2018 Kentucky Revised Statutes CHAPTER 56 - STATE LANDS AND BUILDINGS .823 Reports on leases, exercise of options to purchase, completion of lease-purchase agreements, and lease modifications to Capital Projects and Bond Oversight Committee.
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56.823 Reports on leases, exercise of options to purchase, completion of
lease-purchase agreements, and lease modifications to Capital Projects
and Bond Oversight Committee.
(1)
(2)
(3)
The Finance and Administration Cabinet shall report information on leases and
lease modifications awarded pursuant to KRS 43.050, 48.111, and 56.800 to
56.823 to the Capital Projects and Bond Oversight Committee as required by
this section.
Any lease awarded pursuant to KRS 56.803, including all lease renewals
except automatic renewals permitted under KRS 56.806(1), for which the
annual rental cost will exceed one hundred thousand dollars ($100,000) shall
be reported to the Capital Projects and Bond Oversight Committee after a
proposed lease is arrived at but before execution. The report shall include:
(a) The name of the agency that will occupy the premises;
(b) The name of the lessor;
(c) The terms of the lease;
(d) The reason for the lease;
(e) A copy of the writing required by KRS 56.803(17);
(f) A statement as to whether the Finance and Administration Cabinet
complied with the requirements established in KRS 43.050, 48.111, and
56.800 to 56.823. If the cabinet has not complied with any requirement,
the cabinet shall explain why;
(g) An explanation of why the Finance and Administration Cabinet chose this
lessor over his competition; and
(h) A cost comparison between the cost per square foot of the leased space
and the average cost per square foot of comparable space the state
leases in the same county. If there are factors which make the
comparison misleading, the cabinet shall inform the committee of these
factors.
Any lease that incorporates a lease-purchase pursuant to KRS 56.806(5) shall
be reported to the Capital Projects and Bond Oversight Committee after a
proposed lease is arrived at but before execution.
(a) If a lease is awarded pursuant to KRS 56.803, the report shall include
the:
1.
Fair market value of the property as of the time the lessor and the
Commonwealth entered into the lease;
2.
Name and qualifications of each of the two (2) real estate appraisers
who determined the fair market value;
3.
Appraisal technique each appraiser employed; and
4.
Information required by subsection (2) of this section.
(b) 1.
Except as provided in subparagraph 2. of this paragraph, if a lease
is awarded pursuant to KRS 56.805(2), the report shall include the:
a.
Fair market value of the property at the time the lessor and the
Commonwealth entered into the lease;
b.
Name and qualifications of each of the two (2) real estate
(4)
(5)
(6)
(7)
appraisers who determined the fair market value;
c.
Appraisal technique each appraiser employed;
d.
Information required by paragraphs (a), (b), (c), (d), (f), (g), and
(h) of subsection (2) of this section; and
e.
Procedure the department followed to obtain the lease.
2.
If the federal government is the lessor, the report shall include the
substance of the lease-purchase.
Any lease awarded pursuant to KRS 56.805(2), including all lease renewals
except automatic renewals permitted under KRS 56.806(1), for which the
annual rental cost will exceed one hundred thousand dollars ($100,000) shall
be reported to the Capital Projects and Bond Oversight Committee after a
proposed lease is arrived at but before execution. The report shall state the
information required by paragraphs (a), (b), (c), (d), (f), (g), and (h) of
subsection (2) of this section and the procedure the department followed to
obtain the lease. The report shall also include a copy of the writing required by
KRS 56.805(2).
Any lease awarded as the result of an emergency described at KRS 56.805(3)
shall be reported to the Capital Projects and Bond Oversight Committee within
thirty (30) days after execution. The report shall include a copy of the certificate
or the certificate and the Governor's authorization, as appropriate, kept on file
pursuant to KRS 56.805(4) and shall further state:
(a) The information required by paragraphs (a), (b), (f), (g), and (h) of
subsection (2) of this section;
(b) The terms of lease before and after the emergency; and
(c) The procedure the department followed after the emergency to obtain a
lease.
Any built-to-suit lease awarded pursuant to KRS 56.8169 shall be reported to
the Capital Projects and Bond Oversight Committee after a proposed lease is
arrived at but before execution. The report shall state the information required
by paragraphs (a), (b), (c), (d), (f), (g), and (h) of subsection (2) of this section.
The report shall also include:
(a) The written finding and Governor's approval required by KRS 56.8161;
(b) The selection committee's ranking of firms required by KRS
56.8169(15)(a);
(c) The written reason for requesting best-and-final offers, if best-and-final
offers are requested, made pursuant to KRS 56.8169(16)(b);
(d) The selection committee's selection of the best best-and-final offer, if
best-and-final offers are requested, made pursuant to KRS
56.8169(16)(d);
(e) The certificates signed pursuant to KRS 56.8171(2); and
(f) The report prepared by the employee of the Auditor of Public Accounts
pursuant to KRS 56.8171(3).
