State Survey of P3 Authorizing Statutes: Tennessee

Tenn. Code Ann. §§ 54-3-101 to 113

Summary

The law authorizes tolling as an additional and alternative method for funding or financing transportation facilities, and it authorizes the DOT to enter into agreements with private parties to develop or operate a tollway, toll facility, or any part thereof. Limits authorization for tolling initially to a pilot program of two projects.

No surety bond language.

Tenn. Code Ann. §§ 54-23-101 to 121

Summary

The law authorizes the State, counties, and municipalities to enter into P3s for mass transit system projects.

Surety Bond Requirements:

The law requires performance and payment bonds in compliance with the DOT’s bonding law or a letter of credit for the development or redevelopment of the project. The DOT determines the amount required. Bonds, letters of credit, or other forms of security are required for the operation of the facility, in the forms and amounts satisfactory to the responsible public entity.

Excerpt:

§ 54-23-110

“(a) Prior to developing, redeveloping, or operating the qualifying transportation facility, the eligible private entity shall enter into a comprehensive agreement with the responsible public entity. The comprehensive agreement shall provide for:

(1) Delivery of performance and payment bonds that comply with § 54-5-119(a) or letters of credit in connection with any development or redevelopment of the qualifying transportation facility, and bonds, letters of credit, or other forms of security for any operation of the qualifying transportation facility, in the forms and amounts satisfactory to the responsible public entity;”