2022 Legislative Report
The Tennessee Bankers Association is pleased to present this review of 2022 Tennessee legislation affecting the banking industry or that may be of general interest to Tennessee bankers. Each entry includes a public chapter summary, link to the full text, and effective date.
Please contact Amy Heaslet if you would like more information about any of these new laws and the impact they may have on your bank.
The LIBOR Discontinuance Act
SB 2133 / HB 2110
Effective Date: 3/15/2022
This enacts The LIBOR Discontinuance Act, which provides for how certain financial contracts will be governed after the publication of LIBOR is discontinued; and authorizes the Secured Overnight Financing Rate (SOFR), published by the Federal Reserve in NY, as the recommended benchmark replacement.
Unique Identifier Rather than State License Number Required of Mortgage Lenders, Brokers
SB 1922 / HB 1668
Effective Date: 7/1/2022
Requires a mortgage lender or mortgage loan broker to ensure that each application for a residential mortgage loan contains the unique identifier, instead of the state license number, of the applicable mortgage lender, mortgage loan broker, or mortgage loan originator.
Remote Work for Mortgage Brokers, Lenders
SB 2526 / HB 2304
Effective Date: 7/1/2022
Specifies the conditions under which an employee of a licensed mortgage lender, mortgage loan broker, or mortgage loan servicer may perform licensable activities at an unlicensed or unregistered remote location.
Contracts with State Depositories with Anti-Fossil Fuel Policies
SB 2649 / HB 2672
Effective Date: 7/1/2022
Prohibits the state treasurer from entering into a contract with a bank for cash management services if the bank has a policy prohibiting financing to companies in the fossil fuel industry.
Collateral Pledging Requirements for Public Deposits
SB 2252 / HB 2426
Effective Date: 5/25/2022
Allows banks to pledge SBA bonds as collateral for public deposits; streamlines the requirements for pledging out-of-state bonds as collateral; and clarifies that the Collateral Pool Board has authority to vote to reduce the pledge levels for member banks in certain situations.
Businesses with COVID-19 Vaccine Policies
SB 1823 / HB 1867
Effective Date: 3/11/2022
Requires certain employers with a mandatory COVID-19 vaccination policy to grant exemptions based on medical reason or religious reason; and makes other related changes.
Remote Meetings of Nonprofit Corporations
SB 1931 / HB 2047
Effective Date: 7/1/2022
Authorizes the members and proxyholders of nonprofit corporations to meet remotely under certain circumstances.
Workers Comp – Filing of Annual Certified Financial Statements
SB 2353 / HB 2463
Effective Date: 3/24/22
Extends the deadline from the last day of the sixth month following the end of the fiscal year to the last day of the ninth month, for an employer to file an annual certified financial statement with the department of commerce and insurance for purposes of showing the employer’s ability to pay all workers compensation claims that may arise against the employer.
Contracts with Public Entities
SB 1993 / HB 2050
Effective Dates: 4/8/2022; 7/1/2022
Prohibits a public entity from entering into a contract with a company unless the contract includes a written certification that the company is not currently engaged in, and will not for the duration of the contract engage in, a boycott of Israel; and provides exemptions for contracts with a total value of less than $250,000 and contractors with fewer than 10 employees.
Cancelation of Subscription Services
SB 2279 / HB 1652
Effective Date: 1/1/2023
Requires a business that allows someone to sign up for a service or subscription online to provide the option to cancel the service or subscription online without additional steps; and creates certain exceptions, including one for state and national banks.
E-Verify Requirements
SB 1780 / HB 1853
Effective Date: 5/9/2022
Lowers the threshold for private employers having to verify work authorization status of new hires through E-Verify from those with 50 or more employees to those with 35 or more employees; requires the office of employment verification assistance to offer, at no charge, E-Verify sign ups and work authorization status checks for employers with less than 35 employees; protects employers acting upon false results generated by E-Verify; prohibits certain wrongful or retaliatory discharge or discrimination actions; and prohibits certain rehires.
