Senate continues to work on tough issues
facing 2009 legislative session

Tennessee lawmakers continued to make progress on Capitol Hill this week on some of the toughest issues facing the legislature in the 2009 legislative session, including judicial selection and the state’s unemployment compensation fund. The biggest legislative hurdle before adjournment, however, is the state’s budget, which is currently being revised by Governor Phil Bredesen to reflect the loss of another $160 to $300 million in anticipated revenues.

Funding Board lowers estimates — Senate Finance Committee members were briefed by State Comptroller Justin Wilson regarding the latest figures from the state’s Funding Board, which lowered its estimates last week on what the state can expect to receive in revenues for current budget year and the one set to begin on July 1. The Board revised its estimates after April revenues showed a six to seven percent shortfall in sales tax collections and a 23 percent decline in the state’s franchise taxes.

The Funding Board, comprised of the state’s top economists, said Tennessee has continued to experience a major decline in big ticket sales, which has negatively impacted the state’s sales and privilege tax collections. The economists do not expect to see improvement in revenues until the first quarter of the next fiscal year and forecasted a continued decline until that time.

Wilson said that Board’s new estimates for total state taxes show a range of decrease in revenues as low as -9.0 percent, to a high of -8.50 percent for the current budget year. The Board expects only a slight improvement in total state taxes from a low of -.75 percent to a high of .45 percent in the 2009-2010 fiscal year.

The new estimates mean the state’s budget shortfall has now grown by an additional $300 million from the Board’s previous forecast to reach a total gap of approximately $1.4 billion in the current budget year. It also means the governor must go back to work on a plan to cut $160 to $300 million from his state spending plan to meet Tennessee’s Constitutional requirement of a balanced budget. Lawmakers expect a new plan to adjust the budgeting needs by at least $200 million accordingly by May 29.

The Funding Board could not predict the effects of a federal stimulus package on Tennessee’s economy over the next 14 months. Economic experts nationwide have also shown little confidence in predicting a turnaround in the immediate future as a result of the federal American Recovery and Reinvestment Act.

Unemployment legislation advances — Most of the federal stimulus funds contain strings that require states to use the money for mandated purposes. It can also demand passage of legislation not enacted by state legislatures previously as a condition for receiving the stimulus money. An example of such mandates was visible this week with passage of legislation in the Senate Finance Committee on an unemployment compensation bill designed to draw down stimulus funds.

The unemployment bill reduces the time period in which applicants must work to be determined eligible, changes the number of hours for eligibility for part-time workers from 32 to 20, and increases payments to applicants with dependents. The federal stimulus law does not allow states to automatically “sunset” the expansion of benefits when the stimulus money is exhausted. The Department of Labor has determined the bill will cost Tennessee approximately $25 million per year, when the stimulus funds dry up, which causes some to have future concerns for the solvency of the fund.

In addition, the unemployment bill proposes increasing unemployment insurance to maintain solvency of the fund by raising the taxable wage base to $9,000 from $7,000 and adopting a 0.6 percent premium charge. The legislation would also allow for 20 weeks of extended benefits utilizing stimulus funds.

The current Trust Fund stands at just over $200 million. Insolvency would mean federal control of the state’s fund, allowing Washington to dictate future tax rates and wage base thresholds. It would also mean mandatory borrowing with interest from the federal government that could cost businesses more in the long run according to the Bredesen administration. The legislation would generate $220 million in new revenues, a level which Labor Commissioner James Neely says would keep Tennessee from going “into the red” and borrowing from the federal government at interest rates of up to 25 percent.

Judicial Nominating Commission — Several bills advanced in Senate Committees this week to revise the current method for selecting the state’s appellate and Supreme Court judges. The action comes as the Judicial Selection Commission, a component of Tennessee’s current plan for appointing judges, is set to expire next month. Under that plan, called the Tennessee Plan, the commission that nominates judges is selected from lists submitted by various legal organizations to the Speakers of the House and Senate and governor.

Two of the bills, SB 2114 and SB 1573 provide for a 17-member Judicial Nominating Commission that would be limited to 10 attorney members. After being appointed through this process, the judge would stand for approval by the voters who could decide whether or not to “retain” or “replace” them. Currently, citizens vote “yes” or “no” on the ballot regarding the retention of judges.

