Session of 2000
HOUSE BILL No. 2786
By Representative Kuether
2-1
9 AN ACT
concerning state moneys; providing for low interest loans for
10 heritage tourism and
historic preservation; linked deposits; historic
11 heritage preservation
fund; amending K.S.A. 75-4209 and 75-4237 and
12 repealing the existing
sections; also repealing K.S.A. 75-2729 and 79-
13 3107b.
14
15 Be it enacted by the Legislature of the
State of Kansas:
16 New Section
1. The provisions of sections 1 through 10, and amend-
17 ments thereto, shall be known and may be
cited as the Kansas heritage
18 tourism and historic preservation linked
deposit act.
19 New Sec.
2. As used in this act:
20 (a) "Heritage
tourism and historic preservation linked deposit" means
21 an investment account placed by the
director of investments under the
22 provisions of article 42 of chapter 75 of
the Kansas Statutes Annotated,
23 and amendments thereto, with an eligible
lending institution for the pur-
24 pose of carrying out the intent of this
act;
25 (b) "heritage
tourism and historic preservation loan package" means
26 the forms created by and provided by the
state treasurer for the purpose
27 of applying for a heritage tourism and
historic preservation linked deposit;
28 (c) "eligible
lending institution" means a bank, as defined under
29 K.S.A. 75-4201, and amendments thereto,
that agrees to participate in
30 the Kansas heritage tourism and historic
preservation linked deposit pro-
31 gram and is eligible to be a depository of
state funds; and
32 (d) "person"
means a natural person, individual, public or private
33 corporation, government, partnership or
unincorporated association.
34 New Sec.
3. (a) (1) There is hereby established in the state
treasury
35 the historic heritage preservation fund
which shall be administered by
36 the state treasurer. All moneys deposited
in the historic heritage preser-
37 vation fund shall be used for the purpose
of awarding low interest loans
38 to assist historic preservation projects
involving property included in the
39 national register of historic places or the
state register of historic places,
40 excluding property owned by the state or
federal government, and shall
41 be used by the state treasurer for the
administration of the heritage tour-
42 ism and historic preservation linked
deposit act. For-profit corporation
43 applicants shall be assisted only if the
property's continued historic exis-
2
1 tence is threatened or its
rehabilitation is not economically feasible with-
2 out the low interest linked deposit
loan assistance. The state treasurer
3 shall ensure that such moneys are
expended for the purpose of this sec-
4 tion, and may adopt rules and
regulations as necessary to carry out the
5 purpose of this section.
6 (2) In
evaluating low interest linked deposit loan applications
involv-
7 ing historic preservation projects
under subsection (a)(1), the state his-
8 torical society shall verify whether
the applicant's project is a historic
9 preservation project involving
property included in the national or state
10 register of historic places and assess and
comment on the following fac-
11 tors: The level of historical significance
of the property; the condition of
12 the property; the urgency of the
preservation work proposed; whether or
13 not the property is endangered and the type
of work proposed.
14 (3) The state
historical preservation officer may inspect a rehabili-
15 tated property at any time during the
five-year period after the low in-
16 terest linked deposit is approved and may
revoke or invalidate the ap-
17 proval if work was not undertaken as
presented in the loan application or
18 if further unapproved alterations have been
made. Modifications made
19 during the five-year period following the
approval of the loan shall be
20 made in accordance with standards
established by the state historical
21 society.
22 (b) Except as
otherwise provided in this section, all expenditures from
23 the historic heritage preservation fund
shall be made in accordance with
24 appropriation acts upon warrants of the
director of accounts and reports
25 issued pursuant to vouchers approved by the
state treasurer or the state
26 treasurer's designee.
27 New Sec.
4. (a) On July 1, 2000, the director of accounts and
reports
28 shall transfer all moneys in the heritage
trust fund to the state general
29 fund. On July 1, 2000, all liabilities of
heritage trust fund are hereby
30 transferred to and imposed on the state
general fund and the heritage
31 trust fund is hereby abolished.
32 (b) On July 1,
2000, the director of accounts and reports shall transfer
33 $3,600,000 from the state general fund to
the historic heritage preser-
34 vation fund.
35 New Sec.
5. (a) The state treasurer shall create the proper
applica-
36 tion forms for persons applying for a
heritage tourism and historic pres-
37 ervation linked deposit loan.
