business

Rick Perry visits Oak Ridge as Trump pushes cuts to Department of Energy budget

Newly appointed Secretary of Energy Rick Perry toured several labs at the Oak Ridge National Laboratory and Y-12 National Security Complex Monday, reports the News Sentinel. The former Texas governor rode around in 3D-printed vehicles and talked about President Donald Trump’s proposed budget cuts for the Department of Energy.

According to Science Magazine, Trump’s proposed budget would cut $900 million, some 17 percent, of the $5 billion budget for DOE’s Office of Science. And it would eliminate DOE’s roughly $300 million Advanced Research Projects Agency-Energy.

“I know how to budget, I know how to manage and I know how to prioritize. Obviously what you see here, I happen to think is a high priority,” he said. “I have not been in the job long enough to go through line item by line item, but because the budgeting process is nigh upon us here, I’m doing my homework every day.

“Hopefully, we will be able to make that argument to our friends in Congress, that what DOE is involved with, particularly on the economic development side, plays a vital role not only in the security of America, but in the economic well-being of this country as we go forward,” he said.

Perry said the budgeting process was not his first rodeo, something ORNL Lab Director Thom Mason could relate to.

“I mean we’re an Office of Science lab, so if you reduce Office of Science budget by 17 percent we’re going to feel that … if that was the final answer I would be quite worried with how we would respond,” Mason said after the tour. “Having been through the budget process many, many times now I kind of recognize that you need to let things play out.”

Perry agreed and said he expects to see the proposed budget change before it is passed.

Nashville-only ‘Airbnb bill’ passes House; then dies in Senate committee

The House on Monday evening approved a controversial, much-lobbied and much-revised bill imposing state regulations on short-term house rentals – the final House version targeting only Nashville for key restrictions. But the companion Senate bill died today in the Senate Finance Committee, postponed until next year.

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Tourist trips to TN set new record in 2016

News release from TN Department of Tourist Development

NASHVILLE, Tenn. – The Tennessee Department of Tourist Development joins tourism industry partners to celebrate National Travel & Tourism Week May 7-13 by marking another year of record-setting growth for the state’s $18.4 billion tourism industry.

According to the latest research from DK SHIFFLET, 110 million people visited a Tennessee destination in 2016, a 4.4 percent year-over-year increase, making Tennessee one of the Top 10 states for domestic travel in the United States for the third consecutive year. Approx. 80 percent (88.4 million) of Tennessee visitors are leisure travelers, an increase of 5.1 percent compared to 2015. This increase of leisure travelers can be attributed to overnight stays, which grew by 5.2 percent.

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Rural TN governments duped by corporate landfill operations?

The Tennessean has a report on controversy surrounding two rural West Tennessee communities dealing with big corporations that located landfills within their boundaries, expanded them over the years to take in allegedly toxic wastes polluting the environment — and now seek to exit the scene.

The article’s focus is on Decatur County (so rural the article uses the county name as a dateline rather than the county seat, Decaturville), which has a lawsuit going against a subsidiary of Waste Industries Inc.

In February, a surprise inspection by county officials found high levels of arsenic, ammonia, cyanide and other heavy metals in leakage from the landfill they traced into a creek that flows to the Tennessee River, the source of the community’s drinking water.

A day after county officials inspected the landfill, the company filed suit seeking to walk away from its contract to manage the landfill.

County officials have counter-sued, contending Waste Industries is trying to leave it with a multi-million dollar environmental mess. They have also filed formal notice with the federal Environmental Protection Agency of their intent to sue the company for violations of federal clean water and solid waste rules.

Cited as a similar situation is the town of Camden (county seat of Benton County, located about 45 miles away).

In Camden, landfill owner Environmental Waste Solutions, which likewise accepted thousands of tons of “special wastes,” filed for bankruptcy and abandoned operations earlier this month. Local District Attorney Matthew Stowe is investigating the company for possible public safety and white collar crimes while Tennessee Department of Environment and Conservation, or TDEC, officials are working to contain the site.

The two landfill controversies also have something else in common: Community leaders and residents are laying part of the blame on TDEC for not holding landfill operators accountable.

…TDEC officials take strong issue with criticism they have not done their job or protected local communities.

‘Nashville,’ taxpayer-supported TV show, gets another season

CMT announced on Monday there will be a sixth season of the TV show Nashville, which has now received about $57 million in subsidies from state government and Nashville, reports WSMV.

Last year, the show was canceled by ABC and picked up by CMT. It’s now CMT’s top-rated show, and taxpayer money has helped keep it alive.

“I can tell you unequivocally the show Nashville is not a good investment for taxpayers,” said Mark Cunningham with the Beacon Center of Tennessee.

