§ 54-3-104 — Development and operation of user fee facility projects - Funding - Setting and collecting user fees

(a) The department may develop user fee facility projects and operate user fee facilities as provided in this chapter. The department may expend funds from the state user fee fund, the transportation modernization fund, and other funds, grants, or loans received from or made available by the federal government or another government agency that may be lawfully applied to a user fee facility project. (b) Subsection (a) applies to: (1) New transportation facilities constructed on or after July 1, 2023; provided, however, that a new transportation facility must include at least one (1) lane for use without payment of a user fee, and that at least one (1) lane for use without payment of a user fee must be operational in order to assess a user fee on any user fee lane within the transportation facility; and (2) Existing transportation facilities where one (1) or more new vehicle travel lanes are added to the facility on or after July 1, 2023; provided, however, that the existing number of lanes available for use without payment of a user fee must not be reduced. (c) The department may, subject to approval of the board, designate one (1) or more lanes of a highway, or portion of a highway, within the state as a user fee facility; provided, however, that such designation must not reduce the existing number of general purpose lanes and lanes available for use without payment of a user fee. In making such designations, the department, subject to the approval of the board, shall specify the high occupancy requirement or other conditions for use of the lanes, which may include restricting vehicle types and implementing access controls. (d) To establish a new user fee facility or to add a user fee facility on an existing facility, the department shall submit a proposal to the board. The proposal must include plans, feasibility analyses, and other such information as may be available to describe the proposed project and the need for such project, including: (1) Projected traffic on the user fee facility; (2) The anticipated amount of the user fee to be charged, or the method for setting variable user fees; (3) Projected user fee revenue; and (4) If applicable, the proposed use of a franchise agreement, concession agreement, or a combination of those agreements, to design, construct, finance, operate, or maintain the user fee facility. (e) The department may, subject to approval of the board, set user fees or establish the method for setting variable user fees for the use of managed lanes, subject to resolutions or indentures authorizing bonds. Upon or prior to the issuance of any bonds, and until such time as the bonds are no longer outstanding under the resolution or indenture providing for the issuance of the bonds, the department shall collect, or shall cause to be collected, such user fees and shall revise the user fees from time to time whenever necessary, to produce revenue, together with other moneys that may be available, sufficient to: (1) Provide for all costs of the development and operation of the user fee facility project, including reasonable reserves; and (2) Pay when due all bonds and interest on the bonds, obligations under hedging agreements and ancillary agreements, and other indebtedness incurred by the state for the payment of which the user fees have been pledged, charged, or otherwise encumbered, and interest thereon, including reasonable reserves therefor. (f) A user fee, along with allowable increases, or the method for setting variable user fees on managed lanes, imposed or collected on a user fee facility on a state highway that is the subject of a user fee development agreement must be set in the user fee facility development agreement. The department shall obtain the approval of the board prior to modifying the user fee conditions set forth in the user fee facility development agreement. (g) By July 1, 2024, and by July 1 annually thereafter, the department shall submit a report to the chairs of the finance, ways, and means committees of the house of representatives and the senate and the chairs of the transportation and safety committee of the senate and transportation committee of the house of representatives on the activities of the department under this chapter.

Legislative History

Amended by 2023 Tenn. Acts, ch. 159, s 19, eff. 4/17/2023. Acts 2007 , ch. 597, § 5.