38 (b) The state
treasurer shall administer the Kansas heritage tourism
39 and historic preservation linked deposit
program. Such program shall be
40 for the exclusive purpose of providing
incentives for the making of loans
41 for the restoration and preservation of
heritage tourism and historic pres-
42 ervation sites.
43 (c) The state
treasurer shall adopt rules and regulations to carry out
3
1 the provisions of this act.
2 (d) The
state treasurer shall charge, impose and collect administrative
3 fees in connection with each linked
deposit loan granted and transfer such
4 fees to the state general fund.
5 (e) The
state treasurer shall submit an annual report outlining the
6 status of the program to the governor
and the legislature.
7 New Sec.
6. (a) The state treasurer shall disseminate information
and
8 to provide heritage tourism and
historic preservation linked deposit loan
9 packages to lending institutions
eligible for participation in this act.
10 (b) The heritage
tourism and historic preservation linked deposit loan
11 package application shall be completed by
the borrower and sent to the
12 state historical society which shall verify
that the project meets the criteria
13 in section 3, and amendments thereto,
before forwarding it to the lending
14 institution for consideration.
15 (c) (1) An
eligible lending institution that agrees to receive a heritage
16 tourism and historic preservation linked
deposit shall accept and review
17 applications for loans from eligible
heritage tourism and historic preser-
18 vation applicants. The lending institution
shall apply all usual lending
19 standards to determine the credit
worthiness of eligible applicants. No
20 single linked deposit loan for the purposes
of sections 1 through 10, and
21 amendments thereto, shall exceed $100,000.
The total amount of the
22 linked deposit loans shall not exceed
$3,000,000 in any one year.
23 (2) Only one
linked deposit loan shall be made and be outstanding
24 at any one time to any heritage tourism and
historic preservation
25 applicant.
26 (3) No loan shall
be amortized for a period of more than 10 years.
27 (d) An eligible
heritage tourism and historic preservation applicant
28 shall certify on its loan application that
the reduced rate loan will be used
29 exclusively for the purposes of this
act.
30 (e) The eligible
lending institution may approve or reject a heritage
31 tourism and historic preservation linked
deposit loan package based on
32 the lending institution's evaluation of the
eligible heritage tourism and
33 historic preservation project included in
the package, the amount of the
34 individual loan in the package and other
appropriate considerations.
35 (f) The eligible
lending institution shall forward to the state treasurer
36 an approved linked deposit loan package in
the form and manner pre-
37 scribed and approved by the state
treasurer. The package shall include
38 information regarding the amount of the
loan requested by each heritage
39 tourism and historic preservation applicant
and such other information
40 regarding each project that the state
treasurer requires, including certi-
41 fication by the applicant that such
applicant is an eligible project
42 borrower.
43 New Sec.
7. (a) The state treasurer may accept or reject a heritage
4
1 tourism and historic preservation
linked deposit loan package based on
2 the state treasurer's evaluation of
whether the loan to the eligible appli-
3 cant meets the purposes of this
act.
4 (b) The
state treasurer shall consider the following factors when eval-
5 uating the project application: The
geographical distribution of assisted
6 properties; the administrative
ability of the applicant; the potential benefit
7 to the community and the state;
community support for the project; in-
8 eligibility of the project for other
funds and an assessment of the need of
9 the owner for the loan assistance to
do the project. If sufficient funds are
10 not available for a linked deposit loan,
then applications may be consid-
11 ered in the order received when funds are
once again available subject
12 to a review by the lending institution.
13 (c) Upon
acceptance, the state treasurer shall certify to the director
14 of investments the amount required for such
heritage tourism and historic
15 preservation linked deposit loan package
from the historic heritage pres-
16 ervation fund. The director of investments
shall then place the linked
17 deposit in the amount certified by the
state treasurer with the eligible
18 lending institution at a 2% interest rate.
When necessary, the state trea-
19 surer may request the director of
investments to place such linked deposit
20 prior to acceptance of the loan
package.
