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AN ACT concerning economic development programs; relating to re-
  coupment of economic development benefits; amending K.S.A. 1996
  Supp. 12-1742, 74-5066, 74-50,105, 74-5089, 74-50,115, 74-50,131,
  74-50,144, 74-50,151 and 79-32,153 and repealing the existing
  sections.
Be it enacted by the Legislature of the State of Kansas:
  New Section 1.  The board of county commissioners of any county or
governing body of any city proposing to grant an exemption for the prop-
erty of any business pursuant to section 13 of article 11 of the Kansas
constitution is hereby authorized to provide in an agreement between the
county or city and such business provisions for reimbursement by the
business of any actual costs incurred by the county or city and for payment
of the property taxes of the various taxing subdivisions that would have
been levied upon the property had it not been exempted if such business
fails to meet any of the terms and conditions established by the county
or city for the granting of the exemption.  The county treasurer shall ap-
portion any property taxes paid pursuant to such agreement among the
taxing subdivisions of this state in the territory in which the facility is
located. Such tax payments shall be divided by the county treasurer
among such taxing subdivisions in the same proportion that the amount
of the total mill levy of each individual taxing subdivision bears to the
aggregate of such levies of all of the taxing subdivisions among which the
division is to be made. The county treasurer shall pay such amounts to
the taxing subdivisions at the same time or times as their regular operating
tax rate mill levy is paid to such taxing subdivisions.
  Sec. 2.  K.S.A. 1996 Supp. 12-1742 is hereby amended to read as
follows: 12-1742. Such agreements shall provide for a rental sufficient to
repay the principal of and the interest on the revenue bonds. Such agree-
ments also may provide that the lessee shall reimburse the city or county
for its actual costs of administering and supervising the issue. The city or
county may charge an origination fee. Such fee shall not be deemed a
payment in lieu of taxes hereunder. Such fee shall be used exclusively for
local economic development activities but shall not be used to pay any
HB 2448
                                     

 1  administrative costs of the city or county. Except for the origination fee,
 2  all other fees paid in excess of such actual costs and any other obligation
 3  assumed under the contract shall be deemed payments in lieu of taxes
 4  and distributed as provided herein. If the lessee fails to meet any of the
 5  terms and conditions established by the city or county for the issuance of
 6  the revenue bonds, the agreement may provide for reimbursement by the
 7  lessee of the city or county for any actual costs incurred thereby and for
 8  payment of the property taxes of the various taxing subdivisions that
 9  would have been levied upon the property had it not been exempted pur-
10  suant to K.S.A. 79-201a and amendments thereto. If the agreement pro-
11  vides for a payment in lieu of taxes to the city or county, such payment,
12  immediately upon receipt of same, shall be transmitted by the city or
13  county to the county treasurer of the county in which the city is located.
14  Payments in lieu of taxes received pursuant to agreements entered into
15  after the effective date of this act shall include all fees or charges paid
16  for services normally and customarily paid from the proceeds of general
17  property tax levies, except for extraordinary services provided for the fa-
18  cility or an extraordinary level of services required by a facility. Payments
19  in lieu of taxes may be required only upon property for which an exemp-
20  tion from ad valorem property taxes has been granted by the state board
21  of tax appeals. The county treasurer shall apportion such payment among
22  the taxing subdivisions of this state in the territory in which the facility is
23  located. Any payment in lieu of taxes shall be divided by the county treas-
24  urer among such taxing subdivisions in the same proportion that the
25  amount of the total mill levy of each individual taxing subdivision bears
26  to the aggregate of such levies of all the taxing subdivisions among which
27  the division is to be made. The county treasurer shall pay such amounts
28  to the taxing subdivisions at the same time or times as their regular op-
29  erating tax rate mill levy is paid to them. Based upon the assessed valu-
30  ation which such facility would have if it were upon the tax rolls of the
31  county, the county clerk shall compute the total of the property taxes
32  which would be levied upon such facility by all taxing subdivisions within
33  which the facility is located if such property were taxable.
