Kansas 2023-2024 Regular Session

Kansas House Bill HB2450 Compare Versions

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1	1	Session of 2023
2	2	HOUSE BILL No. 2450
3	3	By Committee on Taxation
4	4	3-8
5	5	AN ACT concerning sales taxation; relating to economic development;
6	6	providing a sales tax exemption for the construction or remodeling of a
7	7	qualified data center in Kansas, the purchase of data center equipment
8	8	and eligible data center costs, electricity and certain labor costs to
9	9	qualified firms that make a minimum investment of at least
10	10	$600,000,000 and meet new Kansas jobs and other requirements;
11	11	amending K.S.A. 2022 Supp. 79-3606 and repealing the existing
12	12	section.
13	13	Be it enacted by the Legislature of the State of Kansas:
14	14	New Section 1. For purposes of sections 1 through 3, and
15	15	amendments thereto:
16	16	(a) "Commencement of construction" means the date that
17	17	construction, reconstruction, enlargement or remodeling of a qualified data
18	18	center by a qualified firm commences, as determined by the secretary.
19	19	(b) "Commencement of operations" means the date that the qualified
20	20	firm commences operations at a qualified data center, as determined by the
21	21	secretary.
22	22	(c) "Data center equipment" means computer equipment or software
23	23	purchased or leased for the processing, storage, retrieval or communication
24	24	of data, including the following:
25	25	(1) Servers, routers, connections, monitoring and security systems
26	26	and other enabling machinery, equipment and hardware, regardless of
27	27	whether the property is or is not affixed to or incorporated into real
28	28	property;
29	29	(2) equipment used in the operation of computer equipment or
30	30	software or for the benefit of the qualified data center, including, but not
31	31	limited to, component parts, installations, refreshments, replacements and
32	32	upgrades, regardless of whether the property is or is not affixed to or
33	33	incorporated into real property;
34	34	(3) all equipment necessary for the transformation, generation,
35	35	distribution or management of electricity that is required to operate
36	36	computer server equipment, including, but not limited to, substations,
37	37	generators, uninterruptible energy equipment, supplies, conduit, fuel
38	38	piping and storage, cabling, duct banks, switches, switchboards, batteries,
39	39	testing equipment and backup generators;
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76	76	(4) all equipment necessary to cool and maintain a controlled
77	77	environment for the operation of the computer servers and other
78	78	components of the qualified data center, including, but not limited to,
79	79	chillers, mechanical equipment, refrigerant piping, fuel piping and storage,
80	80	adiabatic and free cooling systems, cooling towers, water softeners, air
81	81	handling units, indoor direct exchange units, fans, ducting and filters;
82	82	(5) all water conservation systems, including facilities or mechanisms
83	83	that are designed to collect, conserve and reuse water;
84	84	(6) all computer server equipment, chassis, networking equipment,
85	85	switches, racks, fiber optic and copper cabling, trays and conduit;
86	86	(7) all conduit, ducting and fiber optic and copper cabling directly
87	87	related to connecting one or more distributed qualified data center
88	88	locations regardless of whether located inside or outside a data center;
89	89	(8) all monitoring equipment and security systems;
90	90	(9) modular data centers and preassembled components of any item
91	91	described in paragraph (1), including components used in the
92	92	manufacturing of modular data centers;
93	93	(10) all software; and
94	94	(11) other tangible and intangible personal property that is essential to
95	95	the operations of a qualified data center, excluding such property used in
96	96	the administration of the qualified data center.
97	97	(d) "Department" means the department of commerce.
98	98	(e) "Eligible data center costs" means expenditures for the
99	99	development, acquisition, construction and operation of a qualified data
100	100	center, including, but not limited to, costs of land, buildings, site
101	101	improvements, modular data centers, computer data center equipment
102	102	acquisition and permitting, lease payments, site characterization and
103	103	assessment, engineering and design used directly and exclusively for a
104	104	qualified data center.
105	105	(f) "New jobs" means newly created jobs with a qualified firm at a
106	106	qualified data center or directly associated with a qualified data center
107	107	filled by Kansas residents and the primary work locations are in Kansas.
108	108	(g) "Qualified data center" means one or more buildings that are
109	109	constructed, reconstructed, enlarged or remodeled to house a group of
110	110	networked computer servers in this state to centralize the storage,
111	111	management and dissemination of data and information pertaining to a
112	112	particular business, taxonomy or body of knowledge.
113	113	(h) "Qualified firm" means a business that is subject to Kansas state
114	114	income tax and is engaged in data processing, storage and dissemination.
115	115	(i) "Secretary" means the secretary of commerce.
116	116	New Sec. 2. (a) A qualified firm that makes an investment in a
117	117	qualified data center of at least $600,000,000 in the aggregate within the
118	118	first five calendar years after commencement of construction, and creates
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162	162	and maintains at least 20 new jobs at the qualified data center within two
163	163	calendar years after the commencement of operations shall receive a sales
164	164	tax exemption, as provided by section 3, and amendments thereto, and
165	165	K.S.A. 79-3606(pppp), and amendments thereto, for:
166	166	(1) Eligible data center costs of the qualified data center;
167	167	(2) data center equipment;
168	168	(3) all electricity used by a qualified data center; and
169	169	(4) labor services to install, apply, repair, service, alter or maintain
170	170	data center equipment.
171	171	(b) To be eligible to receive such sales tax exemption, a qualified firm
172	172	shall:
173	173	(1) Submit an application to the secretary in the form and manner as
174	174	required by the secretary;
175	175	(2) commit to an investment of at least $600,000,000 in the qualified
176	176	data center to be completed within five calendar years of the
177	177	commencement of construction or on such earlier date as specified in the
178	178	agreement pursuant to paragraph (4);
179	179	(3) commit to begin construction of the project within 10 years of the
180	180	date of the agreement with the secretary or on such earlier date as specified
181	181	in the agreement pursuant to paragraph (4); and
182	182	(4) if the application is approved by the secretary, enter into an
183	183	agreement with the secretary upon such terms and conditions as the
184	184	secretary may require, including the commitments or conditions required
185	185	by paragraphs (2) and (3) and subsections (c) and (d)(1) and (2). The
186	186	agreement shall be entered into before any sales tax exemption may be
187	187	provided under this act.
188	188	(c) if it is determined by the secretary that the qualified firm has
189	189	breached a term or condition of the agreement, the secretary shall provide
190	190	written notice to the qualified firm as to which terms or conditions were
191	191	breached and allow the qualified firm 60 days to cure the breached terms
192	192	or conditions. If the breached terms or conditions have not been cured
193	193	within such time, the secretary may require the qualified firm to repay all
194	194	or a part of the amount of the sales tax exemption received, terminate the
195	195	sales tax exemption or suspend all or a part of the sales tax exemption for
196	196	as long as the breach is not cured.
197	197	(d) As a condition of receiving the sales tax exemption, a qualified
198	198	firm shall agree to:
199	199	(1) Cooperate with any audit undertaken by the secretary of revenue
200	200	as provided by subsection (f); and
201	201	(2) provide the secretary of commerce information required:
202	202	(A) For publication in the economic development incentive program
203	203	information database pursuant to K.S.A. 2022 Supp. 74-50,226, and
204	204	amendments thereto;
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248	248	(B) for the secretary's report pursuant to K.S.A. 74-50,320, and
249	249	amendments thereto; and
250	250	(C) by the secretary of commerce or the secretary of revenue pursuant
251	251	to subsection (e)(1).
252	252	(e) (1) The secretary shall conduct a review every five years of the
253	253	activities undertaken by a qualified firm to ensure that the qualified firm
254	254	remains in good standing with the state and in compliance with the
255	255	provisions of this act, any rules and regulations adopted by the secretary
256	256	with respect to this act and any agreement entered into pursuant to this
257	257	section and continues to meet the requirements for the sales tax exemption
258	258	provided under this act. The secretary of commerce shall certify every five
259	259	years to the secretary of revenue whether the qualified firm meets the
260	260	criteria for designation as a qualified firm and is eligible for such sales tax
261	261	exemption. The qualified firm shall provide the secretary of commerce all
262	262	information reasonably necessary to determine such eligibility. Except as
263	263	provided by paragraph (2), information obtained under this paragraph shall
264	264	not be subject to disclosure pursuant to K.S.A. 45-215 et seq., and
265	265	amendments thereto, unless subject to disclosure pursuant to subsection
266	266	(d)(1) or (2), but shall upon request be made available to the legislative
267	267	post audit division. The provisions of this paragraph providing for
268	268	confidentiality of records shall expire on July 1, 2028, unless the
269	269	legislature reviews and acts to continue such provisions pursuant to K.S.A.
270	270	45-229, and amendments thereto, prior to July 1, 2028.
271	271	(2) Confidential financial information, any trade secret or other
272	272	information that, if known, would place the qualified firm at a
273	273	disadvantage in the marketplace or would significantly interfere with the
274	274	purposes of this act in the judgment of the secretary that is obtained under
275	275	this section shall not be subject to disclosure pursuant to K.S.A. 45-215 et
276	276	seq., and amendments thereto, but shall upon request be made available to
277	277	the legislative post audit division. The provisions of this paragraph
278	278	providing for confidentiality of records shall expire on July 1, 2028, unless
279	279	the legislature reviews and acts to continue such provisions pursuant to
280	280	K.S.A. 45-229, and amendments thereto, prior to July 1, 2028.
281	281	(f) The books and records that pertain to eligibility for benefits or
282	282	compliance with the requirements of this act shall be available for
283	283	inspection by the secretary or the secretary's duly authorized agents or
284	284	employees during business hours on at least 30 days' prior written notice.
285	285	The secretary may request the department of revenue to audit the qualified
286	286	firm, or a third party if applicable, for compliance with the provisions of
287	287	this act.
288	288	(g) The secretary of commerce shall certify to the secretary of
289	289	revenue when the qualified firm has met the conditions to receive a sales
290	290	tax exemption as provided by section 2, and amendments thereto, and shall
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334	334	provide notice when the sales tax exemption is modified, suspended or
335	335	terminated pursuant to subsection (c).
336	336	(h) The secretary of commerce or the secretary of revenue may adopt
337	337	rules and regulations for the implementation of this act.
338	338	New Sec. 3. (a) On and after July 1, 2023, a qualified firm that meets
339	339	the requirements of section 2, and amendments thereto, may be eligible for
340	340	a sales tax exemption as provided by this section and the provisions of
341	341	K.S.A. 79-3606(pppp), and amendments thereto.
342	342	(b) Qualified firms shall be eligible for such sales tax exemption
343	343	commencing on the date that the qualified firm commences construction of
344	344	the qualified data center, as determined by the secretary of commerce, or
345	345	an earlier date if provided by the agreement pursuant to section 2, and
346	346	amendments thereto.
347	347	(c) To be eligible to receive the sales tax exemption, the qualified
348	348	firm shall have been approved by and entered into an agreement with the
349	349	secretary to make an investment in a qualified data center of at least
350	350	$600,000,000 as provided by section 2, and amendments thereto.
351	351	(d) The sales tax exemption shall be valid:
352	352	(1) For 30 years after the date of commencement of construction for
353	353	qualified firms making an investment of at least $600,000,000 in a
354	354	qualified data center;
355	355	(2) for 40 years after the date of commencement of construction for
356	356	qualified firms making an investment of at least $800,000,000 in a
357	357	qualified data center; or
358	358	(3) indefinitely after the date of commencement of construction for
359	359	qualified firms making an investment of at least $1,000,000,000 in a
360	360	qualified data center.
361	361	(e) The secretary of commerce shall provide notice to the secretary of
362	362	revenue regarding an approval of a sales tax exemption under this section.
363	363	No sales tax exemption shall be approved by the secretary of revenue
364	364	unless the qualified firm has been certified by the secretary of commerce,
365	365	as provided in section 2, and amendments thereto, as meeting all
366	366	requirements of this act, of the rules and regulations of the secretary, if
367	367	any, and of the agreement executed pursuant to section 2, and amendments
368	368	thereto.
369	369	(f) A sales tax exemption shall be revoked, suspended or modified by
370	370	the secretary of revenue as requested by the secretary of commerce upon
371	371	notification that the qualified firm has been disapproved by the secretary
372	372	of commerce as provided by section 2, and amendments thereto.
373	373	Sec. 4. K.S.A. 2022 Supp. 79-3606 is hereby amended to read as
374	374	follows: 79-3606. The following shall be exempt from the tax imposed by
375	375	this act:
376	376	(a) All sales of motor-vehicle fuel or other articles upon which a sales
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420	420	or excise tax has been paid, not subject to refund, under the laws of this
421	421	state except cigarettes and electronic cigarettes as defined by K.S.A. 79-
422	422	3301, and amendments thereto, including consumable material for such
423	423	electronic cigarettes, cereal malt beverages and malt products as defined
424	424	by K.S.A. 79-3817, and amendments thereto, including wort, liquid malt,
425	425	malt syrup and malt extract, that is not subject to taxation under the
426	426	provisions of K.S.A. 79-41a02, and amendments thereto, motor vehicles
427	427	taxed pursuant to K.S.A. 79-5117, and amendments thereto, tires taxed
428	428	pursuant to K.S.A. 65-3424d, and amendments thereto, drycleaning and
429	429	laundry services taxed pursuant to K.S.A. 65-34,150, and amendments
430	430	thereto, and gross receipts from regulated sports contests taxed pursuant to
431	431	the Kansas professional regulated sports act, and amendments thereto;
432	432	(b) all sales of tangible personal property or service, including the
433	433	renting and leasing of tangible personal property, purchased directly by the
434	434	state of Kansas, a political subdivision thereof, other than a school or
435	435	educational institution, or purchased by a public or private nonprofit
436	436	hospital, public hospital authority, nonprofit blood, tissue or organ bank or
437	437	nonprofit integrated community care organization and used exclusively for
438	438	state, political subdivision, hospital, public hospital authority, nonprofit
439	439	blood, tissue or organ bank or nonprofit integrated community care
440	440	organization purposes, except when: (1) Such state, hospital or public
441	441	hospital authority is engaged or proposes to engage in any business
442	442	specifically taxable under the provisions of this act and such items of
443	443	tangible personal property or service are used or proposed to be used in
444	444	such business; or (2) such political subdivision is engaged or proposes to
445	445	engage in the business of furnishing gas, electricity or heat to others and
446	446	such items of personal property or service are used or proposed to be used
447	447	in such business;
448	448	(c) all sales of tangible personal property or services, including the
449	449	renting and leasing of tangible personal property, purchased directly by a
450	450	public or private elementary or secondary school or public or private
451	451	nonprofit educational institution and used primarily by such school or
452	452	institution for nonsectarian programs and activities provided or sponsored
453	453	by such school or institution or in the erection, repair or enlargement of
454	454	buildings to be used for such purposes. The exemption herein provided
455	455	shall not apply to erection, construction, repair, enlargement or equipment
456	456	of buildings used primarily for human habitation, except that such
457	457	exemption shall apply to the erection, construction, repair, enlargement or
458	458	equipment of buildings used for human habitation by the cerebral palsy
459	459	research foundation of Kansas located in Wichita, Kansas, and multi
460	460	community diversified services, incorporated, located in McPherson,
461	461	Kansas;
462	462	(d) all sales of tangible personal property or services purchased by a
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506	506	contractor for the purpose of constructing, equipping, reconstructing,
507	507	maintaining, repairing, enlarging, furnishing or remodeling facilities for
508	508	any public or private nonprofit hospital or public hospital authority, public
509	509	or private elementary or secondary school, a public or private nonprofit
510	510	educational institution, state correctional institution including a privately
511	511	constructed correctional institution contracted for state use and ownership,
512	512	that would be exempt from taxation under the provisions of this act if
513	513	purchased directly by such hospital or public hospital authority, school,
514	514	educational institution or a state correctional institution; and all sales of
515	515	tangible personal property or services purchased by a contractor for the
516	516	purpose of constructing, equipping, reconstructing, maintaining, repairing,
517	517	enlarging, furnishing or remodeling facilities for any political subdivision
518	518	of the state or district described in subsection (s), the total cost of which is
519	519	paid from funds of such political subdivision or district and that would be
520	520	exempt from taxation under the provisions of this act if purchased directly
521	521	by such political subdivision or district. Nothing in this subsection or in
522	522	the provisions of K.S.A. 12-3418, and amendments thereto, shall be
523	523	deemed to exempt the purchase of any construction machinery, equipment
524	524	or tools used in the constructing, equipping, reconstructing, maintaining,
525	525	repairing, enlarging, furnishing or remodeling facilities for any political
526	526	subdivision of the state or any such district. As used in this subsection,
527	527	K.S.A. 12-3418 and 79-3640, and amendments thereto, "funds of a
528	528	political subdivision" shall mean general tax revenues, the proceeds of any
529	529	bonds and gifts or grants-in-aid. Gifts shall not mean funds used for the
530	530	purpose of constructing, equipping, reconstructing, repairing, enlarging,
531	531	furnishing or remodeling facilities that are to be leased to the donor. When
532	532	any political subdivision of the state, district described in subsection (s),
533	533	public or private nonprofit hospital or public hospital authority, public or
534	534	private elementary or secondary school, public or private nonprofit
535	535	educational institution, state correctional institution including a privately
536	536	constructed correctional institution contracted for state use and ownership
537	537	shall contract for the purpose of constructing, equipping, reconstructing,
538	538	maintaining, repairing, enlarging, furnishing or remodeling facilities, it
539	539	shall obtain from the state and furnish to the contractor an exemption
540	540	certificate for the project involved, and the contractor may purchase
541	541	materials for incorporation in such project. The contractor shall furnish the
542	542	number of such certificate to all suppliers from whom such purchases are
543	543	made, and such suppliers shall execute invoices covering the same bearing
544	544	the number of such certificate. Upon completion of the project the
545	545	contractor shall furnish to the political subdivision, district described in
546	546	subsection (s), hospital or public hospital authority, school, educational
547	547	institution or department of corrections concerned a sworn statement, on a
548	548	form to be provided by the director of taxation, that all purchases so made
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592	592	were entitled to exemption under this subsection. As an alternative to the
593	593	foregoing procedure, any such contracting entity may apply to the
594	594	secretary of revenue for agent status for the sole purpose of issuing and
595	595	furnishing project exemption certificates to contractors pursuant to rules
596	596	and regulations adopted by the secretary establishing conditions and
597	597	standards for the granting and maintaining of such status. All invoices
598	598	shall be held by the contractor for a period of five years and shall be
599	599	subject to audit by the director of taxation. If any materials purchased
600	600	under such a certificate are found not to have been incorporated in the
601	601	building or other project or not to have been returned for credit or the sales
602	602	or compensating tax otherwise imposed upon such materials that will not
603	603	be so incorporated in the building or other project reported and paid by
604	604	such contractor to the director of taxation not later than the 20
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606	606	day of the
607	607	month following the close of the month in which it shall be determined
608	608	that such materials will not be used for the purpose for which such
609	609	certificate was issued, the political subdivision, district described in
610	610	subsection (s), hospital or public hospital authority, school, educational
611	611	institution or the contractor contracting with the department of corrections
612	612	for a correctional institution concerned shall be liable for tax on all
613	613	materials purchased for the project, and upon payment thereof it may
614	614	recover the same from the contractor together with reasonable attorney
615	615	fees. Any contractor or any agent, employee or subcontractor thereof, who
616	616	shall use or otherwise dispose of any materials purchased under such a
617	617	certificate for any purpose other than that for which such a certificate is
618	618	issued without the payment of the sales or compensating tax otherwise
619	619	imposed upon such materials, shall be guilty of a misdemeanor and, upon
620	620	conviction therefor, shall be subject to the penalties provided for in K.S.A.
