Session of 2000
Effective: Kansas Register

HOUSE BILL No. 3019
An Act concerning the Kansas development finance authority; authorizing the issuance of
      bonds for certain purposes; amending K.S.A. 1999 Supp. 74-8905 and repealing the
      existing section; also repealing K.S.A. 1999 Supp. 74-8905a.


     
Be it enacted by the Legislature of the State of Kansas:

      Section  1. K.S.A. 1999 Supp. 74-8905 is hereby amended to read as
follows: 74-8905. (a) The authority is hereby authorized and empowered
to may issue bonds, either for a specific activity or on a pooled basis for
a series of related or unrelated activities or projects duly authorized by a
political subdivision or group of political subdivisions of the state in such
amounts as shall be amounts determined by the authority for the purpose
of financing projects of statewide as well as local importance as defined
pursuant to K.S.A. 12-1744, and amendments thereto, capital improve-
ment facilities, educational facilities, health care facilities and housing
developments. Nothing in this act shall be construed to authorize the
authority to issue bonds or use the proceeds thereof to:

      (1) Purchase, condemn, or otherwise acquire a utility plant or distri-
bution system owned or operated by a regulated public utility or;

      (2) finance any capital improvement facilities, educational facilities,
or health care facilities which are authorized under the laws of the state
to may be financed by the issuance of general obligation or utility revenue
bonds of a political subdivision, except that the acquisition by the au-
thority of general obligation or utility revenue bonds issued by political
subdivisions with the proceeds of pooled bonds shall not violate the pro-
visions of the foregoing; or

      (3) purchase, acquire, construct, reconstruct, improve, equip, furnish,
repair, enlarge or remodel property for any swine production facility on
agricultural land which is owned, acquired, obtained or leased by a cor-
poration, limited liability company, limited partnership, corporate part-
nership or trust.

      Nothing in this subsection (a) shall prohibit the issuance of bonds by
the authority when any statute specifically authorizes the issuance of
bonds by the authority or approves any activity or project of a state agency
for purposes of authorizing any such issuance of bonds in accordance with
this section and provides an exemption from the provisions of this sub-
section (a).

      (b) The authority is hereby authorized and empowered to may issue
bonds for activities and projects of state agencies as requested by the
secretary of administration. No bonds may be issued pursuant to this act
for any activity or project of a state agency unless the activity or project
either has been approved by an appropriation or other act of the legis-
lature or has been approved by the state finance council acting on this
matter which is hereby characterized as a matter of legislative delegation
and subject to the guidelines prescribed in subsection (c) of K.S.A. 75-
3711c, and amendments thereto. When requested to do so by the sec-
retary of administration, the authority is further authorized and empow-
ered to may issue bonds for the purpose of refunding, whether at maturity
or in advance of maturity, any outstanding bonded indebtedness of any
state agency. The revenues of any state agency which are pledged as
security for any bonds of such state agency which are refunded by re-
funding bonds of the authority may be pledged to the authority as security
for the refunding bonds.

      (c) The authority is hereby authorized and empowered to may issue
bonds for the purpose of financing industrial enterprises, agricultural
business enterprises, educational facilities, health care facilities and hous-
ing developments, or any combination of such facilities, or any interest
in facilities, including without limitation leasehold interests in and mort-
gages on such facilities. No less than 30 days prior to the issuance of any
bonds authorized under this act with respect to any project or activity
which is to be undertaken for the direct benefit of any person or entity
which is not a state agency or a political subdivision, written notice of the
intention of the authority to provide financing and issue bonds therefor
shall be given by the president of the authority to the governing body of
the city in which the project or activity is to be located, or,. If the project
or activity is not proposed to be located within a city, such notice shall be
given to the governing body of the county. No bonds for the financing of
the project or activity shall be issued by the authority for a one-year period
if, within 15 days after the giving of such notice, the governing body of
the political subdivision in which the project or activity is proposed to be
located shall have duly enacted adopted an ordinance or resolution stating
express disapproval of the project or activity and shall have notified the
president of the authority of such disapproval.

      (d) The authority is hereby authorized and empowered to may issue
bonds for the purpose of establishing and funding one or more series of
venture capital funds in such principal amounts, at such interest rates, in
such maturities, with such security, and upon such other terms and in
such manner as is approved by resolution of the authority. The proceeds
of such bonds not placed in a venture capital fund or used to pay or
reimburse organizational, offering and administrative expenses and fees
necessary to the issuance and sale of such bonds shall be invested and
reinvested in such securities and other instruments as shall be provided
in the resolution under which such bonds are issued. Moneys in a venture
capital fund shall be used to make venture capital investments in new,
expanding or developing businesses, including, but not limited to, equity
and debt securities, warrants, options and other rights to acquire such
securities, subject to the provisions of the resolution of the authority. The
authority shall establish an investment policy with respect to the invest-
ment of the funds in a venture capital fund not inconsistent with the
purposes of this act. The authority shall enter into an agreement with a
management company experienced in venture capital investments to
manage and administer each venture capital fund upon terms not incon-
sistent with the purposes of this act and such investment policy. The
authority may establish an advisory board to provide advice and consulting
assistance to the authority and the management company with respect to
the management and administration of each venture capital fund and the
establishment of its investment policy. All fees and expenses incurred in
the management and administration of a venture capital fund not paid or
reimbursed out of the proceeds of the bonds issued by the authority shall
be paid or reimbursed out of such venture capital fund.

