Tennessee Code Annotated

Tenn. Code Ann. § 49-3-314 (2026)

Conditions and requirements for LEA to receive state education finance funds

✓ current as of May 2026

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(a) [Deleted by 2022 amendment.]

(b) [Deleted by 2022 amendment.]

(c)
- (1) In order for any LEA to receive state education finance funds as set forth in part 1 of this chapter, the system shall meet the conditions and requirements set out in subdivisions (c)(2) and (3). In order to enforce those conditions and requirements, the commissioner may, in the commissioner's discretion, withhold a portion or all of the state education finance funds that the LEA is otherwise eligible to receive.
- (2) No LEA shall use state funds to supplant total local current operating funds, excluding capital outlay and debt service. This subdivision (c)(2) shall not apply to a newly created LEA in any county where the county and city schools are being combined for a period of three (3) years after the creation of the LEA.
- (3)
  - (A) Notwithstanding any other law to the contrary, for fiscal year 1992-1993 and any subsequent fiscal year, if state funding to the county for education is less than state funding to the county for education during the previous fiscal year, except that a reduction in funding based on fewer students in the county rather than actual funding cuts shall not be considered a reduction in funding for purposes of this subdivision (c)(3)(A), local funds that were appropriated and allocated to offset state funding reductions during any previous fiscal year are excluded from this maintenance of local funding effort requirement.
  - (B) It is the intent of subdivision (c)(3)(A) to allow local governments the option to appropriate and allocate funds to make up for state cuts without being subject to a continuation of funding effort requirement as to those funds for any year during which the state reinstates the funding, or restores the previous cuts, and during any subsequent year should the state fail to restore the funding cuts.
- (4)
  - (A) Notwithstanding any other law to the contrary, if, in any fiscal year, a local government appropriates funds for education for nonrecurring expenditures, including nonrecurring funds for priority schools, evidenced by a written agreement with the LEA establishing the nonrecurring use of the funds, then such funds must be excluded from the maintenance of local funding requirement and from any apportionment requirement under § 49-3-315(a). Before any such agreement takes effect, it must be reviewed by the department of education to ensure the nonrecurring nature of the expenditures.
  - (B) If, pursuant to subdivision (c)(4)(A), a local government appropriates nonrecurring funds for priority schools, evidenced by a written agreement with the LEA establishing the nonrecurring use of the funds, then such funds must be excluded from the maintenance of local funding requirement and from any apportionment requirement under § 49-3-315(a) for each year that the school is identified as a priority school plus one (1) additional year. Before any such agreement takes effect, it must be reviewed by the department of education to ensure the nonrecurring nature of the expenditures.

Amended by 2022 Tenn. Acts, ch. 966, s 14, eff. 7/1/2023.

Amended by 2022 Tenn. Acts, ch. 966, s 13, eff. 7/1/2023.

Amended by 2019 Tenn. Acts, ch. 439, s 1, eff. 5/22/2019.

Amended by 2016 Tenn. Acts, ch. 622, s 1, eff. 3/22/2016.

Amended by 2013 Tenn. Acts, ch. 305, s 1, eff. 4/29/2013.

Acts 1977, ch. 289, § 11; T.C.A., § 49-613; Acts 1984 (1st E.S.), ch. 6, § 14; 1987, ch. 280, §§ 2, 3; 1992, ch. 603, § 2; 2001, ch. 284, § 9.

Notes of Decisions

Cited in 5 cases (1 in the last 5 years), 1988–2022 · leading case: State Ex Rel. Weaver v. Ayers, 756 S.W.2d 217 (Tenn. 1988).

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State Ex Rel. Weaver v. Ayers, 756 S.W.2d 217 (Tenn. 1988). · cites it 2× “” See also T.C.A. § 49-3-314(c) (Supp.1987). Moreover, T.”

Reed v. Washington Cnty. Bd. of Educ., 756 S.W.2d 250 (Tenn. 1988). · cites it 2× “” See T.C.A. § 49-3-314. The chancellor found that the University School is a joint venture of both entities.”

State Ex Rel. Bd. of Educ. v. City of Memphis, 329 S.W.3d 465 (Tenn. Ct. App. 2010). · cites it 5× “The Board further asserted that it had been advised by the State Department of Education that the State would interpret any reduction in the total amount of local funding to be in violation of the anti-supplanting provisions contained in Tennessee Code Annotated § 49-3-314,…”

Metro. Gov't of Nashville & Davidson Cnty. v. Tennessee Dep't of Educ. - Concurring in Part & Dissenting in Part (Tenn. 2022). · cites it 4× “8 See Tenn. Code Ann. §§ 49-3-314 ; 49-6-2605(b)(1) (requiring the county school districts to “count[]” each student with a voucher account, “[f]or the purpose of funding calculations,” in their 3 As background, the ESA Act was first proposed to apply to Tennessee’s five largest…”

The City of Humboldt v. J.R. McKnight (Tenn. Ct. App. 2004). · cites it 2× “Tenn. Code Ann. § 49-3-304 . The distribution of state funds is governed by Tenn.”

— Tenn. Code Ann. § 49-3-314(c) — 2 cases

State Ex Rel. Weaver v. Ayers, 756 S.W.2d 217 (Tenn. 1988). “” See also T.C.A. § 49-3-314(c) (Supp.1987). Moreover, T.”

State Ex Rel. Bd. of Educ. v. City of Memphis, 329 S.W.3d 465 (Tenn. Ct. App. 2010). “The Board further asserted that it had been advised by the State Department of Education that the State would interpret any reduction in the total amount of local funding to be in violation of the anti-supplanting provisions contained in Tennessee Code Annotated § 49-3-314,…”

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