Of the more than $1.1 million in government-funded waste, fraud and abuse reported through the Tennessee Comptroller’s anonymous tipster hotline last fiscal year, more than 85 percent of that “record achievement” came from just two cases.
One in Benton County and the other in Marion County, they involved more than $960,000 in alleged fleecing of public funds.
According to a “special investigation” report published by the Comptroller’s office last July, “various employees misappropriated at least $228,980” between 2009 and 2014. The report noted that while the two Marion County housing authority programs were “separate legal entities,” they shared the same office space and staff.
“The amount of theft in this case is alarming,” Comptroller Justin P. Wilson said in a press release at the time. “While it’s easy to blame the criminal behavior of two individuals, housing authority officials must also take the necessary steps to shore up a number of issues which allowed these thefts to occur.”
In the other case, about $733,000 in “unauthorized administrative disbursements” was uncovered subsequent to investigators probing a Benton County nonprofit that was raking in government money through the Tennessee Department of Human Services.
The Comptroller’s office issued a report in March alleging that managers and employees of ABC Nutrition Program in Camden — a food-for-needy-children program run from a home basement by a woman and her two adult daughters — improperly collected compensation and bonuses to the tune of more than $606,000.
Another $127,000 or so was obtained by ABC Nutrition to pay for “unauthorized construction and improvement disbursements” for the woman’s home, as well as “additional unauthorized administrative disbursements.”
Participants in the operations in both South Pittsburg and Camden are facing criminal charges.
“Since its inception (in 1983), the hotline has received over 21,000 notifications, including 951 notifications between July 1, 2014, and June 30, 2015,” according to an information sheet provided to TNReport by the state Comptroller’s office. “The hotline received 779 telephone calls and 172 submissions through the online reporting website. Of the 951 total notifications, 486 concerned substantive allegations of fraud, waste, or abuse.”
Republicans in the Tennessee House of Representatives appear to be formally preparing for possible disciplinary action against a ranking member of their caucus.
In a statement released to the media Thursday morning, GOP Caucus Chairman Glen Casada of Thompson Station announced that he is requesting a special meeting of the 73-member strong House supermajority when the Legislature convenes next month.
On the agenda would be a discussion about recently reported controversies surrounding Casada’s fellow Williamson County lawmaker, Jeremy Durham, who currently serves as the House majority whip.
“As Chairman of the Republican Caucus, I am calling a meeting to be held on January 12th to discuss upcoming legislative issues and the leadership position of Majority Whip,” Casada said in an emailed statement through the GOP Caucus communications office.
Durham has been drawing scrutiny for a couple of unrelated incidents that occurred in 2013 and 2014.
“This situation is from two and a half years ago and was fully vetted by 12 Williamson County citizens who quickly agreed that nothing illegal occurred,” Durham said in response to publicity the case has garnered. “I possessed two additional valid and current prescriptions for the same medication and dosage in question and never attempted to obtain anything I had not been prescribed by a doctor.”
Following press accounts of the case last week on the heels of stories about the grand jury’s consideration of the prescription forgery accusation, Durham said, “It’s pretty clear that the liberal media is just on another witch hunt.”
In a statement issued early Thursday afternoon, House Majority Leader Gerald McCormick, R-Chattanooga, said:
“I have received a number of requests from members of our Caucus for a full Caucus meeting to discuss Rep. Durham’s status as a member of Leadership. Certainly we will honor those requests and have a meeting to discuss this issue. I’m looking forward to putting this distraction behind us and moving on with the business of the state.”
Gov. Bill Haslam voiced support Monday for the University of Tennessee’s Knoxville campus chancellor, Jimmy Cheek, who is facing resignation demands from GOP state lawmakers.
“My view is that you judge somebody on their entire body of work, and if you look at what Chancellor Cheek has done at UT, his entire body of work is impressive,” Haslam told reporters following a ribbon-cutting for a new Under Armor distribution center in Mt. Juliet.
Included was a suggestion that participants at workplace parties refrain from playing “games with religious and cultural themes – for example, ‘Dreidel’ or ‘Secret Santa.'”
