NASHVILLE (AP) — Tennessee Gov. Bill Lee’s administration is proposing another $284 million in budget cuts next year due to the economic fallout from the coronavirus pandemic.
The Republican’s team said Thursday the cuts would be in addition to $397 million in recurring costs removed from the budget in March when the crisis was in its initial stages.
Finance Commissioner Butch Eley says officials are adjusting based on a revenue shortfall of up to $1.5 billion through the next budget year.
Multi-year cuts will include up to 12% reductions to departments; reductions to capital projects and capital maintenance funding; bonds for some capital projects; and a yet-to-be-fleshed-out employee buy-out initiative over the next two years.
The budget plan removes the remaining $58 million set aside for teacher pay raises. The governor had planned $117 million for the raises, then $58 million of that was cut in the virus-hampered budget update in March.
The $167.1 million in bonds would include already planned funding of $65 million in economic incentives for Amazon’s planned operations center in Nashville and $50 million for Volkswagen’s expected car production growth in Chattanooga.
Eley also told lawmakers a court decision would “effectively delay” Lee’s school voucher program for at least a year.
Earlier Thursday, the administration planned to reduce some money set aside for the first year of the program by $22 million, which would have brought the total down to about $16 million.
But the state Supreme Court later in the day effectively kept the voucher program from being implemented for the 2020-21 school year, since most schools will already be starting by August and a hearing is set in the state’s appeal on Aug. 5.
While Eley noted that the governor “is still committed to funding this program,” the funding that had been set aside for vouchers would “not be utilized this year.”