Prospects Appear Good for Reform Bill in Tennessee

By Lonnie Harp — January 22, 1992 5 min read

Tennessee legislators, whose long hours in 1991 yielded only stalled education- and tax-reform efforts, last week began a special session that observers predict will at last produce a major new school-reform law.

Whether lawmakers will go along with Gov. Ned McWherter’s proposal to pay for the reform program by creating the state’s first income tax, however, remains in doubt.

By calling a 30-day special session dedicated to the reform plans, Governor McWherter preempted the regular 1992 session and put heavy pressure on lawmakers to approve an education bill before they can turn to other issues.

In addition, observers and state officials said last week, changes in the circumstances surrounding the issues should improve the chances for the Governor’s proposals this time around.

In the months since lawmakers finished their 1991 session, a state chancery-court judge has declared Tennessee’s school-finance system unconstitutional, while House and Senate lawmakers have ironed out differences in their versions of the education-reform bill.

The Democratic Governor also has met with his Republican predecessor, U.S. Secretary of Education Lamar Alexander, and with some revisions has turned Mr. McWherter’s “21st Century Schools” bill into the “Tennessee 2000" program, in hopes of winning wider Republican support.

‘Do Something for Education’

The past few months appear also to have shown lawmakers that many school systems will be severely damaged if the state has to follow last year’s pattern of budget cuts.

“There is a growing understanding of the need to do something for education,” said Cavit Cheshier, the executive secretary of the Tennessee Education Association. “I honestly think the special session will do something for education. How much, I cannot predict.”

Billy Stair, a chief aide to Mr. McWherter, agreed that the atmosphere of this year’s session should enhance prospects for the school-improvement package.

“In essence, it is not as unsettled as far as what might come out of the legislative process,"he said. “And in the event that the legislature does not act to respond to the court, we face the very real possibility of receiving a ruling similar to that which happened in Kentucky or Texas.”

The state has appealed the chancery-court ruling, but officials do not expect a decision by the state supreme court this year.

“There appears to be substantial support in the legislature for the Governor’s education proposal,” Mr. Stair said. “But there is still no consensus on how to pay for it.”

Income-Tax Problem

Mr. McWherter reintroduced his school-reform measure this year based on the results of the House-Senate conference committee. The bill calls for reduced class sizes in primary grades, revamped student assessments, and mandated kindergarten attendance.

On the one issue left unresolved by conferees--election of local school superintendents-the Governor included his controversial proposal to require that superintendents be appointed by elected school beards.

But if most questions on the reform plan have been settled, sentiments on new taxes to finance the plan remain very much up in the air.

Governor McWherter’s proposal would impose a 3 percent tax based on adjusted gross income, beginning in 1993. The tax would exempt the first $4,000 of personal income and would be combined with a number of tax-relief efforts, including a half-cent reduction in the state sales tax.

The Governor’s plan, which would also provide new funding for higher education, would generate an estimated $565 million in its first year for K-12 programs, rising to $718 million in its second year.

“This plan is simple, it’s fair, and it raises the money we mast invest in the education of our children,” Mr. McWherter said in unveiling the bill. “For just a few dollars a week, we can give every Tennessee child an equal chance for a quality education.”

The Governor’s message of a fairer tax burden, however, has not been well received in all quarters, especially among the legislature’s leading Republicans, who have vowed to resist any tax-increase efforts.

The chances of lawmakers’ approving an income tax is “zero,” according to Representative John G. Chiles Jr., the leader of the Republican minority in the House.

“It’s an income tax; that’s the problem,” Mr. Chiles argued. Observers noted, however, that , this year’s tax debate will not be as easily tabled as last year’s. Mr. McWherter has used the interim to build greater support within the business community, simplify the tax plan, and brief school officials and community leaders on what they stand to gain from his proposal.

“The legislature last year, by and large, just never faced the issue,” said Mr. Cheshier. “The people who have put the pencil to it have come to the same answer, and I am hearing legislators say, ‘I understand that there has got to be more money. I just can’t vote for it.’”

Convention Sought

In an effort to persuade some fence-sitters, the Governor has also proposed a bill calling for a 1994 constitutional convention to address tax-reform issues and the establishment of a state lottery.

The plan, which observers said stands a fair chance of passage, would ask voters in November if they are in favor of calling a convention.

If that referendum is approved, the convention would consider long-term issues of the state’s taxing structure and could revamp or abolish any income tax that lawmakers might approve in the special session. At the same time, if lawmakers once again dodge the income-tax issue, it could be revisited by the convention.

Voters would have to approve the actions of a constitutional convention.

Although a convention would provide another opportunity to debate tax issues, Mr. McWherter argues that lawmakers should not put off the school-finance debate once again.

“These are my recommendations for immediate tax reform,” he said in introducing his latest proposal. “Some Tennesseans may want more tax reform, some may want less, and some may agree with me that we should constitutionally cap the income tax.”

“These issues can be fully debated in the constitutional convention I am asking the General Assembly to call.” he added.

Mr. Cheshier said educators are encouraged by Mr. McWherter’s strategy in the reform debate’s second round.

“It is a very open approach and stance the Governor has taken,” Mr. Cheshier said. “He’s not trying to cram something down their throats.”

A version of this article appeared in the January 22, 1992 edition of Education Week as Prospects Appear Good for Reform Bill in Tennessee