Posted on 05/29/2002 8:49:31 PM PDT by GailA
Service tax garners only 17 votes in Tennessee House
By TIM WHALEY
A plan to broaden the sales tax to exempt services garnered only 17 votes in the Tennessee House on Thursday, but House members did authorize the use of state reserves from the rainy day fund and 28 earmarked funds to cover a $480 million current year budget deficit.
House members then agreed to adjourn until June 19, with only one regular session day left.
After that last day expires, lawmakers will not be paid for their services, and only 11 days will remain to pass a budget.
The House service tax vote came in with less than 50 no votes, thanks to 32 members who voted present. That means the bill is alive for further consideration, and some local supporters plan to work on a modified version of the plan.
Reps. Steve Godsey, R-Blountville, and Jason Mumpower, R-Bristol, said they continue to support the concept of an expanded sales tax coupled with other measures to raise about $800 million.
That would be sufficient to fund a continuation budget for fiscal 2003, with no raises or improvements in any area beyond those mandated by laws and courts.
Godsey said support for the service tax, House Bill 2942, waned after so many exemptions were necessary, such as medical services, that the measure couldn't raise sufficient funds unless the state sales tax rate was kept at 6 percent.
"If we can reduce the rate to 5 percent, it will pick up more support," Godsey said. "I cannot vote for it unless the rate is reduced."
Rather than applying the service tax to undesirable items, including medical and health care services and raw materials used in manufacturing and farming, Godsey said he could see a sin tax bill added on, as well as a "wheel tax or license tag registration fee increase."
"What we talked about this morning among some of us was lowering the sales tax rate to 3 or 4 percent, then looking at other areas. Representative Bill Dunn has a bill raising sin taxes by $170 million or $180 million," Godsey said.
That sum tagged onto the $528 million or so raised by an expanded sales tax would bring in about $708 million, within striking distance of the $800 million that just about all lawmakers agree must be raised at a minimum.
Others, including the sponsors of the expanded sales tax plan that failed Wednesday, would like to see a sum closer to $1.4 billion raised to advance education and other state services.
A continuation budget would mean the end of at least $40 million in local government supplements and services, spanning from police and firefighter training pay to safe school grants.
Mumpower said he would be "hesitant to do anything that would negatively impact what remains of the important tobacco farming community I represent."
Nonetheless, Mumpower said the sales tax expansion plan can serve as the "skeleton that the meat is hung on" in terms of a budget solution.
Responding to criticism that some lawmakers, including himself, might not be so active in finding a solution, Mumpower said he is meeting with like-minded Republicans and Democrats who oppose a state income tax.
"The chairman of the House Education Committee (Rep. Les Winningham, D-Huntsville) the chairman of the Judiciary Committee (Rep. Frank Buck, D-Dowelltown) and the majority leader (Rep. Gene Davidson, D-Adams), all of us are working on this," Mumpower said.
Mumpower said that group of Democrats and Republicans are "working equally as hard on other options" as those who support an income tax.
"I would hope that just because some people are for one thing and one thing only, they do not refer to those who are not for that thing as ‘do nothings,'" Mumpower said. "We are definitely helping move us forward."
A third House Republican, Rep. David Davis, R-Johnson City, said he has made House leadership aware of his preferred plan.
That entails raising the state sales tax to 10 percent and removing the sales tax from food, which Davis said would save his average constituent $6 week and still raise $900 million in new state revenue.
In the alternative, Davis said he is willing to "look at" expanding the sales tax to services and lowering the overall sales tax rate.
"The tax bill we voted on today wasn't a serious attempt to pass legislation," Davis said. "I think while the income tax is still alive, nothing else is going to be taken seriously. Leadership is going to have to know once and for all that an income tax will not pass before anything happens."
A 4.5 percent flat income tax garnered 45 votes last week and is said by some to have 47 votes this week.
Ultimately, Rep. Keith Westmoreland, R-Kingsport, said it will be difficult to cobble together 50 votes for the service taxes.
"I saw a lot of folks a little more enthusiastic when they thought the sales tax rate would be reduced, and it wasn't, which had a major part in my decision in voting against it," Westmoreland said. "It may also have gotten in trouble trying to work with every single person in here who said ‘I need this out or I need this in.'"
