TSCPA News

Legislative Update - March 17

March 13, 2017

2017 LEGISLATIVE REPORT

March. 17, 2017

Bills and Legislative News Affecting the Accounting Profession

 Comments

The bills on the following list have been identified by TSCPA’s legislative tracker as bills of interest to the CPA profession.  They may be viewed in their entirety at www.legislature.state.tn.us/.  If you have questions or comments, please email tscpa@tscpa.com. 

Key
✔- Legislation with an active status
♦ - Comments
PC - Link to Public Chapter

AUDIT

SB 315 by Gresham/HB 136 by M. White - Local government audit findings. Requires a local government receiving annual audit findings to submit its annual budget and a corrective action plan to the comptroller. Prohibits the comptroller from approving a local government budget with audit findings if the local government fails to submit a corrective action plan to the comptroller. Authorizes sales tax revenue to be withheld from a noncomplying local government. Grants the comptroller discretion to waive certain requirements.

Fiscal Note:            (Dated February 12, 2017) Other Fiscal Impact – The fiscal impact of this bill is a potential temporary loss of use of an unknown but significant amount of sales tax revenue for any local government entity out of compliance with this legislation. Otherwise, any fiscal impact for state and local government is considered not significant.

Senate Status:         State & Local Government deferred on 3/7/2017 to last calendar.

House Status:         Taken off notice in Local Government Subcommittee on 2/14/2017.

SB 406 by Tracy/HB 391 by K. Brooks - Written objections to notice of audit. Increases the period a contracting entity has to file a written objection to a notice of audit from the comptroller from five business days to 10 business days.

Senate Status:         Referred to State & Local Government.

House Status:         Referred to State Government Subcommittee.

ü SB 463 by Bell/HB 436 by McDaniel - Time frame for submission of corrective action plan after audit from comptroller. Requires the officer who is the administrative head of any department, agency, or institution of the state, to submit a corrective action plan to the comptroller of the treasury which addresses the actions taken, or to be taken, in response to each audit finding and related recommendations of the comptroller of the treasury relative to the effective and efficient management of accounts, books, records, or other evidences of financial transactions. The corrective action plan should provide the name or names of the contact person or persons responsible for the corrective action, the corrective action taken or planned, and the anticipated completion date. The comptroller of the treasury shall at any time notify the chairs of the finance ways and means, government operations, and fiscal review committees of the general assembly of any department, agency, or institution’s failure to timely implement such recommendations, to submit the audit report required by subsection (c) of the bill, or to comply with its corrective action plan. Those committees may direct the department, agency, or institution to provide a written statement to the requesting committee explaining why full corrective action has not been taken. If a requesting committee determines that the written statement is not sufficient, that committee may require the department, agency, or institution to appear before the committee.

Senate Status:         Senate passed on 3/6/2017.

House Status:         House passed on 3/13/2017.

Other Status:          Sent the speakers for signatures on 3/13/2017.

SB 878 by Harris/HB 827 by S. Jones - Performance audits of private service providers contracting with the department of children's services. Requires the comptroller to audit the performance of any private provider of services that contracts with the department including an evaluation of provider performance as it relates to outcomes of clients and their families. Requires the comptroller to report its findings to the judiciary committee of the senate and the civil justice committee of the house of representatives.

Senate Status:         Referred to State & Local Government.

House Status:         Referred to State Government Subcommittee.

BUDGET

SB 483 by Norris/HB 511 by Sargent - Appropriations - FY 2016 and FY 2017. Make appropriations for the purpose of defraying the expenses of the state government for the fiscal years beginning July 1, 2016, and July 1, 2017,

Senate Status:         Referred to Finance, Ways & Means.

House Status:         Referred to Finance Subcommittee.

SB 484 by Norris/HB 512 by Sargent - Statutory revisions necessary for implementation of the annual appropriations act. Allows the commissioner of health to direct funds in the health access incentive account to programs relative to prevention initiatives, efforts to improve the built environment, and strategies to improve the health of the population. Makes statutory revisions necessary to implementation of the annual appropriations act.

Senate Status:         Referred to Finance, Ways & Means.

House Status:         Referred to Finance Subcommittee.

SB 485 by Norris/HB 513 by Sargent - Bond issuance. Authorizes the state to issue and sell direct obligation bonds of up to $80 million.

Fiscal Note:            (Dated February 15, 2017) Increase State Expenditures - $8,800,000 – First-Year Debt Service $130,400,000 Over the life of the bonds $80,000,000 Principal $50,400,000 Interest

Senate Status:         Referred to Finance, Ways & Means.

House Status:         Referred to Finance Subcommittee.

SB 486 by Norris/HB 514 by Sargent - Authorizes state spending to exceed growth in revenues by 2.85 percent. Authorizes state spending to exceed growth in revenues by $438 million or 2.85 percent.

Fiscal Note:            (Dated February 22, 2017) Other Fiscal Impact – Authorizes an increase in appropriations from state tax revenue up to $438,000,000 for FY16-17.

Senate Status:         Referred to Finance, Ways & Means.

House Status:         Referred to Finance Subcommittee.

COMMERCIAL LAW

ü SB 438 by J. Johnson/HB 484 by Travis - Tennessee Uniform Limited Partnership Act of 2017. Amends TCA Title 61, relative to commercial law and business entities in Tennessee. Enacts the Tennessee Uniform Limited Partnership Act of 2017. Revises sections regarding limited partnerships and limited liability partnerships, including dissolution of such partnerships. Also amends sections relative to foreign limited partnerships.

Fiscal Note:            (Dated March 6, 2017) Increase State Revenue - $51,300/FY17-18/General Fund $1,600/FY17-18/Division of Business Services $114,600/FY18-19 and Subsequent Years/General Fund $3,500/FY18-19 and Subsequent Years/ Division of Business Services Increase State Expenditures - Exceeds $80,000/FY17-18/General Fund

Senate Status:         Referred to Commerce.

House Status:         Set in Business & Utilities on 3/22/2017.

GENERAL

SB 201 by Overbey/HB 1019 by Jernigan - Amenity allowances for certain domestic not-for-profit entities. Changes part of the mailing address for the Attorney General and Reporter for receiving comments under the Public Benefit Hospital Sales and Conveyance Act of 2006. Permits not-for-profit hospitals to submit the claims data discharge report by electronic transmission. Prevents commissioner of revenue from exercising enforcement against a not-for-profit taxpayer until the taxpayer's appeal is finally adjudicated.

Senate Status:         Referred to Health & Welfare.

House Status:         Referred to Health Subcommittee.

ü SB 417 by Lundberg/HB 469 by Zachary - Fundraising for the TN financial literacy commission. Clarifies that the state treasurer as chair of the Tennessee financial literacy commission has the authority to raise funds for the commission.

Senate Status:         Senate passed on 3/6/2017.

House Status:         Education Administration & Planning passed on 3/14/2017; Set on floor on 3/20/2017.

ü HJR 24 by Powers - Convention of the states to propose a balanced budget amendment. Calls for a convention of the states to plan for an Article V convention to propose a balanced budget amendment to the United States Constitution; creates a balanced budget amendment convention committee.

House Status:         Set in State Government Subcommittee on 3/22/2017.

GOVERNMENT REGULATION

SB 446 by Bell/HB 1175 by Faison - Addendum to the Regulatory Flexibility Act of 2007. Requires the head of each state agency to complete periodic training for the purpose of complying with the Regulatory Flexibility Act of 2007.

Senate Status:         Referred to Government Operations.

House Status:         Referred to Government Operations.

