56.872 Applicability -- Report of secretary of Finance and Administration Cabinet to General Assembly -- Procedure when cost exceeds cost approved by General Assembly. - Kentucky Statutes

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56.872 Applicability -- Report of secretary of Finance and Administration Cabinet to General Assembly -- Procedure when cost exceeds cost approved by General
Assembly. (1) Notwithstanding the provisions of KRS 56.870(1), KRS 56.870 to 56.874 shall not apply to any financing by the Turnpike Authority of Kentucky until July 1, 1982,
and shall not apply to any refinancing transaction by any agency, authority, board,
corporation, cabinet, commission or other agency or instrumentality of the
Commonwealth, if such refinancing transaction results in a net debt service savings
to such agency, authority, board, corporation, cabinet, commission or other agency
or instrumentality of the Commonwealth. (2) The secretary of the Finance and Administration Cabinet shall report to the General Assembly in the branch budget recommendation, defined in KRS 48.010, on the net
debt service savings, any funds released from a debt service reserve fund or any
other funds generated as a result of any refinancing or other mechanism approved
by any agency, authority, board, corporation, cabinet, commission or other agency
or instrumentality of the Commonwealth after July 15, 1986. No portion of any net
debt service savings realized subsequent to a refinancing or open market bond
purchase and available during the biennium in which the savings are realized, any
debt service reserve fund released or other funds generated shall be expended for
any of the purposes for which such agency, authority, board, corporation, cabinet,
commission, or agency or instrumentality of the Commonwealth may be authorized
by law to perform. The General Assembly shall on a biennial basis appropriate the
net debt service savings as described, any debt service reserve fund or other funds
generated, reported by the Finance and Administration Cabinet, to a special escrow
account for each bond issue within the Finance and Administration Cabinet. The
proceeds within this account shall be used to accelerate the payment of outstanding
principal and interest, either through open market bond purchases or investments at
maximum yield, in addition to the amounts budgeted for such purposes over the
biennium, on definitive bonds, temporary bonds or interim financing secured by
bond anticipation notes, loan agreements or other means issued by an agency,
authority, board, corporation, cabinet, commission or other agency or
instrumentality of the Commonwealth. The Finance and Administration Cabinet
shall report to the General Assembly on a biennial basis the amount of total funds
utilized in the escrow account to retire the outstanding principal and interest and the
amount of principal and interest so retired, or to be retired, for each agency,
authority, board, corporation, cabinet, commission or other agency or
instrumentality of the Commonwealth. In the event that the funds appropriated to
the escrow account cannot be used in the biennium for the purposes prescribed by
this subsection, the Finance and Administration Cabinet shall so report and provide
the reasons therefor. The funds appropriated shall not lapse at the end of the
biennium but be carried forward to the next biennium to be utilized for the purposes
prescribed by this subsection. (3) In the event the cost of an authorized bond project exceeds its estimated cost, as approved by the General Assembly, the financing of such project may be authorized upon approval by the secretary of the Finance and Administration Cabinet, so long
as such cost does not exceed the estimated cost by more than twenty-five percent
(25%). In the case of financing of any bond project approved by the General
Assembly, the costs of issuance of bonds or notes shall be added to project costs in
determining the principal amount of authorized financing of any such project. Effective: July 15, 1986
History: Amended 1986 Ky. Acts ch. 452, sec. 1, effective July 15, 1986. -- Created 1980 Ky. Acts ch. 96, sec. 3, effective July 15, 1980.