Public Funds and Financing - As enacted, broadens certain disclosure obligations of state and local governmental entities by requiring their disclosure of covenant violations and credit rating downgrades to the comptroller of the treasury or the comptroller's designee. - Amends TCA Section 9-21-134.

HB 136 amends Tennessee law (TCA Section 9-21-134) to require state and local governmental entities with finance transactions to disclose covenant violations (noncompliance with loan terms) and credit rating downgrades to the comptroller of the treasury within 10 business days. It also mandates disclosure of these events on the EMMA website if applicable. This directly affects public entities managing debt, such as cities, counties, and school districts that issue bonds. The bill adds specific definitions for "covenant violation" and "credit rating downgrade" to clarify reporting requirements. The law took effect after becoming Public Chapter 17 in March 2025.