HB 114 – SB 1291
FISCAL NOTE
Fiscal Review Committee
Tennessee General Assembly
February 8, 2025
Fiscal Analyst: Laura Moore | Email: laura.moore@capitol.tn.gov | Phone: 615-741-2564
HB 114 – SB 1291
SUMMARY OF BILL: Requires the Department of Military (DOM) to reimburse 100
percent of master’s degree program fees and undergraduate course fees for eligible members of the
Tennessee National Guard under the STRONG Act of 2017 (Act). Increases, from 120 to 130
semester hours, the maximum allowable tuition reimbursement to be paid to an educational
institution on behalf of a member. Removes the Act’s repeal date from June 30, 2025, and places
the Act into perpetuity.
FISCAL IMPACT:
STATE GOVERNMENT
REVENUE General Fund STRONG Act
FY25-26 - $4,141,500
FY26-27 - $4,606,200
FY27-28 & Subsequent Years - > $4,606,200
EXPENDITURES General Fund STRONG Act
FY25-26 $4,141,500 $4,141,500
FY26-27 $4,606,200 $4,606,200
FY27-28 & Subsequent Years > $4,606,200 > $4,606,200
Assumptions:
• The proposed legislation requires 100 percent of master’s degree program fees and
undergraduate course fees to be covered under the Act.
• According to the DOM, these fees are currently reimbursed and the additional language will
codify current practice; therefore, there is no additional cost for such fees.
• This legislation allows for an additional 10 semester hours to be reimbursed per member.
• Tuition reimbursements under the Act are expended from a dedicated fund created in
FY17-18 with an initial appropriation of $8,959,000.
• As provided by the DOM, the following executions have been made under the Act since
FY17-18:
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Fiscal Year Appropriation Carry Forward Expenditures Fund Balance
FY17-18 $8,959,000 $628,100 $8,330,900
FY18-19 - $1,254,100 $7,076,800
FY19-20 - $1,571,700 $5,505,100
FY20-21 - $2,529,100 $2,976,000
FY21-22 - $2,340,800 $635,200
FY22-23 $3,000,000 $3,231,600 $403,600
FY23-24 $3,000,000 $468,900 $3,477,400 $395,100
FY24-25 $3,500,000 $624,900* -
* as of 2/6/2025 still executing
• The carry forward amount listed for FY23-24 represents transfers from other funds within
the DOM into the Act’s fund in order to meet obligations.
• Based on information provided by the DOM, in FY23-24, approximately 700 national
guard members utilized the Act, with the majority enrolled in undergraduate courses at the
University of Tennessee (UT).
• It is estimated that 25 percent, or 175 (700 x 25%) guard members, will be reimbursed for
one additional course annually under the proposed expansion of 10 additional hours, as the
required curriculum for many undergraduate degree programs now exceeds 120 credit
hours.
• The average course offered by public institutions of higher education is three credit hours.
• According to information provided on UT’s website, the total in-state cost for three credit
hours including tuition and fees for the spring 2025 semester is $1,506.
• The Tennessee Higher Education Commission set a binding 0-5.5 percent tuition and fee
range for the 2024-2025 academic year. For purposes of this analysis, an average of two
percent per year in tuition increases is assumed for FY25-26 and future years.
• Expanding the number of allowable tuition reimbursement hours is estimated to increase
expenditures under the Act by $268,821 [(175 members x 1 course x $1,506) x 102%] in
FY25-26, and $274,197 ($268,821 x 102%) in FY26-27. The increase in expenditures
related to the expansion of allowable hours is assumed to exceed $274,197 in FY27-28 and
subsequent years, as the number of guardsmen and tuition costs are assumed to continue to
increase.
• Notwithstanding a disruption related to Covid, expenditures for the Act have increased
significantly year over year since enactment. From FY22-23 to FY23-24, reimbursements
increased by 7.60 percent, which is the smallest annual increase since enactment. It is
therefore reasonably estimated that expenditures will increase by at least 7.60 percent over
the next three fiscal years.
• To date, in FY24-25, $624,900 has been expended. Based on an increase of 7.60 percent
from expenditures made in FY23-24, it is estimated that an additional $3,116,782
[($3,477,400 x 1.0760) - $624,900] will be expended in reimbursements in FY24-25, for a
total of $3,741,682 ($624,900 + $3,116,782).
HB 114 – SB 1291 3
• After payment of reimbursements, it is estimated there will be a remaining balance of
$153,418 [($395,100 FY23-24 balance + $3,500,000 FY24-25 appropriation) – $3,741,682
FY24-25 expenditures] within the fund at the close of FY24-25.
• It is estimated that the following will occur in FY25-26 and FY26-27, based on growth in
the Act and expansion of the course reimbursements.
Fiscal
Year
Carry forward
(previous year)
*Current Act
Expenditures
**Expansion of
Reimbursements
Total
Expenditures
Fund
Balance
FY25-26 $153,418 $4,026,050 $268,821 $4,294,871 ($4,141,453)
FY26-27 0 $4,332,030 $274,197 $4,606,227 ($4,606,228)
*Based on 7.60% growth **Based on a 2% annual tuition increase
• The Act is set to repeal at the close of the current fiscal year, on June 30, 2025. The
proposed legislation extends the Act into perpetuity.
• Extending the Act into perpetuity will result in an increase in state expenditures estimated
to be $4,141,453 in FY25-26; and $4,606,228 in FY26-27.
• Participation and the cost of tuition and fees is assumed to continue to increase in future
years; therefore, the increase in state expenditures needed to sustain the program is
estimated to exceed $4,606,228 in FY27-28 and subsequent years.
CERTIFICATION:
The information contained herein is true and correct to the best of my knowledge.
Bojan Savic, Executive Director