34    Sec. 3.  K.S.A. 1996 Supp. 74-5066 is hereby amended to read as
35  follows: 74-5066. (a) The secretary shall administer the KIT program and
36  the KIR program and shall:
37    (1)  Consider proposals from industries and job training agencies for
38  training or retraining services under the programs;
39    (2)  publicize the programs and the procedures for making and sub-
40  mitting proposals for participation therein;
41    (3)  establish standards and criteria for consideration of proposals and
42  for assigning priorities among industries making proposals;
43    (4)  ensure the provision of adequate fiscal and accounting controls
HB 2448
                                     

 1  under the programs;
 2    (5)  allocate and distribute funds made available for administration of
 3  the programs;
 4    (6)  evaluate the programs each year and make a report on the per-
 5  formance and cost effectiveness thereof as a part of the annual report
 6  required by K.S.A. 1996 Supp. 74-5049, and amendments thereto; and
 7    (7)  adopt rules and regulations necessary for administration of the
 8  programs.
 9    (b)  Contractual agreements may be entered into by the secretary with
10  any industry or job training agency for participation in the programs and
11  such agreements may be in the form of fixed-fee performance contracts.
12  Such contracts must contain a provision in which the employer agrees in
13  writing to reimburse the state for any funds awarded under this section
14  if the employer moves all or a significant portion of such employer's busi-
15  ness operations to another state within 10 years after receiving such grant.
16  Any payment required to be made by an employer shall be a lien upon
17  the employer's business property until paid and has equal precedence with
18  ordinary taxes and shall not be divested by a judicial sale. Property subject
19  to the lien may be sold for sums due and delinquent at a tax sale, with
20  the same forfeitures, penalties and consequences as for the nonpayment
21  of ordinary taxes. The purchasers at tax sale obtain the property subject
22  to the remaining payments. Training services under the KIT program may
23  be provided at no cost to the industry or on a shared-cost basis with the
24  industry as determined through negotiation between the secretary and
25  the industry. Retraining services under the KIR program shall be pro-
26  vided on a shared cost basis. All expenditures for the payment of costs
27  under the KIT and KIR programs shall be made in accordance with ap-
28  propriation acts upon warrants of the director of accounts and reports
29  issued pursuant to vouchers approved by the secretary or by a person or
30  persons designated by the secretary. Notwithstanding any provision of
31  law to the contrary, contractual agreements entered into under the KIT
32  program or the KIR program shall not be subject to competitive bidding
33  procedures of K.S.A. 75-3739 and amendments thereto.
34    (c)  Within the limitation of funds available for the KIT and KIR pro-
35  grams and to the extent practicable, the secretary shall make participation
36  in the programs available to all industries which submit proposals to par-
37  ticipate therein, if consistent with program goals and objectives and the
38  allocation of resources for the programs. Goals and objectives for the KIT
39  and KIR programs shall include appropriate priorities for basic industries.
40    Sec. 4.  K.S.A. 1996 Supp. 74-5089 is hereby amended to read as
41  follows: 74-5089. (a) There is hereby established a state matching grant
42  program to provide assistance in the promotion of tourism and develop-
43  ment of quality tourist attractions within the state of Kansas. Grants
HB 2448
                                     

 1  awarded under this program shall be limited to not more than 40% of
 2  the cost of any proposed project. Applicants shall not utilize any state
 3  moneys to meet the matching requirements under the provisions of this
 4  program. Both public and private entities shall be eligible to apply for a
 5  grant under the provisions of this act. Not less than 75% of all moneys
 6  granted under this program shall be allocated to public entities or entities
 7  exempt from taxation under the provisions of 501(c)(3) of the federal
 8  internal revenue code of 1986 and amendments thereto.  After July 1,
 9  1994, no more than 20% of moneys granted to public or nonprofit entities
10  shall be granted to any single such entity. Furthermore, after July 1, 1994,
11  no more than 20% of moneys granted to private entities shall be granted
12  to any single such entity. The secretary of commerce and housing shall
13  administer the provisions of this act and the secretary may adopt rules
14  and regulations establishing criteria for qualification for a matching grant
15  and such other matters deemed necessary by the secretary for the ad-
16  ministration of this act.
17    (b)  Prior to receiving any grant awarded under this section, an ap-
18  plicant, which is a private entity, must agree in writing to reimburse the
19  state for any funds awarded under this section if the applicant moves all
20  or a significant portion of its business operations to another state within
21  10 years after recruiting such grant. Any payment required to be made
22  by an applicant shall be a lien upon the applicant's business property
23  until paid and has equal precedence with ordinary taxes and shall not be
24  divested by a judicial sale. Property subject to the lien may be sold for
25  sums due and delinquent at a tax sale, with the same forfeitures, penalties
26  and consequences as for the nonpayment of ordinary taxes. The purchas-
27  ers at tax sale obtain the property subject to the remaining payments.
