New TACIR Data Site on Tracking the Impact of the Economy

TACIR has presented new information on the impact of the economy on Tennessee. This data is being presented in partnership with the Business and Economic Research Center at MTSU.

http://frank.mtsu.edu/~berc/tacir/tacir.html

Internet Usage Rates

The US Census Bureau provides statistics on overall internet usage nationwide. The chart (found here) breaks down broadband, dial-up and overall internet access for households by state. Unfortunately, Tennessee ranks low in the access of its citizens to internet generally and broadband. Based on 2007 figures, we have the 7th worst rate for internet access. The other low ranking states tend to be in the south (AL, AR, MS, LA), plus a couple of others like West Virginia and Oklahoma.

Tennessee Rail Projects Awarded $55.3 Million in Grants

Tennessee will receive $55.3 million in federal Transportation Investment Generating Economic Recovery (TIGER) discretionary grants for two rail projects in the state. The US DOT announced $1.5 billion in federal TIGER grant funds for more than 50 projects across the U.S. on Wednesday, the one year anniversary of the American Recovery and Reinvestment Act, which funds the competitive TIGER grants.

For more information, click
here.

TNInvestco Website

In 2009, the Tennessee General Assembly began working with ECD Commissioner Matt Kisber and Revenue Commissioner Reagan Farr to craft legislation designed to increase the flow of capital to innovative new companies in Tennessee in the early stages of development. Initially proposed as a template of CAPCO legislation adopted by other states, policy makers in Tennessee decided to take a different approach in seeding small businesses with the capital needed to bring a new idea to the broader marketplace and create jobs in the process.

The result was the TNInvestco program, which allocated $120 million dollars in tax credits to a cross section of venture capital funds with broad experience in developing new companies in Tennessee. Those funds would market the tax credits to insurance companies which would purchase the credits with capital reserves and the venture funds would use the capital to help Tennessee companies grow. Reporting requirements and audits by the Tennessee Office of the Comptroller were put in place to provide oversight.

The goals of the program are to develop the entrepreneurial infrastructure across the state, to attract new capital to Tennessee and to diversify the state’s economy and create jobs through the development of “innovation clusters” which result in new companies being spun off.

A new website has been launched by ECD to help provide more information about the program and how it may benefit economic development opportunities in your community. The website may be found at http://www.state.tn.us/ecd/tninvestco/.

Governor's Conference on Economic and Community Development

The 2010 Governor's Conference on Economic & Community Development will be held September 27-28 at Gaylord Opryland Resort & Convention Center in Nashville, Tenn. Hundreds of community leaders, economic development professionals, elected officials and business owners will convene to participate in informative sessions on high potential industries and positioning your community to attract development. Conference attendees will also have the opportunity to network with site selection consultants and learn best practices from other communities. Information on keynote speakers, session topics and registration will be available soon.

In the meantime, you may want to mark this date on your calendar.

National County Health Rankings

The Robert Wood Johnson Foundation and the University of Wisconsin Population Health Institute have released comprehensive national county health rankings. This is a first of its kind collection of 50 reports – one for each state - that evaluates the overall health of each county. When you drill down into the data, you get figures on everything from car accident rates, hospice use, high school graduation rates and liquor store density. The health ranking for your county and the data used to establish the ranking can be found here: here.

How Joblessness Transforms our Communities

The article linked below from the Atlantic is not for the faint of heart or the short of attention span. It is a long piece, examining many aspects of how extended and extensive joblessness impacts communities, generations, families and society.

Regardless of whether you agree with the author's perspective or conclusions, there are sobering indicators in the article that should be of concern to all of us, regardless of our personal economic condition.

http://www.theatlantic.com/doc/201003/jobless-america-future

Foreclosures in Tennessee

According to an article in the Memphis Business Journal (found here), Tennessee ranks No. 26 in the national for its overall foreclosure rate.

