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441.635
Leases between authority and local governments authorized -Contents.
The authority and any local government are authorized and empowered to enter into
a lease with respect to any project according to any agreement or agreements made
pursuant to KRS 441.630. Any lease may contain, in substance, any of the following
provisions and such other provisions not inconsistent herewith as the authority and
local government may deem appropriate and desirable:
(1) That the lease is for the remainder of the fiscal period in which it is dated and
executed, and is automatically renewable for the succeeding fiscal period, one
(1) at a time, until the final maturity date of the bond issue to which the lease is
related, or until the local government notifies the authority in writing within sixty
(60) days before the expiration of the lease that the local government will not
renew said lease;
(2) That with respect to the fiscal period in which the lease is dated and executed,
the local government shall otherwise be firmly bound only (a) to contribute to
the authority such portions, if any, of the cost of the project as the agreement
prescribes shall be paid by the local government; and (b) to pay the authority
the rental prescribed for such fiscal period;
(3) That if the local government shall fully perform all such obligations during such
initial term of the lease, it shall have an exclusive option to automatically renew
the lease at the time and in the manner prescribed for the ensuing fiscal period,
effective on the first day thereof; no local government shall be or become in
any way obligated to pay the rental stipulated for such fiscal year unless the
lease be so automatically renewed; and that the local government shall, upon
any such renewal, be firmly bound to pay to the authority the rental stipulated
for such fiscal period as a general obligation of the local government to be paid
from any funds available to the local government required by law or by
previous binding contract to be devoted to some other purpose;
(4) In like manner and subject to the same conditions and provisions as are set
forth in subsection (3) of this section, if the local government shall in the first
ensuing fiscal year fully perform its obligations and pay to the authority the
rental stipulated for such fiscal period, the local government shall have another
exclusive option to automatically renew such lease for another fiscal year, and
so on for successive fiscal periods until the final fiscal period for which the
lease may be renewed;
(5) That so long as the lease is renewed from time to time and the local
government fully performs all its obligations as lessee, including payment of the
rental stipulated in the lease,
(a) The revenues of the project shall be collected, segregated, distributed,
deposited, secured, disbursed and accounted for in strict conformity with
the proceedings and trust indenture of the authority, and the aggregate of
such revenues properly accounted for and deposited pursuant to said
proceedings and trust indenture shall, to the extent provided in the lease,
be a credit against the local government's rental or other obligations for
the current fiscal period under the term of the lease, and
(b) Any revenues collected pursuant to KRS 441.685, or other funds as may
be provided and made available to the authority by the Commonwealth or
other sources, and set aside pursuant to an agreement, shall be applied
as provided in said proceedings and trust indenture and shall, to the
extent provided in the lease, be a credit against the local government's
rental or other obligations for the then current fiscal period under the
lease.
Effective:July 15, 1982
History: Created 1982 Ky. Acts ch. 235, sec. 7, effective July 15, 1982.
2014-2016 Budget Reference. See State/Executive Branch Budget, 2014 Ky. Acts
ch. 117, Pt. I, H, 5, c, (2) at 651.
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