May 11, 2017
With Budget Adopted and Legislative Business Completed, Tennessee General Assembly Adjourns for the Year
The 2017 session of the 110th Tennessee General Assembly adjourned this week on Wednesday, May 10, 2017.  Despite a last minute flurry of activity and controversy involving the state budget and bills placed "behind the budget," both bodies closed out their business with less fanfare than when they convened in January.  The 2018 session of the 110th General Assembly will reconvene at 12:00 noon (CST) on Tuesday, January 9, 2018.  You can read more about some of the last-minute bills that were approved and rejected in this report from Tom Humphrey. 
The Tennessee Chamber staff is working on a comprehensive business analysis of the legislative session that includes bill outcomes, key votes and how the business community fared on a number of issues.  We expect this upcoming edition of our Business Insider publication to reach your inbox or mailbox in the coming weeks, so please stay tuned. 
Lastly, we wanted to extend our sincerest thanks to each of you, our members and Chamber partners, for all of your hard work during the legislative session.  Your efforts in contacting House and Senate members on important legislative issues made a measurable impact and served to visibly elevate the presence and influence of the business community.  With the session now adjourned until next year, it is crucial that you maintain communication with your elected officials on important business issues and, most importantly, THANK those members that supported the business community this year, particularly those who supported the IMPROVE Act.  The opposition will no doubt be talking with legislators now that they are home, so it is more important than ever to weigh in and continue making your voices heard.
This will be the final edition of our weekly Capitol Update for the year, so please do not hesitate to reach out to our government affairs team if you have any questions, thoughts, or ideas about this or next year's legislative session.
Groundbreaking Tennessee Reconnect Act Secures Legislative Approval in Final Day of Session; Heads to Governor's Desk
Tennessee now first state to offer all citizens post-secondary education free of tuition and fees
NASHVILLE - Tennessee Gov. Bill Haslam yesterday thanked the General Assembly for its partnership in making Tennessee the first state in the nation to offer all citizens - both high school graduates and adults - the chance to earn a postsecondary degree or certificate free of tuition and fees and at no cost to taxpayers.
Building off the pioneering Tennessee Promise program, which provides high school graduates two years of community or technical college free of tuition and fees, the Tennessee Reconnect Act establishes a last-dollar scholarship for adults to attend a community college tuition-free.
Tennessee adults without a certificate can already attend Tennessee Colleges of Applied Technology (TCATs) tuition-free under the current Reconnect program. The Tennessee Reconnect Act adds community colleges to the program, funded through the lottery for education account. 
Sales Tax Compliance Legislation is a Hot Topic around the Country

In the last day of session, the Tennessee General Assembly used the omnibus rules bill to stall the department of revenue's effort to collect sales taxes from out of state retail sellers.  Current practices are based on a 1992 US Supreme Court decision and allow the state to collect sales taxes from companies that have a physical presence or "nexus" in the state of Tennessee.  Effectively, companies like Amazon did not have to collect sales taxes until they built their first warehouse facility in the state.
The language adopted by the General Assembly stops the Department of Revenue from enforcing a 2016 rule allowing the collection of sales taxes from companies that have $500,000 in sales in TN but no physical presence.  The language also requires that the Administration come back to the Legislature with recommendations after court challenges on this topic are resolved.  You can read a short article that provides recent updates on current legal challenges and background on the 1992 Supreme Court Case ( Quill Corp v. North Dakota ) here .
Across the country, sales tax compliance legislation has been one of the biggest tax topics addressed by state lawmakers. So far in 2017, lawmakers have introduced 77 such bills in 32 states. While many of these bills are in states that have adjourned or are close to adjourning, the sheer volume of introduced legislation is still instructive. What exactly are these bills trying to do? The purpose of all of them appears to be the same: to promote the collection of sales taxes by as many sellers as possible (including remote sellers) in the absence of congressional action. 
Chamber-backed Early Postsecondary Opportunities Bill Passes House and Senate
A Tennessee Chamber-supported proposal sponsored by Representative Harry Brooks and Senator Jim Tracy seeking to expand student access to early college and postsecondary credit opportunities while still in high school was adopted yesterday by both the House and Senate and now heads to Governor Haslam for his signature. 
As amended, the new law will require, starting with the 2018-2019 school year, local school districts across the state to offer at least four early postsecondary opportunity courses (EPSOs) to their high school students, allowing them to secure some form of college credit before graduating.  These courses can range from the local district's selection of any combination of Advanced Placement (AP), dual credit, dual enrollment, International Baccalaureate, or industry certification courses as defined by the Tennessee Department of Education.  A growing body of research shows that students who earn some form of college or postsecondary credit before graduating high school are significantly more likely to enter college and persist in their postsecondary pursuits, helping bring the state closer to achieving its Drive to 55 goals for a more skilled state workforce.  The new law also brings Tennessee into compliance with its state strategic plan under the Every Student Succeeds Act (ESSA), which calls for more EPSO offerings in the state's high schools.
2017 TNReady Student Testing Declared a Success; Transition to Digital Testing
Back on Track

