Legislative Corner

There is a lot of activity with the Legislature aiming to adjourn by April 17th. As a result, the calendars are loaded with bills and everything is moving at fast-pace. Also, note that the TTA’s Day on the Hill and Legislative Breakfast Reception had to be cancelled due to a snow event and the closing of legislative offices in February. Unfortunately, it may be difficult to reschedule another event during this legislative session.

This is the year of the “immigration bill.” Many bills have been filed which are in conflict with federal laws. We are tracking all of those that directly affect the trucking industry. It is disappointing to see bills filed that have a negative impact on the trucking industry that are filed without any notice by the sponsor. Please be assured that we are monitoring very closely.

SB492/HB1023 sponsored by Senator Janice Bowling (R) and Representative Lowell Russell (R) requires an officer to, among other things, issue an out-of-service order to a driver with a CDL if the officer determines that the driver is unable to read or speak English at a level that is in violation of a federal requirement. Currently the ability to speak English is not as strict as taking the CDL exam in English. Trucking companies and employers would be responsible for penalties and fines . TTA opposes this legislation. As a result of the substantial fiscal note created by the potential loss of federal funds, the House sponsor now has amended the bill to make it a “trigger bill” so that the bill only becomes law should the federal law change to allow for such enforcement. We have drafted an amendment that Rep. Russell has agreed is needed that will remove all employer liability.

SB194/HB0026 by Senator Joey Hensley (R) and Rep Gino Bulso (R) would make it a felony for the prescribing , sale, manufacture , delivery, distribution , etc. of certain drugs that, in addition to treating other medical issues, can induce early abortion. In addition to making it a felony, common carriers would be subject to $5 million in damages in strict liability. TTA is opposing this in conjunction with UPS, FedEx, and other carriers. The liability for common carriers, air carriers, brokers etc. should be removed. This bill is opposed by many medical groups as well.

SB1068/HB972 by Senator Jack Johnson (R) and Representative Jake McCalmon (R) is a re-write of the MOTION ACT passed last year. The bill will streamline parts of the existing statute and tighten some notice requirements for towing of tractor trailers and rental cars. Although TTA was successful in outlawing “booting “ for tractor trailers last year, this year’s bill bans booting for all automobiles in the state. It is a very proactive bill to address an awful abuse of predatory booting and towing activity.

SB419/HB005 by Senator Raumesh Akbari (D) and Representative Gino Bulso (R) would drastically revise the Tort Reform Act of 2013 by expanding caps on damages a plaintiff would be able to recover in a civil action. The bill would increase the amount for noneconomic damages from $750,000 to $1.5 million and increase the amount for catastrophic cases from $1 million to $2 million. TTA along with other groups are opposing this bill and we are monitoring very closely.

February Recap: State of the State, Budget Presentations Highlight 2025 Session

On Monday February 10, Governor Bill Lee addressed a joint meeting of the General Assembly for his penultimate State of the State address. Welcomed into a packed House chamber with raucous applause, the Governor reflected on Tennessee’s achievements and outlined his remaining priorities for 2025. The Governor was particularly ebullient and grateful given that just a few weeks ago the legislature passed his top remaining legislative priority—an expanded Educational Savings Account plan—bringing universal school choice to Tennessee families.

In outlining his vision, Governor Lee said “we are standing in the arena in a pivotal time for our state and our country,” noting that while his 2024 address maintained it was time for Tennessee to hold its place in America, he believes 2025 is a year to think bigger, alluding to the partnership with the Trump administration.  The Governor used that to frame his central theme, that Tennessee should become the nation’s capital of innovation. “Somebody has got to determine what the future looks like. And that should be Tennessee,”  he said.

Governor Outlines Top Remaining Priorities:  Infrastructure, Environmental and Land Conservation, Nuclear Energy

In terms of top line priorities, Governor Lee highlighted three areas: infrastructure, conservation, and energy. The Governor praised the innovative approach of the 2023 Transportation Modernization Act, which introduced “choice lanes” for the first time in Tennessee. He then announced an even stronger commitment with a proposed $1 billion appropriation to TDOT for building and maintaining roads and bridges statewide.

Governor Lee also devoted several minutes to address the importance of conservation. He announced an effort to protect and preserve the Duck River – the most biologically diverse freshwater river in North America, and a sole water source for 250,000 Tennesseans – and $100 million to create a regional water supply strategy for the Duck, which will also include a large pipeline running from the Tennessee River in West Tennessee to areas currently served by the Duck, in order to alleviate the pressure currently on the Duck by having to serve so many cities and towns.  The Governor also proposed the Farmland Conservation Act, an effort to curtail the 10 acres of farmland that Tennessee loses every hour.

In addressing the country’s looming energy crisis, Lee highlighted Tennessee’s ability to become the nation’s leader in confronting the energy problem. He proposed an additional $10 million appropriation to Tennessee’s nuclear energy fund, which has already attracted major nuclear companies and led to a number of them to locate facilities in East Tennessee. Lee also noted that the Tennessee Valley Authority has applied for an $800 million federal grant to develop the Clinch River Site in east Tennessee and announced a proposed $50 million contribution by the state, all in an effort to build the state’s first small modular reactor.

