All Roll Calls
Yes: 195 • No: 1
TennesseeSB 0026114th General Assembly (2025-2026)SenateWALLET
AN ACT to amend Tennessee Code Annotated, Title 7; Title 9; Title 12; Title 13; Title 66; Title 67 and Title 68, relative to infrastructure development districts.
Sponsored By: Sponsor information unavailable
Signed by Governor
Regional Authorities and Special Districts
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Bill Overview
Analyzed Economic Effects
9 provisions identified: 3 benefits, 2 costs, 4 mixed.
Owners can recover property after sale
An eligible person can recover property sold to the host municipality for unpaid district assessments within one year after sale. Recovery requires paying the full debt, interest, taxes paid by the municipality, and required costs and fees. The municipal governing body can accept a smaller settlement when it finds that doing so serves the municipality's interests.
Property owners get assessment relief options
Municipalities must reduce assessments based on estimated costs once actual costs are established. They can set rules for credits, prepayment, and dividing charges when parcels are split; charges can start at different times. Each district must dissolve no later than 30 years after creation. Owners can seek earlier dissolution with signatures representing at least 75% of assessed value on the latest certified municipal tax rolls, or at least 50% of record owners. A separate debt-payment route allows dissolution only after all obligations payable solely from district assessments are fully paid and discharged.
Unpaid district charges threaten property ownership
When an assessment resolution takes effect, the assessment, accrued interest, and collection costs become a lien against the property. This claim ranks ahead of mortgages and other private claims, but behind state, county, and municipal tax liens. Overdue assessments or installments add 1% interest and a separate 1% penalty each month on the amount due. Property taxes, penalties, and interest must be paid before payments are applied to assessments. Assessments are otherwise collected and enforced like property taxes, including property sales for unpaid charges.
Development infrastructure gets long-term public financing
Municipalities can borrow to pay infrastructure costs, reimburse developers, make developer loans, or refinance debt. Costs must appear in the district's creation resolution, and borrowing must follow state public-debt rules. Municipalities can assign revenue-bond issuance to an industrial development corporation or public building authority. Property assessments can secure repayment; pledged collections and interest are held in trust and promptly sent to the issuer. Developer loan rights can also be pledged or assigned to bondholders. Debt, including refinancing, cannot extend beyond 30 years from the first infrastructure borrowing; refinancing cannot exceed the original maximum assessment rate.
Government property charges need separate approval
A host municipality cannot impose district assessments on government-owned property without approval from that government's governing body.
District property owners pay annual charges
District property owners pay annual assessments for infrastructure, impact fees, administration, and district debt. Charges must fairly reflect each property's benefit, with payment timing and methods set in the district's creation resolution. Up to 5% of assessment proceeds can cover administrative expenses; outside administrator costs can also be included. Municipalities must list each property's owner, location, charge, and future payments, updating records yearly and whenever a parcel is split. Recordkeeping costs can also be included, and multi-municipality districts must identify which municipality charges each area.
Owners approve new infrastructure funding districts
Tennessee municipalities can create districts that fund roads, utilities, parking, broadband, and related infrastructure through property assessments. The developer and every proposed parcel owner must sign a petition describing boundaries, costs, and proposed payments. Filed petitions cannot be withdrawn, but technical corrections are allowed. A public hearing must occur 30–45 days after filing, with mailed and posted notice at least 14 days beforehand. Anyone can protest; approval requires a majority vote and consistent resolutions from every host municipality. Districts can include separate areas, but cannot overlap another infrastructure district or a central business improvement district.
Utility providers keep district service rights
The law preserves authorized public and private utility providers' rights to serve district properties. It does not give developers or property owners authority to operate district infrastructure. Construction must follow applicable law. A development agreement can require the developer to transfer infrastructure to the appropriate service provider.
Municipalities pay for yearly district audits
The Tennessee Comptroller or a designee must audit each district's books and financial records every year. The host municipality pays the audit cost. Audits must meet the Comptroller's standards and receive the Comptroller's approval. They must finish as soon as practical after the municipality's fiscal year ends.
Sponsors & Cosponsors
Sponsors
There is no primary sponsor on record.
Cosponsors
Johnson
Affiliation unavailable
Jeff Yarbro
Democrat • Senate
Roll Call Votes
Senate vote • 4/17/2025
FLOOR VOTE: Motion to Concur House Amendment # 2 4/17/2025
Yes: 32 • No: 0
Senate vote • 4/17/2025
FLOOR VOTE: Motion to Concur House Amendment # 1 4/17/2025
Yes: 32 • No: 0
House vote • 4/16/2025
FLOOR VOTE: REGULAR CALENDAR AS AMENDED PASSAGE ON THIRD CONSIDERATION 4/16/2025
Yes: 90 • No: 1
Senate vote • 3/24/2025
FLOOR VOTE: as Amended Third Consideration 3/24/2025
Yes: 32 • No: 0
Senate vote • 3/18/2025
SENATE STATE & LOCAL GOVERNMENT COMMITTEE
Yes: 9 • No: 0
Actions Timeline
Effective date(s) 05/05/2025
5/13/2025Pub. Ch. 357
5/13/2025Signed by Governor.
5/5/2025SenateTransmitted to Governor for action.
4/23/2025SenateSigned by H. Speaker
4/22/2025HouseSigned by Senate Speaker
4/22/2025SenateEnrolled and ready for signatures
4/22/2025SenateConcurred, Ayes 32, Nays 0 (Amendment 2 - HA0433)
4/17/2025SenateConcurred, Ayes 32, Nays 0 (Amendment 1 - HA0397)
4/17/2025SenatePlaced on Senate Message Calendar for 4/17/2025
4/16/2025SenatePassed H., as am., Ayes 90, Nays 1, PNV 3
4/16/2025HouseH. adopted am. (Amendment 2 - HA0433)
4/16/2025HouseH. adopted am. (Amendment 1 - HA0397)
4/16/2025HouseSubst. for comp. HB.
4/16/2025HouseRcvd. from S., held on H. desk.
3/27/2025HouseSponsor(s) Added.
3/24/2025SenateEngrossed; ready for transmission to House
3/24/2025SenatePassed Senate as amended, Ayes 32, Nays 0
3/24/2025SenateSenate adopted Amendment (Amendment 1 - SA0199)
3/24/2025SenatePlaced on Senate Regular Calendar for 3/24/2025
3/21/2025SenateSponsor(s) Added.
3/19/2025SenateRecommended for passage with amendment/s, refer to Senate Calendar Committee Ayes 9, Nays 0 PNV 0
3/18/2025SenatePlaced on Senate State and Local Government Committee calendar for 3/18/2025
3/11/2025SenatePassed on Second Consideration, refer to Senate State and Local Government Committee
1/15/2025SenateIntroduced, Passed on First Consideration
1/14/2025Senate
Bill Text
HA0397 (Substitute)
4/16/2025
HA0433
4/16/2025
Enrolled / Public Chapter
Fiscal Note
Introduced
SA0199
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