21 (d) The eligible
lending institution shall enter into a heritage tourism
22 and historic preservation linked deposit
agreement with the state trea-
23 surer, which shall include requirements
necessary to implement the pur-
24 poses of the Kansas heritage tourism and
historic preservation linked de-
25 posit program. Such requirements shall
include an agreement by the
26 eligible lending institution to lend an
amount equal to the linked deposit
27 to eligible heritage tourism and historic
preservation applicants at an in-
28 terest rate that does not exceed 6%. The
agreement shall include provi-
29 sions for such linked deposit to be placed
for a maturity considered ap-
30 propriate in coordination with the
underlying linked deposit loan. The
31 agreement shall include provisions for the
reduction of such linked de-
32 posit in an amount equal to any payment of
loan principal by the eligible
33 heritage tourism and historic preservation
project.
34 New Sec.
8. (a) Upon placement of a heritage tourism and historic
35 preservation linked deposit with an
eligible lending institution, the insti-
36 tution shall fund the loan to each approved
linked deposit loan applicant
37 in accordance with the institution and the
state treasurer. The loan shall
38 be at a rate as provided in section 7, and
amendments thereto. A certi-
39 fication of compliance with this section in
the form and manner as pre-
40 scribed by the state treasurer shall be
required of all eligible lending
41 institutions.
42 (b) The state
treasurer shall take any and all steps necessary to im-
43 plement the Kansas heritage tourism and
historic preservation linked de-
5
1 posit program.
2 New Sec.
9. The state and state treasurer shall not be liable to
any
3 eligible lending institution in any
manner for payment of the principal or
4 interest on the loan to an approved
project. Any delay in payments or
5 default on the part of an approved
program participant does not in any
6 manner affect the heritage tourism
and historic preservation linked de-
7 posit agreement between the eligible
lending institution and the state
8 treasurer.
9 New Sec.
10. (a) Except as provided in subsection (b), the county
10 treasurer shall pay quarterly to the state
treasurer, commencing on Oc-
11 tober 1, 2000, $.03 of each $.26 paid to
the county treasurer during the
12 preceding calendar quarter from mortgage
registration fees under K.S.A.
13 79-3101 to 79-3107, inclusive, and
amendments thereto, and credited to
14 the county general fund under K.S.A.
79-3104, and amendments thereto.
15 All such moneys paid to the state treasurer
shall be deposited in the state
16 treasury and credited to the historic
heritage preservation fund.
17 (b) No payments
under subsection (a) shall be made by the county
18 treasurer to the state treasurer during any
calendar year in excess of a
19 total of $300,000. All moneys collected in
excess of this amount which
20 under subsection (a) would be paid to the
state treasurer shall be credited
21 to the county general fund.
22 Sec.
11. K.S.A. 75-4209 is hereby amended to read as follows:
75-
23 4209. (a) The director of investments
may invest and reinvest state mon-
24 eys eligible for investment which are not
invested in accordance with
25 K.S.A. 75-4237, and amendments
thereto, in the following investments:
26 (1) Direct
obligations of, or obligations that are insured as to principal
27 and interest by, the United States of
America or any agency thereof and
28 obligations and securities of the United
States sponsored enterprises
29 which under federal law may be accepted as
security for public funds, on
30 and after the effective date of this act
moneys available for investment
31 under this subsection shall not be invested
in mortgage-backed securities
32 of such enterprises and of the government
national mortgage association,
33 except that any such mortgage-backed
securities held prior to the effec-
34 tive date of this act may be held to
maturity;
35 (2) repurchase
agreements with a bank or a primary government se-
36 curities dealer which reports to the market
reports division of the federal
37 reserve bank of New York for direct
obligations of, or obligations that are
38 insured as to principal and interest by,
the United States government or
39 any agency thereof and obligations and
securities of United States gov-
40 ernment sponsored enterprises which under
federal law may be accepted
41 as security for public funds;
and
42 (3) commercial
paper that does not exceed 270 days to maturity and
43 which has received one of the two highest
commercial paper credit ratings
6
1 by a nationally recognized investment
rating firm.
2 (b) When
moneys are available for deposit or investments, the direc-
3 tor of investments may invest in
SKILL act projects and bonds pursuant
4 to K.S.A. 1997
1999 Supp. 74-8920, and amendments thereto, and in state
5 agency bonds and bond projects.
6 (c) When
moneys are available for deposits or investments, the di-
7 rector of investments may invest in
preferred stock of Kansas venture
8 capital, inc., under terms and
conditions prescribed by K.S.A. 74-8203,
9 and amendments thereto, but such
investments shall not in the aggregate
10 exceed a total amount of $10,000,000.
