Tennessee Has Nation's 4th Lowest Tax Rate - Nothing to Brag About

Extra Extra! Read all about it!
This calls into question many claims that implementing an income tax in Tennessee or asking corporations to pay their fair share would harm recruitment to the state. We need MORE REVENUE with justice, and Tennessee's tax "burden" has actually shrunk in recent years. This ranking is nothing to brag about - we have the 4th lowest overall tax rate, and that leads directly to Tennessee's poor rankings in the following areas: (thanks to TFT intern Katie Findley for her research on this!)

Children and Education
• 37th in percent of public school eighth graders proficient or better in reading in 2007
• 39th in estimated average salary of public school classroom teachers in 2009. (National average = $55,350/ Tennessee $46, 290) = interesting statistic given the attack on teachers' collective bargaining rights this legislative session
• 9th highest children living in poverty in 2008
• 39th in child poverty
• 41st in percent of public school fourth graders proficient or better in reading in 2007
• 41st in percent of population graduated from high school in 2008
• 41st in percent of public school eighth graders proficient or better in mathematics in 2009
• 44th in books in public libraries per capita in 2007
• 44th in percent of public school fourth graders proficient or better in mathematics in 2009
• 23rd in per capita state and local government expenditures for education in 2007
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
^United Health Foundation: America's Health Rankings 2010. No. 1 is best; No. 50 is worst.

Economy
• 2nd in personal bankruptcy rate in 2009. (National rate = 434 per 100,000/ Tennessee = 843 per 100,000)
• 36th in Per Capita personal income in 2009. (National per capita = $40,208 / Tennessee = $34,976)
• 45th median household income in 2008. (National Median = $51,297/ Tennessee = $41,978)
• 29th Average Annual Pay in 2008. (National Average = $45, 563/ Tennessee Average = $ 39, 996)
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.

Elderly
• *4th highest rate of elderly individuals living in poverty rate for in 2008
• ^ 52.5% of grandparents responsible for their grandchildren
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
^ "American Fact Finder". U.S. Census Bureau. 3/30/10 .

Hurting Residents and the Economy

According to a November 2010 report from the Center on Budget and Policy Priorities (CBPP), Tennessee is among 29 states that are expected to cut services to individuals who are elderly or disabled. These cuts are arguably due to a tax structure that does not produce the adequate revenue to support services for the most vulnerable. This reduction in services not only impacts the recipients, the elderly and disabled in communities across Tennessee, but it also negatively affects the state economy. The CBPP states that cuts to services will reduce overall economic activity and therefore dampen the recovery of the economy.

Systemic change to the tax structure is needed, as the state cannot rely mainly on the revenue from sales tax. Tennesseans for Fair Taxation supports, through legislative change and advocacy, a diverse and fair structure for state revenue collection that both bolster residents and economic growth.

http://www.cbpp.org/cms/index.cfm?fa=view&id=1214

Environment and Conservation
• 9th most released toxic air emissions in 2007
• 10th most toxins released (includes air, water, underground, and surface land) in 2007
• 8th most coal mines in 2008
• ^39th: Air Pollution
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
^United Health Foundation: America's Health Rankings 2010. No. 1 is best; No. 50 is worst.

Health Care
• *14.4% = Percentage of population not covered by health insurance in 2008
• *10.4% = Percentage of population lacking access to primary care in 2010
• *6th highest births of low birth weight in 2007
• *4th highest infant mortality rate in 2006
• *13th highest death rate by diseases of the heart in 2006
• *13th highest in estimated deaths by cancer in 2009
• *9th highest teenage birthrate in 2007
• *2nd highest in percent of adults overweight or obese in 2008
• ^48th: Poor Physical Health Days
• ^46th: Infant Mortality
• ^46th: Cancer Deaths
• ^45th: Preventable Hospitalizations
• ^44th: Cardiovascular Deaths
• ^41st: Smoking Prevalence
• ^39th: Infectious Diseases
• ^47th: Prenatal Care
• ^41st: Poor Mental Health Days
• ^31st: Lack of Health insurance
• ^21st: Public Health Funding
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
^United Health Foundation: America's Health Rankings 2010. No. 1 is best; No. 50 is worst.

Higher Education
• 37th in percentage of population who have completed an advance degree in 2008
• 41st in percentage of population that has a bachelor's degree or more in 2008. (National percentage = 22.9 / Tennessee = 27.7%)
• 49th per capita state and local government expenditures for higher education in 2007
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.

Hunger and Poverty
• *5th highest percent of population receiving public aid in 2007
• *4th highest elderly in poverty rate in 2008
• *9th highest children living in poverty in 2008
• *10th highest poverty rate in 2008
• *10th highest families living in poverty in 2008
• ^16th Geographic Disparity
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
^United Health Foundation: America's Health Rankings 2010. No. 1 is best; No. 50 is worst.

As organizations that provide food for the hungry are reporting supply shortages, the need for food continues to increase. Communities across the state are riddled with unemployment and hunger is on the rise. Organizations that often rely on donations are struggling to provide services to an increasingly growing population of those in need.
With creativity and cooperation, policy changes can be the solution to reducing the hunger problem in Tennessee. A fair taxation system in Tennessee that collects revenue from many diverse sources, and does not rely primarily on sales tax, is crucial. Increased revenue into the state can translate into additional services for those in need, fully fund and support existing programs, and subsequently reduce hunger and poverty.
http://www.wmctv.com/Global/story.asp?S=13521873
http://www.npr.org/templates/story/story.php?storyId=89817185&ft=1&f=1001

Labor and Worker Rights
• *29th Average Annual Pay in 2008. (National Average = $45, 563/ Tennessee Average = $ 39, 996)
• *45th in average hourly earnings of production workers on manufacturing payrolls in 2009. (National Average= $ 18.49/ Tennessee = $15.12)
• *34th in job growth from 2008 to 2009. (National percent change = 3.1% decrease / Tennessee = 3.9% decrease)
• ^30th: Occupational Fatalities
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
^United Health Foundation: America's Health Rankings 2010. No. 1 is best; No. 50 is worst.

Tennessee’s Time

With the state unemployment rate at 9.4 percent, it is time for legislative changes to make Tennessee a leader nationally in job growth and economic stability. Governor Bill Haslam, the self-titled “chief salesman” of the state, has vowed to bring sustainable jobs to Tennessee.

“Bill understands that we must get people back to work quickly while also having a plan for long-term economic growth. Bill will lead an administration whose overarching goal will be to make Tennessee the No. 1 state in the Southeast for high quality jobs.”
-Bill’s Priorities, www.billhaslam.org

Given Tennessee was ranked 34th worst in job growth from 2008 to 2009; state government officials must act now to support existing businesses and encourage new business growth. Creating an environment where business can flourish and the unemployed can re-enter the workforce must be a priority of the new administration. Effective policies that reduce the financial tax burden on small businesses can increase both the workforce and economic sustainability in communities.

http://news.tennesseeanytime.org/node/6609

Persons with Disabilities
• 35th in average monthly social security supplemental security income payment (disability) in 2007
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.

Public Safety
• *3rd highest violent crime rate in 2008 (Includes murder, forcible rape, robbery, and aggravated assault)
• *3rd highest crime rate in 2008
(Includes murder, rape, robbery, aggravated assault, burglary, larceny-theft and motor vehicle theft)
• *2nd highest aggravated assault rate in 2008
(Aggravated assault is an attack for the purpose of inflicting severe bodily injury)
• *8th highest murder rate in 2008
• *8th highest robbery rate in 2008
• *31st lowest per capita state and local government expenditures for police protection in 2007. (National Average = $279 per capita, Tennessee = $221 per capita)
• ^48th: Violent Crime
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
^United Health Foundation: America's Health Rankings 2010. No. 1 is best; No. 50 is worst.

