112th Tennessee General Assembly Adjourns

May 6, 2021
Firm Publication

The 112th General Assembly adjourned for the year, finishing the first year of the two-year session just after 9:00 p.m. on Wednesday night. Legislators worked to keep the General Assembly running as smoothly as possible as Tennessee continued to open up following the distribution of vaccines. This unusual legislative session will be remembered for Zoom meetings, mask wearing at the capitol, and social distancing.

Fiscal Year 2021-2022 Budget

Last week, the legislature passed a $42.6 billion budget. In stark contrast to the budget passed in 2020 which anticipated a $1 billion shortfall, the 112th General Assembly saw both a budget surplus and a significant amount of federal stimulus funds. The passed budget includes a one-time $250 million deposit into the state’s pension fund and a deposit of $100 million into the state’s rain-day fund. Below are a few other notable highlights of the budget.

  • $250 million investment into the Mental Health Trust Fund.
  • A 4% raise for teacher salaries.
  • $100 million in broadband infrastructure grants.
  • $50 million for a two-week holiday on food and restaurant sales.
  • $39 million initiative to increase the hourly wage of direct care staff employed at agencies contracted by the Department of Intellectual and Developmental Disabilities from $10.00 to $12.50.
  • $25 million annually for “Truth in Sentencing” reform, which prohibits certain violent or sexual offenders from certain early release opportunities.

Permit-less Carry Bill Passes

Governor Lee signed a bill allowing most adults to carry a handgun without a permit beginning July 1, 2021. Permit-less carry legislation was a top legislative priority for the governor in 2021, and it is estimated that it will cost the state $20 million annually. The law also increases penalties for criminals who steal or illegally possess firearms.

Cocktails-To-Go Remains Legal Through 2023

To help the struggling hospitality industry, Governor Lee issued a temporary order allowing the sale of alcoholic beverages for off-premises consumption. With the pending expiration of the temporary order, the General Assembly passed a bill to allow the to-go sales of cocktails, wine, and beer until July 1, 2023. The cocktails-to-go bill requires that drinks to-go must be purchased with prepared food. Additionally, the bill provides that the drinks must be in a sealed container that makes it clear that the drink is intended for at-home consumption. The maximum amount of mixed beverages that can be sold per meal is 16 ounces. The maximum amount of wine per meal is a single bottle. Bottles of distilled spirits cannot be sold for curbside sales.

Medical Marijuana Commission Bill Passes

In the last days of session, closed House committees were reopened to hear House Bill 490 (Commission Bill), a bill that would create a commission to study medical marijuana. The Commission Bill, which had been traveling through the Senate, had been delayed by the House sponsor while he focused his efforts on a patient decriminalization bill. The decriminalization bill created a pilot program that would allow Tennessee patients with certain debilitating medical diseases to possess medical marijuana that was obtained lawfully in another jurisdiction. The decriminalization bill failed by one vote in a House committee after passing multiple House and Senate committees.

The Commission Bill was revived in the House in an effort to take some action on the medical marijuana issue. The Commission Bill, passed Wednesday afternoon, will set up a commission that will serve as a resource for both the study of federal and state medical cannabis laws and the preparation of legislation to establish a medical marijuana program upon the rescheduling or de-scheduling of marijuana at the federal level. The Commission Bill also provides that Tennessee patients with certain debilitating medical diseases – such as ALS, HIV and cancer – may possess oil with no more than 0.9% THC. The low-THC oil must be obtained legally in another state. The Commission Bill will now be sent to the governor where he is unlikely to veto the legislation.

Criminal Justice Reforms Advance

Upon taking office in 2019, Governor Lee announced that criminal justice reform would be a top priority in his administration. That reform, however, was slow to come as the pandemic interrupted those efforts last legislative session. Some success finally arrived this year when the legislature passed several criminal justice reform bills with bipartisan support. One bill bans the use of police chokeholds unless an officer believes deadly force is authorized and prohibits the use of no-knock warrants. The legislation also prohibits retaliation against an officer who reports or intervenes in cases of excessive use of force by another officer. Other bills include efforts to establish community-based alternatives to incarceration, increased participation of people convicted of misdemeanors in a drug court treatment program, and programs designed to facilitate the reintegration of former inmates into their communities.

Reduction in Unemployment Benefits

In the final moments of session, legislators passed a law that will reduce compensation for unemployed individuals in the state from 26 weeks to a range of between 12 and 20 weeks, depending on the state’s average unemployment rate. The 12 week bottom of the range will make Tennessee’s unemployment benefits the lowest in the country – even though the benefit cap will increase up to $325 per week. The Republican-backed legislation originated from many anecdotal stories of small business owners who are having trouble meeting hiring needs. If signed by the governor, the bill will go into effect in December 2023.

Certificate of Need Reform

After years of debate and negotiations with stakeholders, the General Assembly passed certificate of need reform yesterday afternoon. While some advocates of reform believe that this bill does not go far enough, both lawmakers and most stakeholders believe this legislation is a fair and compromised starting point for reform. The bill makes several changes to existing law while keeping the current certificate of need requirements for outpatient diagnostic centers and ambulatory surgery centers.

New Court of Special Appeals

In the last days of session, the two chambers were advancing competing versions of a bill that would bypass the chancery court in Nashville as the venue for constitutional and redistricting challenges. Many political insiders thought that a consensus on how to structure the new system would not be reached in the conference committee and that the effort would die as a result. However, a compromise was reached between the House and Senate in the last minutes of session that will result in the creation of a new Court of Special Appeals.

At the time of this update, the adopted conference report is still not publicly available. At a high-level summary, a litigant who challenges a state or redistricting law will file suit in the chancery court of the litigant’s home county instead of in Davidson County. The case will then be heard by a panel of three judges with the judges on the panel hailing from each of the grand divisions of the state. The resulting panel is intended to be more representative of the state and less likely to lean Democratic, versus a single chancellor in Davidson County.

While the General Assembly has adjourned, many Capitol Hill insiders believe another special session may be called at the end of the summer. With unprecedented funds coming from the federal government, the General Assembly may return to allocate those relief funds.

If you have any questions about the actions of the 112th Tennessee General Assembly, please contact the authors.