{"data":{"id":"us-ky/krs-42.355","jurisdiction":"us-ky","citation":"KRS 42.355","heading":"Examination and approval of projects -- Grants -- Administration --","body":"Conditions.\n(1) The Department for Local Government shall examine each capital project selected\nby the area development districts, and when it finds that a proposed project\nconforms to the requirements of KRS 42.350 to 42.370; that the estimated costs of\nthe project are reasonable; that the costs proposed to be paid from the fund are\nwithin the amount available; and that the proposed beneficiary agency will be\nreasonably able to fi nance the operation and maintain the capital project during its\nestimated useful life, the commissioner of the Department for Local Government\nshall approve it. If the Department for Local Government determines that a capital\nproject proposal does not conf orm to the requirements of KRS 42.350 to 42.370,\nthat the estimated costs of the project are excessive or unreasonable in light of the\npublic benefit to be derived from the project, or the unencumbered balance in the\nfund available for expenditure in the a rea development district is insufficient to pay\nthe costs of the project, or the part thereof proposed to be paid out of the fund, or\nthe beneficiary agency cannot reasonably finance the operation of or maintain the\ncapital project during its estimated use ful life, the project proposal shall be\ndisapproved by the Department for Local Government. The final decision to either\napprove or disapprove any project proposal shall be made no later than forty -five\n(45) days following official submittal of a complete proposal by the area\ndevelopment district, and the area development district shall be accordingly notified\nat that time.\n(2) The commissioner of the Department for Local Government may make direct\ngrants-in-aid of money out of the fund to any beneficiary a gency for the\nconstruction or acquisition of any approved capital project. When a direct grant -in-\naid has been made to a beneficiary agency, all contracts awarded for the purchase of\nmaterials, supplies, equipment, or services, except professional and tech nical\nservices, required for the construction or acquisition of the project shall be awarded\nto the lowest and best bidder in the discretion of the beneficiary agency after public\nadvertisement as required by KRS Chapter 424 or other applicable law. All\ncontracts awarded under this section for the construction, reconstruction, or\nrenovation of a building or other improvement to real estate shall be deemed\ncontracts for public works within the meaning of KRS 341.317 and KRS Chapter\n376 and other applicable s tatutes. All beneficiary agencies receiving a direct grant -\nin-aid under this subsection shall keep and maintain complete and accurate records\nof accounts of all expenditures of the grant moneys which shall be subject to audit\nby the Commonwealth for a peri od of five (5) years after completion of the capital\nproject. Beneficiary agencies shall complete approved capital projects within a\nreasonable period of time as determined by the Department for Local Government.\nUpon completion of capital projects, benefi ciary agencies shall submit project\ncompletion reports to the Department for Local Government as prescribed by the\nDepartment for Local Government and containing documents and information as\nmay be necessary to determine compliance with KRS 42.350 to 42.36 0 and other\napplicable statutes and administrative regulations. Beneficiary agencies shall be\nliable to repay to the fund any granted funds for failure to submit full project\ncompletion reports within a reasonable period of time or for expenditure of grant ed\nfunds in violation of statutes and regulations. No additional area development funds\nmay be approved until compliance, except at the discretion of the commissioner of\nthe Department for Local Government. Any grant moneys not required after all of\nthe costs of the capital project have been paid by the beneficiary agency shall be\npromptly returned to the Commonwealth for reallocation for expenditure for other\ncapital projects in the area development district to which the funds had been\noriginally allocated.\n(3) No capital project shall be constructed under KRS 42.350 to 42.370 except upon\nland to which (a) the Commonwealth, a political subdivision of the Commonwealth,\nor the beneficiary agency of the capital project has a good and marketable title, free\nof encumbrances, or (b) the beneficiary agency of the project has the right to the\nuninterrupted use, occupancy, and possession for a period longer than the estimated\nuseful life of the capital project; provided nothing herein shall prohibit the\nconstruction or renovation of public buildings on land with an existing\nencumbrance to secure payment of funds obtained for the acquisition or\nimprovement of said land. Each beneficiary agency shall execute and deliver to the\nCommonwealth its written assurances, which shall be binding on the agencies'\nsuccessors and assigns, guaranteeing that during its estimated useful life, the capital\nproject shall be operated and maintained for public purposes and pledging that no\nmortgage or other encumbrances shall be placed again st any capital project wholly\nfinanced out of the fund, except industrial development projects, for the breach of\nwhich assurances the Commonwealth shall have right of entry to the capital project\nand the beneficiary agency, or its successors and assigns, shall forthwith convey the\ntitle to the capital project to the Commonwealth. Similar assurances shall be\nexecuted and delivered to the Commonwealth by the beneficiary agencies of capital\nprojects financed in part out of the fund and in part from other sour ces, except that\nwhen additional funding is derived from the issuance and sale of revenue bonds or\nunder other statutorily authorized financing methods, to secure the repayment of\nwhich funds a statutory mortgage lien is granted in favor of any person or g roup of\npersons, the capital project may be encumbered to the extent authorized or required\nby the law under which the financing method was undertaken; nor shall anything in\nthis section prohibit the encumbrance of any real property located within an\nindustrial park or constituting an industrial site, developed or improved as a capital\nproject under KRS 42.350 and this section, by any person, firm, company,\npartnership, or corporation to which the property has been conveyed, to obtain\nfinancing for the cons truction upon the property of industrial and commercial\nbuildings. The written assurances provided by beneficiary agencies under this\nsection shall be lodged for recording and recorded in the office of the county clerk\nof the county in which the proposed project shall be located.","path":["KRS Chapter 42"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=22023","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:49:02Z","sha256":"21f53cc1264af0ff6808d9e6f881580fa3b4919503ceb121b916327b24afaa93","source_id":"us-ky","stale":false,"prev":"us-ky/krs-42.350","next":"us-ky/krs-42.360"},"notice":"GroundRules: Original legal text. Not legal advice."}