Senator Mark Norris
9A Legislative Plaza,
Nashville, Tennessee 37243-0232
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©2017 Mark Norris
April 15, 2016
Legislature passes key bills as lawmakers look to close 2016 session next week
Budget calls for phase out of Hall Income Tax and increased property tax relief for 100 percent service-related disabled veterans and elderly disabled
The Tennessee Senate passed the state budget as the 2016 session of the Tennessee General Assembly draws to a close. The $34.9 billion debt-free budget proposes state government spending for the next fiscal year that begins July 1, 2016 and extends to June 30, 2017.
“Senate Bill 2653 is the Balanced Budget Act of 2016,” said Senate Majority Leader Mark Norris (R-Collierville), sponsor of the legislation. “It focuses on the ‘four Es’ of Tennessee – employment, education, economic opportunity and enforcement of the law. The balanced budget is ‘job one’ because it not only demonstrates our stewardship of the taxpayers’ property, but it reflects upon our ability to assure the best return on their investment of precious resources and undergirds our constitutional responsibility to provide for the peace, safety and happiness of the people of Tennessee.”
Among two key provisions in the budget is one which calls for the phase out of Tennessee’s Hall Income Tax on interest and dividend income from investments. Since enactment of the Hall tax in 1929, the use of investment savings has grown as a primary source of retirement income. The current tax rate is six percent applied to all taxable interest and dividend income over $1250 per person and $2500 for married couples filing jointly. The legislation calls for cutting the tax by one percent this year, with the legislative intent to eliminate it by 2021.
In addition, the budget provides for increased property tax relief for 100 percent service-related disabled veterans by repealing the income cap that was put in place last year and raises the property value limit for the elderly disabled. Norris said there are currently 21 counties which are making up any differentials that are helping to even the tax relief that can be given.
On K-12 education, the budget makes the largest investment without a tax increase in Tennessee’s history by providing an additional $261 million for Tennessee’s public schools. Significant K-12 increases include $104.6 million for teacher salaries, $29.5 million to fund 12 months (up from 11) of health insurance for teachers, $13.9 million for additional English Language Learning teachers (ELL) and translators, and $3.6 million for training teachers and principals.
In higher education, the budget totals $1.7 billion, including $50 million recurring for the outcomes formula productivity increases at the University of Tennessee (UT) and Tennessee Board of Regents (TBR) institutions. Similarly, it provides additional funds of almost $9.2 million for operating increases at UT and TBR non-formula institutions. In addition, the appropriations bill provides a one-time influx of $297.8 million for capital improvements and maintenance at the state’s higher education institutions.
The budget also provides $10 million in non-recurring funds for the Labor Education and Alignment Program (LEAP) program which was very successfully funded with an initial $10 million several years ago. The LEAP program, sponsored by Leader Norris, enables students in Tennessee Colleges of Applied Technology and community colleges to participate in technical training developed with input from area employers. The cooperative training counts as part of an approved curriculum toward a meaningful certificate or degree.
The Senate’s amendment to the budget bolsters job creation by adding $4.25 million to the governor’s proposed $20 million for the Drive to 55 capacity fund. The Drive to 55 initiative aims to get 55 percent of Tennesseans equipped with a college degree or certificate by the year 2025.
Other key budget improvements include:
“It matters who governs and it matters how we govern,” Leader Norris added. “I often say, ‘the best is yet to come so long as we make the best of what comes our way.’ I believe that working together for Tennessee we will.”
Victim’s Rights / Parole Hearings — A bill to permit the Board of Probation and Parole to defer a new parole hearing for up to ten years after the Board denies an inmate’s parole if the inmate is using the parole hearings process to intimidate and harass the victim was approved by the Senate on Wednesday. Senate Bill 407 stems from the brutal kidnapping of Laura Dean and Gerald Street in Hawkins County, Tennessee. The victims were taken through multiple counties and Dean was raped before the two were thrown off a bridge. The perpetrators were sentenced to 130 years in prison. Since that time, they have become eligible for parole and had at least seven parole hearings in a ten-year period, two being only nine months apart. Currently, the Board cannot defer further hearings beyond seven years. This legislation allows the Board the discretion to wait ten years before considering whether an inmate is eligible for parole. The bill will now go to the floor of the Senate for final consideration. It is sponsored by Senator Doug Overbey (R-Maryville).
F & E Taxes — Senator Randy McNally (R-Oak Ridge) guided the passage of legislation concerning franchise and excise (F&E) taxes through the Senate Finance, Ways and Means Committee this week. Senate Bill 2558 improves the process for estimating F&E taxes by allowing a current year method, which gives businesses an alternative 80% calculation method. This scheme will be used by some taxpayers, like retailers, that enter fourth quarters that often make or break their year, giving them greater flexibility and time to reconcile their estimates. The legislation also significantly lowers the penalty for underpayment of F&E taxes from five to two percent. “The bill efforts “The bill efforts to take some of the volatility out of the excise tax by lowering some of the penalties and discourages people from overpaying which leads to credits and refunds,” said Sen. McNally. Last year, the Department of Revenue received $160,000,000 in overpayment from franchise and excise taxes.
Officer Involved Shootings / Reports — Senator Brian Kelsey (R-Germantown) guided passage of legislation regarding officer involved shootings through the Senate Finance, Ways and Means Committee this week. Senate Bill 2023 will allow for an investigatory report prepared by the Tennessee Bureau of Investigation (TBI) in response to an officer involved shooting to be released by the district attorney general. Currently, a district attorney must petition the court to release the report. This bill aims to provide more transparency to the public regarding the reports.