28    (b) (c)  For the purpose of K.S.A. 74-5089 through 74-5091, and
29  amendments thereto, ``tourist attraction'' means a site that is of significant
30  interest to tourists as a historic, cultural, scientific, educational, recrea-
31  tional or architecturally unique site, or as a site of natural scenic beauty
32  or an area naturally suited for outdoor recreation, however, under no
33  circumstances shall ``tourist attraction'' mean a race track facility, as de-
34  fined in K.S.A. 74-8802, and amendments thereto, or any casino or other
35  establishment which operates class three games, as defined in the 1991
36  version of 25 USC 2703.
37    (c) (d)  During the fiscal year 1997, Kansas Inc. shall commission an
38  analysis of this program's impact on tourism. The analysis shall include a
39  recommendation for continuation, discontinuation or alteration of the
40  program.
41    Sec. 5.  K.S.A. 1996 Supp. 74-50,105 is hereby amended to read as
42  follows: 74-50,105. (a) Subject to the approval of the secretary of com-
43  merce and housing, an educational institution may enter into an agree-
HB 2448
                                     

 1  ment to establish a project and provide program services to an employer.
 2  As soon as possible after initial contact between an educational institution
 3  and an employer regarding the possibility of entering into an agreement,
 4  the educational institution shall inform the secretary of commerce and
 5  housing about the potential project. If an agreement is entered into, the
 6  educational institution and the employer shall notify the secretary of rev-
 7  enue with within 15 calendar days.
 8    (b)  Among other provisions, an agreement shall include:
 9    (1)  Provisions regarding payment of program costs, including de-
10  ferred costs, which may be paid from one or a combination of the follow-
11  ing sources:
12    (A)  The IMPACT program services fund;
13    (B)  tuition, student fees, or special charges fixed by the educational
14  institution to defray program costs in whole or in part; and
15    (C)  grants or donations available from federal agencies or other pub-
16  lic or private sources;
17    (2)  a provision requiring each Kansas basic enterprise under the
18  agreement to submit information to the secretary of commerce and hous-
19  ing regarding the numbers of new jobs and the wages and withholding
20  taxes paid therefor;
21    (3)  a provision which fixes any tuition and fee payments which shall
22  be paid for program costs; and
23    (4)  a provision which fixes an amount that shall be paid by an em-
24  ployer if an agreement is terminated or any provision of the agreement
25  is breached by the employer prior to satisfaction of all of the employer's
26  obligations under the agreement and which prescribes that any such pay-
27  ment shall be deposited in the state treasury to the credit of the IMPACT
28  program services fund.; and
29    (5)  a provision which requires an employer to reimburse the state for
30  all funds expended on behalf of the employer under this act if the employer
31  moves all or a significant portion of such employer's business operations
32  to another state within 10 years of such employer's participation in a
33  SKILL or IMPACT project.
34    (c)  Any payment required to be made by an employer shall be a lien
35  upon the employer's business property until paid and has equal prece-
36  dence with ordinary taxes and shall not be divested by a judicial sale.
37  Property subject to the lien may be sold for sums due and delinquent at
38  a tax sale, with the same forfeitures, penalties and consequences as for
39  the nonpayment of ordinary taxes. The purchasers at tax sale obtain the
40  property subject to the remaining payments.
41    (d)  The payment of program costs incurred under any agreement
42  shall not be deferred for a period longer than 10 years from the date of
43  the commencement of the project.
HB 2448
                                     

 1    Sec. 6.  K.S.A. 1996 Supp. 74-50,115 is hereby amended to read as
 2  follows: 74-50,115. (a) A manufacturing business may be eligible for a
 3  sales tax exemption under the provisions of subsection (cc) of K.S.A. 79-
 4  3606, and amendments thereto, if the manufacturing business complies
 5  with the following requirements:
 6    (1)  A manufacturing business shall provide documented evidence of
 7  job expansion involving the employment of at least two additional full-
 8  time employees; and
 9    (2)  a manufacturing business located within the state of Kansas that
10  has documented evidence of job expansion as provided in paragraph (1),
11  which relocates in another city or county within the state of Kansas must
12  receive approval from the secretary prior to qualifying for the sales tax
13  exemption in subsection (cc) of K.S.A. 79-3606, and amendments thereto,
14  except that approval by the secretary shall not be required if the manu-
15  facturing business relocates within the same city.
