Public Funds and Financing - As introduced, requires the state treasurer to allocate and deposit 10 percent of the investment income earned by the state pooled investment fund each fiscal year to the state highway fund. - Amends TCA Section 9-4-603.

114th Regular Session (2025-2026) Introduced by Ferrell Haile

The bill transfers 10% of SPIF investment income each year to the State Highway Fund, increasing highway funding by about $75 million annually starting FY 2025-26.

Placed on Senate Finance, Ways, and Means Committee calendar for 4/21/2026

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Purpose and intent

The bill requires the Tennessee State Treasurer to allocate and deposit 10% of the investment income earned by the State Pooled Investment Fund (SPIF) each fiscal year to the State Highway Fund.

Mechanically, it directs transfer of a portion of SPIF earnings to highway funding, shifting a share of earnings away from the General Fund toward transportation infrastructure.

Key provisions

New subsection (j) added to Tenn. Code Ann. § 9-4-603:

On or before June 30 of each year, the Treasurer must allocate and deposit 10% of the SPIF investment income for that fiscal year into the State Highway Fund.

Effective date:

Takes effect upon becoming law (no delay required by other provisions).

Legislative framing:

Clarifies that this transfer is notwithstanding any other law to the contrary.

Who is affected

State Treasurer: Responsible for calculating and executing the annual transfer (10% of SPIF investment income).

State Highway Fund: Receives a new annual infusion of funds derived from SPIF earnings.

General Fund: Anticipated reduction in income recognized from SPIF earnings, since 10% of SPIF income is redirected to the Highway Fund.

SPIF participants (the state’s pooled investors): Their earnings remain tied to SPIF performance, but a share of those earnings (10%) is reallocated to highways rather than General Fund purposes.

Financial and fiscal impact

Fiscal notes indicate a transfer of 10% of SPIF investment income to the Highway Fund beginning in FY 2025-26 (the first full year impacted).

Estimated revenue impact:

State Highway Fund (gain): $75,000,000 in FY 25-26 and in subsequent years (assuming SPIF earnings of about $750,000,000 in those years).
General Fund (loss): Corresponding decrease in General Fund earnings by the same amount (since 10% is removed from SPIF earnings used for General Fund budgeting).

Historical context for SPIF earnings (used for projection):

FY 22-23: SPIF earnings allocated to General Fund ≈ $768.9 million
FY 23-24: ≈ $1,079.2 million
FY 24-25: ≈ $931.4 million
Projection used in analysis: ~ $750.0 million for FY 25-26 (basis for 10% transfer calculation)

Administration: The Treasurer can complete transfers using existing resources; no new explicit administrative funding is appended.

Procedural/timeline notes

Legislative history and action:

Introduced as SB 2569 (Senate) / HB 2326 (House) in 2026.
Passed first reading and second consideration in February 2026; referred to committees (Senate Finance, Ways, and Means).
Placed on committee calendars for April 2026 meetings.

Effective date: Upon becoming law; no separate phase-in or transition period specified.

Overall effect

The bill redirects a portion of SPIF earnings to fund state highways, increasing Highway Fund resources by an estimated $75 million annually starting in FY 2025-26, while decreasing General Fund earnings by the same amount. The change depends on SPIF performance and is implemented through a straightforward annual transfer by the State Treasurer.

Bill