621	621	79-3615(h), and amendments thereto;
622	622	(e) all sales of tangible personal property or services purchased by a
623	623	contractor for the erection, repair or enlargement of buildings or other
624	624	projects for the government of the United States, its agencies or
625	625	instrumentalities, that would be exempt from taxation if purchased directly
626	626	by the government of the United States, its agencies or instrumentalities.
627	627	When the government of the United States, its agencies or
628	628	instrumentalities shall contract for the erection, repair, or enlargement of
629	629	any building or other project, it shall obtain from the state and furnish to
630	630	the contractor an exemption certificate for the project involved, and the
631	631	contractor may purchase materials for incorporation in such project. The
632	632	contractor shall furnish the number of such certificates to all suppliers
633	633	from whom such purchases are made, and such suppliers shall execute
634	634	invoices covering the same bearing the number of such certificate. Upon
635	635	completion of the project the contractor shall furnish to the government of
636	636	the United States, its agencies or instrumentalities concerned a sworn
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638	638	2
639	639	3
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677	677	41
678	678	42
679	679	43 HB 2450 9
680	680	statement, on a form to be provided by the director of taxation, that all
681	681	purchases so made were entitled to exemption under this subsection. As an
682	682	alternative to the foregoing procedure, any such contracting entity may
683	683	apply to the secretary of revenue for agent status for the sole purpose of
684	684	issuing and furnishing project exemption certificates to contractors
685	685	pursuant to rules and regulations adopted by the secretary establishing
686	686	conditions and standards for the granting and maintaining of such status.
687	687	All invoices shall be held by the contractor for a period of five years and
688	688	shall be subject to audit by the director of taxation. Any contractor or any
689	689	agent, employee or subcontractor thereof, who shall use or otherwise
690	690	dispose of any materials purchased under such a certificate for any purpose
691	691	other than that for which such a certificate is issued without the payment
692	692	of the sales or compensating tax otherwise imposed upon such materials,
693	693	shall be guilty of a misdemeanor and, upon conviction therefor, shall be
694	694	subject to the penalties provided for in K.S.A. 79-3615(h), and
695	695	amendments thereto;
696	696	(f) tangible personal property purchased by a railroad or public utility
697	697	for consumption or movement directly and immediately in interstate
698	698	commerce;
699	699	(g) sales of aircraft including remanufactured and modified aircraft
700	700	sold to persons using directly or through an authorized agent such aircraft
701	701	as certified or licensed carriers of persons or property in interstate or
702	702	foreign commerce under authority of the laws of the United States or any
703	703	foreign government or sold to any foreign government or agency or
704	704	instrumentality of such foreign government and all sales of aircraft for use
705	705	outside of the United States and sales of aircraft repair, modification and
706	706	replacement parts and sales of services employed in the remanufacture,
707	707	modification and repair of aircraft;
708	708	(h) all rentals of nonsectarian textbooks by public or private
709	709	elementary or secondary schools;
710	710	(i) the lease or rental of all films, records, tapes, or any type of sound
711	711	or picture transcriptions used by motion picture exhibitors;
712	712	(j) meals served without charge or food used in the preparation of
713	713	such meals to employees of any restaurant, eating house, dining car, hotel,
714	714	drugstore or other place where meals or drinks are regularly sold to the
715	715	public if such employees' duties are related to the furnishing or sale of
716	716	such meals or drinks;
717	717	(k) any motor vehicle, semitrailer or pole trailer, as such terms are
718	718	defined by K.S.A. 8-126, and amendments thereto, or aircraft sold and
719	719	delivered in this state to a bona fide resident of another state, which motor
720	720	vehicle, semitrailer, pole trailer or aircraft is not to be registered or based
721	721	in this state and which vehicle, semitrailer, pole trailer or aircraft will not
722	722	remain in this state more than 10 days;
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765	765	43 HB 2450 10
766	766	(l) all isolated or occasional sales of tangible personal property,
767	767	services, substances or things, except isolated or occasional sale of motor
768	768	vehicles specifically taxed under the provisions of K.S.A. 79-3603(o), and
769	769	amendments thereto;
770	770	(m) all sales of tangible personal property that become an ingredient
771	771	or component part of tangible personal property or services produced,
772	772	manufactured or compounded for ultimate sale at retail within or without
773	773	the state of Kansas; and any such producer, manufacturer or compounder
774	774	may obtain from the director of taxation and furnish to the supplier an
775	775	exemption certificate number for tangible personal property for use as an
776	776	ingredient or component part of the property or services produced,
777	777	manufactured or compounded;
778	778	(n) all sales of tangible personal property that is consumed in the
779	779	production, manufacture, processing, mining, drilling, refining or
780	780	compounding of tangible personal property, the treating of by-products or
781	781	wastes derived from any such production process, the providing of
782	782	services or the irrigation of crops for ultimate sale at retail within or
783	783	without the state of Kansas; and any purchaser of such property may
784	784	obtain from the director of taxation and furnish to the supplier an
785	785	exemption certificate number for tangible personal property for
786	786	consumption in such production, manufacture, processing, mining,
787	787	drilling, refining, compounding, treating, irrigation and in providing such
788	788	services;
789	789	(o) all sales of animals, fowl and aquatic plants and animals, the
790	790	primary purpose of which is use in agriculture or aquaculture, as defined in
791	791	K.S.A. 47-1901, and amendments thereto, the production of food for
792	792	human consumption, the production of animal, dairy, poultry or aquatic
793	793	plant and animal products, fiber or fur, or the production of offspring for
794	794	use for any such purpose or purposes;
795	795	(p) all sales of drugs dispensed pursuant to a prescription order by a
796	796	licensed practitioner or a mid-level practitioner as defined by K.S.A. 65-
797	797	1626, and amendments thereto. As used in this subsection, "drug" means a
798	798	compound, substance or preparation and any component of a compound,
799	799	substance or preparation, other than food and food ingredients, dietary
800	800	supplements or alcoholic beverages, recognized in the official United
801	801	States pharmacopeia, official homeopathic pharmacopoeia of the United
802	802	States or official national formulary, and supplement to any of them,
803	803	intended for use in the diagnosis, cure, mitigation, treatment or prevention
804	804	of disease or intended to affect the structure or any function of the body,
805	805	except that for taxable years commencing after December 31, 2013, this
806	806	subsection shall not apply to any sales of drugs used in the performance or
807	807	induction of an abortion, as defined in K.S.A. 65-6701, and amendments
808	808	thereto;
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851	851	43 HB 2450 11
852	852	(q) all sales of insulin dispensed by a person licensed by the state
853	853	board of pharmacy to a person for treatment of diabetes at the direction of
854	854	a person licensed to practice medicine by the state board of healing arts;
855	855	(r) all sales of oxygen delivery equipment, kidney dialysis equipment,
856	856	enteral feeding systems, prosthetic devices and mobility enhancing
857	857	equipment prescribed in writing by a person licensed to practice the
858	858	healing arts, dentistry or optometry, and in addition to such sales, all sales
859	859	of hearing aids, as defined by K.S.A. 74-5807(c), and amendments thereto,
860	860	and repair and replacement parts therefor, including batteries, by a person
861	861	licensed in the practice of dispensing and fitting hearing aids pursuant to
862	862	the provisions of K.S.A. 74-5808, and amendments thereto. For the
863	863	purposes of this subsection: (1) "Mobility enhancing equipment" means
864	864	equipment including repair and replacement parts to same, but does not
865	865	include durable medical equipment, which is primarily and customarily
866	866	used to provide or increase the ability to move from one place to another
867	867	and which is appropriate for use either in a home or a motor vehicle; is not
868	868	generally used by persons with normal mobility; and does not include any
869	869	motor vehicle or equipment on a motor vehicle normally provided by a
870	870	motor vehicle manufacturer; and (2) "prosthetic device" means a
871	871	replacement, corrective or supportive device including repair and
872	872	replacement parts for same worn on or in the body to artificially replace a
873	873	missing portion of the body, prevent or correct physical deformity or
874	874	malfunction or support a weak or deformed portion of the body;
875	875	(s) except as provided in K.S.A. 82a-2101, and amendments thereto,
876	876	all sales of tangible personal property or services purchased directly or
877	877	indirectly by a groundwater management district organized or operating
878	878	under the authority of K.S.A. 82a-1020 et seq., and amendments thereto,
879	879	by a rural water district organized or operating under the authority of
880	880	K.S.A. 82a-612, and amendments thereto, or by a water supply district
881	881	organized or operating under the authority of K.S.A. 19-3501 et seq., 19-
882	882	3522 et seq. or 19-3545, and amendments thereto, which property or
883	883	services are used in the construction activities, operation or maintenance of
884	884	the district;
885	885	(t) all sales of farm machinery and equipment or aquaculture
886	886	machinery and equipment, repair and replacement parts therefor and
887	887	services performed in the repair and maintenance of such machinery and
888	888	equipment. For the purposes of this subsection the term "farm machinery
889	889	and equipment or aquaculture machinery and equipment" shall include a
890	890	work-site utility vehicle, as defined in K.S.A. 8-126, and amendments
891	891	thereto, and is equipped with a bed or cargo box for hauling materials, and
892	892	shall also include machinery and equipment used in the operation of
893	893	Christmas tree farming but shall not include any passenger vehicle, truck,
894	894	truck tractor, trailer, semitrailer or pole trailer, other than a farm trailer, as
895	895	1
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937	937	43 HB 2450 12
938	938	such terms are defined by K.S.A. 8-126, and amendments thereto. "Farm
939	939	machinery and equipment" includes precision farming equipment that is
940	940	portable or is installed or purchased to be installed on farm machinery and
941	941	equipment. "Precision farming equipment" includes the following items
942	942	used only in computer-assisted farming, ranching or aquaculture
943	943	production operations: Soil testing sensors, yield monitors, computers,
944	944	monitors, software, global positioning and mapping systems, guiding
945	945	systems, modems, data communications equipment and any necessary
946	946	mounting hardware, wiring and antennas. Each purchaser of farm
947	947	machinery and equipment or aquaculture machinery and equipment
948	948	exempted herein must certify in writing on the copy of the invoice or sales
949	949	ticket to be retained by the seller that the farm machinery and equipment
950	950	or aquaculture machinery and equipment purchased will be used only in
951	951	farming, ranching or aquaculture production. Farming or ranching shall
952	952	include the operation of a feedlot and farm and ranch work for hire and the
953	953	operation of a nursery;
954	954	(u) all leases or rentals of tangible personal property used as a
955	955	dwelling if such tangible personal property is leased or rented for a period
956	956	of more than 28 consecutive days;
957	957	(v) all sales of tangible personal property to any contractor for use in
958	958	preparing meals for delivery to homebound elderly persons over 60 years
959	959	of age and to homebound disabled persons or to be served at a group-
960	960	sitting at a location outside of the home to otherwise homebound elderly
961	961	persons over 60 years of age and to otherwise homebound disabled
962	962	persons, as all or part of any food service project funded in whole or in
963	963	part by government or as part of a private nonprofit food service project
964	964	available to all such elderly or disabled persons residing within an area of
965	965	service designated by the private nonprofit organization, and all sales of
966	966	tangible personal property for use in preparing meals for consumption by
967	967	indigent or homeless individuals whether or not such meals are consumed
968	968	at a place designated for such purpose, and all sales of food products by or
969	969	on behalf of any such contractor or organization for any such purpose;
970	970	(w) all sales of natural gas, electricity, heat and water delivered
971	971	through mains, lines or pipes: (1) To residential premises for
972	972	noncommercial use by the occupant of such premises; (2) for agricultural
973	973	use and also, for such use, all sales of propane gas; (3) for use in the
974	974	severing of oil; and (4) to any property which is exempt from property
975	975	taxation pursuant to K.S.A. 79-201b, Second through Sixth. As used in this
976	976	paragraph, "severing" means the same as defined in K.S.A. 79-4216(k),
977	977	and amendments thereto. For all sales of natural gas, electricity and heat
978	978	delivered through mains, lines or pipes pursuant to the provisions of
979	979	subsection (w)(1) and (w)(2), the provisions of this subsection shall expire
980	980	on December 31, 2005;
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1023	1023	43 HB 2450 13
1024	1024	(x) all sales of propane gas, LP-gas, coal, wood and other fuel sources
1025	1025	for the production of heat or lighting for noncommercial use of an
1026	1026	occupant of residential premises occurring prior to January 1, 2006;
1027	1027	(y) all sales of materials and services used in the repairing, servicing,
1028	1028	altering, maintaining, manufacturing, remanufacturing, or modification of
1029	1029	railroad rolling stock for use in interstate or foreign commerce under
1030	1030	authority of the laws of the United States;
1031	1031	(z) all sales of tangible personal property and services purchased
1032	1032	directly by a port authority or by a contractor therefor as provided by the
1033	1033	provisions of K.S.A. 12-3418, and amendments thereto;
1034	1034	(aa) all sales of materials and services applied to equipment that is
1035	1035	transported into the state from without the state for repair, service,
1036	1036	alteration, maintenance, remanufacture or modification and that is
1037	1037	subsequently transported outside the state for use in the transmission of
1038	1038	liquids or natural gas by means of pipeline in interstate or foreign
1039	1039	commerce under authority of the laws of the United States;
1040	1040	(bb) all sales of used mobile homes or manufactured homes. As used
1041	1041	in this subsection: (1) "Mobile homes" and "manufactured homes" mean
1042	1042	the same as defined in K.S.A. 58-4202, and amendments thereto; and (2)
1043	1043	"sales of used mobile homes or manufactured homes" means sales other
1044	1044	than the original retail sale thereof;
1045	1045	(cc) all sales of tangible personal property or services purchased prior
1046	1046	to January 1, 2012, except as otherwise provided, for the purpose of and in
1047	1047	conjunction with constructing, reconstructing, enlarging or remodeling a
1048	1048	business or retail business that meets the requirements established in
1049	1049	K.S.A. 74-50,115, and amendments thereto, and the sale and installation of
1050	1050	machinery and equipment purchased for installation at any such business
1051	1051	or retail business, and all sales of tangible personal property or services
1052	1052	purchased on or after January 1, 2012, for the purpose of and in
1053	1053	conjunction with constructing, reconstructing, enlarging or remodeling a
1054	1054	business that meets the requirements established in K.S.A. 74-50,115(e),
1055	1055	and amendments thereto, and the sale and installation of machinery and
1056	1056	equipment purchased for installation at any such business. When a person
