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Erik Schelzig

Editor, The Tennessee Journal

Lee to memorialize three service members

Gov. Bill Lee speaks to reporters after a bill signing ceremony in Nashville on May 24, 2021. (Erik Schelzig, Tennessee Journal)

Gov. Bill Lee is scheduled to honor three service members at a Memorial Day service on Friday morning.

Here’s the release from the Department of Veterans Services:

NASHVILLE – Tennessee Gov. Bill Lee, Tennessee Department of Veterans Services Commissioner Tommy Baker and Tennessee Military Department Adjutant General, Major General Jeff Holmes will honor three service members who gave the ultimate sacrifice at the state’s annual Memorial Day service on Friday, May 28, at 10:30 a.m. CDT at the War Memorial Auditorium in Nashville.

United States Army Sergeant First Class Jeremy Wayne Griffin of Greenbrier was killed in action on September 16, 2019 while conducting combat operations in Wardak Province, Afghanistan in support of Operation Freedom’s Sentinel. He was 41 years old. Griffin was a Special Forces communications Sergeant with 3rd Battalion, 1st Special Forces Group who joined the Army in 2004. He was on his fourth combat tour after completing three other combat tours in Iraq and Afghanistan.

United States Army Private First Class Oliver Jeffers of Huntsville was killed in action November 10, 1944 during combat in the Hürtgen Forest of Germany. Following the end of the war, officials were unable to recover or identify Jeffers’ remains, and he was declared non-recoverable in 1951. While studying unresolved American losses in the Hürtgen area, historians discovered a set of unidentified remains in the Ardennes American Cemetery that possibly belonged to Jeffers. In April 2018 his remains were disinterred and were positively identified April 23, 2020. Jeffers was laid to rest in Huntsville, TN October 7, 2020.

United States Navy Fireman Third Class Warren H. Crim of McMinnville was killed December 7, 1941 aboard the USS Oklahoma, while moored at Pearl Harbor, Hawaii. Crim’s unidentified remains were subsequently interred in either the Halawa or Nu’uanu cemeteries in Hawaii between 1941 and 1944 and remained there until June 2015, when the Deputy Secretary of Defense directed the disinterment of unidentified remains associated with the USS Oklahoma. Crim was identified December 8, 2017 and was laid to rest in Smartt, TN October 24, 2020.

Carr campaign update: Candidate responds to HR complaints

Former Rep. Joe Carr in a lengthy Facebook post is defending himself about a series of human resources complaints filed against him when he worked in state government. Carr blames ‘liberal big government bureaucrats’ at the agency that has been run by Republican administrations since 2011.

“It’s been less than 10 hours since I announced I’m running for Rutherford Co. Mayor and already I’m getting phone calls about claims of ‘harassment’ while serving at TDEC as Assistant Commissioner,” Carr writes in the post. “Liberal big government bureaucrats just don’t sleep, do they?”

Carr denies he was pushed out of his job over the complaints.

“If anyone tries to claim that I was forced out of the administration over this, I have no problem releasing the tapes proving otherwise,” he writes. “I left on great terms, was in fact asked to stay, and told to come back anytime.”

Read the whole thing below:

He’s back! Joe Carr making another run for political office

Former state Rep. Joe Carr (R-Lascassas) announces his U.S. Senate bid in January 2013.

Former state Rep. Joe Carr (R-Lascassas) is taking another stab at running for public office. This time it’s for Rutherford County mayor, where incumbent Bill Ketron may be vulnerable after legal problems related to his former insurance business and a $135,000 civil penalty he received for numerous campaign finance violations.

Since leaving the General Assembly, Carr has unsuccessfully run for two different U.S. House seats, the U.S Senate, state Republican Party chair, and the state Senate. He was hired to work in Gov. Bill Lee’s administration after endorsing the Republican during the 2018 gubernatorial primary, but left after about a year. Carr was also a prominent backer of Manny Sethi’s U.S. Senate bid last year. The latter lost to now-Sen. Bill Hagerty of Nashville in the Republican primary.

