CHAPTER 66 HOUSE BILL No. 2590* An Act concerning housing; providing for the creation of rural housing incentive districts
in such cities and counties; imposing certain requirements. Be it enacted by the Legislature of the State of Kansas:

Section 1. This act shall be known and may be cited as the Kansas
rural housing incentive district act.

Sec. 2. As used in the rural housing incentive district act:

(a) ``City'' means any city incorporated in accordance with Kansas law
with a population of less than 40,000 in a county with a population of less
than 60,000, as certified to the secretary of state by the director of the
division of the budget on the previous July 1st in accordance with K.S.A
11-201, and amendments thereto;

(b) ``County'' means any county organized in accordance with K.S.A.
18-101 et seq., and amendments thereto, with a population of less than
40,000, as certified to the secretary of state by the director of the division
of the budget on the previous July 1st in accordance with K.S.A 11-201,
and amendments thereto;

(c) ``Developer'' means the person, firm or corporation responsible
under an agreement with the governing body to develop housing or re-
lated public facilities in a district.

(d) ``District'' means a rural housing incentive district established in
accordance with this act.

(e) ``Governing body'' means the board of county commissioners of
any county or the mayor and council, mayor and commissioners or board
of commissioners, as the laws affecting the organization and status of cities
affected may provide;

(f) ``Secretary'' means the secretary of commerce and housing of the
state of Kansas.

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

(h) ``Taxing subdivision'' means the county, the city, the unified
school district, and any other taxing subdivision levying real property
taxes, the territory or jurisdiction of which includes any currently existing
or subsequently created rural housing incentive district.

Sec. 3. It is hereby declared to be the purpose of this act to encour-
age the development and renovation of housing in the rural cities and
counties of Kansas by authorizing cities and counties to assist directly in
the financing of public improvements that will support such housing in
rural areas of Kansas which experience a shortage of housing.

Sec. 4. (a) The governing body of any city or county is hereby au-
thorized to designate rural housing incentive districts within such city or
county. Any city governing body may designate one or more such districts
in such city, and any county governing body may designate one or more
such districts in any part of the unincorporated territory of such county.
Prior to making such a designation, the governing body shall conduct a
housing needs analysis to determine what, if any, housing needs exist
within its community. After conducting the analysis, the governing body
shall adopt a resolution containing a legal description of the proposed
district, a map depicting the existing parcels of real estate in the proposed
district, and a statement of the following findings and determinations:

(1) There is a shortage of quality housing of various price ranges in
the city or county despite the best efforts of public and private housing
developers;

(2) The shortage of quality housing can be expected to persist and
that additional financial incentives are necessary in order to encourage
the private sector to construct or renovate housing in such city or county;

(3) The shortage of quality housing is a substantial deterrent to the
future economic growth and development of such city or county; and

(4) The future economic well-being of the city or county depends on
the governing body providing additional incentives for the construction
or renovation of quality housing in such city or county.

(b) The resolution containing the findings contained in subsection (a)
shall be published at least once in the official newspaper of the city or
county.

(c) Upon publication of the resolution as provided in subsection (b),
the governing body shall send a certified copy of the resolution to the
secretary, requesting that the secretary review the resolution and advise
the governing body whether the secretary agrees with the findings con-
tained therein. If the secretary advises the governing body in writing that
the secretary agrees with each of the findings of the governing body, the
governing body may proceed to establish the district as set forth in this
act. If the secretary fails to agree with the findings, the secretary shall
advise the governing body in writing of the specific reasons therefor.

Sec. 5. (a) Upon receipt of the approval of the secretary as provided
in subsection (c) of new section 4, the governing body may proceed with
the establishment of the district. Before doing so, the governing body
shall adopt a plan for the development or redevelopment of housing and
public facilities in the proposed district. Such plan may include plans for
one or more projects, and the length of any individual project shall not
exceed 15 years. The plan shall include, but not be limited to, the follow-
ing:

(1) The legal description and map required by subsection (a) of new
section 4.

(2) The existing assessed valuation of the real estate in the proposed
district, listing the land and improvement values separately;

(3) A list of the names and addresses of the owners of record of all
real estate parcels within the proposed district;

(4) A description of the housing and public facilities project or pro-
jects that are proposed to be constructed or improved in the proposed
district, and the location thereof;

(5) A listing of the names, addresses and specific interests in real
estate in the proposed district of the developers responsible for devel-
opment of the housing and public facilities in the proposed district;

(6) The contractual assurances, if any, the governing body has re-
ceived from such developer or developers, guaranteeing the financial
feasibility of specific housing tax incentive projects in the proposed dis-
trict;

(7) A comprehensive analysis of the feasibility of providing housing
tax incentives in the district as provided in this act, which shows the public
benefits derived from such district will exceed the costs and that the
income therefrom, together with other sources of funding, will be suffi-
cient to pay for the public improvements that may be undertaken in such
district. If other sources of public or private funds are to be used to
finance the improvements, they shall be identified in the analysis.

