KRS 175B.030: Projects connecting Kentucky and an adjoining state -- Bi-state

authority -- Formation -- Members -- Bi-state agreement -- Financial plan --

Legislative findings and declarations -- Approval of project connecting

Kentucky and Ohio.

(1) (a) 1. This section shall apply to any project that connects Kentucky with

any state that adjoins the Commonwealth. A proposal to construct a

project that connects Kentucky with an adjoining state shall be

contained in a financing plan prepared pursuant to subsection (6) of

this section. If approved, the project shall be constructed under the

supervision of the state authority, a bi-state authority, or both, and

may be financed by the state authority, a bi-state authority, a

public-private partnership, or any combination of these.

2. If the state authority, operating pursuant to KRS 175B.020,

participates in any capacity in the construction or financing of a

project that connects Kentucky with an adjoining state, the state

authority may assume all or part of the role of the bi-state authority

relative to that project.

(b) Subsections (2) to (4) of this section shall only apply to a bi-state

authority.

(c) Subsections (1) and (5) to (8) of this section shall apply to both a bi-state

authority and a public-private partnership.

(2) (a) A local government that contains a portion of a proposed project may, by

resolution of its governing body, request that its chief executive officer

and the Governor appoint a group of Kentucky members to negotiate with

a similar group from an adjoining state for the purpose of proposing the

creation of a bi-state authority composed of members from both states,

recognized under the laws of both states, and existing for the purpose of

financing, constructing, and operating a project or projects mutually

beneficial to both states.

(b) If established, the Kentucky membership of the bi-state authority shall

consist of seven (7) members, three (3) of whom shall be appointed by

the Governor, and four (4) of whom shall be appointed by the chief

executive of the local government in which the project is located. The four

(4) local government appointees shall be residents of the county in which

the project is located. If a project is located in a consolidated local

government, no more than two (2) appointees shall reside in the same

Kentucky senatorial district. If portions of the project are located in more

than one (1) local government, the chief executive of the county or

consolidated local government having the largest population shall make

the appointments authorized in this paragraph.

(c) Any proposed agreement to establish a bi-state authority shall be

presented to the state authority for approval. If the state authority

approves the agreement, it shall be submitted to the General Assembly

for ratification. If the agreement is ratified by the General Assembly, the

state authority shall authorize the establishment of a bi-state authority and

shall enter into an agreement with the adjoining state for the creation of a

bi-state authority.

(3) (a) Kentucky members of a proposed bi-state authority who are appointed by

the Governor shall be confirmed by the Senate in accordance with KRS

11.160. Members appointed by the chief executive of the local

government shall be confirmed by the governing body of the local

government.

(b) At least two (2) of the Governor's appointees and two (2) of the chief

executive's appointees shall be familiar with road and bridge design or

financing and administration of transportation infrastructure projects.

(c) Members of a bi-state authority appointed by the Governor shall serve for

four (4) years, except that initial appointments shall be as follows:

1. One (1) appointee shall serve a term of two (2) years;

2. One (1) appointee shall serve a term of three (3) years; and

3. One (1) appointee shall serve a term of four (4) years.

(d) The governing body of the local government requesting formation of the

bi-state authority shall, by resolution, establish term lengths for the initial

and succeeding members who are locally appointed, with each term not

to exceed four (4) years.

(e) Members of a bi-state authority representing the Commonwealth may be

reappointed upon the expiration of their terms. Members reappointed

shall be reconfirmed in the same manner as newly appointed members.

(4) (a) An agreement establishing a bi-state authority shall at a minimum:

1. Establish the total number of members of the bi-state authority;

2. Establish staffing and funding to support the work of the bi-state

authority;

3. Designate the process for selecting a presiding officer of the bi-state

authority, which shall include a requirement that a member from

each state share the duties of presiding; and

4. Require the approval of a majority of the members from each state

before any action may be taken or any change may be made by the

bi-state authority.

(b) A bi-state authority created pursuant to this section shall take the legal

form necessary to conform to the laws of both states. The Commonwealth

shall consider the bi-state authority to be an independent de jure

municipal corporation, constituting a governmental agency and

instrumentality of the appropriate jurisdictions. The bi-state authority shall

adopt a name indicative of its location and purpose.

(c) Any bi-state agreement approved pursuant to this section may be

presented to the United States Congress for consent thereof by joint

resolution as provided in Article 1, Section 10, Clause 3 of the United

States Constitution.

(5) (a) Members of a bi-state authority appointed from the Commonwealth shall

be considered public servants subject to KRS Chapter 11A.

(b) Members of a bi-state authority appointed from the Commonwealth shall

receive no compensation for their services, but shall be entitled to

reimbursement for all reasonable expenses necessary and incidental to

the performance of their duties and functions as members of the bi-state

authority.

(c) The following individuals or entities shall be prohibited from entering into

any contract or agreement with a bi-state authority or a public-private

partnership:

1. Any member of the bi-state authority appointed to represent the

Commonwealth or any member of the state authority, a project

authority, or a public-private partnership;

2. Any spouse, child, stepchild, parent, stepparent, or sibling of a

member of the bi-state authority appointed to represent the

Commonwealth or any spouse, child, stepchild, parent, stepparent,

or sibling of a member of the state authority, a project authority, or a

public-private partnership; and

3. Any corporation, limited liability entity, or other business entity of

which a person identified in subparagraph 1. or 2. of this paragraph

is an owner, member, or partner or has any other ownership

interest.