There were a total of 3,911 foreclosure filings in the Volunteer State in January, an increase of 6.8 percent compared to January 2009 but a decrease of 17.8 percent compared to the previous month, according to RealtyTrac Inc.’s U.S. Foreclosure Market Report. One in every 705 Tennessee homes received some type of foreclosure filing — default notices, scheduled auctions and bank repossessions — during the month. That ratio is lower than the national average of one in every 409 U.S. homes receiving a filing in January.

For more details, on the national trend, see this article from the AP on Tennessean.com.

State Tax Collections Update

The Department of Finance and Administration reports that Tennessee sales tax collections continue to be a concern for the state’s general fund. Negative growth in sales tax collections continued in January, with overall January revenues coming in at $947.4 million, which is $16.1 million less than the state budgeted.

“January is the 20th consecutive month in which sales taxes have recorded negative growth.” Finance and Administration Commissioner Dave Goetz said. “January collections represent December holiday sales, which brought reports of positive growth at the national level, so it’s very disappointing that we didn’t have a similar experience in Tennessee."

The general fund was under collected by $5.2 million and the four other funds were under collected by $10.9 million. Sales tax collections were $20.4 million less than the estimate for January. The January growth rate was negative 1.86%. For six months revenues are under collected by $159.0 million. The year-to-date growth rate for six months was negative 5.72%.

Franchise and excise taxes combined were $11.3 million above the budgeted estimate of $128.5 million. For six months revenues are over collected by $5.9 million.

Gasoline and motor fuel collections for January increased by 5.77 % but were $4.2 million below the budgeted estimate of $71.2 million. For six months revenues are under collected by $14.1 million.

Year-to-date collections for six months were $185.1 million less than the budgeted estimate. The general fund was under collected by $152.3 million and the four other funds were under collected by $32.8 million.

The budgeted revenue estimates for 2009-2010 are based on the State Funding Board’s consensus recommendation adopted by the first session of the 106th General Assembly in May of 2009, and are available on the state’s Web site at http//www.tn.gov/finance/bud/budget.html.

The State Funding Board met again on December 18, 2009 and adopted revised revenue ranges for 2009-2010. The revised ranges reflect growth rates ranging from -1.50 % to -0.25 % in total taxes, and -2.35 % to – 0.85% in general fund taxes.

Based on the funding board’s consensus recommendation, the official budgeted estimates for 2009-2010 were revised in late December. The revised estimates are reflected on pages A-70 and A-72 in the 2010-2011 Budget Document. The revised estimates assume an under collection in total taxes in the amount of $161.3 million, and an under collection of $153.2 million in the general fund.

Jobs Forecast Improving for Next Decade

According to an article in the Chattanooga Times-Free Press, Tennessee should begin emerging from a "lost decade" that saw the state lose 20,000 jobs over the course of the current decade. This was the first time since the great depression that the state experienced a net job loss over a decade. Economists from the University of Tennessee Center for Business and Economic Research project that the coming decade will see gains of almost 250,000 new jobs.

See the full article here.

Additional Cuts Proposed to State Department of Mental Health

According to an article from the Tennessean, the state Department of Mental Health and Developmental Disabilities will see additional cuts under the proposed state budget. Counties felt the impact of some of last year's cuts when the department adopted policies to begin billing local governments for some of the services provided by the department for mental health evaluations of misdemeanants. In addition, the potential backlogs at state mental health facilities create challenges for local law enforcement agencies that may be the point of first contact between the government and an individual suffering from mental illness.

For the full article, click here.

Recent TN Education Changes Appear in Line with Federal Reforms on the Way

According to an article from timesnews.net, the Federal government may be looking to set aside some of the elements of No Child Left Behind (NCLB) and replace them with new standards and priorities. From the description in the article, it sounds like many of the moves Tennessee has already taken (over the last couple of years and during the recent special session) are directly in line with the new federal proposals.

See the full article here.

