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Senate committee advances bill letting Knoxville County impose up to 2% short-term rental tax to fund parks and tourism
Summary
House Bill 1837, a local-and-private bill authorizing Knoxville County to levy up to a 2% short-term rental tax for parks, tourism and recreation, was reported out by the Senate Finance Committee after members and counsel clarified that the bill includes a referendum and discussed how it interacts with last year’s law treating short-term rentals like hotels (Section 27-65-23.1).
The Senate Finance Committee voted to report out House Bill 1837, a local-and-private measure that would allow Knoxville County to levy up to a 2% tax on short-term rentals to fund parks, tourism and recreation.
Senator Hickman, who introduced the bill, said the county is seeking a revenue source to maintain parks and recreational facilities and that the measure includes a referendum: "They're just looking for some funds to be able to upkeep the parks in our recreational places." He framed the proposal as a local option to support youth programming and open parks that are currently closed for lack of funds.
Senator Sparks and others pressed on whether the proposal would duplicate recent statewide action. Senator Sparks asked if the committee addressed Airbnb taxation statewide last year and expressed concern about adding another tax after statewide tax policy changes. Senator Blunt noted recent legislation (transcript references Section 27-65-23.1) that placed certain short-term rentals under the hotel/motel tax definition. Counsel read the code language referenced by Senator Blunt, describing a default definition for hotel/motel under local-and-private laws and noting the statute’s focus on transient guests without a maximum number of nights.
Senator Fillegain asked whether the bill defines the number of days that qualify as a short-term rental; the committee noted the bill uses the phrase "transient guest" and does not set a specific day count in the text. Hickman said he would clarify drafting if necessary. Senators and counsel also discussed whether Knoxville County currently has a hotel/motel tax; the transcript records committee clarification that Knoxville does not have an existing hotel/motel tax and that the bill, as drafted, would create a local option subject to a referendum.
The committee made a motion that the title was sufficient and to do pass; members recorded "aye" and the chair said the bill would be reported out. No final floor-level enactment occurred in committee; the action sends the bill to the next legislative step with committee recommendations and noted clarifications on definition and referendum requirements.