1057	1057	shall contract for the construction, reconstruction, enlargement or
1058	1058	remodeling of any such business or retail business, such person shall
1059	1059	obtain from the state and furnish to the contractor an exemption certificate
1060	1060	for the project involved, and the contractor may purchase materials,
1061	1061	machinery and equipment for incorporation in such project. The contractor
1062	1062	shall furnish the number of such certificates to all suppliers from whom
1063	1063	such purchases are made, and such suppliers shall execute invoices
1064	1064	covering the same bearing the number of such certificate. Upon
1065	1065	completion of the project the contractor shall furnish to the owner of the
1066	1066	business or retail business a sworn statement, on a form to be provided by
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1109	1109	43 HB 2450 14
1110	1110	the director of taxation, that all purchases so made were entitled to
1111	1111	exemption under this subsection. All invoices shall be held by the
1112	1112	contractor for a period of five years and shall be subject to audit by the
1113	1113	director of taxation. Any contractor or any agent, employee or
1114	1114	subcontractor thereof, who shall use or otherwise dispose of any materials,
1115	1115	machinery or equipment purchased under such a certificate for any
1116	1116	purpose other than that for which such a certificate is issued without the
1117	1117	payment of the sales or compensating tax otherwise imposed thereon, shall
1118	1118	be guilty of a misdemeanor and, upon conviction therefor, shall be subject
1119	1119	to the penalties provided for in K.S.A. 79-3615(h), and amendments
1120	1120	thereto. As used in this subsection, "business" and "retail business" mean
1121	1121	the same as defined in K.S.A. 74-50,114, and amendments thereto. Project
1122	1122	exemption certificates that have been previously issued under this
1123	1123	subsection by the department of revenue pursuant to K.S.A. 74-50,115,
1124	1124	and amendments thereto, but not including K.S.A. 74-50,115(e), and
1125	1125	amendments thereto, prior to January 1, 2012, and have not expired will be
1126	1126	effective for the term of the project or two years from the effective date of
1127	1127	the certificate, whichever occurs earlier. Project exemption certificates that
1128	1128	are submitted to the department of revenue prior to January 1, 2012, and
1129	1129	are found to qualify will be issued a project exemption certificate that will
1130	1130	be effective for a two-year period or for the term of the project, whichever
1131	1131	occurs earlier;
1132	1132	(dd) all sales of tangible personal property purchased with food
1133	1133	stamps issued by the United States department of agriculture;
1134	1134	(ee) all sales of lottery tickets and shares made as part of a lottery
1135	1135	operated by the state of Kansas;
1136	1136	(ff) on and after July 1, 1988, all sales of new mobile homes or
1137	1137	manufactured homes to the extent of 40% of the gross receipts, determined
1138	1138	without regard to any trade-in allowance, received from such sale. As used
1139	1139	in this subsection, "mobile homes" and "manufactured homes" mean the
1140	1140	same as defined in K.S.A. 58-4202, and amendments thereto;
1141	1141	(gg) all sales of tangible personal property purchased in accordance
1142	1142	with vouchers issued pursuant to the federal special supplemental food
1143	1143	program for women, infants and children;
1144	1144	(hh) all sales of medical supplies and equipment, including durable
1145	1145	medical equipment, purchased directly by a nonprofit skilled nursing home
1146	1146	or nonprofit intermediate nursing care home, as defined by K.S.A. 39-923,
1147	1147	and amendments thereto, for the purpose of providing medical services to
1148	1148	residents thereof. This exemption shall not apply to tangible personal
1149	1149	property customarily used for human habitation purposes. As used in this
1150	1150	subsection, "durable medical equipment" means equipment including
1151	1151	repair and replacement parts for such equipment, that can withstand
1152	1152	repeated use, is primarily and customarily used to serve a medical purpose,
1153	1153	1
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1196	1196	generally is not useful to a person in the absence of illness or injury and is
1197	1197	not worn in or on the body, but does not include mobility enhancing
1198	1198	equipment as defined in subsection (r), oxygen delivery equipment, kidney
1199	1199	dialysis equipment or enteral feeding systems;
1200	1200	(ii) all sales of tangible personal property purchased directly by a
1201	1201	nonprofit organization for nonsectarian comprehensive multidiscipline
1202	1202	youth development programs and activities provided or sponsored by such
1203	1203	organization, and all sales of tangible personal property by or on behalf of
1204	1204	any such organization. This exemption shall not apply to tangible personal
1205	1205	property customarily used for human habitation purposes;
1206	1206	(jj) all sales of tangible personal property or services, including the
1207	1207	renting and leasing of tangible personal property, purchased directly on
1208	1208	behalf of a community-based facility for people with intellectual disability
1209	1209	or mental health center organized pursuant to K.S.A. 19-4001 et seq., and
1210	1210	amendments thereto, and licensed in accordance with the provisions of
1211	1211	K.S.A. 39-2001 et seq., and amendments thereto, and all sales of tangible
1212	1212	personal property or services purchased by contractors during the time
1213	1213	period from July, 2003, through June, 2006, for the purpose of
1214	1214	constructing, equipping, maintaining or furnishing a new facility for a
1215	1215	community-based facility for people with intellectual disability or mental
1216	1216	health center located in Riverton, Cherokee County, Kansas, that would
1217	1217	have been eligible for sales tax exemption pursuant to this subsection if
1218	1218	purchased directly by such facility or center. This exemption shall not
1219	1219	apply to tangible personal property customarily used for human habitation
1220	1220	purposes;
1221	1221	(kk) (1) (A) all sales of machinery and equipment that are used in this
1222	1222	state as an integral or essential part of an integrated production operation
1223	1223	by a manufacturing or processing plant or facility;
1224	1224	(B) all sales of installation, repair and maintenance services
1225	1225	performed on such machinery and equipment; and
1226	1226	(C) all sales of repair and replacement parts and accessories
1227	1227	purchased for such machinery and equipment.
1228	1228	(2) For purposes of this subsection:
1229	1229	(A) "Integrated production operation" means an integrated series of
1230	1230	operations engaged in at a manufacturing or processing plant or facility to
1231	1231	process, transform or convert tangible personal property by physical,
1232	1232	chemical or other means into a different form, composition or character
1233	1233	from that in which it originally existed. Integrated production operations
1234	1234	shall include: (i) Production line operations, including packaging
1235	1235	operations; (ii) preproduction operations to handle, store and treat raw
1236	1236	materials; (iii) post production handling, storage, warehousing and
1237	1237	distribution operations; and (iv) waste, pollution and environmental
1238	1238	control operations, if any;
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1281	1281	43 HB 2450 16
1282	1282	(B) "production line" means the assemblage of machinery and
1283	1283	equipment at a manufacturing or processing plant or facility where the
1284	1284	actual transformation or processing of tangible personal property occurs;
1285	1285	(C) "manufacturing or processing plant or facility" means a single,
1286	1286	fixed location owned or controlled by a manufacturing or processing
1287	1287	business that consists of one or more structures or buildings in a
1288	1288	contiguous area where integrated production operations are conducted to
1289	1289	manufacture or process tangible personal property to be ultimately sold at
1290	1290	retail. Such term shall not include any facility primarily operated for the
1291	1291	purpose of conveying or assisting in the conveyance of natural gas,
1292	1292	electricity, oil or water. A business may operate one or more manufacturing
1293	1293	or processing plants or facilities at different locations to manufacture or
1294	1294	process a single product of tangible personal property to be ultimately sold
1295	1295	at retail;
1296	1296	(D) "manufacturing or processing business" means a business that
1297	1297	utilizes an integrated production operation to manufacture, process,
1298	1298	fabricate, finish or assemble items for wholesale and retail distribution as
1299	1299	part of what is commonly regarded by the general public as an industrial
1300	1300	manufacturing or processing operation or an agricultural commodity
1301	1301	processing operation. (i) Industrial manufacturing or processing operations
1302	1302	include, by way of illustration but not of limitation, the fabrication of
1303	1303	automobiles, airplanes, machinery or transportation equipment, the
1304	1304	fabrication of metal, plastic, wood or paper products, electricity power
1305	1305	generation, water treatment, petroleum refining, chemical production,
1306	1306	wholesale bottling, newspaper printing, ready mixed concrete production,
1307	1307	and the remanufacturing of used parts for wholesale or retail sale. Such
1308	1308	processing operations shall include operations at an oil well, gas well,
1309	1309	mine or other excavation site where the oil, gas, minerals, coal, clay, stone,
1310	1310	sand or gravel that has been extracted from the earth is cleaned, separated,
1311	1311	crushed, ground, milled, screened, washed or otherwise treated or prepared
1312	1312	before its transmission to a refinery or before any other wholesale or retail
1313	1313	distribution. (ii) Agricultural commodity processing operations include, by
1314	1314	way of illustration but not of limitation, meat packing, poultry slaughtering
1315	1315	and dressing, processing and packaging farm and dairy products in sealed
1316	1316	containers for wholesale and retail distribution, feed grinding, grain
1317	1317	milling, frozen food processing, and grain handling, cleaning, blending,
1318	1318	fumigation, drying and aeration operations engaged in by grain elevators
1319	1319	or other grain storage facilities. (iii) Manufacturing or processing
1320	1320	businesses do not include, by way of illustration but not of limitation,
1321	1321	nonindustrial businesses whose operations are primarily retail and that
1322	1322	produce or process tangible personal property as an incidental part of
1323	1323	conducting the retail business, such as retailers who bake, cook or prepare
1324	1324	food products in the regular course of their retail trade, grocery stores,
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1367	1367	43 HB 2450 17
1368	1368	meat lockers and meat markets that butcher or dress livestock or poultry in
1369	1369	the regular course of their retail trade, contractors who alter, service, repair
1370	1370	or improve real property, and retail businesses that clean, service or
1371	1371	refurbish and repair tangible personal property for its owner;
1372	1372	(E) "repair and replacement parts and accessories" means all parts
1373	1373	and accessories for exempt machinery and equipment, including, but not
1374	1374	limited to, dies, jigs, molds, patterns and safety devices that are attached to
1375	1375	exempt machinery or that are otherwise used in production, and parts and
1376	1376	accessories that require periodic replacement such as belts, drill bits,
1377	1377	grinding wheels, grinding balls, cutting bars, saws, refractory brick and
1378	1378	other refractory items for exempt kiln equipment used in production
1379	1379	operations;
1380	1380	(F) "primary" or "primarily" mean more than 50% of the time.
1381	1381	(3) For purposes of this subsection, machinery and equipment shall
1382	1382	be deemed to be used as an integral or essential part of an integrated
1383	1383	production operation when used to:
1384	1384	(A) Receive, transport, convey, handle, treat or store raw materials in
1385	1385	preparation of its placement on the production line;
1386	1386	(B) transport, convey, handle or store the property undergoing
1387	1387	manufacturing or processing at any point from the beginning of the
1388	1388	production line through any warehousing or distribution operation of the
1389	1389	final product that occurs at the plant or facility;
1390	1390	(C) act upon, effect, promote or otherwise facilitate a physical change
1391	1391	to the property undergoing manufacturing or processing;
1392	1392	(D) guide, control or direct the movement of property undergoing
1393	1393	manufacturing or processing;
1394	1394	(E) test or measure raw materials, the property undergoing
1395	1395	manufacturing or processing or the finished product, as a necessary part of
1396	1396	the manufacturer's integrated production operations;
1397	1397	(F) plan, manage, control or record the receipt and flow of inventories
1398	1398	of raw materials, consumables and component parts, the flow of the
1399	1399	property undergoing manufacturing or processing and the management of
1400	1400	inventories of the finished product;
1401	1401	(G) produce energy for, lubricate, control the operating of or
1402	1402	otherwise enable the functioning of other production machinery and
1403	1403	equipment and the continuation of production operations;
1404	1404	(H) package the property being manufactured or processed in a
1405	1405	container or wrapping in which such property is normally sold or
1406	1406	transported;
1407	1407	(I) transmit or transport electricity, coke, gas, water, steam or similar
1408	1408	substances used in production operations from the point of generation, if
1409	1409	produced by the manufacturer or processor at the plant site, to that
1410	1410	manufacturer's production operation; or, if purchased or delivered from
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1453	1453	43 HB 2450 18
1454	1454	off-site, from the point where the substance enters the site of the plant or
1455	1455	facility to that manufacturer's production operations;
1456	1456	(J) cool, heat, filter, refine or otherwise treat water, steam, acid, oil,
1457	1457	solvents or other substances that are used in production operations;
1458	1458	(K) provide and control an environment required to maintain certain
1459	1459	levels of air quality, humidity or temperature in special and limited areas
1460	1460	of the plant or facility, where such regulation of temperature or humidity is
1461	1461	part of and essential to the production process;
1462	1462	(L) treat, transport or store waste or other byproducts of production
1463	1463	operations at the plant or facility; or
1464	1464	(M) control pollution at the plant or facility where the pollution is
1465	1465	produced by the manufacturing or processing operation.
1466	1466	(4) The following machinery, equipment and materials shall be
1467	1467	deemed to be exempt even though it may not otherwise qualify as
1468	1468	machinery and equipment used as an integral or essential part of an
1469	1469	integrated production operation: (A) Computers and related peripheral
1470	1470	equipment that are utilized by a manufacturing or processing business for
1471	1471	engineering of the finished product or for research and development or
1472	1472	product design; (B) machinery and equipment that is utilized by a
1473	1473	manufacturing or processing business to manufacture or rebuild tangible
1474	1474	personal property that is used in manufacturing or processing operations,
1475	1475	including tools, dies, molds, forms and other parts of qualifying machinery
1476	1476	and equipment; (C) portable plants for aggregate concrete, bulk cement
1477	1477	and asphalt including cement mixing drums to be attached to a motor
1478	1478	vehicle; (D) industrial fixtures, devices, support facilities and special
1479	1479	foundations necessary for manufacturing and production operations, and
1480	1480	materials and other tangible personal property sold for the purpose of
1481	1481	fabricating such fixtures, devices, facilities and foundations. An exemption
1482	1482	certificate for such purchases shall be signed by the manufacturer or
1483	1483	processor. If the fabricator purchases such material, the fabricator shall
1484	1484	also sign the exemption certificate; (E) a manufacturing or processing
1485	1485	business' laboratory equipment that is not located at the plant or facility,
1486	1486	but that would otherwise qualify for exemption under subsection (3)(E);
1487	1487	(F) all machinery and equipment used in surface mining activities as
1488	1488	described in K.S.A. 49-601 et seq., and amendments thereto, beginning
1489	1489	from the time a reclamation plan is filed to the acceptance of the
1490	1490	completed final site reclamation.
