House Bill 127 amends various sections of the Tennessee Code Annotated regarding local tax surcharges and transportation improvements. The bill inserts language to clarify that surcharges levied under Chapter 4, Part 32 are exceptions to bond issues in specific subsections. It also replaces the term "transit improvement" with "transportation improvement" throughout the relevant sections. Additionally, the bill redefines key terms such as "implementing agency," "local government," "surcharge," and "transportation improvement program" to broaden the scope of local government responsibilities and the types of projects included.

Furthermore, the bill establishes a new requirement for local governments to appropriate and allocate funds for road purposes from local revenue sources, ensuring that the amount is not less than the average of the previous five fiscal years. If a local government fails to meet this requirement after July 1, 2025, their revenue allocation under this part will be reduced accordingly, with the unallocated funds redirected to the state highway fund for improvements in the local jurisdiction. The act is set to take effect on July 1, 2025.

Statutes affected:
Introduced: 67-3-901, 67-4-3201, 67-4-3205, 67-4-3206