It took almost the entire day, but both the House and the Senate finally signed off on Gov. Bill Haslam's IMPROVE Act.
The bill passed the House by a 60 to 37 vote, and it passed the Senate 25 to 6. The House will now have to adopt the Senate's version or sort out the differences in conference committee before it can head to the governor's desk.
The bill will increase the gas tax by 6 cents and the diesel tax by 10 cents over the next three years, starting with a 4 cent increase on July 1. It will be the first increase in the state gas tax since 1989. Car registration fees will increase slightly, and electric vehicle owners will now have to pay a $100 annual fee. The estimated $350 million in new monies will help the Tennessee Department of Transportation address a $10 billion backlog in major road and bridge projects over the next decade. The bill also allows localities to hold referendums to pass local option sales or other tax increases to fund transit projects, something heavily lobbied for by Middle Tennessee mayors.
"This is a momentous day in Tennessee, as the General Assembly has voted to move our state forward on building the transportation infrastructure we need to remain competitive economically and improve the quality of life of our residents. I want to thank the entire Davidson County delegation for voting in support of [the bill]," said Nashville Mayor Megan Barry in a statement afterwards.
The legislation will also cut $113 million in franchise and excise taxes, cut the grocery tax by 20 percent, and it sets a timetable for enacting the Hall income tax cuts passed last year. An amendment adopted in the Senate but not the House would also provide property tax relief for veterans, the elderly and the disabled.
"This is the largest tax cut in Tennessee history," said Senate Majority Leader Mark Norris (R-Collierville) when presenting the bill on the floor. "There ought to be an acronym for it, the Mother of All Tax Cuts."
In statements after the votes, Haslam and Lt. Gov. Randy McNally (R-Oak Ridge) echoed Norris's language.
"The IMPROVE Act is the largest tax cut in Tennessee history, makes us more competitive as we're recruiting manufacturing jobs and keeps our transportation network safe, reliable and debt-free for the next generation of Tennesseans," Haslam said.
Governor Haslam's IMPROVE Act "Tax Cut Act of 2017" (HB 534), which includes a 6 cents per gallon gas tax increase and a 10 cents per gallon diesel tax increase phased in over three years, garnered 23 votes from Democrats and 37 establishment Republicans, which was more than sufficient to get it to pass in the Tennessee House of Representatives by a vote of 60 to 37 late Wednesday.
It was a long day for State Rep. Barry "Boss" Doss, the leading co-sponsor of the bill, who spent several hours presenting the case for the bill on the floor of the House prior to the final vote.
Only two Democrats, State Rep G. A. Hardaway (D-Memphis) and State Rep. John Mark Windle (D-Livingston), joined the conservative caucus of Republicans, who cast 35 votes against the IMPROVE Act "Tax Cut Act of 2017."
Rep. Hardaway was one of only two Democrats to vote against the Improve Act "Tax Cut Act of 2017."
Rumors swirled throughout the capitol Wednesday that Governor Haslam had made a deal with the Democrats to secure their votes.
Rep. Doss (R-Leoma) was seen conversing on the floor with several Democrats throughout the day, which was not, by itself, particularly unusual.
More significantly, Democratic Minority
Leader Craig Fitzhugh (D-Ripley) was seen accompanying administrative staffer Warren Wells to the capitol Tuesday afternoon.
As reported by The Tennessee Star, Leader Fitzhugh confirmed that Governor Haslam was told a $250 million education expenditure would gain Democrat support for the governor's gas tax increase proposal, a deal the Governor denied in a Wednesday morning telephone interview with WWTN's Ralph Bristol.
While the IMPROVE Act "Tax Cut Act of 2017" includes tax cuts, several Democrats have spoken passionately throughout the committee process and on the House floor Wednesday that not enough was being done for the poor, working poor and elderly and that the IMPROVE Act "Tax Cut Act of 2017" tax cuts go to the wealthiest of Tennesseans.
State Rep. Bo Mitchell (D-Nashville) made just such an impassioned plea on the floor of the House but ended up voting yes in favor of the Improve Act "Tax Cut Act of 2017."
VOTE ON THE "IMPROVE ACT" AMENDMENT: HB0534 by Casada - FLOOR VOTE: MOTION TO ADOPT AMENDMENT # 4 BY Sargent 4/19/2017
Passed
Ayes...............................................61
Noes...............................................35
VOTE ON THE "HAWK" AMENDMENT: HB0534 by Casada - FLOOR VOTE: MOTION TO ADOPT AMENDMENT # 5 BY Hawk PASSAGE ON THIRD CONSIDERATION 4/19/2017
Failed
Ayes...............................................38
Noes...............................................58
FINAL VOTE ON THE BILL, AS AMENDED: HB0534 by Casada - FLOOR VOTE: AS AMENDED PASSAGE ON THIRD CONSIDERATION 4/19/2017
Passed
Ayes...............................................60
Noes...............................................37
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Report: Tennessee 5th in nation for economic outlook
Lizzy Alfs , USA TODAY NETWORK
Tennessee 1:22 p.m. CT April 18, 2017
Tennessee climbed two spots to earn the title as one of the most economically competitive states in the country.
That's according to the American Legislative Exchange Council's annual "Rich States, Poor States" report, which ranks states' economic outlook based on 15 state legislative policies, including tax rates, state minimum wage and average workers' compensation costs.
Tennessee landed a spot in the top five for the first time since 2008. The Volunteer State was surpassed by North Dakota, North Carolina, Indiana and Utah as the most economically competitive states.
In 2016, Tennessee ranked No. 7 in the U.S.
"For the first time in the history of 'Rich States, Poor States,' Tennessee has successfully climbed into the top five in terms of economic competitiveness. This is largely due to the state's many responsible fiscal policies, including no personal income tax, the recent repeal of the Hall Tax, the recent repeal of the death tax and the state's right-to-work status," the report says.
The bottom five states were Connecticut, California, New Jersey, Vermont and New York.
Nashville Mayor Megan Barry Calls Passage of Gas Tax Hike 'A Momentous Day in Tennessee,' Looks Ahead to Mass Transit Plan
Nashville Mayor Megan Barry has been cheering Gov. Haslam's gas tax hike for road improvements, while keeping an eye ahead toward implementing a $6 billion transit plan.
Barry pushed for Gov. Haslam's IMPROVE Act, which includes the gas tax hike, in the hours leading up to Wednesday's action on the bill. The bill passed in both the House and Senate.
After the bill passed, Barry celebrated with this tweet:
"Our most immediate need is funding," said Barry, a Democrat, earlier this month in an interview with WSMV Channel 4.
The $6 billion transit plan, known as nMotion, was adopted last year by the board of directors of the Regional Transportation Authority. The RTA is made up of Middle Tennessee mayors and Haslam appointees. Their endorsement is nonbinding but gives the plan momentum. The proposal calls for the project to be phased in over 25 years. Funding sources are still on the drawing board but would likely include tax increases.
If former mayor Karl Dean's failed 2014 Amp rapid bus plan is any indication, Middle Tennesseans could be in for a protracted battle over the details as well as the costs of the large-scale nMotion transit proposal. AMP opponents fought hard for its defeat, deeming it an ill-conceived plan that would attract few new bus riders and would worsen traffic. The seven-mile bus route would have linked East Nashville to downtown to West End Avenue.
Nashville continues to boom, with 100 people moving to the area every day.
