House Bill 1873 amends Tennessee Code Annotated regarding real property taxes by introducing new limitations on how local governments can increase their property tax rates. Specifically, the bill prohibits local governments from raising their real property tax rates in a manner that would result in total revenue increases exceeding inflation plus two percent (2%) or inflation plus six percent (6%) over the preceding three tax years, unless approved by a referendum election. The bill outlines the process for holding such a referendum, including the requirement for a two-thirds vote from the governing body to call for the election and the necessary details to be included in the resolution or ordinance.

Additionally, the bill modifies existing provisions related to the fixing of tax amounts by county legislative bodies and ensures that the new limitations on tax increases remain in effect. It also establishes procedures for levying tax rates that exceed the certified tax rate, requiring public notice and compliance with the new limitations. The act is set to take effect on July 1, 2026, and will apply to all tax years beginning on or after that date.

Statutes affected:
Introduced: 67-5-102(a), 67-5-102, 67-5-102(c), 67-5-103, 67-5-1702