16    (b)  A nonmanufacturing business may be eligible for a sales tax ex-
17  emption under the provisions of subsection (cc) of K.S.A. 79-3606, and
18  amendments thereto, if the nonmanufacturing business complies with the
19  following requirements:
20    (1)  A nonmanufacturing business shall provide documented evidence
21  of job expansion involving the employment of at least five additional full-
22  time employees; and
23    (2)  a nonmanufacturing business located within the state of Kansas
24  that has documented evidence of job expansion as provided in paragraph
25    (1), which relocates in another city or county within the state of Kansas
26  must receive approval from the secretary prior to qualifying for the sales
27  tax exemption in subsection (cc) of K.S.A. 79-3606, and amendments
28  thereto, except that approval by the secretary shall not be required if the
29  nonmanufacturing business relocates within the same city.
30    (c)  A retail business may qualify for the sales tax exemption under
31  subsection (cc) of K.S.A. 79-3606, and amendments thereto, if the retail
32  business complies with the following requirements:
33    (1)  A retail business shall provide documented evidence of job ex-
34  pansion involving the employment of at least two additional full-time em-
35  ployees; and
36    (2)  such retail business locates or expands to a city having a popula-
37  tion of 2,500 or less, as determined by the latest United States federal
38  census.
39    (d)  Any person constructing, reconstructing, remodeling or enlarging
40  a facility which will be leased for a period of five years or more to a
41  business that would be eligible for a sales tax exemption hereunder if
42  such business had constructed, reconstructed, enlarged or remodeled
43  such facility itself shall be entitled to the sales tax exemption under the
HB 2448
                                     

 1  provisions of subsection (cc) of K.S.A. 79-3606, and amendments thereto.
 2    (e)  A business may qualify for a sales tax exemption under subsection
 3  (cc) of K.S.A. 79-3606, and amendments thereto, without regard to any
 4  of the foregoing requirements of this section if it is certified as a qualified
 5  firm by the secretary of commerce and housing pursuant to K.S.A. 1995
 6  1996 Supp. 74-50,131 and is entitled to the corporate tax credit estab-
 7  lished in K.S.A. 1995 1996 Supp. 74-50,132 or has received written ap-
 8  proval for participation and has participated, during the tax year in which
 9  the exemption is claimed, in training assistance by the department of
10  commerce and housing under the Kansas industrial training, Kansas in-
11  dustrial retraining or state of Kansas investments in lifelong learning pro-
12  gram.
13    (f)  Any retail, manufacturing or nonmanufacturing business which
14  moves all or a significant portion of its business operations to another
15  state within 10 years of claiming an exemption under this act shall be
16  liable to reimburse the state for any sales taxes which would have been
17  imposed on purchases by the business had the purchases not been ex-
18  empted under this section.  Any payment required to be made by a busi-
19  ness shall be a lien upon the business's business property until paid and
20  has equal precedence with ordinary taxes and shall not be divested by a
21  judicial sale. Property subject to the lien may be sold for sums due and
22  delinquent at a tax sale, with the same forfeitures, penalties and conse-
23  quences as for the nonpayment of ordinary taxes. The purchasers at tax
24  sale obtain the property subject to the remaining payments.
25    (f) (g)  The secretary may adopt rules and regulations to implement
26  and administer the provisions of this section.
27    Sec. 7.  K.S.A. 1996 Supp. 74-50,131 is hereby amended to read as
28  follows: 74-50,131. (a) As used in this act: ``Qualified firm'' means a for-
29  profit business establishment, subject to state income, sales or property
30  taxes, identified under the manufacturing standard industrial classifica-
31  tion codes as in effect July 1, 1993, major groups 20 through 39, major
32  groups 40 through 49, and major groups 60 through 89, or is identified
33  as a corporate or regional headquarters or back-office operation of a na-
34  tional or multination corporation regardless of SIC code.