1491	1491	(5) "Machinery and equipment used as an integral or essential part of
1492	1492	an integrated production operation" shall not include:
1493	1493	(A) Machinery and equipment used for nonproduction purposes,
1494	1494	including, but not limited to, machinery and equipment used for plant
1495	1495	security, fire prevention, first aid, accounting, administration, record
1496	1496	keeping, advertising, marketing, sales or other related activities, plant
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1539	1539	43 HB 2450 19
1540	1540	cleaning, plant communications and employee work scheduling;
1541	1541	(B) machinery, equipment and tools used primarily in maintaining
1542	1542	and repairing any type of machinery and equipment or the building and
1543	1543	plant;
1544	1544	(C) transportation, transmission and distribution equipment not
1545	1545	primarily used in a production, warehousing or material handling
1546	1546	operation at the plant or facility, including the means of conveyance of
1547	1547	natural gas, electricity, oil or water, and equipment related thereto, located
1548	1548	outside the plant or facility;
1549	1549	(D) office machines and equipment including computers and related
1550	1550	peripheral equipment not used directly and primarily to control or measure
1551	1551	the manufacturing process;
1552	1552	(E) furniture and other furnishings;
1553	1553	(F) buildings, other than exempt machinery and equipment that is
1554	1554	permanently affixed to or becomes a physical part of the building, and any
1555	1555	other part of real estate that is not otherwise exempt;
1556	1556	(G) building fixtures that are not integral to the manufacturing
1557	1557	operation, such as utility systems for heating, ventilation, air conditioning,
1558	1558	communications, plumbing or electrical;
1559	1559	(H) machinery and equipment used for general plant heating, cooling
1560	1560	and lighting;
1561	1561	(I) motor vehicles that are registered for operation on public
1562	1562	highways; or
1563	1563	(J) employee apparel, except safety and protective apparel that is
1564	1564	purchased by an employer and furnished gratuitously to employees who
1565	1565	are involved in production or research activities.
1566	1566	(6) Paragraphs (3) and (5) shall not be construed as exclusive listings
1567	1567	of the machinery and equipment that qualify or do not qualify as an
1568	1568	integral or essential part of an integrated production operation. When
1569	1569	machinery or equipment is used as an integral or essential part of
1570	1570	production operations part of the time and for nonproduction purposes at
1571	1571	other times, the primary use of the machinery or equipment shall
1572	1572	determine whether or not such machinery or equipment qualifies for
1573	1573	exemption.
1574	1574	(7) The secretary of revenue shall adopt rules and regulations
1575	1575	necessary to administer the provisions of this subsection;
1576	1576	(ll) all sales of educational materials purchased for distribution to the
1577	1577	public at no charge by a nonprofit corporation organized for the purpose of
1578	1578	encouraging, fostering and conducting programs for the improvement of
1579	1579	public health, except that for taxable years commencing after December
1580	1580	31, 2013, this subsection shall not apply to any sales of such materials
1581	1581	purchased by a nonprofit corporation which performs any abortion, as
1582	1582	defined in K.S.A. 65-6701, and amendments thereto;
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1625	1625	43 HB 2450 20
1626	1626	(mm) all sales of seeds and tree seedlings; fertilizers, insecticides,
1627	1627	herbicides, germicides, pesticides and fungicides; and services, purchased
1628	1628	and used for the purpose of producing plants in order to prevent soil
1629	1629	erosion on land devoted to agricultural use;
1630	1630	(nn) except as otherwise provided in this act, all sales of services
1631	1631	rendered by an advertising agency or licensed broadcast station or any
1632	1632	member, agent or employee thereof;
1633	1633	(oo) all sales of tangible personal property purchased by a community
1634	1634	action group or agency for the exclusive purpose of repairing or
1635	1635	weatherizing housing occupied by low-income individuals;
1636	1636	(pp) all sales of drill bits and explosives actually utilized in the
1637	1637	exploration and production of oil or gas;
1638	1638	(qq) all sales of tangible personal property and services purchased by
1639	1639	a nonprofit museum or historical society or any combination thereof,
1640	1640	including a nonprofit organization that is organized for the purpose of
1641	1641	stimulating public interest in the exploration of space by providing
1642	1642	educational information, exhibits and experiences, that is exempt from
1643	1643	federal income taxation pursuant to section 501(c)(3) of the federal
1644	1644	internal revenue code of 1986;
1645	1645	(rr) all sales of tangible personal property that will admit the
1646	1646	purchaser thereof to any annual event sponsored by a nonprofit
1647	1647	organization that is exempt from federal income taxation pursuant to
1648	1648	section 501(c)(3) of the federal internal revenue code of 1986, except that
1649	1649	for taxable years commencing after December 31, 2013, this subsection
1650	1650	shall not apply to any sales of such tangible personal property purchased
1651	1651	by a nonprofit organization which performs any abortion, as defined in
1652	1652	K.S.A. 65-6701, and amendments thereto;
1653	1653	(ss) all sales of tangible personal property and services purchased by
1654	1654	a public broadcasting station licensed by the federal communications
1655	1655	commission as a noncommercial educational television or radio station;
1656	1656	(tt) all sales of tangible personal property and services purchased by
1657	1657	or on behalf of a not-for-profit corporation that is exempt from federal
1658	1658	income taxation pursuant to section 501(c)(3) of the federal internal
1659	1659	revenue code of 1986, for the sole purpose of constructing a Kansas
1660	1660	Korean War memorial;
1661	1661	(uu) all sales of tangible personal property and services purchased by
1662	1662	or on behalf of any rural volunteer fire-fighting organization for use
1663	1663	exclusively in the performance of its duties and functions;
1664	1664	(vv) all sales of tangible personal property purchased by any of the
1665	1665	following organizations that are exempt from federal income taxation
1666	1666	pursuant to section 501(c)(3) of the federal internal revenue code of 1986,
1667	1667	for the following purposes, and all sales of any such property by or on
1668	1668	behalf of any such organization for any such purpose:
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1711	1711	43 HB 2450 21
1712	1712	(1) The American heart association, Kansas affiliate, inc. for the
1713	1713	purposes of providing education, training, certification in emergency
1714	1714	cardiac care, research and other related services to reduce disability and
1715	1715	death from cardiovascular diseases and stroke;
1716	1716	(2) the Kansas alliance for the mentally ill, inc. for the purpose of
1717	1717	advocacy for persons with mental illness and to education, research and
1718	1718	support for their families;
1719	1719	(3) the Kansas mental illness awareness council for the purposes of
1720	1720	advocacy for persons who are mentally ill and for education, research and
1721	1721	support for them and their families;
1722	1722	(4) the American diabetes association Kansas affiliate, inc. for the
1723	1723	purpose of eliminating diabetes through medical research, public education
1724	1724	focusing on disease prevention and education, patient education including
1725	1725	information on coping with diabetes, and professional education and
1726	1726	training;
1727	1727	(5) the American lung association of Kansas, inc. for the purpose of
1728	1728	eliminating all lung diseases through medical research, public education
1729	1729	including information on coping with lung diseases, professional education
1730	1730	and training related to lung disease and other related services to reduce the
1731	1731	incidence of disability and death due to lung disease;
1732	1732	(6) the Kansas chapters of the Alzheimer's disease and related
1733	1733	disorders association, inc. for the purpose of providing assistance and
1734	1734	support to persons in Kansas with Alzheimer's disease, and their families
1735	1735	and caregivers;
1736	1736	(7) the Kansas chapters of the Parkinson's disease association for the
1737	1737	purpose of eliminating Parkinson's disease through medical research and
1738	1738	public and professional education related to such disease;
1739	1739	(8) the national kidney foundation of Kansas and western Missouri
1740	1740	for the purpose of eliminating kidney disease through medical research
1741	1741	and public and private education related to such disease;
1742	1742	(9) the heartstrings community foundation for the purpose of
1743	1743	providing training, employment and activities for adults with
1744	1744	developmental disabilities;
1745	1745	(10) the cystic fibrosis foundation, heart of America chapter, for the
1746	1746	purposes of assuring the development of the means to cure and control
1747	1747	cystic fibrosis and improving the quality of life for those with the disease;
1748	1748	(11) the spina bifida association of Kansas for the purpose of
1749	1749	providing financial, educational and practical aid to families and
1750	1750	individuals with spina bifida. Such aid includes, but is not limited to,
1751	1751	funding for medical devices, counseling and medical educational
1752	1752	opportunities;
1753	1753	(12) the CHWC, Inc., for the purpose of rebuilding urban core
1754	1754	neighborhoods through the construction of new homes, acquiring and
1755	1755	1
1756	1756	2
1757	1757	3
1758	1758	4
1759	1759	5
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1785	1785	31
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1787	1787	33
1788	1788	34
1789	1789	35
1790	1790	36
1791	1791	37
1792	1792	38
1793	1793	39
1794	1794	40
1795	1795	41
1796	1796	42
1797	1797	43 HB 2450 22
1798	1798	renovating existing homes and other related activities, and promoting
1799	1799	economic development in such neighborhoods;
1800	1800	(13) the cross-lines cooperative council for the purpose of providing
1801	1801	social services to low income individuals and families;
1802	1802	(14) the dreams work, inc., for the purpose of providing young adult
1803	1803	day services to individuals with developmental disabilities and assisting
1804	1804	families in avoiding institutional or nursing home care for a
1805	1805	developmentally disabled member of their family;
1806	1806	(15) the KSDS, Inc., for the purpose of promoting the independence
1807	1807	and inclusion of people with disabilities as fully participating and
1808	1808	contributing members of their communities and society through the
1809	1809	training and providing of guide and service dogs to people with
1810	1810	disabilities, and providing disability education and awareness to the
1811	1811	general public;
1812	1812	(16) the lyme association of greater Kansas City, Inc., for the purpose
1813	1813	of providing support to persons with lyme disease and public education
1814	1814	relating to the prevention, treatment and cure of lyme disease;
1815	1815	(17) the dream factory, inc., for the purpose of granting the dreams of
1816	1816	children with critical and chronic illnesses;
1817	1817	(18) the Ottawa Suzuki strings, inc., for the purpose of providing
1818	1818	students and families with education and resources necessary to enable
1819	1819	each child to develop fine character and musical ability to the fullest
1820	1820	potential;
1821	1821	(19) the international association of lions clubs for the purpose of
1822	1822	creating and fostering a spirit of understanding among all people for
1823	1823	humanitarian needs by providing voluntary services through community
1824	1824	involvement and international cooperation;
1825	1825	(20) the Johnson county young matrons, inc., for the purpose of
1826	1826	promoting a positive future for members of the community through
1827	1827	volunteerism, financial support and education through the efforts of an all
1828	1828	volunteer organization;
1829	1829	(21) the American cancer society, inc., for the purpose of eliminating
1830	1830	cancer as a major health problem by preventing cancer, saving lives and
1831	1831	diminishing suffering from cancer, through research, education, advocacy
1832	1832	and service;
1833	1833	(22) the community services of Shawnee, inc., for the purpose of
1834	1834	providing food and clothing to those in need;
1835	1835	(23) the angel babies association, for the purpose of providing
1836	1836	assistance, support and items of necessity to teenage mothers and their
1837	1837	babies; and
1838	1838	(24) the Kansas fairgrounds foundation for the purpose of the
1839	1839	preservation, renovation and beautification of the Kansas state fairgrounds;
1840	1840	(ww) all sales of tangible personal property purchased by the habitat
1841	1841	1
1842	1842	2
1843	1843	3
1844	1844	4
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1871	1871	31
1872	1872	32
1873	1873	33
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1875	1875	35
1876	1876	36
1877	1877	37
1878	1878	38
1879	1879	39
1880	1880	40
1881	1881	41
1882	1882	42
1883	1883	43 HB 2450 23
1884	1884	for humanity for the exclusive use of being incorporated within a housing
1885	1885	project constructed by such organization;
1886	1886	(xx) all sales of tangible personal property and services purchased by
1887	1887	a nonprofit zoo that is exempt from federal income taxation pursuant to
1888	1888	section 501(c)(3) of the federal internal revenue code of 1986, or on behalf
1889	1889	of such zoo by an entity itself exempt from federal income taxation
1890	1890	pursuant to section 501(c)(3) of the federal internal revenue code of 1986
1891	1891	contracted with to operate such zoo and all sales of tangible personal
1892	1892	property or services purchased by a contractor for the purpose of
1893	1893	constructing, equipping, reconstructing, maintaining, repairing, enlarging,
1894	1894	furnishing or remodeling facilities for any nonprofit zoo that would be
1895	1895	exempt from taxation under the provisions of this section if purchased
1896	1896	directly by such nonprofit zoo or the entity operating such zoo. Nothing in
1897	1897	this subsection shall be deemed to exempt the purchase of any construction
1898	1898	machinery, equipment or tools used in the constructing, equipping,
1899	1899	reconstructing, maintaining, repairing, enlarging, furnishing or remodeling
1900	1900	facilities for any nonprofit zoo. When any nonprofit zoo shall contract for
1901	1901	the purpose of constructing, equipping, reconstructing, maintaining,
1902	1902	repairing, enlarging, furnishing or remodeling facilities, it shall obtain
1903	1903	from the state and furnish to the contractor an exemption certificate for the
1904	1904	project involved, and the contractor may purchase materials for
1905	1905	incorporation in such project. The contractor shall furnish the number of
1906	1906	such certificate to all suppliers from whom such purchases are made, and
1907	1907	such suppliers shall execute invoices covering the same bearing the
1908	1908	number of such certificate. Upon completion of the project the contractor
1909	1909	shall furnish to the nonprofit zoo concerned a sworn statement, on a form
1910	1910	to be provided by the director of taxation, that all purchases so made were
1911	1911	entitled to exemption under this subsection. All invoices shall be held by
1912	1912	the contractor for a period of five years and shall be subject to audit by the
1913	1913	director of taxation. If any materials purchased under such a certificate are
1914	1914	found not to have been incorporated in the building or other project or not
1915	1915	to have been returned for credit or the sales or compensating tax otherwise
1916	1916	imposed upon such materials that will not be so incorporated in the
1917	1917	building or other project reported and paid by such contractor to the
1918	1918	director of taxation not later than the 20
1919	1919	th
1920	1920	day of the month following the
1921	1921	close of the month in which it shall be determined that such materials will
1922	1922	not be used for the purpose for which such certificate was issued, the
1923	1923	nonprofit zoo concerned shall be liable for tax on all materials purchased
1924	1924	for the project, and upon payment thereof it may recover the same from
1925	1925	the contractor together with reasonable attorney fees. Any contractor or
1926	1926	any agent, employee or subcontractor thereof, who shall use or otherwise
1927	1927	dispose of any materials purchased under such a certificate for any purpose
1928	1928	other than that for which such a certificate is issued without the payment
1929	1929	1
1930	1930	2
1931	1931	3
1932	1932	4
1933	1933	5
1934	1934	6
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1963	1963	35
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1965	1965	37
1966	1966	38
1967	1967	39
1968	1968	40
1969	1969	41
1970	1970	42
1971	1971	43 HB 2450 24
1972	1972	of the sales or compensating tax otherwise imposed upon such materials,
1973	1973	shall be guilty of a misdemeanor and, upon conviction therefor, shall be
1974	1974	subject to the penalties provided for in K.S.A. 79-3615(h), and
1975	1975	amendments thereto;
1976	1976	(yy) all sales of tangible personal property and services purchased by
1977	1977	a parent-teacher association or organization, and all sales of tangible
1978	1978	personal property by or on behalf of such association or organization;
1979	1979	(zz) all sales of machinery and equipment purchased by over-the-air,
1980	1980	free access radio or television station that is used directly and primarily for
1981	1981	the purpose of producing a broadcast signal or is such that the failure of
1982	1982	the machinery or equipment to operate would cause broadcasting to cease.