“If you want to exchange gifts, then refer to it in a general way, such as a practical joke gift exchange or secret gift exchange,” the post went on.
“Holiday parties and celebrations should celebrate and build upon workplace relationships and team morale with no emphasis on religion or culture,” counseled the diversity office. “Ensure your holiday party is not a Christmas party in disguise.”
Lt. Gov. Ron Ramsey and Senate Education Chairwoman Dolores Gresham are among those indicating they’ll press for Chancellor Cheek’s ouster if he had foreknowledge of the diversity office’s post.
“The Office of Diversity is not welcoming to all and hostile to none as they claim,” Gresham, R-Somerville, said in a press release Friday. “They are very hostile to students and other Tennesseans with Christian and conservative values. By placing a virtual religious test regarding holiday events at this campus, every student who is a Christian is penalized.”
Sen. Mike Bell dittoed Gresham’s indignation.
“This is a public university, supported by taxpayer dollars, where the precious resources provided to them should be directed at what we are doing to give our students a world class education,” said Bell, a Republican from Riceville who serves as Government Operations Committee chairman. “The people want us to ensure that their money is being spent wisely and we have lost confidence that this is being done.”
Ramsey, the Senate’s presiding legislator, took to Facebook on Friday to vent his vexation. “If this post was approved by Chancellor Cheek, he should resign. If not, the entire staff of the Office for Diversity and Inclusion should be dismissed. The reputation of Tennessee is at stake here.”
The Tennessee Republican Party’s state executive committee on Saturday approved a resolution calling on lawmakers and the governor to “eliminate funding for the University of Tennessee Office of Diversity and Inclusion in future state budgets.”
Rep. Micah Van Huss, R-Jonesborough, looks to be planning to introduce legislation that’ll do just that.
This isn’t the first time the diversity office has drawn Republican ire. Last summer GOP lawmakers were angered when the office posted a “gender-neutral” language guide for avoiding gender-specific pronouns.
With respect to the diversity office’s future, Haslam on Monday said he continues to see “a role for them.”
The office ought to prioritize “making certain there is equal opportunity for people to attend UT, and graduating, and having great outcomes,” said the governor, who is a Republican and formerly the mayor of Knoxville.
Haslam does think the diversity office “went too far in telling adults how they should act at holiday parties.”
“In this case, I believe they went off into something that they didn’t need to be focused on,” he said.
Gov. Bill Haslam is scheduled Monday to launch preliminary budget hearings with the various high-ranking administration officials whose departments make up the bulk of Tennessee state government.
Haslam’s Department of Finance staff, led by Commissioner Larry Martin, will assist the governor during the hearings, as will Chief Operating Officer Greg Adams and State Budget Director David Thurman.
As has typically been the case during his five-year tenure thus far, the Republican governor is asking that agency heads calculate spending-reduction “contingency” plans that are lower than last year’s outlays.
In August, Commissioner Martin instructed departments to plot out reductions of 3.5 percent “that will not affect the over appropriations,” wrote Department of Finance spokeswoman Lola Potter in an email to TNReport last week. Agency heads have also been tasked with listing “base reductions that would offset a proposed cost increase request.”
During much of Haslam’s time as governor, the state’s economy performed below expectations, and therefore brought in less tax revenue than anticipated. This year, however, state government is collecting more taxpayer dollars than anticipated when the current fiscal year spending plan was finalized last spring.
The Haslam administration budget hearings will commence Monday morning and continue each day of the week until completion on Friday afternoon. The proceedings can either be viewed live online or later as archived files.
Below it the schedule:
Monday, November 30, 2015
9:45-10:45 a.m. Human Services
10:45-11:15 a.m. Tourist Development
2:45-3:15 p.m. Financial Institutions
3:15-3:45 p.m. Commerce and Insurance
3:45-4:45 p.m. Economic & Community Development
The Republican Governors Association held leadership elections in Las Vegas this week, thus capping off Tennessee Gov. Bill Haslam’s year-long stint chairing the organization.
