNICIPAL LEAGUE
Special Budget Update

July 3, 2002

Budget approved! Shared-revenues, critical services remain completely intact

For the first time in awhile, the only calls needed over the next few days
are calls of thanks to legislators for preserving critical shared revenues
and services, programs, and grants of importance to local governments.

This year's unimaginably grueling budget fight finally came to an inglorious
end tonight when the House and Senate finally approved a tax bill producing
enough revenue to fund a "status-quo" budget.  Spending will continue at
last year's levels, including $40 million in grants to local governments
slated to be cut, plus new revenue to fund statutorily required increases,
court orders, and federal mandates.

The compromise tax bill assembled in the last 24 hours is not without its
shortcomings. It funds the budget and leaves local governments revenues
whole, but it does not fix structural imbalances that have plagued Tennessee
for years and it exacerbates border tax leakage problems.  The bill, SB 3110
(Cooper)/HB 3046 (Curtiss), was approved by the Senate on a 22-11-0 vote.
The House approved the measure without a vote to spare.  The tally in the
House was 50-41-7.

The tax bill contains the following provisions.
* Increase state sales tax 1 cent to 7 cents.
o Leave food taxed at 6 cents.
o Keep revenues attributable to the rate increase for state purposes,
but leave intact the current municipal share of the state sales tax.
* Increase single article cap to $3,200, with the state taxing portion
of sales above $1,600 up to $3,200 at a uniform rate of 2.75%.
* Commercial license plate registration fee schedule changes.
* Decouple state corporate tax from federal depreciation schedules.
* Increase corporate excise tax by .5% to 6.5%.
* Increase sin taxes 10% across the board.
* Institute coin-operated amusement tax.
* Impose sales tax on vending machine sales.
* Increase professional privilege tax by $200 (to $400), but exempt
state employees from the increased amount.
* Increase local business tax rate schedules by 50%, with the state
recapturing new revenues attributable to the 50% rate increases.
* Repeal authority for cities and counties to levy business taxes at
rates lower than the standard rate schedules.  (Note: for local governments
currently levying businesses taxes at rates below the standard schedule,
this will result in modest revenue increases for local governments).
Senate assembles strong majority. Clearly, if the Cooper compromise plan had
been presented a month ago, or even a few days ago, it would have fallen far
short in both houses.  Three days into the new fiscal year, with thousands
of state employees furloughed and a full government shutdown looming, what
was impossible a few days before suddenly became possible.

Senators voting for the plan were:

Ben Atchley, Tim Burchett, Charlotte Burks, Bobby Carter, Bill Clabough,
Steve Cohen, Jerry Cooper, Rusty Crowe, Ward Crutchfield, Roscoe Dixon, John
Ford, David Fowler, Jo Ann Graves, Thelma Harper, Tommy Haun, Joe Haynes,
Douglas Henry, Jeff Miller, Ron Ramsey, Larry Trail, Mike Williams, and John
Wilder.

Senators voting against the plan were:

Marsha Blackburn, Lincoln Davis, Gene Elsea, Roy Herron, Doug Jackson,
Rosalind Kurita, Jim Kyle, Randy McNally, Mark Norris, Curtis Person, and
Bob Rochelle.

Throughout the session, each Senator helped local governments on a number of
issues.  In all likelihood, the budget impasse would have turned out very
badly for local governments without the hard work of Senators Jerry Cooper
and Bill Clabough, who worked with Lt. Gov. John Wilder to break the logjam
and build a coalition of the 22 legislators voting to fund the "status quo
budget." Among Senators voting against the budget bill, Gene Elsea, Roy
Herron, and Bob Rochelle were particularly strong advocates of local
governments all session.

It was too close to call in House. A few hours before the vote was taken in
the House, the plan was far short of a majority, with confirmed yes votes in
the range of 40.  After hours of debate and just minutes before the vote was
finally taken, it was still very unclear if the House had enough votes to
pass the plan.

With the CATS plan having failed and the income tax having failed, if this
plan fell short, the only thing left would be the DOGS budget or a complete
government shutdown.