Report: Feds asked lawmaker if he knew Casada, Cothren were owners of Phoenix Solutions

House Speaker Glen Casada (R-Franklin) checks his phone as he awaits the joint convention to hear Gov. Bill Lee’s first State of the State address in Nashville on March 4, 2019. (Erik Schelzig, Tennessee Journal)

State Rep. Kent Calfee (R-Kingston) tells the Tennessee Lookout’s Sam Stockard federal agents asked him whether he was aware of the roles of former House Speaker Glen Casada and his onetime chief of staff, Cade Cothren, in a mysterious campaign vendor.

“They asked me if I knew Cade Cothren and Glen Casada were owners of Phoenix Solutions,” Calfee told the publication.

The FBI raided the homes and offices of Casada, Cothren, and Reps. Robin Smith (R-Hixson) and Todd Warner (R-Chapel Hill) on the eve of the legislative session in January.

Calfee said FBI agents searched the computer of his assistant, Nadine Korby, who has been placed on administrative leave along with Casada aide Carol Simpson and interim chief of staff, Holt Whitt.

Calfee, a critic of the way school voucher legislation was passed in 2019, told the Lookout he believes the FBI is conducting three investigations, but declined to give specifics.

As first reported by The Tennessee Journal, federal agents had conducted interviews throughout the legislative session of lawmakers who engaged Casada and Smith for political consulting work.

As recently as the last day of the session, state Rep. Jason Zachary (R-Knoxville) told colleagues he had spoken to federal agents in his office. Zachary spent $4,408 with vendor Phoenix Solutions (though he misspelled it as “Phenoix Solutions” on his disclosures), the outfit believed to be at the center of the FBI probe.

Several colleagues have said Smith was a vocal advocate for steering more political work to Phoenix Solutions. She and Casada have both declined to say whether they have an ownership stake in the business.

“They did not tell me I couldn’t disclose the information that we discussed,” Zachary explained to Chattanooga Times Free Press reporter Andy Sher earlier this month, adding “even with my colleagues, I’ve still tried to be very careful about disclosing what we discussed.”

“Everything centered around the investigation with my colleagues, specifically Rep. Casada, Rep. Smith… I did a survey with Glen and it went through the Phoenix Solutions,” Zachary told the paper.

AP: Tennessee leads nation in laws targeting transgender people

Gov. Bill Lee speaks to reporters following his address to a joint convention of the General Assembly on Jan. 19, 2021. (Erik Schelzig, Tennessee Journal)

A flurry of anti-LGBTQ bills have been filed around the country this year, but Tennessee has gone further than any other in targeting transgender people, according to AP reporters Jonathan Mattise, Kimberlee Kruesi, and Lindsay Whitehurst.

From the story:

Lawmakers passed and Republican Gov. Bill Lee signed five new bills into law, consistently dismissing concerns that they discriminate against an already vulnerable population, that some of the laws are unworkable and that they could damage the state’s reputation.

Supporters defend the laws policy by policy, arguing that one protects parental rights, others protect girls and women and one even improves equality. Opponents reject those claims.

[…] Tennessee’s emergence as an anti-LGBTQ leader grows out of a rightward political shift in a state Republicans already firmly controlled. Lee’s Republican predecessor tapped the brakes on some socially conservative legislation, but emphatic GOP election wins fueled by strong support for former President Donald Trump have emboldened lawmakers since then. That’s the political landscape in which Lee is launching his 2022 reelection bid.

Read the whole report here.

One day only: TN constitution to go on display for Statehood Day

The state Capitol on March 16, 2020. (Erik Schelzig, Tennessee Journal)

A release from Secretary of State Tre Hargett’s office:

NASHVILLE, Tenn. – The Tennessee State Library and Archives is celebrating 225 years of statehood on June 1, 2021, with a one-day-only public display of Tennessee’s three original constitutions.

The state’s constitutions, first written in 1796 and revised in 1834 and 1870, will all be on display in the lobby of the new Library and Archives building located at 1001 Rep. John Lewis Way N. on the northeast corner of the Bicentennial Mall State Park in Nashville on Tuesday, June 1 from 8 a.m. to 4:30 p.m. CDT.