Meanwhile, every lawmaker interviewed for this article agreed with using up the state's reserve funds to balance the current year deficit of $480 million.
The House only authorized the tabbing of 29 funds, including the state's $178 million rainy day fund and 28 earmarked funds, including the criminal injuries compensation fund; work release, parole and probation supervision and rehabilitation fees; temporary assistance to needy family reserves; wetland, state parks and local parks acquisition funds; alcohol and drug treatment fund; traumatic brain injury fund; electronic fingerprint imaging systems fund; driver education fund; sex offender treatment program funds; and safe schools funds.
Although raiding those funds is authorized, they must be appropriated in the budget process.
These three idiots still don't get it. CUT THE BLOATED BUDGET QUIT PASSING MORE TAXES TO FUND BLOATED BUDGETS FULL OF PORK!
Rep Steve Godsey (R) & Jason Mumpower (R)& David Davis (R)
FOLKS IN THEIR DISTRICTS NEED TO GET MORE ACTIVE IN LETTING THEM AND THE CITIZENS KNOW THEY SUPPORT MORE TAXES. GET BUSY AND PASS OUT FLYERS. Use this quote from Rep Davis:
Rep (David Davis), with the agreement of Crowe and Patton, said a shortfall in the current budget of upwards of $350 million is a "real deficit,'' while past budgets "artificially" inflated expenditures to produce a deficit. (The Kingsport Times)
The Oak Ridger
May 29, 2002
GOP leader says residents support an income tax
SEVIERVILLE (AP) -- State Sen. Bill Clabough says he's found surprising support for a state income tax among his constituents in Sevier and Blount counties.
Nearly two-thirds of the people responding to the Senate Republican Caucus chairman's full-page newspaper ads seeking advice say they would accept an income tax to avoid severe government cutbacks.
Of 210 responses, 132 -- or 62 percent -- said they would support an income tax, 33 (16 percent) said they would support an increase in the sales tax and 44 (22 percent) said they preferred major cuts in government spending.
"Although unscientific, it's a method for me to gauge the priorities of the people in my district, and see what kind of state they want," the Maryville resident said. "So far, the majority want a better system -- a state we can be proud of."
Clabough said he was "a little surprised at the strength of the income tax" among his typically conservative constituents, and encouraged that nearly 80 percent believe new revenue is needed.
"Philosophically, I am not opposed to an income tax or a sales tax increase," said Clabough, who remains undecided in the debate over a multimillion-dollar state budget deficit.
Saying there are pros and cons to each, he said he is eager to see what the House will do and "not lock myself into one plan or one avenue -- to be open and flexible and see what the majority wants to do."
Last week, the House tried and failed to approve a flat-rate income tax, though the issue remains alive.
In full-page ads Friday in The Mountain Press of Sevierville and The Daily Times of Maryville, Clabough outlined the alternatives for his constituents.
He asked them to choose between Gov. Don Sundquist's proposed budget, which raises state spending by $691 million, or the Downsizing Ongoing Government Services (DOGS) budget plan, which cuts $775 million.
Clabough said the Sundquist plan would mean more money for education, medical care for the poor and for state parks, public health and homeland security.
By contrast, the DOGS proposal would force teacher layoffs, college tuition increases, leave 350,000 Tennesseans without health insurance and eliminate the state departments of tourism and economic development.
But Clabough told constituents paying for Sundquist's plan would require them to choose between a 4.5 percent income tax (along with removing sales taxes on food, clothing and non-prescription drugs) and a penny increase in the sales tax to 9.75 cents on the dollar.
Clabough said he won't encourage other lawmakers to conduct similar surveys, but he said he will use the results of his poll as a personal "foundation to work from" as the debate continues.
and TENNESSEE is ONE OF MANY disputed states!
Can someone check:
Andrew Jackson sort of set the mold for Tennessee politicians. He did pretty much as he pleased. He defied the Supreme Court on the Indian removal issue. Jackson sid something to the extent that he had an army and that the Supreme Court should get their own army if they wanted to oppose his actions.
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