With the election this month of Matt Biven in Kentucky, there are now 32 sitting or soon-to-be-sitting Republican governors in the United States. That number could change depending on the outcome Saturday of Louisiana’s gubernatorial runoff. (Update, 11/22: Democrat John Bel Edwards won Louisiana’s race for governor.)
Haslam called Martinez “one of the Republican Party’s best leaders” and “an outstanding choice to lead the RGA for the next year.”
“She has made the tough decisions necessary to move New Mexico forward and knows what it takes to win in a blue state, a skill that will be vital to ensuring our governors and candidates have the resources they need to win in 2016,” said Haslam.
Tennessee’s governor also praised Gov. Walker’s record, calling it “enormously impressive.” Haslam noted that Walker, too, has triumphed in three elections in what’s traditionally been a Democrat-leaning state, and has done so by challenging organized labor.
Since first securing the Badger State’s highest public office in 2010, Walker, who survived a 2012 recall effort and won reelection last year, “has not shied away from any battle, even taking on the labor unions, in order to build a better tomorrow for Wisconsin,” said Haslam.
Now that Haslam is no longer leading the RGA, he may feel freer to stump for a GOP presidential candidate of his liking. When asked in the past who he favors in the crowded Republican primary field, Haslam has declined to answer.
“It’s probably best for me to stay out of it until I am either not in this role (as RGA chairman) or that field narrows some,” Haslam told TNReport in August.
Nine of the GOP presidential hopefuls at that time were or are current or past governors. Since then, Walker, Texas Gov. Rick Perry and Louisiana Gov. Bobbly Jindal have abandoned their 2016 Oval Office aspirations. Jindal’s departure was announced just this week.
Haslam complained during a RGA press conference this week that real estate magnate Donald Trump and retired neurosurgeon Ben Carson, neither of whom have ever held elected public office, seem to be stealing headlines and limelight from the Republican governors in the race.
“Benjamin Franklin famously said, ‘Well done is better than well said,'” said Haslam, according to a Politico story published Thursday. “Unfortunately, around the presidential election, we live in a media environment where well said is better than well done.”
Haslam will serve on the RGA’s 2016 executive committee, along with Rick Scott of Florida, Mike Pence of Indiana, Nikki Haley of South Carolina, Mary Fallin of Oklahoma, Doug Ducey of Arizona, Charlie Baker of Massachusetts, and Pete Ricketts of Nebraska.
Tennessee House Speaker Beth Harwell says there’s appreciable support among lawmakers for putting more money toward the state’s road budget next year.
“People are interested in our infrastructure — in how much money we are spending, maintaining it, even producing more roads, because they are a huge part of economic development. So I think legislators will be taking a look at that,” said Harwell, a Nashville Republican first elected to the Legislature in 1988.
But it’ll be “difficult” for the General Assembly in 2016 to muster the votes to elevate the per-gallon tax rate motorist pay for gasoline in Tennessee, the speaker told TNReport in Cookeville Thursday evening following a town hall meeting of her Task Force on Rural Economic Development.
Gov. Bill Haslam has been trying to build pressure on legislators the past few months raise the state’s current 21.4 cent per gallon gasoline tax, although he’s yet to say just how much more he thinks motorists ought to be paying at the pump. The diesel tax is 18.4 cents a gallon, and like the tax on gasoline, hasn’t changed since the late 1980s.
Harwell reiterated her view that before any tax increase gets a seriously look by GOP lawmakers, money that was removed from the transportation budget a decade ago ought to be rerouted back toward roads.
In the Senate, Transportation Committee Chairman Jim Tracy favors that as well. The Shelbyville Republican is sponsoring legislation to put $260 million from the general fund into the transportation spending outlay for the next fiscal year.
Typically, the taxes paid on gas and diesel purchases in Tennessee are designated to fund transportation projects. But under previous governors, Republican Don Sundquist and Democrat Phil Bredesen, funding was taken from fuel tax reserves and put toward the general fund.
Harwell noted that the state is currently taking in more sales-tax and other revenues than what the General Assembly and the governor’s administration budgeted for during the last legislative session, which ended in April.
