because a terra file is a lua file, so lua functions are allowed / encouraged.
a terra function denotes a region of code with (slightly) different rules (arrays indexed at 0, use of C apis, etc). Making all of lua low level is interesting, but that's not what this project was going for.
Something like "tfunction" may have been better - it's obvious that its still a function, and the leading t let's you easily guess / remember the connection to Terra.
Why would anyone do this? What's wrong with func, function, def, etc. ?