House Bill 402 amends Tennessee law to establish a property tax exemption for real property that provides tree canopy coverage. The bill defines key terms such as "tree canopy," "implementing agency," and "tree dripline," and outlines the process for property owners to apply for the exemption. The implementing agency, which may include the county planning commission or assessor of property, is responsible for determining the extent of tree canopy coverage using reliable assessment methods. The exemption applies only to the portion of the property that provides tree canopy, and the county government has the discretion to apply the exemption to residential, commercial, or both types of properties.

The bill also details the application process, including requirements for filing with the state board of equalization and the assessor of property. It stipulates that the exemption is not transferable and must be reported if there are changes in property use or ownership. The exemption can last for up to seven years, with the possibility of renewal if the implementing agency deems it reasonable. Additionally, the bill requires a two-thirds majority vote from the county governing body for the provisions to take effect.