KRS 44.065: Reciprocal agreements to offset claim of any person against the

Commonwealth to debt of that person owed to any federal, state, or local

government.

(1) Notwithstanding any other provision of the Kentucky Revised Statutes, and

pursuant to the provision s of 31 U.S.C. sec. 3716(b) and (h)(1), the Finance and

Administration Cabinet, at the request of any executive, judicial, or legislative

agency of the Commonwealth, may enter into a reciprocal agreement with the

United States government to offset the clai m of any person against the

Commonwealth to any debt of that person owed to the United States government

which has been certified by the United States government as final, due, and owing,

with all appeals and legal actions having been waived or exhausted, and to offset

any nontax claim of any person against the United States government to any

liquidated debt of that person owed to the Commonwealth.

(2) Notwithstanding any other provision of the Kentucky Revised Statutes, the Finance

and Administration Cabin et, at the request of any executive, judicial, or legislative

agency of the Commonwealth, may enter into a reciprocal agreement with any state,

as defined in KRS 446.010, to offset the claim of any person against the

Commonwealth to any debt of that person owed to any state which has certified the

debt as final, due, and owing, with all appeals and legal actions having been waived

or exhausted, and to offset any claim of any person against any state to any

liquidated debt of that person owed to the Commonwealth.

(3) In the case of multiple creditors who have certified liquidated debt against the same

person on a claim against the Commonwealth, pursuant to this section and KRS

44.030, the debts of the Commonwealth, counties, cities, urban -county

governments, consolidated local governments, and charter county governments shall

be credited first in the priority established in KRS 44.030, and if there is any

balance due the claimant after settling the whole demands of the Commonwealth,

counties, cities, urban -county governments, consolidated local governments, and

charter county governments, the balance shall be credited to the liquidated debts

certified by the United States government and any other state, as defined in KRS

446.010, in the order that the claims we re filed with the Treasury. If there is a

balance due the claimant after satisfaction of all liquidated debts as itemized in this

section or any court-ordered payments, the balance shall be paid to the claimant.