Gov. Lee's new budget proposal nearly $10 billion less than this year's total
The Lee administration unveiled a subdued state budget proposal Monday that reflects the state's flattening revenue after several years of significant growth.
- But administration priorities remain intact, including plans for school voucher expansion and a franchise tax cut for Tennessee businesses.
Why it matters: There are fewer big-ticket projects in the budget book this year. But state Finance and Administration Commissioner Jim Bryson told reporters that pre-existing savings tucked into past budgets prepared the state for tighter times.
- "We do not need wholesale budget cuts, and we do not need to raid our reserves," he said.
By the numbers: The proposed budget for the upcoming fiscal year comes in at $52.6 billion — nearly $10 billion short of the 2023-2024 budget, which is estimated at $62.5 billion.
What he's saying: "This budget is more challenging than previous budgets and in many ways it's a lot less exciting," Bryson said.
- "[We've gone] from high growth to basically no growth."
- "This budget continues to make key investments in Tennessee, just at a lower level than previous budgets."
🍎 Education: Lee's budget earmarks about $144.2 million in recurring funding for school vouchers, which would allow families to use state funding to pay for private school tuition. The funding would cover voucher costs for 20,000 students.
- The budget would also add $261 million annually to the state's school funding formula.
💰 The franchise tax: Cutting the franchise tax for businesses is expected to reduce revenues by $410 million in the upcoming 2024-25 fiscal year. Officials also expect about $1.2 billion could be doled out in tax refunds for previous years.
- State officials have said the business tax cut is needed to avoid lawsuits from businesses opposed to the tax structure.
- "This extraordinary expense is a major budget item," Bryson said. But, he said, "wise planning and spending restraint" in previous years made it possible to absorb the cost.
🚨 Law enforcement: More than $17 million would go toward adding 60 positions to the Tennessee Highway Patrol.
🥕 Of note: Lee's budget does not include a grocery tax holiday, which took place last year.
What's next: Lee's budget proposal requires legislative approval, and lawmakers are sure to alter it as the session continues.
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