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24 big firms collectively save $57M per year under Haslam corporate tax break plans

Gov. Bill Haslam’s administration has calculated that one provision in the governor’s tax package would collectively give $113.8 million annually ib tax breaks to 518 Tennessee companies with just 24 big firms get more than half the benefits in corporate tax cuts, reports the Times-Free Press.

Haslam calls his tax package the IMPROVE Act; other supporters have begun calling it The Tax Cut Act of 2017. It increases gas and diesel fuel taxes while lowering the sales tax on groceries and some other levies – most notably a break for manufacturers in payments of franchise and excise taxes. The newspaper says it got a copy of the administration analysis, which has not been released publicly.

Twenty-four large manufacturers would see annual reductions of $1 million or more in their state franchise and excise taxes, according to the analysis obtained by the Times Free Press and verified by two legislative sources. Those tax breaks would account for $57.44 million, or 50.7 percent, of the total $113.3 million.

Another 145 companies would see tax cuts between $100,000 and $1 million, for a collective reduction of $47.95 million. All told, 93 percent of the proposed change, or $105.4 million, would go to companies that would save $100,000 or more. Some 349 smaller companies would share a $7.89 million reduction., according to the analysis.

Haslam said the manufacturers’ tax cut is aimed at encouraging existing companies to boost investment and new ones to locate to Tennessee by letting them choose the formula for calculating their franchise and excise tax burden.

…The analysis does not identify specific companies impacted. State law prohibits public disclosure of most taxpayer information.

‘Petland bill’ passes Senate, fails in House

A bill setting state standards for pet store operations while restricting their regulation by local governments was approved by the Senate but then failed on the House floor Monday evening after extensive debate.

The final House vote was 45 yes, 47 no with two present and not voting. Fifty votes are required for passage. The measure known as “the Petland bill” (SB519) had passed the Senate 19-11.

Much of the debate in both chambers came over amendments to exempt various counties and cities from being covered the bill sponsored by Sen. Becky Massey, R-Knoxville, and Rep. Pat Marsh, R-Shelbyville.

All such efforts failed in the Senate, but the House approved three of 13 such efforts – applying to Blount County, Sumner County and the City of Hendersonville. All the amendment votes were close – ties in two cases.

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TN out-of-state sales tax collection rule draws lawsuit

Attorneys for American Catalog Mailers and NetChoice, an association of e-commerce retailers, filed a lawsuit Thursday in Davidson County Chancery Court challenging Tennessee’s effort to require retailers based outside the state to collect sales taxes from their Tennessee customers, reports the Times-Free Press.

The complaint seeks a declaratory judgment against the Tennessee Department of Revenue and Revenue Commissioner David Gerregano over the department’s Rule 129, which was adopted last year.

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Bill set for passage bans local regulation of pet stores

A bill drafted at the request of Petlland, a pet store chain looking to expand franchise operations in Tennessee, includes consumer protection for purchasers of cats and dogs as well as protection of pet sellers from local government regulation.

The bill (SB519) is sponsored by Sen. Becky Massey, R-Knoxville, and Rep. Pat Marsh, R-Shelbyville, while opposed by animal advocacy groups. It has cleared committees in both the House and Senate and is scheduled for floor votes in both chambers this week.

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TN business incentive tally: $2.5B per year (double national average)

 

A study by the W.E. Upjohn Institute for Employment Research indicates Tennessee state and local governments provide more than $2.5 billion in business incentives annually. That’s nearly 1 percent of the state’s private-sector gross domestic product and makes Tennessee fourth highest in the nation, the study’s author, Timothy Bartik, tells The Tennessean.

In exchange for taxpayer support, businesses are expected to generate jobs and spur economic growth. State and local leaders point to success stories — new companies attracted by economic development packages. But there’s an inherent trade-off for the taxpayer. Grants and tax revenue could instead be directed to improve schools, fix crumbling highways and other key government functions.

The analysis, “A New Panel Database on Business Incentives…in the United States” leads to some key questions: how much is enough? And are the incentives designed to attract well-paying jobs, or dead-end work with little or no benefits? (Note: You can download a copy HERE.)

Bartik, a senior economist at the Michigan-based think tank, found that states with high levels of incentives don’t have significantly better economic performance than their neighbors.

“If incentives have an effect, it’s at best relatively modest,” he said.

Compared with neighboring states, Tennessee leads the way. Incentive levels are 91 percent lower in Virginia, for instance, and 82 percent lower in Georgia. As of 2015, Tennessee’s incentives are 105 percent higher than the national average.

The state stands out for its property tax abatements, the analysis found. In these deals, local governments typically agree to forgo property taxes if a company commits to creating a certain number of jobs and investing a certain about in capital. Because companies make annual payments in lieu of taxes, the arrangements are called “PILOTs.”

ABOUT THIS BLOG

Former Knoxville News Sentinel capitol bureau chief Tom Humphrey writes about Tennessee politics, government, and legislative news.

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