{"data":{"id":"us-ky/krs-154.25-030","jurisdiction":"us-ky","citation":"KRS 154.25-030","heading":"Jobs retention project agreement -- Requirements, limitations, and","body":"permitted inducements.\n(1) The authority, upon adoption of its final approval, may enter into, with any\napproved company, an agreement with respect to the jobs retention proj ect. The\nterms and provisions of each agreement, including the amount of approved costs,\nthe amount of the inducement, the job maintenance requirement, and any\nlimitations the authority may deem necessary, shall be determined by negotiations\nbetween the authority and the approved company, except that each agreement shall\ninclude the following provisions:\n(a) The amount the approved company may recover through inducements under\nthis subchapter for the initial project, which shall be a negotiated percentage\nnot to exceed fifty percent (50%) of eligible costs. However, the authority\nmay negotiate an increase in the percentage such that both the initial project\nand any supplemental projects are eligible for seventy -five percent (75%) of\neligible costs upon appro val of a supplemental project. The adjustment to the\ninitial project shall be made on the total approved costs and any credits taken\nprior to the addition of a supplemental project shall then be subtracted from\nthat increased amount of approved costs. Neit her the initial project nor any\nsupplemental project shall ever be eligible for inducements greater than\nseventy-five percent (75%) of the eligible costs. The authority shall negotiate\na maximum allowable inducement for each year of the agreement, and the\napproved company may not recover inducements above that maximum in any\nyear during the term of the agreement, except that the annual maximum\nallowable inducement may be exceeded if a carry -forward of unused\ninducements from previous years exists. Any carry -forward of unused\ninducements will lapse upon maturity or termination of the agreement;\n(b) A provision that sets the activation date for the initial project within three (3)\nyears of the final approval. Prior to the activation date, the authority may\nextend the time for the completion of the jobs retention project and\ncompliance with the required investment upon request of the approved\ncompany for good cause; however, the ten (10) year period for the term of the\nagreement shall begin from the activation d ate. No inducements from the jobs\nretention project shall be available, other than the transferred credits provided\nfor under subsection (2) of this section, until activation. Upon activation, the\nbalance of transferred credits shall expire;\n(c) A provision that states that within three (3) months of the completion of the\njobs retention project, the approved company shall document the actual cost\nof the project in a manner acceptable to the authority. The authority may\nemploy an independent consultant or ut ilize technical resources to verify the\ncost of the project. The approved company shall reimburse the authority for\nthe cost of the consultant;\n(d) A provision that establishes a minimum required number of full-time jobs that\nmust be maintained at the site  of the jobs retention project and filled with\nresidents of the Commonwealth subject to Kentucky income tax and states\nthat the authorized inducements may be suspended at the discretion of the\nauthority from the date of noncompliance until the date complia nce is\nreestablished if the approved company's employment falls below the\nestablished minimum employment requirement. If the company does not\nincrease the number of full-time employees at the site who are residents of the\nCommonwealth and subject to Kentuc ky income tax sufficiently to meet the\nminimum employment requirement within one (1) year from the date of the\ninitial suspension, the remaining unused inducements may be terminated at\nthe discretion of the authority;\n(e) A provision that gives the authori ty discretion to suspend or terminate the\nauthorized inducements for any failure to comply with the terms of the\nagreement; and\n(f) 1. A provision that provides the term shall not be longer than the earlier of:\na. The date on which the approved company has  received\ninducements or withheld assessments equal to the amount that the\ncompany may recover under paragraph (a) of this subsection; or\nb. Ten (10) years from the activation date.\n2. The term in subparagraph 1. of this paragraph may be extended to a\nperiod longer than ten (10) years upon:\na. The approved company demonstrating that less than seventy -five\npercent (75%) of the incentives awarded under the agreement will\nbe claimed during the term of the agreement; or\nb. The addition of a supplemental project as negotiated and approved\nby the authority.\n3. An extension of the term shall not amend any provision of the\nagreement impacting the scope of the project or the maximum amount\nof incentives awarded under the agreement.