Jobs, Small Business, and Income (please double check all menu titles for correct naming)
• 2nd in personal bankruptcy rate in 2009. (National rate = 434 per 100,00/ Tennessee = 843 per 100,000)
• 36th in Per Capita personal income in 2009. (National per capita = $40,208 / Tennessee = $34,976)
• 45th median household income in 2008. (National Median = $51,297/ Tennessee = $41,978)
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.
Transportation
• 2nd in percentage of commuters who drive to work alone in 2008
• 15th in deficient bridges in 2008
• 40th in percent of commuters who travel to work by public transportation in 2008
• 47th in percentage of public road and street mileage federally funded in 2008
* Morgan, Kathleen O'Leary and Morgan, Scott. CQ Press's State Fact Finder Series: State Rankings 2010. Washington, DC, 2010.

Moving Forward
“To attract new businesses to our shores, we need the fastest, most reliable ways to move people, goods, and information -- from high-speed rail to high-speed Internet.
Our infrastructure used to be the best, but our lead has slipped. South Korean homes now have greater Internet access than we do. Countries in Europe and Russia invest more in their roads and railways than we do. China is building faster trains and newer airports. Meanwhile, when our own engineers graded our nation’s infrastructure, they gave us a “D.”
We have to do better. America is the nation that built the transcontinental railroad, brought electricity to rural communities, constructed the Interstate Highway System. The jobs created by these projects didn’t just come from laying down track or pavement. They came from businesses that opened near a town’s new train station or the new off-ramp.
So over the last two years, we’ve begun rebuilding for the 21st century, a project that has meant thousands of good jobs for the hard-hit construction industry. And tonight, I’m proposing that we redouble those efforts.
We’ll put more Americans to work repairing crumbling roads and bridges. We’ll make sure this is fully paid for, attract private investment, and pick projects based [on] what’s best for the economy, not politicians.”
-Remarks by President Obama in the State of the Union Address, January 25, 2011
The cooperation of state government is needed to support federal efforts to improve the highways and byways of American communities. These construction efforts may only be possible with the financial support of the federal government and a state tax infrastructure. Such support will bring much needed revenue to Tennessee which can be used to support existing projects and create new ones. Critical projects, such as the construction and repair of roads and structurally-deficient bridges, can only move forward when adequately funded. State leaders must enact legislation that can increase revenue to fund transportation initiatives that can become catalysts for economic growth and poverty reduction.

TN is a microcosm of nation's income inequality

Mother Jones has 11 charts that "explain everything that's wrong with America." Indeed, income inequality and the harshly skewed wealth distribution nationally and in Tennessee is a concern for Tennesseans for Fair Taxation. Our proposals would put more money directly in the wallets of most Tennesseans by eliminating the tax on food and reducing the general sales tax. The extremely wealthy should pay their fair share.
Here's an example from the article:

It's the Inequality, Stupid

Eleven charts that explain everything that's wrong with America.

By Dave Gilson and Carolyn Perot | March/April 2011 Issue

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How Rich Are the Superrich?

A huge share of the nation's economic growth over the past 30 years has gone to the top one-hundredth of one percent, who now make an average of $27 million per household. The average income for the bottom 90 percent of us? $31,244.

Note: The 2007 data (the most current) doesn't reflect the impact of the housing market crash. In 2007, the bottom 60% of Americans had 65% of their net worth tied up in their homes. The top 1%, in contrast, had just 10%. The housing crisis has no doubt further swelled the share of total net worth held by the superrich.

Winners Take All

The superrich have grabbed the bulk of the past three decades' gains.

Out of Balance

A Harvard business prof and a behavioral economist recently asked more than 5,000 Americans how they thought wealth is distributed in the United States. Most thought that it’s more balanced than it actually is. Asked to choose their ideal distribution of wealth, 92% picked one that was even more equitable.

Capitol Gain

Why Washington is closer to Wall Street than Main Street.

member	max. est. net worth
Rep. Darrell Issa (R-Calif.)	$451.1 million
Rep. Jane Harman (D-Calif.)	$435.4 million
Rep. Vern Buchanan (R-Fla.)	$366.2 million
Sen. John Kerry (D-Mass.)	$294.9 million
Rep. Jared Polis (D-Colo.)	$285.1 million
Sen. Mark Warner (D-Va.)	$283.1 million
Sen. Herb Kohl (D-Wisc.)	$231.2 million
Rep. Michael McCaul (R-Texas)	$201.5 million
Sen. Jay Rockefeller (D-W.Va.)	$136.2 million
Sen. Dianne Feinstein (D-Calif.)	$108.1 million
combined net worth:	$2.8 billion

Congressional data from 2009. Family net worth data from 2007. Sources: Center for Responsive Politics; US Census; Edward Wolff, Bard College.

Who's Winning?

For a healthy few, it's getting better all the time.

YOUR LOSS,THEIR GAIN

How much income have you given up for the top 1 percent?

Sources

Income distribution: Emmanuel Saez [1] (PDF)

Net worth: Edward Wolff [2] (PDF)

Household income/income share: Congressional Budget Office [3]

Real vs. desired distribution of wealth: Michael I. Norton and Dan Ariely [4] (PDF)

Net worth of Americans vs. Congress: Federal Reserve [5] (average); Center for Responsive Politics [6] (Congress)

Your chances of being a millionaire: Calculation based on data from Wolff [2] (PDF); US Census (household [7] and population [8] data)

Member of Congress' chances: Center for Responsive Politics [9]

Wealthiest members of Congress: Center for Responsive Politics [10]

Tax cut votes: New York Times (Senate [11]; House [12])

Wall street profits, 2007-2009: New York State Comptroller [13] (PDF)

Unemployment rate, 2007-2009: Bureau of Labor Statistics [14]

Home equity, 2007-2009: Federal Reserve, Flow of Funds data, 1995-2004 [15] and 2005-2009 [16] (PDFs)

CEO vs. worker pay: Economic Policy Institute [17]

Historic tax rates: Calculations based on data from The Tax Foundation [18]

Federal tax revenue: Joint Committee on Taxation [19] (PDF)

Read also: Kevin Drum on the decline of Big Labor, the rise of Big Business, and why the Obama era fizzled so soon. [20]

More Mother Jones charty goodness: How the rich get richer [21]; how the poor get poorer [22]; who owns Congress? [23]

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Source URL: http://motherjones.com/politics/2011/02/income-inequality-in-america-chart-graph