“Our revenues are increasing in the state and we have some extra money there,” Harwell said. She suggested the state “restore that money that we took from the Department of Transportation during a rough time in a previous administration — restoring that so they at least have equal footing there in that funding.”
Gov. Haslam has said he’s willing to entertain the idea of rerouting general-fund dollars toward roadbuilding and maintenance. But he also says there’s vastly more transportation infrastructure need than surplus tax-collections can pay for.
Gov. Bill Haslam went on the road again this week trying to pave the way for lawmakers to take up the politically combustible topic of increasing taxes on gasoline and diesel.
The governor popped in Monday on brief events across Tennessee aimed at raising awareness about sinking transportation-allocated revenues. Among his destinations were Alcoa, Kingsport, Chattanooga and Memphis before heading back to Middle Tennessee in the evening.
“We are talking about something that affects every citizen,” the governor said during his first East Tennessee pitstop. “It is how we get our kids to school, how we get to work and back. It is how goods that our farmers grow and our manufacturers build, how they get those products to their markets all across the state. So, this really is an issue that affects everybody in the state.”
“We have been the beneficiaries of some responsible people who came before us, and I would like for us to show that same sort of responsibility.”
Automobile drivers who fill up with gasoline in Tennessee pay about 40 cents a gallon in tax — 21.4 to the state and 18.4 to Washington.
Diesel users pay about 43 cents per gallon in taxes in Tennessee — 18.4 cents in state tax and roughly 6.1 cents a quart to the federal government.
The state’s current fuel tax rates have been in place since 1989.
The governor, his transportation department staff and the state comptroller’s office contend that gas and diesel tax revenues at current rates are insufficient to take care of existing roadway infrastructure.
“Cars and trucks are more fuel-efficient, construction and labor costs have risen, and Congress has not passed a long-term transportation funding bill in 10 years,” a Haslam press release Monday said.
However, the administration has yet to float even a ballpark per-gallon tax-increase figure for lawmakers to pitch to their constituents.
“We’re not there yet,” said B.J. Doughty, communications director for the state Department of Transportation. “We are just taking about needs.”
TDOT officials say they’re “backlogged” to the tune of more than $6 billion on unfunded projects. At each of the governor’s events he and Transportation Commissioner John Schroer spotlighted local road-expansion proposals on the to-do list.
The projects Haslam and Schroer set out Monday to call attention to were:
Alcoa Highway in Blount County – $271.7 million
State Route 126 in Kingsport – $98.7 million
I-24/I-75 Interchange in Hamilton County – $65 million
Lamar Avenue in Memphis – $229.1 million
I-40 in Lebanon – $61.6 million
“We do feel like it is important for the legislators to see these lists of projects and keeping the conversation going,” Doughty told TNReport Monday evening. “It is really a matter of, ‘Do you want these projects, and if so, how soon do you want them?’”
Making the situation more critical are projections that “Tennessee’s population is expected to grow by 2 million by 2040, which puts a greater demand on the state’s infrastructure,” according to the Haslam administration.
Nevertheless, when the Tennessee Legislature convenes in January, Haslam will likely knock up against the same political embankment that’s been a barrier to him the last several months.
A lot of Republican lawmakers in both GOP-run chambers of the General Assembly are in no way primed to try convincing registered voters in their districts that taxpayers ought to be paying more at the pump — especially given that Tennessee is on track this year to again overcollect existing taxes state government is budgeted to spend.
“I am not comfortable going to my constituents and explaining why we are going to raise taxes on anything when we have a surplus in the general fund,” Mark Pody, a Republican state representative from Lebanon, said Monday. “I would not feel comfortable with that at all.”
Pody was one of a handful of regional government officials and business leaders from around Wilson County who turned up at a Lebanon outlet mall off I-40 to hear the governor deliver his last spiel of the day. Due to inclement weather in the area, though, Haslam’s plane from Memphis was delayed and the event was cancelled at the last minute.
All the same, Pody said he’s not been unmoved by the case Gov. Haslam and state transportation officials have been making. He agrees additional funding is needed to maintain and improve Tennessee thoroughfares.
