Posted on 05/22/2002 4:50:30 AM PDT by GailA
Tennessee House speaker may call for vote on income tax
By TIM WHALEY
Tennessee House Speaker Jimmy Naifeh, D-Covington, may well ask for a House floor vote Wednesday on his 4.5 percent flat income tax plan after a leading alternative, a 6 percent expanded sales tax, was pulled from further consideration Tuesday.
But skepticism remains that any plan will make it out of the House, much less through the Senate.
The sales tax expansion bill - co-sponsored by Reps. Bob McKee, R-Athens, and Chris Newton, R-Cleveland - ran into trouble last week when a re-statement of estimated tax collections under the plan moved the revenue generated down to $966 million, even if the sales tax rate was left at 6 percent.
A number of supporters said they could vote for the plan - which would tax professional, construction and personal services as well as a number of exempt items - if it lowered the overall sales tax rate to at least 5.5 percent.
To answer those who must have a rate reduction, the measure would drop to 5.5 percent in fiscal 2004, but that would only bring in about $758 million.
Some supporters, such as Rep. Steve Godsey, R-Blountville, backed off the bill when the rate wasn't reduced.
"I feel like $750 million is plenty to fund next year's budget on a continuation basis," Godsey said. "The economy is just turning around, so I think that's plenty."
The McKee-Newton plan was said to be the plan most favored by House Republicans, and Godsey said it remains to be seen if those votes are now completely off the table.
"It can be brought back up if enough support is found later at 5.5 percent," Godsey said. "So we may see it again later."
But Newton noted that some supporters also want to come closer to the full $1.4 billion budget proposal offered by Gov. Don Sundquist.
McKee and Newton said late last week they would not try to move the bill out of the House Calendar Committee if they didn't have the 50 votes for passage. Tuesday they shelved the bill, although it could be brought back later.
They told the Associated Press they had 40 votes.
Rep. Ken Givens, D-Rogersville, an outspoken income tax supporter, said he doubted if the measure would even gather 30 votes.
"I definitely question the depth of support for that plan," Givens said. "It's easy to say you will vote for something in the abstract if you'll never really have to vote on it.
"And this thing, it's just a tax on the expenses of Main Street businesses. I think the bottom line is members are still looking for someplace to hide."
As for the income tax, Givens said only Naifeh knows for sure, adding that it's difficult to tell the speaker one thing and vote another way when the time comes.
"Only Jimmy knows the vote count," Givens said. "It could be tomorrow or two or three weeks from now."
But some also question support for the income tax.
"I think (the income tax) is still stuck at about 46 votes, but we'll see," Rep. Keith Westmoreland, R-Kingsport, said.
For his part, Westmoreland said he's ready to vote for anything that will pull the state out of its deepening crisis.
"If something can get to the floor, we've got to do it," Westmoreland said. "There are three plans left standing right now - the 4.5 percent flat income tax, the services tax, and the plan I have (taxing income and services at 3.5 percent).
"Whichever one of the plans makes it to the floor, people who are responsible are going to have to vote for something to try to get the state back on an even keel. I am ready, willing and able to try to get it done."
Even if a plan does manage 50 House votes, Westmoreland said the Senate situation remains uncertain.
Some senators say there are no more than 13 solid income tax votes, others say 16, but the big question is who would be willing to become the crucial 17th senator needed to pass that plan.
"I'm just not sure they have enough votes over there to pass anything out of there," Westmoreland said. "They have been reluctant to show anything or pass anything, other than the temporary sales tax increase, which they knew was going to die in the House.
"So they are playing games with us, and it appears the Senate is going to win."
In the end, Westmoreland said inaction will mean enactment of the so-called DOGS (Downsizing Ongoing Government Services) budget by default.
"If we do nothing, it wins," Westmoreland said. "I don't think anybody in their right mind wants to cut the state budget by $800 million. ... I'm sure local governments don't want us to because that will come back and hit counties and cities hard. They will have to cut or raise property taxes because of cuts in education and other areas. So all of those local governments are waiting to see what we do, too."
PHONE NUMBERS 800-449-8366 or 615-741-3011
Lt Gov Wilder should be called besides your own Sen or Rep. If you have been redistricted be sure you call both sets of them. WESTMORELAND is turning traitor to the Reagan way.
Anti-tax troops, a message from General Valentine:
Dear FOP: (Friends of Phil) Like Japanese Zeros swooping down on a battleship, the pro-income taxers are coming at us again tomorrow(Wednesday). We will begin our broadcast at 10AM when the House goes into session.
