Legislative Update: Hensley, Capley share weekly pertinent bills in Tenn. legislature

Sen. Joey Hensley, R-Hohenwald

The Tennessee Works Tax Reform Act of 2023 is advancing in the Senate and cleared the Senate Revenue Subcommittee with a positive recommendation on Tuesday. This legislation proposes a number of changes to Tennessee’s tax code to lower the tax burden on businesses, boost Tennessee’s economic competitiveness, promote entrepreneurship and small business formation, and provide targeted relief to families. This is one of Governor Bill Lee’s top legislative initiatives for 2023.

Tennessee is committed to low taxes and Tennessee businesses and citizens are in the best position to decide how to spend their own money, and this tax-cut proposal demonstrates that we practice what we preach. Governor Lee’s proposal is to provide more growth opportunities for businesses and financial relief for families on every-day expenses. Tennessee is proud to be one of the lowest taxed states in the nation, and this move to further cut taxes strengthens our dedication to being a pro-business and pro-family state with low taxes.

The tax cuts would provide significant tax relief to small businesses by lowering the burden of the franchise and excise tax as well as the business tax rate. Under the proposal, over 23,000 small businesses in Tennessee will have their excise tax liability reduced to zero by exempting the first $50,000 in income from the state’s excise tax. It also exempts up to $500,000 of business property from franchise tax liability.  The tax cuts would exempt 140,000 Tennessee businesses from the business tax by raising the threshold for business tax exemptions from $10,000 to $100,000 of gross receipts. In addition, it reduces the highest business tax rate from 0.3% to 0.1%.

The proposal will also help Tennessee lead the nation in economic competitiveness, while prioritizing Tennessee businesses. It incentivizes businesses to hire Tennesseans and headquarter in Tennessee by changing the way the excise tax is calculated to favor businesses with a higher percentage of their properties and jobs located in Tennessee than in other states. It also ensures state tax deductions for research and development (R&D) expenses – which help companies grow, innovate and produce superior products and services. This move comes after the federal government ended yearly R&D tax exemptions for businesses.  The measure also removes unfair taxes on certain manufacturing facilities with unsold inventory.

Finally, the proposal will deliver for working families by creating a three-month sales tax holiday on food during August, September and October 2023. It also seeks to incentivize businesses to provide paid family leave to employees by establishing a state paid family leave franchise and excise tax credit on wages paid for a two-year pilot period.

Increasing teacher pay – A bill that would provide pay increases to Tennessee teachers cleared the Education Committee this week.  Senate Bill 281 would each year increase the base salary for teachers until it reaches $50,000 in the 2026-2027 school year. The bill would also end the practice of local school district deductions for national, state and local labor organizations. Currently, school districts are permitted to provide these unions with a free benefit of collecting dues on their behalf. Taxpayer resources in K-12 education should not be used to support these activities, whether political or otherwise, of any organization, including labor unions. The legislation does nothing to restrict a teacher’s choice to join and fund any activity by the union; it simply ends the practice of using taxpayer resources to fund the collection of dues for the union’s benefit.

Rep. Kip Capley, R-Summertown

General Assembly confirms new Tennessee Supreme Court Justice - Members of the General Assembly confirmed the appointment of Dwight E. Tarwater to the Tennessee Supreme Court in a joint session in the House chamber on Thursday.

Tarwater, a Knoxville attorney, brings more than 40 years of legal background to the court, including decades of trial and appellate experience. He also previously served as chief legal counsel to former Gov. Bill Haslam from 2014 until 2019. The vacancy on the Tennessee Supreme Court will be created by the retirement of Justice Sharon Lee, effective Aug. 31. Tarwater’s tenure on the court officially begins Sept. 1. The General Assembly is required to confirm appointments for Supreme Court Justices per an amendment added to the state constitution in 2014. Justices are retained through a “yes” or “no” election every eight years.