Links:
[1] http://www.econ.berkeley.edu/%7Esaez/pikettyqje.pdf
[2] http://www.levyinstitute.org/pubs/wp_589.pdf
[3] http://www.cbo.gov/publications/collections/tax/2010/all_tables.pdf
[4] http://www.people.hbs.edu/mnorton/norton%20ariely%20in%20press.pdf
[5] http://www.federalreserve.gov/pubs/oss/oss2/2007/scf2007home.html
[6] http://www.opensecrets.org/pfds/overview.php?type=W&year=2009&filter=C
[7] http://factfinder.census.gov/servlet/ACSSAFFFacts?_event=&geo_id=01000US&_geoContext=01000US&_street=&_county=&_cityTown=&_state=&_zip=80247&_lang=en&_sse=on&ActiveGeoDiv=&_useEV=&pctxt=fph&pgsl=010&_submenuId=factsheet_1&ds_name=DEC_2000_SAFF&_ci_nbr=null&qr_name=null&reg=&_keyword=&_industry=
[8] http://factfinder.census.gov/servlet/DTTable?_bm=y&-geo_id=01000US&-ds_name=PEP_2009_EST&-mt_name=PEP_2009_EST_G2009_T001
[9] http://www.opensecrets.org/news/2010/11/congressional-members-personal-weal.html
[10] http://www.opensecrets.org/pfds/index.php
[11] http://politics.nytimes.com/congress/votes/111/senate/2/276?ref=politics
[12] http://politics.nytimes.com/congress/votes/111/house/2/647
[13] http://osc.state.ny.us/osdc/rpt10-2011.pdf
[14] http://www.bls.gov/cps/prev_yrs.htm
[15] http://www.federalreserve.gov/RELEASES/z1/Current/annuals/a1995-2004.pdf
[16] http://www.federalreserve.gov/RELEASES/z1/Current/annuals/a2005-2009.pdf
[17] http://www.stateofworkingamerica.org/charts/view/17
[18] http://www.taxfoundation.org/publications/show/151.html
[19] http://www.jct.gov/publications.html?func=startdown&id=3719
[20] http://motherjones.com/politics/2011/02/income-inequality-labor-union-decline
[21] http://motherjones.com/politics/2006/05/look-numbers-how-rich-get-richer
[22] http://motherjones.com/politics/2006/07/poor-losers
[23] http://motherjones.com/politics/2010/09/congress-corporate-sponsors

Tax Breaks to Corporations Don't Guarantee Jobs!

Tennessee and its local governments are bending over backwards to give tax breaks to corporations in backroom recruitment deals.
Memphis Mayor AC Wharton said critics of such deals should "shut up" when he was criticized by the Shelby County Commission for a request that the county spend $1million on public infrastructure to support Japanese-owned Mitsubishi Electric's plan to build a $207 million factory in the city to produce electrical transformers.
"We're becoming a very easy target. ... We're going beyond (tax breaks) to where we're making direct capital investments in these companies, and I'm not sure we should be doing that," Commissioner Harvey said.
An AP article from 2/11/2011 points out that the commissioner is right to be concerned: "It's recently become an article of faith for many governors as they try to attract jobs: raising taxes during a recession is a nonstarter, choking off growth and damaging a state's fragile economic recovery.... But there's a catch to the anti-tax, pro-business rhetoric: Businesses consider a range of factors when deciding where to locate, including the quality of schools, roads and programs that rely on a certain level of public spending and regulation. And evidence suggests there is little correlation between a state's tax rate and its overall economic health.
"Concerns about taxes are overstated," said Matt Murray, a professor of economics at the University of Tennessee who studies state finance. "Labor costs, K-12 education and infrastructure availability are all part of a good business climate. And you can't have those without some degree of taxation."
To read the full article, go here.

What does corporate giant Amazon know that TN taxpayers don't?

Amazon plans to move to TN in late summer and appears confident it will get a special break in the law that requires all other bricks-and-mortar stores in the state to collect sales taxes. TFT hopes that the Haslam administration, the Department of Revenue, and our legislators will do the right thing and 1. not throw away this $64 million in revenue the state desperately needs; and 2. support Tennessee's small businesses who deserve a level playing field.

State Income Tax Does Not Harm Recruitment or Cause Residents to Flee

The Center on Budget and Policy Priorities lays it on the line: It is a myth that taxing those with high incomes causes them to flee states with these tax policies:
"States are addressing huge, recession-induced revenue shortfalls by cutting everything from kindergarten funding to services for Alzheimer’s patients — and more deep cuts are on the way. Policymakers should ask those who can best afford it to pay somewhat more, solid in the knowledge — and despite assertions to the contrary — that they won’t flee from higher income taxes. In short, policymakers should base taxes on the cost of meeting real needs, not on unfounded fears."
Read the full story here

Wisconsin's Fight is Our Fight

Supporting our public structures and public employees has always been a core value of TFT's work to address the economic injustice in our state's tax system. Tennessee's inadequate and unfair revenue structure has led to perpetual budget cuts, many of which hit public employees hardest, along with the millions of low- and middle-income Tennesseans who rely on the services our public employees provide (teachers for our children's public education, police officers and firefighters to protect our communities, infrastructure maintenance workers who provide us roads and bridges to travel on, and the list goes on and on).
Tennessee is considering legislation to remove the collective bargaining rights of our teachers, and other legislative proposals and proposed budget cuts would raise college tuition again, eliminate further public service jobs, and eliminate much-needed programs.
This article from alternet.org spells out the state of public employees in Wisconsin and nationwide, debunking many of the myths used by those who would undermine our public workers:

12 Things You Need to Know About the Uprising in Wisconsin

What's happening in Wisconsin is not complicated. At the beginning of this year, the state was on course to end 2011 with a budget surplus of $120 million. As Ezra Klein explained, newly elected GOP Governor Scott Walker then " signed two business tax breaks and a conservative health-care policy experiment that lowers overall tax revenues (among other things). The new legislation was not offset, and it turned a surplus into a deficit." (Update: please see this note for more detail on the cause of the budget gap.)

Walker then used the deficit he'd created as the justification for assaulting his state's public employees. He used a law cooked up by a right-wing advocacy group called the American Legislative Exchange Council (ALEC). ALEC likes to fly beneath the radar, but I described the organization in a 2005 article as "the connective tissue that links state legislators with right-wing think tanks, leading anti-tax activists and corporate money." Similar laws are on the table in Ohio and Indiana.

Walker's bill would strip public employees of the right to bargain collectively for anything but higher pay (and would cap the amount of wage hikes they might end up gaining in negotiations). His intentions are clear -- before assuming office, Walker threatened to decertify the state's employees' unions (until he discovered that the governor doesn't have that power).

But he's spinning the measure as something else -- a bitter pill state workers must swallow in order to save Wisconsin's government. So the first things you need to know are:

1. Wisconsin's public workers have already "made sacrifices to help balance the budget, through 16 unpaid furlough days and no pay increases the past two years," according to the Associated Press. The unions know their members are going to have to make concessions on benefits, but they rightly see the assault on their fundamental right to negotiate as an act of war.

2. There are already 13 states that restrict public workers' bargaining rights and it hasn't helped their bottom lines. As Ed Kilgore notes, "eight non-collective-bargaining states face larger budget shortfalls than either Wisconsin or Ohio," and " three of the 13 non-collective bargaining states are among the eleven states facing budget shortfalls at or above 20%."

3. This isn't just about public employees. What even a majority of the protesters don't know is that Walker's law would also place all of the state's Medicaid funding in the hands of the governor. State senator Jon Erpenbach, D-Middleton -- one of the Dem law-makers who fled the state to block a vote on the bill -- told local media that this amounted to "substantial Medicaid changes" that put "the governor, all of a sudden... in charge of Medicaid, which is SeniorCare, which is BadgerCare ...and he has never once said what he intends to do” with those programs. But the provision led journalist Suzie Madrak to conclude that "the end game for all this is to defund state Medicaid programs and make it impossible to serve as part of the new health care safety net."

4. Health-care costs, rather than workers' greed, are what has driven up the price of employees' benefits. But generally speaking, those public sector health-care costs have grown at a slower clip than in the private sector.

5. Public employees' pensions account for just 6 percent of state budgets.

This has nothing to do with the state's fiscal picture. Aside from potentially undermining Wisconsin's public health-care system, it's really about destroying the last bastion of unionism in the American economy: public employees. As Addie Stan wrote on AlterNet's front page:

Walker is carrying out the wishes of his corporate master, David Koch, who calls the tune these days for Wisconsin Republicans. Walker is just one among many Wisconsin Republicans supported by Koch Industries -- run by David Koch and his brother, Charles -- and Americans For Prosperity, the astroturf group founded and funded by David Koch. The Koch brothers are hell-bent on destroying the labor movement once and for all.

