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J enne&see Senate
PUBLIC CHAPTER NO. 18
SENATE BILL NO. 115
By Powers
Substituted for: House Bill No. 57
By Moon, Wright, Rudd, McCalmon, Slater, Eldridge, Stinnett, Renea Jones
AN ACT to amend Tennessee Code Annotated, Title 6, Chapter 56, Part 1, relative to audits of
municipalities.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 6-56-105(e), is amended by deleting the
subsection and substituting:
(e)(1) All such audits must be completed and submitted to the comptroller of the
treasury no later than six (6) months following the end of the municipality's fiscal year.
The preparer of the audit shall furnish one (1) copy of each audit to the mayor, chief
executive officer, each member of the governing body, and the comptroller of the
treasury. Copies of each audit must also be made available to the press.
(2) A municipality having two (2) or more outstanding late annual audits is
subject to the following penalty:
(A) Sales tax revenue collected and distributed by the state to the
municipality is reduced by an amount mutually agreed upon by the comptroller
of the treasury and the commissioner of revenue. The sales tax revenue
reduction must not exceed fifteen percent (15%) of the total amount due to the
municipality in a fiscal year, until the municipality is in compliance with this
section;
(B) The amounts reduced as a penalty pursuant to this section are
held in reserve by the department of revenue and allocated to the municipality
after the municipality complies with this section as determined by the
comptroller of the treasury; and
(C) The comptroller of the treasury may waive a penalty assessed in
accordance with this subsection ( e) in accordance with policies and
procedures established by the comptroller.
SECTION 2._ This act takes effect July 1, 2025, the public welfare requiring it. PASSED:
SENATE BILL NO. 115
February 27, 2025
RANDY McftALL Y
SPEAKER OF THE StlNA TE
CAMl'MOWSEXTON, SPEAKER
HOUSE OF REPRESENTATIVES
APPROVED this [;;,:t=L day of lY) c;.YC Q , 2025
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BILL LEE, GOVERNOR