Reminder - Energy Efficient Schools Grants Available

I have fielded a couple of questions recently about possible sources of revenue for retrofitting schools to cut down on utility costs. Included in Governor Bredesen's proposed budget is authorization for another round of Energy Efficient Schools Initiative grants and loans. This program is separate from Federal ARRA funding for energy efficiency improvements in government facilities that was available last year. The EESI program is funded from excess Tennessee lottery dollars and is designed to be a revolving program that can assist local school districts in improving the energy efficiency of K-12 school facilities through loans and grants.

For more information about the program, go to the EESI website here:

http://www.tn.gov/eesi/

Economic Development Education Grants Announced

Matt Kisber, commissioner of the Tennessee Department of Economic and Community Development announced a grant to the University of Tennessee Institute for Public Service (IPS) which will allow the organization to award $30,000 in Three-Star scholarships for city and county elected officials. The scholarships, overseen by the UT IPS and ECD, will be used for continued economic development education and 28 rural Tennessee counties and cities will be eligible to apply.

“This partnership between the University of Tennessee Institute for Public Service and ECD allows us to reach out to a group that is traditionally underserved,” ECD Commissioner Matt Kisber said. “It is imperative to further the education of our economic development professionals across the state. They will help create the higher-skilled, better-paying jobs of tomorrow.”

Grant recipients will receive the opportunity to participate in one or more of three training options provided by the UT IPS:

• The Tennessee Basic Economic Development Course, which focuses on fundamental concepts, tools and best practices needed to be successful in today’s economic development environment;
• The County Officials Certificate Training Program and Municipal Elected Officials Academy, nationally recognized training programs that provide specialized technical, administrative and managerial training to county government and municipal elected officials; and
• The Pioneer Academy, a joint city/county training program that educates attendees on economic development, planning and zoning, and retail economic development.

The Three-Star Scholarship Grants will accept applications from 28 rural Tennessee counties who have been determined to be undeserved in elected official training by the UT IPS Fiscal Year 2009 Training Data Report and by Economic Status of Tennessee as of July 1, 2009.

To see a list of these counties and to find out more information about applying for these scholarships, go to the ECD website here

For more information on applying for a Three-Star Scholarship Grant, please contact Beth Phillips, (865) 974-0268 or beth.phillips@tennessee.edu. All scholarships will be awarded no later than June 30, 2010.

Possible Impact of Census on Official's Salaries

Counties should begin thinking now about how the upcoming 2010 census could impact officials' salaries. The census process will begin in earnest over the next few months. For census years, April 1 is set as the formal date of the census. This has an impact on county official's salaries as minimum statutory salaries are set for county officials based on population classes. On an annual basis, county officials' minimum salaries are adjusted based on the percentage increase in compensation granted to state employees the prior year. As the state budget has tightened, state employee raises have been rare and therefore county officials' salaries have also seen few increases. After the census is complete however, a number of Tennessee counties will see population increases that move them up one or, in a small number of cases, two population classes and therefore trigger new minimum salaries for county officials. It is important to plan in advance and set aside funds for this purpose if you expect your county to move into a new class, because after the census is certified the salary increases will become retroactive back to April 1 of this year.

I will try to follow up with more information on this topic and a projection of those counties likely to move up a class in an upcoming newsletter. The staff at CTAS has already done some excellent work in this area to assist counties in planning for this budgetary increase and they brought this issue to my attention.

Governor Bredesen's Proposed Budget Resources On-line

A great deal of information about Governor Bredesen's proposed budget is available on-line. At the following website, http://www.tennesseeanytime.org/gov/state-of-the-state/, you can read a news release related to the state of the state address, read the full text of the address, link to archived video of the speech, view a 37 slide power point summary presentation of the 2010-2011 Proposed Budget and even access the full electronic verions of the 2010-2011 Proposed Budget. Be warned, the full budget document comes in two parts, with the larger document being over 670 pages long. In addition, from the link above you can access archived video of Governor Bredesen's Open Budget Hearings, which were held in November 2009 as the budget process began.