      (e) The authority is hereby authorized and empowered to may issue
bonds in one or more series for the purpose of financing a project of
statewide as well as local importance in connection with a redevelopment
plan that is approved by the authority in accordance with K.S.A. 1999
Supp. 74-8921 and 74-8922, and amendments thereto.

      (f) After receiving and approving the feasibility study required pur-
suant to section 2, and amendments thereto, the authority may issue bonds
in one or more series for the purpose of financing a multi-sport athletic
project in accordance with sections 2 through 4, and amendments thereto.
If the project is to be constructed in phases, a similar feasibility study
shall be performed prior to issuing bonds for the purpose of financing
each subsequent phase.

      (g) The authority may issue bonds for the purpose of financing resort
facilities, as defined in subsection (a) of K.S.A. 32-867, and amendments
thereto, in an amount or amounts not to exceed $30,000,000 for any one
resort. The bonds and the interest thereon shall be payable solely from
revenues of the resort and shall not be deemed to be an obligation or
indebtedness of the state within the meaning of section 6 of article 11 of
the constitution of the state of Kansas. The authority may contract with
a subsidiary corporation formed pursuant to subsection (v) of K.S.A. 74-
8904, and amendments thereto, or others to lease or operate such resort.
The provisions of K.S.A. 32-867, 32-868, 32-870 through 32-873 and 32-
874a through 32-874d, and amendments thereto, shall apply to resorts
and bonds issued pursuant to this subsection.

      (f) (h) The authority is hereby authorized and empowered to may use
the proceeds of any bond issues herein authorized, together with any
other available funds, for venture capital investments or for purchasing,
leasing, constructing, restoring, renovating, altering or repairing facilities
as herein authorized, for making loans, purchasing mortgages or security
interests in loan participations and paying all incidental expenses there-
with, paying expenses of authorizing and issuing the bonds, paying inter-
est on the bonds until revenues thereof are available in sufficient amounts,
purchasing bond insurance or other credit enhancements on the bonds,
and funding such reserves as the authority deems necessary and desirable.
All moneys received by the authority, other than moneys received by
virtue of an appropriation, are hereby specifically declared to be cash
funds, restricted in their use and to be used solely as provided herein.
No moneys of the authority other than moneys received by appropriation
shall be deposited with the state treasurer.

      (g) (i) Any time the authority is required to publish a notification
pursuant to the tax equity and fiscal responsibility act of 1982, the au-
thority shall further publish such notification in the Kansas register.

      (h) (j) Any time the authority issues bonds pursuant to this section,
the authority shall publish notification of such issuance of bonds at least
14 days prior to any bond hearing in the official county newspaper where
such bonds will be used of the county in which the project or activity
financed by such bonds are located and in the Kansas register.

      New Sec.  2. (a) As used in this act:

      (1) "Board" means the board of trustees of Kansas City Kansas com-
munity college;

      (2) "foundation" means the Kansas multi-sport and recreation foun-
dation;

      (3) "increment" means that amount of state and local sales tax reve-
nue imposed pursuant to K.S.A. 12-187 et seq. and 79-3601 et seq., and
amendments thereto, collected from taxpayers doing business within the
boundaries of the project area that is in excess of the amount of such
taxes collected prior to the date the resolution authorizing the project was
adopted by the board;

      (4) "project" means the construction of a multi-sport athletic complex
and the improvement of facilities within the project area; and

      (5) "project area" means the boundaries of the area in which the
project will be undertaken as described by the board, but shall not include
the boundaries of any redevelopment district in a major tourism area
which includes an auto race track facility located in Wyandotte county as
follows: Beginning at the intersection of Interstate 70 and Interstate 435;
west along Interstate 70 to 118th Street; north along 118th Street to State
Avenue; northeasterly along proposed relocated State Avenue to 110th
Street; north along 110th Street to Parallel Parkway; east along Parallel
Parkway to Interstate 435; South along Interstate 435 to Interstate 70.

      (b) The board or the foundation on behalf of the board may under-
take a project. Such a project may be undertaken in one or more phases.
Prior to undertaking a project, the board shall adopt a resolution stating
its intent to undertake the project, describing the nature of the proposed
project, a detailed description of all of the buildings and facilities that are
proposed to be constructed or improved in the project area, describing
the boundaries of the area in which the proposed project will be under-
taken, giving an estimate of the cost of such project and establishing a
date for completion of the project. Any addition or changes to the project
which are contrary to such resolution shall be ratified by the same pro-
cedure as the original resolution of intent.

