Page 29 - Vol40 No3 Sept-Oct2022

from any private individual or entity methods whereby a municipality or Association (“NADA”) Used Car Guide
without public advertisement and county may purchase used or secondhand and the Kelley Blue Book are nationally
competitive soliciting as long as the items from a private individual or entity recognized authorities that are used to
purchasing government documents the without public advertisement and determine the fair market value of used
general range of value of the purchased competitive bidding. A municipality or vehicles. See Clement v. Clement, No.
item through a listing in a nationally county may document the value either W2003-02388-COA-R3-CV, 2004 WL
recognized publication or through an “through an appraisal by a licensed 3396472 at * 18-19 (Tenn. App. Dec. 30,
appraisal by a licensed appraiser, and appraiser” or by establishing “the 2004). Similarly, the Aircraft Bluebook
the price is not more than five percent general range of value of the purchased is a publication utilized in the aviation
(5%) higher than the highest value of item through a listing in a nationally industry to determine the fair market
the documented range. recognized publication.” Id. If either of value of aircraft, and the Green Guide is
TENNESSEE CODE ANNOTATED these tests are met, then the municipality a trade publication that supplies current
Copyright © 2022 by The State of Tennessee or county may purchase the item if the information as to equipment values. See
All rights reserved price of the item is not more than five CB Aviation, LLC v. Hawker Beechcraft
I ran this by the MTAS legal percent higher than the highest value of Corp., Civil Action No. 2:10-cv-1411-
department to be sure I was on solid the documented range. Id. JD, 2011 WL 5386359 at *5 (E.D. Pa.
ground. MTAS Attorney Elisha Hodge A municipality or county may Nov. 8, 2011); Rosebud Co. v. Dept.
provided me with a relevant Tennessee not comply with the requirement of of Revenue, 849 P.2d 177, 178 (Mont.
Attorney General’s Opinion: “document[ing] the general range of 1993). In contrast, a sale price listed by a
value of the purchased item through single individual or entity for a used or
STATE OF TENNESSEE OFFICE OF a listing in a nationally recognized secondhand item on a website may or may
THE ATTORNEY GENERAL publication” by establishing a “value” not reflect the actual fair market value
June 10, 2013 on the used or secondhand item based of the item. See Port Everglades Launch
Opinion No. 13-44 on advertised prices for similar used Service, Inc. v. M/Y SITUATIONS, No.
Purchase of Used or Secondhand and secondhand items listed for sale on 10-60571-CIV, 2011 WL 1196017 at
Items by Municipalities and Counties websites. The word “value” is not defined *5 (S.D. Fla. Mar. 29, 2011) (rejecting
QUESTION Is a municipality or by Tenn. Code Ann. § 12-3-1003(b). In testimony to establish fair market value
county authorized to purchase a used such cases courts will look to dictionary that relied upon listed prices as opposed
or secondhand item from a private definitions to determine the commonly to actual sales prices). Thus, a website
individual or entity without public accepted meaning of an undefined word that simply lists items for sale is not a
advertisement and competitive bidding used in a statute. Eastman Chemical “nationally recognized publication” that
following a valuation of the item Co. v. Johnson, 151 S.W.3d 503, 508 contains the current fair market value of
based on advertised prices for similar (Tenn. 2004); State v. Clark, 355 S.W.3d the item, as required by Tenn. Code Ann.
used and secondhand items listed 590, 592-93 (Tenn. Crim. App. 2011). § 12-3-1003(b). See, e.g., In re Hogue,
for sale on websites? OPINION No. “Value” is generally defined as “1: a fair 286 S.W.3d 890, 894 (Tenn. 2009) (stating
ANALYSIS Tennessee law authorizes return or equivalent in money, goods, or that, when a statute is unambiguous,
municipalities and counties to purchase services for something exchanged; 2: the courts will discern legislative intent from
used and secondhand items from monetary worth of a thing: MARKET the natural and ordinary meaning of the
private individuals and entities without PRICE.” Merriam–Webster’s Dictionary statutory language and will not adopt a
public advertisement and competitive 547 (New ed. 2005). Thus, giving the forced construction that would extend the
bidding when certain requirements word “value” its plain and ordinary statute’s meaning).
are met, stating specifically as follows: meaning, the General Assembly intended
Notwithstanding any charter, private it to mean fair market value. See, e.g., Working Together to Solve the Problem
act, or general law requirements, any Lee Medical, Inc. v. Beecher, 312 S.W.3d Once Eric and I had laid out the path
municipality or any county may purchase 515, 526 (Tenn. 2010); State v. Bobo, 727 for Collegedale to follow, we discussed the
used or secondhand articles consisting of S.W.2d 945, 952 (Tenn. 1987); Weaver v. issue and agreed that other Public Works
goods, equipment, materials, supplies, or Woods, 594 S.W.2d 693, 695 (Tenn. 1980) Departments across Tennessee might be
commodities from any private individual (stating that legislative intent is derived interested in this information. With the
or entity without public advertisement primarily from the natural, ordinary, equipment successfully now purchased
and competitive bidding as long as the and commonly accepted meaning of the (under budget) and now in Collegedale’s
purchasing government documents the words that the General Assembly has inventory, we wanted to share the story.
general range of value of the purchased chosen to use in the statute itself). The Final Points to Remember:
item through a listing in a nationally provisions of Tenn. Code Ann. § 12-3- • Work with your city attorney
recognized publication or through an 1003(b) expressly state that “fair market • Check your purchasing policies (they
appraisal by a licensed appraiser, and value” shall be determined by consulting may need to be amended)
the price is not more than five percent “nationally recognized publications” • Document, document, document!
(5%) higher than the highest value of the that publish current fair market values So, if you didn’t know about this before,
documented range. Tenn. Code Ann. § of the item that the municipality or here’s another option available to you in
12-3-1003(b). county wishes to purchase. For instance, dealing with that epidemic supply chain
As set forth above, there are two the National Automobile Dealers problem.

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