(a) The state may enter into agreements with municipalities, and any municipality may enter into an agreement with the state for loans herein provided, subject, however, to any existing contractual obligations of the municipality.

Terms Used In Tennessee Code 68-221-506

  • Authority: means the Tennessee local development authority, a public agency, created by title 4, chapter 31, or its successor. See Tennessee Code 68-221-502
  • Construction: means the erection, building, acquisition, alteration, reconstruction, improvement or extension of waterworks, preliminary planning to determine the economic and engineering feasibility of waterworks, the engineering, architectural, legal, fiscal and economic investigations and studies, surveys, designs, plans, working drawings, specifications, procedures and other action necessary in the construction of waterworks, and the inspection and supervision of the construction of waterworks. See Tennessee Code 68-221-502
  • Department: means the department of environment and conservation. See Tennessee Code 68-221-502
  • Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
  • Municipality: means any county, metropolitan government, incorporated town or city, or special district of this state empowered to provide water services, or any combination of two (2) or more of the foregoing acting jointly, in connection with an eligible project. See Tennessee Code 68-221-502
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • Waterworks: includes all or any part of the following: source of supply, pumping facilities, purification works, collection and storage facilities and distribution system for water, together with all necessary parts and appurtenances for proper operation. See Tennessee Code 68-221-502
(b) Any loan agreement may include such provisions as may be agreed upon by the parties thereto, and shall include, in substance, the following:

(1) An estimate of the reasonable cost of the project to be constructed, as determined by the department;
(2) An agreement by the state to pay part of the amount of the loan to the municipality prior to the construction, or during the progress of the construction, or to pay the amount of the loan following completion of the construction, as may be agreed upon by the parties; and
(3) An agreement by the municipality to:

(A) Proceed expeditiously with and complete the project in accordance with plans approved pursuant to this part and to § 68-221-102;
(B) Commence operation of the waterworks on its completion, and not discontinue operations or dispose of the project without the approval of the department and the authority;
(C) Operate and maintain the project in accordance with applicable provisions of this chapter, and rules and regulations of the department;
(D) Establish and collect such fees, rates or charges for water service and/or pledge other available sources of revenues necessary to make payments according to the schedule established by the authority and to make payments as provided in this part; and
(E) Establish and maintain adequate financial records for the waterworks, and make an annual audit of the financial records and transactions covering each fiscal year and furnish a copy of such audits to the comptroller of the treasury.
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