(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.
lawyer at desk

Ask a legal question, get an answer ASAP!
Click here to chat with a lawyer about your rights.

Terms Used In Tennessee Code 54-3-104

  • Ancillary agreements: means contracts or agreements facilitating the issuance and sale of bonds, including contracts or agreements providing for liquidity and credit enhancement and reimbursement agreements relating to the contracts or agreements providing for liquidity and credit enhancement. See Tennessee Code 54-3-103
  • board: means the board established in this chapter. See Tennessee Code 54-3-103
  • Bonds: means bonds, notes, renewal notes, refunding bonds, interim certificates, certificates of indebtedness, debentures, warrants, commercial paper, or other obligations or other evidence of indebtedness or evidence of borrowed money issued or entered into by or on behalf of the department to finance user fee facility projects. See Tennessee Code 54-3-103
  • Concession agreement: means an agreement between a public entity and a private entity, or a consortium of private entities, under which the private entity or consortium accepts responsibility for the design, construction, financing, operation, or maintenance of a user fee facility for a period of years, collects revenues from the user fee facility for that period, and accepts the risk of revenues being sufficient to support the private entity's or consortium's capital, operations, and maintenance costs for the user fee facility. See Tennessee Code 54-3-103
  • Department: means the department of transportation. See Tennessee Code 54-3-103
  • development: means a portion of the process of bringing a user fee facility project to completion, including, but not limited to, planning, feasibility analysis, environmental evaluation, preliminary engineering, design, acquisition of rights-of-way, relocation of utilities, permitting, environmental mitigation, contracting, funding, and construction. See Tennessee Code 54-3-103
  • Facility: means a highway, bridge, tunnel, parking lot or garage, or other paved surface or structure that is designed to carry or contain land transportation vehicles, or another transportation-related facility. See Tennessee Code 54-3-103
  • Franchise agreement: means an agreement between a public entity and a private entity, or a consortium of private entities, under which the private entity or consortium accepts responsibility for the design, construction, operation, or maintenance of a user fee facility for a period of years in exchange for payment from the public entity, which may include, but is not limited to, periodic availability payments from the public entity. See Tennessee Code 54-3-103
  • fund: means each separate fund established in this chapter, or all such funds, as the context may require, and includes accounts and subaccounts in the fund or funds. See Tennessee Code 54-3-103
  • Hedging agreements: means interest rate swap or exchange agreements, agreements establishing interest rate floors or ceilings, or both, and other interest rate hedging agreements relating to bonds. See Tennessee Code 54-3-103
  • Highway: includes public bridges and may be held equivalent to the words "county way" "county road" or "state road". See Tennessee Code 1-3-105
  • operation: means activity associated with the management, operation, and maintenance of a completed user fee project, including, but not limited to, collecting user fees. See Tennessee Code 54-3-103
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • User fee: means a fee or charge for the use of a user fee facility. See Tennessee Code 54-3-103
  • User fee facility: means a facility where the development or operation of the facility is wholly or partially funded with user fees. See Tennessee Code 54-3-103
  • User fee facility project: means a capital project involving the development or operation of a user fee facility. See Tennessee Code 54-3-103
  • User fee lane: means a highway lane that may be used by an operator of a vehicle if the operator pays a user fee. See Tennessee Code 54-3-103
  • User fee revenue: means revenues or moneys received from the collection of user fees. See Tennessee Code 54-3-103
  • User fees: Fees charged to users of goods or services provided by the government. In levying or authorizing these fees, the legislature determines whether the revenue should go into the treasury or should be available to the agency providing the goods or services.
(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.
  Previous section
Next section  
 Chapter 3 Contents