If voters decide to replace a judge, an interim judge would be appointed by the governor until the next election. At that point, the people could decide who would fill the slot through a popular election, which is the same process by which the state’s trial judges are currently selected.

Another bill, SB 1715 contains the same provisions, but without any contested appellate court elections and the governor would have to choose from the six nominees who come from the Nominating Commission.

All three bills provide public access to every aspect of the nominating process. They also ban lobbyists or employers of lobbyists from serving on the Nominating Commission.

Two bills advance to protect children from abuse

Two bills aimed at protecting children advanced in the State Senate this week, including one measure approved by the Senate Judiciary Committee to set up a Tennessee Second Look Commission to review cases and procedures related to child sexual abuse. The Commission would review cases from the initial report of alleged abuse through to a finding or criminal conviction of abuse. Proponents say the bill is an important first step in understanding how the system fails endangered kids.

The proposal, SB 1534, is one of a series of proposals promoted by actor and child protection activist David Keith, spokesman for the National Association to Protect Children. Last week, Keith told Senate Judiciary Committee members that only two percent of the 750,000 pedophiles identified by computer in the United States have been investigated. He said hundreds of thousands of children are being raped, tortured, filmed and traced through Internet and computer technology.

The 17-member Commission would be administered through the state’s Administrative Office of the Courts (AOC) and would submit a final report by January 1, 2011.

The second bill, which was approved by the full Senate, provides General Sessions, Circuit and Criminal Courts concurrent jurisdiction with Juvenile Courts over prosecutions of child abuse, neglect and endangerment offenses. The legislation is designed to allow a court to act more swiftly to provide protection for endangered kids.

Currently, exclusive jurisdiction in child abuse cases is vested in Juvenile Court. This legislation retains jurisdiction in juvenile court, but allows the prosecutors the discretion to bring the case to another court which might be more appropriate to the crime or that might be able to hear the case quicker.

The bill, SB 1530, now goes to the governor for his signature.

Legislation aims to provide benefits to start-up,
small and medium size businesses

Legislation to establish “The Tennessee Small Business Investment Company Credit Act (TSBIA)” overcame its first hurdle with passage by the Senate Commerce Committee this week. The bill is an effort to provide benefits to small, medium-sized, and start-up businesses that do not enjoy the same economic development incentives that have been provided to the larger companies that invest capital in Tennessee.

The bill, SB 1203, is a proven economic development tool that will channel $120 million to local businesses for expansion and working capital to increase jobs immediately. Insurance companies have large pools of untapped capital. The TSBIA is a mechanism to entice these companies to invest that capital in Tennessee small businesses. .

TSBIA is a forward-looking economic development tool for the future growth and prosperity of a state that focuses on promising small companies and stimulates dynamic economic growth, creating new jobs and generating tax revenues. The economic impact of a TSBIA would begin almost immediately.

Bills in Brief

Green jobs and sustainable buildings — Legislation that encourages the creation of green jobs and sustainable buildings to protect the environment has been approved by the full Senate this week. The bill, SB 1919, expands local power of housing and development agencies to promote economic development through the use of tax increment financing. The legislation creates incentives for local governments to use tax increment financing to pay for energy efficiency costs, encourages sustainable design by including LEED-certification costs within the financing package, and promotes local alternative energy projects that incorporate green design principles. Any local expenditure would be permissive.

Courts / “Good faith exception” — The full Senate approved legislation this week that allows a judge to give a jury access to evidence or facts obtained as a result of a search or seizure which contains a minor technical error. Many states, as well as the federal courts, have enacted what is known as the “common sense” or “good faith exception” to the exclusionary rule regarding suppression of evidence in violation to the Fourth Amendment’s unreasonable search and seizure provision. The bill, SB 518, attempts to balance the scales of justice to a standard embraced by the U.S. Supreme Court in United States v. Leon and Herring v. United States, which was the law in Tennessee prior to 1979. This standard allows the judge and jury to weigh all the facts and still administer justice in an objective manner.

Victims of Crime — Legislation to provide funding for a program that gives victims of crime notification regarding any change in status of the offender was approved by the Senate Finance Committee this week. The bill, SB 1684, creates the Statewide Automated Victim Information and Notification System Fund by adding a $1 litigation tax on all criminal charges. This legislation would raise the necessary funds to keep the program up and running and expand its scope to more Tennessee counties.

