Tennessee governor candidates find common ground on online sales taxes [photos, video]

Flanked by fellow gubernatorial candidates Randy Boyd, left, Karl Dean, second from left, Craig Fitzhugh, fourth from left, and Beth Harwell, right, Bill Lee, center, answers a question during a forum hosted by the Chattanooga Times Free Press in the Tennessee Room at the University Center on the campus of the University of Tennessee at Chattanooga on Monday, June 25, 2018 in Chattanooga, Tenn.

Tennessee candidates for governor Monday night welcomed last week's U.S. Supreme Court ruling allowing states to require out-of-state online retailers to collect sales taxes, with Republicans and Democrats offering varied and sometimes conflicting ideas about how the expected windfall should be used.

The Republican candidates said the money, which may approach $450 million annually, could be used to either cut the state's general sales tax rate of 7 percent or to reduce corporate taxes on businesses to encourage growth, as well as for some state programs.

Democrats said the money could be used to boost education, including teacher pay, as well as health care and other areas of state responsibility.

Their comments came in a 90-minute forum sponsored by the Times Free Press and held before a packed room at the University of Tennessee at Chattanooga. Early voting in the Aug. 2 primary starts July 13. The candidates are seeking to replace the term-limited Republican Gov. Bill Haslam.

In other areas, Democrats and Republicans were at odds on issues ranging from in-state tuition for undocumented students to the appropriateness of the Republican-controlled General Assembly's propensity to wade in and override city governance in areas ranging from "sanctuary cities" to short-term rentals.

Republicans Knoxville businessman and former state economic commissioner Randy Boyd; state House Speaker Beth Harwell of Nashville and Franklin businessman Bill Lee participated in the forum, as did Democrats Karl Dean, a former Nashville mayor, and state House Minority Leader Craig Fitzhugh of Ripley.

Republican U.S. Rep. Diane Black of Gallatin was the lone major candidate not to attend Monday's forum.

Last week's narrow 5-4 ruling on the online sales issue drew praise from all five candidates who attended.

"I certainly would look to move forward with taxing internet sales," Dean said. "No. 1, I believe we need the revenue, and No. 2, it's a matter of fairness." He said he would work with state lawmakers if elected and would hope to put the money toward education.

Lee said he believes it's "important to look at protecting the businesses in this state to make sure the tax structure is fair." Currently, out-of-state retailers with no physical presence in Tennessee such as an office or store have an unfair advantage over traditional brick-and-mortar businesses, he said. Lee noted that Tennessee business taxes are high.

Other candidates agreed from various perspectives.

"Remember, these are not new taxes but folks are supposed to pay [these] but haven't because there was not any means," Fitzhugh said. The money is "something we can use to pay our teachers better," Fitzhugh added, also noting some could be used to help guard state coffers against a future recession.

Harwell said that "something I've wanted to do for a long time is lower our sales tax" in a state where state and local sales taxes are among the nation's highest, later adding, "I would do it in a sense that it would be revenue neutral to [consumers]."

Boyd said that while the issue is ultimately up the General Assembly for disposition, he agreed with Lee's characterization that Tennessee's 6.5 percent business franchise and excise tax rate is among the nation's highest business taxes and impairs the ability to draw new companies here. He also said he would look at cutting sales taxes on healthy foods to spur consumption and use proceeds to boost education and "tackle" the state's opioid crisis.

The candidates also stressed support for boosting public school safety in the wake of mass school shootings across the nation.

"We want to make sure every school has a school resource officer," Harwell said.

Boyd said he wants to "ensure all schools" have resource officers as well as school nurses and access to mental health professionals. The "root cause" of the massacres, often carried out by students, is mental health, Boyd said, adding, "we've got to start putting our emphasis on mental health."

Lee said, "we need to do whatever we can do to protect our citizens. We protect our banks with firearms and yet we leave our kids in gun-free zones and we should change that." He said no option should be "left on the table," including the use of retired police officers and using a teacher who's been "vetted and properly trained" to be armed in a classroom.

A measure seeking to arm willing teachers did not make it out of the state House this year.

Fitzhugh said he's marched with students who are "just pleading with us to do something about our schools." He called adding school resource officers "the best thing we can do, and I certainly am not in favor of arming teachers."

Calling safe schools "a top priority," Dean said, "I also think there has to be a conversation around guns. I would acknowledge this is a difficult conversation in Tennessee."

Republican and Democratic candidates also were at odds over expanding the state's Medicaid program, TennCare, to an estimated 280,000 low-income Tennesseans. Haslam tried in 2015 but was rebuffed by fellow Republicans in the legislature.

There were several protesters outside Monday's debate at UTC's student center.

Judith Pederson-Benn with Chattanooga Supports Parkland Students said she was protesting so candidates would know many people want what she believes are sensible gun laws and would work to support them.

Not everyone backs the National Rifle Association, she said, and such laws may not solve everything, "but it's an important step forward."

As for Black's absence, the congresswoman has consistently avoided forums that include Democrats but has participated in several Republican-only debates. She said Sunday at a Williamson County fundraiser held for her that she doesn't do events with Democrats because her focus now is on the GOP primary.

"I'm a Republican and I got to get through a Republican primary," Black said. "There'll be plenty of time for me to debate whoever the Democrat is that comes out of there. So let's take it one step at a time and let me debate the people I'm running against. I'm not running against a Democrat right now, I'm running against fellow Republicans."

Staff writer Rosana Hughes contributed to this story.

Contact staff writer Andy Sher at asher@timesfreepress.com or 615-255-0550. Follow on Twitter @AndySher1.