Consider these facts:

6. Last year, more working people belonged to a union in the public sector (7.9 million) than in the private (7.4 million), despite the fact that corporate America employs five times the number of wage-earners. 37 percent of government workers belong to a union, compared with just 7 percent of private-sector employees.

7. Whether in the public or private sector, union workers earn, on average, 20 percent more than their non-unionized counterparts. They also have richer retirement and health benefits -- the “union compensation premium” rises to almost 30 percent when you include those bennies.

That workers can still negotiate from a position of strength somewhere in the US is simply unacceptable to the right, and that's what this is about. As you might expect, the tool they're using in their campaign is a pack full of lies and distortions about public employees. Here are some answers to those falsehoods:

8. Public sector workers have, on average, more experience and higher levels of education than their counterparts in the private sector (they are twice as likely to have a college degree).

9. When you adjust for those factors, they make, on average, 4 percent less than their private-sector counterparts.

10. Like any group of workers with a high union density, they have better benefits, on average. But even including those benefits, state and local employees still make less in total compensation than they would doing the same work in the private sector.

11. In 2007, the average pension for a public sector worker was $22,000. Not exactly caviar dreams.

12. Many public employees are not eligible for Social Security -- those pensions, and whatever they can put away on their own, is all that they'll have in their golden years.

The Right has made great political progress getting Americans to ask the question: "How come that guy’s getting what I don’t have?" It’s the crux of the politics of grievance. Progressives need to get Americans to ask a different question: "What’s keeping me from getting what that guy has?" At least part of the answer is the Right’s decades-long assault on private sector workers’ ability to organize, and the latest battle is being waged in Wisconsin.

Stand with TFT at upcoming rallies in Nashville to support our public workers, good jobs, working Tennesseans, and a better state for today and tomorrow.

UPCOMING ACTION EVENTS TO DEFEND PUBLIC WORKERS AND SERVICES

Your voice is more important now than ever. A full-fledged attack on low-income families, women, public employees, unions and public services is being launched at both the federal and state levels. Please join TFT in speaking out. Several opportunities are coming soon:

STOP THE ATTACK ON HARDWORKING TENNESSEANS:
As we've seen in Wisconsin, Americans are standing up to politicians who are launching political attacks on firefighters, teachers, nurses, bus drivers, EMTs and other hardworking people who keep our communities safe. In Tennessee, the new majority in our state legislature is doing the same thing - waging attacks on hardworking Tennesseans and their families by pushing through legislation that will take away the rights of overworked and overwhelmed teachers to negotiate for fair pay and working conditions and take away the voice of thousands of hard working Tennesseans by barring them from participating in the political process.
Come out on Wednesday and stand with other hardworking Tennesseans and tell the State Legislature to stop attacking those of us who work hard everyday to keep our economy going and make our communities better.
Come and stand with other hardworking Tennesseans and tell the State Legislature to focus on Tennessee’s real priorities - creating quality jobs and fixing our economy.
Come and stand with other hardworking Tennesseans and tell the State Legislature that they should focus on how to improve the effectiveness of public sector jobs, not punish public sector workers.
Come and ask, "Why are you wasting time attacking hard working Tennesseans instead of focusing on the real priorities of this state?"
WHO: Tennessee Citizen Action, SEIU, AFL-CIO, Professional Firefighters, FOP, United Campus Workers, TEA, AFSCME.

TENNESSEE'S TEACHERS WILL NOT BE SILENCED:


LOBBY DAY FOR LIVING WAGES AND GOOD JOBS:
It's time to speak up for workers' rights in the state legislature. University workers (include those who make poverty pay) haven't had a
raise in over three years. A bill to repeal our Memphis and Shelby County living wage ordinances has been introduced. Bills have also been introduced to take away teachers' rights to be represented by a union, and a number of bills targeting immigrant workers are planned as well.
If you plan to join us for Lobby Day in Nashville, it's very important that you also register at WIN's website so we can set up appointments for you with your legislators http://bit.ly/hamA8C.
Training from Workers Interfaith Network and the United Campus Workers union will begin in Nashville at 9:00 a.m. and visits will conclude by 3:00 p.m. There will also be a rally for living wages and good jobs outside legislative plaza at noon.
Vans will be leaving from Midtown Memphis at 5:30 a.m. and return by 7:00 p.m., but you must register in advance on WIN's website if you'd like to ride with us.
You are also encouraged to participate in a Lobbying 101 training provided by WIN and the United Campus Workers the evening of Tuesday, March 8th (once you register we'll send you info about this training.)

Lobby Day Schedule
5:30 a.m. Vans leave Midtown Memphis
9:00 a.m. Training for legislative visits
10:00 a.m. Visits with legislators begin
Noon Rally for living wages and good jobs outside legislature
1:00 Lunch break on your own
1:45 Visits with legislators resume
3:00 Vans leave to return to Memphis
7:00 Arrive in Midtown Memphis

Your voice is needed to protect workers' rights. Every worker deserves fair pay, a safe place to work, and the right to have a voice on their job. Help send that message to your legislators by joining us for Lobby Day!

Amazon doesn't play fair - state loses while Internet Goliath posts record profits

The new governor's and new legislature's first months in office have shown their willingness to give corporate welfare handouts in one hand while the rest of the state gets program cuts and layoffs in the other. More than half of the state's revenue crisis would be solved if corporations were required to pay their fair share - the state could receive up to $600 million in additional revenue while it currently faces a $1 billion deficit.
Amazon has located two distribution centers in Tennessee, and the state and local governments are bending over backwards to pay most of the corporation's expenses, now with a proposed amendment that seems tailored to specifically reprieve Amazon of the legal requirement Tennessee business owners must follow to collect sales taxes in the state.
The current law states: "1320-5-1-.96 TANGIBLE PERSONAL PROPERTY SOLD BY DEALERS TO OTHER VENDORS WHERE DELIVERY IS MADE FOR USE AND CONSUMPTION. Except in cases where specific and satisfactory arrangements are made with the Commissioner before sales and deliveries are made, sales of tangible personal property or taxable services made by a dealer to an out-of-state vendor who directs that the dealer act as his (the out-of-state vendor) agent to deliver or ship tangible personal property or taxable services to his (the out-of-state vendor) customer, who is a user or consumer, are subject to the Sales or Use Tax. The dealer so acting as agent for the out-of-state vendor must collect the tax involved on the transaction unless the transaction comes within the conditions indicated herein."
The amendment would state: "The obligation under this rule to collect tax or provide a Tennessee resale certificate with respect to sales within Tennessee shall not apply, however, to any dealer operating as a distribution center. As used in this rule, a distribution center is a facility at which more than fifty percent (50%) of the gross receipts are derived from the delivery or shipment of orders, on behalf of another vendor, to destinations outside this state."
Interesting timing for such an amendment, as Amazon just agreed to locate two distribution centers in Tennessee, and recently announced plans to close its Texas distribution facility when the state asked it to pay its fair share in sales taxes. Texas sought $269 million in taxes - Amazon's worldwide sales surged nearly 30 percent in 2008 to $19 billion and topped $24 billion in 2009, two of the worst years in recent memory for U.S. retailers. I think they can afford to pay their fair share.
“Brick-and-mortar companies are going bankrupt and going out of business altogether and that is helping Amazon gain market share,” said Imran Khan, an analyst at JPMorgan, in a New York Times article titled "Amazon Posts Profit Gains as Offline Rivals Struggle."
Tax incentives for Amazon's recruitment to Tennessee include state grants, job-creation and property tax credits and money for employee training assistance, worth more than $30 million total for both sites.
"Under the agreement, Amazon gets a break on its property taxes for its 80-acre site in the Enterprise South industrial park, but it would pay 100 percent of the schools' share of the tax.
The county is giving up $435,884 in tax revenue per year, and receiving $429,624 in school taxes. The city will give up $722,716 in tax revenue per year.
Trevor Hamilton, the vice president of economic development for the Chattanooga Area Chamber of Commerce, said Hamilton County's and the city's portion of the incentives are worth a combined $9 million."
Many of the incentives have been touted for the economic boon in Amazon's "plans to hire several thousand people and inject at least $64 million in annual payroll into the area," but a closer looks shows the state is covering that cost for Amazon, too. The revenue TN would lose if the amendment passes to exempt "distribution centers" from collecting sales tax would range from $30 million to $60 million. Amazon would hire 1400 full-time workers and 2000 seasonal workers. If we assume 2 months for the seasonal workers and annual wages averaging $30,000, the total payroll would be $52 million. The tax break is roughly equivalent to TN paying the wages of all of Amazon's TN employees every year forever.
How does this make any sense?
A public hearing on the amendment is scheduled for Friday, Feb. 25, 2011, at 1:30 PM CST on the 3rd floor of the Tennessee Tower, 312 Rosa Parks Ave. in Nashville. If you want to join TFT in speaking out against corporate welfare handouts given from the wallets of Tennessee taxpayers, call or email our offices to join the fight!

