{"data":{"id":"us-ky/krs-154a.600","jurisdiction":"us-ky","citation":"KRS 154A.600","heading":"Purchase, lease, or lease -purchase of goods or services -- Investigation of","body":"prospective contractees -- Disclosure requirements -- Prohibited contracts,\nexceptions -- Vendor's performance bond, letter of credit or deposit of security\n-- Liquidated damages -- Laws governing contracts.\n(1) The corporation may purchase, lease, or lease -purchase such goods or services as\nare necessary for effectuating the purposes of this chapter. Applicable leases,\npurchases, and lease -purchases shall be reported to the c apital projects and bond\noversight committee for its review and determination in accordance with the\nprovisions of KRS 45.750 to 45.810. The corporation shall not contract with any\nperson or entity for the total operation and administration of the state lo ttery, but\nmay make procurements which integrate functions such as lottery game design,\nlottery ticket distribution to retailers, supply of goods and services, and advertising.\nIn all procurement decisions, the corporation shall take into account the parti cularly\nsensitive nature of the state lottery and shall act to promote and ensure security,\nhonesty, fairness and integrity in the operation and administration of the lottery and\nthe objectives of raising net proceeds for the benefit of the public purpose described\nin this chapter.\n(2) The corporation shall investigate the financial responsibility, security, and integrity\nof any person who submits a bid, proposal or offer as part of a major procurement.\nAt the time of submitting such bid, proposal, or offer  to the corporation, the\ncorporation may require the following items:\n(a) A disclosure of the vendor's name and address and, as applicable, the name\nand address of the following:\n1. If the vendor is a corporation, the officers, directors, and each\nstockholder in such corporation; except that, in the case of owners of\nequity securities of a publicly traded corporation, only the names and\naddresses of those known to the corporation to own beneficially five\npercent (5%) or more of such securities need be disclosed;\n2. If the vendor is a trust, the trustee and all persons entitled to receive\nincome or benefit from the trust;\n3. If the vendor is an association, the members, officers, and directors; and\n4. If the vendor is a partnership or joint venture, all of th e general partners,\nlimited partners, or joint venturers.\n(b) A disclosure of all the states and jurisdictions in which the vendor does\nbusiness, and the nature of the business for each such state or jurisdiction.\n(c) A disclosure of all the states and jur isdictions in which the vendor has\ncontracts to supply gaming goods or services, including, but not limited to,\nlottery goods and services, and the nature of the goods or services involved for\neach such state or jurisdiction.\n(d) A disclosure of all the states and jurisdictions in which the vendor has applied\nfor, has sought renewal of, has received, has been denied, has pending, or has\nhad revoked a gaming license of any kind, and the disposition of such in each\nsuch state or jurisdiction. If any gaming li cense has been revoked or has not\nbeen renewed or any gaming license application has been either denied or is\npending and has remained pending for more than six (6) months, all of the\nfacts and circumstances underlying the failure to receive such a license  shall\nbe disclosed.\n(e) A disclosure of the details of any finding of guilt, in a state or federal court,\nagainst the vendor for any felony or any other criminal offense other than a\ntraffic violation.\n(f) A disclosure of the details of any bankruptcy, in solvency, reorganization, or\nany pending litigation of the vendor.\n(g) Such additional disclosures and information as the corporation may determine\nto be appropriate for the procurement involved. If the vendor subcontracts any\nsubstantial portion of the wo rk to be performed under the contract to a\nsubcontractor, the vendor shall disclose all of the information required by this\nsubsection for the subcontractor as if the subcontractor were itself a vendor.\n(3) A contract for a procurement with any vendor subj ect to subsection (2) of this\nsection who has not complied with the disclosure requirements described in\nsubsection (2) of this section shall not be entered into, and any contract with such a\nvendor is unenforceable. Any contract with a vendor who does not  comply with\nsuch requirements for periodically updating such disclosures during the tenure of\ncontract as may be specified in such contract shall be terminated by the corporation.\nThis subsection and subsection (2) of this section shall be construed broad ly and\nliberally to achieve the ends of full disclosure of all information necessary to allow\nfor a full and complete evaluation by the corporation of the competence, integrity,\nbackground and character of vendors for major procurements.\n(4) A contract shall not be entered into with any vendor who has been found guilty of a\nfelony committed within the preceding ten (10) years, unless the corporation\ndetermines that:\n(a) The vendor has been pardoned or the vendor's civil rights have been restored;\nand\n(b) Subsequent to such findings of guilt the vendor has engaged in the kind of\nlaw-abiding commerce and good citizenship that would reflect well upon the\nintegrity of the lottery; or\n(c) If the vendor is a firm, association, partnership, trust, corporation or ot her\nentity, the vendor has terminated its relationship with the individual whose\nactions directly contributed to the vendor's guilt.\n(5) Each vendor shall, at the execution of the contract with the corporation, post a\nperformance bond or letter of credit from a bank acceptable to the corporation, in an\namount equal to the full amount estimated to be paid annually to the vendor under\nthe contract. In lieu of the bond, a vendor may, to assure the faithful performance of\nits obligations, deposit and maintain w ith the State Treasurer securities that are\ninterest bearing or accruing and that, with the exception of those specified in\nparagraph (a) or (b) of this subsection, are rated in one (1) of the three (3) highest\nclassifications by an established nationally recognized investment rating service.\nSecurities eligible under this subsection are limited to:\n(a) Certificates of deposit issued by solvent banks or savings associations\norganized and existing under the laws of this state or under the laws of the\nUnited States and having their principal place of business in this state;\n(b) United States bonds, notes, and bills for which the full faith and credit of the\ngovernment of the United States is pledged for the payment of principal and\ninterest;\n(c) General obligation bonds and notes of any political subdivision of the state; or\n(d) Corporate bonds of any corporation that is not an affiliate or subsidiary of the\ndepositor. Such securities shall be held in trust and shall have at all times a\nmarket value at least eq ual to the full amount estimated to be paid annually to\nthe lottery vendor under contract.\n(6) Every contract entered into by the corporation pursuant to this section shall contain\na provision for payment of liquidated damages to the corporation for any br each of\ncontract by the vendor.\n(7) Each vendor shall be qualified to do business in this state and shall file appropriate\ntax returns as provided by the laws of this state. All contracts under this section\nshall be governed by the laws of this state.","path":["KRS Chapter 154A"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=3031","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:58Z","sha256":"4af3bb66437da2111f859a53bdc44714b966a27f7f2806a509f889dada1c0043","source_id":"us-ky","stale":false,"prev":"us-ky/krs-154a.450","next":"us-ky/krs-154a.650"},"notice":"GroundRules: Original legal text. Not legal advice."}