35    (b)  In the case of firms in major groups 40 through 49, and major
36  groups 60 through 89, the business establishment must also demonstrate
37  the following:
38     (1)  More than one-half 1/2 of its gross revenues are a result of sales
39  to commercial or governmental customers outside the state of Kansas; or
40     (2)  more than one-half 1/2 of its gross revenues are a result of sales to
41  Kansas manufacturing firms within major groups 20 through 39; or
42     (3)  more than one-half 1/2 of its gross revenues are a result of a com-
43  bination of sales described in (1) and (2).
HB 2448
                                     

 1    (c)  Additionally, a business establishment having met the criteria as
 2  established in subsection (a) or (b) must meet one of the following criteria:
 3    (1)  The establishment with 500 or fewer full-time equivalent em-
 4  ployees will provide an average wage that is above the average wage paid
 5  by all firms with 500 or fewer full-time equivalent employees in the same
 6  county which share the same two-digit standard industrial classification
 7  code.
 8    (2)  The establishment with 500 or fewer full-time equivalent em-
 9  ployees is the sole firm within its two-digit standard industrial classifica-
10  tion code in the county in which it is located which has 500 or fewer full-
11  time equivalent employees.
12    (3)  The establishment with more than 500 full-time equivalent em-
13  ployees will provide an average wage that is above the average wage paid
14  by firms with more than 500 full-time equivalent employees in the same
15  county which share the same two-digit standard industrial classification
16  code.
17    (4)  The establishment with more than 500 full-time equivalent em-
18  ployees is the sole firm within its two-digit standard industrial classifica-
19  tion code in the county in which it is located which has 500 or more full-
20  time equivalent employees, in which event it shall either provide an
21  average wage that is above the average wage paid by all firms with 500
22  or fewer full-time equivalent employees in the same county which share
23  the same two-digit standard industrial classification code, or be the sole
24  firm with its two-digit standard industrial classification code in the county.
25    (5)  For the purposes of this subsection, the number of full-time
26  equivalent employees shall be determined by adding the number of full-
27  time employees to the number of hours worked by part-time employees
28  divided by 40.
29    (d)  The secretary of commerce and housing shall certify annually to
30  the secretary of revenue that a firm meets the criteria for a qualified firm
31  and that the firm is eligible for the benefits and assistance provided under
32  this act. The secretary of commerce and housing shall publish rules and
33  regulations for the implementation of this act.  Such rules and regulations
34  shall include, but not be limited to:
35    (1)  A definition of ``training and education'' for purposes of K.S.A.
36  1995 1996 Supp. 74-50,132 and amendments thereto.
37    (2)  Establishment of eligibility requirements and application proce-
38  dures for expenditures from the high performance incentive fund created
39  in K.S.A. 1995 1996 Supp. 74-50,133 and amendments thereto.
40    (3)  Establishment of approval guidelines for private consultants au-
41  thorized pursuant to K.S.A. 1995 1996 Supp. 74-50,133 and amendments
42  thereto.
43    (4)  Establishment of guidelines for prioritizing business assistance
HB 2448
                                     

 1  programs pursuant to K.S.A. 1995 1996 Supp. 74-50,133 and amend-
 2  ments thereto.
 3    (5)  A definition of ``commercial customer'' for the purpose of K.S.A.
 4  1995 1996 Supp. 74-50,133 and amendments thereto.
 5    (6)  A definition of ``headquarters'' for the purpose of K.S.A. 1995
 6  1996 Supp. 74-50,133 and amendments thereto.
 7    (e)  Notwithstanding any other provision of this act, any qualified firm
 8  which moves all of a significant portion of its business operations to an-
 9  other state within 10 years of the last taxable year in which the qualified
10  firm last claimed an income tax credit or sales tax exemption pursuant to
11  this act or the last date the firm received a grant pursuant to K.S.A. 74-
12  50,133, and amendments thereto, shall be liable to reimburse the state for
13  any sales or income taxes which would have been imposed had the sales
14  not been exempted or the credits not allowed pursuant to this act. The
15  firm shall also be liable to reimburse the state for any funds granted
16  pursuant to K.S.A. 74-50,133, and amendments thereto. Any payment
17  required to be made by a firm shall be a lien upon the employer's business
18  property until paid and has equal precedence with ordinary taxes and
19  shall not be divested by a judicial sale. Property subject to the lien may
20  be sold for sums due and delinquent at a tax sale, with the same forfeitures,
21  penalties and consequences as for the nonpayment of ordinary taxes. The
22  purchasers at tax sale obtain the property subject to the remaining pay-
23  ments.
