Amends TCA Title 5; Title 6; Title 7 and Title 67, Chapter 6.

Present law establishes the allocation of state sales tax revenue, which, generally, is allocated to the general fund; for educational purposes; and to local governments. Present law contains certain exceptions and special allocations. This bill creates an additional special allocation of certain sales and use tax revenue to eligible counties and municipalities, as discussed below. Under this bill, an amount equal to the amount of state sales and use tax revenue derived from 1 percent of the state sales and use tax on all sales in an eligible county or municipality in which an eligible project is owned or operated will be apportioned and distributed to the county or municipality that has adopted a resolution or ordinance accepting the apportionment and that meets the other requirements of this bill, for the purpose of funding economic development and infrastructure projects. For the purposes of this bill, "eligible county" means: (1) Prior to December 31, 2021, a county that meets one or more of the following criteria as of December 31, 2020: (A) Has a per capita income of 80 percent or less of the national average; (B) Has an unemployment rate that is, for the most recent 24-month period for which data are available, at least 1 percent greater than the national average unemployment rate, or, for the most recent 12-month period for which data are available at least 2 percent greater than the state average unemployment rate; (C) Has experienced, or is about to experience, a special need arising from actual or threatened severe unemployment or economic adjustment problems resulting in severe short-term or long-term changes in economic conditions, as determined by the commissioner of finance and administration, the commissioner of economic and community development, and the commissioner of revenue; or (D) Has an area composed of property acquired from the state by an eligible county or an industrial development corporation established in the eligible county, and the property was used by the state as a correctional facility; or (2) On and after December 31, 2020, a distressed rural county that will be identified using a consistent methodology based on a set of broadly available measures of economic well-being (such as county unemployment rate, personal income per capita, etc.). Using this consistent methodology, the above-referenced commissioners will determine which counties are eligible counties and publish a list of eligible counties by July 1 of each year. In order to receive an apportionment under this bill, each participating local governmental body must adopt a resolution or ordinance, as applicable. This bill sets out in detail the process that must be followed prior to the adoption of such a resolution or ordinance, provisions regarding counties entering into interlocal agreements with municipalities located within the county, notice requirements, information that must be included in the resolution (including information regarding general obligation debt), and other requirements for the allocation under this bill. This bill also sets out in detail the procedure to be followed if a project becomes infeasible. Under this bill, 1 percent of the amount of sales and use tax revenue distributed must be paid into the general fund of the state treasury to defray administration costs, and the remaining proceeds of the revenue must be distributed to the legislative body of the eligible county. The bill explains in detail how counties must distribute funds. This bill specifies that in the event a municipality fails to comply with the requirements of this bill, the eligible county containing the special district is not liable for such noncompliance.