This does not relate to the command being executed at high frequency, the TP command is ran once and once only.

Reproduction:
Summon this entity block in a command block using this command:

/summon AreaEffectCloud ~ ~1.125 ~ {Radius:0.5f,Duration:2147483647,Effects:[],Particle:"take",Tags:["Block","BlockController"],Passengers:[{id:"Shulker",Invulnerable:1,NoAI:1,Tags:["Block"]},{id:"FallingSand",Block:"minecraft:stone",Time:1,Tags:["Block"]}]}

Now run this ONCE:

/tp @e[tag=BlockController] ~ ~1 ~

Nothing happens?
The teleport will only update after quitting and rejoining

Code analysis by marcono1234 can be found in this comment.