11 (d) When moneys
are available for deposits or investments, the di-
12 rector of investments may invest in loans
pursuant to legislative mandates,
13 except that not more than the lesser of 10%
or $80,000,000 of the state
14 moneys shall be invested.
15 (e) Interest on
investment accounts in banks is to be paid at maturity,
16 but not less than annually.
17 (f) Investments
made by the director of investments under the pro-
18 visions of this section shall be made with
judgment and care, under cir-
19 cumstances then prevailing, which persons
of prudence, discretion and
20 intelligence exercise in the management of
their own affairs, not for spec-
21 ulation, but for investment, considering
the probable safety of their capital
22 as well as the probable income to be
derived.
23 (g) Investments
under subsection (a) or (b) of this section or under
24 K.S.A. 75-4237, and amendments
thereto, shall be for a period not to
25 exceed four years, except that heritage
tourism and historic preservation
26 linked deposits authorized under the
provisions of sections 1 through 10,
27 and amendments thereto, shall not exceed
a period of 10 years.
28 (h) Investments
in securities under paragraph (1) of subsection (a)
29 shall be limited to securities which do not
have any more interest rate
30 risk than do direct United States
government obligations of similar ma-
31 turities. For purposes of this subsection,
"interest rate risk" means market
32 value changes due to changes in current
interest rates.
33 (i) The director
of investments shall not invest state moneys eligible
34 for investment under subsection (a), in the
municipal investment pool
35 fund, created under K.S.A.
1997 1999 Supp. 12-1677a, and
amendments
36 thereto.
37 (j) The director
of investments shall not invest moneys in the pooled
38 money investment portfolio in derivatives.
As used in this subsection,
39 "derivatives" means a financial contract
whose value depends on the value
40 of an underlying asset or index of asset
values.
41 (k) Moneys and
investments in the pooled money investment port-
42 folio shall be invested and reinvested by
the director of investments in
43 accordance with investment policies
developed, approved, published and
7
1 updated on an annual basis by the
board. Such investment policies shall
2 include at a minimum guidelines which
identify credit standards, eligible
3 instruments, allowable maturity
ranges, methods for valuing the portfolio,
4 calculating earnings and yields and
limits on portfolio concentration for
5 each type of investment. Any changes
in such investment policies shall
6 be approved by the pooled money
investment board. Such investment
7 policies may specify the contents of
reports, methods of crediting funds
8 and accounts and other operating
procedures.
9 (l) The
board shall adopt rules and regulations to establish an overall
10 percentage limitation on the investment of
moneys in investments au-
11 thorized under paragraph (3) of subsection
(a), and within such author-
12 ized investment, the board shall establish
a percentage limitation on the
13 investment in any single business
entity.
14 Sec.
12. K.S.A. 75-4237 is hereby amended to read as follows:
75-
15 4237. (a) The director of investments shall
accept requests from banks
16 interested in obtaining investment accounts
of state moneys. Such re-
17 quests may be submitted any business day
and shall specify the dollar
18 amount, maturity or maturity range and
interest rate. If the interest rate
19 bid by the bank is at or greater than the
market rate determined by the
20 director of investments in accordance with
subsection (b), the director of
21 investments is authorized to award the
investment account to the bidding
22 bank at the market rate. Awards of
investment accounts pursuant to this
23 section shall be subject to investment
policies of the pooled money in-
24 vestment board. When multiple bids are
received and are in excess of the
25 amount available for investment that day
for any maturity, awards shall
26 be made available in ascending order from
smallest to largest dollar
27 amount bid, subject to investment policies
of the board.
28 (b) The market
rate shall be determined each business day by the
29 director of investments, in accordance with
any procedures established
30 by the pooled money investment board.
Subject to any policies of the
31 board, the market rate shall reflect the
highest rate at which state moneys
32 can be invested on the open market in
investments authorized by sub-
33 section (a) of K.S.A. 75-4209 and
amendments thereto for equivalent
34 maturities.
35
(c) Notwithstanding the provisions of this section,
heritage tourism
36 and historic preservation linked
deposits made pursuant to the provisions
37 of sections 1 through 10, and amendments
thereto, shall be at 2% interest
38 rate.
39 Sec. 13. K.S.A. 75-2729,
75-4209, 75-4237 and 79-3107b are hereby
40 repealed.
41 Sec. 14. This act shall
take effect and be in force from and after its
42 publication in the statute book.