Creation of Decentralized Autonomous Organizations
SB 2854 / HB 2645
Effective Date: 4/20/2022
Enacts provisions governing and authorizing decentralized autonomous organizations as LLCs and prescribes how a DAO may be formed, including by operating agreement or smart contract; and dissolved; authorizes an LLC formed under the Tennessee Revised Limited Liability Company Act to convert to a DAO by amending its articles of organization; and provides that membership interests in a DAO are calculated by dividing a member’s contribution of digital assets to the DAO divided by the total amount of digital assets contributed to the DAO at the time of the vote.
Veterans’ Day as Recognized Holiday
SB 2879 / HB 2733
Effective Date: 4/20/2022
Requires an employer to allow a veteran employee to have the entirety of Veterans’ Day as a non-paid holiday if certain conditions met; and specifies that this act does not prohibit an employer from allowing the employer’s veteran employees to have the entirety of Veterans Day as a paid holiday.
Vendors Comp for Sales Tax Collection
SB 500 / HB 536
Effective Date: 7/1/2022
Creates a one-year vendors comp program from July 1, 2022, through June 30, 2023, where retailers may retain a certain portion of the sales and use tax due to the department of revenue before remitting it to the state (up to $25 per location and a maximum of $300 per retailer).
Extension of COVID Liability Protections for Businesses
SB 2448 / HB 2671
Effective Date: June 1, 2022
Extends the termination date from July 1, 2022, to July 1, 2023, for limitations on claims against a person or business for loss, damage, injury, or death arising from COVID-19.
Re-Writes the Small Estate Act
SB 888 / HB 1362
Effective Date: 7/1/2022
Enacts the “Small Estate Affidavit Limited Letter of Authority Act,” which is a rewrite of “The Small Estates Act”, that among other things, clarifies that small estates can only have personal property, not real property, and allows for the conversion to full probate estate administration if there is real property.
Improvement Trust Fund – Separate Trust for Each Cemetery
SB 1934 / HB 2352
Effective Date: 4/14/2022
Specifies that a trustee for an improvement care trust fund may establish a separate trust for each individual cemetery or cemetery company, or a master trust for multiple cemetery companies; specifies that a trustee for pre-need cemetery contracts may establish a separate trust fund for each contract, a single trust fund for all contracts written by an individual cemetery, or a single trust fund for all contracts written by multiple cemetery companies; and makes other changes related to the establishment and management of an improvement care trust fund or a trust fund for a pre-need cemetery contract.
Administration of Estates – Homestead Exemption
SB 2015 / HB 2063
Effective Date: 7/1/2022
For purposes of a spouse’s elective share, increases the amount that must be held as homestead from the sale of real estate that is so situated that homestead cannot be set apart from $5,000 to $35,000; does not make any changes to the homestead exemption relative to bankruptcy.
Court Appointment of Public Receiver
SB 1680 / HB 1665
Effective Date: 7/1/2022
Authorizes a probate court or chancery court to appoint a public receiver to determine and submit a recommendation to the court on the need for a temporary or permanent receiver over an estate; and authorizes the court, upon a hearing on the report, to appoint a receiver with such powers as are necessary, consistent with those extended to receivers in absentees’ estates.
Holographic Will – Suspicious Circumstances
SB 2242 / HB 2284
Effective Date: 7/1/2022
Creates a presumption of suspicious circumstances if a holographic will is written within 30 days prior to a testator’s death by suicide and places the burden of presenting evidence that the testator had the capacity to execute the will on the proponent of the will.
Account Statements of Fiduciaries
SB 1799 / HB 2359
Effective Date: 4/29/2022
Specifies that confidential medical information must not be disclosed in the accounting statement of a fiduciary when the fiduciary advises the court whether or not the condition of the respondent continues to require the fiduciary’s services.
Court’s Interpretation of Statutes
SB 2285 / HB 1749
Effective Date: 4/14/2022
Provides that in interpreting a state statute or rule, a court presiding over the appeal of a judgment in a contested case must not defer to a state agency’s interpretation of the statute or rule and must interpret the statute or rule de novo; and after applying all customary tools of interpretation, the court must resolve any remaining ambiguity against increased agency authority.
