KS
Kansas House Bill HB2788

Kansas 2023-2024 Regular Session

Kansas House Bill HB2788 Compare Versions

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11 Session of 2024
22 HOUSE BILL No. 2788
33 By Committee on Commerce, Labor and Economic Development
44 Requested by Representative K. Williams
55 2-9
66 AN ACT concerning government transparency; requiring cities and
77 counties to report certain local economic development incentive
88 program information to the secretary of commerce; defining such
99 programs; requiring the secretary of commerce to post such information
1010 on the economic development incentive program database maintained
1111 by the secretary and requiring certain other changes to that database
1212 regarding the presentation of search results; providing for a summary
1313 report by the secretary of commerce to summarize economic
1414 development incentive program data from the several statutorily-
1515 required reports on such programs; directing the secretary of
1616 administration to include on the Kansas taxpayer transparency act
1717 website certain information concerning grants, grant awardees and
1818 grant applications; amending K.S.A. 74-72,123 and K.S.A. 2023 Supp.
1919 74-50,226 and 74-50,227 and repealing the existing sections.
2020 Be it enacted by the Legislature of the State of Kansas:
2121 New Section 1. (a) The secretary of commerce shall prepare a
2222 summary report to the legislature that shall summarize information
2323 provided pursuant to statutorily required reports, as defined in subsection
2424 (c), by the secretary regarding economic development incentive programs.
2525 The purpose of the summary report shall be to provide the legislature with
2626 a readily accessible reference for reviewing the state's investment in
2727 economic development incentive programs. The summary report shall be
2828 provided by the end of the second week of the 2025 regular legislative
2929 session and the end of the second week of each regular legislative session
3030 thereafter.
3131 (b) The summary report shall include the following information:
3232 (1) The total number of businesses and individuals who have
3333 participated in economic development incentive programs in the prior
3434 year, categorized by each economic development incentive program;
3535 (2) the total amount of benefits provided for each economic
3636 development incentive program and a total of such benefits for each of the
3737 prior 10 years. The summary report shall note if benefits have been
3838 provided by a program that are prohibited from disclosure by law. For any
3939 such benefits, the reporting period shall include the most recent 10 years of
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7575 benefits available for disclosure shall be reported as provided in this
7676 paragraph;
7777 (3) the maximum amount of remaining economic development
7878 incentive program obligations to benefit recipients, categorized by each
7979 economic development incentive program; and
8080 (4) a summary of a return-on-investment analysis, categorized by
8181 each economic development incentive program. Such summary report
8282 shall include a discussion of the total amount of capital investment, jobs to
8383 be created or other requirements required by the program for an applicant
8484 business to receive benefits.
8585 (c) As used in this section, "statutorily required reports" includes:
8686 (1) Any new report required by law enacted on or after July 1, 2024,
8787 for an economic development incentive program administered by the
8888 secretary of commerce that provides annual benefits of more than $50,000;
8989 and
9090 (2) the reports required by the secretary of commerce pursuant to:
9191 (A) K.S.A. 74-5049, and amendments thereto;
9292 (B) K.S.A. 74-50,151(g), and amendments thereto;
9393 (C) K.S.A. 74-50,216, and amendments thereto;
9494 (D) K.S.A. 74-50,224(c), and amendments thereto;
9595 (E) K.S.A. 74-50,320(a), and amendments thereto;
9696 (F) K.S.A. 74-8135(b), and amendments thereto; and
9797 (G) K.S.A. 2023 Supp. 74-8136(c), and amendments thereto.
9898 Sec. 2. K.S.A. 2023 Supp. 74-50,226 is hereby amended to read as
9999 follows: 74-50,226. As used in K.S.A. 2023 Supp. 74-50,226 and 74-
100100 50,227, and amendments thereto:
101101 (a) "Administering agency" means the state agency or department
102102 charged with administering a particular economic development incentive
103103 program, as set forth by the program's enacting statute or, where no
104104 department or agency is set forth, the department of revenue.