ü SB 449 by Bell/HB 566 by Howell - Guides to practice for administrative agencies. Requires state government entities that establish or adopt guides to practice do so through the promulgation of rules. Specifies that guides to practice include codes of ethics, voluntary certification programs, and metrics for minimum qualities of service.

Amendment:          House Business and Utilities Subcommittee Amendment 1 (003902) clarifies that the rules promulgated by entities pursuant to this legislation shall supersede any existing guides to practice developed or approved by a private organization or association that conflict with or are otherwise not included in such rules.

Senate Status:         Set in Government Operations on 3/22/2017.

House Status:         Business & Utilities Subcommittee passed on 3/14/2017 with amendment 1; Set in Business & Utilities on 3/22/2017.

SB 910 by Bell/HB 852 by Daniel - Burden of proof in contested case hearings on state agencies. Places the burden of proof in contested case hearings on state agencies to prove, by clear and convincing evidence, that the action taken by the agencies was proper.

Senate Status:         Referred to Government Operations.

House Status:         Referred to State Government Subcommittee.

ü SB 911 by Bell/HB 769 by Daniel - Requirements for revocation of a license by an agency. Prohibits the revocation of a license by an agency unless the agency provides notice of facts or conduct that warrant such action and the licensee was permitted to show compliance; requires testimony in an agency proceeding to be given under oath and for persons who allege misconduct by a licensee to be present and available to testify at the proceeding. Requires a person who is denied an occupational license or certification by the final decision of an agency and that decision is subsequently reversed on appeal, to be awarded attorney fees, court costs, pre-judgment interest, post-judgment interest, and lost wages from the agency. Specifies that any lost wages awarded shall only include income lost for the period in which the person was aggrieved by the final decision in the contested case hearing.

Senate Status:         Referred to Government Operations.

House Status:         Set in Business & Utilities Subcommittee on 3/21/2017.

SB 1075 by Lundberg/HB 971 by Crawford - Adverse action related to a license or other privilege - written request for hearing. Increases from 10 to 12 the number of days following any adverse action related to a license or other privilege that the licensee must file a written request for a hearing before the commissioner to contest the action.

Senate Status:         Referred to Finance Revenue Subcommittee.

House Status:         Referred to Finance Subcommittee.

ü SB 1217 by Norris/HB 326 by Hawk - UAPA - rules that may constitute unreasonable restraints of trade. Authorizes commissioners and chief executive officers of administrative departments under which regulatory boards operate to review and either approve or veto rules that may constitute unreasonable restraints of trade. –Part of Administration Package to correct Supreme Court on a North Carolina case as it relates to Accountancy Board and other regulatory boards’ exposure to personal liability. TSCPA is supportive. Amendment added narrows Administration authority over Rules.•

Amendment:          Senate Amendment 2, House Government Committee Amendment 2 (004380) rewrites language in the bill to require each supervising official to ensure that the actions of regulatory boards that displace competition are consistent with a clearly articulated state policy. The supervising official must evaluate whether the action may constitute a potentially unreasonable restraint of trade that requires further review; and if it is determined that an action requires further review, the supervising official must provide notice to the regulatory board within ten (10) business days of the date the action was taken that the action is subject to further review. The supervising official must also review the full evidentiary record regarding the action and, if necessary, supplement the evidentiary record or direct the regulatory board or other involved persons or entities to supplement the evidentiary record. Amends section 2 of the bill to state that prior to a rule being filed by a regulatory board, with the secretary of state, the commissioner or chief executive officer of the administrative department under which a regulatory board operates or to which a regulatory board is administratively attached, or a designee to the extent a conflict of interest may exist with respect to the commissioner or chief executive officer, will remand a rule that may constitute a potentially unreasonable restraint of trade to the regulatory board for additional information, further proceedings, or modification, if the rule is not consistent with a clearly articulated state policy or law established by the general assembly with respect to the regulatory board.

Senate Status:         Senate passed on 3/16/2017 with amendment 2.

House Status:         Set in Business & Utilities on 3/22/2017.

HALL INCOME TAX

ü SB 497 by Kelsey/HB 548 by Wirgau - Distribution of Hall income tax to local governments. Increases the share of Hall tax revenue distributed to local governments from three-eighths to five-eighths. Decreases the percentage of Hall tax revenue distributed to the general fund from five-eighths to three-eighths.

Fiscal Note:            (Dated March 8, 2017) Decrease State Revenue – $61,056,000/FY16-17 $62,668,800/Each Year FY17-18 through FY21-22 Increase Local Revenue – $61,056,000/FY16-17 $62,668,800/Each Year FY17-18 through FY21-22

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Set in Finance Subcommittee on 3/22/2017.

SB 1073 by Lundberg/HB 1122 by Hulsey - Tax on income from stocks and bonds. Reimburses counties and municipalities for lost revenue due to the reduction and elimination of the tax on income from stocks and bonds. Phases out reimbursement over a number of years.

Fiscal Note:            (Dated February 25, 2017) Other Fiscal Impact – To the extent the General Assembly does not enact bills for any year FY17-18 through FY21-22 to reduce the HIT rate by one percent per year, as legislative intent calls for in Tenn. Code Ann. § 67-2-124(b), there will be an increase in state expenditures, and an equivalent increase in local government revenue, of: $99,746,100 in FY22-23; $88,663,200 in FY23-24; $77,580,300 in FY24-25; $66,497,400 in FY25-26; $55,414,500 in FY26-27; $44,331,600 in FY27-28; $33,248,700 in FY28-29; $22,165,800 in FY29-30; and $11,082,900 in FY30-31. To the extent the General Assembly does enact bills for each year FY17-18 through FY21-22 to reduce the HIT rate by one percent per year, there will be an increase in state expenditures, and an equivalent increase in local government revenue, of: $35,626,400 in FY17-18; $54,427,000 in FY18-19; $73,227,700 in FY19-20; $92,028,300 in FY20-21; $110,828,900 in FY21-22; $99,746,100 in FY22-23; $88,663,200 in FY23-24; $77,580,300 in FY24-25; $66,497,400 in FY25-26; $55,414,500 in FY26-27; $44,331,600 in FY27-28; $33,248,700 in FY28-29; $22,165,800 in FY29-30; and $11,082,900 in FY30-31.

Senate Status:         Referred to Finance Revenue Subcommittee.

House Status:         Taken off notice in Finance Subcommittee on 3/1/2017.

ü SB 1332 by Yarbro/HB 564 by Thompson - Discounted privilege taxes for motor vehicles owned or operated by service members and reservists. Allows any county that has levied or may levy a motor vehicle privilege tax, to grant active members of the national guard or the armed forces of the United States and members of a reserve component of the armed forces of the United States or the national guard who reside in the county, a fifty percent discount to pay for the issuance of a special decal, stamp, or other device evidencing of payment for an antique motor vehicle. The discount must be approved by a two-thirds vote of the county legislative body at two consecutive, regularly scheduled meetings, or approved by a majority of the number of qualified voters of the county voting in a referendum on the question of whether or not active and reserve members should be liable for payment of one-half of the tax.

Fiscal Note:            (Dated March 6, 2017) Decrease Local Revenue – Exceeds $4,200/Permissive

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017; Sent to Finance.

House Status:         Set in Local Government Subcommittee on 3/28/2017.

PROFESSIONAL PRIVILEGE TAX

ü SB 15 by Green/HB 25 by Daniel - Phases out the professional privilege tax over a four-year period. Phases out the professional privilege tax by reducing the amount of the tax by $100 each year, starting with the tax year that begins on or after June 1, 2017.

