Brief (1)
HB 3019 would authorize the Kansas Development Finance Authority (KDFA) to issue bonds to finance a multi-sport athletic complex for Kansas City Kansas Community College (KCKCC).
KDFA Bond Issue. Issuance of the bonds would be dependent upon KDFA receiving and approving the project feasibility study. The maximum maturity of bonds issued for the project would be 30 years. Project costs, including bonds, would be paid utilizing a form of tax increment financing, which, in this case, is revenue captured from increased state and local sales tax collected within the project area boundaries (defined in the bill as "increment"). No property tax increments could be used to pay for the principal and interest on the bonds. The bill also would authorize use of other moneys of the community college, including that derived from private or federal sources. However, proceeds from student tuition could not be used.
Resolution by KCKCC Board of Trustees. The Board would establish the project by adopting a resolution including a detailed description of the buildings and facilities proposed to be constructed or improved, the boundaries of the project area, the estimated cost of the project, and the completion date. The bill specifies that the project could be undertaken in separate development stages, but that, the project would have to be completed on or before the final scheduled maturity of the first series of bonds issued to finance the project. Changes to the project as described in that original resolution could only be made through subsequent resolutions.
Feasibility Study. The KCKCC Board of Trustees would have to contract with a nationally recognized consultant for preparation of a comprehensive project feasibility study. Minimum requirements for that study are enumerated in the bill.
Resolution by County. If the project area involves expansion beyond the KCKCC campus, the governing body of the county would have to approve the expansion after providing notice to the affected school district, publishing a notice of the proposed boundaries, and holding a public hearing. If the Unified Government adopts the resolution, any proposed county-wide sales tax authorized by KSA 12-187 would be subject to electorate approval.
Resort Facilities. The KDFA would be authorized to issue tax-exempt bonds to finance resort facilities in an amount not to exceed $30 million for any one resort. (Legislation enacted in 1998 authorized the KDFA to issue bonds for this purpose but such bonds could not be tax exempt pursuant to KSA 32-869.)
Effective Date of Act. The bill would become effective upon publication in the Kansas Register.
Background
The House Committee on Economic Development and the Senate Committee on Federal and State Affairs each held a hearing on the bill, at which time proponents described the proposed project and plans for funding. No opponents of the bill presented testimony to either committee. A representative of the KDFA suggested to the Senate Committee clarification of several provisions of the bill.
The Senate Committee amended the bill to:
The Senate Committee of the Whole amended the bill to make further technical and clarifying amendments. Other amendments included prohibition of the use of property tax increments to pay for the principal and interest on the bonds issued by KDFA for the multi-sport athletic project, a requirement that a county-wide sales tax would be subject to electorate approval, and authorization to the KDFA to issue tax-exempt bonds for resort facilities.
The Department of Revenue reports that the passage of the introduced version of HB 3019 could result in reduction of potential future revenues. However, the fiscal impact of the bill is dependent on a variety of factors and as such, a precise estimate is not possible.
1. *Supplemental notes are prepared by the Legislative Research Department and do not express legislative intent. The supplemental note and fiscal note for this bill may be accessed on the Internet at http://www.ink.org/public/legislative/bill_search.html