105105 (b) "Economic development incentive program" means:
106106 (1) Any economic development incentive program administered
107107 wholly or in part by the secretary of commerce;
108108 (2) any tax credit program, except for social and domestic tax credits,
109109 regardless of the administering agency;
110110 (3) property that has been exempted from ad valorem taxation under
111111 the provisions of section 13 of article 11 of the constitution of the state of
112112 Kansas;
113113 (4) property that has been purchased, acquired, constructed,
114114 reconstructed, improved, equipped, furnished, repaired, enlarged or
115115 remodeled with all or any part of the proceeds of revenue bonds issued
116116 under the authority of K.S.A. 12-1740 through 12-1749a, and amendments
117117 thereto, that is exempt from ad valorem taxation under K.S.A. 79-201a
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161161 Second, and amendments thereto; and
162162 (5) any economic development fund, including, but not limited to, the
163163 job creation program fund established by K.S.A. 74-50,224, and
164164 amendments thereto, and the economic development initiatives fund,
165165 established by K.S.A. 79-4804, and amendments thereto; and
166166 (6) commencing January 1, 2026, "economic development incentive
167167 program" shall include additional active city-based or county-based local
168168 economic development programs, including, but not limited to:
169169 (A) Community improvement districts, K.S.A. 12-6a26 et seq., and
170170 amendments thereto;
171171 (B) tax increment financing, K.S.A. 12-1770 et seq., and amendments
172172 thereto;
173173 (C) business improvement districts, K.S.A. 12-1781 et seq., and
174174 amendments thereto;
175175 (D) self-supported municipal improvement districts, K.S.A. 12-1794
176176 et seq., and amendments thereto;
177177 (E) neighborhood revitalization act, K.S.A. 12-17,114 et seq., and
178178 amendments thereto;
179179 (F) downtown redevelopment act, K.S.A. 12-17,121 et seq., and
180180 amendments thereto;
181181 (G) transportation development districts, K.S.A. 12-17,140 et seq.,
182182 and amendments thereto;
183183 (H) public improvement districts, K.S.A. 12-17,152 et seq., and
184184 amendments thereto;
185185 (I) STAR bonds, K.S.A. 12-17,160 et seq., and amendments thereto;
186186 (J) industrial development bonds, K.S.A. 12-3801 et seq., and
187187 amendments thereto;
188188 (K) qualified manufacturer act, K.S.A. 19-4106 et seq., and
189189 amendments thereto; and
190190 (L) federal enclave redevelopment districts, K.S.A. 19-4901 et seq.,
191191 and amendments thereto.
192192 (c) "Enterprise" means a corporation, limited liability company, S
193193 corporation, partnership, registered limited liability partnership,
194194 foundation, association, nonprofit entity, sole proprietorship, business trust
195195 or other entity engaged in business.
196196 (d) "Recipient" means the enterprise that is the original applicant for
197197 and that receives proceeds from an economic development incentive
198198 program directly from the administering agency. "Recipient" includes an
199199 enterprise that is no longer solvent due to bankruptcy and a recipient with
200200 respect to an economic development project that has failed.
201201 (e) "Social and domestic tax credits" means the adoption credit
202202 created pursuant to K.S.A. 79-202a 79-32,202a, and amendments thereto,
203203 the earned income tax credit created pursuant to K.S.A. 79-32,205, and
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247247 amendments thereto, the food sales tax credit created pursuant to K.S.A.
248248 79-32,271, and amendments thereto, the child and dependent care tax
249249 credit created pursuant to K.S.A. 79-32,111c, and amendments thereto, and
250250 the homestead property tax refund created pursuant to K.S.A. 79-4501 et
251251 seq., and amendments thereto.
252252 (f) "Tax credit program" means any credit allowed against the tax
253253 imposed by the Kansas income tax act, the premium or privilege fees
254254 imposed pursuant to K.S.A. 40-252, and amendments thereto, or the
255255 privilege tax as measured by net income of financial institutions imposed
256256 pursuant to article 11 of chapter 79 of the Kansas Statutes Annotated, and
257257 amendments thereto.
258258 Sec. 3. K.S.A. 2023 Supp. 74-50,227 is hereby amended to read as
259259 follows: 74-50,227. (a) The department of commerce shall collect
260260 incentive data from economic development incentive programs that
261261 provide more than $50,000 of annual incentives from administering
262262 agencies as required by this section. Such data shall be collected from
263263 administering agencies and be stored in a database that is available to the
264264 public in a digital format. The database shall contain information from
265265 multiple years and must be searchable, printable and available to access
266266 over the internet on the department of commerce's website on a
267267 permanently accessible web page that may be accessed via a conspicuous
268268 link to that web page placed on the front page of the department's website.
269269 Information included in the database shall be updated by the department of
270270 commerce on an annual basis and such update shall be completed prior to
271271 the end of the following fiscal year in which such incentive was earned or
272272 distributed. The database shall be comprehensive of all information
273273 required by this section. The database shall permit the user, on one web
274274 page and by means of an easily accessible drop-down menu or other
275275 prompt, to select to search by keyword or phrase within separately
276276 identified categories of economic development incentive program, county
277277 or business name. The result of a search shall include all applicable
278278 information required by this section for such incentive program, county or
279279 business in one printable report, categorized as provided by subsection
280280 (c). In addition to such comprehensive report, the database shall be
281281 configured to provide a summary report in response to a search when
282282 requested.
283283 (b) Cities and counties shall provide the department of commerce
284284 with all applicable information required by this section for all active
285285 economic development programs of such city or county that provide more
286286 than $50,000 of annual incentives. Such information shall be provided for
287287 all such active programs on January 1, 2026. Notwithstanding any other
288288 provision of law, providing such information shall be a condition of
289289 commencing any economic development incentive program by a city or
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333333 county on and after January 1, 2026, and shall be provided to the
334334 department of commerce within 30 days of the commencement of an
335335 economic development incentive program. The city or county shall provide
336336 updates of all applicable information required by this section to the
337337 secretary of commerce at least annually or as required by the secretary of
338338 commerce.