Fiscal Note:            (Dated January 31, 2017) Decrease State Revenue -Net Impact -$88,918,900/FY16-17 $22,229,700/FY17-18 $44,459,400/FY18-19 $66,689,100/FY19-20 $88,918,900/FY20-21 and Subsequent Years Decrease State Expenditures -$974,400/FY16-17 $243,600/FY17-18 $487,200/FY18-19 $730,800/FY19-20 $974,400/FY20-21 and Subsequent Years Increase Local Revenue -$441,200/FY16-17 $110,300/FY17-18 $220,600/FY18-19 $330,900/FY19-20 $441,200/FY20-21 and Subsequent Years

Senate Status:         Finance Revenue Subcommittee sent to Finance with a negative recommendation on 3/1/2017.

House Status:         Set in Finance Subcommittee on 3/22/2017.

SB 132 by Bowling/HB 41 by Van Huss - Phases out professional privilege tax. Phases out the professional privilege tax over a five-year period for tax years that begin on and after June 1, 2017.

Fiscal Note:            (Dated February 1, 2017) Decrease State Revenue -Net Impact -$88,918,900/FY16-17 $17,783,800/FY17-18 $35,567,500/FY18-19 $53,351,300/FY19-20 $71,135,100/FY20-21 $88,918,900/FY21-22 and Subsequent Years Decrease State Expenditures -$974,400/FY16-17 $194,900/FY17-18 $389,800/FY18-19 $584,600/FY19-20 $779,500/FY20-21 $974,400/FY21-22 and Subsequent Years Increase Local Revenue -$441,200/FY16-17 $88,200/FY17-18 $176,500/FY18-19 $264,700/FY19-20 $353,000/FY20-21 $441,200/FY21-22 and Subsequent Years

Senate Status:         Finance Revenue Subcommittee passed on 3/1/2017; Sent to Finance.

House Status:         General Subcommittee of Finance placed behind the budget.

SB 234 by Harris/HB 602 by Williams - Professional privilege taxation. Amends language exempting an attorney who is legally forbidden to practice law by the supreme court of Tennessee, from the privilege tax.

Fiscal Note:            (Dated February 23, 2017) Decrease State Revenue – Net Impact – Exceeds $231,900 Increase Local Revenue – Exceeds $3,300

Senate Status:         Finance Revenue Subcommittee sent to Finance with a negative recommendation on 3/1/2017.

House Status:         Referred to Finance Subcommittee.

SB 235 by Harris/HB 932 by Powell - Professional privilege tax on medical practitioners. Amends language exempting physicians who, present to the board of medical examiners a certified affidavit of inactive status and are no longer earning income from the practice of medicine, from the privilege tax.

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/1/2017.

House Status:         Referred to Finance Subcommittee.

SB 306 by Kyle/HB 46 by Clemmons - Professional privilege tax. Exempts individuals from the professional privilege tax for the first year in which they are licensed or registered in a taxable profession.

Fiscal Note:            (Dated February 1, 2017) Decrease State Revenue - Net Impact - $9,004,100 Decrease State Expenditures - $98,800 Increase Local Revenue - $44,700

Senate Status:         Finance Revenue Subcommittee sent to Finance with a negative recommendation on 3/1/2017.

House Status:         Finance Subcommittee placed behind the budget.

SB 364 by Roberts/HB 13 by Reedy - Phases out the professional privilege tax over a four-year period. Phases out the professional privilege tax over a four-year period, by reducing the amount of the tax by $100 each year, for tax years that begin on and after June 1, 2017.

Fiscal Note:            (Dated February 1, 2017) Decrease State Revenue -Net Impact -$88,918,900/FY16-17 $22,229,700/FY17-18 $44,459,400/FY18-19 $66,689,100/FY19-20 $88,918,900/FY20-21 and Subsequent Years Decrease State Expenditures -$974,400/FY16-17 $243,600/FY17-18 $487,200/FY18-19 $730,800/FY19-20 $974,400/FY20-21 and Subsequent Years Increase Local Revenue -$441,200/FY16-17 $110,300/FY17-18 $220,600/FY18-19 $330,900/FY19-20 $441,200/FY20-21 and Subsequent Years

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/15/2017.

House Status:         Referred to Finance Subcommittee.

ü SB 546 by Ketron/HB 60 by Rogers - Rebate on occupational privilege tax under certain conditions. Allows a person engaged in an occupation subject to the occupational privilege tax to receive a 75 percent rebate on their occupational privilege tax, if they are older than the age for full social security benefits and earn no more than $16,000 per year from the taxable occupation. Requires yearly adjustments to the maximum amount of income from the taxable occupation in order to reflect the percentage of change in the average consumer price index, starting on July 1, 2019.

Fiscal Note:            (Dated February 11, 2017) Decrease State Revenue – Net Impact – $1,893,300 Increase Local Revenue – $23,100

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Finance Subcommittee placed behind the budget.

PROFESSIONS & LICENSURE

SB 290 by Yarbro/HB 355 by Beck - Includes sales prices for accounting and legal services within a central business improvement district as exempt from additional fees. Clarifies that the sales prices for accounting, legal, or other professional services provided within a central business improvement district located within a tourism development zone are not subject to an additional fee. –Bill changes definition to exclude accounting profession that is taxed in Nashville business improvement district.•

Senate Status:         Referred to State & Local Government.

House Status:         Referred to State Government Subcommittee.

ü SB 292 by Tracy/HB 333 by Doss - Changes regulatory board time requirements. Changes the time all costs assessed in accordance with this section are final to 35 days instead of 30 days after a final order of assessment is served.

Amendment:          House Business & Utilities Subcommittee amendment 1 (003216), which deletes all language after the enacting clause and instead requires that the regulatory board retains and establishes the qualifications and compensation for investigators, inspectors, and other staff requiring professional qualifications. Requires all members of the board's staff requiring professional qualifications to serve at the pleasure of the board. Any expenditures by the board shall be subject to approval by the commissioner of finance and administration.

Senate Status:         Set in Commerce on 3/21/2017.

House Status:         Set in Business & Utilities on 3/22/2017.

ü SB 473 by Roberts/HB 979 by Calfee - Freedom to Prosper Act. Enacts the "Freedom to Prosper Act" to prohibit local government entities with jurisdictional boundaries from: (1) Imposing any licensing requirements on an occupation unless the political subdivision imposed licensing requirements on that occupation prior to July 1, 2017. Subject to (3), a political subdivision may continue to impose licensing requirements on an occupation if the political subdivision imposed licensing requirements on that occupation prior to July 1, 2017; (2) Imposing any licensing requirement on an occupation that expands or increases any licensing requirements imposed on such occupation by a state agency; or (3) Continuing to impose licensing requirements on an occupation, if a state agency begins to impose licensing requirements on the occupation and the occupation was not previously subject to licensing requirements imposed by a state agency.

Fiscal Note:            (Dated March 5, 2017) Forgone Local Revenue – Exceeds $10,000 Local Expenditures – Cost Avoidance – Exceeds $10,000

Senate Status:         Set in Commerce on 3/21/2017.

House Status:         Set in Business & Utilities on 3/22/2017.

SB 664 by Gardenhire/HB 942 by Carter - Solicitation of clients by mail or broadcast media by attorneys. Clarifies the difference between "law business" and "practice of law" to distinguish unauthorized practices of law by solicitations through mail, radio, TV, and other media. Creates statutory educational requirements to match those established by supreme court rule.

Senate Status:         Referred to Judiciary Subcommittee on Vehicular Crimes.

House Status:         Referred to Civil Justice Subcommittee.

