NASHVILLE (AP) - Tennessee should hold a $28 million general fund surplus in reserve in case state tax collections drop, state Finance Commissioner Mark Emkes said Monday.

Emkes is Gov. Bill Haslam's chief Cabinet officer and said in an interview with The Associated Press that showing such restraint could help bolster the state's case for keeping its high credit ratings.

"Let's be prudent," Emkes said. "Just because we have a little extra change in our pocket, let's not go run out and spend it."

The volatility of the national economy could seriously affect Tennessee revenues, Emkes said.

"We all know what's happened in the month of August with regard to the debt ceiling, the stock market and the uncertainty," he said. "I am very concerned about the sales tax revenue figures for August and the next couple of months based upon consumer confidence and the uncertainties that are out there."

The wait-and-see approach isn't sitt ing well with everyone in the Legislature. Democratic House Minority Leader Craig Fitzhugh of Ripley said lawmakers have already agreed to replenish the state's cash reserves in this year's budget, and that other options like tax refunds should be examined.

Emkes headed a delegation of state officials who met with ratings agencies Moody's and Fitch in New York late last week. The presentations on Tennessee's fiscal situation came as states seek to head off negative effects of Standard & Poor's recent downgrade of U.S. government debt and future cuts in federal spending.

While the agencies didn't indicate whether they would change Tennessee's rating, Emkes said the state has a strong case to make.

"We've told them time and time again that if we receive less money from the federal government, we have the political will to make those spending cuts," Emkes said. "We've done it in the past, and we'll do it in the future if necessary."

Emkes said Moody' s officials lauded the state's management of TennCare expenses, a clear change from when the expanded Medicaid program threatened to bankrupt the state a decade ago.

"They told us that in the past TennCare was a barrier, and TennCare is now a tremendous achievement," he said. "In other words, they realize that we offer a good service to the citizens of Tennessee, but we've controlled the costs."

Former Democratic Gov. Phil Bredesen cut 170,000 adults from TennCare and reduced benefits to thousands more to bring spending under control during his two terms as governor that ended in January. TennCare costs dropped by about $1 billion between 2005 and 2009, but still make up about a quarter of the state budget.

Haslam, a Republican, avoided having to make another series of deep TennCare spending cuts this year when lawmakers passed a $450 million hospital assessment fee designed to draw down another $870 million in federal matching funds.

Fitzhugh, the Hou s e Democratic leader, said he finds it unfortunate that TennCare is often targeted for cuts amid budget pressures. The 1.2 million enrollees are among "those who can least afford" a reduction in services or more expenses, he said.

Haslam did not attend last week's preliminary meetings with credit ratings agencies, but plans to head the delegation to New York for the state's formal presentations next month.

"The governor is going to be leading the effort in September," Emkes said. "He's one of the best salesmen I've ever met in my life ... and we've got a very strong argument."