24    Sec. 8.  K.S.A. 1996 Supp. 74-50,144 is hereby amended to read as
25  follows: 74-50,144. (a) Subject to the provisions of appropriations acts and
26  in accordance with the provisions of this act, the secretary may provide
27  financial assistance to a Kansas small business concern to reimburse the
28  Kansas small business concern for expenses solely related to the partici-
29  pation in a trade show. Expenses which may be reimbursed under this
30  act shall include only expenses attributable to promoting services origi-
31  nating in Kansas or products which were manufactured or processed in
32  Kansas or which received value-added processing in Kansas and shall not
33  include:
34    (1)  Any compensation, wages or salary of an employee of the Kansas
35  small business concern; or
36    (2)  any travel expenses, including any lodging or meal expenses.
37    (b)  Subject to the provisions of appropriations acts and this act, the
38  amount of financial assistance to a Kansas small business concern shall
39  be the amount determined as follows:
40    (1)  Determine the total amount of expenses incurred by the Kansas
41  small business concern which may be reimbursed under this act and mul-
42  tiply such amount by 1/2;
43    (2)  subtract from the result obtained in paragraph (1) of this subsec-
HB 2448
                                     

 1  tion any amounts received by the Kansas small business concern from a
 2  trade show promotion program, other than the program established by
 3  this act, for participation in the trade show; and
 4    (3)  the amount of such financial assistance shall be the lesser of (A)
 5  the result obtained under paragraph (2) of this subsection, except that if
 6  the result so obtained is less than zero, it shall be considered to be zero
 7  and (B) the amount of $3,500 for trade shows located outside the bound-
 8  aries of the United States of America or the amount of $1,500 for trade
 9  shows located within the boundaries of the United States of America, but
10  international in scope.
11    (c)  The secretary shall not provide more than $7,000 of financial as-
12  sistance for shows held outside the United States and shall not provide
13  more than $3,000 of financial assistance for shows held within the United
14  States, but international in scope, under this act to any Kansas small busi-
15  ness concern during any state fiscal year. Under no circumstances shall
16  any Kansas small business concern receive more then $7,000 in total fi-
17  nancial assistance under this act in any state fiscal year.
18    (d)  No more than 30% of total funds budgeted for any fiscal year
19  shall be used for assistance in attending domestic trade shows that are
20  international in scope.
21    (e)  Any small business which moves all or a significant portion of its
22  business operations to another state within 10 years after receiving finan-
23  cial assistance under this act shall be liable to reimburse the state for any
24  such funds received.  Any payment required to be made by a small business
25  shall be a lien upon the small business's business property until paid and
26  has equal precedence with ordinary taxes and shall not be divested by a
27  judicial sale. Property subject to the lien may be sold for sums due and
28  delinquent at a tax sale, with the same forfeitures, penalties and conse-
29  quences as for the nonpayment of ordinary taxes. The purchasers at tax
30  sale obtain the property subject to the remaining payments.
31    Sec. 9.  K.S.A. 1996 Supp. 74-50,151 is hereby amended to read as
32  follows: 74-50,151. (a) There is hereby created in the state treasury the
33  Kansas economic opportunity initiatives fund. Subject to acts of the leg-
34  islature applicable thereto, the moneys in the Kansas economic oppor-
35  tunity initiatives fund shall be used only for the purposes prescribed by
36  this section.
37    (b)  All expenditures made pursuant to this act shall be made in ac-
38  cordance with appropriations acts upon warrants of the director of ac-
39  counts and reports issued pursuant to vouchers approved by the governor
40  or the governor's designee. The governor may approve a warrant upon
41  certification, by the secretary of commerce and housing, that an economic
42  emergency or unique opportunity exists which warrant funding for a stra-
43  tegic economic intervention by such state agency or agencies to address
HB 2448
                                     

 1  expenses involved in securing economic benefits or avoiding or remedying
 2  economic losses related to:
 3    (1)  A major expansion of an existing Kansas commercial enterprise;
 4    (2)  the potential location in Kansas of the operations of a major em-
 5  ployer;
 6    (3)  the award of a significant federal or private sector grant which has
 7  a financial matching requirement;
 8    (4)  the departure from Kansas or the substantial reduction of the
 9  operations of a major employer; and
10    (5)  the closure of a major federal or state institution or facility.