PUBLIC EMPLOYEES

ü SB 808 by Yager/HB 909 by Wirgau - County Financial Officer Certification and Education Act of 2017. Establishes the County Financial Officer Certification and Education Act of 2017. Requires certain county financial officers to complete initial training and continuing education in order to ensure competence in the handling of county funds and the protection of public moneys.

Fiscal Note:            (Dated March 11, 2017) Increase State Expenditures - $1,575,600/One-Time $500,000/Recurring Other Fiscal Impact – Upon depletion of the one-time $1,575,600 appropriation, there will be a mandatory recurring increase in local government expenditures for training of employees estimated to exceed $150,000 annually.* There is a potential temporary loss of use of an unknown but significant amount of sales tax revenue for any local government entity out of compliance with this legislation. The extent of any mandatory increase to local government expenditures for payment of employees at higher compensation rates due to professional certifications being obtained cannot be determined. An appropriation of $2,075,600 is included in the Governor’s Recommended Budget Document for FY17-18, on page B-90, of which $500,000 is recurring and $1,575,600 is non-recurring. SB 808 – HB 909

Senate Status:         Set in State & Local Government on 3/28/2017.

House Status:         Set in Local Government Subcommittee on 3/21/2017.

ü SB 1209 by Norris/HB 319 by Hawk - Background checks for employees with access to federal tax information. Authorizes state departments to obtain criminal background checks on all employees or contractors with access to federal tax information. Requires these departments to establish written policies related to employee background checks. Authorizes department chiefs to designate who meets the requirement for criminal background checks. –Part of Administration Package.•

Senate Status:         Referred to State & Local Government.

House Status:         Set in State Government Subcommittee on 3/22/2017.

PUBLIC FINANCE

SB 157 by Watson/HB 132 by C. Johnson - Power of the Tennessee Local Development Authority to purchase bonds. Clarifies that the power of the Tennessee Local Development Authority to purchase bonds or notes under the Tennessee Local Development Authority Act is supplemental to other laws conferring that power. Explains professional services are not required to be based on competitive procurement methods. Requires superintendents of correctional institutions to keep records of supplies electronically or in a well-bound book. States bonds are exempt from gift taxes imposed prior to January 1, 2012.

Senate Status:         Referred to Finance, Ways & Means.

House Status:         Referred to State Government Subcommittee.

ü SB 314 by Briggs/HB 386 by Farmer - Reporting tax increment revenues. Requires tax increment agencies to file annual statement of revenue for only active plans which are currently producing tax increment revenues.

Senate Status:         Senate passed on 2/16/2017.

House Status:         House passed on 3/13/2017.

Other Status:          Sent to the speakers for signatures on 3/13/2017.

TAXES BUSINESS

ü SB 8 by Green/HB 714 by Whitson - Statutory apportionment formula used to calculate franchise and excise taxes. For tax years beginning on or after July 1, 2017, changes the statutory apportionment formula used to calculate franchise and excise taxes from a three-factor formula to a single-sales-factor formula.

Fiscal Note:            (Dated February 10, 2017) Decrease State Revenue – $12,233,000/FY17-18 $48,195,500/FY18-19 $90,795,500/FY19-20 $73,148,000/FY20-21 $67,500,000/FY21-22 and Subsequent Years Increase State Expenditures – $383,800/FY17-18 Other Fiscal Impact – Secondary economic impacts may occur as a result of this bill. Due to multiple unknown factors, fiscal impacts directly attributable to such secondary economic impacts cannot be quantified with reasonable certainty.

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Referred to Finance Subcommittee.

SB 205 by Bowling/HB 1034 by Van Huss - Eliminates the professional privilege tax. Eliminates the professional privilege tax for the tax year ending on May 31, 2018, and subsequent tax years.

Fiscal Note:            (Dated February 7, 2017) Decrease State Revenue - Net Impact - $88,918,900/FY16-17 and Subsequent Years Decrease State Expenditures - $974,400/FY16-17 and Subsequent Years Increase Local Revenue - $441,200/FY16-17 and Subsequent Years

Senate Status:         Finance Revenue Subcommittee sent to Finance with a negative recommendation on 3/1/2017.

House Status:         General Subcommittee of Finance placed behind the budget.

ü SB 302 by E. Jackson/HB 646 by McDaniel - Bail bonds tax excluded from total gross sales reported on business tax returns. Clarifies that the bail bonds tax collected by a bail bondsman shall be excluded from the total gross sales reported on business tax returns or deducted from the gross sales reported.

Fiscal Note:            (Dated March 2, 2017) Decrease State Revenue – $2,800 Decrease Local Revenue – $3,800

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Set in Finance Subcommittee on 3/22/2017.

SB 351 by Lundberg/HB 509 by Crawford - Franchise tax credit. Extends the date by which applications for a franchise tax credit on purchases of industrial machinery can be received and approved by the commissioner of revenue and the commissioner of economic and community development to be exempt from the 15-year limitation on carrying forward credits, from January 1, 2011 to January 1, 2014.

Fiscal Note:            (Dated February 26, 2017) Decrease State Revenue – $1,500,000/FY27-28 Exceeds $1,500,000/FY28-29 and Subsequent Years

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/1/2017.

House Status:         Referred to Finance Subcommittee.

ü SB 828 by Yarbro/HB 844 by Fitzhugh - Requires a report on the total number of jobs created for which franchise and excise tax credits were claimed. Requires commissioner of revenue to annually report the total of created jobs which tax credits were claimed for the preceding year to finance, ways, and means committee.

Amendment:          House Finance Subcommittee Amendment 1 (005076) clarifies that no particular taxpayers will be identified.

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017 with amendment 1; Sent to Finance.

House Status:         Finance Subcommittee passed on 3/15/2017 with amendment 1; Set in Finance on 3/21/2017.

ü SB 829 by Yarbro/HB 843 by Fitzhugh - Report on total amount of franchise and excise tax credits claimed for the preceding fiscal year. Requires the commissioner of revenue to annually report the total amount of franchise and excise tax credits claimed for the preceding fiscal year to the members of the finance, ways and means committees of the senate and the house.

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/15/2017.

House Status:         Set in Finance Subcommittee on 3/22/2017.

ü SB 901 by Bell/HB 65 by Smith - Exemption from franchise and excise tax liability for certain new businesses. Exempts certain new businesses from a portion of their franchise and excise tax liability during their first two years of existence based on the number of employees and the amount of gross receipts in the first two tax years.

Fiscal Note:            (Dated February 15, 2017) Decrease State Revenue – $388,000/FY18-19 $630,400/FY19-20 $668,200/FY20-21 $668,200/FY21-22 $323,300/FY22-23 $50,300/FY23-24

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017; Sent to Finance.

House Status:         Set in Government Operations on 3/22/2017.

SB 1078 by Lundberg/HB 1095 by T. Hill - Franchise and excise tax credits and exemptions for aeronautical jobs. Requires the department of revenue to report the number and amount of franchise and excise tax credits and exemptions issued to privately owned air carriers, general aviation airports, and aeronautical facilities operated in this state.

Senate Status:         Taken off notice in Transportation & Safety on 3/13/2017.

House Status:         Referred to Transportation Subcommittee.

SB 1175 by Hensley/HB 927 by Butt - Changes statutory apportionment formula used to calculate franchise and excise taxes. Changes the statutory apportionment formula used to calculate franchise and excise taxes for small businesses to a single-sales-factor formula.

