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With Tennessee tax collections on the rise, Gov. Lee proposes more spending


NASHVILLE, Tenn. (AP/WMOT)  --  Gov. Bill Lee has added well over half-a-billion dollars in new spending to his state budget plan for the coming fiscal year.

In a press statement released Tuesday, Lee says $580 million in additional spending has been made possible by higher than expected tax collections.

Among the items included in the revised proposal is a $100 million, two-week sales tax holiday on restaurants, bars and groceries. No word yet on when the tax holiday might begin.

The state’s largest teacher’s union panned the proposal. The Tennessee Education Association suggests the governor spend the additional revenue instead on schools they say are underfunded.

The fiscal year 2021-22 state budget is currently under consideration by the Tennessee General Assembly.  A final budget must be approved by state lawmakers before the current legislative session ends late this month or in early May.

Here's the complete list of the governor's additional budget requests: 

Tax Cuts

  • $25M for a two-week sales tax holiday for groceries
  • $75M for a two-week sales tax holiday for restaurants and all prepared food
  • $16M to reduce the professional privilege tax by 25 percent

K-12 Education and Mental Health

  • $250M trust fund to assist K-12 families who are facing significant mental health issues in the wake of COVID-19
  • $18.5M to transportation to students for summer learning 
  • $2M to provide an additional 4 high quality, grade aligned books and resources over the summer for the 88,000 rising first graders in Tennessee

Higher Education

  • $79M to eliminate current TCAT waitlists statewide, currently at 11,400 students
  • $25M to Tennessee Promise to permit increases in the Hope Scholarship 
  • $4M to increase Agriculture Extension Agents at University of Tennessee and Tennessee State University

Rural & Agriculture

  • $50K to support the state fair (in addition to the $250,000 recurring in originally proposed budget for total of $300K and $5M non-recurring) 
  • $3M to provide additional funding for rural projects as part of the Rural Economic Opportunity Fund (in addition to $21M in originally proposed budget for total of $24M) 


  • $500K to provide gun safety programming for children 
  • $17M to replace radios for state troopers  
  • $18M to improve the statewide disaster communications system 
  • $680K to add 4 new Homeland Security Agents

Economic Development

  • $5M to provide grants to restore and preserve historic downtowns across the state 
  • $3M to increase employment in Tennessee through the Small Business Innovation program


  • $3M recurring and an additional $10M nonrecurring to provide additional direct funding to airports across Tennessee through the Transportation Equity Fund (total $50M investment in air infrastructure)