In addition to viewing these priceless documents, which the Tennessee Highway Patrol Honor Guard will safeguard, guests can explore the interactive exhibits in the Library and Archives lobby and take a tour of the new building. Library and Archives staff will give tours every half hour from 10 a.m. to 3:30 p.m.

“Tennessee’s three constitutions are the foundation of our state government,” said Secretary of State Tre Hargett. “I encourage my fellow Tennesseans not to miss this opportunity to make history come alive by seeing these irreplaceable documents up close.”

The Library and Archives, a division of the Department of State, is responsible for collecting and preserving books and records of historical, documentary and reference value, focusing on items related to Tennessee. Tennessee’s constitutions are the highest valued and most historically significant items in the collection.

“The Library and Archives strives to be a resource for researchers, historians, librarians, archivists, genealogists, lawyers, students and anyone interested in Tennessee history,” said Chuck Sherrill, Tennessee State Librarian and Archivist. “Our staff is excited to welcome visitors to our new building and to share our state’s three constitutions and other interactive exhibits.”

The Library and Archives is joining Bicentennial Mall State Park and the Tennessee State Museum for a variety of events to celebrate Tennessee’s 225th Statehood Day.

Bicentennial Mall State Park is celebrating Statehood Day and its 25th anniversary on June 1 with a special event at 10 a.m. in the Amphitheater followed by guided tours and educational programs led by park rangers. For more information about the 25th-anniversary celebration, visit tnstateparks.info/BiMall25thAnn.

To celebrate Tennessee’s Statehood, the Tennessee State Museum launched Tennessee at 225: Highlights from the Collection, a self-guided tour and online exhibition showcasing artifacts that tell a story about Tennessee, from its First Peoples to the present day. Learn more at tnmuseum.org/TN225.

The Statehood Day events at the Library and Archives, Bicentennial Mall State Park and the Tennessee State Museum are free. Reservations are not required.

For the latest information from the Library and Archives, follow their social media channels: Facebook: Tennessee State Library and Archives and Instagram: @tnlibarchives and the Secretary of State’s Twitter account: @SecTreHargett.

For more information about the Library and Archives and the other divisions of the Department of State, visit sos.tn.gov.

Tennessee launches app to manage 529 college savings plans

A release from the state Department of the Treasury:

NASHVILLE, TN – The Tennessee Department of Treasury annually recognizes 529 Day to raise awareness of the importance of saving for a child’s future education. May 29 is nationally recognized as 529 College Savings Plan Day, and it’s an excellent time to become a TNStars College Savings 529 account holder!

When you become a TNStars customer, you will have another useful way to put college savings in the palm of your hand, with access to the new ReadySave529 education savings mobile app. TNStars partnered with Ascensus financial services to offer the app, which makes it easier to view your account balance and investment allocation, contribute funds, and see how your savings compare to peers. It also makes it even easier to invite family and friends to make gift contributions to your child’s account.

So, what is a 529 Plan? It’s named after Section 529 of the Internal Revenue Code that authorizes tax-free status for qualified tuition programs. Earnings in 529 plans accumulate on a tax-deferred basis and distributions are not taxed federally when used for qualified higher education expenses. A 529 plan can be used to pay for college costs at any qualified college nationwide.

With TNStars, a parent, grandparent, family member, employer, or friend can make gift contributions to an account. Earnings grow tax-free, and money can be used for tuition and fees, room and board, books, computers and more. The Tennessee Department of Treasury monitors the plan’s investment options and works to keep costs low so families can save even more.

Families can visit tnstars.com to open an online account in minutes with as little as $25. Once you open a TNStars account, the app is available for download in the Apple and Google Play app stores.

“May 29 is an excellent annual reminder of the importance of saving for a child’s future in a 529 college savings account, such as TNStars,” said State Treasurer David H. Lillard, Jr. “With the mobile app, we can provide technology to better connect TNStars customers to their accounts. That’s something worth celebrating on 529 Day.”

Join the conversation about 529 Day and the new app by following TNStars on Facebook, Twitter and Instagram (#529Day).

