May 8, 2008

Contact:  Darlene Schlicher (615) 741-6336 or email:  darlene.schlicher@legislature.state.tn.us

State Senate passes key bills as General Assembly enters final legislative week

(NASHVILLE, TN, May 8, 2008) -- As the Tennessee Legislature prepared to enter the final week of the 105th General Assembly, state senators acted on a wide variety of important bills.  This action included the approval of the Senate Finance Committee on major legislation setting up a plan on how to spend excess lottery funds.  On the floor of the Senate, State Senators approved the actions of the House of Representatives and sent to the governor several key measures, including a major proposal to encourage the growth of health care cooperatives for small business.  Additionally, the State Senate passed a bill reforming the State Veterans Nursing Homes, and legislation expanding entities eligible to start a charter school to properly accredited private universities.  Those two measures will be among many legislative proposals still pending next week that will need approval in the House of Representatives before they are sent to the governor as the session comes to a close.

Governor gives preview of budget cuts

It is the state’s budget that will be the focus of the final days as the budget news continues to worsen.  Governor Phil Bredesen has announced he will need to reduce state government personnel by five percent, or 2011 jobs, to make up for $64 million of the $468 million that must be cut from the proposed 2008-09 budget.  The state will present a plan to buy out workers affected by the cuts in June.  If there are not enough of affected state employees who choose to participate in the buy-out, then the governor said jobs cuts would follow.

The $468 million cut is at the bottom of the $468 to $585 million range set by the state’s Funding Board last week as they revised their predictions on what Tennessee can expect in state revenues for the fiscal year, beginning in July.  The governor said if conditions deteriorated beyond the $468 range, the administration will make the necessary adjustments.   

The governor also placed on the chopping block his $25 million plan to expand pre-kindergarten programs.  In addition, he says he will propose a base reduction of $55 million for higher education and cut the $86.4 million for K-12 education needed for the second phase of our Basic Education Program (BEP) 2.0, which is the education spending reform passed last year.  Further, the governor cut a proposal calling for automatic revocation of drivers licenses (ALR) for drunk drivers upon arrest.  
 
The General Assembly will meet in joint session on Monday at 5:00 p.m. CST to hear the governor further outline his plan for budget cuts.  From there, the budget proposal will go to state lawmakers for their consideration, beginning in the Senate Finance Committee on Tuesday morning.  The Senate will have reached the 90th, or final, legislative day by Friday, pending any changes in the schedule.

Senate Finance Committee approves plan to provide more scholarship opportunities for Tennessee students with excess lottery funds

Approximately 13,254 students would receive more opportunities to receive lottery scholarship funds under legislation sponsored by Senate Education Chairman Jamie Woodson (R-Knoxville) and approved by the Senate Finance Committee.  The bill, which passed by a vote of 7 to 3, would extend the 2.75 GPA requirements for students to maintain the HOPE Scholarship through the end of their junior year.  It also provides scholarship opportunities to non-traditional students, military veterans and dependents, those who are dually enrolled in college and high school, and foster children.

Currently, there is $461.8 million in the lottery reserve account, of which $50 million must be kept in savings under current law.  The General Assembly also benefits from ongoing net revenues of an estimated $11.4 million more than is needed to continue the current programs funded by lottery proceeds.    

“I am very pleased that we have been able to put together a fiscally responsible package that will help over 13,000 students receive scholarship money,” said Woodson.  “We spent many hours looking at the best way to distribute these dollars to affect the most students and this plan meets the high standards we set out to achieve.  It by far impacts the most students with the dollars that we have available to us.”

The bill sets aside $349.5 million to create an interest bearing endowment fund, which together with the $11.4 million will fund all the proposals in the bill, including one for TSAA need-based grants.  TSAA is Tennessee’s primary need-based student assistance program.  Almost all of these students, or 90 percent, have family incomes below $30,000.  The endowment fund would provide $10 million to issue these grants. 

“The grants for non-traditional and need-based students are key provisions in this legislation,” Woodson explained.  “Tennessee's educational attainment ranking is 43rd in the nation.  We cannot catch up with the national average by serving traditional students alone.  We must reach out to non-traditional students, which will enable Tennessee to supply a workforce capable of attracting businesses and enhance economic development.” 

