Tennessee lawmakers recently modified certain tax laws related to nuclear facilities, including Orano USA’s multi-billion dollar uranium enrichment plant in Oak Ridge.
In Senate Bill 885/House Bill 1133, sponsored by state senator Shane Reeves (R) and state representative Clark Boyd (R), expanded the definition of “certified green energy production facility” to include nuclear energy facilities for sales and use tax credits. The bill was first introduced in February and amended in April.
The amendment removed a provision to tax uranium enrichment services. It was passed on April 21 and the bill was signed into law by Gov. Bill Lee (R) on May 21 and went into effect on July 1.
Because nuclear reactors use enriched uranium, the sponsors said the process of enriching uranium should be considered a service rather than a good. The lawmakers based this on research by the Fiscal Review Committee staff.
Passage of the law came months after Orano USA selected Oak Ridge as its site for a uranium enrichment facility in September 2024.
While the law is now in effect, some Tennessee localities were caught off guard by the recent discovery of the sales tax exemption for Orano USA’s multi-billion-dollar uranium enrichment facility in Oak Ridge, Tennessee Lookout reported July 23.
Randy Hemann, Oak Ridge City Manager, and Terry Frank, Anderson County Mayor, said they were not aware of tax breaks for the enriched uranium facility project until this summer, despite the tax exemption amendment being passed in April.
Hemann said Oak Ridge officials are not overly concerned about forgoing sales tax linked to the facilities, noting various nuclear projects are underway in the Tennessee region.
Hemann expects to make up any financial losses through future property taxes and economic growth.