published Tuesday, February 10th, 2009

Goetz: Tennessee could receive $4.3B in stimulus money

  • photo
    Senate Majority Leader Harry Reid of Nev., left, and Senate Budget Committee Chairman Sen. Kent Conrad, D-N.D. walk off the Senate floor on Capitol Hill in Washington, Tuesday, Feb. 10, 2009, after the Senate approved President Barack Obama's stimulus measure. (AP Photo/J. Scott Applewhite)


Associated Press Writer

NASHVILLE — Tennessee Finance Commissioner Dave Goetz said Tuesday that the state could receive as much as $4.3 billion under the House version of the economic stimulus bill before Congress.

Goetz provided lawmakers with figures from both the House and Senate versions, the latter of which would give the state about $3.1 billion.

However, Goetz said the state also has a plan in place in case it doesn't receive any stimulus money. It would have to make about $900 million in cuts for the budget year that begins July 1.

Administration officials have said stimulus money could ease those cuts. Still, they warn there are certain restrictions on how the money would be used, and it has to last over two years.

"It's non-recurring money and we have to be responsible," Goetz said.

Gov. Phil Bredesen told reporters in a teleconference Tuesday that the House version of the stimulus bill is "far more generous to the state."

The Senate voted 61-37 Tuesday to pass an $838 version of the stimulus bill, compared with $819 billion in the House-passed version. Now President Barack Obama's recovery plan is headed to difficult House-Senate negotiations amid Obama's calls for a completed version by the weekend.

Bredeson said the Senate version makes deep cuts to local governments. But the governor said he can't be too picky in a rapidly deteriorating economy.

"Any money they can send to help us through this is very welcome," he said.

Tennessee, like many other states, is trying to position itself to best utilize its expected stimulus money.

Tennessee's tax collections have fallen nearly a half-billion dollars short of expectations through the first six months of the current budget year. Sales taxes, which account for two out of every three tax dollars collected in Tennessee, have missed projections by $281 million since July.

Goetz said the state is on pace to record a shortfall this year topping $1 billion, which could mean laying off hundreds of state employees. About 1,500 state workers accepted voluntary buyouts in August.

"The economy is not showing signs of recovery," he said. "Everything we can do to reserve cash and pull cash from other sources, we are proposing."

One proposal administrative officials are hoping lawmakers will approve is the use of bonds to pay for infrastructure obligations the state has made to two companies coming to Chattanooga, Tenn. Both projects could actually give the state's economy a boost.

Volkswagen's planned $1 billion assembly plant is expected to require about 2,000 employees, with another 9,500 related jobs eventually expected to be created.

Hemlock Semiconductor Corp. plans to build a $1.2 billion plant that will produce polysilicon, a raw material used to make solar cells and semiconductor devices. The site is expected to require about 1,000 construction workers for up to seven years, and create between 500 and 800 new jobs at the plant.

Unlike many states, Goetz said Tennessee has never sold bonds for economic development purposes. But, with the current state of the economy, he said it's now "the best course to take."

"It allows us to meet our obligation to both Volkswagen and Hemlock, but to pay for it over time," he said. "Previously we've used cash, but we're cash poor right now."

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rolando said...

Maybe Tennessee will get $5Billion, maybe not.

In any case, the $5B will cost us -- the taxpayers -- about $50Billion after Congress gets its piece of the action.

Anyone notice the smart money -- the uber-wealthy -- are buying gold bullion at a record breaking pace? Twice as much sold last month than during Jan 2005. Gold will soon hit $1,000 per OUNCE! A US $50 gold piece [1 troy ounce of gold] sells for about $850 and rising. That says volumes about what the wealthy think of the stimulus...

February 10, 2009 at 4:23 p.m.
thatguy said...

Here's an idea for you republicans, refuse any profits or benefits you may gain from the stimulus bill. That will show us how committed you are to your cause. No instead you will be the first with your hands out.

February 10, 2009 at 8:03 p.m.
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