Also on Thursday, the General Assembly confirmed the appointment of Matthew Wilson to the Tennessee Court of Criminal Appeals for the Western Section. Wilson previously served as an assistant United States attorney in the Western District of Tennessee. He brings significant criminal law experience to the Court of Criminal Appeals, including nearly 20 years of legal service at both the state and federal levels. Wilson fills a vacancy that was created by the death of Judge John Everett Williams in September.

Small Government Efficiency Act becomes law - Gov. Bill Lee on Thursday, March 9^th  signed legislation that ensures effective local representation and the utmost efficiency for taxpayers.

House Bill 48, also known as the Small Government Efficiency Act, reins in excessive government growth by lowering the maximum size of metropolitan and municipal legislative bodies in Tennessee to no more than 20 voting members. It passed on Monday in the House chamber and on Thursday morning in the Senate. The city of Nashville, which would fall under the scope of House Bill 48, has a population of 690,000 and is the 21st largest city in the United States. Nashville’s 40-member council is currently the nation’s third largest, just behind New York City which has a 51-member council and a population of 8.8 million, and Chicago, which has a 50-member council and a population 2.7 million.

Local government bodies exceeding 20 voting members will be required to dissolve and re-appropriate current districts using the latest federal U.S. Census data to ensure equal representation based on population by May 1, 2023.

Republicans seek to increase school bus safety in Tennessee - Republicans this week advanced legislation strengthening punishment for drivers who illegally pass a school bus that is picking up or dropping off children.

House Bill 818, sponsored by State Rep. Sam Whitson, R-Franklin, would make it a Class E felony if a driver illegally passes a school bus and strikes another person. It would be a Class C felony if the individual died.  The legislation would also increase the fine for not stopping for a school bus from $200 to $250 for the first offense based solely on video camera footage from the bus. The minimum fine for a second or subsequent offense would increase from $250 to $500.

In 2022, there were 84 citations issued to drivers who illegally passed a school bus that was either picking up or dropping off children, according to data from the Department of Safety and Homeland Security. House Bill 818 is scheduled to be heard in the Finance, Ways and Means Subcommittee on March 15.

Rural Brownfield Investment Act conserves green space, creates greater economic opportunities - Both chambers of the General Assembly this week unanimously passed legislation that will fast-track the redevelopment of former industrial sites, known as brownfields, throughout Tennessee.

Gov. Bill Lee in February announced his proposal to clean up brownfields as part of his legislative package for 2023. State Rep. Ron Gant, R-Piperton, guided passage of the bill, known as the Rural Brownfields Investment Act. House Bill 319 creates a state-administered brownfield grant program with the goal of providing technical and financial resources directly to communities while bolstering incentives for developers. It will provide $5 million annually for investigation, assessment and remediation to local governments, economic development agencies, development boards and county land banks.

Brownfields are generally defined as abandoned or underutilized properties like industrial facilities. Their use or development can be complicated by the presence of a hazardous substance, pollutant or contaminant. They often contribute to blight and community decline. The bill now heads to the governor’s desk for his signature.

Republicans aim to prohibit taxpayer-funded abortions - Republicans this week advanced legislation that would prevent any city, county or metropolitan government from using taxpayer dollars to directly or indirectly assist with obtaining an abortion or abortion-related services.

House Bill 90, prohibits taxpayer funds from being used as part of a health benefit plan or for travel to a state where abortion is legal. It ensures no municipality, county or metropolitan government in Tennessee reallocates tax dollars, cuts critical services or staff positions to pay for abortions or abortion-related services.

The Tennessee Constitution gives the State of Tennessee authority over local government bodies and allows the state to preempt a local government as long as it does not violate a right guaranteed by the State Constitution. House Bill 90 is expected to be considered in the House Local Government Committee on March 14.

It is an honor and privilege to be able to serve in the 71^st District. If you have any questions or concerns, do not hesitate to call or email our office at rep.kip.capley@capitol.tn.gov or 615-741-2190.

This article originally appeared on The Daily Herald: Legislative Update: Hensley, Capley share weekly bills in legislature