KRS 154.22-040: Certification of qualified counties -- Loss of certification --

Coal-producing counties qualified for electric generation -- Selection of

eligible companies under Rural Economic Development Assistance

Program -- Limitation of applicability to nonprofit corporations with

handicapped and sheltered workers.

(1) Each year, the authority shall, under its Rural Economic Development

Assistance Program, on the basis of the final unemployment figures calculated

by the Department of Workforce Development in the Education and Labor

Cabinet, determine which counties have had a countywide rate of

unemployment exceeding the statewide unemployment rate of the

Commonwealth in the most recent five (5) consecutive calendar years, or

which have had an average countywide rate of unemployment exceeding the

statewide unemployment rate of the Commonwealth by two hundred percent

(200%) in the most recent calendar year, and shall certify those counties as

qualified counties. A county not certified on the basis of final unemployment

figures may also be certified as a qualified county if the authority determines

the county is one (1) of the sixty (60) most distressed counties in the

Commonwealth based on the following criteria with equal weight given to each

criterion:

(a) The average countywide rate of unemployment in the most recent three

(3) consecutive calendar years, on the basis of final unemployment

figures calculated by the Department of Workforce Development in the

Education and Labor Cabinet;

(b) In each county the percentage of adults twenty-five (25) years of age and

older who have attained at least a high school education or equivalent, on

the basis of the most recent data available from the United States

Department of Commerce, Bureau of the Census; and

(c) Road quality, as quantified by the access within a county to roads ranked

in descending order from best quality to worst quality as follows: two (2)

or more interstate highways, one (1) interstate highway, a state four (4)

lane parkway, four (4) lane principal arterial access to an interstate

highway, state two (2) lane parkway and none of the preceding road

types, as certified by the Kentucky Transportation Cabinet to the

authority.

If the authority determines that a county which has previously been certified as

a qualified county no longer meets the criteria of this subsection, the authority

shall decertify that county. The authority shall not provide inducements for any

facilities in that county and an approved company shall not be eligible for the

inducements offered by KRS 154.22-010 to 154.22-070 unless the tax

incentive agreements required herein are entered into by all parties prior to

July 1 of the year following the calendar year in which the authority decertified

that county. In addition, the authority shall certify coal-producing counties, not

otherwise certified as qualified counties in this subsection, for economic

development projects involving the new construction of electric generation

facilities. A coal-producing county shall mean a county in the Commonwealth of

Kentucky that has produced coal upon which the tax imposed under KRS

143.020 was paid at any time. For economic development projects undertaken

in a regional industrial park, as defined in KRS 42.4588, or in an industrial park

created pursuant to an interlocal agreement in which revenues are shared as

provided in KRS 65.210 to 65.300, where the physical boundaries of the

industrial park lie within two (2) or more counties of which at least one (1) of the

counties is a qualified county under this section, an eligible company

undertaking an economic development project within the physical boundaries

of the industrial park may be approved for the inducements under KRS

154.22-010 to 154.22-080.

(2) The authority shall establish the procedures and standards for the

determination and approval of eligible companies and their economic

development projects by the promulgation of administrative regulations in

accordance with KRS Chapter 13A. The criteria for approval of eligible

companies and economic development projects shall include but not be limited

to the creditworthiness of eligible companies; the number of new jobs to be

provided by an economic development project to residents of the

Commonwealth; and the likelihood of the economic success of the economic

development project.

(3) The economic development project shall involve a minimum investment of one

hundred thousand dollars ($100,000) by the eligible company and shall result

in the creation by the eligible company, within two (2) years from the date of

the final approval authorizing the economic development project, of a minimum

of fifteen (15) new full-time jobs at the site of the economic development

project for Kentucky residents to be employed by the eligible company and to

be held by persons subject to the personal income tax of the Commonwealth.

The authority may extend this two (2) year period upon the written application

of an eligible company requesting an extension.

