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SB 469

Taxes, Privilege - As introduced, increases from 2.4 to 5 percent, the amount of realty transfer tax and mortgage tax collections retained as commission by county registers for collecting and reporting those taxes; requires 50 percent of such collections to be deposited in the county general fund; allocates the remaining balance to the wetland acquisition fund, local parks land acquisition fund, state lands acquisition fund, agricultural resources conservation fund, and state general fund. - Amends TCA Section 67-4-409.

114th Regular Session (2025-2026) Introduced by Janice Bowling

The bill shifts recordation tax revenue to local control by increasing the county commission to 5% and directing 50% of total collections to the county general fund, reducing state

Assigned to General Subcommittee of Senate State and Local Government Committee
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Bill Summary · SB 469

Summary of SB 469 / HB 586 (Session 114) – Tennessee

Basic purpose

  • The bill amends Tennessee Code Annotated § 67-4-409 to change how recordation taxes (realty transfer tax and mortgage tax) are collected and allocated.
  • Core changes: increase the commission retained by county registers from 2.4% to 5% for collecting/reporting the taxes; require 50% of total collections to be deposited in the county general fund; allocate the remaining balance to specified state and local funds.

Key provisions and changes

  • Commission retained by county registers:

    • Current: 2.4% of the tax collections retained as commission.
    • Proposed (section amended): 5% retained as commission for collecting/reporting.

  • Allocation of tax revenues:

    • 50% of total recordation tax collections must be deposited into the county general fund (no designation for a specific purpose).
    • The remainder of the taxes collected is remitted to the state treasurer and deposited into funds enumerated in subsections (g), (i), (j), and (l) of § 67-4-409, subject to allocation in subsection (m) and to the state General Fund.
    • After the above allocations, remaining collections are distributed to the General Fund of the state as well, per the existing statutory framework.

  • Allocation details for the remaining (after county share) funds:

    • Wetland Acquisition Fund
    • Local Parks Land Acquisition Fund
    • State Lands Acquisition Fund
    • Agricultural Resources Conservation Fund
    • Any remaining after these allocations would go to the General Fund
    • Notably, the fiscal note indicates fixed dollar allocations to these funds are preserved, independent of the percentage allocation of remaining funds.

Who would be affected

  • Local governments: Counties receive a larger share of the recordation tax commissions (up from 2.4% to 5%); 50% of total collections would flow directly to county general funds for local use.
  • State government: The portion of collections above the 50% to the county general fund would continue to support state funds (Wetland Acquisition, Local Parks Land Acquisition, State Lands Acquisition, Agricultural Resources Conservation) and the state General Fund, as per current law, with the amendments altering the flow of funds.
  • Taxpayers and real estate transactions: Indirectly affected through potential changes in how tax revenues are allocated and how much is directed to local versus state uses.

Timing and procedural notes

  • Effective date: The act becomes law upon becoming effective, described as “the public welfare requiring it.”
  • Legislative history: Assigned to the Senate State and Local Government Committee; Sponsor: Senator Bowling; House companion HB 586 by Bricken; co-sponsor: Janice Bowling.
  • Fiscal note (highlights):
    • Estimated revenue impact:
    • State General Fund and Local Government Revenue: Approximately $196,098,000 for FY 2025-26 and subsequent years
    • Assumptions:
    • Current tax base: Realty transfer tax of $0.37 per $100 and mortgage tax of $0.115 per $100
    • Projected total recordation tax collections: rising from about $340.4 million (FY 2023-24) to about $372.8 million (FY 2025-26)
    • Under current law, counties retain 48% of the 5% commission and the state General Fund gets 52%.
    • Under the bill, counties would retain 100% of the 5% commission, plus the 50% county general fund allocation of total collections, increasing local receipts and decreasing state General Fund revenue correspondingly.

Net fiscal impact (as described in fiscal note)

  • State General Fund impact: Decrease of about $196 million in FY 2025-26 and ongoing.
  • Local government impact: Increase of about $196 million in FY 2025-26 and ongoing (via the 50% county general fund allocation and full 5% county commission retention).

Bottom line

SB 469 / HB 586 would significantly shift short-term fiscal flows by increasing county retention of recordation tax commissions to 5%, mandating 50% of total collections go to the county general fund, and allocating the remainder to specified local and state funds. The change would reduce state General Fund revenue and boost local county revenues beginning in FY 2025-26 and continuing thereafter, while preserving fixed allocations to certain state funds.

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

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