Education Funding

Tenn. Budget Crisis Is Lawmakers’ Pet Project

By Joetta L. Sack — June 19, 2002 3 min read

Tennessee’s budget may go to the dogs—or cats—depending on which legislators have their way this week.

Protesters express their views about the state budget in front of the Capitol in Nashville last month. With the July 1 start of the new fiscal year looming, Tennessee lawmakers are sparring over competing proposals to deal with a growing deficit. Two plans are dubbed DOGS and CATS.
—Photo by Mark Humphrey/AP

In what has become one of the nation’s most dramatic budget showdowns, lawmakers will debate whether to raise new taxes, including a first-ever statewide income tax, or make deep cuts in the state’s fiscal 2003 budget that surely would include reductions in education services.

Leaders met last week in closed sessions to study conflicting plans. The last day of the two-year legislative session is June 19.

The first plan is a governor-supported, flat 4.5 percent income tax that supporters say would sustain education funding levels. Then there is the “Downsizing Ongoing Government Services,” or DOGS, plan that would avoid new taxes but would likely lead to layoffs of thousands of teachers and force local districts to shoulder more education costs.

In a development later in the week, a bipartisan group of legislators also put forth the “Continuing Adequate (but not excessive) Taxes and Services,” or CATS, budget, which they say would maintain precollegiate and higher education funding without adopting a new income tax. It would, however, cut $500 million from other areas of the $19 billion state budget and “temporarily” raise taxes on businesses and alcohol.

Under the DOGS plan, lawmakers would cut about $400 million from the state’s $2.5 billion pre-K-12 budget. It’s a budget that already has seen numerous cuts in recent months. In addition, the state has largely flat-funded schools for the past several budget cycles, as the state struggled to manage a deepening budget hole.

Just how bad might things get?

Commissioner of Education Faye Taylor says the bite of the DOGS budget would be as bad as its bark. She contends that, if ratified, that plan would set public education back 20 years, eliminating strides that have been made in reducing class sizes and improving academic accountability.

“We’re not willing to unravel public education in this state,” she declared.

Tennessee has faced revenue shortfalls in recent years, but has squeaked by from year to year by relying on budget maneuvers and tobacco-settlement revenue. (“Education Funding Looms Large in Tenn. Budget Fight,” Aug. 8, 2001.)

Speaker’s Efforts

The income-tax proposal, pushed by Speaker of the House James O. Naifeh, a Democrat, was defeated by four votes in the House last month, and its future in the Senate is uncertain. Still, Mr. Naifeh believes he can rally enough support to pass a revamped version this month.

His plan would institute a flat 4.5 percent tax on income and reduce other taxes, eliminating the sales tax on groceries, prescription drugs, and clothing purchases of less than $500.

Gov. Don Sundquist, a two-term Republican who leaves office in January, supports the income-tax plan. In recent years, he has proposed and supported similar moves to revise the state’s tax structure, which currently has no income tax and relies heavily on sales taxes.

“We were already having hard times before hard times hit, and we’re going to have a hard time coming out of this if the state does not reform its tax structure,” said Alexia Levinson, Mr. Sundquist’s press secretary. The governor, who has been dubbed “Spendquist” by tax opponents, is adamantly opposed to the DOGS budget because that “would be devastating to K-12 and higher ed,” Ms. Levinson added.

Tax Conspiracy?

Tennessee’s tax fight spilled out of the aisles of the legislature.

A steady hoopla outside the Capitol in Nashville has pitted income-tax and other tax-overhaul advocates—who include many educators—against a staunch group of anti-tax protesters.

Some lawmakers and other citizens believe the state constitution bars a statewide income tax and argue that such a proposal would die in the courts.

One grassroots group, Tennessee Tax Revolt, contends that there is a conspiracy to force Tennesseans to pay income taxes.

The group contends that the state budget is not in such dire shape, and that pro-tax legislators crafted the DOGS budget as a scare tactic. Several gubernatorial candidates claim the budget can be managed without an income tax.

But the Tennessee School Boards Association believes schools will be shortchanged unless the tax system is overhauled, either through the income tax or some other new revenue source.

“We’ve got to prevent the cuts,” said Stephen Smith, the group’s director of government relations. “We’re terrified of the DOGS.”

Related Tags:

A version of this article appeared in the June 19, 2002 edition of Education Week as Tenn. Budget Crisis Is Lawmakers’ Pet Project

Events

Jobs The EdWeek Top School Jobs Virtual Career Fair
Find teaching jobs and other jobs in K-12 education at the EdWeek Top School Jobs virtual career fair.
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Mathematics Webinar
Engaging Young Students to Accelerate Math Learning
Join learning scientists and inspiring district leaders, for a timely panel discussion addressing a school district’s approach to doubling and tripling Math gains during Covid. What started as a goal to address learning gaps in
Content provided by Age of Learning & Digital Promise, Harlingen CISD
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Curriculum Webinar
How to Power Your Curriculum With Digital Books
Register for this can’t miss session looking at best practices for utilizing digital books to support their curriculum.
Content provided by OverDrive

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

Education Funding There Are Big Funding Gaps Affecting High-Poverty Schools. Can Biden Close Them?
Hurdles lie ahead for a $20 billion bid to create "Title I equity grants" to address long-standing funding inequities.
9 min read
President Joe Biden talks about the May jobs report from the Rehoboth Beach Convention Center in Rehoboth Beach, Del., Friday, June 4, 2021.
President Joe Biden made boosting Title I for disadvantaged students a key part of his education platform on the campaign trail.
Susan Walsh/AP
Education Funding Education Department Issues Directive on Shielding Students in Poverty From Funding Cuts
The agency released the "maintenance of equity" guidance on COVID-19 relief as part of a public-relations blitz on equity amid the pandemic.
5 min read
Image of a $100 dollar bill that is cut into blocks for distribution.
E+/Getty
Education Funding New COVID-19 Aid Coalition Highlights Strategies for Retaining Teachers, Digital Learning
The coalition representing school officials, teachers' unions, and others, has pledged a multiyear effort to use relief aid effectively.
2 min read
Mary Euell helps her sons, Michael Henry, left, and Mario Henry, work through math lessons remotely in their Erie, Pa., home.
Mary Euell helps her sons, Michael Henry, left, and Mario Henry, work through math lessons remotely in their Erie, Pa., home.
Christopher Millette/Erie Times-News via AP
Education Funding From Our Research Center Nation Earns a 'C' on School Finance, Reflecting Inconsistency in K-12 Funding and Equity
The Edweek Research Center's latest analysis finds a gulf in many states between per-pupil spending and how that K-12 money goes out.
6 min read
Illustration of C letter grade
Getty