If you're planning on being down there with our morning show with Mark Shannon, make sure you stay until at least 10AM. Last week we were diluted somewhat from 5AM until 4PM to the point that Sundquist pointed out that the crowd was smaller than last year so the income tax must be gaining in support. We have to focus like a laser on the time they're in session. That will be from 10AM until probably 2 or 3PM. If you can get out and join us on the sidewalk, all the better. If you can only come by and honk, that's fine, too.
In the meantime, call your state rep and senator and let them know how you feel. Please be nice and polite. You can find your rep by going to http://PhilValentine.com and look under TN Tax Central.
Let's rally the troops and defeat the income tax one more time.
We've come too far to lose now. See ya tomorrow!
Regards,
Phil Valentine NewsRadio 1510WLAC
......................................... Anti-tax Rally Wednesday May 22 at Legislative Plaza
The income tax may be closer to reality than ever, and Speaker Jimmy Nafeih may push it to a vote TOMORROW. If he gets 50 votes in the House, the Senate can pass it tomorrow afternoon with 17 votes.
The good news is that the people can still WIN, and keep more of our money from the tax and spenders IF we turn out in large numbers throughout the day tomorrow to turn up the heat on the legislators who are receiving pressure to vote YES on an income tax.
Bring your family, your friends, neighbors, coworkers and anybody else you can find to Legislative Plaza, at the base of the State Capital Building, Wednesday beginning at 5:30 am. The House meets at 10 am and the Senate at 1 pm. Homemade signs, flags, horns and bells are welcome!
Spread the word and stop the income tax. You can stay tuned for details throughout the day on 99.7 fm WWTN.
Steve Gill 99.7 WTN
The Knox News Sentinel
By Paula Wade, The Commercial Appeal
May 22, 2002
NASHVILLE - House Speaker Jimmy Naifeh, D-Covington, prepared to bring his 4.5 percent income tax plan to a full House vote today, adding modest tax hikes on alcohol and cigarettes and meeting with wavering House colleagues to corral the 50 votes needed for passage.
Tax protesters, egged on by anti-tax talk radio hosts, are expected to converge on Capitol Hill this morning as House leaders do a final vote count to see if the measure can pass. Radio talk show hosts have promised to broadcast from the Legislative Plaza all day to spur on the protest.
State officials have beefed up security throughout the Capitol complex.
Naifeh has pledged that he will bring the measure to a full House floor vote whenever he detects that it can pass, and spent most of the day Tuesday trying to shore up House votes. On the Senate side, leaders were counting votes to see whether Naifeh's bill could garner the 17-vote majority needed for passage there, breaking Capitol Hill's four-year logjam on taxes.
Naifeh's plan imposes a temporary 1-cent sales tax increase from July 1 to Dec. 31, which would expire and would be replaced by a 4.5 percent flat tax on adjusted gross incomes. For single taxpayers, the first $15,000 of income would be exempt. Married couples would have a $30,000 exemption, with a $1,500 deduction for dependents. The plan removes all sales taxes from grocery food, clothing and non-prescription drugs, eliminates the Hall Tax on investment income, but includes half of taxpayers' capital gains as taxable income. MY NOTE THIS IS AN OUT AND OUT LIE. SALES TAX ONLY COMES OFF CERTAIN FOOD, CERTAIN CLOTHES, AND CERTAIN NON-PRESCRIPTION DRUGS, THE HALLS INCOME TAX IS JUST BEING LOWERED TO 4.5% AND THE CAP GAINS IS A NEW TAX)
Rep. Tommy Head, D-Clarksville, a leading advocate for income tax-based reform, confirmed that the bill also is likely to include a 7-cent increase in cigarettes, from 13 cents per pack to 20 cents, and a 10 percent increase in taxes on alcohol. Those additions are aimed at gaining the support of lawmakers who favor "sin'' taxes, without being so high as to lose votes from lawmakers representing tobacco-farming regions. The additions also raise about $42 million.
Naifeh and Head also were considering adding a "sales tax holiday'' to the bill, declaring that purchases of clothing and other items be exempt from sales tax during a three-day period in July, in time for back-to-school shopping. "There are about 44 or 45 that we don't even have to ask. We know they're there. Then there are another 5 to 10 people you've got to make sure of,'' said Head. "We're not twisting arms, we're on our hands and knees begging.''
