Subsidies — Municipal Costs

  1. Law
  2. Tennessee Code
  3. Consolidated Governments and Local Governmental Functions and Entities
  4. Municipal Electric Plants
  5. Telecommunications Services
  6. Subsidies — Municipal Costs

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A municipality providing any of the services authorized by §7-52-401 shall not provide subsidies for such services. Notwithstanding that limitation, a municipality providing such services shall be authorized to:

  1. Dedicate a reasonable portion of the electric plant to the provision of such services, the costs of which shall be allocated to such services for regulatory purposes; and
  2. Lend funds, at a rate of interest not less than the highest rate then earned by the municipality on invested electric plant funds, to acquire, construct, and provide working capital for the system, plant, and equipment necessary to provide any of the services authorized under § 7-52-401; provided, that such interest costs shall be allocated to the cost of such services for regulatory purposes. Any loan of funds made pursuant to this section shall be approved in advance by the comptroller of the treasury or the comptroller's designee and shall contain such provisions as are required by the comptroller of the treasury or the comptroller's designee.


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