TCSA Capitol Update: March 6 - March 10, 2023

The General Assembly is entering crunch time as committees and subcommittees are trying to wrap up their work for the year in anticipation of focusing on the state budget. The Senate Energy, Agriculture and Natural Resources Committee has already closed, subject to the call of the chair. Several other committees have announced the date they intend to close or have at least set a deadline for members to put a bill on notice if they want it heard this year.

Transportation

After a close vote last week in Senate Transportation, the Governor’s Transportation Modernization Act of 2023 (HB321/SB273) had a quieter week. It was only heard in the House Government Operations committee, where the bill received a positive recommendation. It will face more critical votes next week in the finance committees. See the major article in this week’s newsletter for more details. 

Metro Nashville-Davidson County Council Slashed in Half

The bill to reduce the size of the metro council to 20 members not only passed the Senate on Thursday, it was rapidly prepared and transmitted to the Governor to sign. Governor Lee signed the bill (HB48/SB87) the same morning, a rare occurrence. As the bill makes significant changes to the metro general election taking place this upcoming August, the rapid signing will give the county more time to respond. However, it is widely expected Davidson County will file suit challenging the legislation. 

Development Taxes

 There was no public action on the legislation to authorize counties and cities to levy development taxes and impact fees, but there were plenty of conversations behind the scenes. Efforts are being made to limit (HB1206/SB820) to some form that can pass over serious opposition coming from realtors and homebuilders. The bill may be amended down to only apply in certain high growth areas. If you would like your county to have the option to use these tools to help manage demands on county services caused by growth, let your legislators know.

Annexation and Growth Plans

A bill (HB28/SB75) was presented this week in the Property and Planning Subcommittee and sent forward to the full House Local Government Committee. As introduced, the bill repeals all the provisions of 1998 Public Chapter 1101, known as the Comprehensive Growth Planning law. That act required all counties to create growth plans that included urban growth boundaries where municipalities could annex, plus planned growth areas where new cities could incorporate and rural areas where high density development was not expected to occur. This bill repeals all of those provisions. An amendment added in the subcommittee also amended provisions of the law that currently allow cities to exercise some extra-territorial planning and zoning in certain circumstances. The new sections added in the amendment would require there to be an interlocal agreement between counties and cities before that authority could be exercised by the city. The bill sponsor indicated it was his intent for counties to also have more of a say in municipal annexation decisions but it is not entirely clear how removing the boundaries will accomplish that. The bill is expected to be in the full House Local Government Committee next week.

Education

A bill progressed this week that proposes to codify Governor Lee’s stated goal of raising the minimum step of the salary schedule for teachers to $50,000. (SB281/HB329) would raise the schedule to $42,000 for the upcoming year, then to $44,500 in the following year, then $47,000, then $50,000 by the FY26-27 school year. A fiscal analysis on the amendment indicates that this would require $125 million in additional funds put into the base amount of TISA each year by the General Assembly and reserved for teacher salaries (that amount is included in the governor’s proposed budget this year). The analysis estimates that the additional funds would cover the cost of the mandated raises for all school districts in the first two years. Five school districts would have to provide a combined total of $106,142 in additional local funds in FY 25-26 and eight districts would have to provide $1.6 million in FY26-27. 

The bill that authorizes new types of charter schools generated more discussion and a lot of questions this week in the House Education Admin committee after coming out of subcommittee the previous week with no discussion. (HB1214/SB1194) proposes to create two new types of charter schools - one to oversee homeschool students and another type to create charter boarding schools. The state charter commission would be able to authorize either type of charter school without the consent of the local school district. Both are authorized to recruit students from anywhere in the state. The bill does not clarify whether local funds have to be provided to these new organizations and if so, which county would pay the local share - the student’s home county or the county where the charter facility is located. County associations have concerns over how these new types of charters would affect local funding and have discussed these issues with Chairman White, who has been presenting the bill. In committee this week, legislators also raised questions about where the additional revenue would come from to cover the costs of boarding students, since the bill prohibits the boarding school charter from charging tuition. Other legislators questioned whether the students in a homeschool charter would receive the full amount of funding under TISA or a pro-rated amount, since the student is only receiving three days of instruction per week. As the committee was running out of time and there weren’t clear answers to these many questions, the committee adjourned without taking a vote on the bill.

Another bill that would require school districts to make any excess space in a school building available to non-resident students moved out of the House K-12 Subcommittee this week. (HB959/SB973) was scheduled to be heard in the Senate Education committee this week, but was deferred until the final calendar of that committee. For high growth districts, requiring space in new or expanded schools to be made available to non-county resident students could create difficulties in managing the anticipated growth of in-county students.

Business Personal Property Taxes

A bill that would enact several recommendations from a TACIR study on business personal property tax began moving this week. Currently, some small businesses have the option of checking a box that they have less than $1,000 of property and paying a nominal tax. Companies with more property than that have to file detailed inventories with the assessor of property. (HB804/SB384) proposes to increase that level to $2000 and add a new step at $10,000. This would allow significantly more small businesses to take advantage of the simplified process, hopefully improve compliance, and free up the assessor to focus on larger businesses. This change in the law would be monitored by the Tennessee Advisory Commission on Intergovernmental Relations (TACIR). 

A bill (SB1034/HB1134) to improve the process of filing officials’ bonds at the start of their term moved forward this week. Every four years, county officials are  caught in a bit of a conundrum as the law technically makes it a crime for them to take official action before their bonds have been approved by the county commission. The term begins on September 1st, but in many cases the commission may not meet until two or three weeks later in the month. For many county officials, this has become a moot issue as the county uses insurance in lieu of bonds. For those still covered by a bond, this legislation directs that the bonds are approved by the county mayor, with the mayor’s bond approved by the general sessions judge. This hopefully creates a process to have the bonds in place prior to the start of the term so that the county is covered on day one. The county commission would still be able to require a higher bond amount if it chose to do so, but the bonds would begin covering the official without having to be first approved by a vote of the county commission.

Electronic Meetings

The proposal to allow electronic participation in local governing body meetings for certain limited purposes died in committee this week. After coming out of the Cities and Counties Subcommittee earlier in the session, the bill (HB389/SB294) was up for consideration this week in the House Local Government Committee. There was a new amendment offered to clarify that the county commission would have to opt into the bill before any of its members could use the provisions to participate in a meeting due to a family or medical emergency, military deployment or due to inclement weather. Some opponents of the measure attempted to send it to summer study. That motion failed on a voice vote, but then the subsequent motion to approve the legislation also failed on a voice vote. 

Electronic Monitoring Devices

A couple of bills are moving related to electronic monitoring devices. (HB794/SB855) is implementing some of the suggestions that came out of a task force last summer to stabilize the funding stream for the cost of providing these devices to indigent individuals. The current fund includes both ignition interlock devices for DUI offenders and other ankle bracelets, GPS tracking devices and transdermal devices. The increase in the types of devices being utilized has consistently depleted the funds available for covering the monitoring costs. The task force recommended separating interlock devices from the others and requiring judges to make a more detailed determination of indigency before authorizing the device to be paid for from the fund.

Also related to monitoring devices, (HB452/SB562) is headed to the House floor. This bill would require prisoners on work release to wear monitoring devices paid for by the employer of the inmate. This requirement does not apply to work crews which are under the supervision of law enforcement, like litter pickup crews, but it would apply to inmates on work release with a private employer. The bill has been referred to the State and Local Committee in the Senate but has not yet been heard there.

For a quick recap of this week's update, check out TCSA's Capitol Update on Youtube.