11    (c)  An intervention strategy may include financial assistance in the
12  form of grants, loans or both. The department of commerce and housing
13  shall adopt written guidelines concerning the terms and conditions of any
14  such loans. However, all repaid funds shall be credited to the Kansas
15  economic opportunity initiatives fund. No intervention strategy approved
16  pursuant to this act shall facilitate the moving of an existing Kansas firm
17  to another location within the state unless such restriction is waived by
18  the secretary of commerce and housing. Every intervention strategy ap-
19  proved pursuant to this act shall identify the intended outcomes to be
20  realized by the strategy for which funding is sought.
21    (d)  The department of commerce and housing and Kansas, Inc. shall
22  make joint findings concerning the costs and benefits, on both a local and
23  statewide basis, of projects proposed pursuant to this act. Prior to allo-
24  cation of any funds pursuant to this act, the governor shall review the
25  cost-benefit findings performed on each project.
26    (e)  The director of the budget and the director of the legislative re-
27  search department shall consult periodically and review the balance cred-
28  ited to and the estimated receipts to be credited to the state economic
29  development initiatives fund during the fiscal year. During any period
30  when the legislature is not in session, upon a finding by the director of
31  the budget in consultation with the director of the legislative research
32  department that the total of the unencumbered balance and estimated
33  receipts to be credited to the state economic development initiatives fund
34  during a fiscal year are insufficient to fund the budgeted expenditures
35  and transfers from the state economic development initiatives fund for
36  the fiscal year in accordance with the provisions of appropriation acts, the
37  director of the budget shall make a certification of such finding to the
38  governor. Upon approval by the governor, the director of accounts and
39  reports shall transfer the amount of moneys from the Kansas economic
40  opportunity initiatives fund to the state economic development initiatives
41  fund that is required, in accordance with a certification by the director
42  of the budget under this subsection, to fund the budgeted expenditures
43  and transfers from the state economic development initiatives fund for
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 1  the fiscal year in accordance with the provisions of appropriation acts, as
 2  specified by the director of the budget pursuant to such certification.
 3    (f)  On or before the 10th day of each month, the director of accounts
 4  and reports shall transfer from the state general fund to the state eco-
 5  nomic development initiatives fund the amount of money certified by the
 6  pooled money investment board in accordance with this section. Prior to
 7  the 10th day of each month, the pooled money investment board shall
 8  certify to the director of accounts and reports the amount of money equal
 9  to the proportionate amount of all the interest credited to the state gen-
10  eral fund for the preceding month, pursuant to K.S.A. 75-4210a and
11  amendments thereto, that is attributable to moneys in the Kansas eco-
12  nomic opportunity initiatives fund. Such amount of money shall be de-
13  termined by the pooled money investment board based on: (1) The av-
14  erage daily balance of moneys in the Kansas economic opportunity
15  initiatives fund during the preceding month as certified to the board by
16  the director of accounts and reports; and (2) the average interest rate on
17  repurchase agreements of less than 30 days duration entered into by the
18  pooled money investment board for that period of time. On or before the
19  fifth day of each month, the director of accounts and reports shall certify
20  to the pooled money investment board the average daily balance of mon-
21  eys in the Kansas economic opportunity initiatives fund during the pre-
22  ceding month.
23    (g)  A five member panel consisting of the secretary of commerce and
24  housing, the president of Kansas, Inc., the president of the Kansas tech-
25  nology enterprise corporation, the private sector chairperson of the board
26  of Kansas, Inc. and the private sector chairperson of the Kansas technol-
27  ogy enterprise corporation shall review annually the propriety of projects
28  funded under this section. The panel shall report its findings to the gov-
29  ernor.
30    (h)  Any commercial enterprise or major employer which moves all or
31  a significant portion of its business operations to another state shall be
32  liable to reimburse the state for any funds expended on its behalf pursuant
33  to this section. Any payment required to be made by an employer or
34  enterprise shall be a lien upon their business property until paid and has
35  equal precedence with ordinary taxes and shall not be divested by a ju-
36  dicial sale. Property subject to the lien may be sold for sums due and
37  delinquent at a tax sale, with the same forfeitures, penalties and conse-
38  quences as for the nonpayment of ordinary taxes. The purchasers at tax
39  sale obtain the property subject to the remaining payments. The secretary
40  of revenue shall collect any such payments and transfer the payments to
41  the credit of the Kansas economic opportunity initiatives fund.
