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Gov. Lee Marks the Close of the 2026 Legislative Session
NASHVILLE, Tenn. – Today, Tennessee Governor Bill Lee marked the close of his final legislative session, which includes the successful passage of his $58.3 billion budget focused on strategic investments to strengthen Tennessee’s future.
“When I first became Governor, I was hopeful about what we could accomplish in partnership with the General Assembly to serve Tennesseans,” said Gov. Lee. “Over eight legislative sessions, we’ve passed strategic measures to invest in education, strengthen our workforce, improve infrastructure, and secure our state’s position as a leader in next-generation nuclear energy. We’ve accomplished much together, and I’m deeply grateful to the members of the General Assembly who have worked alongside us to deliver real results for people across our state.”
Lee’s agenda included an expansion of the Education Freedom Scholarship program, delivering quality educational choices to more Tennessee families by increasing the total number of scholarships to 35,000.
The legislative agenda also prioritized expanding access to healthcare and reducing barriers to care, particularly in rural communities, through scope of practice reforms and Certificate of Need (CON) modernization. The FY26-27 budget includes significant investments in K-12 education, Tennessee’s nuclear energy ecosystem, and conservation, positioning the state for continued growth and opportunity.
Notably, Lee’s budget further reinforces Tennessee’s legacy of conservative fiscal stewardship by investing in the state’s Rainy Day fund, bringing reserves to the largest level in state history.
Highlights from Lee’s agenda include the following:
Economic Opportunity
Public Education Investments
“When I first became Governor, I was hopeful about what we could accomplish in partnership with the General Assembly to serve Tennesseans,” said Gov. Lee. “Over eight legislative sessions, we’ve passed strategic measures to invest in education, strengthen our workforce, improve infrastructure, and secure our state’s position as a leader in next-generation nuclear energy. We’ve accomplished much together, and I’m deeply grateful to the members of the General Assembly who have worked alongside us to deliver real results for people across our state.”
Lee’s agenda included an expansion of the Education Freedom Scholarship program, delivering quality educational choices to more Tennessee families by increasing the total number of scholarships to 35,000.
The legislative agenda also prioritized expanding access to healthcare and reducing barriers to care, particularly in rural communities, through scope of practice reforms and Certificate of Need (CON) modernization. The FY26-27 budget includes significant investments in K-12 education, Tennessee’s nuclear energy ecosystem, and conservation, positioning the state for continued growth and opportunity.
Notably, Lee’s budget further reinforces Tennessee’s legacy of conservative fiscal stewardship by investing in the state’s Rainy Day fund, bringing reserves to the largest level in state history.
Highlights from Lee’s agenda include the following:
Economic Opportunity
- $20 million investment in Tennessee’s Rainy Day Fund, bringing Tennessee reserves to more than $2.2 billion, the largest in state history
- $8 million to expand the Tennessee Youth Employment Program, creating more opportunities for young adults to gain valuable job skills, especially in underserved communities
- $25 million further investment in the Tennessee Entertainment Commission to fund incentive grants for Tennessee’s music and film industry
- $30 million to support Tennessee zoos which drive educational opportunities and tourism
- $400 million to the Tennessee Department of Transportation (TDOT) to address the state’s infrastructure needs, including expediting existing road projects and funding new projects across rural and urban Tennessee
- $165 million to renovate and replace Tennessee’s rest areas and welcome centers
- $81.2 million to the Transportation Equity Fund to support infrastructure needs for commercial and general aviation
- $20 million to Tennessee Housing Development Agency (TDHA) to incentivize public-private partnerships that develop or rehabilitate workforce housing, prioritizing high-growth, high-cost areas
- $15 million further investment in the Rural Development Fund to improve quality of life in rural communities by supporting business development and infrastructure planning
- $1.5 million to bring more nonstop international flights to Tennessee
- $40 million for bridge reconstruction project in Montgomery County to support Korea Zinc’s $6.6 billion manufacturing investment, the single-largest capital investment in Tennessee history
Public Education Investments
- $339 million to strengthen public education across the state, including further investment in the Tennessee Investment in Student Achievement (TISA) formula funding, summer learning camps, and raising starting teacher pay to $50,000
- $20 million for K-12 facilities and maintenance grants at public schools across Tennessee
- $40 million to support facilities improvements at public charter schools
- $3 million to expand the school-based behavioral health liaison program, giving students across Tennessee schools important resources and mental health support
- $10 million for K-12 safety grants
- $1 million grant to non-profit partner the Niswonger Foundation for a high-dosage, low-ratio tutoring program providing literacy and math instruction to students in grades 1-8
- $500k grant to nonprofit partner CodeCrew to support the expansion of a Shelby County facility that offers hands-on computer science and artificial intelligence education for students
- $1 million grant to nonprofit partner Teach for America to support recruitment and development of teachers serving in high-need schools across the state