State Rep. Mike Carter passes away

Rep Mike Carter is sworn in to the 111th General Assembly in Nashville on Jan. 8, 2019. (Erik Schelzig, Tennessee Journal)

State Rep. Mike Carter, whose refusal to sign what he called a “predetermined” ethics report helped hasten Rep. Glen Casada’s departure as House speaker, has died of pancreatic cancer.

Carter, an Ooltewah Republican, made his own bid for speaker after Casada announced he would step down in 2019, but the contest was won by Rep. Cameron Sexton (R-Crossville).

Carter’s cancer was discovered after he was hit by a heavy bout of COVID-19 last year. He missed most of the recently-completed legislative session while undergoing treatment.

Tennessee revenue collections obliterate estimates by $600M in April

The state Capitol on March 16, 2020. (Erik Schelzig, Tennessee Journal)

Tennessee’s general fund revenue collections were nearly $600 million above estimates in April, bringing the state’s surplus to $1.9 billion through the first nine months of the budget year.

Sales tax revenues beat projections by $285 million in April and were 32% higher than the same month last year. Collections reflect economic activity in the previous month.

Online sales tax collections represent 46.5% of all sales tax growth in the state since the beginning of the budget year.

Corporate franchise and excise taxes were $346 million more than expected in April, with a growth rate of 320% compared with last April.

Here’s the full release from the Department of Finance:

Tennessee Department of Finance and Administration Commissioner Butch Eley today announced that revenues for April exceeded the monthly revenues from the same month last year, which was at the beginning of the pandemic’s impact in Tennessee. Overall state revenues for April were $2.5 billion, which is $1.3 billion more than April 2020, and $596.7 million more than the budgeted estimates. The growth rate for all taxes in April was 90.90 percent.

“It’s important to remember that March and April of 2020 were the only two months where the state experienced a negative growth rate for collections during the pandemic, so in an effort to make realistic analysis, we’ve looked at collections for April 2019,” Eley said. “When we compare April of this year to 2020, the growth is 90.90 percent but compared to April 2019, the April growth rate for all taxes is 15.01 percent.

“Sales tax collections continue to reflect strong consumer activity and increased inflationary pressures that are beginning to appear in the cost of goods sold, as reflected in the latest CPI report. State corporate tax revenues greatly outperformed budgeted expectations as well, with many local companies experiencing a growth in earnings despite difficult circumstances. We should also keep in mind that April income tax receipts were lower than budgeted estimates due to a filing extension that moves the tax deadline into next month.

“Prior year month-to-month tax receipt comparisons for this month and the remainder of the year will appear distorted as periods of economic stoppage from the pandemic and the movement of multiple tax filing dates affect reported growth rates.”

On an accrual basis, April is the ninth month in the 2020-2021 fiscal year.

General fund revenues exceeded budgeted estimates by $599.9 million, while the four other funds that share in state tax revenues were $3.2 million less than the estimates.

Sales tax revenues were $284.9 million more than the estimate for April, 40.20 percent more than April 2020, and 31.78% more than April 2019. April sales tax revenues reflect retail business activity that occurred in March. For nine months, revenues are $1.2 billion higher than estimated. The year-to-date growth rate for nine months is 10.60 percent. Remote sales and marketplace facilitator laws contributed $54.9 million to sales tax receipts in the month of April. For nine months, online sales tax revenues represent 46.5 percent of all sales tax growth to the state.

Franchise and excise tax revenues combined were $346 million higher than the budgeted estimate in April, and the growth rate compared to April 2020 was positive 319.30 percent. For nine months, revenues are $765 million more than the estimate and the year-to-date growth rate is 47.22 percent.

Gasoline and motor fuel revenues for April decreased by 0.75 percent compared to April 2020 and they were $2.4 million less than the budgeted estimate of $104.7 million. For nine months revenues are less than estimated by $18.8 million.

Motor vehicle registration revenues were $4.7 million more than the April estimate, and on a year-to-date basis they are $13.6 million more than estimates.

Tobacco tax revenues were $1.5 million more than the April budgeted estimate of $17.5 million. For nine months, they are $9.5 million less than the budgeted estimate.

