Tennessee House Bill HB1403

Tennessee 2025-2026 Regular Session

• Introduced: 2/10/25
• Refer: 2/10/25

Caption

AN ACT to authorize the state of Tennessee, acting by resolutions of its funding board, to issue and sell its bonds and bond anticipation notes to provide for acquisition of equipment and sites, and erection, construction, and equipment of sites and buildings, expressly including the acquisition of existing structures for expansion, improvements, betterments, and extraordinary repairs to existing structures, for construction of highways, and repair, replacement, or rehabilitation of bridges, and for grants to any county, metropolitan government, incorporated town, city, special district of the state, or any governmental agency or instrumentality of any of them; to make grants to industrial development corporations to provide for acquisition of equipment and acquisition, site preparation, erection, construction, and equipment of sites and buildings; and infrastructure improvements and development; and to provide for the expenditure of said funds; to issue its debt in excess of the authorized amount to fund discount and costs of issuance; and to provide for the expenditure of said funds. This act makes appropriations for an indefinite period of time for the purpose of allocating the proceeds of the bonds and notes authorized by this act.

Impact

One of the key provisions of HB1403 is the allocation of bond proceeds to the Tennessee higher education commission. This allocation is intended for capital outlay and maintenance of the state's higher educational institutions. By providing financial resources for these projects, the bill aims to promote educational infrastructure, which is viewed as essential for supporting student success and institutional growth in Tennessee. Furthermore, the bill allows the funding board to sell additional bonds for costs of issuance, thereby maximizing the potential funding available for public projects.

Summary

House Bill 1403 authorizes the state of Tennessee to issue and sell direct general obligation bonds up to thirty million dollars ($30,000,000). The funds from these bonds are designated for various purposes, including acquisition of equipment and sites, construction and improvements of buildings, infrastructure development, and repairs to highways and bridges. The bill encompasses broad funding provisions aimed at facilitating significant capital projects across the state, reflecting Tennessee's commitment to enhancing its infrastructure and supporting educational institutions.

Contention

Despite the potential benefits, there are underlying concerns regarding the issuance of such bonds, particularly related to the fiscal responsibility of the state. Critics may argue about the implications of increasing state debt, questioning whether the benefits of infrastructure improvements justify the financial risks. Additionally, the bill's impact on local governments and how the funds will be allocated among various projects can lead to debates about transparency and prioritization of state resources. Moreover, the exemption of the bond interest from taxation raises questions about the long-term impacts on state revenue and public services.