Ultimately, many of those legislators most adamantly opposed to a sales tax
increase were forced to vote for this plan to avert disaster.  A number of
legislators who had voted yes on the Speaker's income tax plan had to cast a
tough vote to muster a 50-vote majority. Those legislators include, Speaker
Jimmy Naifeh and Reps. Rob Briley, Ronnie Cole, Charlie Curtiss, Ronnie
Davis, Matt Kisber, Butch Lewis, Steve McDaniel, Bob Patton, Raymond Walker,
and Zane Whitson.

A number of legislators voting no on the compromise plan were equally strong
advocates for local governments.  During recent committee meetings and floor
sessions, a number of legislators stood up for local governments.  Those
include, but are certainly not limited to, Reps. Ulysses Jones, Harry
Tindell, Tommie Brown, Carol Chumney, Craig Fitzhugh, Ken Givens, Randy
Rinks, and Johnny Shaw.  Reps. Doug Overbey, Bob McKee, Chris Newton, and
Charlie Sargent were among the many legislators who voted for the compromise
plan in large part to avoid the potential for damaging cuts and redirections
of revenue.

Representative voting for the plan were:

William Baird, H.E. Bittle, Jim Boyer, Rob Briley, Frank Buck, Dewayne
Bunch, Steve Buttry, Chris Clem, Ronnie Cole, Charlie Curtiss, Gene
Davidson, David Davis, Dennis Ferguson, Stancil Ford, George Fraley, Tim
Garrett, Steve Godsey, Jamie Hagood, Tre Hargett, Jere Hargrove, Beth
Halteman-Harwell, John Hood, Russell Johnson, Sherry Jones, Matt Kisber,
Butch Lewis, Joe McCord, Steve McDaniel, Bob McKee, Richard Montgomery,
Jason Mumpower, Chris Newton, Doug Overbey, Bob Patton, Bubba Pleasant,
Dennis Roach, Charlie Sargent, Larry Scroggs, Jack Sharp, David Shepard,
Paul Stanley, John Tidwell, Mike Turner, Ray Walker, Ben West, Zane Whitson,
Les Winningham, Bobby Wood, and Speaker Jimmy Naifeh.

Representative voting against the plan were:

Mae Beavers, Diane Black, Stratton Bone, Kathryn Bowers, Henri Brooks,
Tommie Brown, Gene Caldwell, Glen Casada, Carol Chumney, John DeBerry, Lois
DeBerry, Bill Dunn, Craig Fitzhugh, Joe Fowlkes, Ken Givens, Mark Goins,
Tommy Head, Ulysses Jones, Joe Kent, Mike Kernell, Mark Maddox, Mike
McDonald, Kim McMillan, Larry Miller, Gary Odom, Pete Phillips, Phillip
Pinion, Mary Pruitt, Don Ridgeway, Randy Rinks, Donna Rowland, Bobby Sands,
Johnny Shaw, Harry Tindell, Curry Todd, Joe Towns, Brenda Turner, Larry
Turner, Jim Vincent, John White, and John Mark Windle.

Representatives abstaining were:

Joe Armstrong, John Arriola, Ralph Cole, Barbara Cooper (excused absence),
Ralph Cole, Edith Langster, Shelby Rhinehart (excused absence), and Paul
Phelan.

Appropriations bill. After voting to provide new revenues for state
government, the legislature debated the other pieces of the budget package -
the appropriations bill and the bond bill.  Both passed after lengthy
debate.  With all pieces of the budget approved, state government will
emerge from its partial shutdown and anxious local officials can go about
the business of municipal government once again.

Almost done. Having wrapped up the year's most difficult task, adopting a
budget, the General Assembly will return for more committee meetings and
floor sessions tomorrow morning at 8:30 a.m. to attend to unfinished
business.  Despite being somewhat battered and bruised by a horribly
difficult session, TML legislative staff will be there, as always, working
to protect and promote city government.

ACTION NEEDED: NONE, apart from calls and letters of thanks.  While the
final budget is, in many ways, nothing to be too proud of, legislators did
manage to narrowly avoid a calamitous meltdown.  For some time, that
meltdown, in the form of a DOGS budget or a complete government shutdown,
was beginning to look like a real possibility.  Please keep in mind that in
all likelihood, this year's budget solution will leave us with plenty of
trouble next year or soon thereafter.  Local government officials will need
to build even stronger relationships for the next budget battle, which will
probably come all too soon.