Tennessee Code Title 68. Health, Safety and Environmental Protection § 68-221-211

(a) Each municipality having entered into a contract with the state pursuant to this part shall remit to the authority such amounts and at such times as shown in the repayment schedule to be placed in a special trust fund created to provide for the payment of the principal of and interest on bonds and notes of the authority for the purpose of providing grants for sewage treatment works.

(b) The authority shall have the right to enter into such contracts and require such guarantees or security as it may see fit prior to, or simultaneously with, the issuance of bonds or notes as authorized hereunder or to refuse to issue such bonds or notes until such contracts or security, in any form which the authority may elect, are agreed to or are obtained.

(c) In the event any municipality having entered into a contract pursuant to this part shall fail to remit funds in accordance with the monthly payments established by the authority, the commissioner of finance and administration shall deliver by certified mail a written notice of such failure to the municipality within five (5) days of the failure. In the event the municipality fails to remit the amount set forth in such notice within sixty (60) days of the receipt of the notice, the commissioner shall, without further authorization, withhold such sum or part of such sum from any state-shared taxes which are otherwise apportioned to the municipality for the benefit of the authority. Furthermore, in the event any municipality having entered into a contract pursuant to this part fails to remit funds in accordance with the monthly payments established by the authority as aforementioned, the municipality shall increase its sewer user's fee and/or pledge additional available sources of revenue as are necessary to meet the obligation of the municipality according to its contract with the state.