Official Summary Text
This bill prohibits zoning authorit
ies
from adopting or enforcing an amendment
, on or after July 1, 2026,
to zoning regulations or zoning map
s
that downzones property.
However, this prohibition does not apply to downzoning necessary
that meets any of the following criteria:
Protect
s
the public from threats to health or safety, including geologic hazards, unstable soil, earthquake fault zones, fire hazard severity zones, or known flood-prone areas
.
Compl
ies
with federal or state law, including the
federal
Endangered Species Act, the
federal
Fair Housing Act, the
federal
Americans with Disabilities Act, or applicable building accessibility standards
.
Prevent
s
or abate
s
a nuisance.
Additionally, t
his bill
does
not prevent the addition of compatible commercial, light industrial, or mixed
-use
zoning overlays,
if
residential capacity is not reduced and modifications are consistent with
other
land use regulations.
"DOWNZONE" DEFINED
As used in this bill, a
"
d
ownzone" means a zoning action, land-use regulation, ballot initiative, or administrative policy that results in
any of the following:
A reduction in permitted density, floor area ratio, building height, lot coverage, build requirements, or other form-based entitlement
.
A regulation that introduces or increases procedural barriers, including new discretionary reviews, conditional use permits, public hearings, or other non-ministerial processes, for projects that previously qualified for by right or administrative approval
.
A regulation that reduces or restricts the lawful use, division, sale, or possession of property
.
The imposition of design standards, objective development standards, specific plans, neighborhood plans, or overlay zones that reduce a parcel's feasible yield or buildable area relative to prior entitlements.
REMEDIES AND COMPENSATION
This bill authorizes property owners whose property is
subject of a
n
uncompensated downzone
to
bring an action to enjoin enforcement, seek declaratory relief, or recover damages for the loss of fair market value.
In
those actions, all of the following applies:
The zoning authority
must
prove by clear and convincing evidence that a health, safety, legal, or nuisance exception applies.
A prevailing property owner, housing developer, or nonprofit organization must be awarded reasonable attorney's fees and costs.
A zoning authority is prohibited from requiring a
n
applicant to indemnify, defend, or hold harmless the authority regarding actions alleging the violation of the applicant's rights or protections.
This bill requires a zoning authority to compensate a property owner if a downzone results in a reduction in fair market value
, which is calculated
as the difference between the fair market value immediately before the adoption and after the enforcement, established through an independent, certified appraisal submitted by the owner.
A j
urisdiction may elect to waive the application of the downzone as it pertains to the subject property
to avoid liability
.
This
waiver
must be made within 60 days of receiv
ing written notice or within the time to answer a legal action, whichever comes first
.
If
waived, the downzone is void with respect to that property.
Current Bill Text
Read the full stored bill text
SENATE BILL 2582
By Harshbarger
HOUSE BILL 2068
By Todd
HB2068
011469
- 1 -
AN ACT to amend Tennessee Code Annotated, Title 5;
Title 6; Title 7 and Title 13, Chapter 7, relative to
zoning.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Title 13, Chapter 7, is amended by adding
the following as a new part:
13-7-701.
As used in this part:
(1) "Downzone" means a zoning action, land-use regulation, ballot
initiative, or administrative policy that results in:
(A) A reduction in permitted density, floor area ratio, building
height, lot coverage, build requirements, or other form-based entitlement;
(B) A regulation that introduces or increases procedural barriers,
including new discretionary reviews, conditional use permits, public
hearings, or other non-ministerial processes, for projects that previously
qualified for by-right or administrative approval;
(C) A regulation that reduces or restricts the lawful use, division,
sale, or possession of property; or
(D) The imposition of design standards, objective development
standards, specific plans, neighborhood plans, or overlay zones that
reduce a parcel's feasible yield or buildable area relative to prior
entitlements; and
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(2) "Zoning authority" means a governmental entity that has zoning or
permitting authority.
13-7-702.
A zoning authority shall not adopt or enforce an amendment to zoning
regulations or a zoning map that downzones property, except as provided in this part.
13-7-703.
(a) This part does not apply to downzoning necessary to:
(1) Protect the public from legitimate threats to health or safety, which
includes regulations necessary to prevent or mitigate conditions that pose an
imminent threat to human life or property, such as geologic hazards, unstable
soil, earthquake fault zones, fire hazard severity zones, or known flood-prone
areas, as defined by local emergency management authorities or applicable
building and fire codes;
(2) Comply with federal or state law, including the Endangered Species
Act (16 U.S.C. § 1531 et seq.), the Fair Housing Act (42 U.S.C. §§ 3601 et seq.),
the Americans with Disabilities Act (42 U.S.C. §§ 12101 et seq.), or applicable
building accessibility standards; or
(3) Prevent or abate a nuisance.
(b) This part does not prevent the addition of compatible commercial, light
industrial, or mixed-use zoning overlays; provided, that residential capacity is not
reduced and the modifications are consistent with the zoning authority's adopted land
use regulations.
13-7-704.
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(a) A property owner whose property is the subject of a downzone and who has
not been compensated pursuant to § 13-7-705 may bring an action for any of the
following forms of relief:
(1) To enjoin enforcement of the downzone;
(2) For declaratory relief; or
(3) To recover damages for the loss of fair market value caused by the
downzone.
(b) The zoning authority has the burden to prove by clear and convincing
evidence that an exception under § 13-7-703 applies.
(c) A prevailing property owner, housing developer, or nonprofit organization in a
court action must be awarded reasonable attorney's fees and costs.
(d) A zoning authority shall not require an application for a project to indemnify,
defend, or hold harmless the zoning authority in any manner with respect to an action
brought by the applicant, or another person, alleging that the zoning authority violated
the applicant's rights or deprived the applicant of benefits or protections provided by law.
13-7-705.
(a) A zoning authority shall compensate a property owner if the adoption or
enforcement of a downzone results in a demonstrable reduction in the fair market value
of the property attributable to limitations on the property's lawful use.
(b) The amount of compensation is calculated as the difference between the fair
market value of the property immediately before the adoption of a downzone and the fair
market value after its enforcement. This valuation must be established through an
independent, certified appraisal submitted by the property owner.
(c) A jurisdiction may avoid liability for compensation by electing to waive the
application of the downzone as it pertains to the subject property within sixty (60) days of
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receiving written notice from a property owner or within the time to answer an action filed
pursuant to § 13-7-704, whichever comes first. If waived, the downzone is void with
respect to that property.
SECTION 2. This act takes effect July 1, 2026, the public welfare requiring it, and
applies to a downzone adopted on and after July 1, 2026.