154.30.050 Signature Project Program -- Purpose -- Two programs -- Criteria for state participation -- Qualifying expenditures -- Authority review -- Required determinations by the authority -- Pledge - Kentucky Statutes

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Page 1 of 4 154.30-050 Signature Project Program -- Purpose -- Two programs -- Criteria for state participation -- Qualifying expenditures -- Authority review -- Required
determinations by the authority -- Pledge limitations -- Tax incentive
agreement required. (1) The Signature Project Program is hereby established. The purpose of this program is to encourage private investment in the development of major projects that will have
a significant impact on the Commonwealth of Kentucky and are judged to be of
such a magnitude that the effect upon the location of such project warrants
extraordinary public support. (2) There shall be two (2) separate initiatives under this program. The first initiative, the criteria and details of which are set forth in paragraph (a) of this subsection,
shall apply to qualifying projects that are not the subject of a contract under KRS
65.495 in effect on or before the March 23, 2007, but that have a project grant
agreement executed pursuant to KRS 154.30-070 prior to January 1, 2008. The
second initiative, the criteria and details of which are set forth in paragraph (b) of
this subsection, shall apply to projects that meet the specified requirements on or
after January 1, 2008.
(a) For projects that are not the subject of a contract under KRS 65.495 in effect on or before March 23, 2007, but that have a project grant agreement executed
pursuant to the provisions of KRS 154.30-070 prior to January 1, 2008:
1. The criteria for qualification shall be as follows:
a. The project shall represent new economic activity in the
Commonwealth; and b. The project shall result in a minimum capital investment of two
hundred million dollars ($200,000,000). 2. The following provisions shall apply to projects that meet the criteria
established in subparagraph 1. of this paragraph:
a. KRS 65.7051 shall not apply to the establishment of a
development area; b. The city or county in which the project is located shall adopt an
ordinance establishing the development area. The ordinance shall
be adopted in accordance with KRS 65.7053(1)(a), (b), (c), (d), (e),
(h), (i), (j), (k), (l), and (m); c. KRS 65.7049, 65.7053(2) and (3), 65.7057, 65.7059, 65.7061,
65.7063, 65.7065, and 65.7067, relating to local development
areas, shall apply; d. An application for state participation shall have been submitted as
provided in KRS 154.30-030. The application shall include the
information required by KRS 154.30-030(2)(a) 1.a. and b.; e. The report provided for in KRS 154.30-030(2)(a) 3.b. shall not be
required, and the certification required by KRS 154.30-030(6)(b)
shall not be required; Page 2 of 4 f. A project grant agreement shall be executed in accordance with
KRS 154.30-070; and g. KRS 154.30-080 and 154.30-090 shall apply. 3. Projects that meet the criteria established in subparagraph 1. of this
paragraph shall be eligible for the following:
a. Up to one hundred percent (100%) of approved public
infrastructure costs, excluding any sales and use tax paid, may be
recovered; b. Up to one hundred percent (100%) of the financing costs
associated with approved public infrastructure costs may be
recovered; c. In a county containing a city of the first class, the local
participation agreement may provide for the release of up to eighty
percent (80%) of the increment from the tax levied under KRS
91A.390 derived by the governing body within the project
development area. The amount released shall not exceed a base
amount of four hundred thousand dollars ($400,000) in the first
year of the local participation agreement, which base amount shall
be increased in each subsequent year of the grant agreement by
four percent (4%); and d. Up to one hundred percent (100%) of approved signature project
costs, excluding any sales and use taxes paid, subject to the
following: i. The authority shall review proposed expenditures for inclusion in the tax incentive agreement. The authority may approve the type of expenditures it determines are necessary
for completion of the private development; and ii. Approved signature project costs shall be detailed in the tax incentive agreement. (b) Beginning January 1, 2008: 1. A project shall meet all of the following criteria to be considered for
state participation under this program:
a. The project shall represent new economic activity in the
Commonwealth; b. The project shall result in a minimum capital investment of two
hundred million dollars ($200,000,000); c. The project shall result in a net positive economic impact to the
Commonwealth, taking into consideration any substantial adverse
impact on existing Commonwealth businesses. The net positive
impact shall be certified to the commission as required by KRS
154.30-030(6)(b); and Page 3 of 4 d. Not more than twenty percent (20%) of the capital investment or
twenty percent (20%) of the finished square footage shall be
devoted to the support or development of assets that will be
utilized for the retail sale of tangible personal property. 2. Projects that meet the criteria established by subparagraph 1. of this
paragraph shall comply with all relevant provisions of this subchapter. 3. Projects that meet the criteria established by subparagraphs 1. and 2. of
this paragraph shall be eligible to recover:
a. Up to one hundred percent (100%) of approved public
infrastructure costs, excluding any sales and use taxes paid; b. Up to one hundred percent (100%) of the financing costs
associated with approved public infrastructure costs; and c. Up to one hundred percent (100%) of approved signature project
costs, excluding sales and use taxes paid subject to the following: i. The authority shall review proposed expenditures for inclusion in the tax incentive agreement. The authority may approve the type of expenditures it determines are necessary for completion of the private development; and ii. Approved signature project costs shall be detailed in the tax incentive agreement. (3) The authority shall review the application, the certification required by KRS 154.30-030, if applicable, and supporting information as provided in KRS 154.30-
030. (4) The authority shall specifically identify the state taxes from which incremental revenues will be pledged. The authority may pledge up to eighty percent (80%) of
the incremental revenues from the identified state tax revenues from the footprint,
provided that the maximum amount of incremental revenues that may be pledged
for a project during the term of the tax incentive agreement from all approved state
taxes shall not exceed one hundred percent (100%) of approved public
infrastructure costs, approved signature project costs, and financing costs. (5) As part of the approval process, the authority shall determine the following: (a) The footprint of the project;
(b) The maximum amount of approved public infrastructure costs, approved signature project costs, and financing costs; (c) That the local revenues pledged to support the public infrastructure of the project, and local revenues pledged to support the overall project are of a
sufficient amount to warrant participation of the Commonwealth in the
project; (d) The termination date of the tax incentive agreement, not to exceed thirty (30) years from the activation date; (e) Any adjustments to be made to old revenues, in determining incremental revenues during each year of the term of the project grant agreement; and Page 4 of 4 (f) Any approved signature project costs; (6) For the purpose of making the determination required by KRS 139.515(2), the authority shall review the projected expenditures for tangible personal property used
in the construction of a signature project, as defined in KRS 139.515(1), and shall
establish an approximate percentage of the total anticipated expenditures that are
not included in the tax incentive agreement as approved public infrastructure costs
or approved signature project costs. This percentage shall be communicated by the
authority to the Department of Revenue, which shall use the information in
administering the sales tax refund permitted by KRS 139.515. (7) If state income taxes or local occupational license taxes are included for a project that includes office space, the authority shall consider the impact of pledging theses
taxes on the ability to utilize other economic development projects at a later date. (8) The pledge of state incremental tax revenues of the Commonwealth by the authority shall be implemented through the execution of a tax incentive agreement between
the Commonwealth and the agency, city, or county in accordance with KRS 154.30-
070. Effective: July 15, 2008
History: Repealed, reenacted, and amended 2008 Ky. Acts ch. 178, sec. 18, effective July 15, 2008. -- Created 2007 Ky. Acts ch. 95, sec. 18, effective March 23, 2007. Formerly codified as KRS 65.7075.