Enacts the Uniform Partition of Heirs Property Act
SB 2167 / HB 2612
Effective Date: 7/1/2022
Enacts the “Uniform Partition of Heirs Property Act,” which applies to partition actions filed on or after July 1, 2022, and requires the court, in an action to partition real property, to determine whether the property is heirs property and, if it is heirs property, then the property must be partitioned unless all of the cotenants otherwise agree in a record; requires the court, after determining that the property that is the subject of a partition action is heirs property, to determine the fair market value of the property by ordering an appraisal; and specifies other requirements for determination of value and a process for a cotenant buyout and partition alternatives.
State Lending Transparency Act
SB 1692 / HB 1845
Effective Date: 7/1/2022
Enacts the “State Lending Transparency Act,” which requires the comptroller, at the end of each fiscal year, to report on all state lending programs and state credit support programs in a single document, including a cite to each individual lending program’s statutory authority. Requires the department of finance and administration division of budget to include certain items in the proposed state budget for each year, including the likely changes in returns or likely defaults from state lending and state credit support programs from the previous fiscal year as either new expenses or new revenues.
Capital Outlay Notes
SB 1875 / HB 1864
Effective Date: 4/14/2022
Authorizes capital outlay notes to be refunded with public building authority loans, subject to review by the comptroller; and makes other revisions to provisions governing bonds and notes issued by local governments.
Local Government Investment Pool Updates
SB 2122 / HB 2130
Effective Date: 4/14/2022
Specifies the powers that the state funding board may exercise with respect to the local government investment pool, including establishing limits, restrictions, or conditions on the acceptance of moneys into and the withdrawal of moneys from the fund and other various powers; and makes other related revisions to the administration of the local government investment pool.
Divestment of Certain Governmental Investments
SB 2639 / HB 2743
Effective Date: 4/20/2022
Authorizes the investment committee for the TCRS board of trustees to cause the retirement system to divest, as expeditiously as possible, from an investment the system has with an entity found to be doing business with or supporting a country sanctioned by the office of foreign assets control.
Motor Vehicle Titling
SB 2884 / HB 2542
Effective Date: 7/1/2022
Increases, from $5.50 to $8.50, the fee paid to county clerks for receiving and forwarding to the motor vehicle division of the department of revenue each application for certificates of title; and allocates $3.00 of the fee to be used by the county for the provision of services directly related to titling and registration.
Contracts with State Depositories with Anti-Fossil Fuel Policies
SB 2649 / HB 2672
Effective Date: 7/1/2022
Prohibits the state treasurer from entering into a contract with a bank for cash management services if the bank has a policy prohibiting financing to companies in the fossil fuel industry.
Collateral Pledging Requirements for Public Deposits
SB 2252 / HB 2426
Effective Date: 5/25/2022
Allows banks to pledge SBA bonds as collateral for public deposits; streamlines the requirements for pledging out-of-state bonds as collateral; and clarifies that the Collateral Pool Board has authority to vote to reduce the pledge levels for member banks in certain situations.
Lien for Taxes
SB 1854 / HB 1906
Effective Date: 3/28/2022
Specifies that, in addition to deeds of trust, deeds recorded prior to state liens for taxes or fees are superior to the state lien.
Cancelation of Time Share Contracts
SB 2132 / HB 2288
Effective Date: 1/1/2023
Allows for notice of cancellation of a time-share contract being made by email.
Cancelation of Contract Based on Unsolicited Offer to Purchase Property
SB 1945 / HB 1946
Effective Date: 7/1/2022
Authorizes an offeree to cancel without penalty a contract or agreement that was entered into as the result of an unsolicited offer to purchase the offeree’s real property that was sent through the mail; requires a sworn affidavit executed by the offeree contemporaneously with the offeree’s execution of the deed and other documents of conveyance of the title for the offeree’s right of cancellation to be waived; provides that any such affidavit is conclusive evidence of an offeree’s waiver of the right to cancellation; and establishes a violation of such is an unfair and deceptive act or practice under the Consumer Protection Act of 1977.
