Capitol Hill Week 2/26/2016

Pace quickens on Capitol Hill as Senate Committees continue to examine budget proposals and approve a wide variety of bills

The pace quickened on Capitol Hill this week as lawmakers considered a wide variety of bills and continued to review budget requests from departments and agencies of state governments. Senate committees have examined 35 of 53 proposed budgets from ¬¬¬ agencies and departments of state government since the budget was proposed by Governor Bill Haslam on February 1. The hearings are expected to be completed by mid-March as the budget proposal is generally one of the last bills to be considered by the General Assembly before adjournment.

Efficiency in Handgun Permitting Act overcomes first hurdle with approval by Senate Judiciary Committee

Among bills approved in Senate committees this week was the “Efficiency in Handgun Permitting Act” which aims to improve the process for gun owners and lowers the fee associated with obtaining a handgun carry permit. Senate Bill 2566 was given approval by the Senate Judiciary Committee and is part of a package of bills submitted to the legislature by Governor Bill Haslam. The legislation extends the current five-year handgun carry permit to eight years, lowers the initial handgun permit fee from $115 for five years to $100 for eight years and expands the renewal cycle from six months to eight years after the expiration of a permit before a person must reapply as a “new” applicant.

Under the proposal, background checks will continue to be conducted at the time of initial issuance and at the time of renewal. Additionally, an internal background check will be conducted in the fourth year of the eight-year permit without charge. It also gives a member of the armed forces, whose permit does not expire while deployed until two months after their return to Tennessee, the same eight-year period after expiration that a civilian has to renew a permit before having to reapply as a new applicant.

The bill now goes to the Senate Finance Committee for consideration before moving to the floor for a final vote.

Senate Revenue Subcommittee recommends seven Hall Income Tax relief bills to Finance, Ways and Means Committee

The Senate Revenue Subcommittee sent seven Hall Income Tax relief bills to the Finance Committee this week with recommendation for passage. The Hall Income Tax levies six percent on earnings from stocks and bonds, with 3/8 of the revenue going to cities and counties. Since enactment of the tax in 1929, the use of investment savings has grown as a primary source of retirement income making it less palatable as a source of revenue to many members of the General Assembly.

The bills passed by the Revenue Subcommittee include:
• Senate Bill 1440 which reduces the tax from six percent to five percent for taxpayers who are veterans with service connected disabilities;
• Senate Bill 1461 which decreases the tax from six percent to 5.5 percent for tax years beginning January 1, 2017;
• Senate Bill 1551 which raises the income level for taxpayers 65 years of age or older from 37,000 to $50,000 for single filers and $68,000 to $100,000 for joint filers;
• Senate Bill 2 which abolishes the state’s share of the tax, but holds local governments harmless;
• Senate Bill 2619 which repeals the tax, but allows local governments to continue collecting up to 2.25 percent;
• Senate Bill 2539 which establishes a “angel investor” tax credit against the Hall Tax to spur investment in early stage companies; and
• Senate Bill 839 which phases out the tax contingent upon revenue growth exceeding three percent in any fiscal year until it reaches zero percent.

The Subcommittee will hear four more bills providing Hall Tax relief next week. In addition, Senate Bill 47 was sent back to the Finance Committee by the sponsor this week to add an amendment. The legislation, which would begin the process of repealing the Hall Income Tax, had been pending final action on the Senate floor.

The Senate Finance Committee Chairman has said the full committee will consider all bills recommended by the subcommittee as members work on a comprehensive approach to Hall Tax relief this session.

Physical Education / Schools

The Senate Education Committee approved a bill this week which creates the Governor’s Three Star Physical Education (PE) and Literacy Pilot Program for students in grades three to five (SB 2001/Ketron).  The purpose of the pilot is to determine whether increasing PE and literacy courses in a student’s schedule for 30-45 minutes, four days a week, will increase growth in motor skills for the students as well as boost achievement and decrease behavioral incidents.  Under Senate Bill 2001, 18 elementary schools will be chosen, divided into two groups of nine schools.  One group will participate in the pilot and the other group will be the control group. The schools will be chosen with priority given to schools with a large concentration of students with a high body mass index (BMI), identified as low performing schools, or without a PE program.  Tennessee is the 47th worst state in the nation in obesity and is 49th for inactivity.

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