Tennessee Gov. Lee unveils $55.6 billion budget plan, seeks $3 billion injection into road spending

Tennessee Gov. Bill Lee delivers his inaugural address in the Legislative Plaza Saturday, Jan.21, 2023, in Nashville, Tenn. (AP Photo/John Amis)

NASHVILLE — Declaring Tennessee is at a “pivotal moment” in its 226-year history, Gov. Bill Lee on Monday challenged lawmakers during his fifth annual State of the State address to help him transform state highways and interstates, urging the General Assembly to plow an additional $3 billion into transportation in his proposed $55.6 billion 2023-2024 spending plan.

“We have an obligation to prepare our state for the future, and the time to do so is now,” the Republican governor told a joint session of the General Assembly.

Another major ask by Lee is a $1 billion proposal to complete a master plan for Tennessee Colleges of Applied Technology, which Lee said already enable Tennesseans to “kickstart a great career close to home.” Nearly nine out of 10 graduates can get a job in the field they studied, Lee said.

He wants to replace seven outdated facilities and build six new such colleges at strategic locations across the state. The goal is training 10,000 new skilled workers a year. The money he is requesting would represent the largest investment in technical colleges in state history, the governor said.

Other proposals from the Republican governor, sworn into a second four-year term last month, call for the creation of a three-month-long sales tax holiday on food sold in grocery stores — a three-fold increase — as well as reductions in some business taxes. And after having won approval last year for an additional 100 Tennessee Highway Patrol troopers, Lee is asking lawmakers to approve 100 more this year.

The governor emphasized road funding, which may be his toughest challenge legislatively speaking this year.

“It’s time to invest in a transportation strategy for one of the fastest-growing states in the country,” he said. “We cannot solve this problem with debt or higher taxes, but we have to do something. Right now, there’s a $26 billion dollar backlog of projects across the state.”

Lee announced the night of his Nov. 8 re-election victory that he wants authority to initiate public/private partnerships with investors to build toll roads he’s dubbed “choice” lanes in congested areas — because motorists can choose to pay a toll.

“We are way behind, and we have to change the way we fund and build our roads and bridges,” he said.

Lee is recommending legislators raise transportation spending from the current $3.294 billion to $6 billion, with most of the increase coming from federal funds, according to the budget document.

“We know that we have to tackle big, urban projects, but if we don’t change the strategy, we all know who would end up paying the price – our rural communities,” he said.

Lee said that’s why he’s introducing his Transportation Modernization Act, which he described as a plan to engage public-private partnerships to build additional choice lanes on urban highways, to ensure electric vehicle owners pay their share in maintaining roads, and to provide a delivery model that builds rural and urban projects faster, all without the burden falling on Tennessee taxpayers.

“And hear me when I say this: toll roads are not on the table,” Lee said, arguing that’s because motorists will have a choice on whether or not they want to use the lanes. A number of states, including Georgia, have implemented similar programs.

“There is a great cost to doing nothing,” Lee said. “We can easily kick the can down the road for four more years, but Tennesseans will pay the price for it with more potholes, longer commutes and less economic activity.”

The governor noted he got an overhaul of the state’s public school funding formula last year. He said he is proposing putting an additional $350 million into the Tennessee Investment in Student Achievement formula, in which state and local tax dollars follow students. And he wants a $125 million raise for teachers.

The governor some years back also got through the Education Savings Account program, which finally launched this school year after several court battles. It allows low-income students in certain areas to apply state funds to private school tuition.

“I have always believed that we should strive to have the best public school system in the country and provide choices for parents,” Lee said.

While Republicans applauded any number of Lee’s efforts, Democrats were less impressed.

“Our state is flush with financial revenues and reserves, yet sorely lacking in political courage and leadership,” charged House Democratic Caucus Chairman John Ray Clemmons in a text to the Chattanooga Times Free Press. “This is yet another budget that will fail our public school students and leave working families sitting in traffic.

“Local economies will continue to suffer from a lack of forward-thinking infrastructure investment, and our neighbors will continue to suffer from a lack of access to vital healthcare services,” Clemmons continued. “It is personally difficult to stomach such fiscal irresponsibility and the complete lack of desire to substantively address the biggest challenges facing Tennessee families. I dare say that at no time in Tennessee history has one governor done so little with so much.”

Contact Andy Sher at asher@timesfreepress.com.