Gov. Lee Asks Tennessee Departments To Cut 12% From Spending Plans

Every single Tennessee agency could see a 12% reduction in their budgets starting July 1. Gov. Bill Lee’s administration has recently asked the department heads to see where they can save money.

The administration says this is part of the unprecedented financial challenges the state is facing. Not every department would end up losing 12% of its funding, but the administration warns that cuts will be far higher than in recent years. Finance and Administration Commissioner Butch Eley told members of the Senate Finance, Ways and Means Committee that the agencies should assume that those reductions are permanent.

“That would increase savings through the year that would help us through the next fiscal year,” Eley said.

Additionally, the state is also looking at trimming what it planned to spend on construction.

Although the state’s budget planners paint a grim picture, they acknowledge they still don’t have a clear picture about sales tax collections, with represent a majority of the state’s revenue. Eley said the April numbers are likely to be down 15%.

The state is expected to have the latest revenue numbers by mid-June. That will help the legislature further decide what to cut from the budget.

Eley said balancing the state’s finances may even require reducing the state workforce.

“I’m not going to say that we absolutely will never touch any personnel, because I don’t think we can make that statement,” Eley said. “But, I think we’ve definitely got to be sensitive to critical mission positions.”