1983	1983	For purposes of this subsection, machinery and equipment shall include,
1984	1984	but not be limited to, that required by rules and regulations of the federal
1985	1985	communications commission, and all sales of electricity which are
1986	1986	essential or necessary for the purpose of producing a broadcast signal or is
1987	1987	such that the failure of the electricity would cause broadcasting to cease;
1988	1988	(aaa) all sales of tangible personal property and services purchased by
1989	1989	a religious organization that is exempt from federal income taxation
1990	1990	pursuant to section 501(c)(3) of the federal internal revenue code, and used
1991	1991	exclusively for religious purposes, and all sales of tangible personal
1992	1992	property or services purchased by a contractor for the purpose of
1993	1993	constructing, equipping, reconstructing, maintaining, repairing, enlarging,
1994	1994	furnishing or remodeling facilities for any such organization that would be
1995	1995	exempt from taxation under the provisions of this section if purchased
1996	1996	directly by such organization. Nothing in this subsection shall be deemed
1997	1997	to exempt the purchase of any construction machinery, equipment or tools
1998	1998	used in the constructing, equipping, reconstructing, maintaining, repairing,
1999	1999	enlarging, furnishing or remodeling facilities for any such organization.
2000	2000	When any such organization shall contract for the purpose of constructing,
2001	2001	equipping, reconstructing, maintaining, repairing, enlarging, furnishing or
2002	2002	remodeling facilities, it shall obtain from the state and furnish to the
2003	2003	contractor an exemption certificate for the project involved, and the
2004	2004	contractor may purchase materials for incorporation in such project. The
2005	2005	contractor shall furnish the number of such certificate to all suppliers from
2006	2006	whom such purchases are made, and such suppliers shall execute invoices
2007	2007	covering the same bearing the number of such certificate. Upon
2008	2008	completion of the project the contractor shall furnish to such organization
2009	2009	concerned a sworn statement, on a form to be provided by the director of
2010	2010	taxation, that all purchases so made were entitled to exemption under this
2011	2011	subsection. All invoices shall be held by the contractor for a period of five
2012	2012	years and shall be subject to audit by the director of taxation. If any
2013	2013	materials purchased under such a certificate are found not to have been
2014	2014	incorporated in the building or other project or not to have been returned
2015	2015	1
2016	2016	2
2017	2017	3
2018	2018	4
2019	2019	5
2020	2020	6
2021	2021	7
2022	2022	8
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2026	2026	12
2027	2027	13
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2054	2054	40
2055	2055	41
2056	2056	42
2057	2057	43 HB 2450 25
2058	2058	for credit or the sales or compensating tax otherwise imposed upon such
2059	2059	materials that will not be so incorporated in the building or other project
2060	2060	reported and paid by such contractor to the director of taxation not later
2061	2061	than the 20
2062	2062	th
2063	2063	day of the month following the close of the month in which it
2064	2064	shall be determined that such materials will not be used for the purpose for
2065	2065	which such certificate was issued, such organization concerned shall be
2066	2066	liable for tax on all materials purchased for the project, and upon payment
2067	2067	thereof it may recover the same from the contractor together with
2068	2068	reasonable attorney fees. Any contractor or any agent, employee or
2069	2069	subcontractor thereof, who shall use or otherwise dispose of any materials
2070	2070	purchased under such a certificate for any purpose other than that for
2071	2071	which such a certificate is issued without the payment of the sales or
2072	2072	compensating tax otherwise imposed upon such materials, shall be guilty
2073	2073	of a misdemeanor and, upon conviction therefor, shall be subject to the
2074	2074	penalties provided for in K.S.A. 79-3615(h), and amendments thereto.
2075	2075	Sales tax paid on and after July 1, 1998, but prior to the effective date of
2076	2076	this act upon the gross receipts received from any sale exempted by the
2077	2077	amendatory provisions of this subsection shall be refunded. Each claim for
2078	2078	a sales tax refund shall be verified and submitted to the director of taxation
2079	2079	upon forms furnished by the director and shall be accompanied by any
2080	2080	additional documentation required by the director. The director shall
2081	2081	review each claim and shall refund that amount of sales tax paid as
2082	2082	determined under the provisions of this subsection. All refunds shall be
2083	2083	paid from the sales tax refund fund upon warrants of the director of
2084	2084	accounts and reports pursuant to vouchers approved by the director or the
2085	2085	director's designee;
2086	2086	(bbb) all sales of food for human consumption by an organization that
2087	2087	is exempt from federal income taxation pursuant to section 501(c)(3) of
2088	2088	the federal internal revenue code of 1986, pursuant to a food distribution
2089	2089	program that offers such food at a price below cost in exchange for the
2090	2090	performance of community service by the purchaser thereof;
2091	2091	(ccc) on and after July 1, 1999, all sales of tangible personal property
2092	2092	and services purchased by a primary care clinic or health center the
2093	2093	primary purpose of which is to provide services to medically underserved
2094	2094	individuals and families, and that is exempt from federal income taxation
2095	2095	pursuant to section 501(c)(3) of the federal internal revenue code, and all
2096	2096	sales of tangible personal property or services purchased by a contractor
2097	2097	for the purpose of constructing, equipping, reconstructing, maintaining,
2098	2098	repairing, enlarging, furnishing or remodeling facilities for any such clinic
2099	2099	or center that would be exempt from taxation under the provisions of this
2100	2100	section if purchased directly by such clinic or center, except that for
2101	2101	taxable years commencing after December 31, 2013, this subsection shall
2102	2102	not apply to any sales of such tangible personal property and services
2103	2103	1
2104	2104	2
2105	2105	3
2106	2106	4
2107	2107	5
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2109	2109	7
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2133	2133	31
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2137	2137	35
2138	2138	36
2139	2139	37
2140	2140	38
2141	2141	39
2142	2142	40
2143	2143	41
2144	2144	42
2145	2145	43 HB 2450 26
2146	2146	purchased by a primary care clinic or health center which performs any
2147	2147	abortion, as defined in K.S.A. 65-6701, and amendments thereto. Nothing
2148	2148	in this subsection shall be deemed to exempt the purchase of any
2149	2149	construction machinery, equipment or tools used in the constructing,
2150	2150	equipping, reconstructing, maintaining, repairing, enlarging, furnishing or
2151	2151	remodeling facilities for any such clinic or center. When any such clinic or
2152	2152	center shall contract for the purpose of constructing, equipping,
2153	2153	reconstructing, maintaining, repairing, enlarging, furnishing or remodeling
2154	2154	facilities, it shall obtain from the state and furnish to the contractor an
2155	2155	exemption certificate for the project involved, and the contractor may
2156	2156	purchase materials for incorporation in such project. The contractor shall
2157	2157	furnish the number of such certificate to all suppliers from whom such
2158	2158	purchases are made, and such suppliers shall execute invoices covering the
2159	2159	same bearing the number of such certificate. Upon completion of the
2160	2160	project the contractor shall furnish to such clinic or center concerned a
2161	2161	sworn statement, on a form to be provided by the director of taxation, that
2162	2162	all purchases so made were entitled to exemption under this subsection.
2163	2163	All invoices shall be held by the contractor for a period of five years and
2164	2164	shall be subject to audit by the director of taxation. If any materials
2165	2165	purchased under such a certificate are found not to have been incorporated
2166	2166	in the building or other project or not to have been returned for credit or
2167	2167	the sales or compensating tax otherwise imposed upon such materials that
2168	2168	will not be so incorporated in the building or other project reported and
2169	2169	paid by such contractor to the director of taxation not later than the 20
2170	2170	th
2171	2171	day of the month following the close of the month in which it shall be
2172	2172	determined that such materials will not be used for the purpose for which
2173	2173	such certificate was issued, such clinic or center concerned shall be liable
2174	2174	for tax on all materials purchased for the project, and upon payment
2175	2175	thereof it may recover the same from the contractor together with
2176	2176	reasonable attorney fees. Any contractor or any agent, employee or
2177	2177	subcontractor thereof, who shall use or otherwise dispose of any materials
2178	2178	purchased under such a certificate for any purpose other than that for
2179	2179	which such a certificate is issued without the payment of the sales or
2180	2180	compensating tax otherwise imposed upon such materials, shall be guilty
2181	2181	of a misdemeanor and, upon conviction therefor, shall be subject to the
2182	2182	penalties provided for in K.S.A. 79-3615(h), and amendments thereto;
2183	2183	(ddd) on and after January 1, 1999, and before January 1, 2000, all
2184	2184	sales of materials and services purchased by any class II or III railroad as
2185	2185	classified by the federal surface transportation board for the construction,
2186	2186	renovation, repair or replacement of class II or III railroad track and
2187	2187	facilities used directly in interstate commerce. In the event any such track
2188	2188	or facility for which materials and services were purchased sales tax
2189	2189	exempt is not operational for five years succeeding the allowance of such
2190	2190	1
2191	2191	2
2192	2192	3
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2229	2229	40
2230	2230	41
2231	2231	42
2232	2232	43 HB 2450 27
2233	2233	exemption, the total amount of sales tax that would have been payable
2234	2234	except for the operation of this subsection shall be recouped in accordance
2235	2235	with rules and regulations adopted for such purpose by the secretary of
2236	2236	revenue;
2237	2237	(eee) on and after January 1, 1999, and before January 1, 2001, all
2238	2238	sales of materials and services purchased for the original construction,
2239	2239	reconstruction, repair or replacement of grain storage facilities, including
2240	2240	railroad sidings providing access thereto;
2241	2241	(fff) all sales of material handling equipment, racking systems and
2242	2242	other related machinery and equipment that is used for the handling,
2243	2243	movement or storage of tangible personal property in a warehouse or
2244	2244	distribution facility in this state; all sales of installation, repair and
2245	2245	maintenance services performed on such machinery and equipment; and
2246	2246	all sales of repair and replacement parts for such machinery and
2247	2247	equipment. For purposes of this subsection, a warehouse or distribution
2248	2248	facility means a single, fixed location that consists of buildings or
2249	2249	structures in a contiguous area where storage or distribution operations are
2250	2250	conducted that are separate and apart from the business' retail operations,
2251	2251	if any, and that do not otherwise qualify for exemption as occurring at a
2252	2252	manufacturing or processing plant or facility. Material handling and
2253	2253	storage equipment shall include aeration, dust control, cleaning, handling
2254	2254	and other such equipment that is used in a public grain warehouse or other
2255	2255	commercial grain storage facility, whether used for grain handling, grain
2256	2256	storage, grain refining or processing, or other grain treatment operation;
2257	2257	(ggg) all sales of tangible personal property and services purchased
2258	2258	by or on behalf of the Kansas academy of science, which is exempt from
2259	2259	federal income taxation pursuant to section 501(c)(3) of the federal
2260	2260	internal revenue code of 1986, and used solely by such academy for the
2261	2261	preparation, publication and dissemination of education materials;
2262	2262	(hhh) all sales of tangible personal property and services purchased
2263	2263	by or on behalf of all domestic violence shelters that are member agencies
2264	2264	of the Kansas coalition against sexual and domestic violence;
2265	2265	(iii) all sales of personal property and services purchased by an
2266	2266	organization that is exempt from federal income taxation pursuant to
2267	2267	section 501(c)(3) of the federal internal revenue code of 1986, and such
2268	2268	personal property and services are used by any such organization in the
2269	2269	collection, storage and distribution of food products to nonprofit
2270	2270	organizations that distribute such food products to persons pursuant to a
2271	2271	food distribution program on a charitable basis without fee or charge, and
2272	2272	all sales of tangible personal property or services purchased by a
2273	2273	contractor for the purpose of constructing, equipping, reconstructing,
2274	2274	maintaining, repairing, enlarging, furnishing or remodeling facilities used
2275	2275	for the collection and storage of such food products for any such
2276	2276	1
2277	2277	2
2278	2278	3
2279	2279	4
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2314	2314	39
2315	2315	40
2316	2316	41
2317	2317	42
2318	2318	43 HB 2450 28
2319	2319	organization which is exempt from federal income taxation pursuant to
2320	2320	section 501(c)(3) of the federal internal revenue code of 1986, that would
2321	2321	be exempt from taxation under the provisions of this section if purchased
2322	2322	directly by such organization. Nothing in this subsection shall be deemed
2323	2323	to exempt the purchase of any construction machinery, equipment or tools
2324	2324	used in the constructing, equipping, reconstructing, maintaining, repairing,
2325	2325	enlarging, furnishing or remodeling facilities for any such organization.