If the Finance and Administration Cabinet decides to exercise an option to
purchase pursuant to KRS 56.806(4), the cabinet shall report to the Capital
Projects and Bond Oversight Committee after the decision is reached but
before the purchase occurs. The report shall include the:
(a) Fair market value of the property;
(b) Option price;
(c) Name and qualifications of each of the two (2) real estate appraisers who
set the fair market value;
(d) Appraisal technique each appraiser employed; and
(e) Rent paid by the Commonwealth prior to the exercise of the option.
(8) (a) When, pursuant to KRS 56.806(5)(a), the Finance and Administration
Cabinet attempts to complete a lease-purchase through lease payments
totally amortizing the fair market value of the leased property as of the
time the lessor and the Commonwealth entered into the lease, the cabinet
shall report to the Capital Projects and Bond Oversight Committee no
more than ninety (90) days before the final lease payment. The report
shall include the:
1.
Fair market value of the property at the time the lessor and the
Commonwealth entered into the lease;
2.
Name and qualifications of each of the two (2) real estate appraisers
who set the fair market value;
3.
Appraisal technique each appraiser employed; and
4.
Rent paid by the Commonwealth toward the purchase.
(b) When, pursuant to KRS 56.806(5)(b), the Finance and Administration
Cabinet attempts to complete a lease-purchase, the cabinet shall report to
the Capital Projects and Bond Oversight Committee no more than ninety
(90) days before the final lease payment. The report shall include the
terms of the lease purchase.
(9) When, pursuant to KRS 56.806(5), the Finance and Administration Cabinet
decides to attempt to complete a lease-purchase prior to the total amortization,
through lease payments, of the fair market value of the leased property as of
the time the lessor and the Commonwealth entered into the lease, the cabinet
shall report to the Capital Projects and Bond Oversight Committee after the
decision is reached but before the purchase occurs. The report shall state the
information required by paragraph (a) or (b) of subsection (8) of this section as
appropriate. The report shall also include the sum of money that must be paid
in addition to rent paid, in order to complete the purchase.
(10) If the Finance and Administration Cabinet, pursuant to KRS 56.806(5), includes
in a lease the lease-purchase of the leased property and thereafter becomes
aware that a purchase will not be achieved, within thirty (30) days after the
cabinet becomes aware, it shall notify the Capital Projects and Bond Oversight
Committee of the circumstances preventing the purchase.
(11) (a) Except in the case of an emergency as provided in paragraph (b) of this
subsection, any modification to an existing lease, made pursuant to KRS
56.813, that is less than fifty thousand dollars ($50,000) shall be reported
to the Capital Projects and Bond Oversight Committee within thirty (30)
days after execution, and any modification to an existing lease, made
pursuant to KRS 56.813, that is fifty thousand dollars ($50,000) or more
shall be reported to the Capital Projects and Bond Oversight Committee
before execution. In either case, the report shall consist of:
1.
The terms of the lease before and after modification;
2.
The reason for the modification;
3.
The name of the lessor;
4.
Any comments received from the public pursuant to KRS 56.813(4);
and
5.
A statement as to whether the Finance and Administration Cabinet
complied with the requirements in KRS 56.813. If the cabinet has
not complied with any requirement, the cabinet shall explain why.
(b) Any modification to an existing lease which is required because of an
emergency as described at KRS 56.805(3) shall be reported to the
Capital Projects and Bond Oversight Committee within thirty (30) days
after execution. The report shall include a copy of the certificate or the
certificate and the Governor's authorization, as appropriate, kept on file
pursuant to KRS 56.805(4) and shall further state:
1.
The terms of the lease before and after modification;
2.
The name of the lessor;
3.
Any comments received from the public pursuant to KRS 56.813(4);
and
4.
A statement that the Finance and Administration Cabinet complied
with the requirements in KRS 56.805(3) and (4) and in KRS 56.813.
If the cabinet has not complied with any requirement, the cabinet
shall explain why.
(12) Before beginning work on any improvements, renovations, or refitting of a
leased building under the provisions of KRS 56.813(2)(d), the cabinet shall
report to the Capital Projects and Bond Oversight Committee:
(a) A description of the project;
(b) Identification of the agency or agencies for which the improvements,
renovations, or refitting are being performed;
(c) An estimate of the total cost of the project;
(d) The source of funds for the project; and
(e) All the information required by KRS 45.793.
Effective:March 21, 2017
History: Amended 2017 Ky. Acts ch. 103, sec. 2, effective March 21, 2017. -Amended 2009 Ky. Acts ch. 78, sec. 48, effective June 25, 2009. -- Amended
1998 Ky. Acts ch. 539, sec. 4, effective July 15, 1998. -- Amended 1994 Ky.
Acts ch. 44, sec. 3, effective July 15, 1994. Amended 1992 Ky. Acts ch. 54,
sec. 13, effective July 14, 1992; and ch. 339, sec. 3, effective July 14, 1992. -Created 1990 Ky. Acts ch. 512, sec. 13, effective July 13, 1990.
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