Subcommittee approves bill allowing qualified contractors to build utility infrastructure under utility oversight

House Bill 542, carried by Chairman Vaughn, was approved by the Business & Utilities Subcommittee after members added amendments clarifying inspection and warranty requirements for third‑party installations.

Chairman Vaughn said the bill is intended to allow qualified contractors to install utility infrastructure—electric, gas, wastewater and water—under the oversight of a third‑party engineer and subject to utility inspection and acceptance. Vaughn framed the measure as a way to increase transparency in project costs and to allow utility crews to focus on maintenance and outage response rather than capital builds.

The committee adopted two amendments during debate (drafting codes discussed on the floor) and several members pressed for protections: inspection and testing by the utility, bonding, and performance warranties of up to one year. Representative Barrett and others raised concerns about self‑inspection, potential conflicts where a single engineer serves both developer and inspector in rural areas, and a general fiscal note that the utilities association provided which signaled potential revenue and expenditure impacts.

Chairman Vaughn said the amendments were negotiated with the Tennessee Association of Utility Districts and other stakeholders and suggested the changes could reduce costs by allowing utilities to use supplemental contractors while retaining inspection authority.

The clerk reported seven ayes and two nays; the chairman declared House Bill 542 passed and sent to full Commerce.