The Legislature's unprecedented failure to adopt a balanced budget by the start of the state's fiscal year on July 1 leaves Tennessee wallowing in a fiscal crisis the likes of which it's never seen before.
A stopgap funding measure adopted in desperation on June 29 averts a governmental meltdown for the next few weeks. Come Aug. 15, though, public school systems won't be getting $250 million in state funding expected on that date unless a source of revenue is established. And even in the meantime, UT (and other state universities) are at a loss on how to set tuition for the fall semester in the absence of any indication whether Gov. Don Sundquist's recommended increase in higher education funding will be forthcoming.
While an impasse has been looming for months on how to cover an $850 million deficit in Sundquist's budget, hopes rose early last week that a House-Senate conference committee might rise to the challenge of resolving it. That's when House Speaker Jimmy Naifeh dramatically informed the conferees that a majority in the 99-member House had been mustered for a sweeping tax reform plan that would generate about $700 million a year in new revenue.
The plan, sponsored by Rep. Ronnie Cole, D—Dyersburg, combined a two-bracket (4 percent/5 percent), high-exemption income tax with the elimination of sales taxes on groceries, clothing and non-prescription drugs. The 6-percent Hall income tax on dividends and interest would also be repealed, and a uniform statewide sales tax rate of 7 percent established.
The following Wednesday morning Naifeh kicked off the conference committee's proceedings with a speech so stirring that even customarily impassive journalists in the packed meeting room applauded. The accompanying excerpts from his speech attest that the ensuring debacle wasn't for lack of exemplary leadership in the House.
Unfortunately, as an old political adage goes: When you have the votes, you vote; and when you don't, you talk. Naifeh's speech was really directed at his Senate counterparts who have proven abjectly incapable of molding a majority for anything. Neither any form of income tax or sales tax package, nor any of the scores of other revenue-raising options considered by the conference committee has yet to gain the support of the 17 senators needed for adoption in the 33-member body. Yet at the same time very few of them favor cutting Sundquist's budgeted expenditures by much.
How on earth can the Senate have failed so abysmally for so long to find common ground, which is what the craft of politics is supposed to be all about? The answer starts, symbolically at least, with the doddering buffoon who passes for Naifeh's counterpart in the Senate. At 80, Senate Speaker John Wilder should perhaps be excused for his inanity due to age. But that's no excuse for the bipartisan coalition that keeps on re-electing him in the interest of preserving a spoils sharing system that would be likely to collapse with his demise.
The stark contrast between the House and Senate leadership was dramatized at the end of the very day that Naifeh had kicked off with such a bang. After hours of wheel-spinning during which the conference committee stood in recess, Wilder came to the podium and began by telling the reassembled conferees that, "Maybe I need to apologize...I tried to find 17 votes. I couldn't find 17 votes. We've been here a long time, and we're tired. Let's don't get mad. Let's get glad."
The only thing to be glad about is that Wilder also couldn't find 17 votes for the 3/4 cent increase in the state sales tax that the conference committee eventually recommended after the Cole tax reform plan had fallen by the wayside. For all the reasons stated so often in this column, a sales tax increase is the worst possible solution to the state's fiscal plight.
Many able members of the Senate know that full well. But up to now they have been too cross-purposed to come up with any other alternative. Maybe when the public schools face a shut-down and college students are facing prohibitive tuitions, the public will start demanding that the lawmakers get their act together.