Finance subcommittee advances $59.7 billion FY26 appropriations bill to full finance

The Finance, Ways and Means Subcommittee on April 15 voted 13-0 to advance House Bill 1409, the fiscal year 2026 appropriations act as amended, to the full Finance committee.

Chairman Hicks described the bill's revenue and spending assumptions, saying the FY26 budget totals $59.7 billion and is funded roughly 50% by state appropriations, 35% by federal funds and 15% by other sources. "The budget this year, the fiscal year 26 budget is 59,700,000,000.0," Chairman Hicks said during his presentation.

The committee adopted three amendments filed by Chairman Hicks (drafting codes 7420, 3600 and 4400) before taking the final vote. No roll-call votes on individual amendments were recorded in the transcript; the chair put each amendment and members responded "aye," and each amendment was placed on the bill. The clerk recorded 13 ayes, 0 nos on final passage to full finance.

Why it matters: HB1409 sets the state's spending priorities for the coming fiscal year, including recurring and nonrecurring allocations that affect education, health services, transportation and disaster relief.

Major revenue and spending highlights provided by Chairman Hicks:

- Total FY26 budget: $59.7 billion; funding breakdown presented as roughly 50% state appropriations ($29.7 billion), 35% federal funds ($20.8 billion) and 15% other sources ($9.2 billion).

- Revenue assumptions: the budget assumes no tax growth for the current fiscal year and 2% growth for FY26, which Chairman Hicks said equates to $376.7 million in additional recurring state revenue. Departments reverted over $1.5 billion in unspent funds at the close of FY24, and roughly $700 million in nonrecurring funding is assumed from the treasurer's investment earnings.

- Disaster relief: $597 million included for disaster response and recovery, with line items described by the chair that included $240 million for disaster relief grants to address nonfederal cost-share obligations, $110 million for a hurricane-related interest payment fund, $125 million for the governor's response and recovery fund, $100 million from TennCare shared savings allocated for local governments, $20 million for Hampton High School reconstruction in Carter County, and about $2.3 million in grants to property owners damaged or destroyed by Hurricane Helene.

- Education: more than $640 million in new state funding for K-12, including $198 million for one-time teacher bonuses, $148 million for TISA growth allocations, $17 million for incentives for high-performing LEAs in grade A schools, $25 million for fast-growth stop-ins through TISA, $20 million for charter school facilities, $20 million for a school safety grant fund and $27.3 million for summer learning camps and transportation. Higher education received $264 million for outcomes funding, raises, insurance rate increases and capital improvements.

- Health and social services: over $1.5 billion in new spending, including shared savings allocations (e.g., $98 million for hospital buybacks, $28 million for nursing home provider stability), $18 million to raise direct support professional wages from $15.37 to $15.68 per hour for home- and community-based waiver services, $15 million for behavioral health infrastructure and $24 million for year 4 of a dental pilot program.

- Law and public safety: approximately $378 million for new initiatives, including funding for additional positions at the Tennessee Bureau of Investigation and Highway Patrol, public safety grants and violent-crime intervention grants.

- Economic and transportation investments: $213 million for Economic and Community Development projects and fast-track reserves, $1 billion appropriated for TDOT (general fund subsidy), aviation funding and expanded grant pools for volunteer fire departments, EMS, rescue squads, senior centers, museums and—for the first time—courthouse capital maintenance and improvements.

Representative Shaw asked for clarification on courthouse grants; Chairman Hicks said the courthouse grant pool is new and will assist local governments with capital maintenance and improvements, and that municipalities receiving certain TF (transportation funding) would not be eligible for the courthouse grants. "This year, we... create a new grant pool... for local governments for their courthouses," Chairman Hicks said.

The chair said legislative reallocations and member-requested amendments are included in the bill: the legislative amendment reallocates roughly $179 million from the governor's proposed budget to fund $181 million for member-requested amendments and legislation.

What comes next: With the subcommittee vote recorded as 13 ayes, 0 nos, HB1409 advances to the full Finance committee for further consideration and potential floor action.