Saturday, March 19, 2016

State Legislative update for week ending 3/19/2016

The following is produced by the staff of the State legislature and many state senators and representatives include it in their newsletter to constituents.

Legislation calling for Public Private Partnerships to meet growing transportation needs advances 

Legislation that would provide a framework to allow Private Public Partnership (P3) agreements for certain transportation projects advanced through the Senate Transportation and Safety Committee this week.  The bill aims to improve safety, reduce congestion and increase capacity on Tennessee’s roads, as well as encourage economic growth.

Typically with a P3 agreement, the public sector maintains ownership of the asset but the private partner manages construction, operation, and maintenance through the life of the contract.

Senate Bill 2093 authorizes partnerships between private entities and state and local governments for the private development, redevelopment and operation of transportation facilities.  Transportation facilities are defined, under the bill, to include any mass transit system intended for shared passenger transport services to the general public.

The bill authorizes a state or local government entity, or agencies created by them, to receive, consider, evaluate and accept proposals for a qualifying transportation facility.  It details the procedures for doing so, including that the private entity must first obtain state approval before entering into a comprehensive agreement with the state or local government. The request must also be reviewed by the legislature’s Fiscal Review Committee prior to the agreement to ensure transparency and oversight.  Under the proposal, any project estimated to be over $50 million would require an independent audit to be paid for by the private entity.   This audit will be subject to public disclosure, other than proprietary information.  If any state funds are expended for the purposes of a P3 agreement, it must be appropriated in the general appropriations act.

The bill now goes to the Senate Finance Committee for consideration.

Legislation aiming to cut fraud and abuse in Tennessee’s welfare system approved by State Senate

Legislation aiming to reduce fraud and abuse in Tennessee’s welfare system was approved by the State Senate this week.  The proposal, sponsored by Senator Jim Tracy (R-Shelbyville), makes substantial changes to the way the Tennessee Department of Human Services (DHS) contracts and monitors third-party agencies that receive taxpayer money to feed children and adults.

The legislation comes after comptroller audits and investigations that identified financial mismanagement and fraud within some of the federal food programs administered by DHS.  Approximately $80 million flows through DHS for program services. 

“The Department of Human Services provides services to some of the most vulnerable citizens of our state,” said Senator Tracy.  “This bill ensures that money designated for those in need is spent in the most efficient and effective manner, while at the same time protecting taxpayer money from fraud and abuse.”

Senate Bill 1472 directs DHS to conduct background checks on each applicant of the subrecipient or sponsoring organization.  It also requires sponsoring organizations applying to participate in any food program administered through the department to obtain and maintain a performance bond.  If the contract is awarded, the department must perform both unannounced and announced physical site visits during the subrecipient monitoring process and report their findings.  Similarly, DHS must develop sub-recipient monitoring plans, under the bill, utilizing analytical procedures that must be submitted to certain legislative leaders and the state comptroller on an annual basis.  In addition, the bill requires the inspector general of DHS must submit a report summarizing the results of any substantiated investigations concerning fraud, waste and abuse regarding the child and adult care food program and summer food service program every three months.

The bill is pending action in the Finance, Ways and Means Committee in the House of Representatives.
Legislation protecting Tennessee farms advances in State Senate

Legislation protecting Tennessee’s farming industry advanced in the Senate this week as the Judiciary Committee approved an amendment to the state’s Right to Farm Act.  Senate Bill 2591 clamps down on illegitimate nuisance suits by removing the standard regarding nuisance actions on new types of farming operations.  The bill, which is sponsored by Senate Majority Leader Mark Norris (R-Collierville), requires the same burden of proof for nuisance action for these farms as used in established farming operations.

“If you look at the state seal, the wording most prominent across the middle is ‘agriculture,” said Senator Norris.   “Agriculture remains the biggest business that Tennessee embraces and at the same time, we’re concerned about the continued loss of farm land and farm operations, not only across the United States, but here in Tennessee, as well.  As development expands and land use changes, those in the farming business need to be vouchsafe.  They need to have their heritage and their livelihood, the opportunity to pursue it, preserved.  This bill helps in those efforts.”

The proposal establishes a rebuttable presumption that a farm is not a public or private nuisance unless overcome by a preponderance of the evidence that either the farm does not conform to generally accepted agricultural practices or those set by the Department of Agriculture and the Department of Environment and Conservation.  The bill would not affect legitimate cases of nuisance like the improper use of pesticides, herbicides or disposing of waste improperly.

“This bill removes the standard as it relates to new types of farming operations, simply saying that if you’re farming, you’re farming and you have a rebuttable presumption.  There is no distinction between existing’ and new types of farms,” Norris continued.

“As people decide they want to live in the beautiful bucolic country, they don’t realize that there’s an industry going on there, called agriculture, and this helps to protect that,” added Senator Janice Bowling (R-Tullahoma) who is co-sponsoring the bill.

The measure now goes to the floor of the Senate where it could be scheduled as early as next week.

In other farm news this week, the full Senate approved legislation which gives the Commissioner of Agriculture authority to regulate seeds that are sold, purchased and planted in Tennessee.  Senate Bill 1934, sponsored by Senator Ken Yager (R-Kingston), aims to reduce the risk of potentially harmful seeds from other parts of the world coming into the state.  The bill now goes to the governor for his signature.
Senate passes cybersecurity legislation to protect Tennessee Consumers

Cybersecurity legislation was passed by the State Senate this week tightening up Tennessee’s law regarding breach notification requirements to protect consumers.  The bill is sponsored by Senator Bill Ketron (R-Murfreesboro).

“With more and more personal information stored electronically, there is a growing need to protect personal information, funds and assets,” said Senator Ketron.  “This bill moves Tennessee law forward in adapting to the ever-changing landscape of the cyber world and the threats that come as a result.”

Presently, Tennessee law requires a person, state agency, or business that owns or licenses computerized data that includes personal information to disclose any discovered breach of the security of the system to Tennessee residents whose unencrypted personal information may have been acquired by an unauthorized person.  The law, however, does not affect encrypted information even though a growing number of breaches involve encrypted data as the methods used by criminals become more sophisticated.  The time frame for this notification is also not specified under current law, simply saying it should be made in the most expedient time possible and without reasonable delay.

Senate Bill 2005 specifies that an unauthorized user includes employees of the information holder and that a breach of the security system includes the unauthorized acquisition of all computerized data, whether encrypted or unencrypted. It further requires that the notification requirement to disclose a breach be made immediately, but no later than 45 days from the discovery or notification of the breach or, in the event the disclosure is delayed due to the needs of law enforcement, no later than 45 days after the law enforcement agency determines that the disclosure will not compromise a criminal investigation.

According to the Credit Union National Association, it is estimated that the 2013 Target breach cost credit unions over $30 million and the 2014 Home Depot breach is estimated to have cost even more.  These costs include notifying customers of the breach, reissuing credit and debit cards, closing and reopening member accounts, refunding fraudulent charges, stopping and blocking payments and increasing fraud monitoring.

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