The Tennessee General Assembly returned this week from March’s recess to finish up Legislative Session. During the break, TSEA has been monitoring activity and staying in contact with the administration and legislature to advocate for state employees and learn the long-term impact of COVID-19 on Tennessee’s economy and state workers.
Earlier this week, Gov. Bill Lee’s administration asked all state departments to identify and plan to cut up to 12 percent of their budgets. These department budget reductions would be implemented by July 1.
Finance and Administration Commissioner Butch Eley stated in his presentation to the Senate Finance Committee that the administration is looking at closing out the current fiscal year by focusing on a shortfall of roughly $500 million. But economists project revenue shortfalls ranging from $231 million to $700 million this year and between $582 million and $1.5 billion in the next fiscal year.
Click here to view Commissioner Eley’s entire presentation to the Senate Finance Committee.
In the long term, the state could potentially run a budget deficit over a few years, so all budget cuts would not need to happen at once, softening the impact. Gaps in the budget would be filled by implementing hiring and purchasing freezes, using non-recurring revenue, agency budget cuts, and tapping the state reserves.
A firm commitment was given to fully fund the state’s portion of the state group insurance plan and Tennessee Consolidated Retirement System funds. These two appropriations for state employees require a commitment from the administration and General Assembly of over $100 million.
TSEA will continue to lobby for the Pay-4-Performance fund for January raises to remain in the budget, but it is important to note that nothing is off the table at this time.
Unfortunately, with deficits, there could also be further program cuts and possibly a reduction in force (RIF). At the moment, no one has mentioned a reduction in force. Still, TSEA wants you to be mindful and plan for a worst-case scenario due to the unprecedented times we now live in with the coronavirus pandemic and its impact on our economy.
If a position is recommended as part of a RIF, one of the initial deciding factors in choosing which employee would be affected is the performance evaluation score on file. The agency shall consider other factors after the performance evaluation: 1) seniority, 2) abilities, and 3) disciplinary record (TCA 8-30-314(e)). Also, if you are in an interim position or currently on probation, please be aware that you may be vulnerable if a RIF is required.
When the legislature shut down in March, many TSEA bills that were working their way through the committee system were placed on hold. This fate was the case for every bill that wasn’t deemed mission-critical before convening session.
The TN House of Representatives is currently taking up every bill on their calendar when they recessed. Yesterday, the House of Representatives Full State Government Committee passed our match on 401(k) under the guidance of our dedicated sponsor Chairman Gary Hicks (Rogersville). This bill, if passed, will put in statute the requirement to match the 401(k) with $50. Currently, the law only requires the match to be a minimum of $40. We anticipate the bill being on the House Floor next week, the week of June 1.
In the Senate, Senator Briggs passed our 401(k) bill out of the State and Local Government Committee in early March. We expect that bill to be heard on the Senate floor in the coming weeks.
TSEA has worked very hard over the last few years at the legislature to raise the profile of state employees. We believe our efforts, combined with the essential work of state employees, have helped both the House and Senate justify consideration of both our Burden of Proof and 401(k) bills. It is important to note that our two bills are part of only a few bills outside of mission-critical and COVID-19 under consideration in the Senate.
We are grateful to all of the General Assembly members for standing with employees and acknowledging the great work of state employees over the last few months in service to the State of Tennessee.
As the legislative works toward wrapping up session for the final time this year, please continue to monitor your email and the TSEA website for important updates.
Thank you for being a member of TSEA.