Other Budget Highlights:

Perhaps the biggest highlight of any State of the State is the Governor’s specific legislative and budget proposals. Those include the following:

Affordable & Accessible Childcare: To support middle and low-income working families and help them avoid the benefits cliff, $6 million will expand the Smart Steps Childcare Assistance program, while $7 million is allocated to boost pay for childcare workers through the Child Care WAGES program.
Investment in Education: A total of over $580 million will be allocated to support public K-12 education, marking a significant investment in Tennessee’s students, teachers, and schools.
Focus on Workforce Development: $12 million will be allocated to strengthen the skilled workforce through the new TennesseeWORKS Scholarship. This scholarship will cover full tuition, fees, and necessary tools for students training for skilled trades.
Conserving Tennessee’s Outdoor Heritage: Over $280 million has been allocated to conserving the outdoors, including the creation of 5 new state parks, farmland conservation, and preservation of the Duck River.
Fiscal Responsibility / Rainy Day Fund: Governor Lee announced a $35.6 million investment in Tennessee’s Rainy-Day Fund, nearly $16 million more than last year’s investment. This will bring the state’s reserves to over $2.2 billion.
Increase in State Police: The Governor has allocated $24 million in recurring dollars to add 100 new state troopers, raising the total number of state police officers to 1,044.
Making Homeownership Accessible for Tennesseans: $60 million will be dedicated to establishing the Starter Home Revolving Loan Fund, aimed at facilitating the construction of affordable starter homes, particularly in rural communities. Additionally, $30 million will be allocated to the Rural and Workforce Tax Credit, simplifying the process of developing homes and businesses in these regions.
Disaster Relief: Building on the $450 million already allocated for disaster relief during the special session, $4 million will fund a new weather-monitoring system, the Mesonet. Another $3 million will enhance TEMA’s regional response vehicles.
Investment in Tennessee Roads: $80 million in recurring funds and $1 billion in non-recurring funds will be invested to speed up the completion of existing roadway projects. This funding will also support the addition of new critical projects and boost effectiveness of statewide partnership initiatives.
Tennessee Refunds $1.28 Billion in Franchise Tax Payments

Tennessee has refunded $1.28 billion in franchise tax payments to businesses, following last year’s major legislative initiative aimed at resolving disputes over the state’s tax structure. Despite the hefty $1.55 billion fiscal note, lawmakers insisted the legislation was necessary to prevent potential costly lawsuits.

During the Department of Revenue’s budget hearing in Senate Finance Committee on Tuesday, February 25, Commissioner David Gerregano revealed that the state has refunded $1.28 billion to date, and $150 million is being held for final claims, with $11 million set aside for businesses in eight counties impacted by Hurricane Helene. These businesses have until May 1, 2025, to submit refund claims.

A vigorously debated key provision in last year's franchise tax legislation requires the Department of Revenue to publicly list businesses receiving refunds along with general refund amounts. The law requires these details be publicly available for 30 days, from May 31 to June 30, 2025. Commissioner Gerregano confirmed that all names will be posted by May 1, 2025, when refunds are expected to be fully distributed.

Campaign Finance Debate

In light of a significant rise in outside political spending during the 2024 elections, Tennessee lawmakers are considering eliminating campaign contribution limits for political parties and caucuses.

Sen. Richard Briggs (R-Knoxville) and Rep. Tim Hicks (R-Gray) have introduced SB229/HB653, a bill that would lift contribution caps for political party and caucus PACs. The sponsors argue that this change is necessary to combat the growing influence of “dark money” groups, which often conceal their donors’ identities. The debate was sparked by the massive spending of national conservative groups during Tennessee’s 2024 elections, where outside PACs outspent the Senate Republican Caucus by a 50-to-1 margin. This spending is believed to have contributed to the defeat of two incumbent Republican Senators.

The Bureau of Ethics and Campaign Finance supports lifting contribution limits, arguing that political parties should be allowed to coordinate directly with candidates. However, some warn that doing so could consolidate political power further into the hands of party leadership and wealthy donors.

This debate over comes amid growing concerns about political contributions and transparency, heightened by the recent legal issues of former state senator Brian Kelsey (R-Germantown). Kelsey, once a prominent figure in Tennessee politics, was sentenced to 21 months in prison last year after pleading guilty to federal campaign finance violations related to his failed 2016 congressional bid. Prosecutors found that Kelsey funneled hundreds of thousands of dollars in illegal contributions, violating federal election laws.

The Senate State and Local Government Committee debated the bill on Tuesday, February 25 where it passed out in an 8-1 vote and is set to be heard next in Senate Finance, Ways and Means. The House Elections and Campaign Finance Subcommittee passed the measure in a 7-0 vote, and the bill is set to be heard in the State and Local Government Committee on Wednesday, March 5.