Fiscal Note:            (Dated February 28, 2017) Decrease State Revenue – $1,652,000/FY17-18 $4,604,000/FY18-19 $3,800,000/FY19-20 $3,008,000/FY20-21 $2,990,000/FY21-22 and Subsequent Years Other Fiscal Impact – Secondary economic impacts may occur as a result of this bill. Due to multiple unknown factors, fiscal impacts directly attributable to such secondary economic impacts cannot be quantified with reasonable certainty.

Senate Status:         Finance Revenue Subcommittee sent to Finance with a negative recommendation on 3/1/2017.

House Status:         Referred to Finance Subcommittee.

ü SB 1207 by Norris/HB 320 by Hawk - Re-calculation of franchise/excise tax payments. Alters the formula used to calculate quarterly payments for franchise and excise taxes. Reduces the penalty for failing to timely file an excise tax exemption form from $1,000 to $200. –Part of Administration Package. Annualization bill. Funded in budget. TSCPA supports.•

Fiscal Note:            (Dated February 28, 2017) Decrease State Revenue – $11,225,900/FY16-17 $3,697,700/FY17-18 $261,100/FY18-19 and Subsequent Years The Governor’s Recommended Budget Document for FY17-18, on page A-38, recognizes a one-time decrease in state revenue to the General Fund of $3,436,600, and a recurring decrease in state revenue to the General Fund of $261,100. The proposed budget further recognizes a decrease in state revenue to the General Fund of $11,225,900 in FY16-17.

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017; Sent to Finance.

House Status:         Finance Subcommittee passed on 3/15/2017; Set in Finance on 3/21/2017.

ü SB 1236 by Norris/HB 957 by Akbari - Community resurgence job tax credits. Revises the wage requirement for a qualifying job under the Community Resurgence Job Tax Credit Act of 2015 from requiring wages equal to, or greater than, the state's average occupational wage to requiring wages at least 65 percent of the labor workforce development area wage.

Fiscal Note:            (Dated March 8, 2017) Decrease State Revenue – Exceeds $50,000/FY17-18 Exceeds $100,000/FY18-19 and Subsequent Years Forgone State Revenue – Exceeds $50,000/FY17-18 Exceeds $100,000/FY18-19 and Subsequent Years

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017; Sent to Finance.

House Status:         General Subcommittee of Finance placed behind the budget.

ü SB 1274 by Norris/HB 1042 by Gant - Taxation of business entities and their owners. Allows professionals who own corporations, limited partnerships, and similar business entities to take their professional privilege tax payment as a credit against the business entity's franchise and excise tax liability.

Fiscal Note:            (Dated March 8, 2017) Decrease State Revenue – $2,000,000

Senate Status:         Finance Revenue Subcommittee returned to Finance on 3/15/2017 with a negative recommendation.

House Status:         Referred to Finance Subcommittee.

ü SB 1277 by Norris/HB 1345 by Camper - Pilot program to issue franchise and excise tax credits to shippers making shipments into and from Shelby County. Establishes a pilot program to issue franchise and excise tax credits to shippers making shipments into and from Shelby County. Requires a shipper to establish and implement a turn-around policy that assures pickups and deliveries are performed during the period of time agreed upon, and that the shipper provides the motor carrier with contact information for any person receiving the delivery.

Fiscal Note:            (Dated March 10, 2017) Decrease State Revenue – Exceeds $2,065,900/FY18-19 and Subsequent Years Increase State Expenditures – $149,300/FY18-19 $139,600/FY19-20 and Subsequent Years Other Fiscal Impact – Secondary economic impacts may occur as a result of this bill. Such impacts may be reflected as improvements in shipment delivery times for Tennessee businesses, an increase in the state’s competitiveness in retaining existing shipping companies and recruiting other shipping companies to locate in the state, and additional commercial activity in the state as a result of qualified companies reinvesting their savings in the state’s economy. Any fiscal impacts directly attributable to such economic impacts are considered secondary and cannot be quantified with reasonable certainty.

Senate Status:         Finance Revenue Subcommittee returned to Finance on 3/15/2017 with a negative recommendation.

House Status:         Referred to Finance Subcommittee.

ü SB 1426 by Tracy/HB 674 by Lynn - Retailers to deduct bad debt written off by a lender from a private label credit card account. Allows retailers to deduct bad debt written off by a lender from a private label credit card account on the retailer's sales tax return under certain conditions.

Senate Status:         Referred to Delayed Bills.

House Status:         Set in Finance Subcommittee on 3/22/2017.

TAXES FUEL

ü SB 1107 by Kyle/HB 1243 by Clemmons - Taxes and fines related to the highway fund. Increases gasoline and diesel tax rates and allocates revenues to highway fund. Authorizes local option gasoline tax and surcharge. Increases registration fees and creates transportation services district consisting of certain counties. Authorizes special allocation of surplus state tax revenue within district to eligible counties for transportation services. Extends Class C misdemeanor offense of consuming an alcoholic beverage or possessing an open alcoholic beverage container in an operating motor vehicle to passengers.

Fiscal Note:            (Dated February 28, 2017) Increase State Revenue – $297,189,600/Highway Fund $612,600/General Fund $111,000/Motor Vehicle Account A permissive recurring increase in local government revenue of up to $102,660,000 as a result of the authorization for counties to impose a privilege tax of up to $0.03 per gallon on all gasoline sold and delivered to a retail station in the county. Subsequent increases in state and local government revenue and state and local government expenditures are possible as a result of the Act’s authorization for local governments to impose tax surcharges upon voters’ approval to property taxes, sales and use taxes, or severance taxes, and as a result of future tax rate inflation-adjusted increases. Such subsequent fiscal impacts cannot be determined with reasonable certainty and are not accounted for in this fiscal analysis. Pursuant to 23 CFR Part 1270, $19,210,000 of the federal funds apportioned to the state under the National Highway Performance Program and the Surface Transportation Block Grant Program is currently used for alcohol-impaired driving programs ($11,718,100) and highway safety improvement programs ($7,491,900). The open container law change will result in a shift of $11,718,100 in federal funding from the Highway Safety Office to the Department of Transportation (TDOT). TDOT will be authorized to use the entire $19,210,000 on highway construction projects. To the extent the state elects to continue existing programs that are funded by such funds, an additional state appropriation will be required. Secondary economic impacts may occur as a result of this bill. Due to multiple unknown factors, fiscal impacts directly attributable to such secondary impacts cannot be quantified with reasonable certainty.

Senate Status:         Set in Transportation & Safety on 3/20/2017.

House Status:         Taken off notice in Transportation Subcommittee on 3/8/2017.

SB 1130 by Kyle/HB 1302 by Turner - Claims for refunds of gas tax used for agricultural purposes. Requires claims for refunds of gas tax used for agricultural purposes to be submitted quarterly rather than semiannually.

Senate Status:         Taken off notice in Transportation & Safety on 3/13/2017.

House Status:         Referred to Transportation Subcommittee.

ü SB 1221 by Norris/HB 534 by Casada - Returned revenue related to liquefied gas used. Changes to July 20 from July 25 the date by which a commercial user of a vehicle propelled by liquefied gas or compressed natural gas must submit the report of miles traveled and tax due for that year. –Part of Administration Package. Gas Tax bill.•

Amendment:          House Transportation Subcommittee Amendment 1 (004082) adds a new section requiring an additional registration fee of $100 to be paid to the department of transportation every time an electric vehicle is registered or renewed. It also deletes mentions of inflation adjustment throughout the bill as well as entirely taking out sections 18, 20, 22, 30, and 32. House Transportation Subcommittee Amendment 2 (004087) deletes gas and diesel tax provisions and allocates 75% of the sales tax revenue collected from the gas tax to the state general fund, 16.6% to the highway fund, 5.6% to various counties, and 2.8% to various municipalities. Senate Transportation Assessment Subcommittee Amendment 1 (004662) adds a list of development and construction projects, prioritized by the Department of Transportation, for the highway fund revenue allocation. Allows the Department of Transportation to make recommendations in its annual transportation improvement program that projects to be deleted, added, or modified in the list.