2326	2326	When any such organization shall contract for the purpose of constructing,
2327	2327	equipping, reconstructing, maintaining, repairing, enlarging, furnishing or
2328	2328	remodeling facilities, it shall obtain from the state and furnish to the
2329	2329	contractor an exemption certificate for the project involved, and the
2330	2330	contractor may purchase materials for incorporation in such project. The
2331	2331	contractor shall furnish the number of such certificate to all suppliers from
2332	2332	whom such purchases are made, and such suppliers shall execute invoices
2333	2333	covering the same bearing the number of such certificate. Upon
2334	2334	completion of the project the contractor shall furnish to such organization
2335	2335	concerned a sworn statement, on a form to be provided by the director of
2336	2336	taxation, that all purchases so made were entitled to exemption under this
2337	2337	subsection. All invoices shall be held by the contractor for a period of five
2338	2338	years and shall be subject to audit by the director of taxation. If any
2339	2339	materials purchased under such a certificate are found not to have been
2340	2340	incorporated in such facilities or not to have been returned for credit or the
2341	2341	sales or compensating tax otherwise imposed upon such materials that will
2342	2342	not be so incorporated in such facilities reported and paid by such
2343	2343	contractor to the director of taxation not later than the 20
2344	2344	th
2345	2345	day of the
2346	2346	month following the close of the month in which it shall be determined
2347	2347	that such materials will not be used for the purpose for which such
2348	2348	certificate was issued, such organization concerned shall be liable for tax
2349	2349	on all materials purchased for the project, and upon payment thereof it
2350	2350	may recover the same from the contractor together with reasonable
2351	2351	attorney fees. Any contractor or any agent, employee or subcontractor
2352	2352	thereof, who shall use or otherwise dispose of any materials purchased
2353	2353	under such a certificate for any purpose other than that for which such a
2354	2354	certificate is issued without the payment of the sales or compensating tax
2355	2355	otherwise imposed upon such materials, shall be guilty of a misdemeanor
2356	2356	and, upon conviction therefor, shall be subject to the penalties provided for
2357	2357	in K.S.A. 79-3615(h), and amendments thereto. Sales tax paid on and after
2358	2358	July 1, 2005, but prior to the effective date of this act upon the gross
2359	2359	receipts received from any sale exempted by the amendatory provisions of
2360	2360	this subsection shall be refunded. Each claim for a sales tax refund shall be
2361	2361	verified and submitted to the director of taxation upon forms furnished by
2362	2362	the director and shall be accompanied by any additional documentation
2363	2363	required by the director. The director shall review each claim and shall
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2403	2403	40
2404	2404	41
2405	2405	42
2406	2406	43 HB 2450 29
2407	2407	refund that amount of sales tax paid as determined under the provisions of
2408	2408	this subsection. All refunds shall be paid from the sales tax refund fund
2409	2409	upon warrants of the director of accounts and reports pursuant to vouchers
2410	2410	approved by the director or the director's designee;
2411	2411	(jjj) all sales of dietary supplements dispensed pursuant to a
2412	2412	prescription order by a licensed practitioner or a mid-level practitioner as
2413	2413	defined by K.S.A. 65-1626, and amendments thereto. As used in this
2414	2414	subsection, "dietary supplement" means any product, other than tobacco,
2415	2415	intended to supplement the diet that: (1) Contains one or more of the
2416	2416	following dietary ingredients: A vitamin, a mineral, an herb or other
2417	2417	botanical, an amino acid, a dietary substance for use by humans to
2418	2418	supplement the diet by increasing the total dietary intake or a concentrate,
2419	2419	metabolite, constituent, extract or combination of any such ingredient; (2)
2420	2420	is intended for ingestion in tablet, capsule, powder, softgel, gelcap or
2421	2421	liquid form, or if not intended for ingestion, in such a form, is not
2422	2422	represented as conventional food and is not represented for use as a sole
2423	2423	item of a meal or of the diet; and (3) is required to be labeled as a dietary
2424	2424	supplement, identifiable by the supplemental facts box found on the label
2425	2425	and as required pursuant to 21 C.F.R. § 101.36;
2426	2426	(lll) all sales of tangible personal property and services purchased by
2427	2427	special olympics Kansas, inc. for the purpose of providing year-round
2428	2428	sports training and athletic competition in a variety of olympic-type sports
2429	2429	for individuals with intellectual disabilities by giving them continuing
2430	2430	opportunities to develop physical fitness, demonstrate courage, experience
2431	2431	joy and participate in a sharing of gifts, skills and friendship with their
2432	2432	families, other special olympics athletes and the community, and activities
2433	2433	provided or sponsored by such organization, and all sales of tangible
2434	2434	personal property by or on behalf of any such organization;
2435	2435	(mmm) all sales of tangible personal property purchased by or on
2436	2436	behalf of the Marillac center, inc., which is exempt from federal income
2437	2437	taxation pursuant to section 501(c)(3) of the federal internal revenue code,
2438	2438	for the purpose of providing psycho-social-biological and special
2439	2439	education services to children, and all sales of any such property by or on
2440	2440	behalf of such organization for such purpose;
2441	2441	(nnn) all sales of tangible personal property and services purchased
2442	2442	by the west Sedgwick county-sunrise rotary club and sunrise charitable
2443	2443	fund for the purpose of constructing a boundless playground which is an
2444	2444	integrated, barrier free and developmentally advantageous play
2445	2445	environment for children of all abilities and disabilities;
2446	2446	(ooo) all sales of tangible personal property by or on behalf of a
2447	2447	public library serving the general public and supported in whole or in part
2448	2448	with tax money or a not-for-profit organization whose purpose is to raise
2449	2449	funds for or provide services or other benefits to any such public library;
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2486	2486	37
2487	2487	38
2488	2488	39
2489	2489	40
2490	2490	41
2491	2491	42
2492	2492	43 HB 2450 30
2493	2493	(ppp) all sales of tangible personal property and services purchased
2494	2494	by or on behalf of a homeless shelter that is exempt from federal income
2495	2495	taxation pursuant to section 501(c)(3) of the federal income tax code of
2496	2496	1986, and used by any such homeless shelter to provide emergency and
2497	2497	transitional housing for individuals and families experiencing
2498	2498	homelessness, and all sales of any such property by or on behalf of any
2499	2499	such homeless shelter for any such purpose;
2500	2500	(qqq) all sales of tangible personal property and services purchased
2501	2501	by TLC for children and families, inc., hereinafter referred to as TLC,
2502	2502	which is exempt from federal income taxation pursuant to section 501(c)
2503	2503	(3) of the federal internal revenue code of 1986, and such property and
2504	2504	services are used for the purpose of providing emergency shelter and
2505	2505	treatment for abused and neglected children as well as meeting additional
2506	2506	critical needs for children, juveniles and family, and all sales of any such
2507	2507	property by or on behalf of TLC for any such purpose; and all sales of
2508	2508	tangible personal property or services purchased by a contractor for the
2509	2509	purpose of constructing, maintaining, repairing, enlarging, furnishing or
2510	2510	remodeling facilities for the operation of services for TLC for any such
2511	2511	purpose that would be exempt from taxation under the provisions of this
2512	2512	section if purchased directly by TLC. Nothing in this subsection shall be
2513	2513	deemed to exempt the purchase of any construction machinery, equipment
2514	2514	or tools used in the constructing, maintaining, repairing, enlarging,
2515	2515	furnishing or remodeling such facilities for TLC. When TLC contracts for
2516	2516	the purpose of constructing, maintaining, repairing, enlarging, furnishing
2517	2517	or remodeling such facilities, it shall obtain from the state and furnish to
2518	2518	the contractor an exemption certificate for the project involved, and the
2519	2519	contractor may purchase materials for incorporation in such project. The
2520	2520	contractor shall furnish the number of such certificate to all suppliers from
2521	2521	whom such purchases are made, and such suppliers shall execute invoices
2522	2522	covering the same bearing the number of such certificate. Upon
2523	2523	completion of the project the contractor shall furnish to TLC a sworn
2524	2524	statement, on a form to be provided by the director of taxation, that all
2525	2525	purchases so made were entitled to exemption under this subsection. All
2526	2526	invoices shall be held by the contractor for a period of five years and shall
2527	2527	be subject to audit by the director of taxation. If any materials purchased
2528	2528	under such a certificate are found not to have been incorporated in the
2529	2529	building or other project or not to have been returned for credit or the sales
2530	2530	or compensating tax otherwise imposed upon such materials that will not
2531	2531	be so incorporated in the building or other project reported and paid by
2532	2532	such contractor to the director of taxation not later than the 20
2533	2533	th
2534	2534	day of the
2535	2535	month following the close of the month in which it shall be determined
2536	2536	that such materials will not be used for the purpose for which such
2537	2537	certificate was issued, TLC shall be liable for tax on all materials
2538	2538	1
2539	2539	2
2540	2540	3
2541	2541	4
2542	2542	5
2543	2543	6
2544	2544	7
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2550	2550	13
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2577	2577	40
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2579	2579	42
2580	2580	43 HB 2450 31
2581	2581	purchased for the project, and upon payment thereof it may recover the
2582	2582	same from the contractor together with reasonable attorney fees. Any
2583	2583	contractor or any agent, employee or subcontractor thereof, who shall use
2584	2584	or otherwise dispose of any materials purchased under such a certificate
2585	2585	for any purpose other than that for which such a certificate is issued
2586	2586	without the payment of the sales or compensating tax otherwise imposed
2587	2587	upon such materials, shall be guilty of a misdemeanor and, upon
2588	2588	conviction therefor, shall be subject to the penalties provided for in K.S.A.
2589	2589	79-3615(h), and amendments thereto;
2590	2590	(rrr) all sales of tangible personal property and services purchased by
2591	2591	any county law library maintained pursuant to law and sales of tangible
2592	2592	personal property and services purchased by an organization that would
2593	2593	have been exempt from taxation under the provisions of this subsection if
2594	2594	purchased directly by the county law library for the purpose of providing
2595	2595	legal resources to attorneys, judges, students and the general public, and
2596	2596	all sales of any such property by or on behalf of any such county law
2597	2597	library;
2598	2598	(sss) all sales of tangible personal property and services purchased by
2599	2599	catholic charities or youthville, hereinafter referred to as charitable family
2600	2600	providers, which is exempt from federal income taxation pursuant to
2601	2601	section 501(c)(3) of the federal internal revenue code of 1986, and which
2602	2602	such property and services are used for the purpose of providing
2603	2603	emergency shelter and treatment for abused and neglected children as well
2604	2604	as meeting additional critical needs for children, juveniles and family, and
2605	2605	all sales of any such property by or on behalf of charitable family
2606	2606	providers for any such purpose; and all sales of tangible personal property
2607	2607	or services purchased by a contractor for the purpose of constructing,
2608	2608	maintaining, repairing, enlarging, furnishing or remodeling facilities for
2609	2609	the operation of services for charitable family providers for any such
2610	2610	purpose which would be exempt from taxation under the provisions of this
2611	2611	section if purchased directly by charitable family providers. Nothing in
2612	2612	this subsection shall be deemed to exempt the purchase of any construction
2613	2613	machinery, equipment or tools used in the constructing, maintaining,
2614	2614	repairing, enlarging, furnishing or remodeling such facilities for charitable
2615	2615	family providers. When charitable family providers contracts for the
2616	2616	purpose of constructing, maintaining, repairing, enlarging, furnishing or
2617	2617	remodeling such facilities, it shall obtain from the state and furnish to the
2618	2618	contractor an exemption certificate for the project involved, and the
2619	2619	contractor may purchase materials for incorporation in such project. The
2620	2620	contractor shall furnish the number of such certificate to all suppliers from
2621	2621	whom such purchases are made, and such suppliers shall execute invoices
2622	2622	covering the same bearing the number of such certificate. Upon
2623	2623	completion of the project the contractor shall furnish to charitable family
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2666	2666	43 HB 2450 32
2667	2667	providers a sworn statement, on a form to be provided by the director of
2668	2668	taxation, that all purchases so made were entitled to exemption under this
2669	2669	subsection. All invoices shall be held by the contractor for a period of five
2670	2670	years and shall be subject to audit by the director of taxation. If any
2671	2671	materials purchased under such a certificate are found not to have been
2672	2672	incorporated in the building or other project or not to have been returned
2673	2673	for credit or the sales or compensating tax otherwise imposed upon such
2674	2674	materials that will not be so incorporated in the building or other project
2675	2675	reported and paid by such contractor to the director of taxation not later
2676	2676	than the 20
2677	2677	th
2678	2678	day of the month following the close of the month in which it
2679	2679	shall be determined that such materials will not be used for the purpose for
2680	2680	which such certificate was issued, charitable family providers shall be
2681	2681	liable for tax on all materials purchased for the project, and upon payment
2682	2682	thereof it may recover the same from the contractor together with
2683	2683	reasonable attorney fees. Any contractor or any agent, employee or
2684	2684	subcontractor thereof, who shall use or otherwise dispose of any materials
2685	2685	purchased under such a certificate for any purpose other than that for
2686	2686	which such a certificate is issued without the payment of the sales or
2687	2687	compensating tax otherwise imposed upon such materials, shall be guilty
2688	2688	of a misdemeanor and, upon conviction therefor, shall be subject to the
2689	2689	penalties provided for in K.S.A. 79-3615(h), and amendments thereto;
2690	2690	(ttt) all sales of tangible personal property or services purchased by a
2691	2691	contractor for a project for the purpose of restoring, constructing,
2692	2692	equipping, reconstructing, maintaining, repairing, enlarging, furnishing or
2693	2693	remodeling a home or facility owned by a nonprofit museum that has been
2694	2694	granted an exemption pursuant to subsection (qq), which such home or
2695	2695	facility is located in a city that has been designated as a qualified
2696	2696	hometown pursuant to the provisions of K.S.A. 75-5071 et seq., and
2697	2697	amendments thereto, and which such project is related to the purposes of
2698	2698	K.S.A. 75-5071 et seq., and amendments thereto, and that would be
2699	2699	exempt from taxation under the provisions of this section if purchased
2700	2700	directly by such nonprofit museum. Nothing in this subsection shall be
2701	2701	deemed to exempt the purchase of any construction machinery, equipment
2702	2702	or tools used in the restoring, constructing, equipping, reconstructing,
2703	2703	maintaining, repairing, enlarging, furnishing or remodeling a home or
2704	2704	facility for any such nonprofit museum. When any such nonprofit museum
2705	2705	shall contract for the purpose of restoring, constructing, equipping,
2706	2706	reconstructing, maintaining, repairing, enlarging, furnishing or remodeling
2707	2707	a home or facility, it shall obtain from the state and furnish to the
2708	2708	contractor an exemption certificate for the project involved, and the
2709	2709	contractor may purchase materials for incorporation in such project. The
2710	2710	contractor shall furnish the number of such certificates to all suppliers
2711	2711	from whom such purchases are made, and such suppliers shall execute
2712	2712	1
2713	2713	2
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2748	2748	37
2749	2749	38
2750	2750	39
2751	2751	40
2752	2752	41
2753	2753	42
2754	2754	43 HB 2450 33
2755	2755	invoices covering the same bearing the number of such certificate. Upon
2756	2756	completion of the project, the contractor shall furnish to such nonprofit
2757	2757	museum a sworn statement on a form to be provided by the director of
2758	2758	taxation that all purchases so made were entitled to exemption under this
2759	2759	subsection. All invoices shall be held by the contractor for a period of five
2760	2760	years and shall be subject to audit by the director of taxation. If any
2761	2761	materials purchased under such a certificate are found not to have been
2762	2762	incorporated in the building or other project or not to have been returned
2763	2763	for credit or the sales or compensating tax otherwise imposed upon such
2764	2764	materials that will not be so incorporated in a home or facility or other
2765	2765	project reported and paid by such contractor to the director of taxation not
2766	2766	later than the 20
2767	2767	th
2768	2768	day of the month following the close of the month in
2769	2769	which it shall be determined that such materials will not be used for the
2770	2770	purpose for which such certificate was issued, such nonprofit museum
2771	2771	shall be liable for tax on all materials purchased for the project, and upon
2772	2772	payment thereof it may recover the same from the contractor together with
2773	2773	reasonable attorney fees. Any contractor or any agent, employee or
2774	2774	subcontractor thereof, who shall use or otherwise dispose of any materials
2775	2775	purchased under such a certificate for any purpose other than that for
2776	2776	which such a certificate is issued without the payment of the sales or
2777	2777	compensating tax otherwise imposed upon such materials, shall be guilty
2778	2778	of a misdemeanor and, upon conviction therefor, shall be subject to the
2779	2779	penalties provided for in K.S.A. 79-3615(h), and amendments thereto;
2780	2780	(uuu) all sales of tangible personal property and services purchased
2781	2781	by Kansas children's service league, hereinafter referred to as KCSL,
2782	2782	which is exempt from federal income taxation pursuant to section 501(c)
2783	2783	(3) of the federal internal revenue code of 1986, and which such property
2784	2784	and services are used for the purpose of providing for the prevention and
2785	2785	treatment of child abuse and maltreatment as well as meeting additional
2786	2786	critical needs for children, juveniles and family, and all sales of any such
2787	2787	property by or on behalf of KCSL for any such purpose; and all sales of
2788	2788	tangible personal property or services purchased by a contractor for the
2789	2789	purpose of constructing, maintaining, repairing, enlarging, furnishing or
2790	2790	remodeling facilities for the operation of services for KCSL for any such
2791	2791	purpose that would be exempt from taxation under the provisions of this
2792	2792	section if purchased directly by KCSL. Nothing in this subsection shall be
2793	2793	deemed to exempt the purchase of any construction machinery, equipment
2794	2794	or tools used in the constructing, maintaining, repairing, enlarging,
2795	2795	furnishing or remodeling such facilities for KCSL. When KCSL contracts
2796	2796	for the purpose of constructing, maintaining, repairing, enlarging,
2797	2797	furnishing or remodeling such facilities, it shall obtain from the state and
2798	2798	furnish to the contractor an exemption certificate for the project involved,
2799	2799	and the contractor may purchase materials for incorporation in such
2800	2800	1
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2826	2826	27
2827	2827	28
2828	2828	29
2829	2829	30
2830	2830	31
2831	2831	32
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2839	2839	40
2840	2840	41
2841	2841	42
2842	2842	43 HB 2450 34
2843	2843	project. The contractor shall furnish the number of such certificate to all
2844	2844	suppliers from whom such purchases are made, and such suppliers shall
2845	2845	execute invoices covering the same bearing the number of such certificate.
2846	2846	Upon completion of the project the contractor shall furnish to KCSL a
2847	2847	sworn statement, on a form to be provided by the director of taxation, that
2848	2848	all purchases so made were entitled to exemption under this subsection.
2849	2849	All invoices shall be held by the contractor for a period of five years and
2850	2850	shall be subject to audit by the director of taxation. If any materials
2851	2851	purchased under such a certificate are found not to have been incorporated
2852	2852	in the building or other project or not to have been returned for credit or
2853	2853	the sales or compensating tax otherwise imposed upon such materials that
2854	2854	will not be so incorporated in the building or other project reported and
2855	2855	paid by such contractor to the director of taxation not later than the 20
2856	2856	th
2857	2857	day of the month following the close of the month in which it shall be
2858	2858	determined that such materials will not be used for the purpose for which
2859	2859	such certificate was issued, KCSL shall be liable for tax on all materials
2860	2860	purchased for the project, and upon payment thereof it may recover the
2861	2861	same from the contractor together with reasonable attorney fees. Any
2862	2862	contractor or any agent, employee or subcontractor thereof, who shall use
2863	2863	or otherwise dispose of any materials purchased under such a certificate
2864	2864	for any purpose other than that for which such a certificate is issued
2865	2865	without the payment of the sales or compensating tax otherwise imposed
2866	2866	upon such materials, shall be guilty of a misdemeanor and, upon
2867	2867	conviction therefor, shall be subject to the penalties provided for in K.S.A.
