(The Center Square) – An inventory of Tennessee’s infrastructure over a five-year period shows an $82.7 billion need, with most of that coming from the transportation and utilities sector.
The report presented to the Tennessee Advisory Commission on Intergovernmental Relations on Friday shows a $3.6 billion increase in transportation projects from July 2024 to June 2029. The Public Infrastructure Needs Inventory is used by policymakers to establish long-range goals and to consider funding options.
Transportation projects are besieged by rising costs and flat user-fee revenues used to fund them. Since 2019, inflation has led to a 100% increase in lead pipe costs and an 80% increase in guardrail costs, Natalie Krzysztof, deputy commissioner for the Tennessee Department of Transportation, told a House Finance, Ways and Means Committee on Monday.
Gas, diesel, special petroleum, and vehicle registration fees have not increased during that same period. The General Assembly shifted tire tax revenues to the Department of Transportation in 2025, which adds $80 million to state transportation funds. Without that money, user fees would be down 1% instead of up 6%, according to the department.
“Due to inflation, we’re spending more money and we are really delivering less on our program,” Krzysztof told the committee.
Gov. Bill Lee included a one-time investment of $425 million for transportation projects in his fiscal year 2027 budget, following a $1 billion investment in fiscal year 2026.
Reid told the House Finance Ways the investment would be split three ways, with $75 million allocated to maintenance, $150 million for critical bridges and $200 million for highways.
“Really what this would do is this allows us to add the next rated, next highest impact projects in the 10-year plan,” Reid said.
Tennessee is receiving “tremendous attention” from private investors who want to put money into transportation, according to Reid. The Transportation Modernization Act allows the state to partner with the private sector on transportation projects. Reid hinted at a deal currently in the works.
“We’ve got a very exciting date coming up in the fall of this year,” Reid said. “We feel like we have a good opportunity to build a $4 billion piece of infrastructure along I-24 that will hopefully be able to pay for itself.”
The Tennessee Advisory Commission on Intergovernmental Relations said a study on transportation funding will be ready in September.