Eat the Future?

Paul Krugman wrote an interesting opinion article for the New York Times on federal and state budget cuts and public perception of tax and revenue issues:
Eat the Future
By PAUL KRUGMAN
On Friday, House Republicans unveiled their proposal for immediate cuts in federal spending. Uncharacteristically, they failed to accompany the release with a catchy slogan. So I’d like to propose one: Eat the Future.

I’ll explain in a minute. First, let’s talk about the dilemma the G.O.P. faces.

Republican leaders like to claim that the midterms gave them a mandate for sharp cuts in government spending. Some of us believe that the elections were less about spending than they were about persistent high unemployment, but whatever. The key point to understand is that while many voters say that they want lower spending, press the issue a bit further and it turns out that they only want to cut spending on other people.

That’s the lesson from a new survey by the Pew Research Center, in which Americans were asked whether they favored higher or lower spending in a variety of areas. It turns out that they want more, not less, spending on most things, including education and Medicare. They’re evenly divided about spending on aid to the unemployed and — surprise — defense.

The only thing they clearly want to cut is foreign aid, which most Americans believe, wrongly, accounts for a large share of the federal budget.

Pew also asked people how they would like to see states close their budget deficits. Do they favor cuts in either education or health care, the main expenses states face? No. Do they favor tax increases? No. The only deficit-reduction measure with significant support was cuts in public-employee pensions — and even there the public was evenly divided.

The moral is clear. Republicans don’t have a mandate to cut spending; they have a mandate to repeal the laws of arithmetic.

How can voters be so ill informed? In their defense, bear in mind that they have jobs, children to raise, parents to take care of. They don’t have the time or the incentive to study the federal budget, let alone state budgets (which are by and large incomprehensible). So they rely on what they hear from seemingly authoritative figures.

And what they’ve been hearing ever since Ronald Reagan is that their hard-earned dollars are going to waste, paying for vast armies of useless bureaucrats (payroll is only 5 percent of federal spending) and welfare queens driving Cadillacs. How can we expect voters to appreciate fiscal reality when politicians consistently misrepresent that reality?

Which brings me back to the Republican dilemma. The new House majority promised to deliver $100 billion in spending cuts — and its members face the prospect of Tea Party primary challenges if they fail to deliver big cuts. Yet the public opposes cuts in programs it likes — and it likes almost everything. What’s a politician to do?

The answer, once you think about it, is obvious: sacrifice the future. Focus the cuts on programs whose benefits aren’t immediate; basically, eat America’s seed corn. There will be a huge price to pay, eventually — but for now, you can keep the base happy.

If you didn’t understand that logic, you might be puzzled by many items in the House G.O.P. proposal. Why cut a billion dollars from a highly successful program that provides supplemental nutrition to pregnant mothers, infants, and young children? Why cut $648 million from nuclear nonproliferation activities? (One terrorist nuke, assembled from stray ex-Soviet fissile material, can ruin your whole day.) Why cut $578 million from the I.R.S. enforcement budget? (Letting tax cheats run wild doesn’t exactly serve the cause of deficit reduction.)

Once you understand the imperatives Republicans face, however, it all makes sense. By slashing future-oriented programs, they can deliver the instant spending cuts Tea Partiers demand, without imposing too much immediate pain on voters. And as for the future costs — a population damaged by childhood malnutrition, an increased chance of terrorist attacks, a revenue system undermined by widespread tax evasion — well, tomorrow is another day.

In a better world, politicians would talk to voters as if they were adults. They would explain that discretionary spending has little to do with the long-run imbalance between spending and revenues. They would then explain that solving that long-run problem requires two main things: reining in health-care costs and, realistically, increasing taxes to pay for the programs that Americans really want.

But Republican leaders can’t do that, of course: they refuse to admit that taxes ever need to rise, and they spent much of the last two years screaming “death panels!” in response to even the most modest, sensible efforts to ensure that Medicare dollars are well spent.

And so they had to produce something like Friday’s proposal, a plan that would save remarkably little money but would do a remarkably large amount of harm.

Support TFT friend TIRRC

The Tennessee Immigrant and Refugee Rights Coalition has a great campaign going this weekend to celebrate Valentine's Day and immigrant rights!
For $5, you can send a valentine to the legislator of your choice with messages like "Roses are Red, Violets are Blue, Immigrant Families Pay Taxes Too."
In other fundraising news, TFT could win $5,000 from Guidestar if our members write the most reviews on their website this month. Go here to write your review of TFT and lend your support to our work to advance revenue and justice for ALL Tennesseans. Thank you!

Momentum Continues to Grow for Out-of-State Sales Tax Act

Knoxville's WATE.com has this story regarding the growing outcry for Amazon to be required to collect sales tax in Tennessee now that the company has physically located to the state:

By MONA NAIR
6 News Reporter

KNOXVILLE (WATE) – Several Tennessee business owners are angry that Amazon.com is asking for a sales tax exemption.

Amazon is building two distribution centers in Hamilton and Bradley counties making a $139 million investment and bringing in 1,400 jobs.

Tennessee-based retailers are required to charge their customers a sales tax, but Amazon may be rewarded for its investment by not having to do the same.

Don Fowler runs Fowler's Furniture based in Knoxville. He says it is tougher to do business when you charge the tax.

For example, Fowler showed us one customer's bill for $9,960 that had a $944.47 sales tax tacked on to it.

Fowler believes if he's forced to charge his customers sales tax, Amazon should have to do the same.

"You ask me what my thoughts are, in one word, it stinks. It is awful. They're going to pick this one business and basically stick it to all the other thousands of businesses in the state. It'll never fly," Fowler said.

There have been full-page advertisements in the local paper by the national group "Alliance for Main Street Fairness." They are calling for no special interest loopholes, asking the people to call the state to make sure Amazon charges sales tax, too.

Right now regular Amazon shoppers in Tennessee like Brandon LeCompte don't pay any sales tax. In fact, he likes the website because it's cheap.

"As a college student, I pay more than enough for textbooks. Getting charged a sales tax on top of that will trouble me more," LeCompte said.

If the opposition stays strong, LeCompte and others in Tennessee will see an extra charge at Amazon. It will be the same sales tax they pay at Fowler's Furniture and every other retailer in the state.

