KRS 154.34-110: Purpose of subchapter -- Expenditure and employment retention

requirements for recovery of costs and tax incentives -- Legislative findings --

Annual report.

(1) The purpose of this subchapter is to provide a means for the Commonwealth to

promote job retention by providing incentives for existing businesses to reinvest in

existing operations in Kentucky for eligible companies.

(2) (a) To qualify for the incentives provided in this subchapter, an approved

company shall:

1. Incur eligible equipment and related costs of at least one million dollars

($1,000,000) for leased projects and at least two million five hundred

thousand dollars ($2,500,000) for all other reinvestment projects;

2. Agree to maintain a full -time employment base of at least eighty-five

percent (85%) at the facility on the date of preliminary approval; and

3. Not have been awarded incentives under Subchapter 26 of this chapter

for a period of at least five (5) years prior to applying for incentives

under this subchapter.

(b) An approved company meeting the expenditure and employment retention

requirements established by this subsection shall be eligible to recover up to

fifty percent (50%) of the amount expended for eligible equipment and related

costs. The actual amount that a n approved company may recover shall be

negotiated with the authority, and may be less than the maximum amount for

which the approved company is eligible.

(3) An approved company shall be eligible for incentives under this subchapter as

follows: tax incent ives of up to one hundred percent (100%) of the Kentucky

income tax imposed under KRS 141.020 or 141.040 and the limited liability entity

tax imposed under KRS 141.0401 on the income, Kentucky gross profits, or

Kentucky gross receipts of the approved compa ny generated by or arising from the

eligible project, as set forth in KRS 154.34-120.

(4) 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 rei nvestment and

development of existing industry in the Commonwealth;

(b) It is in the best interest of the Commonwealth to induce reinvestment in

existing facilities of eligible companies within the Commonwealth in order to

advance the public purposes of re lieving unemployment by preserving jobs

that may be lost if not for the incentives to be 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; and

(c) The authority prescribed by this subchapter and the purposes to be

accomplished under this subchapter are proper governmental and public

purposes for which public moneys may be expended.

(5) On or before November 1, 2021, and each November 1 thereafter, the authority

shall submit an overview report to the Interim Joint Committee on Appropriations

and Revenue and the Governor on the success or failure of each completed project

in order to deter mine the effectiveness of the program. The report shall include but

not be limited to the following information:

(a) The number of applications receiving preliminary approval during the fiscal

year;

(b) The number of final approvals issued during the fiscal year;

(c) The total amount of eligible equipment and other costs projected by the

approved company at preliminary approval;

(d) The total amount of eligible equipment and other costs actually incurred by

the approved company at final approval;

(e) The total number of full time jobs required to be preserved or retained as a

result of the reinvestment project;

(f) The total actual number of full -time jobs reported by the reinvestment project

as being preserved or retained on an annual basis;

(g) The maximum approved costs that may be recovered by the approved

companies for the reinvestment projects; and

(h) The location of the reinvestment projects receiving preliminary and final

approval during the fiscal year.