Some of the other highlights of the plan include:

• Continues funding of $25 million for Pre-K

• extends the 120 credit hour-limit to five years in order to accommodate any hours lost due to transfer, change of major, or majors requiring more than 120 hours of credit

• removes home school requirement of two years

• allows dependents of religious workers who are from the state but who are temporarily overseas to claim Tennessee for scholarship purposes

• gives students attending two-year institutions with housing the four-year award

• provides Civic Education Scholarships for exemplary students

• establishes a Laptop Pilot Program to help students access more online course opportunities

Senate Passes Reform of State Veterans Nursing Homes

The State Senate passed legislation this week, sponsored by Senate Republican Leader Mark Norris (R-Collierville), to reform the Tennessee Veterans Nursing Homes. The nursing homes have come under increasing state and federal scrutiny following recent allegations of abuse.  The bill, SB 3919, restructures the board, consolidates daily management responsibilities in a new executive committee, and provides for heightened accountability between board members and state government. 

Over the past two years, Norris has repeatedly challenged the Administration to reexamine the structure and investigate mismanagement of the homes. Admissions were temporarily suspended at Humboldt and Murfreesboro last year. 

“The treatment of some of these veterans has been intolerable,” said Norris. “Reforming the board is a necessary first step toward assuring the appropriate level of care.”

The bill requires appointment of two new members with clinical nursing home and administrative experience, and it makes the Commissioner of Finance and Administration a member of the Board. New reporting and legislative review requirements are also enacted.  

“The purpose of this bill is threefold,” added Norris.  “It embraces the need for a more traditional corporate structure with ample professional expertise while maintaining the current emphasis on a strong veteran presence.  It also redefines the board’s powers and duties in a way that makes it more accountable to the Governor and General Assembly and, most importantly, to Tennessee’s veterans and their families.  Third, by consolidating more responsibility for oversight of the daily operation of the homes in an executive committee, management will be strengthened to allow the board to focus on its broader mission of serving our veterans – our heroes.” 

The bill is pending action in the House of Representatives’ Budget Subcommittee of the Finance, Ways, and Means Committee.

Senate sends to governor legislation to provide affordable health insurance to small businesses

The Senate approved a minor amendment this week and sent to the governor legislation, sponsored by Senator Steve Southerland (R-Morristown), to let more small business owners join together to negotiate lower health insurance rates.  The bill, SB 4014, increases flexibility for those small business owners who may choose to form these pools by raising the threshold for small businesses eligible to participate from 25 to 50 eligible employees, with a two-employee minimum. 

“Affordable health insurance has been a top concern for many small businesses,” said Senator Southerland, Chairman of the Senate Commerce Committee.  “The lack of affordable health insurance hurts small-business owners, their families, and their employees.  This, in turn, also raises the cost to taxpayers because many individuals who lack health insurance visit an emergency room for treatment, which is more expensive than a physician visit.”

The legislation would define a health group cooperative as a private purchasing cooperative that contains at least 1,000 employees or that has a minimum of 10 participating employers.  Membership would be voluntary, but participants must commit to purchasing coverage of fully funded plans through the cooperative for five years to ensure pool stability.  A cooperative must operate as a nonprofit and must register and demonstrate compliance with the Department of Commerce and Insurance, under the bill.

"It is very important that we do everything we can in Tennessee to help our small businesses and their owners," Southerland added.  “By forming health group cooperatives, small businesses can spread their risk over a broader group to enhance their ability to get lower rates on insurance.”

A study conducted by the National Federation of Independent Business (NFIB) 15 years ago showed 75% of its members offered health insurance. Results of the same poll last year showed a drop to only 45% of members offering coverage, with businesses with the smaller number of employees being less likely to offer insurance.

Legislation authorizes properly accredited private universities to apply to operate public charter schools

The State Senate voted 26 to 5 to allow properly accredited private colleges and universities to apply through their local boards of education to operate a public charter school.  Currently, only public universities may make an application to sponsor the schools. 

Bill sponsor Senator Jim Tracy (R-Shelbyville) said the measure would give universities, like Vanderbilt, an opportunity to create “laboratories of learning” that can be used to foster new and innovative teaching methods.