Nondisclosure of Real Property Owners’ Names on Online Database
SB 2695 / HB 2597
Effective Date: 1/1/2023
Authorizes an assessor of property to display “UNLISTED” for the first and last name in the ownership field of an online searchable database of property when certain conditions are met; and provides that an assessor is not prohibited from responding to an open records request regarding the subject property or from providing other information otherwise available for public inspection through such a request.
Equalization Board Appeals
SB 1677 / HB 1729
Effective Date: 3/18/ 2022
Authorizes the executive secretary of the state board of equalization to manage appeals before the board; authorizes the board, the executive secretary, or the executive secretary’s designee to determine if a property no longer qualifies for a property tax exemption or to modify the tax-exempt status of a property; and makes other related revisions
Deeds and Transfer Tax
SB 2086 / HB 2196
Effective Date: 4/19/22
Clarifies that a deed is treated as a quitclaim deed for transfer tax purposes if the deed only conveys the grantor’s interest to the grantee, and that a deed containing language evidencing an intent to convey the property itself or warranties of title is taxed as a transfer of a freehold estate; and specifies that the recordation tax provisions do not affect the validity of the underlying transfer or conveyance.
Prepayment of Property Taxes
SB 2772 / HB 2467
Effective Date: 4/20/2022
Authorizes county trustees to accept prepayments of property taxes.
Vendors Comp for Sales Tax Collection
SB 500 / HB 536
Effective Date: 7/1/2022
Creates a one-year vendors comp program from July 1, 2022, through June 30, 2023, where retailer
s may retain a certain portion of the sales and use tax due to the department of revenue before remitting it to the state (up to $25 per location and a maximum of $300 per retailer).
Professional Privilege Tax Elimination for Physicians
SB 884 / HB 519
Effective Date: 5/27/2022
Eliminates the $400 per year professional privilege tax for physicians for tax due and payable after May 31, 2023.
Elimination of Sales Tax on Sale of Gold, Silver, and Bullion
Exempts certain sales of gold, silver, platinum, and palladium coins and bullion from the sales and use tax.
SB 1857 / HB 1874
Effective Date: 5/27/2022
Updates Reporting by the Vulnerable Adult Protective Investigative Team
SB 439 / HB 630
Effective Date: 5/27/2022
Revises provisions governing the vulnerable adult protective investigative team annual report to the chairs of the judiciary committee of the senate and the judiciary committee of the house of representatives; and requires the executive director of the commission on aging and disability to establish and maintain a registry containing the names and addresses of unlicensed facilities that have been determined by a state agency to be providing care to elderly or vulnerable persons without maintaining the appropriate licensure.
Extends Validity of Temporary Motor Vehicle Plates
SB 1996 / HB 2044
Effective Date: 7/1/2022
Increases, from 30 days to 60 days, the initial period of time a temporary plate issued by a dealer is valid for a motor vehicle; and increases the fee for such plate from $5.50 to $6.50.
Campaign Finance Law Updates
SB 1005 / HB 1201
Effective Dates: 5/27/22; 7/1/22; 8/15/22; 1/16/22
Revises various provisions relative to ethics and campaign finance laws, including providing additional transparency for activities of 501(C)(4) organizations’ campaign funding and imposing new requirements that businesses that contribute corporate dollars keep those funds in separate accounts and imposing personal liability on any person who controls those funds. To read a comprehensive summary of the legislation prepared by the TN Registry of Election Finance, click here.
Enacts the “TN Broadband Investment Maximization Act of 2022”
SB 2480 / HB 2608
Effective Date: 5/31/2022
Creates the “Tennessee Broadband Investment Maximization Act of 2022” which its intent is to maximize the impact of the historic public and private sector investments in broadband anticipated to be made in this state during the next three years; allows the exemption from the sales and use tax on purchases and leases of all equipment, machinery, software, ancillary components, appurtenances, accessories, or other infrastructure that is used to provide broadband communication services and internet services; and requires the commissioner of revenue to reimburse counties and municipalities for loss of revenue resulting from the tax exemption provided for in this bill.
