HB 940 - SB 918
FISCAL NOTE
Fiscal Review Committee
Tennessee General Assembly
March 7, 2025
Fiscal Analyst: Rebecca Chandler | Email: rebecca.chandler@capitol.tn.gov | Phone: 615-741-2564
HB 940 - SB 918
SUMMARY OF BILL: Increases the minimum age requirement for operating a personal
watercraft from 12 to 16 years old. Mandates proof of financial responsibility for personal watercraft
operators.
FISCAL IMPACT:
STATE GOVERNMENT
REVENUE Wildlife Resources Fund
FY25-26 & Subsequent Years ($15,600)
OTHER FISCAL IMPACT
Due to multiple unknown variables, any recurring decreases in state and local sales tax revenue and
recurring increases in state premium tax revenue, cannot be quantified with reasonable certainty.
Assumptions:
• Pursuant to Tenn. Code Ann § 69-9-501, a personal watercraft is defined as a mechanically
propelled vessel that is designed to be operated by a person sitting, standing or kneeling on
the vessel rather than being operated in a conventional manner by a person sitting, standing,
or kneeling inside the vessel. It includes, but is not limited to, Jet Skis, Waverunners, Sea-
Doos, Wetjets, Aquajets, Polaris, Tigersharks, and similar craft.
• It is assumed that increasing the age requirement will not have a significant impact upon
sales of watercraft in the state. However, requiring proof of financial ownership for the
operation of personal watercraft could impact future sales as this requirement adds a
significant cost factor to watercraft ownership. Due to multiple unknown variables, any
impact on state and local sales tax revenue cannot be quantified with reasonable certainty as
it is dependent on future behavior of consumers that will be sufficiently disincentivized
from purchasing a personal watercraft.
• Prior to operating any watercraft in Tennessee, an individual is required to complete a
boating safety exam.
• This legislation will result in individuals within the age group of 12-15 years no longer
having an incentive to take such exam.
• The exam is $10, of which $1.00 is kept by the licensing agent and the remaining $9.00 is
allocated to the Wildlife Resources Fund.
• Licensing agents are private companies.
HB 940 - SB 918 2
• The number of exams taken by the affected age group, total revenue, and revenue
allocations are as follows:
Boating Safety Exams (Age 12-15)
Exams Taken Revenue
Revenue allocations
Agent
Wildlife
Fund
FY20-21 1,603 $14,427 $1,603 $12,824
FY21-22 1,817 $16,353 $1,817 $14,536
FY22-23 1,638 $14,742 $1,638 $13,104
FY23-24 2,415 $24,150 $2,415 $21,735
Average $15,550
• Individuals that will be disincentivized from purchasing a personal watercraft as a result of
proof of financial ownership requirement will also no longer take such exams. Due to
multiple unknown variables, any decrease in state revenue associated with such individuals
cannot be quantified with reasonable certainty.
• However, while some individuals within the age group of 12-15 will still complete the safety
exam as they will be authorized to operate a personal watercraft with the direct supervision
of an adult, and while most of the testing impact for individuals no longer taking the test
due to financial responsibility requirements, it is assumed that the average revenue above
sufficiently approximates the total loss of state revenue for both groups of individuals on a
recurring basis.
• Therefore, the recurring decrease in state revenue to the Wildlife Resources Fund in FY25-
26 and subsequent years is estimated to be $15,550.
• For those individuals that obtain insurance on their personal watercrafts, there will be a
recurring increase in state revenue associated with premium taxes on such insurance
policies. However, due to multiple unknown variables, any such increases cannot be
quantified with reasonable certainty.
CERTIFICATION:
The information contained herein is true and correct to the best of my knowledge.
Bojan Savic, Executive Director