NASHVILLE, Tenn. (WTVF) — Tennessee officials now believe the hurricane recovery effort in Tennessee will be the most expensive natural disaster in state history. Lawmakers appear to universally agree, that impacted counties in East Tennessee need significant financial support. Where they strongly disagree is how to pay for it.
"We’re announcing the Helene Emergency Assistance Loan Program — or what we’re calling the HEAL program," said Gov. Bill Lee last week, during a news conference.
The Governor's plan
Under Gov. Lee's plan, $100 million will be loaned to select East Tennessee counties for debris removal, clean water and wastewater improvement efforts. But the money will come from TennCare's budget.
Here's why. Tennessee is the only state in the country to have a Medicaid waiver agreement with the federal government. Under that agreement, any federal funds the state doesn't spend on Medicaid can either be put back into TennCare or be spent on other "health and wellness" programs.
"We’re very proud to be able to have these dollars to be able to support that effort," said Steve Smith, Director of TennCare during Tuesday's Joint Government Operations Committee hearing. "Certainly water, wastewater, debris removal ties directly to the health and welfare of the 180,000 TennCare members that live in those communities."
Smith took credit for the idea. He told lawmakers, Governor Lee implored each member of his cabinet to think creatively on how they could get funds to East Tennessee.
"I think it’s a great use of the shared savings dollars, and I brought this forward and — ultimately it was the governor that chose to use these dollars," Smith testified.
Several Republicans heralded the plan. "The fact that that 100 million dollars is cash on hand is a godsend," said Sen. Janice Bowling, a Tullahoma Republican.
Democrats respond
But Democrats are fuming over the plan.
"The amount is questionable and concerning to start with, but the fact that we’re only loaning it to these communities? We have money to help our brothers and sisters in East Tennessee. Why isn’t that our priority?" said Rep. John Ray Clemmons, who serves as House Democratic Caucus Chair.
Clemmons points to the Rainy Day Fund, $144 million set aside and unused for the Governor's school voucher expansion and other areas in the state's budget as other potential resources for East Tennessee relief.
In contrast, Clemmons says those shared savings from TennCare have been spent previously on diapers for children in need or mental health initiatives.
"Any money that’s pulled out of that program, jeopardizes not only those types of programs, but any others we would like to see," said Clemmons.
The Nashville Democrat also questioned TennCare's Director about what happens to all of the money when the East Tennessee counties eventually have to pay it back.
"Does it have to go back into TennCare. And when it comes back, does it still have those requirements or strings attached?" asked Clemmons during the Government Operations Committee hearing.
"I believe the intent would be for those dollars to come back to TennCare," said Smith.
Clemmons hopes that's true, but is worried those refunds from the counties could be used for anything else the Governor desires.
"Basically launder those funds. Use them in this emergency assistance so they come back with no strings attached to be used for Gov. Lee’s voucher scam or whatever his next legislative agenda item is," said Clemmons.
There is also concern that the East Tennessee counties will have to spend some of their own money to repay the state. While federal disaster money will likely cover most of the funds, it is not expected to cover all of it.
But there's not much state Democrats can do to change the plan. The Governor does not need legislative approval to use those TennCare funds for East Tennessee relief.
Do you have more information about this story? You can email me at Chris.Davis@newschannel5.com.
Fostering Hope provides Christmas for kids in foster care. I'm delighted to see Fostering Hope expand this year to expand their reach to now include kids in Foster care in metro AND foster kids in East TN hard hit by Helene.
-Bree Smith
