{"data":{"id":"us-ky/krs-154.30-030","jurisdiction":"us-ky","citation":"KRS 154.30-030","heading":"State tax increment financing participation programs -- Sunset --","body":"Application requirements for a local government to request state participation\n-- Authority review requirements -- Pledge limitations -- Tax incentive\nagreements required -- Independent consultant's report.\n(1) (a) The Commonwealth shall offer three (3) tax increment financing participation\nprograms. The first program, the criteria and details of which are set forth in\nKRS 154.30-040, relates to a pledge of state real pro perty ad valorem taxes\nonly. The second program, the criteria and details of which are set forth in\nKRS 154.30 -050, is the Signature Projects Program. The third program, the\ncriteria and details of which are set forth in KRS 154.30 -060, relates to the\npledge of state tax revenues to support mixed -use development in blighted\nurban areas.\n(b) 1. The first and third programs identified in paragraph (a) of this\nsubsection shall sunset on July 15, 2026, and new applications shall not\nbe submitted or considered for approval after July 15, 2026.\n2. The Signature Projects Program shall sunset on December 31, 2028, and\nnew applications shall not be submitted or considered for approval after\nDecember 31, 2028.\n3. Projects approved for a program prior to the date the p rogram shall\nsunset under subparagraph 1. or 2. of this paragraph shall continue to be\ngoverned in accordance with the tax incentive agreement's terms and\nconditions as set forth in KRS 154.30-070.\n4. Tax incentive agreements related to the programs under paragraph (a) of\nthis subsection and in effect on July 15, 2026, shall not be amended or\nhave activation date extensions approved by the Commonwealth after\nJuly 15, 2026.\n(2) (a) Except as provided in subsection (1)(b)3. of this section, a city or county t hat\nhas established a development area pursuant to KRS 65.7049, 65.7051, and\n65.7053, or an agency designated as the entity managing a development area\nestablished pursuant to KRS 65.7049, 65.7051, and 65.7053, may submit an\napplication to the authority requesting that the Commonwealth participate in a\nproject, before July 15, 2026.\n1. The application shall identify the specific program under which state\nparticipation is being requested and shall include the following\nattachments, in addition to any require ments developed by the authority\npursuant to paragraph (b) of this subsection:\na. A copy of the ordinance adopted by the city or county establishing\nthe development area;\nb. A copy of the local participation agreement; and\nc. Data and information supporting the determinations and findings\nrequired by KRS 65.7049.\n2. The staff of the authority shall review the application to determine if the\napplicant has met all of the statutory and regulatory requirements\nestablished by this subchapter and shall notify the applicant in writing of\nits determination. This review shall be preliminary in na ture and shall\nnot constitute approval of the request. All applications for participation\nby the Commonwealth shall be reviewed by the authority for approval.\n3. a. Applications meeting all statutory and regulatory requirements\nrequesting participation by the Commonwealth pursuant to KRS\n154.30-040, along with any supporting materials, shall be referred\nby the staff of the authority to the authority for consideration.\nb. i. Applicants meeting all statutory and regulatory requirements\nrequesting participatio n by the Commonwealth pursuant to\nKRS 154.30 -050(3)(b) or 154.30 -060 shall be required to\nsubmit a report prepared by an independent consultant or\nfinancial adviser as described in subsection (6) of this section\nfor the application to be complete. The staf f of the authority\nshall notify the applicants of the report requirements and\nshall provide information regarding the contents and\nrequirements for the report at the same time it notifies the\napplicant of the results of its preliminary review.\nii. Upon rec eipt and review of the report, the staff of the\nauthority shall refer  the application and supporting\ninformation to the authority for consideration.\n(b) Additional standards and requirements for the application process shall be\nestablished by the authorit y through the promulgation of administrative\nregulations in accordance with KRS Chapter 13A.\n(3) (a) The authority may request any materials and make any inquiries concerning\nan application that the authority deems necessary.\n(b) The authority shall, throu gh the promulgation of administrative regulations in\naccordance with KRS Chapter 13A, establish commercially reasonable\nlimitations on the financing costs that may be recovered under the provisions\nof KRS 154.30-050.\n(4) Upon review of an application and o ther information available, the authority may\npledge all or a portion of the state real property ad valorem tax incremental revenue\nof the Commonwealth or state tax revenues attributable to the footprint of the\nproject, as limited by KRS 154.30 -040, 154.30 -050, or 154.30 -060, whichever is\napplicable.\n(a) If incremental revenues are pledged from less than one hundred percent\n(100%) of the footprint of the project, a description of the included portion of\nthe development area shall be provided.