\n(2) In consideration of the execution of the agreement, during the time the agreement is\nin effect, which time shall commence on the date of the agreement, the approved\ncompany may be permitted the following inducements:\n(a) Beginning on the effective date of the jobs retention agreement, which shall\nalso be the date of final approval, if the approved company has a balance of\nunused approved costs on a previously existing and active incentive\nagreement approved by the aut hority pursuant to KRS Chapter 154, the\napproved company may impose wage assessments on employees whose jobs\nare at the facility where the project defined in the previously existing\nincentive agreement was located. The wage assessments may be imposed as\nprovided in KRS 154.25 -040, and shall be available in an amount up to the\nbalance of transferred credits from the previously existing project.\n1. The transferred credits shall only be available to the approved company\nuntil the activation date, the term from  the original incentive agreement\nexpires, or the balance of transferred credits is exhausted, whichever\noccurs first; and\n2. Should the approved company exercise this option, the incentive\nagreement from which the credits were transferred shall be termina ted\nupon transfer and all parties shall be released from their obligations\nthereunder.\n(b) After the activation date:\n1. A one hundred percent (100%) credit against the taxes imposed by KRS\n141.020, 141.040, and 141.0401 that would otherwise be owed by the\napproved company, in the approved company's taxable year, as\ndetermined under KRS 141.402, on the taxable income, Kentucky gross\nreceipts, or Kentucky gross profits of the approved company generated\nby or arising from the jobs retention project. The order ing of credits\nshall be as provided in KRS 141.0205; and\n2. The aggregate assessment withheld by the approved company as\nprovided in KRS 154.25-040 in each year after the activation date;\n(c) The tax credits allowed to the approved company shall be equal t o the lesser\nof the total amount of the tax liability or the amount that the company may\nrecover under subsection (1)(a) of this section that has not yet been recovered,\nreduced by any recovery through the collection of assessments subject to the\nannual maximum inducements authorized pursuant to subsection (1)(a) of this\nsection. The credit shall be allowed for each taxable year of the approved\ncompany during the term of the agreement and for which a tax return of the\napproved company is filed until the amo unt that the company may recover\nunder subsection(1)(a) of this section has been received through a\ncombination of credits and assessments, if the company elects to impose\nassessments. The approved company shall not be required to pay estimated\ntax payment s as prescribed under KRS 141.044 or 141.305 on income,\nKentucky gross profits, or Kentucky gross receipts from the jobs retention\nproject. One hundred eighty (180) days after the filing of the tax return of the\napproved company, the Department of Revenue shall certify to the authority\nthe state tax liability for the preceding taxable year of the approved company\nand the amount of any tax credits taken pursuant to this section;\n(d) Prior to execution of the agreement, the eligible company shall secure from all\nlocal governmental authorities responsible for collecting local occupational\nlicense fees a resolution or order of the local governmental entities\nacknowledging and consenting to the termination or partial termination of the\nreceipt of local occupation al license fees on wages subject to the agreement\npaid by the approved company on behalf of its employees to the local\ngovernment entities;\n(e) If more than one (1) local occupational license fee is imposed upon the\nemployees of the approved company, the a ssessment imposed upon the\nemployees shall be credited against the local occupational license fee and\nshall be apportioned to each local occupational license fee according to each\nlocal occupational license fee's proportion to the total of all local occupa tional\nlicense fees for such employees. No credit or portion thereof shall be allowed\nagainst any local occupational license fee imposed by or dedicated solely to a\nlocal board of education; and\n(f) If, in any taxable year of the approved company during wh ich the agreement\nis in effect, the assessment collected from the wages of the employees exceeds\nthe expended portion of the amount that the approved company may recover\nunder paragraph (a) of this subsection, or exceeds the annual maximum\nnegotiated by th e authority, the assessment collected from the wages of the\nemployees shall cease for the remainder of that taxable year of the approved\ncompany. The approved company shall resume normal personal income tax\nand occupational license fee withholdings from th e employees' wages for the\nremainder of that taxable year, and the approved company shall remit to the\nCommonwealth and applicable local jurisdictions their respective shares of\nthe excess assessment collected on the withholding filing date for employees'\nwages next succeeding the first date when the approved company collected\nexcess assessments.\n(3) The jobs retention agreement and inducements available pursuant thereto shall not\nbe transferable or assignable by the approved company without the expressed\nwritten consent of the authority.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=57122","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:55Z","sha256":"a94f53a418cc1c63b93f5470518f72e757e9fcb0fd6bc074954c1cf9df3ca51b","source_id":"us-ky","stale":false,"prev":"us-ky/krs-154.25-020","next":"us-ky/krs-154.25-040"},"notice":"GroundRules: Original legal text. Not legal advice."}