Tennessee's patchwork of development fees, adequate facilities taxes, and special assessments varies dramatically by county and municipality. This guide cuts through the complexity so residential builders can budget confidently and build smarter.
Tennessee has no single statewide impact fee statute. Instead, the authority to charge developers for growth-related infrastructure is fragmented across public acts, private acts, and municipal charter provisions — creating a patchwork that varies dramatically from one county to the next.
The 2006 County Powers Relief Act restructured the landscape significantly, prohibiting new impact fees by county while creating a framework for "adequate facilities taxes." Cities retained broader authority. Understanding which rules apply to your project's location is the first — and most consequential — step in any pro forma.
Tennessee courts draw a sharp line between a fee (a regulatory tool with costs tied to actual impact) and a tax (revenue-raising privilege levy). This distinction determines the level of judicial scrutiny your project might face — and affects whether a locality can charge you at all.
Impact Fees Adequate Facilities TaxesNo county or municipality can simply decide to charge developers. Authority must derive from a public act, a private act passed by the General Assembly, or a municipal charter. The 2006 County Powers Relief Act is now the exclusive authority for counties to levy adequate facilities taxes on development.
T.C.A. § 67-4-2901Courts have consistently required a rational nexus between a fee and the public burden created by a specific development. In Home Builders Assn. v. Williamson County (2002), excessive school fees without adequate justification were struck down. This proportionality requirement protects builders — but requires careful documentation.
Nexus RequirementThe Residential Infrastructure Development Act of 2024 created independent special districts as an alternative financing mechanism. The Real Estate Infrastructure Development Act of 2025 added infrastructure development districts covering roads, utilities, parking, and stormwater. These tools can benefit developers willing to co-invest in infrastructure.
T.C.A. § 7-84-701 et seq.Each mechanism operates under different legal authority, carries different obligations, and appears on your permit at different times. Knowing which applies to your site — and how they stack — is essential to accurate budgeting.
A charge imposed on new development to fund specific capital improvements made necessary by that development. Tied directly to growth-related infrastructure like roads, schools, parks, and public safety facilities.
A privilege tax levied on the act of constructing or developing property. Unlike impact fees, adequate facilities taxes don't require the same regulatory nexus — they're taxes on the privilege of development.
Charges levied against specific parcels to recover costs of improvements that directly benefit those properties. Also includes newer infrastructure district mechanisms from 2024–2025 legislation.
This overview reflects known fee structures as of early 2025. Fees change — always verify current schedules directly with the applicable building department before finalizing your pro forma.
| County / Municipality | Region | Fee Type | Estimated Fee / Unit | Scope | Authority |
|---|---|---|---|---|---|
| Williamson County Brentwood · Franklin · Fairview · Nolensville | Middle TN | AFT + Impact | Varies by use | Schools, Roads, Parks | Private Acts + Charter |
| Rutherford County Murfreesboro · Smyrna · La Vergne | Middle TN | AFT + Impact | $1,500 AFT + up to $10,952 (Mboro) | Schools; Roads/Parks/Safety (city) | Private Act + Charter |
| Murfreesboro (City) Rutherford County | Middle TN | Impact Fee | $2.50/sq ft (max $10,952) | Roads, Parks, Safety, Schools | City Ordinance (2023) |
| Montgomery County Clarksville | Middle TN | AFT | Contact county | School Facilities | Private Act |
| Maury County Columbia · Spring Hill | Middle TN | AFT + Impact | Varies; Spring Hill by private act | Infrastructure, Schools | Private Acts (1991/1994) |
| Sumner County Gallatin · Hendersonville · White House | Middle TN | AFT + Impact | White House: charter fee | Schools, General Infrastructure | Private Act + Charter |
| Wilson County Lebanon · Mt. Juliet | Middle TN | AFT | Mt. Juliet: public act | Schools, Public Facilities | Private/Public Acts |
| Robertson County Springfield · Greenbrier | Middle TN | AFT | Contact county | School Facilities | Private Act (1996) |
| Cheatham County Ashland City · Kingston Springs · Pegram | Middle TN | AFT + Impact | Varies by municipality | Infrastructure | Private Acts (1997) |
| Knox County Knoxville | East TN | Limited | Building permit fees only | Permit Processing | Home Rule Charter |
| Shelby County Memphis · Germantown · Collierville | West TN | Limited | Standard permit fees | Permit Processing | Home Rule Charter |
| Sevier County Gatlinburg · Pigeon Forge | East TN | Impact Fee | Gatlinburg: per private act | General Infrastructure | Private Act (1989) |
Development fees in Tennessee don't follow a single timeline. Some are assessed at permitting; others at plat approval or certificate of occupancy. Understanding when each charge hits your cash flow is critical to project financing.