Senate Status:         Transportation & Safety passed on 3/13/2017 with amendment 1; Set in State & Local Government on 3/21/2017.

House Status:         Set in Transportation on 3/21/2017.

SB 1275 by Norris/HB 1253 by Rudd - Claims of tax refunds for gasoline losses. Increases the amount of time from 60 days to 90 days in which a vendor must submit a written claim for a refund of tax on a loss of gasoline or diesel due to fire, flood, storm, theft, or other causes over which a vendor has no control.

Senate Status:         Referred to Transportation.

House Status:         Referred to Transportation Subcommittee.

TAXES GENERAL

SB 181 by Overbey/HB 144 by Swann - Tax collection proceeding - copy of court order can be entered on the tax books. Allows the court in a tax collection proceeding to enter on the tax books a copy of the court order. –Caption bill.•

Senate Status:         Referred to Judiciary.

House Status:         Referred to Civil Justice Subcommittee.

SB 193 by Overbey/HB 331 by Swann - People 100 years of age or older exempt from the Hall income tax. Exempts people 100 years of age or older, or any persons who file a joint return and either spouse is 100 years of age or older, from the Hall income tax.

Fiscal Note:            (Dated February 3, 2017) Decrease State Revenue - Net Impact - $76,000/Each Year FY17-18 through FY21-22 Decrease Local Revenue - Net Impact - $40,600/Each Year FY17-18 through FY21-22

Senate Status:         Taken off notice in Finance, Ways & Means.

House Status:         General Subcommittee of Finance placed behind the budget.

SB 253 by Tracy/HB 908 by Wirgau - Reporting disaster relief refunds. Requires the commissioner of revenue to annually report the amount of disaster relief refunds issued by the department to the general assembly.

Senate Status:         Referred to Finance, Ways & Means.

House Status:         Referred to Transportation Subcommittee.

ü SB 1350 by Bailey/HB 693 by Williams - Report on the amount of disaster relief refunds issued by the department of revenue. Requires the commissioner of revenue to annually report the amount of disaster relief refunds issued by the department.

Senate Status:         Recalled from Transportation on 2/15/2017 and referred to State & Local Government.

House Status:         Set in Transportation Subcommittee on 3/22/2017.

TAXES PROPERTY

SB 21 by Green/HB 23 by M. Hill - Property tax relief for disabled veterans. Re-establishes the first portion of home value for which real property tax relief will be reimbursed to disabled veteran home owners from $100,000 to $175,000.

Fiscal Note:            (Dated February 9, 2017) Increase State Expenditures - $4,835,000

Senate Status:         State & Local Government Veterans Affairs Subcommittee returned to full comment with a neutral recommendation on 3/6/2017.

House Status:         Referred to Local Government Subcommittee.

SB 23 by Green/HB 20 by Pitts - Property tax relief for disabled veterans and low-income elderly. Increases the home value for which real property tax relief will be granted from $100,000 to $175,000 for veterans with disabilities and from $23,500 to $25,000 for low-income elderly or disabled homeowners.

Fiscal Note:            (Dated February 15, 2017) Increase State Expenditures - $5,992,200

Senate Status:         State & Local Government Veterans Affairs Subcommittee returned to full committee with a neutral recommendation on 3/6/2017.

House Status:         Taken off notice in Local Government Subcommittee on 2/21/2017.

SB 25 by Green/HB 5 by Ragan - Disabled veteran property tax reimbursement. Increases the stated value of a given property to $175,000 from $100,000 for reimbursement of property taxes to a disabled veteran.

Fiscal Note:            (Dated February 6, 2017) Increase State Expenditures - $4,835,000

Senate Status:         Referred to State & Local Government.

House Status:         Taken off notice in Local Government Subcommittee on 2/7/2017.

ü SB 139 by Dickerson/HB 87 by Crawford - County board of equalization notices of final decision. Requires the county board of equalization to give notice to any property owner that appears before the board of its final decision and the procedure of appeal to the state board of equalization. Also to give notice of the taxpayer's right to electronically file an appeal to the state board of equalization including a link to the online appeal form, the current address of the state board of equalization as indicated on its website, statutory deadlines, and any other information required by the state board of equalization.

Senate Status:         Senate passed on 2/9/2017.

House Status:         Local Government passed on 3/14/2017; Sent to Calendar & Rules.

SB 142 by Bailey/HB 83 by Gravitt - County board of equalization continuing education and training. Requires board members of the board of equalization and county board hearing officers to complete annual continuing education and training on duties and responsibilities of their office as a condition of appointment or continued service. Requires a minimum of at least four hours of training for board members to complete annually and minimum recordkeeping requirements related to members' certificates of attendance. Such training will include board governance, open meetings requirements, and other topics reasonably related to the duties of the members of the county board of equalization.

Amendment:          House amendment 1 (003956) adds new language to clarify that mandatory annual continuing education and training is only required under subsection (e) of the bill, to the extent that the education and training is provided by the comptroller of the treasury free of charge.

Status:                    Sent to the speakers for signatures on 3/9/2017.

SB 143 by Jackson/HB 82 by Sherrell - Complaints to county board of equalization. Allows any county board of equalization to permit any owner or taxpayer to make a written appearance for complaints. Requires anyone representing a taxpayer before a county board of equalization, to have written authorization signed by the taxpayer.

Senate Status:         Senate passed on 2/9/2017.

House Status:         Taken off notice in Local Government Subcommittee on 3/7/2017.

SB 169 by Stevens/HB 133 by Hicks - Studying and reporting tax laws by the commissioner of revenue. Relieves the commissioner of revenue from the duty of preparing and transmitting a report on the work of the board to the general assembly.

Senate Status:         Referred to State & Local Government.

House Status:         Referred to Local Government Subcommittee.

ü SB 238 by Haile/HB 282 by Carr - Board of Equalization- property tax appeals. Authorizes the state board of equalization to appoint members from the division of property assessments, to serve in the capacity of hearing examiners to conduct preliminary hearings and to make investigations for the board or the assessment appeals commission regarding complaints and appeals from assessments and classifications. Clarifies that a hearing examiner includes an administrative judge serving by appointment of the state board of equalization or an administrative judge serving on behalf of the board under appointment by the secretary of state. Sets standards for a review hearing in the case of an appeal of a hearing examiners' decision, or if the state board of equalization or the assessment appeals commission does not adopt the recommendation of the hearing examiner.

Senate Status:         State & Local Government passed on 3/14/2017; Sent to Calendar Committee.

House Status:         Set in Local Government Subcommittee on 3/21/2017.

ü SB 254 by Crowe/HB 176 by Forgety - Property tax relief for disabled veterans. Increases the property value threshold for determining the extent of property tax relief payments to disabled veterans and their surviving spouses from $100,000 to $175,000 of the full market value of the property.

Fiscal Note:            (Dated March 5, 2017) Increase State Expenditures - $3,219,500/FY17-18 $2,961,900/FY18-19 Other Fiscal Impact – In FY19-20 and subsequent years, the estimated increase in state expenditures pursuant to this bill will diminish by approximately eight percent each year into perpetuity until the impact of the property tax relief program is constant with the impact experienced under current law.

