KRS 154.31-030: Application, approval, and monitoring process for sales and use tax

incentive -- Standards and criteria for approval -- Execution of agreement --

Annual report.

(1) The application, approval, and monitoring process under this subchapter shal l be as

follows:

(a) An eligible company with a proposed economic development project may

submit an application to the authority. The application shall include the

information required by subsection (3) of this section;

(b) Upon review of the application a nd any additional information submitted, the

authority may, by resolution, approve an economic development project and

authorize the negotiation and execution of an agreement pursuant to

subsection (4) of this section. Approval granted pursuant to this sub section

shall apply to a specific economic development project at a specific location

within the Commonwealth;

(c) Upon approval, the authority shall notify the department that an approved

company is eligible for a sales and use tax incentive under this su bchapter and

shall provide the department with the information necessary to monitor the

use of incentives by the approved company. The authority shall notify the

department if the agreement is extended or amended, or if the incentives are

transferred, and shall provide the department with the information necessary

to update its records; and

(d) The approved company shall be eligible to receive the sales and use tax

incentives authorized by the agreement upon the earlier of the completion of

the economic dev elopment project or expiration of the project term. The

approved company shall apply to the department for the sales and use tax

incentives as provided in KRS 139.535, and shall, during the project term,

submit all information required by the department as provided in KRS

139.535.

(2) The authority may establish standards for the review of applications and the

approval of eligible companies through the promulgation of administrative

regulations in accordance with KRS Chapter 13A. In reviewing applications a nd

establishing standards, the authority shall consider the creditworthiness of the

eligible company, employment opportunities for Kentucky residents, wages to be

paid, whether the eligible company is participating in other incentive programs

pursuant to KRS Chapter 154 for the project, the likelihood that the project will be

an economic success, and any other factors the authority determines to be relevant.

(3) The application submitted by an eligible company shall include but not be limited to

the following:

(a) A description of the proposed economic development project;

(b) The anticipated minimum investment in the proposed economic development

project;

(c) An estimate of the approved recovery amount that the company will seek;

(d) A timeline for completion of the proposed economic development project;

(e) Supporting documentation, as requested by the authority;

(f) Payment of any applicable application fee required by the authority; and

(g) Any other information requested by the authority.

(4) (a) Upon approval of an eligible company, the authority may enter into an

agreement with the approved company. The terms of the agreement shall be

determined by negotiations between the authority and the approved company,

and shall include but not be limited to the following provisions:

1. The project term;

2. A description of the economic development project;

3. The total approved recovery amount in each category for which the

approved company is eligible;

4. That the approved company shall maintain all record s and

documentation relating to eligible expenditures and the Kentucky sales

and use tax paid, and shall provide those records and documentation to

the authority or the department upon request;

5. That the approved company shall execute information -sharing

agreements prescribed by the department with contractors, vendors, and

other related parties to verify the costs of and payment of sales and use

tax on the tangible personal property eligible for the sales and use tax

incentive under this subchapter;

6. That the sales and use tax incentives shall not be assignable or

transferable without written notice to the authority and approval of the

authority; and

7. Any other provisions not inconsistent with this subchapter.

(b) The project term established in the agreement may be extended by approval of

the authority for good cause shown; however, the term shall not be extended

beyond seven (7) years from the date of approval.

(c) An approved company may transfer or assign its designation as an approved

company upon prior notification to the authority and approval of the authority

in a manner prescribed by the authority.

(5) The contents of a company's filings under this subchapter shall be subject to the

Kentucky Open Records Act, KRS 61.870 to 61.884.

(6) By November 1 of each year, the authority shall prepare an annual report and make

it available on the Cabinet for Economic Development Web site as required in KRS

154.12-2035.