(a)

(1)

(A) No state or local funds shall be expended by or on behalf of a medical school authority for a proposed project under this chapter nor shall bonds be issued by the state or bonds be guaranteed under § 7-90-114(b) on behalf of such project unless THEC, upon review of the proposed medical education program, specifically approves the program for public funding. The program shall not be approved for public funding unless THEC finds that such program is consistent with the purposes of this chapter, as expressed by the general assembly in § 7-90-102. In considering the program for such approval, THEC shall evaluate whether:

(i) The medical education program conflicts with the master plan for public higher education developed pursuant to § 49-7-202(c)(1);

(ii) The medical education program is unnecessarily duplicative of other programs offered within the region of Tennessee for which the project is proposed;

(iii) There are sufficient potential students in the region or who would be attracted to the region to justify and maintain the operation of the medical education program;

(iv) The market demand for potential graduates of the medical education program is sufficient to support the number of graduates produced; and

(v) The resources available in the region can sustain the medical education program.

(B) In making its decision, THEC may also consider other criteria found in § 7-90-123(a) and information developed by the feasibility study required by § 7-90-123.

(2) THEC approval is not required under this subsection (a), if the proposed project and medical education program will be funded exclusively with nonpublic funding and without the issuance of state bonds. A determination that THEC approval under this subsection (a) is not required shall not affect the requirements of § 7-90-123.

(3) THEC shall have the authority to contract with another entity to perform the evaluation required by this part, the cost of which shall be the sole responsibility of the authority or the municipality or municipalities creating the authority.

(4) The authority shall have a right to appeal THEC's action made pursuant to this section to the chancery court of Davidson County. Any such appeal shall be heard by the court de novo.

(b) The comptroller of the treasury or the comptroller's designee shall not approve a state bond issue under § 7-90-112(f) until the comptroller or the comptroller's designee has received and examined the approval of the associated medical education program by THEC pursuant to subsection (a).

(c) All state funds to be expended for a project of a medical school authority shall be specifically appropriated by reference to such project in the general appropriations act and such funds shall only be expended in accordance with the provisions of such act.