- $450k grant to nonprofit partner Governor’s Early Literacy Foundation Imagination Library to support the program’s continued mission of providing free monthly books to children from birth to age five
- $155 million to deliver school choice to even more Tennessee families in the 2026-27 school year by increasing Education Freedom Scholarships by 15,000 additional scholarships, bringing the total number to 35,000
- $350 million to fund construction of a new College of Medicine Interdisciplinary Building at University of Tennessee Health Science Center in Memphis
- $71.7 million to support capital maintenance projects at Tennessee’s higher education institutions
- $10 million further investment in the Governor’s Investment in Vocational Education (GIVE) program to support nuclear workforce education, as recommended by the Nuclear Energy Advisory Council
- $3 million for Next-Gen Academies at Tennessee Tech University for nuclear and cyber technologies
- $39.4 million to fully fund the outcomes-based funding formula, which may be used for program improvements that assist higher education institutions in meeting outcomes including student progression, degree production, research and service, efficiency metrics, and other measures related to institutional mission
- $3.25 million for the Corrections Education Investment Initiative, offering programming and education opportunities for incarcerated individuals and preparing them for reentry success
- $4.5 million grant to non-profit partner tnAchieves to help Tennessee Promise students complete college by providing academic assistance and help with unexpected financial needs
- $205 million in Shared Savings to support healthcare initiatives, including:
- $18 million for the first-in-the-nation Pathway to Independence Program to incentivize employment and assist TennCare members in transitioning to private health insurance
- $125 million for targeted capital projects and to expand the most effective models emerging from the Rural Health Transformation Program
- $20.5 million to account for a growing number of Rural Health Clinics receiving cost-based reimbursement rates
- $230 million to TennCare to cover increasing costs associated with medical inflation, including higher prescription drug prices and Medicare payments, and increased utilization and services
- $34.5 million to Department of Children’s Services (DCS) to assist with reducing caseload ratios
- $10.7 million to enhance staff safety at DCS facilities that accommodate delinquent youth
- $15 million for capital project and maintenance grants to YMCAs across Tennessee
- $24.2 million to continue a Department of Health Dental Pilot Program to address unmet dental service needs and increase the number of dentists in Tennessee
- $10 million grant to non-profit partner Live Like Lou Foundation for ALS research
- $500k grant to non-profit partner The Next Door to assist women in recovery from substance abuse
- $500k grant to non-profit partner The Jason Foundation, which provides educational and awareness programs related to youth suicide
- $250k grant to non-profit partner Families Free, which provides treatment, education, and intervention services to families
- $10 million for pregnancy center grants
- $44.2 million to bolster the Governor’s Response and Recovery Fund which provides support to individuals, businesses, and communities after natural disasters
- $50 million for public safety grants to enhance crime prevention and increase public safety in Memphis
- $83 million to Tennessee Department of Military for construction of a new Army Aviation Support Facility in Rutherford County
- $37.5 million for salary increases and creation of an additional 50 State Troopers and related support staff positions to improve public safety across the state
- $20 million for capital improvements at the West Tennessee and East Tennessee Regional Juvenile Justice Centers
- $1.7 million recurring grants to non-profit partners that combat human trafficking and support survivors
- $1 million recurring grant to non-profit partner Men of Valor, which provides faith-based reentry support for incarcerated individuals
- $250k recurring grant to Lipscomb University’s LIFE Program, which provides higher education opportunities for incarcerated individuals
- $500k recurring grant to non-profit partner Tennessee Prison Outreach Ministry, which provides faith-based reentry support for individuals and their families
- $1.25 million for Houses of Worship Security grants
- $9 million for TBI’s TN Safe Initiative to bolster law enforcement’s efforts to combat gang activity statewide
- $86.6 million to create a total of 14 new state parks under Gov. Lee’s leadership, setting the Tennessee record for the most state parks created by one administration
- $1.6 million for the Subsurface Sewage Disposal Program, reducing waiting times for permitting services and oversight
- $2.5 million to update the Bicentennial Mall History Wall
- $1.1 million to support further enhancement of Tennessee’s electric grid
- $38.5 million to continue Tennessee’s efforts to lead the nation in adoption of artificial intelligence technology and make government work more efficiently for Tennesseans
- $25 million further investment in the Nuclear Energy Fund to attract advanced nuclear technology companies, ensuring Tennessee continues leading the nation as the epicenter of America’s nuclear renaissance
- $20 million to complete the relocation of the North Data Center
- $43 million to accelerate Tennessee’s quantum computing industry by attracting substantial federal and private-sector investment and to translate our scientific strengths into durable, high-wage job creation across advanced manufacturing, life sciences, and logistics industries
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