2021 Kentucky Revised Statutes Chapter 56 - State lands and buildings 56.510 Payments of costs -- Conveyance of title of industrial development, headquarters, or nonretail service and technology project -- Acquisition of public project by state -- Lease agreement or financing agreements.
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56.510
Payments of costs -- Conveyance of title of industrial development,
headquarters, or nonretail service and technology project -- Acquisition of
public project by state -- Lease agreement or financing agreements.
(1)
(2)
In carrying out the purposes of this chapter, and in providing for the expenditure of
funds for the acquisition of real estate or for a building project for the state or for
any state agency, the cabinet may find that the cost may be paid in whole or in part:
(a) Out of the funds appropriated specifically for capital outlay purposes;
(b) Out of funds directly appropriated to the involved state agency which may
legally be available for the purpose;
(c) Out of funds derived or which may be derived by the issuance and sale of
revenue bonds by the commission (but only for the purpose of acquiring
property for use by the state government or one of its departments or agencies,
but not including any independent municipal corporation or political
subdivision); or
(d) By any one (1) or a combination of said methods of financing. Any such
findings providing for the issuance and sale of bonds shall be submitted to the
commission for final determination. When any funds appropriated to or
standing to the credit of a particular state agency are to be used for a purpose
of the character above contemplated, the head of the agency may direct that
the funds be transferred to the credit of the Finance and Administration
Cabinet and made available for expenditure by the Finance and
Administration Cabinet for the agreed purpose. Industrial development,
headquarters, or nonretail service and technology projects may be financed by
the issuance of revenue bonds of the commission only at the request of the
Cabinet for Economic Development, subject to the provisions of subsection
(3) of this section.
In any case where the expenditures for the acquisition of real estate or for a building
project for the state or any state agency are to be financed in whole or in part by the
issuance or sale of revenue bonds, the commission may provide that the title to any
real estate which may be so acquired shall not vest in the Commonwealth until the
revenue bonds, together with interest thereon, have been paid in full. In such cases
the commission may, by agreement or in a trust indenture securing the payment of
such revenue bonds, provide that the title of such real estate may be vested in some
other state agency, or in a trustee named in such indenture, until the revenue bonds,
together with the interest thereon, have been paid in full. It shall be provided in any
such financing:
(a) That upon the retirement and discharge of the bonds, notes, or other
obligations issued by the commission at the direction of and on behalf of a
state agency, title to the public project or public projects so acquired shall vest
in the Commonwealth;
(b) That in the event of default with respect to such bonds, notes, or other
obligations, the Commonwealth shall have the exclusive option to acquire the
public project or public projects for the amount required to discharge such
(c)
(d)
(3)
(a)
(b)
bonds, notes, or other obligations, and is provided a reasonable time to
exercise such option;
That the issuance of such bonds, notes, or other obligations shall be directed
by and approved by such state agency not more than sixty (60) days prior to
the date of issue of such obligations; and
That no bonds, notes, or other obligations shall be issued by the commission
for and on behalf of such state agency except upon express direction of such
state agency.
In any case where the expenditures for the acquisition, installation and
construction of an industrial development, headquarters, or nonretail service
and technology project will be financed in whole or in part by the issuance or
sale of revenue bonds, the commission may provide that the title to the
industrial development, headquarters, or nonretail service and technology
project which may be so acquired shall be conveyed to the entity which will
occupy and utilize the industrial development, headquarters, or nonretail
service and technology project; provided, however, that such conveyance shall
only be made if:
1.
The subject entity agrees in writing prior to the issuance of any revenue
bonds to construct and acquire in connection with the industrial
development, headquarters, or nonretail service and technology project
facilities satisfactory to the commission;
2.
The commission makes a finding in writing, that, based upon diligent
investigation, the aggregate incremental taxes to be received by the
Commonwealth as a result of such project are reasonably expected, over
the life of the revenue bond issue, to be at least equal to the principal
amount of any revenue bonds issued to finance such project;
3.
The industrial development, headquarters, or nonretail service and
technology project is separately approved in writing by the Governor;
4.
The industrial development, headquarters, or nonretail service and
technology project is separately approved and authorized by the General
Assembly; and
5.
