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148.853 Legislative findings -- Qualifications for incentives -- Incentives available.
(1)
(2)
The General Assembly finds and declares that:
(a) The general welfare and material well-being of the citizens of the
Commonwealth depend in large measure upon the development of tourism in
the Commonwealth;
(b) It is in the best interest of the Commonwealth to provide incentives for the
creation of new tourism attractions and the expansion of existing tourism
attractions within the Commonwealth in order to advance the public purposes
of relieving unemployment by preserving and creating jobs that would not
exist if not for the incentives offered by the authority to approved companies,
and by preserving and creating sources of tax revenues for the support of
public services provided by the Commonwealth;
(c) The authorities granted by KRS 148.851 to 148.860 are proper governmental
and public purposes for which public moneys may be expended; and
(d) That the creation or expansion of tourism development projects is of
paramount importance mandating that the provisions of KRS 139.536 and
KRS 148.851 to 148.860 be liberally construed and applied in order to
advance public purposes.
To qualify for incentives provided in KRS 139.536 and 148.851 to 148.860, the
following requirements shall be met:
(a) For a tourism attraction project:
1.
The total eligible costs shall exceed one million dollars ($1,000,000),
except for a tourism attraction project located in a county designated as
an enhanced incentive county at the time the eligible company becomes
an approved company as provided in KRS 148.857(6), the total eligible
costs shall exceed five hundred thousand dollars ($500,000);
2.
In any year, including the first year of operation, the tourism attraction
project shall be open to the public at least one hundred (100) days; and
3.
In any year following the third year of operation, the tourism attraction
project shall attract at least twenty-five percent (25%) of its visitors from
among persons who are not residents of the Commonwealth;
(b) For an entertainment destination center project:
1.
The total eligible costs shall exceed five million dollars ($5,000,000);
2.
The facility shall contain a minimum of two hundred thousand (200,000)
square feet of building space adjacent or complementary to an existing
tourism attraction project or a major convention facility;
3.
The incentives shall be dedicated to a public infrastructure purpose that
shall relate to the entertainment destination center project;
4.
In any year, including the first year of operation, the entertainment
destination center project shall:
a.
Be open to the public at least one hundred (100) days per year;
b.
(c)
(d)
Maintain at least one (1) major theme restaurant and at least three
(3) additional entertainment venues, including but not limited to
live entertainment, multiplex theaters, large-format theater, motion
simulators, family entertainment centers, concert halls, virtual
reality or other interactive games, museums, exhibitions, or other
cultural and leisure-time activities; and
c.
Maintain a minimum occupancy of sixty percent (60%) of the total
gross area available for lease with entertainment and food and
drink options not including the retail sale of tangible personal
property; and
5.
In any year following the third year of operation, the entertainment
destination center project shall attract at least twenty-five percent (25%)
of its visitors from among persons who are not residents of the
Commonwealth;
For a theme restaurant destination attraction project:
1.
The total eligible costs shall exceed five million dollars ($5,000,000);
2.
In any year, including the first year of operation, the attraction shall:
a.
Be open to the public at least three hundred (300) days per year
and for at least eight (8) hours per day; and
b.
Generate no more than fifty percent (50%) of its revenue through
the sale of alcoholic beverages;
3.
In any year following the third year of operation, the theme restaurant
destination attraction project shall attract a minimum of fifty percent
(50%) of its visitors from among persons who are not residents of the
Commonwealth; and
4.
The theme restaurant destination attraction project shall:
a.
At the time of final approval, offer a unique dining experience that
is not available in the Commonwealth within a one hundred (100)
mile radius of the attraction;
b.
In any year, including the first year of operation, maintain seating
capacity of four hundred fifty (450) guests and offer live music or
live musical and theatrical entertainment during the peak business
hours that the facility is in operation and open to the public; or
c.
Within three (3) years of the completion date, the attraction shall
obtain a top two (2) tier rating by a nationally accredited service
and shall maintain a top two (2) tier rating through the term of the
agreement;
For a lodging facility project:
1.
a.
