Taxes, Real Property

AN ACT to amend Tennessee Code Annotated, Title 48 and Title 67, relative to real property taxes.

Taxes

Active

The official status still shows this bill as active or still awaiting another formal step.

Sponsor: Watson, Todd
Last action: 2026-04-09
Official status: Enrolled and ready for signatures
Effective date: Not listed

Plain English Breakdown

The official source material does not specify what happens if a chief executive officer objects to an agreement.

Real Property Tax Amendments

This bill adds requirements for special purpose corporations entering into PILOT agreements with lessees and mandates notifications to taxing jurisdictions if these agreements would reduce tax payments.

What This Bill Does

Adds rules for special purpose corporations when making PILOT agreements that lower tax payments.
Requires the corporation to notify chief executive officers of taxing jurisdictions if a proposed agreement would result in less taxes being paid.
Gives chief executives up to 10 days to respond with approval or disapproval of the agreement.
Makes any PILOT agreement entered after July 1, 2026, without following these new rules void and unenforceable.

Who It Names or Affects

Special purpose corporations that enter into PILOT agreements
Taxing jurisdictions receiving notifications about proposed PILOT agreements

Terms To Know

PILOT agreement: A payment in lieu of taxes agreement where a corporation pays money instead of property taxes.
Special purpose corporation: A company created for a specific public purpose, often related to economic development or infrastructure projects.

Limits and Unknowns

The bill does not specify what happens if the chief executive officer objects to the agreement.
It is unclear how this will affect existing PILOT agreements before July 1, 2026.
The bill summary and text do not provide details on the effective date or implementation timeline.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HA1009

Amendment 1-0 to HB0890

Plain English: The amendment changes how municipalities can delegate authority to corporations for negotiating payments in lieu of property taxes with lessees, adding requirements for notice and approval from taxing jurisdictions.

Municipalities may now delegate the authority to negotiate tax payment agreements to corporations, but only if it serves public purposes as defined by the municipality's legislative body.
Corporations must notify chief executives of taxing jurisdictions before entering into such agreements, unless the agreement would not reduce taxes compared to what is normally due.
Taxing jurisdictions have ten days to respond with approval requirements or objections; otherwise, corporations can proceed with the agreement.
Agreements made after July 1, 2026, without following these new rules are invalid.

The amendment text is complex and includes technical legal language that may be hard to interpret fully without additional context.

SA0895

Amendment 1-0 to SB1398

Municipalities may now delegate the authority to negotiate payments in lieu of property taxes to corporations, but only if it serves public purposes as defined by the municipality's legislative body.
Corporations must notify chief executives of taxing jurisdictions before entering into agreements that would reduce tax payments, and these chiefs can require approval from their legislative bodies.
If a chief executive does not respond within 10 days to a corporation’s notice about an agreement, the corporation may proceed with the agreement.

The amendment text is detailed and technical, making it challenging to summarize all nuances without oversimplifying.