(b) Prior to the adoption of the plan and designation of the district,
the governing body shall adopt a resolution stating that the governing
body is considering such action. The resolution shall provide notice that
a public hearing will held to consider the adoption of the plan and the
designation of the district and contain the following elements:

(1) The date, hour and place of the public hearing;

(2) The contents of paragraphs (1) through (4) in subsection (a) of
this section;

(3) A summary of the contractual assurances by the developer and
comprehensive feasibility analysis; and

(4) A statement that the plan is available for inspection at the office
of the clerk of the city or county at normal business hours;

(5) A statement inviting members of the public to review the plan
and attend the public hearing on the date announced in the resolution;

(c) The date fixed for the public hearing shall be not less than 30 nor
more than 70 days following the date of the adoption of the resolution.
The resolution shall be published at least once in the official newspaper
of the city or county, with the final publication being not less than one
week or more than two weeks preceding the date fixed for the public
hearing.

(d) A certified copy of the resolution shall be delivered to the plan-
ning commission of the city or county and the board of education of any
school district levying taxes on property within the proposed district. If
the resolution is adopted by a city governing body, a certified copy also
shall be delivered to the board of county commissioners of the county. If
the resolution is adopted by a county governing body, it also shall be
delivered to the governing body of any city located within three miles of
such proposed district.

Sec. 6. (a) At the public hearing, a representative of the city or county
shall present the proposed plan for the development or renovation of
housing in the proposed district. Each project proposed for the district
shall be identified and explained. At the hearing the developer or devel-
opers that have contracted with the city to undertake such project shall
be identified and present in person or through such developer's repre-
sentative. Following the presentation, all interested persons shall be given
an opportunity to be heard. The governing body for good cause shown
may recess such hearing to a time and date certain, which shall be fixed
in the presence of persons in attendance at the hearing.

(b) Upon the conclusion of the public hearing, the governing body
may adopt the plan for the district and may establish the district by or-
dinance or, in the case of any county, by resolution. The boundaries of
such district shall not include any area not designated in the notice re-
quired by New Section 5. Any addition of area to the district or any
substantial change to the plan shall be subject to the same procedure for
public notice and hearing as required for the initial establishment of the
district.

(c) The ordinance or resolution establishing the district shall be null
and void if, within 30 days following the conclusion of the hearing:

(1) the board of education levying taxes on such property determines
by resolution that the proposed district will have an adverse effect on
such school district;

(2) the governing body of any city located within three miles of dis-
trict proposed to be established by a county determines by ordinance that
the proposed district will have an adverse effect on such city; or

(3) The board of county commissioners of the county in which a city
governing body proposes to establish such a district.

Sec. 7. (a) Any governing body which has established a rural housing
incentive district as provided in this act may purchase or otherwise ac-
quire real property; however, the property may not be acquired through
the exercise of the power of eminent domain. Relocation assistance pay-
ments shall be provided by the city or county in accordance with the
provisions of K.S.A. 12-1777, and amendments thereto to any tenants
required to be relocated as a result of the acquisition of such property
for any project in the district.

(b) Any property acquired by a city or county under this act may be
sold or leased to any developer, in accordance with the rural housing
incentive plan and under such conditions as shall have been agreed to
prior to the adoption of the plan. The city or county and the developer
may agree to any additional terms and conditions, but if the developer
requests to be released from any obligations agreed to and embodied in
the plan, such release shall constitute a substantial change and subject to
the requirements provided in subsection (b) of new section 6.

Sec. 8. (a) (1) Any city or county which has established a housing
incentive district as provided in this act may issue special obligation bonds
to finance the implementation of the plan adopted for the district by the
governing body. Such special obligation bonds shall be made payable,
both as to principal and interest:

(A) From property tax increments allocated to, and paid into a special
fund of the city or county under the provisions of subsection (b) of new
section 10, and amendments thereto;

(B) from revenues of the city or county derived from or held in con-
nection with the implementation of the project or projects in the district;

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

(D) from any financial sureties or other guarantees provided by the
developer;

(E) from a pledge of any other lawfully available city or county rev-
enue sources, including, but not limited to: (I) a portion of all increased
franchise fees collected from utilities and other businesses using public
rights-of-way within the district; or (2) a portion of the sales and use tax
revenues received by the city or county and collected pursuant to K.S.A.
12-187, and amendments thereto; or

(F) by any combination of these methods.

