CHAPTER 169 HOUSE BILL No. 3036 (Amends Chapters 17 and 110) (Amended by Chapter 199)
      An Act concerning municipalities; relating to special revenue bonds; amending K.S.A. 1997
      Supp. 12-1771, as amended by section 2 of 1998 House Bill No. 2631 and 12-1775, as
      amended by section 4 of 1998 House Bill No. 2631, and repealing the existing sections;
      also repealing K.S.A. 1997 Supp. 12-1771, as amended by section 1 of 1998 Senate Bill
      No. 672 and 12-1775, as amended by section 2 of 1998 Senate Bill No. 672.

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

Section 1. K.S.A. 1997 Supp. 12-1771, as amended by section 2 of
1998 House Bill No. 2631, is hereby amended to read as follows: 12-1771.
(a) No city shall exercise any of the powers conferred by K.S.A. 12-1770
et seq., and amendments thereto, unless the governing body of such city
has adopted a resolution finding that the specific project area sought to
be redeveloped is a blighted area, a conservation area, a major tourism
area as defined in K.S.A. 12-1774, and amendments thereto, or was des-
ignated prior to July 1, 1992, as an enterprise zone pursuant to K.S.A. 12-
17,110 prior to its repeal, and the conservation, development or redevel-
opment of such area is necessary to promote the general and economic
welfare of such city. Enterprise zones designated prior to July 1, 1992,
may be enlarged by the city to an area not exceeding 25% of the city's
land area upon a finding by the secretary of the department of commerce
and housing that a redevelopment project proposed by the city which
requires the enlargement is of statewide importance and that it will meet
the criteria specified in subsection (a)(1)(D) of K.S.A. 12-1774, and
amendments thereto. For the purpose of this subsection, the term
``blighted area'' means an area which: (1) Because of the presence of a
majority of the following factors, substantially impairs or arrests the sound
development and growth of the municipality or constitutes an economic
or social liability or is a menace to the public health, safety, morals or
welfare in its present condition and use: (A) A substantial number of
deteriorated or deteriorating structures; (B) predominance of defective
or inadequate street layout; (C) unsanitary or unsafe conditions; (D) de-
terioration of site improvements; (E) diversity of ownership; (F) tax or
special assessment delinquency exceeding the fair value of the land; (G)
defective or unusual conditions of title; (H) improper subdivision or ob-
solete platting or land uses; (I) the existence of conditions which endanger
life or property by fire and other causes; or (J) conditions which create
economic obsolescence; or (2) has been identified by any state or federal
environmental agency as being environmentally contaminated to an ex-
tent that requires a remedial investigation, feasibility study and remedi-
ation or other similar state or federal action; or (3) previously was found
by resolution of the governing body to be a slum or a blighted area under
K.S.A. 17-4742 et seq., and amendments thereto.

For the purpose of this subsection, conservation area means any im-
proved area within the corporate limits of a city in which 50% or more
of the structures in the area have an age of 35 years or more, which area
is not yet blighted, but may become a blighted area due to the existence
of a combination of two or more of the following factors: (i) Dilapidation,
obsolescence or deterioration of the structures; (ii) illegal use of individual
structures; (iii) the presence of structures below minimum code stan-
dards; (iv) building abandonment; (v) excessive vacancies; (vi) overcrowd-
ing of structures and community facilities; or (vii) inadequate utilities and
infrastructure. Not more than 15% of the land area of a city may be found
to be a conservation area.

(b) The powers conferred upon cities under the provisions of K.S.A.
12-1770 et seq., and amendments thereto, shall be exercised by cities, as
determined by resolution adopted pursuant to K.S.A. 12-1772, and
amendments thereto, (1) in enterprise zones designated prior to July 1,
1992, including any area added to such enterprise zone after July 1, 1992,
pursuant to subsection (a), (2) in blighted areas of cities and counties
described by subsection (a)(2), (3) in conservation areas of cities, (4) in
major tourism areas as defined in K.S.A. 12-1774 and amendments
thereto or (5) in blighted areas of cities, as determined by resolution
adopted pursuant to K.S.A. 17-4742 et seq., and amendments thereto.