Business / Licensing and Regulations — Legislation to reassess some of the barriers of entry to the workforce was approved by the State Senate on Monday. Senate Bill 2469, sponsored by Senator Mark Green (R-Clarksville), would compel various licensing authorities to review their entry regulations in various occupations and report such to the Senate Government Operations Committee. Once reviewed, the committee can make recommendations to remove some of the unnecessary restrictions and demands. The “Right to Earn a Living Act” will help relieve the burden of excessive regulation on the right of an individual to pursue a chosen business or profession.
Elderly / Healthcare Structures — The State Senate passed legislation this week that will help relieve some of the burdens placed upon Tennessee’s elderly. Sponsored by Mike Bell (R-Riceville), Senate Bill 2375 will authorize zoning consideration of temporary family healthcare structures for mentally or physically impaired citizens on the property of their caregiver. Similar to a “mother-in-law apartment,” the temporary housing must have access to water, sewer and electric utilities. The elderly is the fasting growing age demographic in Tennessee and by 2020, 1 in 5 citizens will be over the age of 65 and 70 percent will require some form of assistance. This legislation allows for those vulnerable adults to receive the assistance they need from their families while still maintaining some independence. The companion bill awaits consideration by the full House of Representatives.
Court of Criminal Appeals – The Senate Judiciary Committee voted this week in favor of recommending the confirmation of Shelby County Attorney J. Ross Dyer to the Court of Criminal Appeals, Western Section. Dyer was nominated by Governor Bill Haslam to replace Roger Page, who recently became a Tennessee Supreme Court Justice. Dyer, 43, has been the chief counsel for Shelby County since 2014, serving as the top legal advisor to the county mayor, county commission and other county officials. Prior to that, he was senior counsel and managing attorney for the Memphis office of the Tennessee Attorney General from 2004-2014. He was also team leader and assistant attorney general in the criminal justice division of the Nashville office of the Tennessee Attorney General from 1998-2004. In those positions, he handled more than 20 cases in the Tennessee Supreme Court and more than 1,000 cases in the Tennessee Court of Criminal Appeals. The House of Representatives and Senate will meet in a joint session on Monday to act on the nomination.
Affordable Healthcare — The State Senate approved a minor amendment and sent to the governor legislation to provide Tennesseans with an affordable free-market option to contract directly with their physician for primary healthcare services. The “Health Care Empowerment Act” removes roadblocks in state law to the growing Direct Primary Care (DPC) healthcare model by ensuring that it is not considered an HMO or insurance company for purposes of regulation in Tennessee.
Under the DPC model, patients pay their doctors a monthly fee in return for agreed-upon primary care services. In order to be Obamacare-compliant, a patient may supplement a DPC membership with a high-deductible “catastrophic” insurance policy. The combined cost of monthly membership fees and insurance premiums is anticipated to be substantially lower than a traditional health insurance plan with co-pays, deductibles, and premiums.
Senate Bill 2443 aims to give healthcare consumers who are struggling to pay the increasing costs of premiums or who have been priced out of the market, with an affordable option to contract directly with their physician for primary care services. It also gives physicians the opportunity to set aside insurance hassles and just practice medicine.
Studies show that in states where direct primary care is utilized, health outcomes have improved with doctors spending more time with patients on preventative care and monitoring chronic conditions. Presently, 14 states have passed enabling DPC legislation. The bill is sponsored by Senator Kerry Roberts (R-Springfield).
Fetal Remains Act — Legislation which addresses concerns raised last year regarding the selling of human fetal passed the Senate this week. The “Fetal Remains Act,” seeks to stop the possibility of abortion clinics selling fetal remains by properly equipping the Tennessee Department of Health to be able to identify this practice.
The bill comes after the Senate’s Government Operations Committee held a hearing last summer to look at enforcement of Tennessee’s law banning the sale of tissue or organs from an aborted fetus. Following the meeting, Governor Haslam charged the Tennessee Department of Health (TDH) with conducting a comprehensive review of abortion regulations and inspection requirements related to the disposition of an aborted fetus to identify ways to strengthen the regulatory framework surrounding facilities that perform abortions. A number of administrative changes were implemented immediately to help address the issue, but legislation was also needed to strengthen accountability and transparency for surgery centers performing abortions.
Senate Bill 2568 requires increased reporting of the disposition of fetal remains, prohibits reimbursement of any costs associated with shipping an aborted fetus or fetal remains and establishes a mandatory interim assessment process for an ambulatory surgical treatment center performing more than 50 abortions annually. At present, any abortion performed in Tennessee must be reported to the Tennessee Department of Health (TDH) within 10 days of the procedure. This bill adds the requirement that, for a surgical abortion, physicians must also report the method of disposition of the fetal remains and, in the event the remains were transferred to a third party, the name and address of the third party and date of transfer. For facilities performing 50 or more surgical abortions per year, these facilities must maintain a record of such reports and produce the reports to TDH during inspections under the legislation.
In addition to the current ban on the sale or purchase of fetal tissue, this bill adds language to make clear that reimbursement for any costs associated with the preparation, preservation, transfer, shipping or handling of an aborted fetus or fetal tissue is also a Class E felony. The legislation requires the mother’s authorization for disposition of the fetus that results from a surgical abortion to be included as part of the informed consent process prior to the procedure, as well.
Finally, the bill requires that any facility performing more than 50 surgical abortions per year must perform interim assessments of their compliance with the Board of Licensing Health Care Facilities on specified measures and report on sentinel events. Facilities with deficiencies will develop an acceptable plan of correction. These assessments will provide for a more robust on-site inspection by TDH and help foster a continuous culture of compliance. The bill is sponsored by Senate Majority Leader Mark Norris (R-Collierville) and Senator Kerry Roberts (R-Springfield).