\n(b) State tax revenues from the development area that have not been pledged to\nprojects within the development area may be used to support other economic\ndevelopment projects or tourism projects approved under KRS 139.536 and\n148.851 to 148.860, provided that state tax revenues shall not be pledged\nmore than once during the existence of the development area. Thus, state tax\nrevenues pledged to support increment bonds issued for the development area,\nor a project in the development area shall not be pledged to support any  other\ndevelopment area, project, program, development, or undertaking during the\nlife of the development area. If less than one hundred percent (100%) of\nincremental revenues are pledged pursuant to the provisions of this\nsubchapter, the remaining increme ntal revenues shall not be used to support\nother economic development projects or tourism projects approved under\nKRS 139.536 and 148.851 to 148.860.\n(5) The pledge of incremental state real property ad valorem tax revenues or state tax\nrevenues of the Com monwealth by the authority shall be implemented through the\nexecution of a tax incentive agreement between the Commonwealth and the agency,\ncity, or county, as the case may be, in accordance with KRS 154.30-070.\n(6) (a) The authority shall engage the servi ces of a qualified independent outside\nconsultant or financial adviser to analyze the data related to the project and\nthe development area and prepare the report required by subsection (2) of this\nsection. The report shall include the following:\n1. The estimated approved public infrastructure costs for the project and, if\nrelevant, approved signature project costs, financing costs, and costs\nassociated with land preparation, demolition, and clearance;\n2. The feasibility of the project, taking into account t he scope and location\nof the project;\n3. The estimated amount of local tax revenues and state tax revenues, as\napplicable, that would be generated by the project over the period,\nwhich may be up to twenty (20) years or thirty (30) years, as applicable,\nfrom the activation date;\n4. The estimated amount of local tax revenues and state tax revenues, as\napplicable, that would be displaced within the Commonwealth, for the\npurpose of quantifying economic activity which is being shifted over the\nsame period as tha t set forth in subparagraph 3. of this paragraph. The\nprojections for displaced activity shall include economic activity that is\nlost to the Commonwealth as a result of the project, as well as economic\nactivity that is diverted to the project that formerly took place at existing\nestablishments within the Commonwealth prior to the commencement\ndate of the project;\n5. The estimated amount of local and state old revenues that would have\nbeen generated in the footprint of the project in the absence of the\nproject, computed over the same time period as set forth in subparagraph\n3. of this paragraph;\n6. In the process of estimating the revenues and impacts prescribed in\nsubparagraphs 3. and 4. of this paragraph, the independent outside\nconsultant shall not consider any of the following:\na. Revenues or economic impacts associated with any projects within\nthe development area where the new project will be located; and\nb. Revenues or economic impacts associated with economic\ndevelopment projects and approved Kentucky Tourism\nDevelopment Act projects under KRS Chapter 148;\n7. The relationship of the estimated incremental revenues to the financing\nneeds, including any increment bonds, of the project;\n8. When estimating the fiscal impact of the project, the consultant shall\nevaluate the amount of revenue estimated in subparagraph 3. of this\nparagraph and shall deduct the amounts estimated in subparagraphs 4.\nand 5. of this para graph. The resulting difference shall be compared to\nthe estimated incremental revenues to determine the presence or absence\nof a positive fiscal impact; and\n9. A determination that the project will not occur if not for the designation\nof the development a rea, the granting of incremental revenues by the\ntaxing district or districts, other than the Commonwealth, and the\ngranting of the state tax incremental revenues.\n(b) 1. The independent consultant or financial advisor shall consult with the\nOffice of Stat e Budget Director, and the Finance and Administration\nCabinet in the development of the report.\n2. The Office of State Budget Director and the staff of the authority, in\ncollaboration with the independent consultant or financial advisor, shall\nagree on a m ethodology to be used and assumptions to be made by the\nindependent consultant or financial consultant in preparing its report.\n3. On the basis of the independent consultant's report and the other\nmaterials provided, prior to any approval of a project by t he authority,\nthe Office of State Budget Director and the Finance and Administration\nCabinet shall certify to the authority whether there is a projected net\npositive economic impact to the Commonwealth and the expected\namount of state tax incremental revenues from the project.\n4. The city, county, or agency making the application shall pay all costs\nassociated with the independent consultant's or financial advisor's report.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=57912","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:55Z","sha256":"c33264cd03ba20cb922528d28ee7a3077f7a82e37f11cbc1e6754cc751c976a6","source_id":"us-ky","stale":false,"prev":"us-ky/krs-154.30-020","next":"us-ky/krs-154.30-040"},"notice":"GroundRules: Original legal text. Not legal advice."}