HB 52 – SB 473
FISCAL NOTE
Fiscal Review Committee
Tennessee General Assembly
March 8 2025
Fiscal Analyst: Rebecca Chandler | Email: rebecca.chandler@capitol.tn.gov | Phone: 615-741-2564
HB 52 – SB 473
SUMMARY OF BILL: Enacts the Veterans Assistance for Livelihood, Opportunity, and Relief
(VALOR) Act. Eliminates the $10 one-time fee for a permanent sport combination hunting and
fishing license (DAV), allowing eligible veterans to obtain it at no cost.
Requires the General Fund to pay or reimburse eligible disabled veterans and surviving spouses for
all local property taxes on their primary residence. Exempts eligible disabled veterans from paying
taxes and fees for the registration of one qualifying vehicle. Effective January 1, 2026.
FISCAL IMPACT:
STATE GOVERNMENT
REVENUE Wildlife Resources Fund
FY26-27 ($57,400)
FY27-28 & Subsequent Years ($114,800)
EXPENDITURES General Fund
FY26-27 & Subsequent Years Exceeds $32,798,500
OTHER FISCAL IMPACT
The extent of any permissive impact on local government expenditures due to the elimination of
property taxes for eligible veterans cannot reasonably be estimated.
Assumptions:
Fishing and Hunting Licenses
• Pursuant to Tenn. Code Ann. § 70-2-104(a)(4)(B), the Tennessee Wildlife Resources
Agency (TWRA) charges disabled veterans with a 100 percent permanent and total
disability resulting from a service-connected cause, as determined by the U.S. Department
of Veterans Affairs, a discounted rate of $10 for a DAV license.
• The proposed legislation will eliminate this one-time fee for eligible veterans.
• Based on annual sales data for DAV licenses from 2020-2024 provided by the TWRA, the
Department is projected to sell at least 2,240 of these licenses in FY25-26.
• This legislation will create a recurring annual decrease of $22,400 (2,240 licenses x $10 fee)
in state revenue.
HB 52 – SB 473 2
• Since the proposed legislation is effective on January 1, 2026, only half of the decrease in
overall state revenue will affect FY25-26, resulting in $11,200 ($22,400 x 50%).
• TWRA receives federal reimbursement for fish and wildlife management based on the
number of DAV licenses annually, which will no longer apply if these licenses are provided
at no cost.
• According to TWRA, the federal reimbursement per license is valued at $41.25, leading to
a recurring annual loss of $92,400 in revenue in FY26-27 and subsequent years ($41.25
license x 2,240 licenses).
• Due to the half-year impact, the decrease in revenue will be $46,200 ($92,400 x 50%).
• Therefore, the recurring decrease in state revenue to the Wildlife Resources Fund will be
$114,800 ($22,400 + $92,400).
• The total decrease in state revenue to the Wildlife Resources Fund in FY25-26 will be
$57,400 ($11,200 + $46,200).
Property Taxes
• Pursuant to Tenn. Code Ann. § 67-5-704, the state’s General Fund pays or reimburses
with a 100 percent permanent and total disability resulting from a service-connected cause
or their eligible surviving spouses for all or part of the local property taxes paid for a given
tax year on a property that the disabled veteran owned and used as their residence. The
reimbursement applies to the first $175,000 of the full market value of such property.
• The proposed legislation pays or reimburses all local property taxes, removing from the
current $175,000 cap and calculations based on appraised and market values.
• The proposed legislation takes effect on January 1, 2026; therefore, it is assumed that tax
year 2026 will be the first tax year impacted.
• It is assumed that the vast majority of tax collection for tax year 2026 will fall within FY26-
27.
• Based on information provided by the Comptroller of the Treasury from FY23-24:
o The total amount of property taxes for disabled veteran homeowners and surviving
spouses was $53,705,103;
o The total amount of property tax relief was $30,359,815; and
o If the total tax amount had been paid for all disabled veterans and surviving spouses,
the increase in state expenditures would have been $23,345,290 ($53,705,103-
$30,359,815).
• Based on the recent growth rate in property tax relief payments to disabled veterans and
their surviving spouses, the impact to this population has been projected forward to FY26-
27 using an annual growth rate of 12 percent in order to determine the estimated increase
in tax relief payments.
• Subsequent years would be expected to see similar growth percentages.
• Projecting the estimated property tax amount from 2023 for this population forward to
FY26-27 and subsequent years, the proposed legislation will result in an increase in state
expenditures exceeding $32,798,452{[($23,345,209 FY23-24 x 12% FY24-25) x 12%
FY25-26] x 12% FY26-27]}.
• Certain local governments have adopted supplement tax relief programs; the proposed
legislation would eliminate any need for those programs, resulting in a decrease in local
expenditures for tax relief payments.
HB 52 – SB 473 3
• It is not known whether such local governments would see a cost-savings or instead direct
such funds to a different purpose; any permissive impact to local government expenditures
cannot be estimated.
Vehicle Registration
• The proposed legislation grants disabled veterans with a 100 percent permanent and total
service-connected disability an exemption from all registration taxes and fees for one vehicle.
This exemption applies to a private passenger automobile, recreational vehicle, or a specified
truck, as specified in Tenn. Code Ann. § 55-4-103(a)(1).
• Pursuant § 55-4-256, the Department of Revenue (DOR) must issue free registration and
license plates bearing the term “Disabled Veteran” to 100 percent service-connected
disabled veterans in the state for vehicles registered in their name, jointly with their spouse,
or leased by them, including motorhomes with life support equipment, provided the vehicles
are not used for commercial purposes.
• Based on information provided by the DOR, there are 49,580 Disabled Veteran plates
registered in the state.
• Since current statutes already provide eligible veterans with free vehicle registration, no
additional revenue impact is expected beyond what is currently exempt under existing law.
CERTIFICATION:
The information contained herein is true and correct to the best of my knowledge.
Bojan Savic, Executive Director