(c) Within that portion of the city described in subsection (b), the
governing body of a city may establish a district to be known as a ``rede-
velopment district''. Within that portion of a city and county described in
subsection (b) excluding paragraph (3) of subsection (b), the governing
body of the city, upon written consent of the board of county commis-
sioners, may establish a district inclusive of land outside the boundaries
of the city to be known as a redevelopment district. In all such cases, the
board of county commissioners, prior to providing written consent, shall
be subject to the same procedure for public notice and hearing as is
required of a city pursuant to subsection (d) for the establishment of a
redevelopment district. One or more redevelopment projects may be un-
dertaken by a city within a redevelopment district after such redevelop-
ment district has been established in the manner provided by subsection
(d).

(d) Any city proposing to establish a redevelopment district shall
adopt a resolution stating that the city is considering the establishment
of a redevelopment district. Such resolution shall:

(1) Give notice that a public hearing will be held to consider the
establishment of a redevelopment district and fix the date, hour and place
of such public hearing;

(2) describe the proposed boundaries of the redevelopment district;

(3) describe a proposed comprehensive plan that identifies all of the
proposed redevelopment project areas and that identifies in a general
manner all of the buildings and facilities that are proposed to be con-
structed or improved in each redevelopment project area;

(4) state that a description and map of the proposed redevelopment
district are available for inspection at a time and place designated;

(5) state that the governing body will consider findings necessary for
the establishment of a redevelopment district.

Notice shall be given as provided in subsection (c) of K.S.A. 12-1772,
and amendments thereto.

(e) Upon the conclusion of the public hearing, the governing body
may adopt a resolution to make any findings required by subsection (a)
and may establish the redevelopment district by ordinance. Such reso-
lution shall contain a comprehensive plan that identifies all of the pro-
posed redevelopment project areas and identifies in a general manner all
of the buildings and facilities that are proposed to be constructed or im-
proved in each redevelopment project area. The boundaries of such dis-
trict shall not include any area not designated in the notice required by
subsection (d). Subject to the provisions of section 4 of 1998 Senate Bill
No. 672, and amendments thereto, any addition of area to the redevel-
opment district or any substantial change to the comprehensive plan shall
be subject to the same procedure for public notice and hearing as is
required for the establishment of the district. The boundaries of any such
district in a major tourism area including an auto race track facility located
in Wyandotte county, shall, without regard to that portion of the district
pertaining to the auto race track facility, be 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.

(f) No privately owned property subject to ad valorem taxes shall be
acquired and redeveloped under the provisions of K.S.A. 12-1770 et seq.,
and amendments thereto, if the board of county commissioners or the
board of education levying taxes on such property determines by reso-
lution adopted within 30 days following the conclusion of the hearing for
the establishment of the redevelopment district required by subsection
(d) that the proposed redevelopment district will have an adverse effect
on such county or school district.

(g) Any redevelopment plan undertaken within the redevelopment
district may be in separate development stages. Each plan shall be
adopted according to the provisions of K.S.A. 12-1772, and amendments
thereto, and shall fix a date for completion. Except as provided herein,
any project shall be completed within 20 years from the date of the es-
tablishment of the redevelopment district of transmittal of the redevel-
opment plan or a revision of the plan, as authorized by section 4 of 1998
Senate Bill No. 672, and amendments thereto, to the county pursuant to
K.S.A. 12-1776, and amendments thereto. Projects relating to environ-
mental investigation and remediation under subsection (i) shall be com-
pleted within 20 years from the date a city enters into a consent decree
agreement with the Kansas department of health and environment or the
United States environmental protection agency. A redevelopment project
in a major tourism area for an auto race track facility described in sub-
section (a)(1)(D) of K.S.A. 12-1774, and amendments thereto, shall be
completed within 30 years from the date the secretary of commerce and
housing makes the finding that the redevelopment project will create a
major tourism area pursuant to subsection (a)(1)(D) of K.S.A. 12-1774,
and amendments thereto.

(h) Any increment in ad valorem property taxes resulting from a re-
development district undertaken in accordance with the provisions of this
act, shall be apportioned to a special fund for the payment of the cost of
the redevelopment project, including the payment of principal and inter-
est on any special obligation bonds or full faith and credit tax increment
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 on bonds issued to finance projects pursuant to this
act shall not exceed 20 years except that: (1) Such maximum period of
special obligation bonds not payable from revenues described by subsec-
tion (a)(1)(D) of K.S.A. 12-1774, and amendments thereto, issued to fi-
nance an auto race track facility shall not exceed 30 years; and (2) such
maximum period, if the governor determines and makes and submits a
finding to the speaker of the house of representatives and the president
of the senate that a maturity greater than 20 years, but in no event ex-
ceeding 30 years, is necessary for the economic feasibility of the financing
of an auto race track facility with special obligation bonds payable pri-
marily from revenues described by subsection (a)(1)(D) of K.S.A. 12-
1774, and amendments thereto, may be extended in accordance with such
determination and finding.

