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SB 1792

Highways, Roads and Bridges - As introduced, requires the commissioner of transportation to establish rules governing reimbursement of relocation costs to a utility; requires reimbursement of at least $2.5 million for projects with utility relocation costs exceeding $2.5 million; requires the department to approve a utility owner's plan to accomplish the proposed new location of utility facilities in highway rights-of-way if the proposal would effectuate the relocation at the lowest cost to the utility's ratepayers; makes other related revisions. - Amends TCA Title 4 and Title 54.

114th Regular Session (2025-2026)

Establishes a reimbursement framework for utility relocations in highway projects, including a $2.5 million minimum for large projects and TDOT review to protect ratepayers.

Passed on Second Consideration, refer to Senate Transportation and Safety Committee
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Bill Summary · SB 1792

Summary of Senate Bill 1792 (SB 1792), 114th Tennessee General Assembly

Overview

  • Title: Highways, Roads and Bridges - As introduced, requires the commissioner of transportation to establish rules governing reimbursement of relocation costs to a utility; sets a statutory floor of $2.5 million for projects with relocation costs exceeding $2.5 million; requires the department to approve a utility owner's relocation plan if the plan would relocate at the lowest cost to ratepayers; includes related revisions.
  • Jurisdiction: Tennessee
  • Primary focus: Reimbursement framework for utility relocations impacted by state highway projects, with an emphasis on cost protections for ratepayers and clarity in process.

Main Purpose and Intent

  • Codify and clarify the reimbursement framework for utility relocation costs when the Department of Transportation (TDOT) undertakes highway construction projects that require relocating utilities located within highway rights-of-way.
  • Establish a statutory minimum reimbursement floor of $2.5 million for large relocation projects, while preserving the department’s discretion to authorize higher reimbursements based on set criteria.
  • Ensure relocation plans are evaluated for cost-effectiveness to ratepayers, promote transparency, and provide a predictable process for utilities and the state.

Key Provisions and Changes

Definition and Scope

  • Expands and clarifies the definition of "utility" to include modern digital and broadband infrastructure (broadband internet, fiber optic, etc.), in addition to traditional utilities (electricity, water, gas, sewer, etc.).
  • Aligns statutory definitions with existing TDOT policy to reflect current practice rather than broadening the overall scope of reimbursable entities.

Reimbursement Rules (New Subsection (f) in §54-5-804)

  • Establishes rules under the Uniform Administrative Procedures Act for utility relocation reimbursements.
  • Reimbursement amounts:
    • Projects costing less than $2.5 million: actual relocation costs to the utility.
    • Projects costing $2.5 million or more: at least $2.5 million per project, with the commissioner allowed to authorize higher amounts.
  • Considerations for discretionary increases (f)(3) include:
    • Project size and complexity
    • Nature and extent of relocation work (engineering, design, permitting, construction)
    • Financial and service impacts on the utility and ratepayers
    • Potential effects on ratepayers and whether rates must remain just and reasonable
    • Extraordinary or unforeseen conditions (geography, environment, right-of-way constraints)
    • Effects of TDOT’s schedule, design requirements, and right-of-way timelines
    • Availability and cost of alternative relocation routes or methods
    • Other relevant factors to ensure costs are reasonable and do not unduly burden ratepayers
  • The reimbursable amount is the amount authorized by the rules in effect at the time the relocation contract is executed.

Department and Utility Responsibilities

  • TDOT must reimburse the utility for relocation costs (including if the utility relocates with its own staff or contractors), treated as part of the highway construction project cost, subject to the new rules.
  • Utilities must submit a relocation plan, cost estimate, and schedule to TDOT and comply with finalized plan requirements.

Plan Approval and Scheduling (Amendments to §54-5-854)

  • TDOT must approve the utility’s relocation plan and schedule if it would relocate at the lowest cost to ratepayers (reasonableness standard).
  • If the submitted plan is not reasonable, TDOT may direct the utility to install/relocate according to an approved plan and calendar-day schedule.
  • Notifications and timelines:
    • TDOT communicates approval or direction via certified mail.
    • TDOT sets the date the utility may begin relocation, with advance notice by certified mail.
    • Utilities may begin work only after all applicable regulatory approvals, with materials can be ordered in advance.
  • Dispute mechanism:
    • If parties cannot agree on a reasonable plan/schedule, the utility may proceed under a reservation-of-rights notice within 10 days, which becomes part of the administrative record.

Post-Completion Reimbursements

  • If additional relocations or adjustments are required after initial completion, TDOT reimburses the additional costs under the rules promulgated in §54-5-804(f).

Effective Dates

  • The act takes effect upon becoming law for rulemaking purposes.
  • For all other purposes, the act takes effect January 1, 2027.

Who Is Affected

  • Utilities that have facilities in public highway rights-of-way (including electric, water, gas, telecommunications, and broadband/fiber providers).
  • TDOT (as the administering agency for reimbursements and relocation planning).
  • Ratepayers served by these utilities (potentially affected by cost containment and rate impacts).

Procedural and Timeline Aspects

  • Rulemaking: TDOT to establish reimbursement rules under the Uniform Administrative Procedures Act (UAPA) for implementation.
  • Plan submission and approval process: Utility submits plan/cost/schedule; TDOT reviews for cost-effectiveness to ratepayers; approvals or directives issued via certified mail.
  • Financial floor with potential for higher reimbursements: At least $2.5 million for projects at or above that threshold; commissioner may authorize higher amounts based on listed considerations.
  • Effective dates: Rulemaking immediately upon law; broader applicability begins January 1, 2027.

Remarks

  • The bill reiterates and codifies existing TDOT practices and policy (Policy No. 340-07) rather than expanding scope or imposing new statewide costs.
  • It emphasizes protecting ratepayers, ensuring reasonable costs, and maintaining infrastructure progress, including broadband deployment.

Compiled from official sources — confirm details with the bill’s official record.

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