“We have to find a way to get TDOT more money,” he said. “I am very, very comfortable doing that. But we need to decide what the best way to do that is.”
Like many of the lawmakers already on record opposed to a gas-tax increase, Pody supports topping off the road-budget next year with at least $260 million in general-fund dollars. That’s roughly the amount transportation advocates in the Legislature say was inappropriately tapped a decade ago from the state’s gas-tax revenue tank and used to fuel other government programs.
Jim Tracy, a Shelbyville Republican who chairs the Senate Transportation Committee, is leading the charge both to raise awareness about TDOT funding shortfalls and replace the “raided” $260 million.
Pody intends to push legislation next year that would permanently allocate sales-tax money collected from consumer purchases of auto and truck tires in Tennessee toward TDOT. He said the bill will be sponsored in the Senate by Mt. Juliet Republican Mae Beavers, another foe of hiking the gas tax.
He acknowledged that dedicating taxes on tire-sales to roadbuilding won’t pay for all TDOT’s list of projects.
“It is not going to be tens of millions of dollars — it is not enough to do everything that we need done,” Pody said. Still, ideas like that are much more palatable to penny-conscious politicians and voters at this stage, he said. “Rather than raising the gas tax, I would rather do something like that.”
Haslam hinted Tuesday that he may be getting the message that support is lacking in the Legislature for a gas tax hike in 2016. “I don’t know that we have to address it this year, but we have to address it while I’m governor,” he said. “I’ll just put it that way. Or the state will really be behind the eight ball.”
Below are statements from various political figures in response to the death of Fred Thompson, 73, an actor and former United States senator from Tennessee. He died Sunday from lymphoma.
Sen. Lamar Alexander: “Very few people can light up the room the way Fred Thompson did. He used his magic as a lawyer, actor, Watergate counsel, and United States senator to become one of our country’s most principled and effective public servants. He was my friend for nearly fifty years. I will miss him greatly. Honey and I and our entire family send our love and sympathy to Jeri and the Thompson family.”
U.S. Senate Majority Leader Mitch McConnel, R-Kentucky: “Fred Thompson lived life to the very fullest. The first in his family to go to college, Fred would go on to become Watergate lawyer, Senate colleague, presidential candidate, radio personality, and icon of silver and small screen alike, who didn’t just take on criminals as an actor but as a real-life prosecutor, too.”
U.S. Sen. Bob Corker: “Fred Thompson served the people of Tennessee and America with great honor and distinction. From the courtroom to Capitol Hill to Hollywood, his larger than life personality was infectious and had a way of making all of those around him strive to be better. Through his many different roles in public life, Fred never forgot where he came from, and our state and country miss his common sense approach to public service. I greatly appreciated his friendship and am saddened to learn of his passing. Elizabeth and I extend our thoughts and prayers to his wife, Jeri, the Thompson family and all those who were impacted by Fred’s life.”
Tennessee Republican Party Chairman Ryan Haynes: “The news of Senator Thompson’s passing gives me a heavy heart. This is a sad moment for all of us as our state has lost a larger-than-life figure. His quick wit, his hospitality, and his conservative beliefs reflected the best attributes of Tennessee. Senator Thompson was a statesman in every sense of the word. He will be missed as much for his friendship as he will for his leadership.”
Mary Mancini, Tennessee Democratic Chairwoman: “I would like to express my sincere condolences to the family of Senator Fred Thompson. Senator Thompson wore many hats but it was his life of public service that will leave an indelible mark in the Tennessee history books. He will be remembered fondly.”
Lt. Governor Ron Ramsey: “An iconic presence in both politics and film, Fred Thompson was a proud son of Lawrence County and a thoroughly effective public servant. Whether it was on the screen or in the Senate, Fred always made you proud to be a Tennessean. I was truly fortunate to count him as a friend. He will be missed.”
Craig Fitzhugh, Tennessee House Democratic leader: “Pam & I were sad to learn about the passing of Senator Fred Thompson. From his time as a young attorney on the Watergate Committee to his years in the United States Senate, Fred Thompson leaves behind an honorable legacy of public service. Our thoughts and prayers are with his entire family, especially his son Tony, during this difficult time.”