2868	2868	79-3615(h), and amendments thereto;
2869	2869	(vvv) all sales of tangible personal property or services, including the
2870	2870	renting and leasing of tangible personal property or services, purchased by
2871	2871	jazz in the woods, inc., a Kansas corporation that is exempt from federal
2872	2872	income taxation pursuant to section 501(c)(3) of the federal internal
2873	2873	revenue code, for the purpose of providing jazz in the woods, an event
2874	2874	benefiting children-in-need and other nonprofit charities assisting such
2875	2875	children, and all sales of any such property by or on behalf of such
2876	2876	organization for such purpose;
2877	2877	(www) all sales of tangible personal property purchased by or on
2878	2878	behalf of the Frontenac education foundation, which is exempt from
2879	2879	federal income taxation pursuant to section 501(c)(3) of the federal
2880	2880	internal revenue code, for the purpose of providing education support for
2881	2881	students, and all sales of any such property by or on behalf of such
2882	2882	organization for such purpose;
2883	2883	(xxx) all sales of personal property and services purchased by the
2884	2884	booth theatre foundation, inc., an organization, which is exempt from
2885	2885	federal income taxation pursuant to section 501(c)(3) of the federal
2886	2886	internal revenue code of 1986, and which such personal property and
2887	2887	1
2888	2888	2
2889	2889	3
2890	2890	4
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2911	2911	25
2912	2912	26
2913	2913	27
2914	2914	28
2915	2915	29
2916	2916	30
2917	2917	31
2918	2918	32
2919	2919	33
2920	2920	34
2921	2921	35
2922	2922	36
2923	2923	37
2924	2924	38
2925	2925	39
2926	2926	40
2927	2927	41
2928	2928	42
2929	2929	43 HB 2450 35
2930	2930	services are used by any such organization in the constructing, equipping,
2931	2931	reconstructing, maintaining, repairing, enlarging, furnishing or remodeling
2932	2932	of the booth theatre, and all sales of tangible personal property or services
2933	2933	purchased by a contractor for the purpose of constructing, equipping,
2934	2934	reconstructing, maintaining, repairing, enlarging, furnishing or remodeling
2935	2935	the booth theatre for such organization, that would be exempt from
2936	2936	taxation under the provisions of this section if purchased directly by such
2937	2937	organization. Nothing in this subsection shall be deemed to exempt the
2938	2938	purchase of any construction machinery, equipment or tools used in the
2939	2939	constructing, equipping, reconstructing, maintaining, repairing, enlarging,
2940	2940	furnishing or remodeling facilities for any such organization. When any
2941	2941	such organization shall contract for the purpose of constructing, equipping,
2942	2942	reconstructing, maintaining, repairing, enlarging, furnishing or remodeling
2943	2943	facilities, it shall obtain from the state and furnish to the contractor an
2944	2944	exemption certificate for the project involved, and the contractor may
2945	2945	purchase materials for incorporation in such project. The contractor shall
2946	2946	furnish the number of such certificate to all suppliers from whom such
2947	2947	purchases are made, and such suppliers shall execute invoices covering the
2948	2948	same bearing the number of such certificate. Upon completion of the
2949	2949	project the contractor shall furnish to such organization concerned a sworn
2950	2950	statement, on a form to be provided by the director of taxation, that all
2951	2951	purchases so made were entitled to exemption under this subsection. All
2952	2952	invoices shall be held by the contractor for a period of five years and shall
2953	2953	be subject to audit by the director of taxation. If any materials purchased
2954	2954	under such a certificate are found not to have been incorporated in such
2955	2955	facilities or not to have been returned for credit or the sales or
2956	2956	compensating tax otherwise imposed upon such materials that will not be
2957	2957	so incorporated in such facilities reported and paid by such contractor to
2958	2958	the director of taxation not later than the 20
2959	2959	th
2960	2960	day of the month following
2961	2961	the close of the month in which it shall be determined that such materials
2962	2962	will not be used for the purpose for which such certificate was issued, such
2963	2963	organization concerned shall be liable for tax on all materials purchased
2964	2964	for the project, and upon payment thereof it may recover the same from
2965	2965	the contractor together with reasonable attorney fees. Any contractor or
2966	2966	any agent, employee or subcontractor thereof, who shall use or otherwise
2967	2967	dispose of any materials purchased under such a certificate for any purpose
2968	2968	other than that for which such a certificate is issued without the payment
2969	2969	of the sales or compensating tax otherwise imposed upon such materials,
2970	2970	shall be guilty of a misdemeanor and, upon conviction therefor, shall be
2971	2971	subject to the penalties provided for in K.S.A. 79-3615(h), and
2972	2972	amendments thereto. Sales tax paid on and after January 1, 2007, but prior
2973	2973	to the effective date of this act upon the gross receipts received from any
2974	2974	sale which would have been exempted by the provisions of this subsection
2975	2975	1
2976	2976	2
2977	2977	3
2978	2978	4
2979	2979	5
2980	2980	6
2981	2981	7
2982	2982	8
2983	2983	9
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2987	2987	13
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2989	2989	15
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2996	2996	22
2997	2997	23
2998	2998	24
2999	2999	25
3000	3000	26
3001	3001	27
3002	3002	28
3003	3003	29
3004	3004	30
3005	3005	31
3006	3006	32
3007	3007	33
3008	3008	34
3009	3009	35
3010	3010	36
3011	3011	37
3012	3012	38
3013	3013	39
3014	3014	40
3015	3015	41
3016	3016	42
3017	3017	43 HB 2450 36
3018	3018	had such sale occurred after the effective date of this act shall be refunded.
3019	3019	Each claim for a sales tax refund shall be verified and submitted to the
3020	3020	director of taxation upon forms furnished by the director and shall be
3021	3021	accompanied by any additional documentation required by the director.
3022	3022	The director shall review each claim and shall refund that amount of sales
3023	3023	tax paid as determined under the provisions of this subsection. All refunds
3024	3024	shall be paid from the sales tax refund fund upon warrants of the director
3025	3025	of accounts and reports pursuant to vouchers approved by the director or
3026	3026	the director's designee;
3027	3027	(yyy) all sales of tangible personal property and services purchased
3028	3028	by TLC charities foundation, inc., hereinafter referred to as TLC charities,
3029	3029	which is exempt from federal income taxation pursuant to section 501(c)
3030	3030	(3) of the federal internal revenue code of 1986, and which such property
3031	3031	and services are used for the purpose of encouraging private philanthropy
3032	3032	to further the vision, values, and goals of TLC for children and families,
3033	3033	inc.; and all sales of such property and services by or on behalf of TLC
3034	3034	charities for any such purpose and all sales of tangible personal property or
3035	3035	services purchased by a contractor for the purpose of constructing,
3036	3036	maintaining, repairing, enlarging, furnishing or remodeling facilities for
3037	3037	the operation of services for TLC charities for any such purpose that would
3038	3038	be exempt from taxation under the provisions of this section if purchased
3039	3039	directly by TLC charities. Nothing in this subsection shall be deemed to
3040	3040	exempt the purchase of any construction machinery, equipment or tools
3041	3041	used in the constructing, maintaining, repairing, enlarging, furnishing or
3042	3042	remodeling such facilities for TLC charities. When TLC charities contracts
3043	3043	for the purpose of constructing, maintaining, repairing, enlarging,
3044	3044	furnishing or remodeling such facilities, it shall obtain from the state and
3045	3045	furnish to the contractor an exemption certificate for the project involved,
3046	3046	and the contractor may purchase materials for incorporation in such
3047	3047	project. The contractor shall furnish the number of such certificate to all
3048	3048	suppliers from whom such purchases are made, and such suppliers shall
3049	3049	execute invoices covering the same bearing the number of such certificate.
3050	3050	Upon completion of the project the contractor shall furnish to TLC
3051	3051	charities a sworn statement, on a form to be provided by the director of
3052	3052	taxation, that all purchases so made were entitled to exemption under this
3053	3053	subsection. All invoices shall be held by the contractor for a period of five
3054	3054	years and shall be subject to audit by the director of taxation. If any
3055	3055	materials purchased under such a certificate are found not to have been
3056	3056	incorporated in the building or other project or not to have been returned
3057	3057	for credit or the sales or compensating tax otherwise imposed upon such
3058	3058	materials that will not be incorporated into the building or other project
3059	3059	reported and paid by such contractor to the director of taxation not later
3060	3060	than the 20
3061	3061	th
3062	3062	day of the month following the close of the month in which it
3063	3063	1
3064	3064	2
3065	3065	3
3066	3066	4
3067	3067	5
3068	3068	6
3069	3069	7
3070	3070	8
3071	3071	9
3072	3072	10
3073	3073	11
3074	3074	12
3075	3075	13
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3081	3081	19
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3083	3083	21
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3087	3087	25
3088	3088	26
3089	3089	27
3090	3090	28
3091	3091	29
3092	3092	30
3093	3093	31
3094	3094	32
3095	3095	33
3096	3096	34
3097	3097	35
3098	3098	36
3099	3099	37
3100	3100	38
3101	3101	39
3102	3102	40
3103	3103	41
3104	3104	42
3105	3105	43 HB 2450 37
3106	3106	shall be determined that such materials will not be used for the purpose for
3107	3107	which such certificate was issued, TLC charities shall be liable for tax on
3108	3108	all materials purchased for the project, and upon payment thereof it may
3109	3109	recover the same from the contractor together with reasonable attorney
3110	3110	fees. Any contractor or any agent, employee or subcontractor thereof, who
3111	3111	shall use or otherwise dispose of any materials purchased under such a
3112	3112	certificate for any purpose other than that for which such a certificate is
3113	3113	issued without the payment of the sales or compensating tax otherwise
3114	3114	imposed upon such materials, shall be guilty of a misdemeanor and, upon
3115	3115	conviction therefor, shall be subject to the penalties provided for in K.S.A.
3116	3116	79-3615(h), and amendments thereto;
3117	3117	(zzz) all sales of tangible personal property purchased by the rotary
3118	3118	club of shawnee foundation, which is exempt from federal income taxation
3119	3119	pursuant to section 501(c)(3) of the federal internal revenue code of 1986,
3120	3120	as amended, used for the purpose of providing contributions to community
3121	3121	service organizations and scholarships;
3122	3122	(aaaa) all sales of personal property and services purchased by or on
3123	3123	behalf of victory in the valley, inc., which is exempt from federal income
3124	3124	taxation pursuant to section 501(c)(3) of the federal internal revenue code,
3125	3125	for the purpose of providing a cancer support group and services for
3126	3126	persons with cancer, and all sales of any such property by or on behalf of
3127	3127	any such organization for any such purpose;
3128	3128	(bbbb) all sales of entry or participation fees, charges or tickets by
3129	3129	Guadalupe health foundation, which is exempt from federal income
3130	3130	taxation pursuant to section 501(c)(3) of the federal internal revenue code,
3131	3131	for such organization's annual fundraising event which purpose is to
3132	3132	provide health care services for uninsured workers;
3133	3133	(cccc) all sales of tangible personal property or services purchased by
3134	3134	or on behalf of wayside waifs, inc., which is exempt from federal income
3135	3135	taxation pursuant to section 501(c)(3) of the federal internal revenue code,
3136	3136	for the purpose of providing such organization's annual fundraiser, an
3137	3137	event whose purpose is to support the care of homeless and abandoned
3138	3138	animals, animal adoption efforts, education programs for children and
3139	3139	efforts to reduce animal over-population and animal welfare services, and
3140	3140	all sales of any such property, including entry or participation fees or
3141	3141	charges, by or on behalf of such organization for such purpose;
3142	3142	(dddd) all sales of tangible personal property or services purchased
3143	3143	by or on behalf of goodwill industries or Easter seals of Kansas, inc., both
3144	3144	of which are exempt from federal income taxation pursuant to section
3145	3145	501(c)(3) of the federal internal revenue code, for the purpose of providing
3146	3146	education, training and employment opportunities for people with
3147	3147	disabilities and other barriers to employment;
3148	3148	(eeee) all sales of tangible personal property or services purchased by
3149	3149	1
3150	3150	2
3151	3151	3
3152	3152	4
3153	3153	5
3154	3154	6
3155	3155	7
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3160	3160	12
3161	3161	13
3162	3162	14
3163	3163	15
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3170	3170	22
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3172	3172	24
3173	3173	25
3174	3174	26
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3176	3176	28
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3178	3178	30
3179	3179	31
3180	3180	32
3181	3181	33
3182	3182	34
3183	3183	35
3184	3184	36
3185	3185	37
3186	3186	38
3187	3187	39
3188	3188	40
3189	3189	41
3190	3190	42
3191	3191	43 HB 2450 38
3192	3192	or on behalf of all American beef battalion, inc., which is exempt from
3193	3193	federal income taxation pursuant to section 501(c)(3) of the federal
3194	3194	internal revenue code, for the purpose of educating, promoting and
3195	3195	participating as a contact group through the beef cattle industry in order to
3196	3196	carry out such projects that provide support and morale to members of the
3197	3197	United States armed forces and military services;
3198	3198	(ffff) all sales of tangible personal property and services purchased by
3199	3199	sheltered living, inc., which is exempt from federal income taxation
3200	3200	pursuant to section 501(c)(3) of the federal internal revenue code of 1986,
3201	3201	and which such property and services are used for the purpose of
3202	3202	providing residential and day services for people with developmental
3203	3203	disabilities or intellectual disability, or both, and all sales of any such
3204	3204	property by or on behalf of sheltered living, inc., for any such purpose; and
3205	3205	all sales of tangible personal property or services purchased by a
3206	3206	contractor for the purpose of rehabilitating, constructing, maintaining,
3207	3207	repairing, enlarging, furnishing or remodeling homes and facilities for
3208	3208	sheltered living, inc., for any such purpose that would be exempt from
3209	3209	taxation under the provisions of this section if purchased directly by
3210	3210	sheltered living, inc. Nothing in this subsection shall be deemed to exempt
3211	3211	the purchase of any construction machinery, equipment or tools used in the
3212	3212	constructing, maintaining, repairing, enlarging, furnishing or remodeling
3213	3213	such homes and facilities for sheltered living, inc. When sheltered living,
3214	3214	inc., contracts for the purpose of rehabilitating, constructing, maintaining,
3215	3215	repairing, enlarging, furnishing or remodeling such homes and facilities, it
3216	3216	shall obtain from the state and furnish to the contractor an exemption
3217	3217	certificate for the project involved, and the contractor may purchase
3218	3218	materials for incorporation in such project. The contractor shall furnish the
3219	3219	number of such certificate to all suppliers from whom such purchases are
3220	3220	made, and such suppliers shall execute invoices covering the same bearing
3221	3221	the number of such certificate. Upon completion of the project the
3222	3222	contractor shall furnish to sheltered living, inc., a sworn statement, on a
3223	3223	form to be provided by the director of taxation, that all purchases so made
3224	3224	were entitled to exemption under this subsection. All invoices shall be held
3225	3225	by the contractor for a period of five years and shall be subject to audit by
3226	3226	the director of taxation. If any materials purchased under such a certificate
3227	3227	are found not to have been incorporated in the building or other project or
3228	3228	not to have been returned for credit or the sales or compensating tax
3229	3229	otherwise imposed upon such materials that will not be so incorporated in
3230	3230	the building or other project reported and paid by such contractor to the
3231	3231	director of taxation not later than the 20
3232	3232	th
3233	3233	day of the month following the
3234	3234	close of the month in which it shall be determined that such materials will
3235	3235	not be used for the purpose for which such certificate was issued, sheltered
3236	3236	living, inc., shall be liable for tax on all materials purchased for the
3237	3237	1
3238	3238	2
3239	3239	3
3240	3240	4
3241	3241	5
3242	3242	6
3243	3243	7
3244	3244	8
3245	3245	9
3246	3246	10
3247	3247	11
3248	3248	12
3249	3249	13
3250	3250	14
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3252	3252	16
3253	3253	17
3254	3254	18
3255	3255	19
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3262	3262	26
3263	3263	27
