State budget gets lawmakers' OK: Teacher, employee raises dropped because of shortfall

Arkansas-Tennessee Live Blog
photo The Tennessee State Capitol in Nashville.

NASHVILLE - State lawmakers on Thursday gave final approval to a $32.4 billion spending plan for 2014-2015 after majority Republicans fended off Democrats' attempts to partially restore pay raises for teachers and state employees.

Republican Gov. Bill Haslam largely got what he wanted in the amended bill, though he couldn't keep his election-year pledge of 2 percent raises for teachers and 1 percent raises for other state workers because of a $267 million revenue shortfall. The vote was 68-27 in the House and 28-3 in the Senate.

Democrats and a group of House Republicans planned to challenge the reversal. But Rep. Matthew Hill, R-Jonesborough, dropped a move to restore some of the pay and provide a one-time bonus after hearing from colleagues at a Republican Caucus meeting and speaking with administration officials.

Democrats pushed ahead with their own plan.

Minority Leader Craig Fitzhugh, D-Ripley, charged the governor and fellow Republicans are "going to balance [the budget] on the workers of this state."

He offered an amendment to partially restore Haslam's original proposal. He would pay for part of it with money Haslam wants to use to bolster the state's Rainy Day Fund. Some of the raise would go into effect if revenues increased.

Majority Leader Gerald McCormick, R-Chattanooga, called Fitzhugh's plan a "gimmick" and said it would confuse state workers, teachers and higher education employees.

Fitzhugh complained that lawmakers, who hope to adjourn Tuesday, weren't willing to wait around until March tax collection figures are released. Collections could show improvement, Fitzhugh said, adding the state won't even know whether business franchise and excise taxes have improved until later this month.

Haslam said in February he wants Tennessee teachers to have the fastest-growing salaries in the nation over the next five years. He has no Republican primary opposition and faces whoever emerges from a group of little-known Democratic candidates in the November general election.

Speaking with reporters last week, Haslam said it's "really important" that teachers and workers "understand that this is the last thing we want to do. We're dealing with a very difficult budget reality."

During the House floor debate Thursday, Finance Committee Chairman Charles Sargent, R-Franklin, echoed the governor's remarks.

"It's been a tough year," Sargent said. But he added, "I think we've come up with a good conservative budget, working within our means."

The Associated Press reported that Senate Speaker Ron Ramsey, R-Blountville, said after the Senate vote that lawmakers will refocus on teacher and employee pay next year.

"There's no doubt in my mind that the No. 1 priority when we come back next year will be teachers and state employees' pay raises," Ramsey said.

During Senate debate on the budget, Minority Leader Jim Kyle, D-Memphis, sought to add $2 million for the Tennessee Bureau of Investigation to start tackling a large backlog of untested rape kits.

"Go back and tell the victims there's no money, they'll just have to wait," Kyle chided GOP senators. He later challenged Republicans, reminding them the Legislature has a $41 million reserve fund that could easily provide the funding.

His amendment was tabled.

The state's new spending plan takes effect July 1. It represents a 2.4 percent reduction from the current $33.2 billion budget.

Sargent told House members it contains $47 million in new funding for the state's $4.2 billion school funding formula.

It also provides $77 million in new funding for TennCare, the state's version of Medicaid. That's because while Haslam and Republicans so far have refused to expand Medicaid to new groups of low-income people as allowed under the Affordable Care Act, more eligible people are expected to sign up for the first time.

In other legislative action Thursday:

• Senators approved Haslam's amended school voucher plan, 20-10, but differences remain with a House version still in the House Finance Committee.

Haslam originally sought to limit the vouchers to students from low-income families who attend the bottom 5 percent of failing public schools.

But the Senate bill provides that if there aren't enough students to fill the initial 5,000 slots, eligibility is open to other low-income students.

The bill would affect schools in Hamilton, Davidson, Knox and Shelby counties, which have schools on the state's high-priority list.

Contact staff writer Andy Sher at or 615-255-0550.