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Budget Plan as of May 22, 2007 Summary of Major Items ‘Education Lmprovements ($448.4 million) * Funds portion of the BEP 2.0 reform plan (total plan = $476 million) © “barks” $100 million in recurring dollars to ensure that second installment of BEP 2.0 improvements can be funded in FY 2008-09 * Funds 3% cost of living increase for higher education employees and K-12 teachers (K-12 done as part of BEP 2.0 implementation) = Fonds the next four (4) higher educations capital outlay projects 9° UT- Knoxville - Music Center © Pellissippi State: Blount County Center Improvements © UT-Chattnooga - new library building © Northeast State Technical Community College — Technical Education Complex * Fully finds the equipment replacement program for Tennessee Technology (Centers across the state ($21 million total) ‘Funds a pilot program for enhencing math teaching skills for K-4 students ‘Employee Compensation ($75.8 million) * Funds 3% cost of living increase for state employees + * Provide fimds for implementation of Comprehensive Pay Plan Study OR next third of compression pay plan * Provides finds for classification compensation adjustments to keep entry salaries competitive * Increases the employer match under the state*s 401(L) program for state and higher education employees by $10 (Grom $40 t0 $50 per month) * Provides funding for salary increases for employees with unique pay plans, like state troopers and others - ‘Tax Relief ($40.7 million recurring) * Permanently reduces the state sales tax on grocery food by 0.5% (from 6% to 5.5%) Other Priorities ($13.9 million criminal justice related, $40.8 million other) + Restores the highway fimd ons recurring basis * Funds various elements related to criminal justice ({.e. forensic medical exams, additional ADA’s, PD's) + Funds the retirement supplemental bridge benefit for public safery officers Reserves fimding for other legislation deemed a priority for passage, potentially including portions of the “Crime Package” + Provides funding for Community Enhancement Grants Sets the rainy day fund at $750 million by June 30, 2008 ~ Revenue Measures * Assumes passage of the Governor’s proposed $.40 tobarco tax increase & technical corrections bill * Assumes using revenue estimates at top of Funding Board range for both FY 2007 ‘and FY 2008 * Hdeemed necessary, assumes passage of the “Copeland” Cap Bills for both FY (2007 and FY 2008 House Democrats House Republicans Schools First Plan | State Employee Pay | Takes raises to 3% COLA- | Leaves af 1 percent raise Raises $94 Millian recurring | takes to-4 percent bonus— | * | $105 Million one time | ‘State Employee | $26.8 Million (next third of | $0 | Compression compression) ‘State Employee | $10 Millon | so Classification | \ ‘Compensation Funds [aot (k) $40 te $50 a month [No increase ' | increase [Addifional OAs and PDs [$13 Milion 30 Restore jnway Fund $32 8 Million ‘$0 ($32 Million One-Time} Sales Tax on Food “5% reduction of grocery | 1% reduction of grocery iterns $40.7 Million items $81 million ‘Additional Higher ‘$129.5 Milion $0 Education Capital Outlay | Projects ‘Tennessee Board of $14 Million Non-Recurring | $0 | ts: fund remainder | of TTC equipment | requirement | ‘Community Enhancement | $20 Milton Non-recarring | $0 (Mast Republicans fled Grants amendments for ‘Community Enhancement Grants). P20 Funds $290 Million and Funds $190 Million and "banks" $100 Million for | contains $0 for second ‘second instaliment next instaliment next year. year. Agriculture Grants S24 Million sO Rainy Day Fund $750 Million Total — 8216 | $533.5 Million Total fo million this year $36.9 Millon This Year Reduces ‘Maintain at $10 million Reduced $5 Million Funding J House Republican Plan compared to House Democratic Plan Shortchanges employees — = Provides 1% COLA and 4% bonus; will feel like a pay cut in FY 09 unless all of the bonus is replaced — approx. cost = $190 million * Fails to provide funding to class comp to keep salaries competitive = Fails to-provide funding for either the comprehensive pay plan or compression situation * Fails to-increase the 401(K) match = Summary - siaie services are delivered by state employees, must be able to recruit & retain employees: Republican plan represents a slap in face to state employees, teachers & higher ed ‘Shortchanges the BEP 2.0 reforms Their plan provides about $190 million toward funding of BEP 2.0, almost $100 million less than in House Dem plan ($290 m) * House plan banks $1000 m of recurring moncy to be used to fund future installments of BEP 2.0 - guaranteeing its implementation — their's doesn’t (a hollow promise) ‘Shortchanges economic development funding * Reduces FastTrack funding — vital to recruitment of new jobs for Tennesseans Fails to provide additional criminal justice resources * Our plan provides over $13 million to fund improvements in the criminal justice system, ine. adding much needed positions in the offices of DA’s, PD*s and Board of Pardons & Paroles Fails to significantly increase the state's rainy day fund + House Dem plan adds over $216 million to rainy day fund — planning on being at % of a billion doliars by 6/30/08 = Provides vital cushion to give time to make spending adjustment in times of fiscal stress Doesn’t fully restore highway fund * Doesn't place $32.8 million in recurring funds (uses one-time funds). Calls for full one percent off of sales tax on food * Democratic plan calls for one-half percent Fails to provide for Agricultural grants earmarked under Schools First pl + Represents a total of $21 million to our rural members Fails to provide for community enhancement grants (this despite the submission of budget amendments by most of the Republican Caucus),