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3265	3265	29
3266	3266	30
3267	3267	31
3268	3268	32
3269	3269	33
3270	3270	34
3271	3271	35
3272	3272	36
3273	3273	37
3274	3274	38
3275	3275	39
3276	3276	40
3277	3277	41
3278	3278	42
3279	3279	43 HB 2450 39
3280	3280	project, and upon payment thereof it may recover the same from the
3281	3281	contractor together with reasonable attorney fees. Any contractor or any
3282	3282	agent, employee or subcontractor thereof, who shall use or otherwise
3283	3283	dispose of any materials purchased under such a certificate for any purpose
3284	3284	other than that for which such a certificate is issued without the payment
3285	3285	of the sales or compensating tax otherwise imposed upon such materials,
3286	3286	shall be guilty of a misdemeanor and, upon conviction therefor, shall be
3287	3287	subject to the penalties provided for in K.S.A. 79-3615(h), and
3288	3288	amendments thereto;
3289	3289	(gggg) all sales of game birds for which the primary purpose is use in
3290	3290	hunting;
3291	3291	(hhhh) all sales of tangible personal property or services purchased
3292	3292	on or after July 1, 2014, for the purpose of and in conjunction with
3293	3293	constructing, reconstructing, enlarging or remodeling a business identified
3294	3294	under the North American industry classification system (NAICS)
3295	3295	subsectors 1123, 1124, 112112, 112120 or 112210, and the sale and
3296	3296	installation of machinery and equipment purchased for installation at any
3297	3297	such business. The exemption provided in this subsection shall not apply
3298	3298	to projects that have actual total costs less than $50,000. When a person
3299	3299	contracts for the construction, reconstruction, enlargement or remodeling
3300	3300	of any such business, such person shall obtain from the state and furnish to
3301	3301	the contractor an exemption certificate for the project involved, and the
3302	3302	contractor may purchase materials, machinery and equipment for
3303	3303	incorporation in such project. The contractor shall furnish the number of
3304	3304	such certificates to all suppliers from whom such purchases are made, and
3305	3305	such suppliers shall execute invoices covering the same bearing the
3306	3306	number of such certificate. Upon completion of the project, the contractor
3307	3307	shall furnish to the owner of the business a sworn statement, on a form to
3308	3308	be provided by the director of taxation, that all purchases so made were
3309	3309	entitled to exemption under this subsection. All invoices shall be held by
3310	3310	the contractor for a period of five years and shall be subject to audit by the
3311	3311	director of taxation. Any contractor or any agent, employee or
3312	3312	subcontractor of the contractor, who shall use or otherwise dispose of any
3313	3313	materials, machinery or equipment purchased under such a certificate for
3314	3314	any purpose other than that for which such a certificate is issued without
3315	3315	the payment of the sales or compensating tax otherwise imposed thereon,
3316	3316	shall be guilty of a misdemeanor and, upon conviction therefor, shall be
3317	3317	subject to the penalties provided for in K.S.A. 79-3615(h), and
3318	3318	amendments thereto;
3319	3319	(iiii) all sales of tangible personal property or services purchased by a
3320	3320	contractor for the purpose of constructing, maintaining, repairing,
3321	3321	enlarging, furnishing or remodeling facilities for the operation of services
3322	3322	for Wichita children's home for any such purpose that would be exempt
3323	3323	1
3324	3324	2
3325	3325	3
3326	3326	4
3327	3327	5
3328	3328	6
3329	3329	7
3330	3330	8
3331	3331	9
3332	3332	10
3333	3333	11
3334	3334	12
3335	3335	13
3336	3336	14
3337	3337	15
3338	3338	16
3339	3339	17
3340	3340	18
3341	3341	19
3342	3342	20
3343	3343	21
3344	3344	22
3345	3345	23
3346	3346	24
3347	3347	25
3348	3348	26
3349	3349	27
3350	3350	28
3351	3351	29
3352	3352	30
3353	3353	31
3354	3354	32
3355	3355	33
3356	3356	34
3357	3357	35
3358	3358	36
3359	3359	37
3360	3360	38
3361	3361	39
3362	3362	40
3363	3363	41
3364	3364	42
3365	3365	43 HB 2450 40
3366	3366	from taxation under the provisions of this section if purchased directly by
3367	3367	Wichita children's home. Nothing in this subsection shall be deemed to
3368	3368	exempt the purchase of any construction machinery, equipment or tools
3369	3369	used in the constructing, maintaining, repairing, enlarging, furnishing or
3370	3370	remodeling such facilities for Wichita children's home. When Wichita
3371	3371	children's home contracts for the purpose of constructing, maintaining,
3372	3372	repairing, enlarging, furnishing or remodeling such facilities, it shall obtain
3373	3373	from the state and furnish to the contractor an exemption certificate for the
3374	3374	project involved, and the contractor may purchase materials for
3375	3375	incorporation in such project. The contractor shall furnish the number of
3376	3376	such certificate to all suppliers from whom such purchases are made, and
3377	3377	such suppliers shall execute invoices covering the same bearing the
3378	3378	number of such certificate. Upon completion of the project, the contractor
3379	3379	shall furnish to Wichita children's home a sworn statement, on a form to be
3380	3380	provided by the director of taxation, that all purchases so made were
3381	3381	entitled to exemption under this subsection. All invoices shall be held by
3382	3382	the contractor for a period of five years and shall be subject to audit by the
3383	3383	director of taxation. If any materials purchased under such a certificate are
3384	3384	found not to have been incorporated in the building or other project or not
3385	3385	to have been returned for credit or the sales or compensating tax otherwise
3386	3386	imposed upon such materials that will not be so incorporated in the
3387	3387	building or other project reported and paid by such contractor to the
3388	3388	director of taxation not later than the 20
3389	3389	th
3390	3390	day of the month following the
3391	3391	close of the month in which it shall be determined that such materials will
3392	3392	not be used for the purpose for which such certificate was issued, Wichita
3393	3393	children's home shall be liable for the tax on all materials purchased for the
3394	3394	project, and upon payment, it may recover the same from the contractor
3395	3395	together with reasonable attorney fees. Any contractor or any agent,
3396	3396	employee or subcontractor, who shall use or otherwise dispose of any
3397	3397	materials purchased under such a certificate for any purpose other than that
3398	3398	for which such a certificate is issued without the payment of the sales or
3399	3399	compensating tax otherwise imposed upon such materials, shall be guilty
3400	3400	of a misdemeanor and, upon conviction, shall be subject to the penalties
3401	3401	provided for in K.S.A. 79-3615(h), and amendments thereto;
3402	3402	(jjjj) all sales of tangible personal property or services purchased by
3403	3403	or on behalf of the beacon, inc., that is exempt from federal income
3404	3404	taxation pursuant to section 501(c)(3) of the federal internal revenue code,
3405	3405	for the purpose of providing those desiring help with food, shelter, clothing
3406	3406	and other necessities of life during times of special need;
3407	3407	(kkkk) all sales of tangible personal property and services purchased
3408	3408	by or on behalf of reaching out from within, inc., which is exempt from
3409	3409	federal income taxation pursuant to section 501(c)(3) of the federal
3410	3410	internal revenue code, for the purpose of sponsoring self-help programs for
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3453	3453	43 HB 2450 41
3454	3454	incarcerated persons that will enable such incarcerated persons to become
3455	3455	role models for non-violence while in correctional facilities and productive
3456	3456	family members and citizens upon return to the community;
3457	3457	(llll) all sales of tangible personal property and services purchased by
3458	3458	Gove county healthcare endowment foundation, inc., which is exempt
3459	3459	from federal income taxation pursuant to section 501(c)(3) of the federal
3460	3460	internal revenue code of 1986, and which such property and services are
3461	3461	used for the purpose of constructing and equipping an airport in Quinter,
3462	3462	Kansas, and all sales of tangible personal property or services purchased
3463	3463	by a contractor for the purpose of constructing and equipping an airport in
3464	3464	Quinter, Kansas, for such organization, that would be exempt from
3465	3465	taxation under the provisions of this section if purchased directly by such
3466	3466	organization. Nothing in this subsection shall be deemed to exempt the
3467	3467	purchase of any construction machinery, equipment or tools used in the
3468	3468	constructing or equipping of facilities for such organization. When such
3469	3469	organization shall contract for the purpose of constructing or equipping an
3470	3470	airport in Quinter, Kansas, it shall obtain from the state and furnish to the
3471	3471	contractor an exemption certificate for the project involved, and the
3472	3472	contractor may purchase materials for incorporation in such project. The
3473	3473	contractor shall furnish the number of such certificate to all suppliers from
3474	3474	whom such purchases are made, and such suppliers shall execute invoices
3475	3475	covering the same bearing the number of such certificate. Upon
3476	3476	completion of the project, the contractor shall furnish to such organization
3477	3477	concerned a sworn statement, on a form to be provided by the director of
3478	3478	taxation, that all purchases so made were entitled to exemption under this
3479	3479	subsection. All invoices shall be held by the contractor for a period of five
3480	3480	years and shall be subject to audit by the director of taxation. If any
3481	3481	materials purchased under such a certificate are found not to have been
3482	3482	incorporated in such facilities or not to have been returned for credit or the
3483	3483	sales or compensating tax otherwise imposed upon such materials that will
3484	3484	not be so incorporated in such facilities reported and paid by such
3485	3485	contractor to the director of taxation no later than the 20
3486	3486	th
3487	3487	day of the month
3488	3488	following the close of the month in which it shall be determined that such
3489	3489	materials will not be used for the purpose for which such certificate was
3490	3490	issued, such organization concerned shall be liable for tax on all materials
3491	3491	purchased for the project, and upon payment thereof it may recover the
3492	3492	same from the contractor together with reasonable attorney fees. Any
3493	3493	contractor or any agent, employee or subcontractor thereof, who purchased
3494	3494	under such a certificate for any purpose other than that for which such a
3495	3495	certificate is issued without the payment of the sales or compensating tax
3496	3496	otherwise imposed upon such materials, shall be guilty of a misdemeanor
3497	3497	and, upon conviction therefor, shall be subject to the penalties provided for
3498	3498	in K.S.A. 79-3615(h), and amendments thereto. The provisions of this
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3541	3541	43 HB 2450 42
3542	3542	subsection shall expire and have no effect on and after July 1, 2019;
3543	3543	(mmmm) all sales of gold or silver coins; and palladium, platinum,
3544	3544	gold or silver bullion. For the purposes of this subsection, "bullion" means
3545	3545	bars, ingots or commemorative medallions of gold, silver, platinum,
3546	3546	palladium, or a combination thereof, for which the value of the metal
3547	3547	depends on its content and not the form;
3548	3548	(nnnn) all sales of tangible personal property or services purchased
3549	3549	by friends of hospice of Jefferson county, an organization that is exempt
3550	3550	from federal income taxation pursuant to section 501(c)(3) of the federal
3551	3551	internal revenue code of 1986, for the purpose of providing support to the
3552	3552	Jefferson county hospice agency in end-of-life care of Jefferson county
3553	3553	families, friends and neighbors, and all sales of entry or participation fees,
3554	3554	charges or tickets by friends of hospice of Jefferson county for such
3555	3555	organization's fundraising event for such purpose; and
3556	3556	(oooo) all sales of tangible personal property or services purchased
3557	3557	for the purpose of and in conjunction with constructing, reconstructing,
3558	3558	enlarging or remodeling a qualified business facility by a qualified firm or
3559	3559	qualified supplier that meets the requirements established in K.S.A. 2022
3560	3560	Supp. 74-50,312 and 74-50,319, and amendments thereto, and that has
3561	3561	been approved for a project exemption certificate by the secretary of
3562	3562	commerce, and the sale and installation of machinery and equipment
3563	3563	purchased by such qualified firm or qualified supplier for installation at
3564	3564	any such qualified business facility. When a person shall contract for the
3565	3565	construction, reconstruction, enlargement or remodeling of any such
3566	3566	qualified business facility, such person shall obtain from the state and
3567	3567	furnish to the contractor an exemption certificate for the project involved,
3568	3568	and the contractor may purchase materials, machinery and equipment for
3569	3569	incorporation in such project. The contractor shall furnish the number of
3570	3570	such certificates to all suppliers from whom such purchases are made, and
3571	3571	such suppliers shall execute invoices covering the same bearing the
3572	3572	number of such certificate. Upon completion of the project, the contractor
3573	3573	shall furnish to the owner of the qualified firm or qualified supplier a
3574	3574	sworn statement, on a form to be provided by the director of taxation, that
3575	3575	all purchases so made were entitled to exemption under this subsection.
3576	3576	All invoices shall be held by the contractor for a period of five years and
3577	3577	shall be subject to audit by the director of taxation. Any contractor or any
3578	3578	agent, employee or subcontractor thereof who shall use or otherwise
3579	3579	dispose of any materials, machinery or equipment purchased under such a
3580	3580	certificate for any purpose other than that for which such a certificate is
3581	3581	issued without the payment of the sales or compensating tax otherwise
3582	3582	imposed thereon, shall be guilty of a misdemeanor and, upon conviction
3583	3583	therefor, shall be subject to the penalties provided for in K.S.A. 79-
3584	3584	3615(h), and amendments thereto. As used in this subsection, "qualified
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3627	3627	43 HB 2450 43
3628	3628	business facility," "qualified firm" and "qualified supplier" mean the same
3629	3629	as defined in K.S.A. 2022 Supp. 74-50,311, and amendments thereto; and
3630	3630	(pppp) all sales of tangible personal property or services purchased
3631	3631	for the purpose of and in conjunction with constructing, reconstructing,
3632	3632	enlarging or remodeling a qualified data center by a qualified firm that
3633	3633	meets the requirements established in sections 1 through 3, and
3634	3634	amendments thereto, and that has been approved and certified for a
3635	3635	project exemption certificate by the secretary of commerce, the sale and
3636	3636	installation of machinery and equipment data center equipment and
3637	3637	eligible data center costs purchased by such qualified firm for such
3638	3638	qualified data center, electricity used by such qualified data center and
3639	3639	labor services to install, apply, repair, service, alter or maintain data
3640	3640	center equipment. When a person shall contract for the construction,
3641	3641	reconstruction, enlargement or remodeling of any such qualified data
3642	3642	center, such person shall obtain from the state and furnish to the
3643	3643	contractor an exemption certificate for the project involved, and the
3644	3644	contractor may purchase materials, machinery and equipment for
3645	3645	incorporation in such project. The contractor shall furnish the number of
3646	3646	such certificates to all suppliers from whom such purchases are made, and
3647	3647	such suppliers shall execute invoices covering such purchases bearing the
3648	3648	number of such certificates. Upon completion of the project, the
3649	3649	contractor shall furnish to the owner of the qualified firm a sworn
3650	3650	statement, on a form to be provided by the director of taxation, that all
3651	3651	purchases so made were entitled to exemption under this subsection. All
3652	3652	invoices shall be held by the contractor for a period of five years and shall
3653	3653	be subject to audit by the director of taxation. Any contractor or any
3654	3654	agent, employee or subcontractor thereof who shall use or otherwise
3655	3655	dispose of any materials, machinery or equipment purchased under such a
3656	3656	certificate for any purpose other than that for which such a certificate is
3657	3657	issued without the payment of the sales or compensating tax otherwise
3658	3658	imposed thereon, shall be guilty of a misdemeanor and, upon conviction
3659	3659	thereof, shall be subject to the penalties provided for in K.S.A. 79-3615(h),
3660	3660	and amendments thereto. As used in this subsection, "data center
3661	3661	equipment," "eligible data center costs," "qualified data center" and
3662	3662	"qualified firm" mean the same as defined in section 1, and amendments
3663	3663	thereto.
3664	3664	Sec. 5. K.S.A. 2022 Supp. 79-3606 is hereby repealed.
3665	3665	Sec. 6. This act shall take effect and be in force from and after its
3666	3666	publication in the statute book.
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