Senate Status:         State & Local Government Veterans Affairs Subcommittee returned to full committee with a neutral recommendation on 3/6/2017.

House Status:         Set in Local Government Subcommittee on 3/14/2017.

ü SB 257 by Tracy/HB 579 by Tillis - Notice to property taxpayer in property tax case. States that return of the receipt for a mailed summons or notice that is either signed by the defendant or marked refused shall be grounds for a default judgment in a delinquent property tax case.

Senate Status:         Referred to State & Local Government.

House Status:         Local Government Subcommittee passed on 3/14/2017; Set in Local Government on 3/21/2017.

ü SB 564 by Harper/HB 585 by Love - Nonprofit educational institution exemption from property taxes in Davidson County. Exempts a nonprofit educational institution with a medical college in Davidson County from property taxes.

Fiscal Note:            (Dated February 27, 2017) Decrease Local Revenue - $735,100/FY17-18/Davidson County Increase Local Expenditures - $130,700/FY17-18/Davidson County*

Senate Status:         Set in State & Local Government on 3/21/2017.

House Status:         Set in Finance Subcommittee on 3/29/2017.

SB 594 by Watson/HB 544 by McCormick - Report on counties and cities that have adopted property tax freeze program. Requires the comptroller to report to the chairs of the senate finance, ways and means committee and the house finance, ways and means committee concerning the number of counties and municipalities that have adopted the property tax freeze program by ordinance or resolution by January 15, 2018.

Senate Status:         Referred to Finance, Ways & Means.

House Status:         Referred to Local Government Subcommittee.

SB 870 by Yarbro/HB 1357 by Mitchell - Property tax freeze for elderly. Requires that an application for a property tax freeze be approved if the qualified applicant dies prior to filing the application on or after January 1 of the tax year for which the freeze is sought

Senate Status:         Referred to State & Local Government.

House Status:         Referred to Local Government Subcommittee.

ü SB 904 by Bell/HB 912 by Wirgau - Redefines "farm property" for classification and assessment of property tax. Redefines "farm property" for classification and assessment of property tax.

Fiscal Note:            (Dated March 11, 2017) Decrease Local Revenue – Net Impact – $1,470,900

Senate Status:         Set in State & Local Government on 3/21/2017.

House Status:         Set in Local Government Subcommittee on 3/21/2017.

ü SB 907 by Bell/HB 768 by Howell - Mailings of notice by delinquent tax attorneys. Clarifies that a delinquent tax attorney preparing to seize personal property may, when delivering notice by mail, deliver the notice by certified, registered, or first class mail.

Senate Status:         Referred to State & Local Government.

House Status:         Set in Local Government Subcommittee on 3/21/2017.

ü SB 940 by Ketron/HB 791 by Sparks - Property taxes Equalization Board adjustments. Deletes an outdated cross-reference to a deleted statute.

Senate Status:         Referred to State & Local Government.

House Status:         Set in Local Government Subcommittee on 3/21/2017.

SB 1235 by Norris/HB 874 by Akbari - Expansion of the tax credit allowed for the purchase of brownfield property. Taxes, Exemption and Credits. Makes revisions to tax credits, such as expanding the tax credit allowed for the purchase of brownfield property to include real property that was previously the subject of an investigation or remediation as a brownfield project under a voluntary agreement or consent order.

Fiscal Note:            (Dated March 11, 2017) Decrease State Revenue – $9,940,000

Senate Status:         Referred to State & Local Government.

House Status:         Taken off notice in Local Government Subcommittee on 3/14/2017.

ü SB 1264 by Norris/HB 172 by McCormick - Veteran's disability status for purposes of property tax relief. Changes from "United States department of veterans administration" to "United States department of veterans affairs" the name of the agency responsible for making determinations of a veteran's disability status for purposes of qualifying for property tax relief.

Amendment:          Senate State & Local Government Veterans Affairs Subcommittee amendment 1 (004670), which raises the reimbursement on local property taxes for disabled veterans from 100,000 dollars to 135,100 dollars, and requires that the amount of reimbursement be updated annually by the comptroller of the treasury to reflect inflation

Senate Status:         State & Local Government Veterans Affairs Subcommittee passed on 3/6/2017 with amendment; Sent to State & Local Government.

House Status:         Set in Local Government Subcommittee on 3/21/2017.

ü SB 1318 by Crowe/HB 86 by Curcio - Property tax exemption records. Changes the language of the preexisting code to clarify that property assessors may retain electronic or digital copies of property tax exemption applications to comply with existing retention requirement.

Senate Status:         Senate passed on 3/13/2017.

House Status:         Local Government Subcommittee passed on 3/14/2017; Set in Local Government on 3/21/2017.

ü SB 1370 by Bailey/HB 425 by Williams - County board of equalization to conduct certain hearings by phone. Authorizes a county board of equalization to conduct hearings by telephone, television, software or electronic means when a taxpayer is provided an opportunity to challenge an increase of tax assessment or change in property classification.

Amendment:          House Local Government Committee amendment 1 (005113)- Deletes all language after the enacting clause and substitutes instead the following: SECTION 1. Tennessee Code Annotated, Title 67, Chapter 5, Part 20, is amended by adding the following as a new section: (a) With respect to a de minimus property tax totaling less than five dollars ($5.00) as calculated for a duly assessed parcel of real property, if authorized by a private act, resolution, or ordinance levying the tax, the county trustee or other property tax collecting official may: (1) Decline to bill the tax; (2) Decline to refer the tax for further collection; or (3) Abate any penalty or interest otherwise due for late payment of the tax. (b) The tax collecting official shall maintain a list of de minimus taxes by parcel and by year, and the tax may be collected when a tax related to the same parcel is tendered for a later year; provided, that such collection is not barred by any applicable statute of limitations. SECTION 2. This act shall take effect upon becoming a law, the public welfare requiring it.

Senate Status:         Set in State & Local Government on 3/21/2017.

House Status:         Local Government passed on 3/14/2017 with amendment 1; Sent to Calendar & Rules.

SB 1422 by Harris/HB 1326 by Stewart - Exemptions of property tax. Amends language to allow property owned by a charitable institution to have a one hundred percent (100%) exemption from property taxation including, but not limited to, if the charitable institution has been owned and maintained by the charitable institution for at least eight (8) years prior to application for the exemption.

Senate Status:         Referred to State & Local Government.

House Status:         Referred to Local Government Subcommittee.

TAXES SALES

ü SB 3 by Dickerson/HB 6 by R. Williams - Apportionment of sales tax revenue associated with a major league soccer franchise. Allocates state sales tax revenue derived from sales of admissions to events of a major league soccer franchise to the municipality in which a sports authority is organized and has secured the franchise.

Fiscal Note:            (Dated February 26, 2017) Other Fiscal Impact – To the extent Nashville’s bid for a major league soccer team is successful, the state would forgo $1,364,200 in revenue each year beginning in FY19-20. All of this forgone revenue, plus an additional $65,800 that the local government would receive under current law pursuant to the state-shared sales tax allocation for a total of $1,430,000, would be allocated to Nashville for the exclusive use of the sports authority.

Senate Status:         Finance Revenue Subcommittee passed on 3/1/2017; Sent to Finance.

House Status:         Finance passed on 3/14/2017; Sent to Calendar & Rules.

SB 10 by Green/HB 15 by Goins - Exemption - vehicles sold to disabled veteran or service member. Exempts from sales tax, registration fees, and motor vehicle privilege tax, any motor vehicle sold, given or donated to a veteran or service member who has a service-connected disability and who is eligible for a U.S. Department of Veterans Affairs automobile grant under the Disabled Veterans' and Servicemen's Automobile Assistance Act of 1970.

