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Tennessee State Land Right-of-Way (3-TN-b)

Information current as of 2018
In Tennessee, a developer may need a State Land Right-of-Way (Right-of-Way) or a Land Lease from the state agency with jurisdiction over the land if the project requires access to state-owned property. Any Right-of-Way or Land Lease that the state enters needs to follow the policies and procedures of the State Building Commission (SBC). Tenn. Code Ann. §12-2-112(a)(4). The Tennessee Department of General Services – Division of Real Estate Asset Management (STREAM) provides assistance during the Right-of-Way or Land Lease negotiation process and ensures that state agencies comply with the SBC policies and procedures. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 46


State Land Right-of-Way Process

3-TN-b.1 to 3-TN-b.2 – Does the Developer Need a Right-of-Way or Land Lease?

The developer must determine whether the project requires a State Land Right-of-Way (Right-of-Way) or Land Lease. If the project does not require a Right-of-Way or Land Lease, the developer may continue with the project.


3-TN-b.3 – Determine State Agency with Jurisdiction Over Land

The developer must determine the appropriate state agency with jurisdiction over the state land. This information may be available in public records or on visible signs on or near the property.


3-TN-b.4 – Contact State Agency with Jurisdiction Over Land

The developer must contact the state agency with jurisdiction over the state land to determine the agency’s process for negotiating and granting the Right-of-Way and/or Land Lease.

3-TN-b.5 – Request Right-of-Way/Land Lease

The developer must request either a Right-of-Way or Land Lease to access State Land. Depending on the procedures of the state agency with jurisdiction over the land, the developer may need to submit an application with supporting documentation.

3-TN-b.6 – Review Right-of-Way/Land Lease Request for Approval

The agency with jurisdiction over the state land reviews the developer’s request for a Right-of-Way or Land Lease. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 46

3-TN-b.7 to 3-TN-b.8 – Will the Right-of-Way/Land Lease Benefit a Private Entity?

Unless otherwise approved by the State Building Commission (SBC), the Right-of-Way or Land Lease must include “fair market value” consideration. If the Right-of-Way or Land Lease benefits a “private person, persons or entity,” the state agency must advertise the availability of the property to the public and receive proposals from any interested party. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 44

The advertisement must appear “in a newspaper which is local with respect to the property” in question, and in a “newspaper in either Nashville, Memphis, Chattanooga, or Knoxville, whichever is nearest by air.” Tenn. Code Ann. §12-2-112(a)(3). “A minimum of two (2) weeks shall be allowed for responses to such advertisement.” By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 44

3-TN-b.9 – Does the Agency Approve the Right-of-Way/Land Lease Request?

The agency determines whether to approve the request for a Right-of-Way or Land Lease. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, pp. 44, 49

If the agency does not approve the Right-of-Way or Land Lease request, then the project cannot use or access the state land in question.

3-TN-b.10 – Negotiate Right-of-Way/Land Lease Terms

The agency with jurisdiction over the state land in question and the developer negotiate the terms of the Right-of-Way or Land Lease. STREAM may aid in negotiations.

3-TN-b.11– Notify the Department of General Services

Once the agency decides a need exists to grant or lease the proposed Right-of-Way or Land Lease, the agency notifies the Tennessee Department of General Services and requests that STREAM review the proposed Right-of-Way or Land Lease. The agency uses forms prepared by the STREAM. The notification/request includes information about the:

  • Nature of the proposed conveyance;
  • Interested parties; and
  • Justification of the department or agency for the Right-of-Way or Land Lease.

By-laws, Policy, and Procedure of the State Building Commission of Tennessee, pp. 44, 49

3-TN-b.12– Review Right-of-Way/Land Lease Terms for Recommendation of Approval

After receiving a notification and request from the state agency, STREAM reviews the agency’s request to approve the proposed Right-of-Way or Land Lease. STREAM determines whether any other state agency or institution needs the property in question. STREAM also determines whether granting the Right-of-Way or Land Lease will hamper future state operations and whether the consideration is at “fair market value.” Finally, STREAM determines whether the disposal is in the State’s best interest. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, pp. 44, 49

3-TN-b.13 – Does STREAM have Authority, and Choose to, Approve an Option Contract?

The Executive Sub-Committee is a group within the SBC that is composed of three State Constitutional Officers, the Commissioner of Finance and Administration, and staff selected by the SBC. The SBC may delegate authority to the Executive Sub-Committee on any manner, such as approving rights-of-way and land leases. The Executive Sub-Committee has authority to approve or deny any real estate disposition. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 11

STREAM may enter into an option to purchase property prior to Executive Sub-Committee approval if all of the following are satisfied:

  • The acquisition is deemed to be time sensitive by the requesting agency in writing

and concurred with by STREAM; and

  • The target property meets one of the following conditions:
    • Identified for future acquisition in a SBC approved Master Plan; or
    • Approved for acquisition by State Lands Acquisition Committee in accordance

with Tenn. Code Ann. §11-14 et seq.; or

    • Determined to be a priority wetland and bottomland hardwood forest acquisition in accordance with Tenn. Code Ann. §11-14 et seq.; or
    • Included as part of approved SBC project where land purchase is specified in the project scope; and
  • Funding is available for the option consideration, if any will be paid, and for the

acquisition. Tennessee Department of Finance and Administration must verify the availability of funds.

