published Tuesday, April 3rd, 2012

Gov. Haslam budget trims grocery tax, aids Tennessee jails

Other changes

• Restoring $1.4 million in funding for mental health peer support centers across the state.

• Inclusion of another $3.9 million to fund Healthy Start and health department programs for children previously slated for cuts.

• Restoring $250,000 in cuts to Child Advocacy Centers across the state, including a program in Hamilton County.

• Providing $5 million in state funds for Tennessee Career Centers to address the past practice of funding their annual operations with one-time federal dollars.

• Restoring $375,000 in cuts to the state's Poison Control Center.

• $250,000 to support the Amachi mentoring program for children of inmates through the Big Brothers Big Sisters organizations.

• $122,000 to fund legislation that requires jobless people on unemployment to verify their job search efforts.

NASHVILLE -- Gov. Bill Haslam announced Monday he is including a deeper cut in the state sales tax on groceries as part of an administration amendment to his proposed $30.2 billion spending plan for 2012-13.

The move is just one of at least $25 million worth of changes the Republican governor is making.

Others include boosting the state's daily payments to local jails for housing state felons from $35 to $37 per prisoner per day at a cost of $4 million annually. He also is restoring $3 million in funding to family resource centers, including one operated by Hamilton County Schools.

The centers use the funding to help lower-income students and their families with food, clothing, tutoring and other issues.

Meanwhile, Haslam also announced that he and the Tennessee State Employees Association have struck an agreement on his proposed changes to civil service laws that will make it easier to hire and fire state workers.

"I think everybody agreed that the system we had was broken," Haslam said of civil service requirements.

With regard to the budget, Haslam said he has added an extra $3.3 million to increase the sales tax cut, which originally was slated to drop from 5.5 percent to 5.3 percent. It will now fall to 5.25 percent beginning July 1.

Haslam said he plans to reduce the tax to 5 percent in the next budget.

He acknowledged the increase in local jail payments, the first in a decade, is intended to soften local government concerns about a provision in his anti-crime package. The provision requires domestic-violence offenders to serve a year in jail on third and subsequent convictions.

The provision has concerned local governments, which would see their costs increase about $8.4 million statewide.

Haslam's amendment is a nod to some of the recent growth in state revenue collections, which has led to pressure from Democrats, some majority Republicans and social-service advocates to restore a number of proposed cuts.

Tennessee tax collections during the first seven months of the year have outpaced original estimates by $237 million in the state's general fund, which pays for most government functions. All but about $30 million of that already was accounted for in Haslam's original budget, unveiled in February, administration officials said last month.

Haslam's original budget restored more than $100 million of $160 million in cuts to "core services" identified by former Gov. Phil Bredesen, who provided two years worth of one-time funding. The purpose was to allow Bredesen's successor and lawmakers to decide what cuts they wanted to make as the economy continues recovering from the 2008 recession.

Haslam said he had about $30 million to "play with" and make changes. The administration received budget requests of some $600 million, he noted.

The governor said of the civil service bill that the state employees association told administration officials that with some further "minor adjustments," they could support the overhaul.

He said the changes were "minor."

TSEA Executive Director Bob O'Connell said "what we have is an agreement for a better bill."

Last week, Democratic legislative leaders boycotted their weekly meeting with Haslam and Republican leaders after an agreement they thought had been reached with Haslam aide Mark Cate later was opposed in committee by Haslam's legal counsel, Herbert Slatery.

O'Connell said state employees are the first to admit the current system has problems. But he said Haslam's insistence that job performance evaluations be the sole factor in determining layoffs was a no go for employees, who now receive preferential treatment for seniority.

The compromise keeps performance as the top consideration but also requires officials to take into consideration seniority, disciplinary records and "ability." Several other changes also were made, including having state employee input on new evaluations.

Another provision requires Haslam's proposed 2.5 percent pay increase for employees to be across the board, and employees with disciplinary marks get the raise, as well.

The legislation still does away with "bump and retreat" requirements that mandate the state allow employees with the most years of service to "bump" employees with less seniority out of their positions during layoffs.

Contact staff writer Andy Sher at asher@timesfreepress.com or 615-255-0550.

about Andy Sher...

Andy Sher is a Nashville-based staff writer covering Tennessee state government and politics for the Times Free Press. A Washington correspondent from 1999-2005 for the Times Free Press, Andy previously headed up state Capitol coverage for The Chattanooga Times, worked as a state Capitol reporter for The Nashville Banner and was a contributor to The Tennessee Journal, among other publications. Andy worked for 17 years at The Chattanooga Times covering police, health care, county government, ...

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