Hall income tax revenues for April were $58.5 million less than the budgeted estimate. A filing extension was granted for income taxes moving the filing date from April 15, 2021 to May 17, 2021.  (See: https://www.tn.gov/content/dam/tn/revenue/documents/notices/general/gen2102.pdf)

Privilege tax revenues were $14.2 million more than the April estimate, and on a year-to-date basis, August through April, revenues are $72.4 million more than the estimate.

Business tax revenues were $7.9 million more than the April estimate. For nine months, revenues are $35 million more than the budgeted estimate.

Mixed drink, or liquor-by-the-drink, taxes were $1.2 million less than the April estimate, and on a year-to-date basis, revenues are $24.7 million less than the budgeted estimate.

All other taxes were less than budgeted estimates by a net of $0.4 million.

Year-to-date revenues, August through April, are $2 billion more than the budgeted estimate. The growth rate for eight months is 14.72 percent. General fund revenues are $1.9 billion more than the budgeted estimate and the four other funds are $66.2 million more than estimated.

The budgeted revenue estimates for 2020-2021 are based on the State Funding Board’s consensus recommendation of November 26, 2019 and adopted by the second session of the 111th General Assembly in June 2020. Also incorporated in the estimates are any changes in revenue enacted during the 2020 session of the General Assembly. These estimates are available on the state’s website at https://www.tn.gov/content/tn/finance/fa/fa-budget-information/fa-budget-rev.html.

Lottery: Disciplinary action against Action 24/7 is ‘null and void’

The Tennessee Education Lottery Corp. has written a letter declaring its unprecedented suspension of the Action 24/7 sports gaming license to be “null and void.”

The letter comes after a judge in April reversed the Lottery board’s decision to halt all betting with Action 24/7 after it self-reported instances of debit card fraud on its platform. The sportsbook is run by executives of short-term loan company Advance Financial.

The letter acknowledges Action 24/7 has proper internal controls and that there is no active investigation being conducted into its practices. Action 24/7’s license is unrestricted, and it can freely transact with vendors and parties, according to the letter.

“The temporary suspension of Action 24/7’s License, and the disciplinary action undertaken… related to the allegations presented by the TEL Staff to the Board at the Board’s March 19, 2021 meeting, are null and void,” the letter says.

Read the whole letter here:

May 12, 2021

RE: Status of the Sports Gaming Operator License of Tennessee Action 24/7, LLC

To whom it may concern:

This letter concerns the status of the Sports Gaming Operator License (“License”) of Tennessee Action 24/7, LLC (“Action 24/7”). On March 18, 2021, Action 24/7’s License was temporarily suspended on the basis of alleged deficiencies involving Action 24/7 internal controls. On March 19, 2021, at an emergency meeting of the TEL Board (“Board”), the Board ratified the temporary suspension of Action 24/7’s License. On March 26, 2021, the Chancery Court of Davidson County, Tennessee, ordered TEL to reinstate Action 24/7’s License, and TEL reinstated Action 24/7’s License that same day.

By this letter, the Board, the Spo1is Wagering Committee of the Board (“SWC”), and the TEL Staff hereby represent and confirm that, as of the date of this letter:

1. There is currently no active investigation of Action 24/7 being conducted by any of the Board, the SWC, or the TEL Staff regarding the allegations presented by the TEL Staff to the Board at the Board’s March 19, 2021 meeting or the adequacy of Action 24/7’s internal controls.

2. Action 24/7’s internal controls and Action 24/7’s implementation thereof meet the requirements found in the Minimum Internal Control Standards.

3. Action 24/7’s License is fully effective; there are no restrictions on Action 24/7’s License; and Action 24/7 is in good standing with TEL.

4. The temporary suspension of Action 24/7’s License, and the disciplinary action undertaken by any of the Board, the SWC, or the TEL Staff related to the allegations presented by the TEL Staff to the Board at the Board’s March 19, 2021 meeting, are null and void.

5. Action 24/7 is entitled to the full use and benefits of its License, including, but not limited to, the ability to freely transact with other TEL licensees and vendors or other parties.

Sincerely,
/signed/
Alonda W. McCutcheon
Executive Vice President & General Counsel