KRS 65.7063: Requirements for local participation agreements -- Pledge of incremental

revenues superior to other pledges of revenues.

(1) A local participation agreement shall be executed among the agencies and taxing

districts involved in administering or providi ng financing or pledging incremental

revenues to support the implementation of a development plan in a development

area. The local participation agreement shall be adopted by a city or county by

ordinance and by any other taxing authority or agency by reso lution, and shall

include but not be limited to the following provisions:

(a) Identification of the parties to the local participation agreement and the duties

and responsibilities of each entity under the agreement;

(b) Specific identification of the incr emental revenues released or pledged, or

wage assessments pledged by type of tax by each taxing district;

(c) The anticipated benefit to be received by each taxing district for the release or

pledge, including:

1. A detailed summary of old revenues collect ed and projected new

revenues for each taxing district on an annual basis for the term of the

local participation agreement; and

2. The maximum amount of incremental revenue to be paid by each taxing

district and the maximum number of years the payment will be effective;

(d) A detailed description of the development area, including a legal description

of the parcels included in the development area;

(e) A description of each proposed project that is the subject of a local

participation agreement, including an estimate of the costs of construction,

acquisition, and development;

(f) A requirement that pledged incremental revenues will be deposited in a

special fund established pursuant to KRS 65.7061, including the timing and

procedure for depositing incremental revenues and other pledged amounts into

the special fund;

(g) Terms of default and remedies, provided that no remedy shall permit the

withholding by any party to the local participation agreement of any

incremental revenues pledged to the special fund i f increment bonds are

outstanding that are secured by a pledge of those incremental revenues;

(h) The commencement date, activation date, and termination date; and

(i) Any other provisions not inconsistent with KRS 65.7041 to 65.7083 deemed

necessary or appropriate by the parties to the agreement.

(2) Any pledge of incremental revenues in a local participation agreement shall be

superior to any other pledge of revenues for any other purpose and shall, from the

activation date to the termination date set forth in the local participation agreement,

supersede any statute, ordinance, or resolution regarding the application or use of

incremental revenues. An ordinance in conflict with a local participation agreement

shall not be adopted while any increment bonds secured by that pledge remain

outstanding. Ordi nances or resolutions pledging incremental revenues on a

subordinate basis to any existing pledges may be adopted.