2023 Tennessee Code › Title 7 - CONSOLIDATED GOVERNMENTS AND LOCAL GOVERNMENTAL FUNCTIONS AND ENTITIES (§§ 7-1-101 — 7-91-104) › LOCAL GOVERNMENT FUNCTIONS (§§ 7-51-201 — 7-69-116) › Chapter 54 - ENERGY PRODUCTION FACILITIES (§§ 7-54-101 — 7-54-114) › Section 7-54-103 - Powers of municipalities - Delegation of municipal authority

(a)
The municipality shall charge for the production of any energy for such heating, cooling or processing and may combine it with any other energy produced. In no case shall the rates charged to electric or other power utility subscribers not receiving energy from the energy production facility be increased to provide revenue for the repayment of its bonds issued for such purposes.
(b)
(1)
For the purposes of this chapter, any municipality may issue bonds for the construction of energy production facilities in the manner and subject to §
7-54-106
, the Local Government Public Obligations Act of 1986, compiled in title 9, chapter 21, or in accordance with any other law applicable to the issuer of such bonds for such purposes; provided, that, notwithstanding any contrary provisions of any such laws, bonds issued as authorized in this subsection (b) for energy production facilities may be sold at public sale or at private sale without advertisement as the issuer of such bonds shall determine.
(2)
If such bonds or refunding bonds are issued by a not-for-profit corporation acting for the benefit of or on behalf of any one (1) or more counties, cities, towns, or local governments under this chapter, such bonds shall be sold at competitive bid or at a negotiated sale pursuant to this section. Prior to the adoption of any resolution of the board of the not-for-profit corporation authorizing the sale of bonds, notes, or other obligations or entering into any contract or other arrangement in the planning or preparation for the sale of bonds, notes, or other obligations, any such resolution or any such proposed contracts or other arrangements shall be subject to the approval of the comptroller of the treasury or the comptroller's designee and shall be subject to review by the state funding board. Any resolution of the not-for-profit corporation authorizing the sale of bonds, notes, or other obligations shall only become effective upon receiving the approval of the comptroller of the treasury or the comptroller's designee and the legislative bodies of the city and the county in which such city is located for whom or on whose behalf such not-for-profit corporation is acting. This subdivision (b)(2) shall not apply to any county with a metropolitan form of government and having a population of four hundred thousand (400,000) or more, according to the 1980 federal census or any subsequent federal census.
(c)
With respect to the construction, financing, operation, or maintenance of an energy production facility or any contract authorized by §
7-54-105(a)(3)
, a municipality has the power to enter into such contracts or agreements, as it shall determine to be necessary or beneficial, with any person, relating to the collection, delivery, sale, purchase, or disposal of solid waste and the output from an energy production facility, including, without limitation, output in the form of electricity, steam, fuel, residue, or otherwise. Notwithstanding any other law, any municipality or county has the power to enter into contracts or agreements with municipalities proceeding under this chapter providing for the collection, delivery, sale, purchase, or disposal of solid waste or the output from an energy production facility.
(d)
In connection with the construction, financing, operation or maintenance of an energy production facility or any contract authorized by §
7-54-105(a)(3)
, a municipality other than a power district is authorized to exercise exclusive jurisdiction and exclusive right to control the collection and disposal of solid waste within its boundaries. In furtherance of this subsection (d) and the energy and environmental objectives of this chapter, and title 68, chapter 211, any municipality, other than a power district, constructing, financing, operating or maintaining an energy production facility or entering into any contract authorized by §
7-54-105(a)(3)
, or contracting with another municipality for the disposal of solid waste in whole or in part through, or by means of, such an energy production facility, is authorized to exercise exclusive jurisdiction and exclusive right to control the collection and disposal of solid waste within its boundaries and to take all necessary action to displace competition with regulation or a monopoly public service; provided, that no county shall be authorized to exercise such jurisdiction and right within the corporate limits of any incorporated city or town or metropolitan government; and provided, further, that manufacturing firms that hold state permits to dispose of or utilize their own solid wastes on plant property on April 27, 1981, shall not be subject to this chapter except by mutual agreement between plant management and the municipality. Such jurisdiction and right to control by a municipality may be exercised by ordinance, resolution, contract or otherwise.
(e)
A municipality is authorized to establish, levy, and collect fees, rates, or charges in connection with:
(1)
The collection, delivery, sale, purchase, or disposal, whether at the site of an energy production facility, a landfill, or otherwise, of solid waste; and
(2)
The output from an energy production facility.
(f)
A municipality may pledge as security for the payment of the bonds authorized to be issued pursuant to this chapter, any revenues derived from or in connection with the construction, ownership, operation, financing, leasing or sale of any energy production facility, or the execution of any contract authorized by §
7-54-105(a)(3)
, including, without limitation, revenues derived from or in connection with any fees, rates, charges, contracts, or agreements in connection with the collection, delivery, sale, purchase, or disposal, whether at the site of an energy production facility, a landfill, or otherwise, of solid waste and the output from an energy production facility and may also pledge the revenues from the sale of energy to pay bonds or loans issued under any municipal or other bond authority or any other state legislation permitting energy production facilities.
