(a) The governing body of a local government issuing revenue bonds pursuant to this part and part 1 of this chapter shall prescribe and collect reasonable rates, fees or charges for the services, facilities and commodities of the public works project or projects, and shall revise such rates, fees, or charges from time to time whenever necessary so that the public works project or projects shall be and always remain self-supporting. The rates, fees or charges prescribed shall be at least sufficient to produce revenue to:

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Terms Used In Tennessee Code 9-21-308

  • Bonds: means bonds or interim certificates issued pending preparation or delivery of definitive bonds of a local government issued pursuant to this chapter. See Tennessee Code 9-21-105
  • Discovery: Lawyers' examination, before trial, of facts and documents in possession of the opponents to help the lawyers prepare for trial.
  • Enterprise: means any one (1) of or combination of two (2) or more public works projects, undertakings or projects which the local government is or may hereafter be authorized to construct and from which the local government has heretofore derived or may hereafter derive revenues, and such enterprise includes all improvements, betterments, extensions and replacements thereto, and all appurtenances, facilities, lands, rights in land, water rights, franchises and structures in connection therewith or incidental thereto. See Tennessee Code 9-21-105
  • Governing body: means the legislative body of any local government of this state or any other authority charged with the governing of the affairs of any local government in this state. See Tennessee Code 9-21-105
  • Law: means any act or statute, general, special or local, of this state, including, but not limited to, any local government charter. See Tennessee Code 9-21-105
  • Local government: means any county, municipality or metropolitan government in this state. See Tennessee Code 9-21-105
  • Municipality: means any incorporated city or any incorporated town of this state. See Tennessee Code 9-21-105
  • Notes: means notes or interim certificates issued pending preparation or delivery of definitive notes of a local government issued pursuant to this chapter. See Tennessee Code 9-21-105
  • Property: includes both personal and real property. See Tennessee Code 1-3-105
  • Public works project: includes any one (1) or any combination of the following: acquisitions of land for the purpose of providing or preserving open land. See Tennessee Code 9-21-105
  • Revenues: means all fees, rents, tolls, rates, rentals, interest earnings, or other charges received or receivable by the local government from any public works project or enterprise then existing or thereafter to be constructed, including any revenues derived or to be derived by a local government from a lease, agreement or contract with any other local government, local government instrumentality, the state, or a state or federal agency for the use of or in connection with a public works project or enterprise, or all other charges to be levied and collected in connection with and all other income and receipts of whatever kind or character derived by the local government from the operation of any public works project or enterprise or arising from any public works project or enterprise. See Tennessee Code 9-21-105
  • Statute: A law passed by a legislature.
(1) Provide for all expenses of operation and maintenance of the public works project or projects, including reasonable reserves therefor; and
(2) Pay when due all bonds and notes and interest thereon, for the payment of which such revenue is or shall have been pledged, charged or otherwise encumbered, including reasonable reserves therefor.
(b) If the governing body of the local government shall by resolution so request, the revenues produced from the rates, fees or charges prescribed may, after providing for payments referred to in subsection (a), be applied to payments to the local government in lieu of ad valorem taxes on the property of the public works project or projects not to exceed the amount of taxes payable on privately owned property of a similar nature.
(c) Rates, fees and charges shall be made for any service, facility, and commodity of any public works project to a local government or to any department or works thereof at the rate applicable to other customers taking service under similar conditions. Revenues derived from such service shall be treated as all other revenues.
(d) Any surplus thereafter remaining, after establishment of proper reserves, if any, may be applied to the acquisition, extension, and/or improvement of the public works project or projects or may be applied to the reduction of rates in the case of a public works project that provides water, sewer, gas, or electric services.
(e) Notwithstanding any other law to the contrary, as a matter of public policy, public works projects financed under this chapter shall be operated on sound business principles as self-sufficient entities. User charges, rates and fees shall reflect the actual cost of providing the services rendered. Public works shall not operate for gain or profit or as a source of revenue to a government entity, but shall operate for the use and benefit of the customers served by such public works and for the improvement of the health and safety of the inhabitants of the area served. Nothing herein shall preclude a municipal utility system from operating water and sewer systems as individual or combined entities. Nothing herein shall preclude a municipal utility system from operating a public works system as a special revenue fund when the governing body of the municipality determines that it is in the best interest of the customers of the public works system and the citizens of the municipality. All water systems and wastewater facilities must utilize an enterprise fund for accounting and reporting its operations. Any water system or wastewater facility currently not operating as an enterprise fund must be doing so by July 1, 2016. To the extent of any conflict between this section and the Wastewater Facilities Act of 1987, compiled in title 68, chapter 221, part 10, the latter statute shall control.
(f) To the extent of any conflict between this section and § 7-39-404, § 7-34-115, or title 7, chapter 52, part 3, the latter statutes shall control.
(g) If a municipality violates this section, it must repay any funds illegally transferred. If the municipality does not have sufficient funds to repay any funds illegally transferred, the municipality is required to submit a plan covering a period not to exceed five (5) years in which to repay the funds. The plan shall be submitted to and approved by the comptroller of the treasury or the comptroller’s designee. Upon discovery of such violation through an audit, any city official in violation of this section is subject to ouster under title 8, chapter 47.
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