42    Sec. 10.  K.S.A. 1996 Supp. 79-32,153 is hereby amended to read as
43  follows: 79-32,153. (a) Any taxpayer who shall invest in a qualified busi-
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 1  ness facility, as defined in subsection (b) of K.S.A. 79-32,154, and amend-
 2  ments thereto, shall be allowed a credit for such investment, in an amount
 3  determined under subsection (b) against the tax imposed by the Kansas
 4  income tax act for the taxable year during which commencement of com-
 5  mercial operations, as defined in subsection (f) of K.S.A. 79-32,154, and
 6  amendments thereto, occurs at such qualified business facility, and for
 7  each of the nine succeeding taxable years. No credit shall be allowed
 8  under this section unless the number of qualified business facility em-
 9  ployees, as determined under subsection (d) of K.S.A. 79-32,154, and
10  amendments thereto, engaged or maintained in employment at the qual-
11  ified business facility as a direct result of the investment by the taxpayer
12  for the taxable year for which the credit is claimed equals or exceeds two.
13    (b)  The credit allowed by subsection (a) for any taxpayer who invests
14  in a qualified business facility shall be a portion of the income tax, but
15  not in excess of 50% of such tax, otherwise imposed by the Kansas income
16  tax act on the taxpayer's qualified business facility income, as defined in
17  subsection (g) of K.S.A. 79-32,154, and amendments thereto, for the tax-
18  able year for which such credit is allowed. Such portion shall be an
19  amount equal to the sum of the following:
20    (1)  One hundred dollars for each qualified business facility employee
21  determined under K.S.A. 79-32,154, and amendments thereto; plus
22    (2)  one hundred dollars for each $100,000, or major fraction thereof
23  (which shall be deemed to be 51% or more), in qualified business facility
24  investment as determined under K.S.A. 79-32,154, and amendments
25  thereto.
26    (c)  No credit shall be allowed under this section for investment in a
27  public utility, as such term is defined in K.S.A. 66-104, and amendments
28  thereto.
29    (d)  Any taxpayer which owns a business and moves all or a significant
30  portion of the taxpayer's business operations to another state within 10
31  years of any taxable year in which the taxpayer claimed a credit pursuant
32  to this act shall be liable to reimburse the state for any income taxes for
33  which the taxpayer would have been liable except for credits allowed in
34  all prior taxable years under this act.  Any payment required to be made
35  by a taxpayer shall be a lien upon the taxpayer's business property until
36  paid and has equal precedence with ordinary taxes and shall not be di-
37  vested by a judicial sale. Property subject to the lien may be sold for sums
38  due and delinquent at a tax sale, with the same forfeitures, penalties and
39  consequences as for the nonpayment of ordinary taxes. The purchasers at
40  tax sale obtain the property subject to the remaining payments.
41    New Sec. 11.  Any industrial enterprise or agricultural enterprise
42  which receives financial assistance authorized pursuant to K.S.A. 1996
43  Supp. 74-8905, and amendments thereto, shall be liable to reimburse the
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 1  state for all such financial assistance if the enterprise leaves the state
 2  within 10 years of receiving any such financial assistance.  Any payment
 3  required to be made by such enterprises shall be a lien upon the enter-
 4  prises' business property until paid and has equal precedence with ordi-
 5  nary taxes and shall not be divested by a judicial sale. Property subject to
 6  the lien may be sold for sums due and delinquent at a tax sale, with the
 7  same forfeitures, penalties and consequences as for the nonpayment of
 8  ordinary taxes. The purchasers at tax sale obtain the property subject to
 9  the remaining payments. The secretary of revenue shall collect any such
10  payments and transfer the payments to the credit of the Kansas economic
11  opportunity initiatives fund.
12    Sec. 12.  K.S.A. 1996 Supp. 12-1742, 74-5066, 74-50,105, 74-5089,
13  74-50,115, 74-50,131, 74-50,144, 74-50,151 and 79-32,153 are hereby re-
14  pealed.
15    Sec. 13.  This act shall take effect and be in force from and after its
16  publication in the statute book.