Fowler believes that Gov. Bill Haslam being a businessman will help their case. He says because Gov. Haslam understands how unfair this is to local businesses, he does not believe this will be approved.

News Sentinel says Income Tax Ban a Bad Idea

This from the Feb. 9 News Sentinel:

TAX BAN WOULD ALSO HAMPER OPENNESS

A constitutional amendment definitively barring a state income tax has been introduced once again into the Tennessee General Assembly.

The joint resolution contains a provision that should send a chill up the spine of everyone who cherishes open government, regardless of their position on an income tax.

The resolution would be a step toward amending the state constitution to prohibit the state and all local governments from levying income or payroll taxes. Other than a tax on interest and dividends, the constitution doesn't authorize the General Assembly to levy an income tax, but it doesn't explicitly bar such a tax either.

The most troubling aspect of the resolution, however, is an addition that would close the windows on government activities in Tennessee by allowing the only public notice of the amendment to be postings on the Secretary of State and General Assembly websites. That's unacceptable.

The joint resolution is sponsored by state Sen. Brian Kelsey, R-Germantown and state Rep. Glen Casada, R-Franklin. Local lawmakers like state Sens. Jamie Hagood and Stacey Campfield, as well as state Reps. Steve Hall and Frank Nicely, have signed on as co-sponsors.

A similar measure was allowed to die last year, but the measure might have a better chance this year with Republicans firmly in control of both legislative houses.

Regardless of the amendment's content, the fiscal note accompanying the resolution should give everyone pause.

If the resolution is adopted by both houses, it then would have to be approved by the next General Assembly, which convenes in 2013, before heading to the voters in 2014.

Article XI, Section 3 of the state constitution requires the publication of the amendment in between the legislative votes. That's traditionally meant publication in the state's newspapers. The fiscal note attached to this bill, however, "assumes" that electronic publication alone complies with the constitution.

While the constitution was adopted before the Internet was an option and its use is open to interpretation, we don't think that posting a notice on a government website is sufficient. Too many Tennesseans - about one in four - don't have computers or access to the Internet. The government in such cases should be proactive in pushing information out to the people rather than forcing citizens to go digging through government websites to find it.

If government websites are considered adequate as the only venue for public notice, then all public notices - announcements of public meetings, invitations to bid on government contracts, foreclosures and others - could become harder to find as well.

One might even argue that confining public notices to government websites is like letting foxes guard the henhouses. Just wait and see what sort of slip-ups start happening in public notices then.

The point of the publication requirement is to inform more, not fewer, people, and changing it in this manner should be viewed as an affront to every Tennessee resident.

The question is this: if Kelsey and Casada believe this amendment is right for Tennessee, why won't they use the tried-and-true method of telling Tennesseans about it? What are they afraid of?

© 2011, Knoxville News Sentinel Co.

Rebuilding Prosperity for States and Families

This and more from the Progressive States Network:

Progressive Tax Reform and Revenue Generation
Context: Although the recession may have subsided at the national level, 2011 still finds states reeling from historic budget shortfalls, high unemployment, and significant revenue declines, and will continue to face fiscal challenges in the upcoming year. The lingering effects of the downturn and subsequent revenue shortfalls have forced state lawmakers to consider extreme fiscal measures to confront budgetary constraints. What’s more, states have already utilized a substantial portion of the federal funds available for state fiscal relief through the American Recovery and Reinvestment Act (ARRA).

Why this Matters: These dire circumstances merit progressive tax and budget policy as a means to provide essential services, make critical investments in public structures and long-term growth areas, support working and middle-class families who have been disproportionately hit by the impact of the downturn, alleviate the disturbing regressivity of state tax structures, and ensure that all taxpayers are contributing their fair share.

Some states and localities have unfortunately reverted to regressive proposals that will only exacerbate economic pain. For instance, conservative officials in some states are proposing providing large corporations with enormous tax breaks and reducing or even eliminating corporate, personal income, and estate taxes. In Michigan, lawmakers are attempting to push through over $1 billion in corporate tax breaks and considering cutting the state’s earned income tax credit (EITC), a tax credit that not only assists working families, but also has a direct positive impact on the economy. Similarly, Arizona Gov. Jan Brewer aims to balance her state’s budget on the backs of the vulnerable. Brewer has expressed her intent to cut health care for 280,000 Arizonans, while advocating for a slew of imprudent business tax cuts. These proposals would do little more than exacerbate fiscal pain, halt economic growth, and increase the burden on the middle class and working families.

While the right-wing continues on its anti-tax crusade, Colorado’s experience with the so-called Taxpayer Bill of Rights, or TABOR, exposes the fallacy of their manipulative rhetoric on the economic impact of tax cuts. In 1992, the state instituted TABOR, which places extremely strict limits on state and local revenue growth. Following implementation, TABOR resulted in: enormous declines in K-12 education funding and investments in students, increased tuition rates, the elimination of an affordable housing loan and grant program, an exponential rise in the number of children and adults who lacked health insurance, hindered essential services for vulnerable populations in the state, and limited the ability of the state to invest in infrastructure and other public structures that contribute to a healthy economy. Coloradans, including a range of elected officials and business leaders, were extremely dissatisfied with the insidious policy and, in 2005, voted to weaken TABOR rules.

Research and historical precedent demonstrate that raising revenue in a progressive manner is economically sound, politically feasible, and popular with the public - especially compared to massive cuts in investments in education, infrastructure, and health care that endanger a state's economic security and social vitality.

States should institute tax reforms that benefit the middle class. While the Right commonly argues that the tax onus falls squarely on the high-income families, the reality is that the richest have not been contributing their fair share for years. When you factor in sales and excise, property, and income taxes, states tax working families far more heavily than richer individuals, according to Who Pays?, a report from the Institute for Taxation and Economic Policy.

Moreover, corporate income tax revenue as a share of all taxes has fallen dramatically. In 1979, the corporate income tax accounted for 10.2 percent of total state tax revenue. In 2005, the figure fell to 6.5 percent. At the federal level, two thirds of American corporations and foreign corporations doing business in the United States pay absolutely no taxes, despite taking $2.5 trillion in sales.

The public also views the tax system as skewed to benefit the affluent. Sixty percent of voters say that “upper income people” are not paying their fair share, while 67 percent say that corporations are not.

Additionally, common-sense revenue solutions are needed to invest in the economy. As a report by the
Economic Opportunity Institute denotes, "every dollar of state spending generates $1.41 of economic activity. Much of that spending – 62%, or 88 cents – boosts the private sector. Cutting state spending means fewer purchases from suppliers, reduced contracts with service providers, less money from public and private employee paychecks circulating through local businesses – and of course, fewer public services."

Polling suggests strong public support to achieve these ends. In fact, a 2009 poll found that 79 percent of the public believes “government investments in education, infrastructure, and science are necessary to ensure America’s long-term economic growth.”

A joint statement released by the AFL-CIO and Chamber of Commerce -- two organizations that are usually on opposite ends of the ideological spectrum from one another -- expressed a similar sentiment on the need for investment and improvement in infrastructure. This illustrates that investment in economic growth is not a partisan issue -- it is a necessary step to prosperity that should garner support from both progressives and conservatives. As the statement reads, "whether it is building roads, bridges, high-speed broadband, energy systems and schools, these projects not only create jobs and demand for businesses, they are an investment in building the modern infrastructure our country needs to compete in a global economy... we hope that Democrats and Republicans in Congress will also join together to build America's infrastructure."

Local governments in Tennessee may consider raising taxes to cover growth

From the Tennessean:

People aren't building houses in Williamson County like they used to. But you wouldn't know it from looking at the schools.

