Attorney General Opinions 
Relating to County Government

2001 Environment

• If a water system or wastewater facility is in a deficit position and is referred to the Water and Wastewater Financing Board, the proper method of accounting to be used to determine user rates to correct the deficit is the method found in T.C.A. § 68-221-1010(a)(2), as long as the system’s or facility’s user base remains at 900 or fewer customers.  Under this method, the depreciation of grant acquired assets is excluded from consideration in determining whether a deficit condition exists. This accounting method is used to determine whether a deficit exists, and it is used for subsequent financial audits.  Opinion No. 01-097 (June 13, 2001).