(4) (a) Within six (6) months after the activation date, the approved company

shall compensate a minimum of ninety percent (90%) of its full-time

employees whose jobs were created with base hourly wages equal to

either:

1. Seventy-five percent (75%) of the average hourly wage for the

Commonwealth; or

2. Seventy-five percent (75%) of the average hourly wage for the

county in which the project is to be undertaken.

(b) If the base hourly wage calculated in paragraph (a)1. or 2. of this

subsection is less than one hundred fifty percent (150%) of the federal

minimum wage, then the base hourly wage shall be one hundred fifty

percent (150%) of the federal minimum wage. However, for projects

receiving preliminary approval of the authority prior to July 1, 2008, the

base hourly wage shall be one hundred fifty percent (150%) of the federal

minimum wage existing on January 1, 2007. In addition to the applicable

base hourly wage calculated above, the eligible company shall provide

employee benefits equal to at least fifteen percent (15%) of the applicable

base hourly wage; however, if the eligible company does not provide

employee benefits equal to at least fifteen percent (15%) of the applicable

base hourly wage, the eligible company may qualify under this section if it

provides the employees hired by the eligible company as a result of the

economic development project total hourly compensation equal to or

greater than one hundred fifteen percent (115%) of the applicable base

hourly wage through increased hourly wages combined with employee

benefits.

(c) The requirements of this subsection shall not apply to eligible companies

which are nonprofit corporations established under KRS 273.163 to

273.387 and whose employees are handicapped and sheltered workshop

workers employed at less than the established minimum wage as

authorized by KRS 337.295.

For an eligible company, within a regional industrial park which lies within two

(2) or more counties, the calculation of the wage and benefit requirement shall

be determined by averaging the average county hourly wage for all counties

within the regional industrial park.

(5) No economic development project which will result in the replacement of

agribusiness, manufacturing, or electric generation facilities existing in the state

shall be approved by the authority; however, the authority may approve an

economic development project that:

(a) Rehabilitates an agribusiness, manufacturing, or electric generation

facility:

1. Which has not been in operation for a period of ninety (90) or more

consecutive days;

2. For which the current occupant of the facility has published a notice

of closure so long as the eligible company intending to acquire the

facility is not an affiliate of the current occupant; or

3. The title to which is vested in other than the eligible company or an

affiliate of the eligible company and that is sold or transferred

pursuant to a foreclosure ordered by a court of competent

jurisdiction or an order of a bankruptcy court of competent

jurisdiction;

(b) Replaces an agribusiness, manufacturing, or electric generation facility

existing in the Commonwealth:

1. The title to which shall have been taken under the exercise of the

power of eminent domain, or the title to which shall be the subject of

a nonappealable judgment granting the authority to exercise the

power of eminent domain, in either event to the extent that normal

operations cannot be resumed at the facility within twelve (12)

months; or

2. Which has been damaged or destroyed by fire or other casualty to

the extent that normal operations cannot be resumed at the facility

within twelve (12) months; or

(c) Replaces an existing agribusiness, manufacturing, or electric generation

facility located in the same qualified county, and the existing agribusiness,

manufacturing, or electric generation facility to be replaced cannot be

expanded due to the unavailability of real estate at or adjacent to the

agribusiness, manufacturing, or electric generation facility to be replaced.

Any economic development project satisfying the requirements of this

subsection shall only be eligible for inducements to the extent of the

expansion, and no inducements shall be available for the equivalent of

the agribusiness, manufacturing, or electric generation facility to be

replaced. No economic development project otherwise satisfying the

requirements of this subsection shall be approved by the authority which

results in a lease abandonment or lease termination by the approved

company without the consent of the lessor.

(6) With respect to each eligible company making an application to the authority

for inducements, and with respect to the economic development project

described in the application, the authority shall request materials and make

inquiries of the applicant as necessary or appropriate. Upon review of the

application and completion of initial inquiries, the authority may, by resolution,

give its preliminary approval by designating an eligible company as a

preliminarily approved company and authorizing the undertaking of the

economic development project. After preliminary approval, the authority may by

final approval designate an eligible company to be an approved company.