Meanwhile, the most likely alternative to Naifeh's plan - a controversial Republican-backed sales tax on services - was shelved Tuesday, with sponsor Rep. Bob McKee, R-Athens, admitting that it did not have enough support to pass.
"There doesn't seem to be enough interest in it to pass it on the floor,'' McKee told the House Calendar Committee. The services tax measure is still alive, however, and may serve as a fallback if Naifeh's proposal fails in the House or Senate.
"We don't know what will happen tomorrow, in the House or in the Senate,'' said services tax co-sponsor Chris Newton, R-Cleveland. "It's alive and could come back.''
Tennessee is facing a $490 million shortfall in the current fiscal year, and is short $1.4 billion in funding for next year's proposed budget.
Meanwhile, members of the legislature's Black Caucus on Tuesday said they are not linking their votes on tax reform to the dispute over black representation on the Tennessee Regulatory Authority or to any other issue.
"This issue is much bigger than the TRA, it's much bigger than anything this General Assembly will vote on and may be the most important thing any of us will vote on,'' said Rep. Kathryn Bowers, D-Memphis. Bowers had told reporters previously that the 14-member caucus was "not ready'' to discuss the tax issue until they could assure black representation on the three-member TRA, which regulates telecommunications.
Bowers held a press conference Tuesday to announce that she was ready to vote for Naifeh's plan despite the fact that it includes the temporary one-cent sales tax hike. Bowers, like many House members in border communities, has vehemently opposed a sales tax increase, and fears that she'll have trouble convincing constituents that this one won't be made permanent later, as other "temporary'' hikes have.
"I think it's creating problems for a number of lawmakers who've said they won't vote for a sales tax because it is a regressive tax,'' said Bowers. "But I think we all understand that the state needs to have some revenue to bridge the gap until an income tax can take effect.''
Rep. Henri Brooks, D-Memphis, a longtime supporter of tax reform, said she wants to read the newest version of the bill - the one still unfinished late Tuesday - to make sure that its sales tax "bridge'' increase really expires December 31 before next year's General Assembly even has a chance to extend it. "I need to make sure that it goes away completely and can't become permanent,'' said Brooks.
IN OTHER WORDS THEY ARE VOTING ON A VERBAL BILL! IS THIS LEGAL? IS IT CONSITUTIONAL? Paula Wade may be reached at 615-242-2018 or wade@gomemphis.com.
6:56:36 AM Wednesday, May 22, 2002
Sundquist Legislators need courage
By JOHN BRANNON
Messenger Staff Reporter
In the battleground of state budget woes, Democrat Phil Bredesen and Republican Van Hilleary are straw soldiers with swords of ice.
"It's easy to be against something and look at the polls and say, 'This is what I am, based on poll numbers,'" said Gov. Don Sundquist.
"But when you're sitting in the governor's chair, you have to come up with real answers. The buck does stop here. Neither of those two men has shown any political courage in terms of trying to do what's right."
Bredesen and Hilleary are considered the front runners in the current political race for Tennessee's next governor. Sundquist, now in his second and last term, has less than eight months left in office.
"It has been my honor and privilege to serve this state two terms," Sundquist said. "It's something that not many people have an opportunity to do. It still hasn't hit me that I'm leaving. We haven't slacked off at all. We're working harder than we did any other time. This is a great state."
During a one-on-one interview at his Nashville office May 16, Sundquist discussed several issues with this reporter.
"Hilleary, who has said there's not a problem, will have to acknowledge there is a problem," Sundquist said. "Bredesen, who has said he can manage his way out, will have to understand he can't manage his way out."
The state Legislature -- also known as the General Assembly -- is still in session. Each year, its primary task is to comply with the state constitution and pass a balanced budget. Its immediate task: Pass a budget for fiscal year 2002-03 which begins July 1.
Tennessee faces a $480 million deficit in the current budget, and it needs about $800 million in new revenue to fund the same budget again next year. Estimates are that it would take about $1.4 billion to fully fund Gov. Don Sundquist's proposed $9.6 billion budget proposal for the year beginning July 1.
Sundquist supports a bill sponsored by House Speaker Jimmy Naifeh of Covington. Naifeh's plan is for a 4.5 percent flat rate income tax. According to The Associated Press, it has exemption levels of $15,000 per taxpayer ($30,000 filing jointly) and $1,500 per dependent.
It also eliminates the Hall Income Tax on interest and dividend income, treating that income like any other. It would tax 50 percent of capital gains.
Naifeh's plan would generate about $1.4 billion in revenue for the state.
The Naifeh bill has yet to reach the House floor for a vote.