Annual revenues from the county's privilege tax on home construction have shrunk from about $10 million to $1 million since 2007. Yet Williamson opened three schools last summer and is building two more to open later this year.

"The last couple of years, we've gotten a lot of new students because of the economy," said David Coleman, the county's budget director for almost 16 years. "Some of them are pulling out of private schools."

Now the county, growing but also suffering from the economic downturn, is thinking about how it will pay for that growth. Its answer might be a tax increase.

As they try to keep pace with infrastructure needs, employee pay raises, benefit costs and other demands while worrying that the state could eliminate a key revenue stream, local governments — even in relatively affluent places such as Williamson County — find themselves in an environment that could call for raising taxes.

Mt. Juliet is trying to figure out how to obtain more fire protection at a time when Wilson County, which provides it, says it can't afford to do anything more. Belle Meade and Brentwood are worried about losing an important source of revenue if the General Assembly kills the Hall Income Tax.

Bert Chalfant, a Williamson County commissioner who has represented part of Brentwood for the past 25 years, said talk of a tax increase was "far too premature." But he acknowledged the pressures of growth.

The Williamson school district regularly builds schools in an attempt to accommodate an ever-expanding student body, which has grown by almost 20 percent in the past five years.

"We are a very desirable place to live," Chalfant said. "We've shown continued and steady growth. Growth requires occasional adjustments as it comes to big infrastructure."

Some other counties have said tax increases are off the table as unemployment rates remain high and residents continue to carry the burden of the recession.

Metro asks for cuts

"We're going to function within our revenues and put together the best budget we can," said Metro Finance Director Rich Riebeling, one of Mayor Karl Dean's top aides. "It's not the right time to raise taxes."

Riebeling asked Metro department heads Thursday to present budgets this spring based on 3 percent cuts, though some departments won't be reduced that much.

He said Dean wants to fund education and public safety at current levels or better.

Metro's sales tax revenues haven't grown as much as Dean's administration would like. The May flood's impact on operations at Opry Mills mall, which remains closed, and the Opryland hotel were significant.

The city has reduced the size of government by 435 budgeted positions and more than $46 million over the past three years, according to Riebeling's memo to department heads.

Tax talk, fire coverage

At a recent meeting of the Williamson County Commission's tax study committee, Coleman said adding 23 cents to the property tax rate — which is now $2.31 per $100 of assessed value — would be necessary to meet the county's debt service requirements in 2011-12.

At the same time, the school district's finance director, Leslie Holman, said an additional 24 cents could be needed to operate new schools, raise pay for teachers and cover increases in health insurance.

Coleman said the county could raise the property, sales or wheel taxes. Every penny added to the property tax rate would generate about $685,000 for the general fund — $15.75 million from 23 cents — or about $615,000 for schools, with 24 cents producing $14.76 million.

A half-cent sales tax increase, which would require cooperation from cities like Brentwood and Franklin, could bring in $7 million to $8 million annually, Coleman said. Every $5 added to the wheel tax, which is now $25, would generate $800,000.

The county commission and school board will hold a joint meeting to talk about the situation on Feb. 14.

"We're looking for some guidance," Coleman said.

To the east, Mt. Juliet is wrestling with the need for more fire protection for an area that has grown from a small farming community into a city with multistory hotels and apartment complexes. But Wilson County Mayor Randall Hutto recently told Mt. Juliet that the county was stretched to its limit.

Mt. Juliet Mayor Linda Elam said the city wouldn't necessarily need to raise taxes to address the problem, though it might incur additional debt. Mt. Juliet could build a fire hall on its own for $1 million to $4 million and turn it over to the county to operate, or it could partner with Lebanon on a new facility.

Meanwhile, state legislators are talking again about eliminating the Hall Income Tax on dividends and interest. The state collected $172 million from the tax last year and sent $62 million back to counties and cities.

Brentwood City Manager Mike Walker said the tax brings in about $2 million a year, more than 6 percent of a $30 million budget. If Brentwood lost that money, it would need to raise the property tax rate 10 cents or start making cuts.

"It's a significant amount," Walker said. "You're faced with decisions relative to service delivery. We're just trying to live within our means. We've got enough challenges already."

The Williamson County city of about 36,000 people includes 2,915 residents who pay the Hall Income Tax.

Debt restructured

Other communities say they're in good shape for now. Rutherford County, which raised the property tax rate by 17.5 cents two years ago, doesn't expect to raise it again for the next fiscal year, which starts July 1, Finance Director Lisa Nolen said.

In Hendersonville, the budget is likely to be flat, with no tax increase and no changes in expenditures, said Don Long, an assistant to Mayor Scott Foster.

Sumner County has one of the region's lowest tax rates, but it also has adequate reserves and is planning to restructure some of its debt while interest rates are low, County Executive Anthony Holt said.

"We have plenty of challenges, like all communities," Holt said. "We're growing. But I don't anticipate a request for a tax increase.

"We've tried to take the opposite approach and make cuts where we need to. It's tough to ask citizens to make a sacrifice if the government's not making one."

TN Budget Cuts: $1 Billion (continued)

The TN Dept. of Environment and Conservation presented its budget proposal yesterday as Gov. Haslam continues to plan for the state's 2011-12 budget under a $1 billion+ deficit.
TDEC Commissioner Bob Martineau noted a UT study of state parks that found they provide $1.5 billion in total industry output and 18,600 jobs. For every dollar allocated, more than $17 is generated back into the economy. While the jobs and economic output created by the department is much-needed, it has lost $14 million in state appropriations over the last three years (that's $238 million NOT generated back into the economy), and eliminated 300 jobs as a result.
Yesterday's presentation indicated additional cuts in 2011-12 would eliminate 10% of job positions in groundwater protection - The Division of Ground Water Protection's duty is to regulate onsite wastewater disposal in a manner that is protective of the ground water of Tennessee and in such a way as to minimize the possibility of endangering the health and welfare of the public. The presentation also indicated budget cuts would also lead to closing of state parks and public pools, and an inability to maintain existing structures in state parks, some which are historic and could endanger park visitors if not properly maintained.
Let your representatives know we can't afford to lose more state jobs and the economic stimulus our state parks provide!
Go here and copy and paste the following into the message box - or write your own message asking for REVENUE, NOT CUTS:
"As Gov. Haslam hears departmental presentations on the 2011-12 Tennessee state budget, I urge you to consider revenue-generating measures to avoid further cuts and jobs losses that will harm the state's economy and its residents. Tennesseans for Fair Taxation has solutions that could provide 2/3 of Tennesseans a tax cut while generating $1 billion in additional revenue for the state. Please support the Out-of-State Sales Tax bill, the Tennessee Small Business Protection bill, the Tax Cut and Job Creation bill, and the Single Article Cap Removal bill to provide Tennessee the revenue it sorely needs to invest in our communities and protect our residents. Thank you."

TN Budget Cuts: $1 Billion

Gov. Haslam is in the midst of departmental hearings as he prepares to draft the 2011-12 state budget while facing a $1 billion deficit. So far, proposed cuts have fallen on college students, people with disabilities, and people of color. Tuition and fees at four-year universities have already risen 74 percent since 2001, and tuition and fees at two-year colleges have risen 126% in the same time period. The Minority Health Initiative that addresses health issues that disproportionately affect people of color is facing elimination. Operating costs for schools for the deaf and blind are threatened. Almost every department testifying in the hearings included layoffs and job elimination in their proposals.
The sad thing is that none of these proposed budget cuts are necessary. The proposals advocated by TFT could raise more than $1 billion in revenue for the state AND give 2/3 of Tennesseans a tax cut.

