Utilities, Utility Districts - As enacted, authorizes a political subdivision to enter into a cost-sharing agreement with a developer for the development of certain public infrastructure. - Amends TCA Title 5; Title 6; T, the official text

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                        ~tate of ~ennessee

                         PUBLIC CHAPTER NO. 1028

                                                  HOUSE BILL NO. 2386

                                              By Representative Vaughan

                                       Substituted for: Senate Bill No. 2191

                                                     By Senator Taylor

         AN ACT to amend Tennessee Code Annotated, Title 5; Title 6; Title 7; Title 13; Title 65
and Title 68, relative to infrastructure development.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:

          SECTION 1. Tennessee Code Annotated, Title 7, Chapter 51, is amended by adding the
following as a new part:

          7-51-2801. Part definitions.

                   As used in this part:

                             (1) "Developer" means a developer of real property seeking approval from
                   a political subdivision to construct a private development within the jurisdiction of
                   the political subdivision;

                             (2) "Development" means a private construction project involving the
                    improvement of real property;

                             (3) "Offsite public infrastructure improvement" means a public
                    infrastructure improvement or utility extension beyond the boundary of real
                    property being developed by a developer;

                             (4) "Political subdivision" means a county, municipality, or metropolitan
                   government; and

                             (5) "Public infrastructure" means roads, streets, traffic signals, turn lanes,
                    sidewalks, lighting, stormwater improvements, and utilities, including water,
                   wastewater, electric, gas, and broadband, that will be dedicated to one (1) or
                    more public entities.

          7-51-2802. Cost-sharing agreements for public infrastructure.

                    (a) If a political subdivision of this state determines that an offsite public
          infrastructure improvement is necessary as part of a development project to service
          future development, then the political subdivision may require the developer to construct
          or pay for the construction of such offsite public infrastructure improvements subject to a
          cost-sharing arrangement between the developer and the political subdivision. Such
          cost-sharing arrangement must be based upon the proportionate utilization or impact the
          development for which approval is sought from the political subdivision has on public
          infrastructure.

                    (b) A political subdivision has sixty (60) days from the date on which the approval
          is requested of the political subdivision by which to make a determination.

                    (c) The political subdivision's share of the offsite public infrastructure
          improvement costs may be provided through impact fees collected from other
          developments, bond proceeds, or unencumbered tax revenues.

          SECTION 2. The headings in this act are for reference purposes only and do not
constitute a part of the law enacted by this act. However, the Tennessee Code Commission is
requested to include the headings in any compilation or publication containing this act.
HB2386
          SECTION 3. This act takes effect upon becoming a law, the public welfare requiring it.

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         HOUSE BILL NO. 2386

PASSED:  April 22, 2026

                         CAMEROW-SEXTON,SPEAKER
                         HOUSE OF REPRESENTATIVES

                                          PEAKER OF TH  ALLY
                                                        NATE

1q APPROVED this tJ2... day of CY)o (.,~  2026

    L'huV-< _,,.

BILL LEE, GOVERNOR