The city or county may pledge such revenue to the repayment of such
special obligations bonds prior to, simultaneously with, or subsequent to
the issuance of such special obligation bonds.

(2) Bonds issued under this subsection shall not be general obliga-
tions of the city or county, not in any event shall they give rise to a charge
against the general credit or taxing powers of the city or county, or be
payable out of any funds or properties other than any of those set forth
in this subsection. Such bonds shall so state on their face.

(3) The bonds issued under the provisions of this subsection shall be
special obligations of the city or county and are declared to be negotiable
instruments. The bonds shall be executed by the mayor and clerk of the
city or, in the case of counties, by the chairman of the board of county
commissioners and clerk of the county, and shall be sealed with the cor-
porate seal of the city or the seal of the county. All details pertaining to
the issuance of such special obligation bonds shall be determined by or-
dinance of the city or resolution of the county. All special obligation bonds
issued pursuant to this act shall be exempt from all state taxes except
inheritance taxes. The special obligation bonds shall contain none of the
recitals set forth in K.S.A. 10-112, and amendments thereto. The special
obligation bonds shall contain the following recitals, viz., the authority
under which such special obligation bonds are issued, they are in con-
formity with the provisions, restrictions and limitations thereof, and that
such special obligation bonds and the interest thereon are to be paid from
the money and revenue received as provided in paragraph (1) of this
subsection.

(4) The maximum maturity on bonds issued to finance projects pur-
suant to this act shall not exceed 15 years.

(5) Any city or county issuing special obligation bonds under the pro-
visions of this act may refund all or part of such issue pursuant to the
provisions of K.S.A. 10-116a, and amendments thereto.

(b) In the event the city or county shall default in the payment of any
special obligation bonds as authorized pursuant to paragraph (1) of sub-
section (a) of this section, and amendments thereto, no public funds shall
be used to pay the holders thereof except as otherwise specifically au-
thorized in this act.

(c) Any and all terms, conditions, exclusions and limitations which are
otherwise applicable to bonds issued by authority of K.S.A. 12-1774, shall
also be applicable to bonds issued pursuant to this section.

Sec. 9. (a) Any city or county which has established a rural housing
incentive district may use the proceeds of special obligation bonds issued
under new section 8, and amendments thereto, or any uncommitted funds
derived from those sources of revenue set forth in paragraph (1) of sub-
section (a) of new section 8, to implement specific projects identified
within the rural housing incentive district plan including, without limi-
tation:

(1) Acquisition of property within the specific project area or areas
as provided in new section 7;

(2) payment of relocation assistance;

(3) site preparation;

(4) sanitary and storm sewers and lift stations;

(5) drainage conduits, channels and levees;

(6) street grading, paving, graveling, macadamizing, curbing, gutter-
ing and surfacing;

(7) street lighting fixtures, connection and facilities;

(8) underground gas, water, heating, and electrical services and con-
nections located within the public right-of-way;

(9) sidewalks; and

(10) water mains and extensions.

(b) None of the proceeds from the sale of special obligation bonds
issued under new section 8 shall be used for the construction of buildings
or other structures to be owned by or to be leased to any developer of a
residential housing project within the district.

Sec. 10. (a) All taxable tangible property located within a district es-
tablished in accordance with this act shall be assessed and taxed for ad
valorem tax purposes pursuant to law in the same manner that such prop-
erty 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 trea-
surer shall distribute such taxes as may be collected in the same manner
as if such property were located outside the district. Each district estab-
lished under the provisions of this act shall constitute a separate taxing
unit for the purpose of the computation and levy of taxes.

(b) Beginning with the first payment of taxes which are levied follow-
ing the date of the approval of any district in accordance with this act,
and amendments thereto, real property taxes received by the county trea-
surer resulting from taxes which are levied subject to the provisions of
this act by and for the benefit of a taxing subdivision on property located
within such district constituting a separate taxing unit under the provi-
sions 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 taxing subdivisions upon property located within a
district constituting a separate taxing unit under the provisions of this act,
the county treasurer first shall allocate and pay to each such taxing sub-
division 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 establishment of the district.

(2) Any real property taxes produced from that portion of the current
assessed valuation of real property within a district and constituting 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 shall be allocated and
paid by the county treasurer to the treasurer as follows:

(A) In districts established by a city, the amount shall be paid to the
treasurer of the city and deposited in a special fund of the city to pay the
cost of housing projects in the district including the payment of principal
of and interest on any special obligation bonds issued by such city to
finance, in whole or in part, such housing project.