Education pays — The full Senate has approved legislation that encourages local education agencies (LEAs) to develop “Education Pays” pilot programs for at-risk students. The idea is for the Pilot Program to provide monetary or other rewards of value for academic achievement funded through private organizations. The measure, SB 482, also encourages the State Board of Education to study the effects of any such programs in Tennessee and from other states and report its findings to the General Assembly. Several localities across the country have been successful in implementing such programs to ensure that the right incentives are in place to reward good behavior for high risk youth.

Second Amendment Rights / Parks — Legislation met the final approval of the Senate this week to allow legal gun carry permit holders to posses a firearm in state or federal parks in Tennessee. The legislation, SB 976, also allows local government bodies to maintain control of concealed carry within local parks. According to a report from the U.S. Department of Interior, there were 8 murders, 43 forcible rapes, 57 robberies and 274 instances of aggravated assault in parks nationwide in 2007. In January, the federal government lifted a regulation that banned guns in national parks and wildlife refuges.

Division of Intellectual Disabilities — Legislation to rename the state’s Division of Mental Retardation Services the “Division of Intellectual Disabilities” has received final approval in the State Senate. The initiative began with Special Olympics and other advocates for intellectually challenged individuals to change any derogatory use of the word “retardation” from the country’s vocabulary, beginning with references in government programs or services. The bill, SB 1121, was supported by the Department of Mental Retardation Advisory Council which is made up of disability advocates, family members, providers, and consumers who voted in favor of supporting this initiative earlier this year. Due to cost factors, the name of the Division will be changed as new volumes of Tennessee’s laws are replaced and supplements are published.

Micro-stamping — The Judiciary Committee has approved SB 1908 to prohibit the sale of “micro-stamped” firearms or ammunition in Tennessee. Although micro-stamping legislation supporters claim it will help police solve crimes, many believe their real purpose is to price handguns beyond the reach of many Americans, by requiring firearms to be made with the gadgetry necessary to create the markings or to ban handguns by requiring that they “micro-stamp” more consistently than is technologically possible.

Real ID — The State Senate voted this week to make Tennessee the 12th state in the U.S. prohibiting the issuance of a REAL ID card. The bill, SB 1934, directs the Tennessee Department of Safety not to implement the provisions of the federal REAL ID program. The REAL ID Act was signed into law in 2005.  The federal initiative forces states to standardize driver’s licenses cards across the nation into a single national identity card and database.  It does this by stipulating that state driver’s licenses and state ID cards will not be accepted for “federal purposes” unless they are in compliance with the Act. If implemented, it would cost the state $30 million.

Government transparency — Legislation to provide oversight for Tennessee’s government transparency website advanced in the Senate Finance Committee this week. The bill, SB 149, would make the website subject to audit by the State Comptroller’s office. Members of the General Assembly have pushed for an open government website where citizens can see how tax revenues are spent, and the website was implemented earlier this year. This legislation provides for oversight of the website by the Comptroller’s office.

Preferred Provider Organization Transparency Act — The Senate Finance and Commerce Committee has approved legislation this week named the “Preferred Provider Organization Transparency Act.” The bill makes sure that health care providers who contract with health insurance plans have full knowledge of any entities associated with the insurance company with whom they would be paid. Under the bill, SB 693, the third party would be required to inform the contracting health care provider of a Web site on which they may get information about any changes in the health plan status. This includes to whom the third party has granted access to the provider’s health care services and contractual discounts. The bill will also help doctors know to whom they can address any problems.

Rules of the Road — Legislation, SB 289, adding two dangerous traffic violations to the list of current violations which are penalized under a Class A and Class B misdemeanors has been approved by the full Senate this week. The violations include crossing a double yellow line to hit another vehicle head-on and cutting off a vehicle while passing. The penalty would be a Class A misdemeanor if another person is killed and a Class B misdemeanor if a person is seriously injured.

ICE — The Senate Judiciary Committee has approved legislation calling for Tennessee jails to send information to the federal Immigration and Customs Enforcement office (ICE) regarding prisoners who do not have documentation that they are in the U.S. legally. The bill, SB 1141, requires the jail keeper to fax, email or send a copy of the booking information within three business days of the person’s arrest.

# # #

This entry was posted on Monday, May 25th, 2009 at 8:58 am and is filed under Capitol Updates.
 Email This Post