Session wrap-up
The 112th General Assembly concluded its business and adjourned sine die on Thursday, April 28. Farm Bureau certainly had a successful session as three priority issues passed with strong votes and have been signed by Governor Lee. Much of this success can be credited to our grassroots members who advocated on Farm Bureau’s behalf. We encourage you to thank your state legislators for their hard work and support of Farm Bureau issues this session.
MODERNIZATION OF AGRICULTURE SALES TAX PASSES:
The Tennessee Farm Bureau Federation enthusiastically applauds the Tennessee General Assembly for unanimously passing the Modernization of Agriculture Sales Tax (SB905 Stevens/HB1405 Halford).
As amended, this legislation will provide much needed clarity and certainty on the tax status for both farmers and the businesses from which farmers purchase input items. As a result, qualified farmers will be able to purchase some input items which have previously been denied an exemption. The new exemption language more closely aligns to the process used in manufacturing and eliminates wording that previously resulted in unfavorable agency interpretations.
“We are extremely grateful to the members of the Tennessee General Assembly, especially the sponsors of this bill, for their support of Tennessee farmers,” said Tennessee Farm Bureau Federation President Eric Mayberry. “This was a top priority issue for our organization. For many years, the confusion, inconsistent taxation and resulting uncertainty has been frustrating to farmers, retailers and the Tennessee Department of Revenue. Farmers can now focus on what they do best – providing food, fiber and fuel for all of us.”
Going forward, all items used to cultivate, produce, harvest, process, market and transport agricultural commodities will be exempt from sales tax for qualified farmers with the Tennessee Department of Revenue. Several items farmers believed should be exempt were not covered under the previous law and will now be exempt from sales tax for qualified farmers. To use this exemption, individuals must still apply and receive a qualified farmer exemption card from the Tennessee Department of Revenue. Farmers who currently have an agriculture exemption certificate will not need to reapply. The Department of Revenue reissues agricultural certificates of exemption every four years without action by the farmer.
Automobiles, trucks, household appliances and gasoline or diesel used in vehicles operated upon the public highways ARE NOT exempt today and the status does not change with this bill.
Tennessee Farm Bureau thanks Senator John Stevens and House Agriculture and Natural Resources Committee Chairman Curtis Halford for sponsoring this critical legislation and the Tennessee General Assembly for including it in the budget and passing the bill as amended. We look forward to the benefit it will provide to the more than 66,000 farms across Tennessee. More information will be provided on how this law will operate as guidance from the Tennessee Department of Revenue is developed.
The Modernization of Agriculture Sales Tax law will take effect January 1, 2023.
PARTITION OF HEIRS PROPERTY:
SB2167 Stevens/HB2612 Farmer – Uniform Partition of Heirs Property Act passed the House 93-0 on Tuesday, April 27. It passed the Senate 31-1 on April 11. The legislation creates a court process to resolve family property disputes. If a sale of the property is the result, then the judge has discretion to determine the method of sale which is most economically advantageous and in the best interest of the cotenants as a group. The method of sale may be an open-market sale, a sale by sealed bids or an auction. This legislation takes effect July 1, 2022.
TACIR STUDY ON UTILITY SCALE SOLAR FACILITIES:
SB2797 Walley/HB2761 Gant – TACIR Study on Utility Scale Solar Facilities passed the House 86-6 on Tuesday, April 27. It passed the Senate 33-0 on March 14, but the House version extended the deadline for which the study must be completed from January 31, 2023 to September 30, 2023 to allow for a more comprehensive analysis. The Senate concurred with the House amendment with a vote of 31-0. It was signed by the governor on May 11.
In addition to this legislation, Farm Bureau was involved with SB1925 Walley/HB2056 Hurt which puts in place guidelines for the construction, installation, operation and decommissioning of solar facilities. This bill passed the Senate 31-0 on March 7, passed the House 91-0 on March 28 and was signed by the governor on April 14. It went into effect June 1, 2022.
GREENBELT ACREAGE CAP INCREASE:
Farm Bureau policy supports increasing the Greenbelt acreage cap to more accurately reflect the increasing size of today’s farms. SB1282 Niceley/HB1445 T. Hicks aimed to increase the acreage limit. A compromise could not be found on the number of acres which could be placed under Greenbelt in working with local government representatives, so this legislation was not pursued this session.