The eligible costs shall exceed five million dollars ($5,000,000)
unless the provisions of subdivision b. of this subparagraph apply.
b.
i.
If the lodging facility is an integral part of a major
convention or sports facility, the eligible costs shall exceed six
(3)
million dollars ($6,000,000); and
ii. If the lodging facility includes five hundred (500) or more
guest rooms, the eligible costs shall exceed ten million
dollars ($10,000,000); and
2.
In any year, including the first year of operation, the lodging facility
shall:
a.
Be open to the public at least one hundred (100) days; and
b.
Attract at least twenty-five percent (25%) of its visitors from
among persons who are not residents of the Commonwealth; and
(e) An expansion of any tourism development project shall in all cases be treated
as a new stand-alone project.
The incentives offered under the Kentucky Tourism Development Act shall be as
follows:
(a) An approved company may be granted a sales tax incentive based on the
Kentucky sales tax imposed on sales generated by or arising at the tourism
development project; and
(b) 1.
For a tourism development project other than a lodging facility project
described in KRS 148.851(14)(e) or (f), or a tourism attraction project
described in subparagraph 2. of this paragraph:
a.
A sales tax incentive shall be allowed to an approved company
over a period of ten (10) years, except as provided in subparagraph
5. of this paragraph; and
b.
The sales tax incentive shall not exceed the lesser of the total
amount of the sales tax liability of the approved company and its
lessees or a percentage of the approved costs as specified by the
agreement, not to exceed twenty-five percent (25%);
2.
For a tourism attraction project located in an enhanced incentive county
at the time the eligible company becomes an approved company as
provided in KRS 148.857(6):
a.
A sales tax incentive shall be allowed to the approved company
over a period of ten (10) years; and
b.
The sales tax incentive shall not exceed the lesser of the total
amount of the sales tax liability of the approved company and its
lessees or a percentage of the approved costs as specified by the
agreement, not to exceed thirty percent (30%);
3.
For a lodging facility project described in KRS 148.851(14)(e) or (f):
a.
A sales tax incentive shall be allowed to the approved company
over a period of twenty (20) years; and
b.
The sales tax incentive shall not exceed the lesser of total amount
of the sales tax liability of the approved company and its lessees or
a percentage of the approved costs as specified by the agreement,
not to exceed fifty percent (50%);
4.
5.
Any unused incentives from a previous year may be carried forward to
any succeeding year during the term of the agreement until the entire
specified percentage of the approved costs has been received through
sales tax incentives; and
If the approved company is an entertainment destination center that has
dedicated at least thirty million dollars ($30,000,000) of the incentives
provided under the agreement to a public infrastructure purpose, the
agreement may be amended to extend the term of the agreement up to
two (2) additional years if the approved company agrees to:
a.
Reinvest in the original entertainment destination project one
hundred percent (100%) of any incentives received during the
extension that were outstanding at the end of the original term of
the agreement; and
b.
Report to the authority at the end of each fiscal year the amount of
incentives received during the extension and how the incentives
were reinvested in the original entertainment destination project.
Effective: July 15, 2014
History: Amended 2014 Ky. Acts ch. 104, sec. 2, effective July 15, 2014. -- Amended
2009 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 37, effective June 26, 2009. -- Repealed,
reenacted, and amended 2001 Ky. Acts ch. 1, sec. 3, effective June 21, 2001. -Created 1996 Ky. Acts ch. 335, sec. 2, effective July 15, 1996.
Formerly codified as KRS 154.29-020.
Legislative Research Commission Note (6/26/2009). In codification, the Reviser of
Statutes has corrected a manifest clerical or typographical error in 2009 (1st Extra.
Sess.) Ky. Acts ch. 1, sec. 37, subsection (3)(b)1. and 2. (this statute), by replacing an
incorrect reference to "KRS 148.851(13)(e) or (f)" with the correct reference to
"KRS 148.851(14)(e) or (f)."
Legislative Research Commission Note (1/25/2009). This is former KRS 154.29-020
as amended by 2001 Ky. Acts ch. 1, sec. 3, and renumbered by the Reviser of
Statutes under KRS 7.136(1).
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