Democrats announce budget framework to invest in Tennessee’s recovery, health and future

Sens. Jeff Yarbro, Raumesh Akbari highlight economic investments, alternatives to extreme budget cuts

NASHVILLE — Democratic leaders unveiled a budget framework today they say lawmakers should adopt to improve the health of Tennesseans and invest in the state’s economic recovery from the Covid-19 crisis.

The six-point budget outline and legislative policy changes proposed by Senate Democratic leaders consider all options to achieve a shorter, more fair recovery. Their priorities include:

• Contain the coronavirus to protect families and ensure a safer reopening;
• Extend health coverage to every essential and frontline worker through Medicaid expansion;
• Preserve investments in our future, such as public education;
• Use a balanced approach to the budget that draws on savings and trims costs;
• Implement cost-saving reforms, such as criminal justice policy; and
• Unleash new economic opportunities.

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“Too many Tennesseans were living paycheck to paycheck before this pandemic and economic crisis hit, and the state budget crunch should not fall disproportionately on the economic investments and services we will need to help them recover,” said Sen. Jeff Yarbro, the Senate minority leader. “There are lessons to be learned from Gov. Bredesen’s leadership during the Great Recession when budgets were balanced without layoffs or furloughs, without raiding pensions, and without sacrificing our long-term investment in public education.”

Democrats are advancing these budget priorities ahead the legislative session, which is scheduled to resume after Memorial Day.

“We are presenting an alternative framework to extreme cuts; options that allow us to invest in the health of every essential worker, provide a much-needed boost to Tennessee’s economy and protect investments in our public schools and services that are key to our recovery,” Sen. Raumesh Akbari, D-Memphis, the Senate Democratic caucus chairwoman, said. “Using a balanced approach — where we cautiously utilize state reserves, trim the budget and enact cost-saving reforms — we can maintain investments in our future and implement measures that safeguard our families and economy from a potentially devastating second wave of the virus.”

The Tennessee General Assembly recessed due to the coronavirus pandemic in March after approving a budget for 2020–2021 that assumed no growth in revenues for the fiscal year beginning July 1. But with many businesses forced to shutdown because of the virus, some analysts and economists are now forecasting a decrease in state tax collections.

Though collections were down in April, the virus’ effect on state revenues will not be known fully until July the tax filing deadline for businesses in the state.

Lacking more comprehensive data, Democrats are calling for a careful, balanced approach to the budget, Sen. Yarbro says.

“It would be foolish to make budget decisions that make the economic recovery harder and reckless to balance the budget on the backs of state employees,” Sen. Yarbro said. “The legislature cannot be irresponsible with cuts that would lead to more closed hospitals, more unemployed or uninsured Tennesseans, or more poorly educated children.

“We cannot mortgage Tennessee’s future in responding to the present crisis,” Yarbro said.

Democratic Priorities

Contain the virus and ensure a safer reopening

• Ramp up efforts to track and isolate every new Covid-19 case and the people with whom they came in contact.
• Provide assistance and support to those who have to quarantine.

“Tracking and isolating (the virus) is basically an insurance policy against a 2nd wave,” Sen. Akbari said. “Everything is made exponentially worse if we have to shut down businesses and schools again this summer, fall or winter.”

Extend health coverage to every essential worker through Medicaid expansion

Some workers who were deemed essential or frontline workers are not offered health insurance coverage through their employers and cannot afford private health coverage through the marketplace.

Under the Democratic framework, every essential and frontline worker — whether you’re a caregiver, grocery store worker, distribution worker, farmer or plant worker — would have access to quality health coverage through Medicaid expansion, a policy change that would also provide a billion dollar boost to the state’s health care economy and new revenue streams for hospitals hurt by the pandemic.

In 2015, a University of Tennessee economist estimated Medicaid expansion would create 15,000 new jobs in Tennessee health care industry.

Preserve investments in our future

• Protect investments in students and educators at public schools, colleges and technology schools.
• Maintain programs and services that reach the most vulnerable in the state.
• No mass layoffs or furloughs that would affect or reduce resources that Tennesseans will need for recovery.
• No budget balancing through base salary cuts or by raiding retirement accounts.

Use a balanced approach to the budget

• Find budget savings by cutting, delaying or reducing costs in the no-growth budget.
• Pause the repeal of tax breaks and adjust the new marketplace facilitator tax to include online retailers with more than $100,000 in sales.
• Establish a four- to five-year plan to cautiously spend down the billions in state reserves and savings.

Implement bipartisan, cost-saving reforms

• Criminal justice reforms, some of which are championed by Gov. Bill Lee, could save more than $175 million each year.
• Expanding Medicaid also save tens of millions of dollars by making several state health programs serving low-income populations obsolete

Unleash new economic opportunities

• Made-in-Tennessee: Deploy the purchasing power of state government and prioritize the purchase of Tennessee-made products and services. Putting Tennessee businesses first boosts the state economy and increases revenues.
• Scale up apprenticeship programs: Tennessee contractors and trade businesses need more workers. These are good paying jobs, usually with good benefits. Expanding apprenticeship and retraining programs like Go Build would meet market demands, help small Tennessee businesses and boost our state economy.
• Move forward with medical marijuana or recreational cannabis: Before the majority party explores extreme cuts, measures that other states have adopted to improve their finances should be considered. Tennesseans are done fighting about cannabis; cancer patients should be able to access to marijuana-based medicine, other states have shown it can be regulated like alcohol, and farmers, who were decimated by Trump’s trade war and now the pandemic, deserve a new reliable and local cash crop.