Fiscal Note:            (Dated January 24, 2017) Decrease State Revenue - Net Impact - $100,700 Decrease Local Revenue - $6,000

Senate Status:         Transportation & Safety passed on 3/6/2017; Sent to Finance.

House Status:         Finance Subcommittee placed behind the budget.

ü SB 350 by Niceley/HB 342 by Hulsey - Sales tax exemption for sales of certain coins, paper money, and bullion. Exempts certain sales of paper money and gold, silver, platinum, and palladium coins and bullion from sales tax.

Fiscal Note:            (Dated February 24, 2017) Decrease State Revenue – Net Impact – $360,800 Decrease Local Revenue – Net Impact – $117,800

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017; Sent to Finance.

House Status:         Taken off notice in Finance Subcommittee on 3/15/2017.

ü SB 368 by Overbey/HB 369 by Carr - Materials purchased by a local education agency. Exempts contractors and subcontractors from the sales or use tax on construction materials if the materials are purchased by a local education agency and are used in the construction or improvements of such entity.

Fiscal Note:            (Dated February 18, 2017) Decrease State Revenue –$7,346,200 Decrease Local Revenue –$2,997,800 Decrease Local Expenditures –$10,344,000

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Finance Subcommittee placed behind the budget.

SB 415 by Lundberg/HB 1101 by T. Hill - Increase in local option sales tax rate without referendum. Allows county and municipal governments to increase existing local option sales tax rates without approval of the voters in a referendum. Requires any increase by local governments to be subject to approval of the local legislative body by a two-thirds vote.

Senate Status:         Referred to State & Local Government.

House Status:         Withdrawn in House on 3/2/2017.

SB 416 by Lundberg/HB 697 by Crawford - Exemption - diapers used by children. Exempts from sales and use tax the gross receipts derived from the sale of diapers for use by children.

Fiscal Note:            (Dated March 1, 2017) Decrease State Revenue – Net Impact – $6,825,700 Decrease Local Revenue – Net Impact – $2,785,400

Senate Status:         Referred to Finance Revenue Subcommittee.

House Status:         Referred to Finance Subcommittee.

ü SB 515 by Kelsey/HB 1085 by J. Sexton - Allocation of state-shared taxes. Allocates the 1 percent state sales tax increase implemented in 2002 to be divided into 75 percent (to cities 25 percent, to rural counties 25 percent, and to urban counties 25 percent) and 25 percent (to the state general fund). Prohibits a city or county with other post-employment benefits liability from receiving the special allocation if the city or county is not current on its payments.

Fiscal Note:            (Dated February 21, 2017) Decrease State Revenue – $873,563,000 Increase Local Revenue – $873,563,000

Senate Status:         Set in State & Local Government on 3/21/2017.

House Status:         Referred to Local Government Subcommittee.

ü SB 666 by Roberts/HB 1008 by Holt - Exemption - gold and silver bullion and coins. Exempts the sale of all gold and silver bullion and coins that are used as a medium of exchange, security, or commodity from sales tax.

Fiscal Note:            (Dated February 18, 2017) Decrease State Revenue – Net Impact – $305,900 Decrease Local Revenue – Net Impact – $99,600

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/15/2017.

House Status:         Set in Finance Subcommittee on 3/22/2017.

ü SB 735 by Watson/HB 904 by Kumar - Sales tax on food. Separates the 5 percent sales tax on unprepared food into a 5 percent sales tax on fresh produce and meat and a 5 percent sales tax on all other unprepared food and food ingredients.

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Set in Government Operations on 3/22/2017.

SB 846 by Briggs/HB 611 by Kane - Exemption - pet grooming services. Exempts pet grooming services from the sales and use tax.

Fiscal Note:            (Dated February 23, 2017) Decrease State Revenue – Net Impact – $1,407,400 Decrease Local Revenue – Net Impact – $574,300

Senate Status:         Finance Revenue Subcommittee sent to Finance with a negative recommendation on 3/1/2017.

House Status:         Taken off notice in Finance Subcommittee on 3/8/2017.

ü SB 955 by Tracy/HB 703 by K. Brooks - Dealers may retain portion of taxes to compensate for costs incurred in accounting and remitting such taxes. Allows dealers reporting and remitting sales taxes to the department of revenue to retain a certain portion of those taxes in order to compensate for costs incurred in discharging their duties.

Fiscal Note:            (Dated February 25, 2017) Increase State Revenue – Net Impact – $12,490,900 Decrease Local Revenue – Net Impact – $30,553,700

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Set in Finance Subcommittee on 3/22/2017.

SB 963 by Roberts/HB 1012 by Hawk - Report on revenue generated from sales tax on food. Requires the commissioner of revenue to annually report the amount of revenue generated from the tax on the sale of food to the chairs of the finance, ways and means committees of the senate and the house.

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/15/2017.

House Status:         Failed in Transportation Subcommittee on 3/1/2017.

ü SB 1004 by Beavers/HB 744 by Powers - Second amendment sales tax holiday. Establishes a Second Amendment sales tax holiday for the first weekend of September of each year for firearms and ammunition.

Fiscal Note:            (Dated March 10, 2017) Decrease State Revenue – $235,000 Increase State Expenditures – $95,900

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017; Sent to Finance.

House Status:         General Subcommittee of Finance placed behind the budget.

ü SB 1118 by Kyle/HB 833 by Jones - Reduces state sales tax rate on diapers, feminine hygiene products, and nonexempt over-the-counter drugs. Reduces the state sales and use tax rate on retail sales of diapers, feminine hygiene products, and nonexempt over-the-counter drugs from 7 percent to 5 percent.

Fiscal Note:            (Dated March 8, 2017) Decrease State Revenue – Net Impact – $14,543,100 Decrease Local Revenue – Net Impact – $509,900

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Referred to Finance Subcommittee.

ü SB 1169 by Hensley/HB 426 by Butt - Exemption - CPAP supplies. Exempts CPAP supplies from being subject to sales and use tax.

Fiscal Note:            (Dated March 8, 2017) Decrease State Revenue – Net Impact – $1,275,000 Decrease Local Revenue – Net Impact – $520,300

Senate Status:         Set in Finance Revenue Subcommittee on 3/21/2017.

House Status:         Set in Finance Subcommittee on 3/22/2017.

SB 1174 by Hensley/HB 926 by Butt - Reduces sales and use tax on food. Reduces the sales and use tax on food from 5 percent to 4.5 percent.

Fiscal Note:            (Dated February 22, 2017) Decrease State Revenue – Net Impact – $57,588,600 Decrease Local Revenue – Net Impact – $2,018,800 General

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/1/2017.

House Status:         Referred to Finance Subcommittee.

ü SB 1208 by Norris/HB 318 by Hawk - Delays effective date of certain streamlined sales tax provisions. Delays effective date of certain streamlined sales tax provisions until July 1, 2019. –Part of Administration Package.•

Senate Status:         Finance Revenue Subcommittee passed on 3/15/2017; Sent to Finance.

House Status:         Finance passed on 3/14/2017; Set on floor on 3/20/2017.

SB 1374 by Briggs/HB 1317 by Zachary - Reporting of administrative costs. Requires the commissioner of revenue to report to the governor and the general assembly the state administrative costs for remitting sales and use taxes back to local governments in this state, no later than February 1, 2018.

Senate Status:         Taken off notice in Finance Revenue Subcommittee on 3/1/2017.

House Status:         Referred to Finance Subcommittee.