KRS 39A.303: East Kentucky State Aid Funding for Emergencies (EKSAFE) fund.

(1) The East Kentucky State Aid Funding for Emergencies (EKSAFE) fund is

established and shall be:

(a) Administered by the Department of Military Affairs, Division of Emergency

Management, in accordance with this section;

(b) A separate fund to provide financial assistance for those located in the areas

named in the Presidential Declaration of a Major Disaster, designated FEMA -

4663-DR-KY, and impacted by the July 2022 storms and floodi ng that

occurred in the eastern Kentucky region; and

(c) Used to provide financial support to those located in the areas named in the

Presidential Declaration of a Major Disaster, designated FEMA -4663-DR-

KY, in the eastern Kentucky region to recover from t he devastation caused by

the storms and flooding.

(2) The Department of Military Affairs or the Division of Emergency Management

shall not publicly advertise or solicit contributions from the general public that

could potentially impact fundraising efforts of not-for-profit disaster relief agencies.

(3) The EKSAFE fund may receive state appropriations, gifts, grants, federal funds,

and any other funds, both public and private.

(4) Moneys in the EKSAFE fund as of June 30, 2023, through June 30, 2026, shall n ot

lapse and shall carry forward until June 30, 2026.

(5) Any interest earnings of the EKSAFE fund shall become a part of the EKSAFE

fund and shall not lapse.

(6) (a) Eligibility to receive financial support from the EKSAFE fund shall be limited

to a:

1. City, county, urban-county government, consolidated local government,

unified local government, or charter county government;

2. Nonprofit or public utility service provider;

3. State agency; or

4. School district;

that has disaster-related needs as a res ult of the devastation experienced from

the July 2022 storms and flooding.

(b) An eligible recipient may receive moneys for expenses to provide disaster and

recovery relief if the recipient:

1. Is located in the areas named in the Presidential Declaration of a Major

Disaster, designated FEMA -4663-DR-KY, relating to the storms and

flooding that occurred in July 2022; and

2. Has disaster -related needs in response to the storms and flooding that

occurred in July 2022.

(c) The financial support shall not cover any new construction inside the one

hundred (100) year floodplain area.

(d) 1. Eligible expenses shall be those used to support disaster and recovery

relief, including but not limited to:

a. i. Replacement or renovation of publicly owned buildings

damaged by the storms and flooding, but only to the extent

of damage directly caused by the storms and flooding; and

ii. Replacement, renovation, or expansion of an essential

government facility that was used for existing services at the

time of the disaster, incl uding police, fire, and ambulance

stations, functioning above capacity at the time of

application, but only to the extent of damage directly caused

by the storms and flooding;

b. Reimbursement for services, personnel, and equipment provided

during the response and recovery to communities impacted by the

storms and flooding, but only to the extent of damage directly

caused by the storms and flooding;

c. Funding to cities, counties, and publicly owned utilities for the

costs of replacement or repair of public ly owned buildings and

their contents due to the damage from the storms and flooding, but

only to the extent of damage directly caused by the storms and

flooding;

d. Assistance to cities and counties for expenses related to planning

efforts for rebuilding and recovering from the damage, but only to

the extent of damage directly caused by the storms and flooding;

e. Assistance to support disaster recovery and relief needs of local

school districts, but only to the extent of loss or damage directly

caused by the storms and flooding, including but not limited to:

i. Financial support for school districts that will experience a

default in bond payments; and

ii. Financial support to assist school districts with building and

tangible property replacement needs; and

f. Contracted employees to administer and report on the funds.

2. a. Moneys used for the eligible expenses described in subparagraph

1.a.i. or ii. of this paragraph shall be:

i. Issued in the form of a loan; and

ii. Used to replace, renovate, or expand an essential government

facility that was used for existing services at the time of the

disaster at up to one hundred twenty percent (120%) of

capacity at the time of application for proceeds.

b. Any loan issued under s ubdivision a. of this subparagraph shall

contain the following terms:

i. An interest rate of zero percent (0%);

ii. A time for repayment of no longer than twenty (20) years;

and

iii. A repayment structure of quarterly payments due on the

thirtieth day of M arch, June, September, and December of

each year until the loan is repaid.

c. The recipient of any loan issued under subdivision a. of this

subparagraph shall report to the Department of Military Affairs,

Division of Emergency Management, on a quarterly basis:

i. The amount of any insurance proceeds received related to the

replacement, renovation, or expansion of an essential

government facility for which the loan was granted; and

ii. The name and address of the insurance provider.

d. No later than November 1, 2023, and each November 1 thereafter,

the Department of Military Affairs, Division of Emergency

Management, shall compile the information reported by each

recipient under subdivision c. of this subparagraph and report the

compiled information to the In terim Joint Committee on

Appropriations and Revenue.