Any actions taken regarding options will be reported to the Executive Sub-Committee at the next scheduled meeting. Option consideration cannot be greater than 1% of the anticipated purchase price or exceed $10,000, except for transactions with an anticipated purchase price of less than $100,000.

The Commissioner of Finance and Administration and one other member of the Executive Sub-Committee may waive the above requirements and limits on the amount of option consideration. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 46

3-TN-b.14 – Does STREAM Recommend the Right-of-Way/Land Lease Terms for Approval?

If STREAM determines the disposal is in the state’s best interest, then it must recommend to the Executive Sub-Committee that it approve the disposal. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 11


3-TN-b.15 to 3-TN-b.16 – Review STREAM’s Recommendation for Approval of Right-of-Way/Land Lease

The Executive Sub-Committee reviews STREAM’s recommendation for approval of the Right-of-Way or Land Lease. The Executive Sub-Committee must ensure that granting the Right-of-Way or Land Lease is consistent with SBC policy. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, pp. 44, 49

The Executive Sub-committee reviews whether the proposed Right-of-Way or Land Lease will hamper future state operations and whether consideration is adequate. Qualified state employees “may assess the value of leases, easements, and rights-of-way” unless the the Executive Sub-Committee determines that the state should employ an independent appraiser, or that the state should use another method to determine consideration. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, pp. 44, 49

The Executive Sub-Committee has the authority to approve proposed Right-of-Way or Land Lease in accordance with [[Tennessee State Building Commission – By-laws, Policy, and Procedure of the State Building Commission of Tennessee |SBC Policy]].

If the Executive Sub-Committee does not approve the proposed Right-of-Way/Land Lease, the project cannot use or access the state land.

3-TN-b.17 – Is the Interest Conveyed a Land Lease?

If the interest conveyed by the state is a Right-of-Way, then the Right-of-Way does not require SBC approval.

If the interest conveyed by the state is a Land Lease, the Land Lease may require SBC approval. Tenn. Code Ann. §12-2-115(b)(1).

3-TN-b.18 to 3-TN-b.20 – Does the Land Lease Require State Building Commission Approval?

A proposed Land Lease requires approval by the full SBC either if the term of the Land Lease is greater than five (5) years or if the annual consideration amount is greater than $150,000. Tenn. Code Ann. §12-2-115(b)(1).

The full SBC assesses the proposed Land Lease for approval by determining whether the Land Lease is consistent with [[Tennessee State Building Commission – By-laws, Policy, and Procedure of the State Building Commission of Tennessee |SBC Policy]]. The members of the full SBC are the:

  • Governor (Chair);
  • Lieutenant Governor (Vice-Chair);
  • Speaker of the House;
  • Secretary of State (Secretary of SBC and Executive Sub-Committee);
  • Comptroller of the Treasury;
  • State Treasurer; and
  • Commissioner of Finance and Administration (Chairman of Executive Sub-Committee).

Tennessee State Building Commission Website.

If the SBC does not approve the proposed Land Lease, the project cannot use or access the state land. The developer may not be able to continue with the project.

3-TN-b.21 – Publish Land Lease Information

If the Land Lease does not require SBC approval, the State Architect publishes on the State Architect’s website, at minimum, the following information regarding each lease (subject to exceptions by the SBC):

  • Name or names of lessor or lessors and lessee or lessees;
  • Lease description and purpose;
  • Lease term;
  • Rental rate, stated as total rent for the lease term, annual rent, and as a rent per square foot (if applicable);
  • Source or sources of funding;
  • Procurement method used to obtain the lease; and
  • Any other information as directed by the SBC.

Tenn. Code Ann. §12-2-115(b)(2).

3-TN-b.22 – Notify Members of Legislature

The Commissioner of General Services must “notify the house of representatives and senate member or members from the district in which” the property that the agency seeks to place under a Right-of-Way or Land Lease is located at least 20 days before the parties execute the Right-of-Way or Land Lease. Tenn. Code Ann. §12-2-112(b).

3-TN-b.23 to 3-TN-b.24 – Submit Documentation of Process and Right-of-Way/Land Lease to State Attorney General

The state agency with jurisdiction must submit the appropriate agreements, including documentation to indicate that all laws, rules and regulations and other contract terms have been complied with, to the Attorney General for approval prior to final execution of the right-of-way or land lease. By-laws, Policy, and Procedure of the State Building Commission of Tennessee, p. 47

3-TN-b.25 – State Land Right-of-Way/Land Lease

The state agency with jurisdiction over the state land issues a Right-of-Way or enters a Land Lease with the developer. The developer must comply with the conditions of the state land Right-of-Way or Land Lease.


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Contact Information









Edit Tennessee Department of General Services – Division of Real Estate Asset Management
Assistant Director of Compliance 615-741-7865 steveabbazabbalusk@tnabbazabbagov Visit Website