TCSA Capitol Update: April 2, 2026

This week’s Capitol Update covers a fast-moving stretch of legislative activity with significant implications for Tennessee’s counties—particularly in education funding, land use authority, and local governance.

📚 We begin with developments surrounding Senate Bill 2247 and House Bill 2532, which would expand the state’s Education Freedom Scholarship program. Lawmakers are weighing competing versions of the proposal, with key differences in the number of additional scholarships and changes to protections for public school funding. As budget negotiations ramp up, these details will be critical to watch.

🏛️ In the Senate State and Local Government Committee, several bills impacting county operations saw action. A proposal to eliminate rollback penalties on greenbelt properties failed, while legislation addressing development restrictions was sent to summer study. Meanwhile, a bill establishing a state-funded training incentive for local correctional officers moved forward, and another proposal that would prohibit county employees from serving on county commissions advanced with a delayed implementation date.

⛰️Land use and growth management also remain a central focus. Lawmakers continue to refine legislation that would impose timelines on development approvals, while a separate bill granting local governments more authority over quarry and digital asset mining locations is expected to see floor action soon.

Finally, we cover legislation that would require local governments to obtain approval from the attorney general before entering contingency fee agreements for legal services—adding a new layer of oversight that could impact how counties pursue complex litigation.

As always, stay tuned—final decisions on many of these issues will come down to budget negotiations and upcoming floor votes.

👉 Visit https://tncounties.org for more information.

Note: Due to the holiday schedule, this episode was recorded earlier in the week and may not reflect late-breaking developments. For the latest updates, visit tncounties.org.

©️ 2026 Tennessee County Services Association

For more information, visit www.tncounties.org

Transcript

SPEAKER_00 0:00

Welcome to the TCSA Capital Update for the week of March 30, 2026. We'll start things off this week by covering education-related bills facing committees in both the Senate and House. The House Finance Subcommittee and Senate Finance Committee both moved forward with legislation Senate Bill 2247 and House Bill 2532 to expand the Governor's Education Freedom Scholarship Program that provides state funds to offset the cost of private school tuition. When the bill passed last year in a special session, it authorized 20,000 private school scholarships with an automatic provision to provide 5,000 more in year two if all 20,000 are used. In his state of the state address, Governor Lee announced his desire to double the number of scholarships to 40,000 in year two. This confirmed the fears of many critics of the program last year who cited the fact that these programs tend to expand rapidly in other states. At roughly $7,500 per student, another $20,000 scholarships would cost the state $150 million. The Senate Committee approved the bill in its original form to authorize the additional $20,000 scholarships. The House Subcommittee shaved $5,000 off that number, approving the bill with $15,000 additional scholarships. The House version of the original legislation last year also included an amendment to the so-called funding floor that was included in the bill to protect funding for public schools. Many former opponents of private school vouchers changed their position and voted for the bill last year because it included a provision that local schools would not lose funding due to enrollment decline. Under the language of the amendment added to the current bill in the House, LEAs would only be eligible for that hold harmless payment if the school system could verify that students leaving their system were U.S. citizens or were in the country legally. It remains to be seen whether the Senate will go along with these provisions. Both the number of scholarships and any changes to the funding floor for public schools will likely be a part of final budget negotiations, which are expected to be finalized over the next two weeks. Moving on to the Senate, State and Local Government Committee action, the committee entered this week with 22 remaining bills. This is after the committee worked through the bulk of its final calendar last week. For this week, though, Senate Bill 1824, which is a bill that would have eliminated the rollback penalty for properties converted out of Greenbelt, was narrowly defeated in the committee. This bill would have cost county governments an indeterminate amount of revenue. Another proposal, Senate Bill 1045, that placed additional restrictions on what a local government can require of a developer, was sent to Summer Study for additional review. This topic was the subject of a TOSER study in legislation just a few years ago. Senate Bill 1685, a third bill heard by the committee, that would have allowed non-conforming uses to be completely reconstructed without conforming to current regulations, ended up not being presented after appearing on the calendar for weeks. It appeared that bill was inspired by a specific situation in one city, but the bill had statewide application. The committee also approved Senate Bill 2587, which creates a training incentive program for correctional officers in local jails. It would mirror the training supplement paid to post officers and would be funded by the state. One of the last items heard by the state and local committee before it closed was a pair of bills, Senate Bill 2591 and House Bill 2003 19, brought by its chairman, that prohibits county employees from serving on the county commission. It narrowly passed out of the committee, with five votes in favor after an amendment was added to push back the effective date of the bill to January 1, 2027. The sponsor acknowledged that county elections are underway this year and the bill could complicate matters if it took effect in the midst of that process. Under the bill, a county employee serving on the county commission when it takes effect could continue to serve until the conclusion of their term. So, with the amendment, a county employee elected to the county commission this fall could serve for four or four years, but would then be disqualified from serving after that term. The bill is scheduled to be heard in the House State and Local Committee on its final calendar next week on April 8th. When it comes to land use regulations, there were a large number of proposals this year related to local governments' ability to enact and enforce land use regulations and manage growth. Senate Bill 2237 and House Bill 2552, which is an administration bill that sets time limits for approving development applications, plans, and site inspections, raise serious concerns for counties as it was initially filed. Individual counties and the associations have been working back and forth with the administration on amendments to address concerns. A recent proposed amendment has fixed a number of these problems. The bill is ready to go to the Senate floor for a final vote. In the House, the bill was placed behind the budget due to a small associated cost. A separate bill, Senate Bill 2053 and House Bill 1827, which grants local governments the ability to approve the location of any quarry or digital asset mining facilities in a public meeting, is ready for a floor vote in both chambers, but it has been delayed multiple times. It is expected to be voted on in the House on April 6th. Finally, this week, Senate Bill 2418 and House Bill 2069, which would require cities and counties to get the approval of the Attorney General before bringing a lawsuit through a contingency fee agreement, was approved by the House, State and Local Government Committee. Many cities and counties used these types of agreements with law firms when they filed opioid lawsuits. The bill was being promoted by the Tennessee Chamber of Commerce as a way to protect businesses from nuisance lawsuits. It would require any political subdivision wanting to enter a contract for legal services under a contingency fee agreement to hold a public hearing and make written determinations of the need for the agreement and the reasons why the legal staff of the political subdivision could not bring the action or fund the action through a traditional hourly fee arrangement. Once the political subdivision decides to move forward, the attorney general would then have 90 days to approve the agreement or refuse to approve the agreement. If the AG takes no action, the contract is deemed approved. The bill, as amended, also applies to contingent fee agreements in effect prior to the date of the bill, requiring local governments to submit the information to the Attorney General for approval by July 1, 2026. Please note that due to the upcoming holiday, this capital update is being shared earlier this week and may not have the latest information on developments that were still underway on Thursday morning. Visit www.tncounties.org for more information and have a wonderful Easter weekend.