(7) Each recipient of moneys from the EKSAFE fund, including any agency of

Kentucky state government, shall:

(a) Retain documentation of a timely application for any applicable

reimbursement, including b ut not limited to federal emergency disaster grant

assistance, other financial disaster assistance, and insurance proceeds; and

(b) Adhere to the terms of the EKSAFE fund regarding reimbursement to the

Commonwealth if funds from other sources are subsequen tly received after

the receipt of financial assistance from the Commonwealth.

(8) (a) Moneys in the EKSAFE fund may be used for the advancement of moneys to

cities, counties, school districts, and nonprofit or public utility service

providers experiencing strained fiscal liquidity while awaiting reimbursement

from federal emergency management assistance or insurance claims and shall

not be used for capital improvements.

(b) Reimbursement of the advancement under paragraph (a) of this subsection

shall:

1. Be determined by the:

a. State-local finance officer within the Department for Local

Government for cities and counties, and nonprofit or public

utilities; and

b. Department of Education for school districts; and

2. Include a quarterly accounting of the adva ncement released and the

outstanding balance through June 30, 2026.

(9) (a) 1. If a recipient of moneys from the EKSAFE fund subsequently receives

moneys from any other source, the recipient shall reimburse the

Commonwealth for the amount of the moneys rec eived from the

EKSAFE fund.

2. Before July 1, 2026, all moneys reimbursed to the Commonwealth under

subparagraph 1. of this paragraph shall be deposited in the EKSAFE

fund within thirty (30) days, and shall be continuously appropriated.

3. After June 30, 2 026, all moneys reimbursed to the Commonwealth

under subparagraph 1. of this paragraph shall be deposited into the

budget reserve trust fund account established in KRS 48.705 within

thirty (30) days.

(b) 1. If a recipient receives moneys in the form of a l oan under subsection

(6)(d)2. of this section, the recipient shall reimburse the Commonwealth

for the amount of the moneys received from the EKSAFE fund

according to the repayment structure under subsection (6)(d)2.b.iii. of

this section.

2. Before July 1, 2026, all moneys reimbursed to the Commonwealth under

subparagraph 1. of this paragraph shall be deposited in the EKSAFE

fund within thirty (30) days, and shall be continuously appropriated.

3. After June 30, 2026, all moneys reimbursed to t he Commonwealth

under subparagraph 1. of this paragraph shall be deposited into the

budget reserve trust fund account established in KRS 48.705 within

thirty (30) days.

(10) The Division of Emergency Management shall promulgate administrative

regulations to carry out this section.

(11) The following reports shall be submitted to the Senate Standing Committee on

Appropriations and Revenue and the House Standing Committee on Appropriations

and Revenue or the Interim Joint Committee on Appropriations and Reven ue by the

tenth day of each month, beginning September 10, 2022, and ending July 10, 2026:

(a) A report from the Office of State Budget Director that includes:

1. The name of each recipient of moneys from the EKSAFE fund;

2. The dollar amount of moneys issued and the dates of issuance;

3. A description of how the moneys were used; and

4. A list of all requests:

a. Submitted, including the amount requested;

b. Denied, including a description of the reason for the denial; and

c. Where the amount awarded was g reater than or less than the

amount requested, including a description of the reason for the

increase or decrease; and

(b) A report from the Department of Education that includes:

1. The name of each school district receiving moneys from the EKSAFE

fund;

2. The dollar amount of moneys issued and the dates of issuance;

3. A description of how the moneys were used; and

4. A list of all requests:

a. Submitted, including the amount requested;

b. Denied, including a description of the reason for the denial; and

c. Where the amount awarded was greater than or less than the

amount requested, including a description of the reason for the

increase or decrease.