General Assembly Gaveled Into Session - Jeremy Elrod

By Jeremy Elrod 

 

The legislature was gaveled in at noon on January 9. Since it’s the second year of the 110th General Assembly, legislators are expected to get right to work with committee meetings scheduled for next week. The governor is likely to give his final State of the State address to the legislature on January 30, followed by six weeks of House and Senate budget hearings. Legislative leaders anticipate to finish their business around the second week of April. The bill filing deadline, when all legislators have to have their legislation filed by, is February 1. The legislature is seeing big changes this year. There has been some turnover among the membership since adjournment in May (three new senators and two new representatives), with dozens of legislators announcing plans for not seeking reelection or seeking other elected offices this year (check our latest update). The biggest change is the entire legislature has moved out of Legislative Plaza and War Memorial Building and into the Cordell Hull Building located on the east side of the State Capitol. The building has been fully renovated after it was initially slated for demolition. The new building is quite an upgrade from the previous accommodations, but it will still need some getting used to for legislators, staff, and lobbyists. It’s a welcome change, for sure.

Collecting Sales Tax on Utility Fees 

First the first time ever, sales tax may be required to be collected on some utility fees due to some recent actions of the Tennessee Department of Revenue. After an audit for the city of Lebanon that determined the city should be collecting sales tax on water connection and re-connection fees, the Department has issued draft guidance on which utility fees are required for sales tax be collected. TMEPA is part of a coalition of utility association (Tennessee Association of Utility Districts, Tennessee Electric Cooperative Association, Tennessee Gas Association, Tennessee Municipal League) that has met with the Department and has been meeting and regularly communicating about how to deal with this new requirement, which would apply to non-residential electric and gas services and all water service. TMEPA and other utility associations have given the Department written comments about our concerns of this new requirement and on the draft guidance the Department has put together. All utility associations, including TMEPA, will be filing and supporting a piece of legislation that prevents this requirement from going into effect so that sales tax will not be collected on any utility fees. The bill will be filed soon with sponsors being finalized. 

Small Cell Legislation to Be Filed

With wireless companies needing more capacity and working to bring 5G to market, there is a growing need to build more of the wireless infrastructure to handle the increasing traffic and speeds. Instead of the traditional large antennas, wireless companies are using small cell antennas that can be located on utility poles or street lights. These small cell antennas are new with utilities figuring out how to deal with them. At the urging of wireless companies, several states have passed legislation that regulates how local governments and utilities handle small cells. Each state’s legislation is different, but many of them deal with similar issues: a shot clock on responding to permits, restricting or prescribing what fees can be, restricting how local governments can regulate siting and the look of small cell antennas, and other issues. We have confirmed legislation will be filed in Tennessee in the coming weeks at the urging of wireless companies. We have not seen the legislation yet, but we are already talking with legislators about our concerns with state regulation in this area. 

 

Bills Adding Board Members

Last year saw two bills (HB269 and SB1247) that would have required municipal utility boards to add members outside their municipality. Those bills didn’t pass this year but are still technically alive, and now a new one will be filed that will be directed only at Lenoir City Utility Board (LCUB). Rep. Brooks sponsored HB269 last year to target LCUB, but the bill as written applied statewide. This year he will be sponsoring a new bill aimed at the utility, and according the Rep. Brooks the bill as drafted will only affect LCUB’s board makeup and the cities and counties it pays its PILOT to. We have been in discussion with Rep. Brooks, and we will stay on top of this important issue that would affect so many TMEPA members.

Broadband Bills Unlikely This Year

Last year the legislature passed the governor’s Tennessee Broadband Accessibility Act, which allows electric cooperatives to offer internet service and provides for grants and tax breaks to expand broadband service. This was a significant piece of legislation after years of municipal electric broadband providers seeking passage of bills that would allow them to serve broadband outside of their electric service area. Due to last year’s broadband bill’s passage, this year is unlikely to see any significant broadband legislation given serious consideration.