Municipal Government - As enacted, specifies penalties for a municipality that fails to timely provide the comptroller of the treasury with copies of audits of the accounts and records of all departments, boards, and agencies under the municipality's jurisdiction that receive and disburse funds. - Amends TCA Title 6, Chapter 56, Part 1.

SB 115 requires Tennessee municipalities to submit completed financial audits to the state comptroller within six months after their fiscal year ends. Municipalities with two or more overdue annual audits face penalties that reduce their state-distributed sales tax revenue by up to 15% per year until compliance is achieved. The withheld funds are held in reserve and returned once audits are submitted on time. This law directly affects municipalities that fail to meet audit submission deadlines and takes effect July 1, 2025.