Tennessee Senate Bill SB2544

Tennessee 2023-2024 Regular Session

• Introduced: 1/31/24

Caption

AN ACT to amend Tennessee Code Annotated, Title 4; Title 12; Title 45 and Title 47, relative to financial transaction integrity.

Impact

The proposed bill mandates that all contracts relating to financial transactions using state funds comply with state jurisdictional standards. This means all agreements must be enforceable under Tennessee laws, preventing any choice of law provisions that would shift jurisdiction to external authorities. Such a requirement is intended to fortify the operational integrity of state transactions and secure the flow of government services, credits, and payments. In instances where contracts are currently non-compliant, they cannot be renewed without adherence to these new stipulations.

Summary

Senate Bill 2544 aims to amend the Tennessee Code across several titles to enhance the integrity of financial transactions within the state by asserting state jurisdiction over systems involving financial transactions. The bill addresses concerns regarding the vulnerabilities of electronic systems, such as cybersecurity threats and potential disruptions from natural disasters or geopolitical events that could affect state financial operations. By establishing clear regulations, the bill seeks to ensure uninterrupted transactions for state agencies, municipalities, and subdivisions with essential service providers and financial institutions.

Contention

Key points of contention surrounding SB2544 may center on the implications for existing contracts and how the jurisdictional demands could affect service providers. Some stakeholders may argue that this bill could create barriers to collaboration with private entities that operate beyond Tennessee's borders. Concerns may also be raised regarding the feasibility and administrative burden of compliance for local and state agencies, particularly in adapting to the new standards for contract renewals and management. The level of scrutiny that the bill places on external contracts could also raise questions about the state's role in regulating financial systems and its relationship with vendors and contractors.