Tennessee budget shortfall looms because of COVID-19 shutdowns


NASHVILLE, Tenn. (WKRN) — On two different occasions this week, Tennessee Governor Bill Lee forecast a “significant loss” of revenue for the state budget, but he’s awaiting some guidelines from the federal government that could be key to shoring up the shortfall.

“It will clearly be one of the most important lines of business for our office and the legislature in the days and weeks and months ahead,” said the Governor Friday at his daily COVID-19 briefing. “Its a little too soon to know what those numbers might be.”

Those numbers will affect just about every Tennessean.

With businesses closed because of COVID-19, sales tax revenues which fund a big chunk of Tennessee’s budget will be way down.

The governor was more specific about the issue at a meeting this week about how federal stimulus money might be spent.

“We as a state, from a budget standpoint, the significant shortfalls that we have coming, that will be a lot of our focus going forward,” the governor said Wednesday to the group that includes the two speakers from Tennessee’s House and Senate.

Education, public safety, and healthcare are all areas that could be affected if those shortfalls can’t be shored up by federal money worth about $3.7 billion for Tennessee.

That is a related question for the governor and lawmakers who are waiting on guidance from Washington on where exactly that federal money can be spent, and if it could be used directly for budgetary purposes.

“As that guidance comes out, then we utilize that guidance to make decisions. Much is yet to come out, but we think it’s coming in the few days,” said the governor at Thursday’s COVID-19 briefing.

The state’s education commission cited K-12 schools as one area that already has the go-ahead to spend $260 million dollars of federal stimulus funds.

State Education Commissioner Penny Schwinn said the money would be spent focusing on students.

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