Dr. Steven Ross at the Center for Research in Education Policy at the University of Memphis told state senators earlier this session that when states have very restrictive laws, public charter schools cannot be the laboratories of learning that they are supposed to be.  The concept of allowing schools the ability to use innovative teaching methods was one of the driving forces for adoption of Tennessee’s charter school law.
  
The bill, SB3283, is currently pending action in the House Calendar and Rules Committee.

Issues in Brief

Health Care / MRSA  -- Legislation, sponsored by Senator Raymond Finney (R-Maryville) that aims to reduce the spread of MRSA (methicillin-resistant Staphylococcus aureus) in Tennessee health care facilities and nursing homes has been approved by the full Senate.  MRSA is a strain of staph that is resistant to the broad-spectrum antibiotics commonly used to treat it.  The bill, SB 3667,  would require health care facilities that have infection programs to do a MRSA risk assessment and develop practices to try to reduce the infection.  It would also address the monitoring of these programs, particularly hand hygiene, which is considered an important method to guard against the spread of MRSA.  In addition, it develops communication protocols between facilities, like nursing homes, so that a receiving facility can take the appropriate precautions to contain any transfer of germs in infected patients.

Bible in Schools – The Senate voted 33 to 0 for a bill this week that allows the State Board of Education to develop a curriculum for an academic and nonsectarian study of the Bible.  Language was added to the bill ensuring that schools already using a Bible curriculum can continue their current program.  Another amendment on the bill, SB 4104,  allows school systems to adopt another system’s program, as long as it has been approved by the Board of Education.

Child Safety Training -- The Senate adopted an amendment and sent to the governor legislation, sponsored by Senator Jack Johnson (R-Franklin), to give parents more information and “a say” in personal safety instruction given to three, four, and five-year old children in child care centers across the state.  The bill, SB 3419, addresses curriculum to prevent sexual abuse provided by the State Department of Human Services that many child care centers feel is too graphic or inappropriate for children of that age. The legislation would allow centers to alter the curriculum, while still providing safety training.  It also requires notification be sent to parents of the children.

Auto theft – Legislation, sponsored by Senator Tim Burchett (R-Knoxville), which sets out to reduce auto theft in Tennessee, is now on its way to the governor after the Senate adopted a minor House amendment to the bill.  The legislation, SB 2858, would require scrap metal processors who purchase vehicles with the intention of dismantling or salvaging them to provide proof of ownership.  Any vehicle purchased that is over ten years old and which does not contain the motor or is inoperable would not require a title, but must have a written statement signed by the seller or their agent stating they have a lawful right to sell and dispose of the vehicle.  It also requires records on those transactions be kept for five years, including the name and address of the buyer, the amount they paid for the vehicle, date of sale, description of the auto, VIN number, and the license plate number of any vehicle transporting the automobile.

Juries – A bill that changes the way juries are selected in Tennessee has been approved by the full Senate on final consideration.  The legislation, sponsored by Senator Dewayne Bunch (R-Cleveland), represents the work product of a year-long committee composed of a wide group of members, from district attorneys to public defenders, and from clerks to the general public.  The purpose of the bill is two-fold.  First, the bill aims to make jury pools more representative of communities in Tennessee by removing exemptions currently in law.  The legislation, SB 3839, replaces them with “hardship exemptions” for those who would have a very difficult time serving, such as sole proprietors.  Secondly, the legislation assures local control of jury service.  Under the proposal, a person with a hardship would go to the local judge or jury commissioner in person, or by a note, letter, or call, to set forth the hardship who would then decide on the matter.  The bill does not effect those who are over 65 who would have the option of serving. 

Child safety / Background checks – The State Senate has approved legislation revising and clarifying a bill passed by the General Assembly last year that requires background checks for individuals who are doing business on school grounds.  The legislation, sponsored by Senate Education Committee Chairman Jamie Woodson (R-Knoxville), is a step to ensure that children are safe at these schools, and that those who are on campus when children are present are appropriately monitored.   Under the bill, SB 2807, subcontractors must have background checks performed on employees who will be on school grounds when children are present.  It also authorizes school subcontractors to receive the results of those background checks directly.  Further, it would allow for some transferability for these backgrounds checks to prevent repetitive checks.  The bill exempts employers who provide utility, governmental, or delivery services.  If an individual is hired for a school event and is under the supervision of the leadership of the school, then no check would be required.

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