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342.829 Funding of authority -- Restrictions on use of funds.
(1)
(2)
(3)
(4)
The authority shall not receive any direct state general fund appropriation.
Initial funding for the authority shall be determined by the Governor and the
secretary of the Finance and Administration Cabinet. Funding methods may
include, but not be limited to, a loan from an existing state agency or agencies
to the authority. The maximum amount borrowed from all state agencies shall
not exceed seven million dollars ($7,000,000), to be repaid over a period not to
exceed ten (10) years from the original loan date. The Governor shall have the
authority to provide or secure additional funding necessary to maintain, for the
first thirty-six (36) months of its operation, the surplus the Governor deems
proper. The additional funding may come from any funds which may be
expended directly by the Governor or from nonstate-agency sources and,
regardless of source, shall be a loan to the authority. The rate of interest to be
applied to the loan shall be one percent (1%) higher than the average for the
long-term investment folder of the lending agency on the anniversary date of
the original loan. The interest rate shall be adjusted annually on the
anniversary date of the original loan. To minimize cash requirements and
interest obligations, the loan shall be executed as a line of credit against the
lending agency, so that only those funds actually required for initial start-up
operations, including the establishment of a surplus and reinsurance expenses,
are drawn down on an "as needed" basis.
Any executive branch agency of the Commonwealth and any public
corporation created by the Commonwealth, any statute to the contrary
notwithstanding, may lend money to the authority subject to the terms and
conditions of this section, and any loan made pursuant to this section shall not
be construed as a breach or violation of fiduciary duties contained in KRS
Chapter 386.
Funds collected by the authority shall not:
(a) Be loaned to the Commonwealth or any instrumentality or agency thereof;
(b) Be subject to transfer to the Commonwealth or any agency or
instrumentality thereof, except for repayment of the loan authorized in
subsections (2) and (3) of this section; or
(c) Be expended for any other purposes than as authorized by KRS 342.801
to 342.843 and KRS 304.13-340.
Effective:April 4, 1994
History: Created 1994 Ky. Acts ch. 181, Part 12, sec. 53, effective April 4, 1994.
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