(d) A bi-state authority or public-private partnership shall comply with the

procurement laws of both states that are a party to the agreement

creating the bi-state authority or public-private partnership, including the

provisions of KRS Chapter 45A, in the development of a project and the

procurement of goods and services.

(e) A bi-state authority or public-private partnership shall comply with the

laws of both states concerning the inspection and disclosure of public

records, including KRS 61.870 to 61.884.

(f) A bi-state authority or public-private partnership shall comply with the

laws of both states concerning the conduct of open meetings, including

KRS 61.805 to 61.850.

(6) (a) Prior to the execution of any agreements for the construction of the

project, the state authority, the bi-state authority, a public-private

partnership, or any combination of these, if appropriate, shall prepare a

financial plan specifying the construction and financing parameters of the

project, including:

1. A timeline for construction of the project, including financing

requirements throughout the construction of the project;

2. The amount and duration of per-vehicle tolls;

3. Expected appropriations from the General Assembly to be used for

project costs; however, no financial plan shall be submitted or

approved which seeks or purports to bind any future General

Assembly to appropriate any moneys beyond those appropriated in

the most recently enacted biennial highway construction plan;

4. Other sources of funds and expected amounts; and

5. Other provisions relating to the construction and financing of the

project.

(b) 1. If the financial plan is prepared by a bi-state authority, the Kentucky

members of the bi-state authority shall consult with the involved

local governments in Kentucky, the department, and the Finance

and Administration Cabinet, Office of Financial Management, during

the development of the financial plan. Upon completion and

approval of the financial plan by the bi-state authority, the plan shall

be submitted to the state authority for approval.

2. If the financial plan is prepared by the state authority, the state

authority shall consult with the involved local governments in

Kentucky, the department, and the Finance and Administration

Cabinet, Office of Financial Management, during the development of

the financial plan. If the financial plan is viable based on all

information available to the state authority, the state authority shall

recommend the plan.

3. If the financial plan is prepared by a public-private partnership, the

public-private partnership shall consult with the involved local

governments in Kentucky, the department, and the Finance and

Administration Cabinet, Office of Financial Management, during the

development of the financial plan. Upon completion and approval of

the financial plan by the public-private partnership, the plan shall be

submitted to the state authority for approval.

(c) The state authority shall not approve or recommend a financial plan

which seeks or purports to bind any future General Assembly to

appropriate any moneys beyond those appropriated in the most recently

enacted biennial highway construction plan. If the financial plan is

approved or recommended by the state authority, the cabinet and, as

necessary, other state agencies or local governments may enter into a

development agreement as provided in subsection (7) of this section with

all necessary parties for the development of a project.

(d) Every financial plan prepared pursuant to this section shall include an

evaluation of the ability of a potential contractor or service provider to

quickly respond to the needs presented in a major transportation project,

and the importance of economic development opportunities represented

by the construction of any project under this chapter. In evaluating

proposals, preference shall be given to a plan that includes the

involvement of small businesses as subcontractors, to the extent that

small businesses can provide services in a competitive manner, unless

any preference interferes with the qualification for federal funds.

(7) (a) Upon approval or recommendation of the financial plan as provided in

subsection (6) of this section, a development agreement may be entered

into establishing the terms and conditions under which a project will be

undertaken and the duties, responsibilities, powers, and authorities of the

parties to the agreement. The development agreement shall, at a

minimum:

1. Require the bi-state authority or public-private partnership to submit

an annual report to the cabinet and the Legislative Research

Commission;

2. Require that an annual audit of the bi-state authority or

public-private partnership be performed by a certified public

accountant;

3. Include the relevant provisions from the financial plan required by

subsection (6) of this section;

4. Include provisions detailing the duties, responsibilities, and

obligations of each party in relation to the financing, development,

operation, and maintenance of the project, and the servicing and

retirement of all bonds;

5. Establish limits on any reserve funds created for operation,

maintenance, or bond servicing, which shall be at a level to

adequately operate and maintain the project and ensure proper

bond servicing;

6. Prohibit the amendment of the project or the financial plan without

the prior evaluation and approval by the state authority. No

amendment shall be approved that seeks or purports to bind any

future General Assembly to appropriate any moneys beyond those

appropriated in the most recently enacted biennial highway

construction plan;

7. If applicable, establish a process for the transfer of ownership of the

portion of the project that is within the Commonwealth to the

Commonwealth upon retirement of all bonds associated with the

project or, if the project utilizes a public-private partnership, upon

termination of that partnership; and

8. a. For a bi-state authority, require the approval of a majority of

the members from each state before any action may be taken

or any changes may be made by the bi-state authority; or

b. For a public-private partnership, require approval of the cabinet

before any action may be taken or any changes may be made

by the public-private partnership.

(b) The parties to the agreement from the Commonwealth shall consult with

the department and the Finance and Administration Cabinet, Office of

Financial Management, in the development of the agreement.

(c) Additional agreements may be executed, as necessary to complete the

project.

(d) The development agreement may take the form of a public-private

partnership agreement.

(8) The General Assembly hereby finds and declares that in carrying out the

functions, powers, and duties as prescribed in this chapter, a bi-state authority

or public-private partnership authorized under this section will be performing

essential public and government functions that improve the public welfare and

prosperity of the people of the Commonwealth by promoting the availability of

and enhancing accessibility to improved transportation services within the

Commonwealth.

(9) The state authority shall not enter into a public-private partnership related to a

project connecting the Commonwealth with the State of Ohio unless the

General Assembly expressly authorizes it by passing a joint resolution.