NASHVILLE, Tenn. – Senator Paul Bailey (R-Sparta) announced today the signing of Senate Bill 1363, a bill reclassifying the property classification of certain telephone companies and telephone cooperatives. While parts of the law went into effect in early June, the remaining parts of the law will be enacted on July 1.
The law reclassifies telephone company and telephone co-operatives property so it is accessed at a commercial and industrial rate instead of a public utility rate.
“This will affect 60 telephone companies across the state, and many of them are in rural areas working toward expanding broadband, which is in line with the priorities and goals of the General Assembly,” said Sen. Bailey. “Telephone companies and telephone cooperatives are different than other public utilities in that their markets have been opened up to intense competition, and they are no longer monopolies like other utilities. This law provides a fix to a problem many individuals, groups and stakeholder have spent at least ten years searching for.”
The new law also redirects earmark revenue to local governments to make up for any shortfall in revenue from the reclassification and discontinues the telecommunication ad valorem tax reduction fund.
“I am proud to say that this law is the result of hard work, creativity and collaboration by local governments, telephone companies, the administration, the Department of Revenue and the Comptroller’s office to resolve a long-standing issue,” added Sen. Bailey.