(B) In districts established by a county, the amount shall be deposited
by the county treasurer in a special fund of the county to pay the cost of
housing projects in the district including the payment of principal of and
interest on any special obligation bonds issued by such county to finance,
in whole or in part, such housing project. If such special obligation bonds
and interest thereon have been paid before the completion of a project,
the city or county may continue to use such moneys for any purpose
authorized by this act until such time as the project is completed, but for
not to exceed 15 years from the date of the establishment of the district.
When such special obligation bonds and interest thereon have been paid
and the project is completed, all moneys thereafter received from real
property taxes within such district shall be allocated and paid to the re-
spective taxing subdivisions in the same manner as are other ad valorem
taxes.

(c) Notwithstanding any other provision of law, it is hereby stated
that is an object of all ad valorem taxes levied by or for the benefit of any
taxing subdivision on taxable tangible real property located within any
district created pursuant to this act, that such taxes may be applied and
allocated to and when collected paid into a special fund of a city or county
pursuant to the procedures and limitations of this act to pay the cost of
a project including principal of and interest on special obligation bonds
issued by such city or county to finance, in whole or in part, such project.

Sec. 11. (a) After the adoption by the governing body of a plan which
contains the provisions required by new section 5, the clerk of the city or
county shall transmit a copy of the description of the land within the
district, a copy of the ordinance or resolution adopting the plan and a
map or plat indicating the boundaries of the district, to the clerk, appraiser
and treasurer of the county in which the district is located and to the
governing bodies of any taxing subdivision which levy taxes upon any
property in the district. Such documents shall be transmitted as promptly
as practicable following the adoption or modification of the plan, but in
any event, on or before the January 1st next following the adoption or
modification of the plan.

(b) The appraiser of any county in which a district is authorized by a
city or county shall certify the amount of such increase in assessed valu-
ation of real and personal property within the district to the county clerk
on or before July 1 of each year.

Sec. 12. Sections 12 through 16 of this act shall be known and may
be cited as the smoke detector act.

Sec. 13. When used in this act:

(a) ``Dwelling unit'' means a single-family residence, multiple-family
residence and each living unit in a mixed-use building.

(b) ``Smoke detector'' means a device or combination of devices
which operate from a power supply in the dwelling unit or at the point
of installation for the purpose of detecting visible or invisible particles of
combustion. Such term shall include smoke detectors approved or listed
for the purpose for which they are intended by an approved independent
testing laboratory.

Sec. 14. (a) Every single-family residence shall have at least one
smoke detector on every story of the dwelling unit.

(b) Every structure which:

(1) Contains more than one dwelling unit; or

(2) contains at least one dwelling unit and is a mixed-use structure,
shall contain at least one smoke detector at the uppermost ceiling of each
interior stairwell and on every story in each dwelling unit.

(c) The owner of a structure shall supply and install all required
smoke detectors. The owner of a structure shall test and maintain all
smoke detectors except inside rental units, the occupant shall test and
maintain all smoke detectors after taking possession of the dwelling unit.

(d) The smoke detectors required in dwelling units in existence on
January 1, 1999, may either be battery-powered or wired into the struc-
ture's electrical system, and need not be interconnected. The smoke de-
tectors required in dwelling units constructed after January 1, 1999, shall
be wired permanently into the structure's electrical system.

(e) For purposes of this act, manufactured homes as defined in K.S.A.
58-4202, and amendments thereto, shall be subject to the federal, man-
ufactured home construction and safety standards established pursuant
to 42 U.S.C. § 5403 in lieu of the standards set forth herein. Owners and
occupants of such manufactured homes shall be subject to the testing and
maintenance standards for smoke detectors required under this act.

(f) Officials responsible for the enforcement of the smoke detector
act shall not enter a dwelling unit solely for the purpose of determining
compliance with the provisions of the smoke detector act except when:

(1) Conducting an inspection prior to the issuance of an occupancy
permit or building permit;

(2) responding to a report of a fire in a dwelling unit, except in cases
of a false alarm; or

(3) conducting, at the request of the owner or occupant, a home
safety inspection.

(g) Evidence of the failure of any property owner to provide an op-
erational smoke detector in a residence as required by this section shall
not be admissible in any action for the purpose of determining any aspect
of civil liability.

Evidence of the failure of any occupant to properly maintain a smoke
detector as required by this section shall not be admissible in any action
for the purpose of determining any aspect of civil liability.

(h) The provisions of the smoke detector act shall not constitute
grounds for the purpose of offsetting, reducing or denying the payment
of amounts due under any contract for or policy of insurance.

Sec. 15. Failure to place or maintain a smoke detector as provided
by the smoke detector act shall be a nonclass nonperson misdemeanor.
Any fine imposed for a violation of this section shall not exceed $25.

Sec. 16. This law shall be in addition to any county resolution or city
ordinance relating to regulation of smoke detectors.

Sec. 17. This act shall take effect and be in force from and after its
publication in the statute book.

Approved April 8, 1998

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