Former Vice President Al Gore: “At a moment of history’s choosing, Fred’s extraordinary integrity while working with Senator Howard Baker on the Watergate Committee helped our nation find its way. I was deeply inspired by his matter-of-fact, no-nonsense moral courage in that crucible.”
The Bush family: “Fred stood on principle and common sense, and had a deep love for and connection with the people across Tennessee whom he had the privilege to serve in the United States Senate. He enjoyed a hearty laugh, a strong handshake, a good cigar, and a healthy dose of humility. Fred was the same man on the floor of the Senate, the movie studio, or the town square of Lawrenceburg, his home.”
Bill Frist, former U.S Senate Majority leader: “Working at his side in the Senate for eight years, Fred embodied what has always been the best of Tennessee politics — he listened carefully and was happy to work across the aisle for causes that he believed were right.”
Tennessee House Speaker Beth Harwell: “Fred Thompson left an indelible mark on this state. Over his long and accomplished career, he never forgot where he came from–he was a Tennessean through and through. I am honored and proud to have known him, and to have called him a friend. He will be missed. My thoughts and prayers go out to the entire Thompson family during this difficult time.”
Gov. Bill Haslam on Monday ordered government-building flags flown at half staff. He said, “Tennessee has lost a great statesman and one of her favorite sons. (First Lady) Crissy and I have always appreciated his friendship, and we will miss him.”
The names of three potential nominees to the Tennessee Supreme Court were sent to Gov. Bill Haslam this week.
All three of the men, who were selected by the Governor’s Council for Judicial Appointments, serve as state appeals judges. They are Thomas Radcliffe Frierson of Morristown, Robert H. Montgomery, Jr. of Kingsport and Roger Amos Page of Medina.
Frierson currently sits on the Tennessee Court of Appeals Eastern Section. Montgomery is a judge for the eastern section of the state Criminal Court of Appeals. Page is on the Criminal Court of Appeals Western Section.
Page is 59 years old, Frierson is 57 and Montgomery is 62. All three were appointed to their current appellate bench assignments by Gov. Haslam.
“Nineteen years ago, I applied for a position on the Court of Criminal Appeals. While I was not appointed, I knew that if the opportunity ever presented itself, it was my career aspiration to serve on the Tennessee Supreme Court. While I did not have then the depth of legal knowledge and experiences that I have today, the same reasons still exist for my desire to serve on the Supreme Court – to serve the public by determining how justice is administered, not just in one courtroom, but throughout Tennessee.
“Over the years as a prosecutor, a trial judge, and appellate judge, I have worked continuously to develop my legal skills and knowledge. I believe that my professional and personal background, my abiding interest in legal concepts, my temperament and collegiality, my attention to details, my willingness to reflect on and make informed and logical judgments about people and the law, and my desire to share my legal knowledge, provide me with the skills to be a valuable Supreme Court member.”
“Serving the needs of others should be a lifelong endeavor. Judges, as public servants, play “a central role in preserving the principles of justice and the rule of law.” Tenn. Sup.Ct. R. 10, RJC Preamble. The opportunity to serve as a member of the Tennessee Judiciary is truly an honor.
“A broad spectrum of legal disputes currently require judicial review. Technological advances, enhanced access to information, and greater societal mobility mandate that a court respond to the call for justice in an effective, timely, and professional manner. Limited government resources must be responsibly extended so as to promote public confidence in the judiciary while preserving the integrity of impartial adjudication.
“I seek the privilege of serving as Justice of the Tennessee Supreme Court to address the significant demands of judicial service to others throughout our State. I welcome the responsibilities of fulfilling judicial duties while seeking to promote public confidence in the independence, integrity, and impartiality of the judiciary. No less significant is my focus upon encouraging civility and professionalism in the legal profession.”