For the purposes of this act, ``increment'' means that amount of ad
valorem taxes collected from real property located within the redevel-
opment district that is in excess of the amount which is produced from
such property and attributable to the assessed valuation of such property
prior to the date the redevelopment district was established, as deter-
mined under the provisions of K.S.A. 12-1775 plan or revision of the plan,
as authorized by section 4 of 1998 Senate Bill No. 672, and amendments
thereto, is transmitted to the county pursuant to K.S.A. 12-1776, and
amendments thereto.

(i) The governing body of a city, in contracts entered into with the
Kansas department of health and environment or the United States en-
vironmental protection agency, may pledge increments receivable in fu-
ture years to pay costs directly relating to the investigation and remedi-
ation of environmentally contaminated areas. The provisions in such
contracts pertaining to pledging increments in future years shall not be
subject to K.S.A. 10-1101 et seq. or 79-2925 et seq., and amendments
thereto.

(j) Before any redevelopment project is undertaken, a comprehensive
feasibility study, which shows the benefits derived from such project will
exceed the costs and that the income therefrom will be sufficient to pay
for the project shall be prepared. Such feasibility study shall be an open
public record.

(k) If a city determines that revenues from sources other than prop-
erty taxes will be sufficient to pay any special obligation bonds issued to
finance a redevelopment project for an auto race track facility described
in subsection (a)(1)(D) of K.S.A. 12-1774, and amendments thereto,
which the secretary of commerce and housing makes a finding that such
project will create a major tourism area pursuant to subsection (a)(1)(D)
of K.S.A. 12-1774, and amendments thereto, all property, both real and
personal property, constituting an auto race track facility described in
subsection (a)(1)(D) of K.S.A. 12-1774, and amendments thereto, in such
redevelopment district shall be exempt from property taxation for a pe-
riod ending on the earlier of (1) the date which is 30 years after the date
of the finding by the secretary of commerce and housing with respect to
such major tourism area; or (2) the date on which no such special obli-
gation bonds issued to finance such auto race track facility in a major
tourism area remain outstanding.

(l) Any major tourism area may include an additional area not ex-
ceeding 400 acres of additional property, excluding roads and highways,
in addition to the property necessary for the auto race track facility upon
a finding by the governor that the development plan and each project
within such additional area will enhance the major tourism area. For the
development of each project within such additional area the city shall
select qualified developers pursuant to a request for proposals in accord-
ance with written official procedures approved by the governing body of
the city. Any project within such additional area that is financed in whole
or in part by special obligation bonds payable form revenues derived from
subsection (a)(1)(D) of K.S.A. 12-1774, and amendments thereto, shall
not be entitled to any real property tax abatements or the revenues de-
scribed in K.S.A. 12-1775, and amendments thereto. Any project within
such additional area must be approved by the governor and construction
must be commenced by July 1, 2002. The city shall prepare and submit
annually to the governor, the secretary of commerce and housing and the
legislature by each October 1, commencing October 1, 1999 and contin-
uing until October 1, 2002, a report describing the status of any projects
within such additional area. Any business located in Kansas within 50
miles of a major tourism area that relocates into a major tourism area
shall not receive any of the benefits of K.S.A. 12-1770 et seq., and amend-
ments thereto.

Sec. 2. K.S.A. 1997 Supp. 12-1775, as amended by section 4 of 1998
House Bill No. 2631, is hereby amended to read as follows: 12-1775. (a)
For the purposes of this act, the term:

(1) ``Taxing subdivision'' shall include means the county, the city, the
unified school district and any other taxing subdivision levying real prop-
erty taxes, the territory or jurisdiction of which includes any currently
existing or subsequently created redevelopment district. The term; and

(2) ``real property taxes'' includes means all taxes levied on an ad
valorem basis upon land and improvements thereon.

