(The Center Square) – Tax deals for the NFL's Tennessee Titans and minor league baseball's Tennessee Smokies were signed into law this week by Gov. Bill Lee.
The governor also signed two bills that are key cogs in his criminal justice reform initiative. They aim to reduce recidivism and keep lower level offenders related to substance abuse and mental health out of jail and in community-based alternative programs.
The Titans deal is estimated to have a $10 million annual sales tax impact on the state. It will allow the team to retain sales tax revenue from all events at Nissan Stadium and keep half of the tax revenue from a planned mixed-use development around the stadium to use toward future stadium upgrades.
House Bill 1437 allows nearly $2 million in state sales tax revenue from sales at Nissan Stadium to go back to the Titans for stadium improvements until the stadium’s bonds are paid off. The amount going back to the Titans will increase in 2029 to $5.4 million annually from a special state account to the Metro Nashville Sports Authority.
The bill said plans for the 130 acres around the stadium could “include hotels, retail establishments, eating and drinking places, and other similar establishments.” Once those are in place, the annual sales tax amount given back to the team is estimated to be $10 million.
The Smokies deal will allow sales tax revenue from a new $65 million stadium for Chicago Cubs affiliate Tennessee Smokies in Knoxville, along with an estimated $142 million mixed-use development surrounding the stadium, to be used to pay off debt related to building the stadium.
The bill promises more than $100 million in private funds will be spent for a mixed-use development that includes 630,000 square feet of residential space and restaurants surrounding the stadium, which is scheduled to open July 1, 2023.
The complex is expected to bring 3,000 jobs to the area with an anticipated $1 billion economic impact over the next 30 years.
Criminal justice reform
HB 784 will setup a system with mandatory supervision for each parolee released in hopes of reducing recidivism. Lee and lawmakers have said while 95% of Tennesseans in prison eventually will be released, 50% of them will return to prison. The goal of the program is to significantly improve that rate of recidivism.
HB 784’s fiscal note estimated it will cost the state $20 million a year to fund the program but also save $1.6 million in the first year and $74 million annually over the next 10 years by housing fewer prisoners.
HB 785 redefines “violent offender” to allow for more offenders to be eligible for drug court. The exceptions are those who used a firearm in their crime, were convicted of domestic assault or caused death or great bodily harm.
HB 785 is estimated to save the state $9 million annually while keeping people out of jail or prison and utilizing community-based alternative programs.