“The short and easy answer is that I love the State of Tennessee. I can think of no higher honor than serving the people of our great State as a member of our highest court. Due to my unique educational experience of graduating from the University of Tennessee College of Pharmacy and the University of Memphis Law School, I have met and now know numerous people in almost all ninety-five counties of Tennessee. In my father’s direct ancestral line, I am a sixth generation West Tennessean. My mother’s ancestral family is from Sevier County in East Tennessee. My sons and grandchildren all reside in Middle Tennessee. If I am selected for this position, I will represent all Tennesseans on the Court.
“I believe that my entire professional life has prepared me for this position. I have vast experience in both civil and criminal matters. As an attorney and judge, I have handled cases involving medical malpractice, personal injury, workers’ compensation, stockbroker fraud, collections, divorces, probate and estates, condemnation, contracts, zoning and real estate.”
The latest Tennessee government tax collection tallies that came out last week suggest state government is, for the time being anyway, awash in unanticipated revenues.
While the budget year is still young, not yet three months old, early indications are that significantly more money is coming in than lawmakers and the governor were expecting when they plotted out the state’s spending plan last winter.
In September alone, the second month of the fiscal year, the state collected $113.4 million more than the budgeted estimate. That’s $82.2 million more than in September last year, according to a Department of Finance and Administration press release issued Oct. 14.
“Year-to date collections for two months were $132.5 million more than the budgeted estimate,” the administration reported. “The general fund was over collected by $116.8 million and the four other funds that share in state tax revenues were over collected by $15.7 million.”
The state also over-collected more than half a billion dollars last fiscal year.
For advocates of raising the state’s per-gallon taxes on gasoline and diesel — an idea Republican Gov. Bill Haslam has been test-driving around Tennessee — the fact that the government’s tank of revenue is overflowing will probably tend to make it tougher to convince skeptical lawmakers that it makes sense now to hit road-users with a tax hike.
High-ranking House Republicans like Speaker Beth Harwell, Majority Leader Gerald McCormick and GOP Caucus Chairman Glen Casada appear particularly unified in their opposition to raising fuel taxes in 2016.
Tennessee’s 21.4 cents per gallon tax on gasoline has been in place since 1989, as has the 18.4 cents per gallon diesel tax.
In a statement emailed to TNReport by her media spokeswoman on Friday, Harwell said she’s “encouraged by the revenue numbers, and believe(s) that we should use a portion of the surplus to replace the funds that were taken over the years from the highway fund.”
Leader McCormick echoed that sentiment earlier this month.
Talking about the quality of Tennessee roads and transportation funding in general “is a legitimate discussion to have,” McCormick told TNReport on Oct. 6.
But when the conversation turns to widening revenue-collection avenues, his instinct is to hit the brakes.
“I am not convinced we need to raise taxes to fund the road program right now,” McCormick said. “We do have to pay for it, and at some point we will have to address that, and we want to study it very closely and make sure we are doing the right thing. A tax increase is a last resort, not a first resort.”
Rep. Casada said Friday that House Republican leadership is aligned behind the idea that “we need to take the excess (general fund) revenue and put it toward the Department of Transportation to meet those immediate needs.”
He said majority-party lawmakers who oppose raising the gas tax are not unsympathetic to Haslam administration transportation officials who’re arguing that road improvement ought to be prioritized. But raising any tax is a tough sell when the citizenry has already over-contributed resources for what state government budgeted, he said.
“We have a surplus now and we had a surplus last year,” Casada said. “Let’s deal with that first and not take more money from the taxpayers.”
Casada doubts there’s enough support even on the House Transportation Committee to move legislation that aims to take more money from truckers and motorists at Tennessee fuel pumps.
“This is not the year to raise the gas tax,” he said.
Shelbyville Republican Jim Tracy, the Senate’s Transportation Committee chairman, has been, like Haslam did earlier this year, touring the state to talk about issues related to road infrastructure needs and financing.
Political and public willingness to entertain a tax increase is simply lacking, he said recently.
“We are not ready to do it yet,” said Tracy, who was in Knoxville and Fentress County for road-funding roundtables last week. “I don’t think the legislators are convinced of the need yet. I don’t think the citizens are convinced of the need.”