Tennessee's development fee landscape is defined by a small set of foundational laws. These determine who can charge, how much, for what purpose, and with what limits. Every fee you pay traces back to one of these authorities.
When fees seem excessive, the proportionality requirement is your primary legal lever. Courts have ruled that fees must demonstrate a direct connection between the charge and the burden your specific project creates on public services.
The exclusive authority for counties to levy adequate facilities taxes post-June 2006. Bars new county impact fees or local real estate transfer taxes going forward. Qualifies "growth counties" based on population thresholds.
Qualifying growth counties may levy a school facilities tax on development. Counties with pre-existing development taxes under private acts cannot simultaneously levy the school facilities tax.
Cities incorporated under the general law Mayor-Aldermanic charter retain authority to levy impact fees regardless of the 2006 Act. La Vergne and White House have exercised this right; many others have not.
Creates a new mechanism: independent special districts that finance infrastructure through special assessments. Counties can borrow for infrastructure or reimburse developers for prior investment.
Establishes infrastructure development districts covering roads, utilities, parking, and stormwater facilities. Expands options for alternative development financing.
Sellers of new construction must disclose applicable impact fees and adequate facilities taxes to buyers. Failure to disclose can expose developers to liability.
Tennessee localities use several approaches to calculate development fees. Understanding the methodology helps you anticipate costs, identify errors in assessments, and model accurate pro formas.
2,500 sq ft home × $2.50/sq ft = $6,250 fee
Cap applies at $10,952/unit regardless of home size
County AFT ($1,500) + City Impact Fee (up to $10,952) = up to $12,452/unit for projects in Murfreesboro within Rutherford County
Murfreesboro's rate climbed from $1.50 → $2.00 → $2.50 per sq ft over FY2023–2025. Model future phases using anticipated, not current, rates.
Affordable housing units · Infill / redevelopment · Economic benefit projects · Developer-built public infrastructure offsets in some jurisdictions
A project in Murfreesboro pays both Rutherford County's AFT ($1,500/unit for schools) and the city's impact fee (up to $10,952/unit). Always check both jurisdictions, not just one.
Murfreesboro's fee structure was set to escalate on a published schedule. If you pull permits after a rate increase date, you pay the higher rate — even if your project was underwritten at the prior rate.
Counties like Maury and Rutherford have been actively lobbying for expanded fee authority. Legislative changes could create new fee obligations — or new opportunities — in counties not currently charging. Monitor the General Assembly session.
T.C.A. § 66-5-211 requires disclosure of applicable impact fees and AFTs to purchasers of new residential construction. Non-disclosure can create legal liability for the developer and builder.
These are the authoritative sources Tennessee developers should bookmark. When fees are in dispute or a project is being underwritten, these documents carry legal weight.
The definitive UT County Technical Assistance Service overview of all three fee mechanisms, statutory authority, and case law. Updated to include the 2024 and 2025 acts.
The Municipal Technical Advisory Service guide on city-level authority, particularly for Mayor-Aldermanic and Modified City Manager-Council charter cities.
TACIR's comprehensive table listing every county authorized to levy development taxes, the enabling legislation, and year of authorization. The starting point for any jurisdictional analysis.
The city's official current fee schedule, updated annually. The most detailed publicly available example of a structured residential development impact fee in Tennessee.
The full text of the County Powers Relief Act of 2006, the exclusive authority governing how counties may levy adequate facilities taxes on development.
TACIR's historical analysis of how Tennessee's development fee framework evolved through legislative action, with a full timeline of county-by-county authorizations.
Don't let a misunderstood fee schedule derail a project that pencils. Use this guide as your starting point — then go straight to the source before you close on land.
Explore Fee Structures by County →