It’s budget amendment week in Tennessee! (UPDATED)

Gov. Bill Lee is scheduled to present his annual budget amendment this week, usually a sign that the legislative session is nearing its end. The updated spending plan comes at a complicated time for policymakers given the influx of federal COVID-19 relief funds and the prospect of even more money from President Joe Biden’s infrastructure package.

Lee in a speech to the Tennessee Chamber of Commerce last week hinted that a tax cut will be part of his budget amendment. Though details remain scarce, it will be interesting to see how the Lee administration tries to thread the needle on meeting federal guidance that money from the COVID relief fund can’t be used to fund tax cuts.

UPDATE: The Tennessean reports Lee plans to propose a two-week sales tax holiday on food purchased at restaurants and supermarkets. The proposal is estimated to cost $100 million in forgone revenue.

Attorney General Herbert Slatery and his counterpart from Kentucky have filed a lawsuit seeking to undo the strings attached to the federal funds.