Tracy said he does however sense “a big movement” in support of setting aside a minimum of $260,000 million from the state’s general fund next year for transportation spending. That’s the amount he and others, like Harwell, say was inappropriately drained from gas-tax collections a decade ago and spent on other government programs.
Five of the Senate Transportation Committee’s nine members are in fact on record in opposition to raising the gas tax. In total, 15 of the General Assembly’s 33 senators have pledged not to vote for a fuel-tax hike should the Haslam administration propose one next year.
Over in the House, Casada, McCormick and Harwell are joined by 40 other representatives who have made assurances to the Tennessee chapter of Americans for Prosperity that they won’t support raising the gas tax in 2016 — and perhaps even beyond. All but one are Republicans: Kevin Dunlap, D-Rock Island, who won election to an open General Assembly seat in 2014 by just 54 votes over his GOP competitor.
A nationwide organization that lobbies for lower taxes and smaller government, AFP has been challenging the Haslam administration’s road-funds-are-lacking narrative through their “Ax the Tax” initiative.
Fanning up grassroots opposition against increasing the cost of gas hasn’t been too difficult, said Tori Venable, the group’s communications director.
“You have Gov. Haslam trying to raise taxes on the state, you have Sen. (Bob) Corker trying to raise taxes on the federal level,” she said. “This is potentially a double-whammy for Tennessee taxpayers.”
One of the main themes the governor and proponents of raising the gas tax are using to try and convince people that revenues are lagging is that cars these days get appreciably better gas mileage than three decades ago. The state therefore gets less money per vehicle-mile driven on Tennessee roads, they say.
But Venable said that’s not a one-way argument.
“When it comes down to it, the middle class and the working poor are the ones who drive older cars and they also drive further to work,” she said. “People who live in rural areas, people who have a fixed income, they are the ones who are going to be hurt worst by raising the gas tax.”
In an op-ed published Friday by the national political news website, The Hill, AFPTN director Andrew Ogles wrote that with gas prices at their lowest in years, there’s a predictable trend among state and federal lawmakers across the country to push for raising gas taxes.
“That’s certainly been the case in my home state of Tennessee,” wrote Ogles. “Gov. Bill Haslam (R) is currently gallivanting across the state calling for an increase to our gas tax. Joining him are various special interests — including building and construction companies — that stand to gain handsomely if his plan goes through.”
Ogles, who garnered significant state and national media attention for his role in leading AFPTN’s successful campaign against Haslam’s “Insure Tennessee” Medicaid expansion plan last legislative session, contends that road-and-bridge decay wasn’t a key priority when the governor and lawmakers approved the state budget a few months back.
“(I)n April state legislators diverted $120 million in surplus funds to construct a new state museum,” wrote Ogles. “If infrastructure funding is truly in peril, this state-level ‘Smithsonian’—as (Lt. Gov. Ron Ramsey) characterized it — could certainly be put on hold. Other examples abound, as well.”
Haslam has said that while he’s amenable to using at least part of any state revenue surplus for transportation funding, there’s always ample political competition for government funding — and oftentimes in fat years more so than lean.
“It is interesting when you have a surplus how many people have an idea for how to spend it,” Haslam said at a Transportation Coalition of Tennessee conference in Murfreesboro earlier this month.
The governor said he’s “very willing to consider” pumping the $260 million back into the transportation budget that was siphoned off under the two previous governors, Republican Don Sundquist and Democrat Phil Bredesen.
But as with all sales-tax-driven general fund revenue, “that money needs to compete with a lot of other things that are raising their hands for that money,” said Haslam.
“We have about $4 billion worth of deferred maintenance on our buildings in the state, so we are trying to take a chunk out of that — because, literally, chunks have been falling out of our buildings. That is one of those very non-glamerous, non-sexy things, but we have to do those,” the governor said.
Haslam administration officials maintain that more than $6 billion dollars in “very seriously vetted” road projects around Tennessee are currently in a state of unfunded “backlog.”
The governor and state transportation officials, as well as the state comptroller, argue the current gas and diesel tax rates are insufficient to meet longterm transportation construction and maintenance needs.