(The Center Square) – The Tennessee General Assembly is beginning to look at the state budget and what is going on in Washington needs to be considered, the chairman of the Senate Ways and Means Committee said Monday.
The committee reviewed the Tennessee 2024 Annual Comprehensive Financial Report, which showed the state’s net position increased by $2.1 billion for fiscal year 2025. The increase was down from the previous year, when the position increased by $6 billion.
The decrease was attributed in part to a reduction in federal dollars flowing through the state.
Chairman Bo Watson, R-Hixson, said as the budget process moves forward, lawmakers need to keep an eye on what’s happening on the federal level.
“This committee needs to be very sensitive to the changes in federal dollars that may or may not be coming into the state and in a number of budget hearings we are going to hear conversations about, ‘well we are going to have this money because we can match potential federal dollars,'” Watson said. “Well, with what all is going on in D.C. right now, whether those federal dollars are going to be there or not is at least open to conjecture at this point since we’ve seen a freeze on federal funding in a number of areas already.”
The Trump administration’s Department of Government Efficiency, also known as DOGE, is scrutinizing federal spending.
Lawmakers are delving into Gov. Bill Lee’s $59.5 billion budget that includes $3.9 billion in new spending. The budget does not have any tax breaks. Both parties filed bills this session calling for the elimination of the grocery tax.
