February 10, 2009

Finance Commissioner of Tennessee Dave Goetz said Tuesday that the state could receive as much as $4.3 billion under the House version of the economic stimulus bill before Congress.

Goetz provided lawmakers with figures from both the House and Senate versions, the latter of which would give the state about $3.1 billion.

However, Goetz said the state also has a plan in place in case it doesn’t receive any stimulus money. It would have to make about $900 million in cuts for the budget year that begins July 1.

Administration officials have said stimulus money could ease those cuts. Still, they warn there are certain restrictions on how the money would be used, and it has to last over two years.

“It’s non-recurring money and we have to be responsible,” Goetz said.

Gov. Phil Bredesen told reporters in a teleconference Tuesday that the House version of the stimulus bill is “far more generous to the state.”

The Senate voted 61-37 Tuesday to pass an $838 version of the stimulus bill, compared with $819 billion in the House-passed version. Now President Barack Obama’s recovery plan is headed to difficult House-Senate negotiations amid Obama’s calls for a completed version by the weekend.

Bredeson said the Senate version makes deep cuts to local governments. But the governor said he can’t be too picky in a rapidly deteriorating economy.

“Any money they can send to help us through this is very welcome,” he said.

Tennessee, like many other states, is trying to position itself to best utilize its expected stimulus money.

Tennessee’s tax collections have fallen nearly a half-billion dollars short of expectations through the first six months of the current budget year. Sales taxes, which account for two out of every three tax dollars collected in Tennessee, have missed projections by $281 million since July.

Goetz said the state is on pace to record a shortfall this year topping $1 billion, which could mean laying off hundreds of state employees. About 1,500 state workers accepted voluntary buyouts in August.

“The economy is not showing signs of recovery,” he said. “Everything we can do to reserve cash and pull cash from other sources, we are proposing.”