Any revenue bond proceedings for the financing of an industrial
development, headquarters, or nonretail service and technology project
provide that in the event of any disposition by an entity of any such
project previously conveyed to such industrial, headquarters, or nonretail
service and technology entity prior to the collection by the
Commonwealth of incremental taxes in the amount specified in
subparagraph 2. of this paragraph, the subject industrial, headquarters, or
nonretail service and technology entity shall pay to the Commonwealth
an amount equal to the difference between the aggregate incremental
taxes collected by the Commonwealth to such date of disposition and the
principal amount of such revenue bonds;
As an alternate to the initial conveyance of an industrial development,
(4)
headquarters, or nonretail service and technology project to an entity, such
project may be leased to such entity upon such terms as the commission and
the Cabinet for Economic Development shall determine to be proper, and in
such case, subject to the provisions of subparagraphs 1., 2., and 3. of
paragraph (a) of this subsection, provision may also be made for title to such
project to be conveyed to the subject entity at such time as the Commonwealth
has collected incremental taxes in respect of the project in an amount equal to
the principal amount of any revenue bonds issued to finance such industrial
development, headquarters, or nonretail service and technology project;
(c) It is hereby determined and declared as a legislative finding of fact that the
provisions and requirements of paragraphs (a) and (b) of this subsection
provide for the receipt by the Commonwealth of fair market value for any
industrial development, headquarters, or nonretail service and technology
project conveyed to an entity pursuant to this subsection; and
(d) The Cabinet for Economic Development is authorized and empowered to
initiate industrial development, headquarters, or nonretail service and
technology projects and to finance such projects pursuant to the provisions of
this chapter. When revenue bonds are issued for the financing of any such
project, the Cabinet for Economic Development is authorized and empowered
to enter into financing agreements or lease agreements with the commission
providing for the making of financing payments by the Cabinet for Economic
Development from appropriations made to the Cabinet for Economic
Development as, if and when received, for the amortization of revenue bonds
so issued, provided that no such obligation shall be binding upon the Cabinet
for Economic Development for a period extending beyond the legislative
biennium during which such obligation is incurred, but such obligation may
be renewed during successive biennial periods by the Cabinet for Economic
Development. The issuance of any revenue bonds, notes or other obligations
for the financing of industrial development, headquarters, or nonretail service
and technology projects shall be directed by and approved by the Cabinet for
Economic Development not more than sixty (60) days prior to the date of the
issue of such obligations, and no bonds, notes or other obligations shall be
issued by the commission for and on behalf of the Cabinet for Economic
Development, except upon such express direction and upon compliance with
this subsection. Any portion of an industrial development, headquarters, or
nonretail service and technology project may be financed by a city or county
of the Commonwealth in the same manner as a financing by the commission
under this section, KRS 56.513 and 56.514 or pursuant to the statutory
authority of such city or county. In such event, the Cabinet for Economic
Development may enter into similar financing agreements or lease agreements
with such city or county in order to make proper provision for such financing.
The cabinet, in providing for the expenditure of funds for any of the purposes
mentioned in this section, or the commission in providing for the issuance and sale
of revenue bonds, shall have power to provide by agreement with the state agency
affected, or by provision in the trust indenture securing the bonds, such terms and
conditions as may be considered appropriate and reasonable so as to permit either
the leasing to, and use by, any state agency of any building project or the
conveyance or lease of any industrial, headquarters, or nonretail service and
technology development project to any entity, any such building project to be paid
for by such state agency either:
(a) From its own appropriation;
(b) By the issuance of revenue bonds; or
(c) By means of a proposal to pay a rental for the use of all or any part of any
building proposed to be constructed and any such industrial, headquarters, or
nonretail service and technology development project to be paid for by the
Cabinet for Economic Development by the issuance of revenue bonds of the
commission, subject to the provisions of subsection (3) of this section, and
amortization of such revenue bonds by the Cabinet for Economic
Development.
The cabinet or the commission, in making any such lease agreement or financing
agreement, or in making provision in any trust indenture securing revenue bonds, is
authorized and empowered to lease all or any part of the facility financed for such
term and upon such conditions and for such considerations or enter into financing
agreements with the Cabinet for Economic Development in respect of any industrial
development, headquarters, or nonretail service and technology project as may
appear to be in the public interest.
Effective: July 14, 2018
History: Amended 2018 Ky. Acts ch. 199, sec. 2, effective July 14, 2018. -- Amended
1986 Ky. Acts ch. 350, sec. 3, effective April 8, 1986. -- Amended 1976 Ky. Acts ch.
205, sec. 3, effective October 1, 1976. -- Amended 1956 (1st Extra. Sess.) Ky. Acts
ch. 7, Art. XVI, sec. 9. -- Created 1949 (1st Extra. Sess.) Ky. Acts ch. 11, sec. 8.
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