Tennessee 2025-2026 Regular Session

Tennessee House Bill HB1338 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1
2	2	SENATE BILL 191
3	3	By Taylor
4	4
5	5	HOUSE BILL 1338
6	6	By Lamberth
7	7
8	8
9	9	HB1338
10	10	000710
11	11	- 1 -
12	12
13	13	AN ACT to amend Tennessee Code Annotated, Section 9-
14	14	21-133 and Title 9, Chapter 21, Part 4, relative to
15	15	local government debt.
16	16
17	17	BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
18	18	SECTION 1. Tennessee Code Annotated, Section 9-21-133(a)(1)(B), is amended by
19	19	deleting subdivision (vii) and substituting the following:
20	20	(vii) Is evidenced by a loan with either this state or a department or agency of
21	21	the federal government; or
22	22	SECTION 2. Tennessee Code Annotated, Section 9-21-133(a)(3), is amended by
23	23	deleting the subdivision and substituting the following:
24	24	(3) "Local government" means any incorporated city or town; metropolitan
25	25	government; county; water, wastewater, or energy authority; or utility district; and
26	26	SECTION 3. Tennessee Code Annotated, Section 9-21-133(b), is amended by deleting
27	27	the subsection and substituting the following:
28	28	(b) For purposes of this section, principal of debt must be treated as being
29	29	payable or amortized upon its stated maturity or upon any mandatory redemption date.
30	30	SECTION 4. Tennessee Code Annotated, Title 9, Chapter 21, Part 4 ,is amended by
31	31	adding the following new section:
32	32	9-21-409.
33	33	(a) As used in this section:
34	34	(1) "Heightened risk debt" means any debt obligation containing:
35	35	(A) A variable interest rate or rates;
36	36
37	37
38	38	- 2 - 000710
39	39
40	40	(B) An interest rate reset provision, where the interest rate can be
41	41	changed at certain intervals during the life of the debt; or
42	42	(C) A put option, where the holder of the debt has the ability to
43	43	force repayment before the final maturity date of the debt; and
44	44	(2) "Local government" means any incorporated city or town;
45	45	metropolitan government; county; water, wastewater, or energy authority; or
46	46	utility district.
47	47	(b) Prior to issuing any heightened risk debt, a local government shall submit a
48	48	request to the comptroller of the treasury or the comptroller's designee for approval. The
49	49	comptroller or the comptroller's designee may request any additional information as may
50	50	be required to properly review the request. The comptroller or the comptroller's
51	51	designee shall evaluate each request based on the local government's particular
52	52	circumstances and shall approve the request only if a determination is made that the
53	53	debt terms are in the public's interest.
54	54	(c) The comptroller of the treasury or the comptroller's designee shall report the
55	55	comptroller's approval or disapproval of the request to the governing body of the local
56	56	government within fifteen (15) business days after receipt of the request and all
57	57	requested supplemental documentation. After receiving the approval of the comptroller
58	58	or the comptroller's designee of the request or after the expiration of fifteen (15)
59	59	business days from the date the request and all supplemental documentation are
60	60	received by the comptroller or the comptroller's designee and no disapproval having
61	61	been reported by the comptroller or the comptroller's designee, whichever date is earlier,
62	62	the local government may take such action with reference to the proposed request as it
63	63	deems advisable in accordance with this section.
64	64
65	65
66	66	- 3 - 000710
67	67
68	68	(d) This section does not apply to loans or interim certificates with or purchased
69	69	by either this state or a department or agency of the federal government.
70	70	SECTION 5. This act takes effect July 1, 2025, the public welfare requiring it.