SCORE Summarizes Tennessee's Race to the Top Application

The Statewide Collaborative on Reforming Education has summarized the state's Race to the Top Application. As previously posted on this blog, the state's application was over 1,000 pages long. The six page SCORE summary can be seen here. For a link to the full application, see the posted below dated January 21st.

Comptroller Announces New Website with County Financial Info

Citizens can now look up financial information for most counties across Tennessee online, thanks to a new service that is being offered by the state Comptroller’s office. By visiting a page on the Comptroller’s web site, it is now easy to find detailed financial information about revenues and expenditures for 89 of the state’s 95 counties. The web address is: www.comptroller1.state.tn.us/TAG/

These 89 counties represent those audited by the county audit division of the Comptroller's office. Six counties are audited annually by private certified public accounting firms rather than the Comptroller’s office, so their financial information isn’t available on the site at this time. Those counties are: Davidson, Hamilton, Knox, McMinn, Shelby and Washington.

The information is compiled from the annual audit reports done by the Comptroller’s Division of County Audit. Jim Arnette, the division’s director, said revenue and expenditure data from the last four fiscal years is now available at the site, which is called Transparency and Accountability for Governments (TAG) in Tennessee. Arnette said several years’ worth of data will be kept available for access through the TAG Tennessee archives.

“We envision this as a tool citizens can use to keep up with what their local governments are doing,” Arnette said. “And local and state government officials should find it helpful to have easy access to this information as well.” The TAG Tennessee site includes information about school departments, but not other agencies, component units or enterprise funds that are accounted for separately from the counties’ main budgeted operations.

State of the State Address - Budget to Be Unveiled

Governor Bredesen will give his State of the State Address to a joint convention of the Tennessee General Assembly this evening. The address is expected to focus on the proposed budget, which will also be unveiled tonight. Many interested parties are nervous about the changes to come, with 6-9% cuts expected in many state departments and agencies. These cuts come on the heels of last year's cuts and cumulatively reflect over a 20% reduction in some departmental budgets.

Since many governmental functions are shared between state and local government levels (K-12 education, corrections, transportation, the court system, etc.) changes in the size and funding of state government impacts county government. The state shares certain streams of revenue with local governments, it reimburses local governments for some services they provide and it funds some operations jointly. Absent a groundbreaking piece of legislation, the state budget proposed tonight will probably have a greater impact on county government in Tennessee than any other individual piece of legislation considered and passed by the General Assembly this year.

Senate Bill Filling Deadline Passes

This year, breaking with its usual practice, the State Senate established a single bill filling deadline of January 28 (last Thursday). In the past, Senators had a period of unlimited filling before one deadline followed by a second period when each Senator was allowed to file only 9 more bills. Unless there is a backlog in the system due to the rush of bills at the deadline followed by the severe weather that hit Nashville the end of last week, it appears the Senate topped out at SB 3915 at the deadline. This reflects a little over 1500 new bills filed for this second year of the legislative session. Almost 2400 bills were filed in the first year. A few more bills will trickle in for private acts for individual cities and counties and it is possible a few bills can make it through the late bills committee. Still, the number is well below recent years.

The second year of a legislative session often has fewer bills since there are many left still pending from the first year, but usually it is not this significant of a reduction. The earlier filing deadline would have been a factor; but, the expected challenging budget has led many legislators not to even file legislation that comes with a significant price tag. This reduction in total number of bills filed reverses a trend that had seen bill fillings growing rapidly from session to session.

In the late 1990's and the earlier part of this decade, 2-year sessions of the General Assembly topped out between 3250 to 3550 bills. Totals fluctuated up and down within that narrow window. The 103rd General Assembly completed its work in 2004 with a total of 3529 Senate Bills. The 104th General Assembly upped the total to 4052; the 105th to 4280. With 2400 bills filed in the first year of this session, the 106th appeared poised to push that record further until this year.

Now the work of sorting through the impact of the legislation begins for legislative committees, staffers and organizations like this one.