Governor Bill Haslam had a big announcement for his State of the State address Monday night. He wants Tennessee to pay for the first two years of college. That’s for graduating high-school seniors heading to a community college or technical school.
Haslam has made a goal of ramping up the number of Tennesseans with college degrees. But tuition is often a major barrier. So Haslam is proposing a nearly $300 million endowment using money from the state’s lottery reserves.
“Net cost to the state: zero. Net impact on our future: priceless,” Haslam said to lengthy applause at the state capitol.
A few lawmakers have been trying to prod the state into doing something with the giant reserve fund that has accumulated through growth in lottery sales.
State Sen. Doug Overbey (R-Maryville) is one such legislator. He called Haslam’s idea “intriguing,” while cautioning the devil is in the details.
“I think the principal is sound, rather than simply leaving this block of money simply in a reserve account that is not being useful to students, to move it to an endowment,” he said.
A year ago, Senate Speaker Pro Tempore Bo Watson (R-Hixon) argued against tapping the lottery reserves. But Watson praised the governor’s proposal, while cautioning against overextending the reserve account, which would be left with just $110 million according to Haslam’s plan.
“I think that would be a good problem to have, if we have enough students who are using those resources to access college,” Watson said.
However, the proposal will be a tough sell for some lawmakers. It also tweaks current lottery scholarships, backloading the money. So the current scholarships would drop from $4,000 to $3,000 for the first two years of college. The amount goes up to $5,000 for the last two as a way to incentivize completion.
The proposed budget also includes more than $60 million for a new building at Vol State Community College and a new Williamson County campus for Columbia State.
Haslam spent most of his fourth State of the State speech on education, also defending some of his K-12 initiatives already underway.
The governor stood in the well of the state House and told lawmakers to back off of the new, more rigorous state standards they already adopted.
“Common core is about clearly defining common standards that students should know at certain grade levels. With all of the progress we’re making, how can we argue against higher standards?”
Some legislators have been pushing to roll back the math and reading standards now in use here and in almost every state.
Sen. Frank Niceley remains unswayed. He asks if Tennessee is making so much progress, why does it need new standards?
“I’m not a fan of Common Core. I don’t want to be common.”
Conservatives like Niceley cheered, however, when the governor briefly mentioned school “vouchers” by name. His limited proposal to pay private school tuition for low-income kids in low-performing schools was put off last year as some legislators wanted to expand the program.
Governor Haslam says he has money in his budget for the “focused approach” to vouchers. He also included funding for a two-percent raise for public school teachers, to make good on a goal of boosting teacher pay faster than any other state. While it’s not as much as teachers were expecting, it’s twice as much as the across-the-board raise proposed for state workers.
Health care is getting the short-end of the budget stick in Tennessee this year. While Haslam outlined plans to raise teacher pay, fund school vouchers and offer community college to all, the TennCare program will be paying for much of it.
The state’s Medicaid program now makes up 30 percent of the total state budget – a figure Governor Haslam feels is too high. So to drive costs down, he proposes to reduce what the program pays doctors and hospitals by one percent.
Tennessee Hospital Association president Craig Becker calls the cuts “disappointing.”
“It looks like we’re going to be cut to fund other programs, and on top of that, we’re not going to get expansion again this year, which really is a bitter pill for a lot of our hospitals to swallow.”
Hospitals have warned that some already-struggling facilities will go out of business unless more uninsured people are covered by TennCare.
Governor Haslam did spend a few paragraphs in his State of the State address on Medicaid expansion, but mostly defending why the state has yet to act.
“I believe that more Tennesseans having health care is good for our state. My concern has been that the federal government isn’t giving us the tools to do that in a cost-effective way or in a way that will ultimately impact the health of Tennesseans for the better.”
The federal government would fully fund TennCare expansion for three years and then pay 90 percent over time. Democrats estimate the state is losing out on more than $2 million a day.
Honoring Doug Henry
The longest round of applause Monday night didn’t come for a new proposal or a partisan punch line. The largely Republican audience jumped to their feet and clapped for 45 seconds to honor Nashville Democrat Doug Henry, who is retiring after 50 years.
“When he (Henry) came to the first one of these state of the state speeches, I was negative three years old,” Haslam said, veering off his prepared remarks.
Sen. Henry is the longest serving member in the history of the Tennessee General Assembly.
Blake Farmer co-wrote this report.