Chalkbeat reports TNReady's second year - and first full year for grades 3-8 - was a success on both paper and online, according to Tennessee Education Commissioner Candice McQueen.
Now, Tennessee is marching ahead with its plan to test all high school students online next year and to give districts that option for middle schoolers as well.
"With such a successful online administration, we are confident in our plan to move forward ...," McQueen said of the more than 30,000 high school students who tested online this spring in 24 districts.  The non-eventful testing period, which ended on May 5, was a victory for the State Department of Education and its new testing company, Questar. A year ago after Tennessee's online platform failed and a string of problems ensued, McQueen canceled testing in grades 3-8 and fired its previous test maker, Measurement Inc.
The expected transition to digital testing platforms is a critical step in integrating more technology-driven instructional methods in the classroom, thereby better aligning with new workforce skill demands and modernizing test administration in Tennessee. 
And Speaking of Workforce Successes... It Is Gradation Season for the Class of 2017!
The Workforce of Tomorrow Is Here
We all know that April Showers bring May flowers.  It is a good thing, since spring flowers help us celebrate the excitement as students across the state complete another year in their educational pursuits.  For many, this season specifically means high school and college graduations, and of course, mixed emotions from proud families and parents now grappling with the reality of a soon-to-be empty nest at home.  We are excited that we all can share in the joy of the graduation season, and we offer our congratulations to students and their families in the Class of 2017.  
TN Chamber's own Suzie Lusk with her son Cameron,
a 2017 graduate of the University of Tennessee- Chattanooga.

Local Manufacturers Voice Support for Apprenticeships, More Workforce Training at Event Co-Sponsored by Chamber
Business leaders discuss automation, workforce development in changing economy
The Nashville Post reports there aren't enough high-skill workers to sustain a growing domestic manufacturing industry, according to local business leaders assembled at an informational luncheon for manufacturers on Tuesday co-sponsored by Frost Brown Todd, LBMC, Pinnacle Financial Partners and the Tennessee Chamber.
"You've got to start teaching people. Companies have to go back and invest in people," said Jeff Turner (pictured), CEO of Turner Machine Co. "We quit doing that. We started just hiring our competition, we started hiring the best, and we started stealing people. That has to be reinvented - the internships, the apprenticeships, they have to be reinvented."
Doug Alward, an applications engineer with Doerfer Company subsidiary Wright Industries, said Doerfer's Nashville presence has partnered with the local Stratford STEM Magnet High School to create mentorship and apprenticeship opportunities for Nashville high school students.

"One of the things that made that [partnership] successful was the combination of the academia and industry working together. I think with respect to secondary education right now, that's a huge void," Alward said. "We're not doing our job bringing apprenticeships back or working with the local schools and bringing them in and letting them work in our shop paid.
The speakers also considered how automation will fit into the changing economy, including its impact on workers.
Tennessee Cybersecurity Conference
June 21, 2017 
8:30 a.m.-1:30 p.m.
Sheraton Downtown Nashville 

The Tennessee Chamber of Commerce & Industry, in partnership with the U.S. Chamber of Commerce, is hosting a Cybersecurity Conference that brings together top experts both locally and nationally from government, law enforcement, and the private sector to help business leaders develop, evaluate, and strengthen their cybersecurity programs.  

USDA Reorganization Will Help Promote US Food, Goods Internationally Farmers Know the Benefit of Trade  
Agriculture Secretary Perdue writes in the Wall Street Journal (5/10) that the USDA is undergoing a reorganization that includes creating a new undersecretary for trade and foreign agricultural affairs, whose responsibility is promoting US food and goods throughout the world. The reorganization will house the Foreign Agricultural Service under the new undersecretary of trade, and domestic agencies such as the Farm Service Agency and the Risk Management Agency will be overseen by the undersecretary of farm production and conservation. Perdue adds that the Rural Development agencies will report directly to him to ensure rural Americans get the proper attention.

U.S. Chamber's Donohue:
DC should listen to business leaders
In an op-ed published at (5/8), U.S. Chamber President and CEO Tom Donohue writes that the U.S. Chamber recently "invited hundreds of businesses to share their ideas on how to boost economic growth in a series of meetings across the country."  Donohue says there were five key takeaways, including: businesses are optimistic about the future with a businessman in the White House; tax and regulatory burdens continue to impede business growth and success; finding qualified workers is the single biggest challenge facing business; business people have a true passion for our free enterprise system; and businesses expect Washington to produce results, and are ready to engage with political leaders to get things done.

'New regs for unemployment drug tests, mortgage lending rules'
(The Hill) -- reports, "The Labor Department is officially removing the Obama-era rule limiting states' ability to drug test for unemployment benefits from the regulatory rule-book."  In other news, "the Consumer Financial Protection Bureau is reviewing the mortgage servicing rules under the Real Estate Settlement Procedures Act that was amended under the Dodd Frank Wall Street Reform Law."

Know an extraordinary volunteer age 50 or older?
Show your appreciation by nominating him or her for the
2017 AARP Tennessee Andrus Award for Community Service.
AARP's most prestigious Tennessee volunteer award recognizes individuals who are sharing their experience, talent and skills in ways that significantly enrich the lives of others. The Tennessee winner will receive a $5,000 prize, which will be donated to an eligible nonprofit of the winner's choice! Only one Tennessee individual or couple is selected each year.
The nomination deadline is June 2, 2017.
For more information, eligibility requirements and nomination forms, visit or call 1-866-295-7274.

AARP Tennessee  
150 4th Ave. N., Suite 130
Nashville, TN 37219
Phone: 1.866.295.7274

We also wish y'all a Happy Mother's Day!

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The Capitol Update is written by the Chamber's government affairs staff and is distributed statewide to all of our business, local chamber and economic development professionals.  The Tennessee Chamber Capitol Update is a powerful grassroots communication tool and we encourage you to share this publication with your team members to provide crucial updates and engage your local elected officials on important issues.