A busy week for news. In this issue
- Tennessee General Assembly Passes Budget
- Policy Replay: Encourage Local Govs to Invest in Water Infrastructure
- Strong economic news & low interest rates
- Investments in housing industry advocacy
- Pres. Biden’s 100 day speech & Sen. Scott’s rebuttal
- Links to sign up for Member Savings
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State Adopts FY’22 Budget
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The Tennessee General Assembly is marching towards the end of the 2021 session. Today, the House & Senate adopted a $42.6 billion state budget. Tennessee is fortunate. We are one of a handful of states who are revenue positive. In fact we had a healthy surplus available this year, due to aggressive spending cuts made last year.
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Surplus revenue in the budget is dedicated to one-time spending to shore up long-term liabilities, complete maintenance, and capital projects. An investment of $79 million will be invested to expand local TCAT capabilities and capacity. There are also targeted investments in career & technical education programs like $478,000 to the Tennessee Builders Education Foundation in West TN. Read Governor Lee’s Press Release with budget highlights.
Republican legislative leaders tout the budget bill as a conservative spending plan strategically using the state’s surplus of cash toward projects that will continue to create jobs in future years, while some Democrats noted the state did not prioritize enough additional recurring funding for aid to schools and struggling families.
The Legislature will return to Nashville next week to complete debate on several items that were required to wait until the budget was adopted.
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Policy Replay: Water Infrastructure
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In the months ahead your local governments will be receiving an influx of federal corona-virus relief funding from the American Rescue Plan. Our local governments in Tennessee should receive $20+ billion in funds from the American Rescue Plan stimulus. This is in addition to the $35 billion already committed by five other federal funding packages approved since March 2020. This flood of one-time federal money poses challenges and opportunities for our elected officials to make long-term investments.
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The Big Idea.
Communities should invest these stimulus funds to repair and upgrade their local water and wastewater infrastructure. This is an approved use, and these “invisible” improvements will pay for themselves in the long run. It is better to make the long overdue upgrades today, when funds are available then to wait and have to fix an emergency breakage when money is tight.
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Certainly, water infrastructure investments would be wiser use than spending the majority of the money for services and programs that will only last one year.
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Action Item: HBAT encourages Builders and Associates to speak to your mayor, local alderman, city councilman, and county commissioners on this matter. Press them to commit to spending their portion of the one-time money on capital investments. We believe major water and wastewater improvements will pay dividends for the next 50 years.
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US economy accelerated at a robust 6.4% rate last quarter
(Associated Press) – Powered by consumers, the U.S. economy grew at a brisk 6.4% annual rate last quarter – a show of strength fueled by government aid and declining viral cases that could drive further gains as the nation rebounds with unusual speed from the pandemic recession.
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The nation’s gross domestic product – total output of goods and services – accelerated in the January-March quarter from a 4.3% annual gain in the last quarter of 2020, the government said Thursday. Growth in the current April-June period is expected to be faster still: Some economists say it could reach a 10% annual pace or more, driven by a surge in people traveling, shopping, dining out and otherwise resuming their spending habits.
Economists say that widespread vaccinations and declining viral cases, the reopening of more businesses, a huge infusion of federal spending and healthy job gains should help sustain steady growth. For 2021 as a whole, they expect the economy to expand close to 7%, matching the fastest calendar-year growth since 1984.
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US economic gains have become increasingly evident in recent weeks. In March, employers added 916,000 jobs – the biggest burst of hiring since August. Similarly, retail spending has surged, manufacturing output is up and consumer confidence has reached its highest point since the pandemic began.
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Interest rates held near zero, Fed sees faster growth
(CNBC) – The Federal Reserve on Wednesday kept its easy money policy in place despite an economy that it acknowledged is accelerating.
As expected, the U.S. central bank decided to keep short-term interest rates anchored near zero as it buys at least $120 billion of bonds each month. The latter part of policy is a two-pronged effort to support an economy that grew strongly to start 2021 as well as to support market functioning at a time when 30-year mortgages still go for around 3%.
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In order to advocate for our industry, we must maintain engagement with our state legislators all year long. Our political activity when elected officials are away from their official duties is just as important as when we are arguing for or against legislation. We encourage all Builders to participate in our Housing Industry Political Action Committee.
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HBAT’s legislative efforts help protect the business interests of the men and women who provide housing for Tennesseans. We closely monitor the issues affecting Tennessee’s home building industry, urging lawmakers to take action. When the legislature is not in session, these goals are carried out through the effort of our Housing Industry PAC activities.
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Conflicting Views on Biden’s first 100 days
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DEMOCRATS: President Biden “declared that ‘America is rising anew’ as he called for an expansion of federal programs to drive the economy past the coronavirus pandemic and broadly extend the social safety net on a scale not seen in decades.” (AP) “Taken together, the collection of initiatives that Biden has introduced in his first 100 days in office suggests a breathtaking scope of change sought by a 78-year-old president who spent a lifetime as a more conventional lawmaker. After presenting himself during last year’s campaign as a ‘transition candidate’ to follow the volatile tenure of” President Trump, Biden “has since his inauguration positioned himself as a transformational president.” (New York Times)
REPUBLICANS: Sen. Tim Scott (R-SC) “argued” that Biden is “failing to deliver on his promises in the GOP rebuttal to” the joint address. “While rebuttals typically offer the opposing party a chance to critique the president’s message, Scott’s speech directly called out Biden and his party… offering up praise for the Trump administration and slamming Democrats as divisive.” (CNN) “Well before Biden arrived at the Capitol on Wednesday night, Republicans had laid the groundwork for a narrative rooted in false pledges and creeping ‘socialism.’ The RNC, in news releases and social media posts, dubbed Biden’s opening act ‘100 days of failure,’ and top congressional Republicans piled on.” (Washington Post)
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Healthcare Notice for HBAT Members
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Due to the COVID-19 pandemic, the federal Health Insurance Marketplace is being reopened thru May 15th.
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The HBATBT Health Plan is open for quoting and enrollment, as well.
The HBATBT Health Plan team would like to help you select a policy that meets your needs and budget. Take a look at all your available options before making a decision.
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Builders Make Plans to Get Together
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Spend a few days at the beach networking with other HBA members!
We’ve all been cooped up for too long, let’s reconnect with fellow Builders and HBA members.
Attending the Summer Meeting is a great opportunity to build relationships with members from across Tennessee, learn the latest association and industry developments, and get more involved at the state level. It’s also a chance for some much needed relaxation and fun at the beach.
Registration & Hotel
We are excited to return to Destin’s 5-star luxury resort. The Henderson is Florida’s finest beach resort on the Northwest Gulf Coast. HBAT has a room block reserved at a discounted rate of $265 per night. The room block deadline is May 12, 2021.
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Participate in Member Savings Programs
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Home Builders preach the benefits of doing business with a member. We want you to do business with like-minded people who support our industry. We also encourage you to take advantage of savings by participating in Rebate Programs.
Builders and Remodelers, if you’re not participating in this rebate program, you’re leaving money on the table. Register and claim your rebates www.HBATrebates.com
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NAHB has Additional Savings Programs for Business Savvy Members
Whether it’s a discount on a product or service or a more efficient way to operate, the smart business person is always looking at ways to cut costs and maximize returns.
Through agreements with more than 20 national companies, NAHB offers exclusive discounts on a variety of products and services that can benefit your business, employees and family.
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