Video: Tennessee Budget Hearings

From the Chattanooga Times Free Press:
NASHVILLE — Gov. Bill Haslam warned Monday of "hard" choices ahead in Tennessee's upcoming 2011-12 budget as the state's new chief executive held his first hearings on state spending.

"I think what you're seeing is a lot of those things that were cut last year on paper but haven't been implemented yet," Haslam told reporters. "There's some painful things there."

Cuts have been masked until now with some $1.5 billion in one-time federal stimulus funds. But the money largely disappears beginning July 1, Haslam noted. While revenues have been coming back, Haslam said they cannot offset much of the previously made cuts, so the state must "prioritize."

In the meantime, Haslam is trying to create elbow room in the budget for his priorities such as fully funding inflationary and student enrollment growth in the state's Basic Education Program formula for K-12 education. That comes to about $68 million.

"We made a commitment to fully fund the BEP, and I've said all along that would be one of our priorities," Haslam said. "We're committed to doing that."

Departments across state government have been asked to provide for additional cuts of 1 percent to 3 percent. Those come on top of major cuts in previous years, including those that were offset by federal stimulus funds.

Among those making budget presentations Monday was interim Health Commissioner Susan Cooper, a holdover from the Bredesen administration.

In her plans for additional cuts, Cooper outlined additional reductions of up to $3.59 million that include shuttering two health clinics providing services for the poor.

But she sought to make the case to Haslam and Finance Commissioner Mark Emkes to continue some of the $32.9 million in programs cut last year but continued through July 1 with federal funds.

Among programs Cooper urged the governor to support was a $7 million diabetes initiative. It has helped pull the state's diabetes rate down from 11.9 percent to 10 percent, she said.

Emkes, a former Bridgestone CEO, agreed with Cooper that such programs can offset future health care costs. He said he wished officials could "double your budget" on such initiatives.

Observed Haslam, a former Knoxville mayor who touted his budgetary experience during his campaign: "Let me know what you're going to cut in half" to achieve that wish.

Cooper suggested some aspects of the diabetes program could be cut. She also suggested the state cut funding for a $30,600 shaken baby syndrome program and $860,100 now spent on a minority health initiative, among other programs.

Interim Education Commissioner Patrick Smith noted the proposed K-12 budget includes restoring about $57 million in programs extended through federal stimulus funds and another $12.2 million in programs saved through state budget reserve funds. The federal programs he advocated saving included $15 million in extended contracts for Career Ladder teachers.

He recommended $500,000 in public television system grants be restored.

"We've identified many of those same things that were funded with one-time money this year as being worthy of consideration to continue funding with one-time money in the ensuing fiscal year," Smith said.

The administration also heard from higher education officials.

At this point, the Haslam administration is missing an important piece in the budget puzzle — budget projections for the 2011-12 budget year that begins July 1.

In the meantime, the state is dealing with a bigger total budget than the $29.9 billion 2010-11 spending plan that Bredesen administration officials last spring estimated was passed by state lawmakers.

The final budget, which includes federal spending, actually totals about $31.3 billion, more than $1 billion higher than previously estimated, state Finance and Administration Department officials recently said.

Reasons for the increase included higher education tuition increases and Congress' eventual extension of more generous Medicaid match rates, which benefit TennCare.

From the TN Report:
Gov. Bill Haslam kicked off a four-day stretch of departmental hearings Monday as a warm-up to drafting his first state budget.

The new governor digested spending-plan projections from some heavy fiscal hitters right off the bat, including the Departments of Health, Education and Higher Education, which all had to present budget scenarios with reductions of 1 percent and 2 percent.

“We have 23 departments, if you add up all the requests, it will be a number obviously that we can’t fund,” Haslam said during a short break between hearings. “It’s their job to request that and to prioritize that … and then we have to wade through that at the end of the day.”

Haslam said he’s confident there’ll be fewer employees on the state payroll under his budget plan. But he said reductions need to be made “surgically” instead of by slashing staff with massive layoffs.

Haslam also heard from the Departments of Tourist Development and Financial Institutions Monday. On Tuesday, he is scheduled to hear from the Education Lottery Corporation and the Departments of Environment and Conservation, Transportation, Labor and Workforce Development, Corrections, Veterans Affairs, General Services, Commerce and Insurance, and Economic and Community Development. Hearings are expected to continue through Thursday morning.

Here are some highlights from Monday’s hearings:

Education

Education officials proposed an increase of $423 million in the state-funded portion of its budget, bringing the overall budget to $5.1 billion. Acting Education Commissioner Patrick Smith said the increase is composed of pay increases and increased state funding to schools mandated by inflation and the state’s school funding formula.

Haslam told reporters that he’s committed to fully funding schools as called for under the formula, known as the Basic Education Program.

“If you look at new dollars that are available in the state, at the end of the day, about half of them will be end up taken up in (Basic Education Program) formula and TennCare increases, just by formula, not by doing anything different,” he said.

Smith outlined about $3.5 million in possible cuts, which would eliminate positions and supply costs. The proposal would also reduce operating costs for the state’s schools for the blind and deaf, cut grants that support public television stations operated by schools and reduce other programs.

The total education budget is estimated to decrease this year by about $510 million because of a $1 billion reduction in federal funds.

Tourist Development

State tourism officials say they want to build two new “Welcome Centers,” even though all departments have been asked to propose reductions to their annual budget as one-time federal stimulus dollars run out this year. According to the department, the state currently operates 14 Welcome Centers across the state.

They described plans to build a center as part of a solar farm in Haywood County, and another visitor center along I-26 in Sullivan County.

Haslam questioned the expansion plans: “I’m just wondering why, in tight times, we’re adding them.”

The centers had “been on the books for 10 years,” and the planning and funding had been approved for several years as well, Department Commissioner Susan Whitaker said.

Health

Haslam opened his first budget hearing with Commissioner of Health Susan Cooper, who emphasized the department’s role in instilling good health into all environments and not specifically focused on individual clinical care. She addressed disease prevention and outbreak investigations, immunizations, licensing facilities and emergency preparedness.

The department employs roughly 3,000 people.

She noted that in 2005 the state ranked 48th in the nation in health status but is now 42nd, crediting decreased use of tobacco and returns on investment in community efforts to fight diabetes.

Haslam set the tone early that he would ask many questions along the way, frequently interjecting and asking if stimulus funds had been involved in expenditures.

Cooper noted that good health factors can be attractive to new businesses. She outlined a base budget of $539 million.

The department offered several potential budget reduction areas such as travel, cutting communications costs, abolishing a few positions and eliminating a hemophilia program, which she quickly added would require a change in statute.

Higher Education

Joe DiPietro, president of the University of Tennessee, and John Morgan, chancellor of the Tennessee Board of Regents made their first budget appearances since taking their new positions. The message they gave Haslam was that while there are great financial challenges facing the system, the state has high value in its higher education institutions.

Richard G. Rhoda, executive director of the Tennessee Higher Education Commission led off the presentation and underscored the financial crunch by telling Haslam that in the last 10 years enrollment at the state’s four-year schools has gone up 22 percent but that they have seen appropriations fall 33 percent. At the same time, tuition and fees have risen 74 percent.

Meanwhile, Rhoda said, enrollment at two-year schools is up 38 percent during that period while appropriations are down 26 percent. But in that time, tuition and fees for those schools have risen 126 percent.

Morgan said space constraints are a serious problem at many of the state’s technology centers. DiPietro said one issue facing UT is that some buildings are over 40 years old and in need of repairs. When Haslam asked the higher ed panel if they had any creative ideas to address the financial stress on the system, one possibility Morgan raised was to apply means-testing to the HOPE scholarships derived from the state’s lottery. Haslam said after the hearing he is not ready to take such a step.