City hears overview of new state Infrastructure Development District laws and their mechanics

City of Gallatin officials on Sept. 23 heard from legal counsel about two new Tennessee statutes that allow developers to form Infrastructure Development Districts (IDDs) to fund public infrastructure through a special assessment on property within a district rather than general city taxation.

Attorney Jim Murphy of the Bradley Law Firm told the Gallatin Council Committee the 2024 statute and a related 2025 statute create a “special assessment district” mechanism that permits issuance of bonds or notes to pay for infrastructure and then levies an annual assessment on properties in the district to service that debt. “It basically is a special assessment that is assessed on all the property within the district, and then that money is used to pay for the public infrastructure,” Murphy said.

Murphy said the 2024 act required a district to be at least five acres, have at least $5 million in planned capital costs and ensure at least half the district area is residential. The petition establishing a district must be signed by the developer and the owners of all parcels inside the proposed boundaries and must include a name (containing “Infrastructure Development District”), the host municipality, parcel list, a site development plan and an estimated infrastructure cost and…