Given that scenario, what are the odds of the Legislature passing tax reform this session?
"There's a 50-percent chance we'll pass it, and a 50-percent chance we won't," Sundquist said.
Even to have reached the 50-50 mark means "an improvement over last year."
What's it going to take to pass true tax reform this session? Courage.
"It's going to take 50 in the House with courage and 17 in the Senate who have courage," Sundquist said.
Those are the numbers of votes necessary for any bill to pass by simple majority vote.
"I think Speaker Naifeh's courage and leadership ought to be commended," Sundquist said. "If it's possible to pass it, he'll pass it. People of courage who have staked out a position and arrived at it intellectually, for the most part, have had little or no opposition. That tells me if you do what's right, you're going to be re-elected.
"I think we're moving toward a time when people who are trying to find political solutions that will be safe are going to find that if you're dealing with the polls only, it's going to backfire. Polls change. People (legislators) are going to be held responsible for their lack of courage and not doing what's right for the people of Tennessee."
And if the Legislature does not pass tax reform this session? What then? Disaster for the state of Tennessee, Sundquist said.
"The General Assembly will have to pass a get-by budget, maybe a one-cent sales tax increase, to get us by another year," he said. "I think there's a broad feeling in the General Assembly that if they do pass a one-cent sales tax, it'll be temporary and will probably expire June 30, 2003."
A state sales tax of 6 percent, coupled with an add-on of 2.75 percent by local governments, means Tennessee consumers pay a whopping 8.75 percent sales tax. A one-cent increase would push it to 9.75 percent -- practically 10 cents on the dollar.
Sundquist said the prospect of the Legislature passing a one-cent sales tax increase is bound to be Bredesen's and Hilleary's worst fear.
"They're going to have to figure out a solution. Neither of them has come up with a solution. And that's a frustration to many in the House and Senate," Sundquist said.
"If you want to run for office, you have to be a leader. You have to assume some responsibility for your actions. I have no sympathy for those people who are afraid for their political lives, unwilling to make any kind of decision. I have great respect for those who make the tough decisions, Democrats or Republicans."
Sundquist said it's his belief that if tax reform is not passed this year, it'll be several years before it will be passed. The budget, he said, will be a patchwork of "taxes here and tax increases there."
"Our children are going to pay for it, too," he said. "We are going to price our children out of going to college. We've already got professors leaving the state. While being last or next to last in taxes, we'll be last in everything else. All of us, including Gov. (Ned) McWher-ter, Gov. (Lamar) Alexander, Gov. (Winfield) Dunn, and others who have come into this office trying to charter a path to progress, all will be to no avail."
And what will it do to Tennessee's bond rating?
"It will put us in the junk bond rating. We're close to it already," Sundquist said. "We don't need that. When that happens, I think you'll see the public rise up and say, 'Why didn't they do something?' Some of the same people out here who have said we don't need tax reform will be some of the same ones making criticisms about why we didn't do something."
And the tax protesters lately demonstrating at Legislative Plaza as well as those who disrupted the Legislature last July are...well, ignorant.
"I consider the source," he said. "People who are thinking people, people who value the lives of their children, people who have some basic understanding of how government works, (they) understand.
"There are a lot of people in this state who are reasonable, whom we may have disagreements with. But those who stoop to name calling, it's just ignorance. There's no other word for it. Just ignorance."
And what the Nashville talk show hosts do when they get on the airwaves and encourage the demonstrators is "close to ignorance," he added.
They are identified as Phil Valentine of WLAC, an AM station, and Steve Gill of WWTN, an FM station.
"They're selling their souls for radio ratings," he said. "They know better, both of them. Phil Valentine and Steve Gill know better. It's just a way of trying to make more money and have ratings."
Why exactly do we need "leaders" in public office? For the most part,all a politician does is steal money from one group of people,so that he can give it to another group of people,and assure his re-election. If this is leadership,I,for one,want no part of it-not as a leader,and not as one of the led. We don't need leadership nearly as badly as we need sober,thoughtful administration of public funds,by administrators that never forget that:
a)the money that they spend isn't endless,and
b)the money was,in the final anaysis,removed from the taxpayers involuntarily.
Uh, no, the decent, working families of Tennessee are going to win.
What a chicken turd.
Ha, this comes from a bald-faced LIAR. Don Scumquist campaigned on a no income tax promise. He is a mealy-mouthed LIAR who doesn't deserve the time of day. And he calls the general public "ignorant". Whew....!
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