(b) Except for redevelopment projects satisfying the conditions of
subsection (k) of K.S.A. 12-1771 hereof , and amendments thereto, all
tangible taxable property located within a redevelopment district shall be
assessed and taxed for ad valorem tax purposes pursuant to law in the
same manner that such property would be assessed and taxed if located
outside such district, and all ad valorem taxes levied on such property
shall be paid to and collected by the county treasurer in the same manner
as other taxes are paid and collected. Except as otherwise provided in this
section, the county treasurer shall distribute such taxes as may be col-
lected in the same manner as if such property were located outside a
redevelopment district. Each redevelopment district established under
the provisions of this act shall constitute a separate taxing unit for the
purpose of the computation and levy of taxes.

(c) Except for redevelopment projects satisfying the conditions of
subsection (k) of K.S.A. 12-1771 hereof, and amendments thereto, begin-
ning with the first payment of taxes which are levied following the date
of approval of any redevelopment district established the redevelopment
plan or revision of the plan, as authorized by section 4 of 1998 Senate
Bill No. 672, and amendments thereto, to the county pursuant to K.S.A.
12-1771 12-1776, and amendments thereto, real property taxes received
by the county treasurer resulting from taxes which are levied subject to
the provisions of this act by and for the benefit of a taxing subdivision, as
herein defined, on property located within such redevelopment district
constituting a separate taxing unit under the provisions of this section,
shall be divided as follows:

(1) From the taxes levied each year subject to the provisions of this
act by or for each of the taxing subdivisions upon property located within
a redevelopment district constituting a separate taxing unit under the
provisions of this act, the county treasurer first shall allocate and pay to
each such taxing subdivision all of the real property taxes collected which
are produced from that portion of the current assessed valuation of such
real property located within such separate taxing unit which is equal to
the total assessed value of such real property on the date of the estab-
lishment of the redevelopment district.

(2) Any real property taxes produced from that portion of the current
assessed valuation of real property within the redevelopment district con-
stituting a separate taxing unit under the provisions of this section in
excess of an amount equal to the total assessed value of such real property
on the effective date of the establishment of the district January 1 in the
year preceding transmittal of the redevelopment plan or a revision of the
plan, as authorized by section 4 of 1998 Senate Bill No. 672, and amend-
ments thereto, to the county pursuant to K.S.A. 12-1776, and amendments
thereto, shall be allocated and paid by the county treasurer to the trea-
surer of the city and deposited in a special fund of the city to pay the cost
of redevelopment projects including the payment of principal of and in-
terest on any special obligation bonds or full faith and credit tax increment
bonds issued by such city to finance, in whole or in part, such redevel-
opment project. When such obligation bonds and interest thereon have
been paid, all moneys thereafter received from real property taxes within
such redevelopment district shall be allocated and paid to the respective
taxing subdivisions in the same manner as are other ad valorem taxes. If
such obligation bonds and interest thereon have been paid before the
completion of a project, the city may continue to use such moneys for
any purpose authorized by this act until such time as the project is com-
pleted, but for not to exceed 20 years from the date of the establishment
of the redevelopment district transmittal to the county of the redevelop-
ment plan or a revision of the plan as authorized by section 4 of 1998
Senate Bill No. 672, and amendments thereto.

(d) In any redevelopment plan or in the proceedings for the issuing
of any special obligation bonds or full faith and credit tax increment bonds
by the city to finance a redevelopment project, the property tax increment
portion of taxes provided for in paragraph (2) of subsection (c) may be
irrevocably pledged for the payment of the principal of and interest on
such obligation bonds, subject to the provisions of subsection (h) of K.S.A.
12-1771, and amendments thereto. A city may adopt a redevelopment
plan in which only a specified percentage of the tax increment realized
from taxpayers in the redevelopment district are pledged to the redevel-
opment project. The county treasurer shall allocate the specified per-
centage of the tax increment to the treasurer of the city for deposit in the
special fund of the city to finance the cost of redevelopment projects if
the city has other available revenues and pledges the revenues to the
redevelopment project in lieu of the tax increment. Any portion of such
tax increment not allocated to the city for the redevelopment project shall
be allocated and paid in the same manner as other ad valorem taxes.

Sec. 3. K.S.A. 1997 Supp. 12-1771, as amended by section 2 of 1998
House Bill No. 2631, 12-1771, as amended by section 1 of 1998 Senate
Bill No. 672, 12-1775, as amended by section 4 of 1998 House Bill No.
2631, and 12-1775, as amended by section 2 of 1998 Senate Bill No. 672,
are hereby repealed.

Sec. 4. This act shall take effect and be in force from and after its
publication in the Kansas register.

Approved May 13, 1998

Published in the Kansas Registers May 21, 1998

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