(g)
Notwithstanding the limitations contained in any general statutory provisions granting municipalities the right of eminent domain or condemnation, for the purposes of this chapter, any municipality proceeding with the construction, operation, maintenance or management of an energy production facility, or executing any contract authorized by §
7-54-105(a)(3)
is authorized and empowered, within its boundaries, to condemn any land, easement or rights-of-way, either on, under or above the ground, for any and all purposes necessary in connection with the construction, operation and maintenance of an energy production facility or improvement to such facility. Title to property so condemned shall be taken in the name of the municipality and may be thereafter conveyed to any not-for-profit corporation acting for or on behalf of such municipality. For purposes of this subsection (g), no county shall be authorized to exercise such right of eminent domain or condemnation within the corporate limits of any town, city or metropolitan government.
(h)
The term of any contract or agreement authorized by this chapter may extend beyond the elected term of the members of the governing body of the municipality or county involved, but in no event may such term exceed forty (40) years.
(i)
The construction, operation, jurisdiction, control, and management of any facility constructed as authorized in this section may be delegated by the municipality to any of its agencies, divisions, boards, or departments as it shall determine, and such agencies, divisions, boards, or departments are authorized, notwithstanding any of the provisions of the municipality's charter, to accept such delegation of jurisdiction, control, and management. Such functions may also be delegated by the municipality to any not-for-profit corporation acting for or on behalf of such municipality; provided, that, except in any county with a metropolitan form of government and having a population of four hundred thousand (400,000) or more, according to the 1980 federal census or any subsequent federal census, the site selection for an energy production facility may be delegated to any such not-for-profit corporation, but shall be subject to the approval by a two-thirds (2/3) vote of the legislative bodies of the city and the county in which such city is located for whom or on whose behalf such not-for-profit corporation is acting prior to the purchase of any such site.
(j)
Any municipality or county exercising, whether jointly or severally, any authority conferred upon it by this chapter, as amended, is hereby declared to be acting in furtherance of a public or governmental purpose.
(k)
Provided, that such separation and disposition neither creates a public nuisance nor is otherwise injurious to the public health, welfare, and safety, nothing in this chapter shall prevent a person or business entity that generates or produces solid waste upon property owned, leased, or rented by such person or business entity to separate or cause to be separated recyclable materials from the solid waste while the solid waste is on such property and either to:
(1)
Maintain title to such recyclable materials for such person's or business entity's own use; or
(2)
Dispose of such recyclable materials by sale or gift.
(l)
Nothing in this chapter shall prevent a person from purchasing or receiving by gift recyclable materials for processing or other use separated and disposed of in strict accordance with subsection (k).
(m)
(1)
If such functions are delegated by the municipality to any not-for-profit corporation acting for or on behalf of such municipality, such corporation shall develop a uniform accounting system conforming to generally accepted accounting principles, which system shall be subject to approval by the comptroller of the treasury.
(2)
The annual report, including financial statements, and all books of account and financial records of such not-for-profit corporation shall be subject to audit by the comptroller of the treasury. The board of such corporation may, with the prior approval of the comptroller of the treasury, engage licensed independent public accountants to perform the audits. The audit contract between the corporation and the independent public accountant shall be on contract forms prescribed by the comptroller of the treasury. The corporation shall be responsible for reimbursement of the costs of audits prepared by the comptroller of the treasury and the payment of fees for audits prepared by licensed independent public accountants. Audits and working papers prepared by independent public accountants shall be subject to review and approval by the comptroller of the treasury prior to payment. Copies of such audits shall be provided to each member of the board, the legislative bodies of the city and the county in which such city is located for whom or on whose behalf such not-for-profit corporation is acting, and the comptroller of the treasury, and shall be made available to the press.
(3)
The board of directors of the not-for-profit corporation shall develop purchasing, contracting, and personnel procedures, which shall be subject to approval by the comptroller of the treasury and the commissioner of finance and administration prior to implementation.
(4)
This subsection (m) shall not apply to any county with a metropolitan form of government and having a population of four hundred thousand (400,000) or more, according to the 1980 federal census or any subsequent federal census.
Acts 1975, ch. 204, § 3; T.C.A., § 6-1333; Acts 1981, ch. 204, §§ 3-5; 1982, ch. 624, §§ 4, 5; 1983, ch. 226, §§ 2, 6, 8; 1987, ch. 82, §§ 1-3; 1987, ch. 250, §§ 3-6; 1988, ch. 750, §§ 32, 33; 1988, ch. 908, §§ 1, 5, 7, 8; 2010, ch. 868, § 21.