Bill History

2026-04-09 Tennessee General Assembly
Enrolled and ready for signatures
2026-04-09 Tennessee General Assembly
Passed H., Ayes 78, Nays 10, PNV 3
2026-04-09 Tennessee General Assembly
Am. withdrawn. (Amendment 1 - HA1009)
2026-04-09 Tennessee General Assembly
Subst. for comp. HB.
2026-04-09 Tennessee General Assembly
Comp. SB subst.
2026-04-08 Tennessee General Assembly
Rcvd. from S., held on H. desk.
2026-04-06 Tennessee General Assembly
Engrossed; ready for transmission to House
2026-04-06 Tennessee General Assembly
Passed Senate as amended, Ayes 33, Nays 0
2026-04-06 Tennessee General Assembly
Senate adopted Amendment (Amendment 1 - SA0895)
2026-04-02 Tennessee General Assembly
Placed on Senate Regular Calendar for 4/6/2026
2026-04-02 Tennessee General Assembly
H. Placed on Regular Calendar for 4/9/2026
2026-04-01 Tennessee General Assembly
Placed on cal. Calendar & Rules Committee for 4/2/2026
2026-04-01 Tennessee General Assembly
Rec. for pass. if am., ref. to Calendar & Rules Committee
2026-03-25 Tennessee General Assembly
Recommended for passage with amendment/s, refer to Senate Calendar Committee Ayes 8, Nays 0 PNV 0
2026-03-25 Tennessee General Assembly
Placed on Senate State and Local Government Committee calendar for 3/25/2026
2026-03-25 Tennessee General Assembly
Placed on cal. State & Local Government Committee for 3/31/2026
2026-03-25 Tennessee General Assembly
Action def. in State & Local Government Committee to 3/31/2026
2026-03-24 Tennessee General Assembly
Placed on Senate State and Local Government Committee calendar for 3/25/2026
2026-03-24 Tennessee General Assembly
Action deferred in Senate State and Local Government Committee to 3/25/2026
2026-03-18 Tennessee General Assembly
Placed on Senate State and Local Government Committee calendar for 3/24/2026
2026-03-18 Tennessee General Assembly
Placed on cal. State & Local Government Committee for 3/24/2026
2026-03-18 Tennessee General Assembly
Action def. in State & Local Government Committee to 3/24/2026
2026-03-17 Tennessee General Assembly
Action deferred in Senate State and Local Government Committee to 3/24/2026
2026-03-11 Tennessee General Assembly
Placed on Senate State and Local Government Committee calendar for 3/17/2026
2026-03-11 Tennessee General Assembly
Placed on cal. State & Local Government Committee for 3/18/2026
2026-03-11 Tennessee General Assembly
Rec for pass if am by s/c ref. to State & Local Government Committee
2026-03-04 Tennessee General Assembly
Placed on s/c cal Cities & Counties Subcommittee for 3/11/2026
2026-03-04 Tennessee General Assembly
Assigned to s/c Cities & Counties Subcommittee
2026-03-04 Tennessee General Assembly
Ref. to State & Local Government Committee
2026-03-03 Tennessee General Assembly
Sponsor change.
2025-05-13 Tennessee General Assembly
Sponsor(s) Added.
2025-02-12 Tennessee General Assembly
Passed on Second Consideration, refer to Senate State and Local Government Committee
2025-02-10 Tennessee General Assembly
Introduced, Passed on First Consideration
2025-02-06 Tennessee General Assembly
Filed for introduction
2025-02-06 Tennessee General Assembly
P2C, caption bill, held on desk - pending amdt.
2025-02-05 Tennessee General Assembly
Intro., P1C.
2025-02-04 Tennessee General Assembly
Filed for introduction

Official Summary Text

ON APRIL 6,
2026, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 1398, AS AMENDED.

AMENDMENT #1 r
ewrites this bill to add to present law concerning delegations of municipal authority to a special purpose corporation for purposes of entering into payment in lieu of taxes (PILOT) agreements with the corporation's lessees.

Present law authorizes a

municipality
to
delegate to a
special purpose
corporation the authority to negotiate and enter into
PILOT agreements with the
corporation's lessees; provided, that such authorization must only be granted upon a finding that such payments are deemed to be in furtherance of the corporation's public purposes
. The
legislative body of the municipality making such delegation may, in its sole discretion, require the corporation to submit any such agreement to the legislative body for its
approval.

This amendment adds that,
if the proposed agreement would result in
PILOT
payments
b
eing made to any taxing jurisdiction that are less than the taxes that otherwise would be payable to such jurisdiction, then the corporation shall not enter into any such agreement until the corporation has given written notice of such agreement to the ch
ief executive officer of each such taxing jurisdiction. Upon receipt of such notice, the chief executive officer may either:

(
1
) Notify the corporation that the agreement must be submitted to the legislative body of that taxing jurisdiction for approval or disapproval; or

(
2
) Notify the corporation that the chief executive officer does not object to the proposed agreement.

If the chief executive officer does not provide a notification to the corporation within 10 days of receipt of the notice
,
then the corporation may proceed to enter into the proposed agreement.

If the chief executive officer requires that the agreement be submitted to the legislative body of the taxing jurisdiction, then the corporation
is prohibited from
enter
ing
into the agreement unless the agreement is approved by such legislative body.

This amendment further provides that
any
PILOT
agreement entered into
by a special purpose corporation under delegated municipal powers
on or after July 1, 2026, without complying with
this amendment's requirements
, is void and unenforceable.

Current Bill Text

Read the full stored bill text

HOUSE BILL 890
By Todd

SENATE BILL 1398
By Watson
SB1398
002242
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 48
and Title 67, relative to real property taxes.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 67-5-701(e)(1), is amended by
adding the following language at the end of the subdivision:
The comptroller of the treasury may provide the estimates to members of the general
assembly via electronic means.
SECTION 2. This act takes effect upon becoming a law, the public welfare requiring it.