Finance and Administration presents $345.9 million administration amendment; seeds $100 million for Duck River water regionalization

Jim Bryson, commissioner of finance and administration, and his budget team presented the administration amendment to the Finance, Ways and Means Committee on March 25, 2025, outlining $345.9 million in new resources and proposed allocations across health, education, infrastructure and public safety.

Bryson described the package as "plain vanilla," noting the amendment focuses on recurring funds because the state has limited nonrecurring capacity. He told the committee the amendment relies on $30.9 million in recurring revenue and $315 million in nonrecurring sources for a total of $345.9 million.

Why it matters

The amendment contains several multi-million-dollar allocations that affect hospitals, nursing homes, schools, airports and water infrastructure across Tennessee. Members pressed staff for details on distribution and eligibility for several line items; staff agreed to provide follow-up materials and application guidance.

Key figures and sources

- Treasurer's earnings: $200,000,000 (nonrecurring) recognized for the amendment. - Reversion: $115,000,000 (nonrecurring). - ESA hold-harmless expiration: $23,700,000 base reduction added back to recurring funds (the three-year hold-harmless provision has expired). - Total recurring revenue added: $30,900,000; total nonrecurring: $315,000,000; combined: $345,900,000. - Balances after proposed expenditures: $10,900,000 recurring balance; a negative $8,400,000 nonrecurring balance covered by recurring funds, leaving $2,600,000 net.

Major proposed allocations (highlights)

- Nursing home stability funds: $28,000,000 (state) plus a $53,000,000 federal match, for a combined $81,000,000 infusion. - Hospital assessment buyback: $20,700,000 (state) to reclaim the hospital reimbursement ceiling, matched by federal funds (total near $58,000,000). - School safety grants: $20,000,000 (nonrecurring); committee members asked for distribution details and were told staff would follow up. - Charter schools facilities fund: $20,000,000 (nonrecurring) to help charter schools with capital needs; application details to be provided. - General aviation: an additional $25,000,000 (nonrecurring) added to a fund typically kept at $50,000,000 to support maintenance at 72 general aviation airports. - Indigent representation program (AOC): $13,000,000 recurring and $4,000,000 nonrecurring to restructure and fund indigent defense services, incorporating existing attorney-pay pools into a new program. - Victim services/VOCA match: $20,000,000 (nonrecurring) over two years to help local victim services agencies match federal VOCA funds. - AI implementation: $10,000,000 to support implementation of promising AI pilots across state agencies. - Capital items: $1,000,000 for East Tennessee State Veterans Cemetery flood mitigation; an additional $21,300,000 for the Memphis Airport TCAT relocation and rebuild; $25,000,000 added to the MTSU Murphy Center renovation; recognition of $489,500,000 in higher-education bond projects.

Duck River water regionalization

Bryson outlined a $100,000,000 seed allocation toward a roughly $1 billion regional water project to move water from the Cumberland River to fast-growing portions of southern Middle Tennessee that now rely on the Duck River. He said the seed money is intended to help local utilities form a revenue-producing partnership to build the pipeline. "This project is about a billion dollar project to bring water from the Cumberland River to Southern Middle Tennessee," Bryson said. He said the pipeline would reduce pressure on the Duck River, which he described as "the most biologically diverse river in North America."

Committee questions and follow-up items

Members asked for concrete rules and application procedures on multiple line items. Specific follow-up commitments included:

- Whether utility districts affected by disaster relief can apply to the Governor's Response to Recovery Fund (now increased by $25,000,000 to $125,000,000) for reconstruction and whether the fund covers utility administrative costs related to bonding and loan transactions. - Eligibility and distribution mechanics for the $20,000,000 school safety grants and the $20,000,000 charter schools facilities fund. - Whether general aviation funds can be used by specific airports for runway repaving and maintenance (TDoT will administer applications; Bryson said airports can apply). - More detail on the AOC indigent representation program design and the Memphis schools audit estimate ($3,000,000 estimated cost; procurement and scope to be refined).

Items members specifically asked administration staff to provide in writing included the school-safety grant formula, charter facilities application process, whether utility districts qualify for disaster-related recovery grants, and a breakdown of diaper-support funding lines.

No committee vote was taken on the administration amendment during this presentation; the session served as an overview and Q&A. Bryson and his staff agreed to supply written documentation for committee members.

Ending

Bryson framed the amendment as fiscally conservative and built on slow growth assumptions: a 0% growth rate for FY25 and 2% for FY26. He said the package emphasizes recurring funding where possible, but relies heavily on nonrecurring sources for capital and one-time priorities. Committee members asked for additional documentation and clarification before any formal committee action on the amendment.