      (c) If the project area identified by the resolution adopted by the
board requires the project area be expanded outside of the boundaries
of the college's campus, the governing body of the county in which such
property is located first shall approve the boundaries of the project area
after holding a public hearing. Prior to holding the public hearing, the
governing body shall adopt a resolution stating that such boundaries are
subject to approval. Such resolution shall: (1) Give notice that a public
hearing will be held to consider the proposed boundaries and fix the date,
hour and place of such public hearing; (2) describe the proposed bound-
aries; (3) describe a proposed project that identifies all of the proposed
area and that identifies in a general manner all of the buildings and fa-
cilities that are proposed to be constructed or improved in the project
area; and (4) state that the governing body will consider approving such
expansion beyond the campus boundaries.

      A copy of the resolution providing for the public hearing shall be de-
livered to the board of education of any school district levying taxes on
property within the proposed project area. The resolution shall be pub-
lished once in the official county newspaper not less than one week nor
more than two weeks preceding the date fixed for the public hearing. If
the resolution approving the boundaries of the project area is adopted by
the governing body of the county, no sales tax increment collected from
taxpayers doing business within the project area, but outside the bound-
aries of the college campus shall be pledged pursuant to section 3 as debt
service for payment of principle and interest on any bonds issued for the
project until it is first subject to a county-wide election and has received
the approval of a majority of the electors of the county voting thereon at
an election held pursuant to the notice, publication and other election
procedures prescribed by K.S.A. 12-187 and amendments thereto.

      (d) Any project may be undertaken in separate development phases.
Any project shall be completed on or before the final scheduled maturity
of the first series of bonds issued to finance the project.

      (e) Any moneys which represent the increment as defined by section
2, and amendments thereto, shall be apportioned to a special fund estab-
lished by the Kansas development finance authority for the payment of
the costs of the project, including the payment of principal and interest
on any bonds issued to finance such project pursuant to this act and may
be pledged to the payment of principal and interest on such bonds. The
maximum maturity of bonds issued to finance projects pursuant to this
act shall not exceed 30 years from the date of the issuance of the bonds
to finance the project.

      (f) Before any project is undertaken, the board shall enter into a con-
tract with the lowest responsible bidder among nationally recognized con-
sultants for the preparation of a comprehensive feasibility study. The
study shall include:

      (1) A determination of whether sufficient revenues may be pledged
to pay the debt service on bonds issued to finance the project;

      (2) an estimate of revenues likely to be realized through existing
sources of income which may be pledged to finance such bonds;

      (3) an identification of other sources of revenue which might be nec-
essary to be pledged to finance the bonds;

      (4) an identification of future economic trends which may affect the
feasibility of the project;

      (5) an identification of opportunity costs created by the project; and

      (6) any other considerations which may be relevant to determining
the feasibility of the project.

      New Sec.  3. (a) Any bonds issued by the authority under subsection
(f) of K.S.A. 74-8905, and amendments thereto, to finance the undertak-
ing of the project in accordance with the provisions of this act, shall be
made payable, both as to principal and interest:

      (1) from revenues of the college or the foundation derived from or
held in connection with the undertaking and carrying out of any rede-
velopment plan under this act;

      (2) from any private sources, contributions or other financial assis-
tance from the state or federal government;

      (3) from sales tax increments from any sales taxes collected within
the boundaries of the project area as described by the resolution of the
board of trustees; or

      (4) by any combination of these methods.

      (b) Such revenue may be pledged to the repayment of such bonds
prior to, simultaneously with or subsequent to the issuance of such bonds.

      (c) No funds derived from student tuition shall be used to pay the
principal or interest on bonds issued by the authority under subsection
(f) of K.S.A. 74-8905, and amendments thereto.

      New Sec.  4. (a) Until the date the bonds issued to finance the pro-
ject undertaken in the project area have been paid in full, any revenue
realized from sales tax from a countywide retailers' sales tax imposed and
collected under K.S.A. 1999 Supp. 12-187 and amendments thereto, the
state retailers' sales tax pursuant to K.S.A. 79-3603, and amendments
thereto which have been certified by the director of taxation to have been
derived from taxpayers located in the project area shall be remitted to
the state treasurer.

      (b) The state treasurer shall transfer all such revenues to the fund
established by the authority. The state treasurer shall make such distri-
butions on dates mutually agreed upon by the treasurer and the authority.
The authority shall use all such moneys received pursuant to this section
to pay the costs of the project. Any revenues not needed or committed
for the payment of bonds as determined by the authority may be remitted
by the state treasurer proportionately to the appropriate taxing subdivi-
sions.

     Sec.  5. K.S.A. 1999 Supp. 74-8905 and K.S.A. 1999 Supp. 74-8905a are
hereby repealed.

     Sec.  6. This act shall take effect and be in force from and after its
publication in the Kansas register.