The pace quickened on Capitol Hill during the week of January 27th as lawmakers put the finishing touches on legislative proposals before bill filing deadline on February 6th. Senate committees also heard testimony regarding several important issues before the General Assembly, including Tennessee’s health status and progress being made to ensure mental health parity. In other action, state senators advanced a Right to Work Constitutional Amendment resolution and first-time homeowners.
The General Assembly met in a joint session in the Tennessee State Capitol on February 3rd to hear Governor Bill Lee’s second State of the State address, where he unveiled his budget proposal for the 2020-2021 fiscal year. Passage of a conservative balanced budget that highlights education improvements, job creation, and public safety is a top priority for lawmakers this year and is the only duty prescribed for the General Assembly in the state’s constitution. This year’s budget proposal is aided by the fact that Tennessee’s finances are the healthiest in state history and enjoys the highest ranking of the nation’s top credit rating agencies. There will be more details on the Governor’s budget to come.
Tennessee is among the five least indebted states in the nation per capita, ranks third for best-funded pension plans and is one of only five states without road debt. The state’s financial status is also boosted by record low unemployment rates, rising educational achievement, robust job growth and a healthy economy.
Senate Finance, Ways and Means Committee members will get down to work studying budget details during the week of February 3rd with an overview of the governor’s plan scheduled from Department of Finance and Administration Commissioner Stuart McWhorter. The budget will continue to be front and center for the remainder of the 2020 legislative session. Senate committees are set to hear the individual budgets of 60 departments or agencies of state government between February 11 and March 11.
Right to work amendment advances in Tennessee Senate
A Tennessee Right to Work Constitutional Amendment is one step closer to passage after receiving overwhelming approval in the Senate Commerce and Labor Committee. Senate Joint Resolution 648 would guarantee future generations of Tennessee workers their right to work regardless of whether they choose to join a union.
Twenty-seven other states have enacted such laws, with nine adopting constitutional amendments. This includes neighboring states Arkansas, Mississippi, and Alabama. Another of Tennessee’s neighbors, Virginia, is presently considering repealing its Right to Work statute. A constitutional amendment in Tennessee would offer greater protection for workers against such repeal efforts in the Volunteer State.
The resolution now goes to the floor of the Senate where it will be read three times before a vote is taken. The resolution must pass the General Assembly by a simple majority this year and by a two-thirds majority during the 2021 or 2022 legislative session in order to appear on the ballot for a statewide referendum in November 2022. The amendment would become part of the state constitution if adopted by a majority of votes cast in the governor’s election.
Legislation would raise debt limit for low interest mortgage program serving first-time homebuyers and veterans
The Senate State and Local Government Committee has approved Senate Bill 1576 to increase the Tennessee Housing Development Authority’s (THDA) Great Choice Mortgage Program’s debt limit. The program, which uses tax-exempt bonds to make low-interest mortgages to first-time homebuyers and veterans, was created to make homeownership more available and affordable for Tennesseans.
The Tennessee General Assembly has increased the debt limit for the Great Choice Mortgage Program 12 times since 1973, recognizing the value of the program. In 2019, the Great Choice Mortgage Program issued 4,500 mortgages to new homebuyer and veterans. The program is expected to reach its $2.9 billion debt limit in early 2020. The legislation would raise the maximum aggregate principal amount for which the agency may issue bonds to $5 billion.
THDA Executive Director Ralph Perry says the need for the legislation comes from an increase in the business the Great Choice Mortgage Program is doing. Perry notes that while the program has tripled its loan volume over the last three to four years, the average credit score is up and loan delinquency is down.
The bill now goes to the Senate floor for final consideration.