339339 (c) The database required to be created by subsection (a) shall contain
340340 the following information or shall contain a link by which the user can
341341 access such information:
342342 (1) User information for each economic development incentive
343343 program, including the:
344344 (A) Names and addresses, including county, of recipients receiving
345345 benefits from the program and, for sales tax and revenue bonds issued
346346 under the STAR bond financing act, K.S.A. 12-17,162 et seq., and
347347 amendments thereto, the names of principals and officers for each:
348348 (i) Recipient that is a project developer for a STAR bond project,
349349 pursuant to K.S.A. 12-17,162, et seq., and amendments thereto; and
350350 (ii) recipient receiving benefits from any economic development
351351 incentive program if the recipient is organized as a limited liability
352352 company;
353353 (B) annual amount of incentives claimed, distributed to or received
354354 by each recipient and any remaining balance of the total amount of
355355 incentives claimed or awarded to the recipient;
356356 (C) qualification criteria for the economic development incentive
357357 program, including, if available, qualification criteria specific to the
358358 recipient. Qualification criteria shall include, but not be limited to, any
359359 requirements regarding the number of jobs created or the amount of initial
360360 or annual capital improvement;
361361 (D) required benchmarks for continued participation in the economic
362362 development incentive program and progress made toward the
363363 benchmarks; and
364364 (E) years for which the recipient has received benefits under the
365365 economic development incentive program; and
366366 (F) if incentives provided by an economic development incentive
367367 program are transferable, disclosure shall be made of the transferor, the
368368 specific benefit and value of such benefit transferred, the transferee and
369369 the annual and total economic benefit for both the initial recipient and
370370 subsequent transferee or transferees. This information shall be searchable
371371 by name of either the transferor or transferee;
372372 (2) descriptive information for each economic development program,
373373 which shall include:
374374 (A) A description and history of the program, including its inception
375375 date;
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419419 (B) the purpose or goals of the program and the criteria for
420420 qualification;
421421 (C) applications for the program, if any, and relevant resources or
422422 contacts;
423423 (D) the program cost and return on investment, including
424424 assumptions used to calculate the return on investment;
425425 (E) the program compliance rate;
426426 (F) annual reports, if required by statute; and
427427 (G) evaluations of the program, if any; and
428428 (3) annual data, which shall be organized by recipient, county and
429429 program and shall include the:
430430 (A) Total amount of annual incentives from a program claimed or
431431 received by a recipient;
432432 (B) total amount of incentives received by recipients in each county;
433433 and
434434 (C) total amount of incentives distributed by each program.
435435 (c) Data collected pursuant to this section must be aggregated and
436436 provided by program, recipient and county.
437437 (d) Except as otherwise provided in this subsection, and
438438 notwithstanding any information publication requirements listed in this
439439 section, no information shall be disclosed by the secretary of commerce
440440 under this section if such disclosure would:
441441 (1) Violate any federal law;
442442 (2) violate the confidentiality provisions of any agreement executed
443443 before July 1, 2019;
444444 (3) in the discretion of the secretary of commerce, be detrimental to
445445 the development of a STAR bond project or jeopardize an economic
446446 development incentive program or project; or
447447 (4) disclose the names or other personally identifying information of
448448 individuals who have made contributions or investments pursuant to the
449449 provisions of an economic development incentive program for the purpose
450450 of receiving a tax credit.
451451 Information that is otherwise publicly available shall not be considered
452452 confidential and shall be subject to publication as provided in this section.
453453 (e) (1) The secretary of commerce shall report in writing to the
454454 standing committee on commerce, labor and economic development of the
455455 house of representatives and the standing committee on commerce of the
456456 senate any information not disclosed by the secretary pursuant to
457457 subsection (d)(3) and the reason the information was not disclosed. Any
458458 testimony or oral presentation before the committee or discussion by the
459459 committee with respect to the report shall be considered the discussion of
460460 data relating to financial affairs or trade secrets of corporations,
461461 partnerships, trusts, and individual proprietorships pursuant to the
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505505 provisions of K.S.A. 75-4319(b)(4), and amendments thereto, for purposes
506506 of the Kansas open meetings act, and shall be closed to the public.
507507 (2) The report of the secretary pursuant to subsection (e)(1) shall be
508508 confidential and shall not be subject to the provisions of the Kansas open
509509 records act, K.S.A. 45-215 et seq., and amendments thereto. The
510510 provisions of this paragraph shall expire on July 1, 2024, unless the
511511 legislature reviews and reenacts this provision pursuant to K.S.A. 45-229,
512512 and amendments thereto, prior to July 1, 2024.
513513 Sec. 4. K.S.A. 74-72,123 is hereby amended to read as follows: 74-
514514 72,123. (a) As used in the Kansas taxpayer transparency act:
515515 (1) "Searchable website" means a website that allows the public to
516516 search and aggregate the information identified in subsection (b) including
517517 requirements that the website offer the public the ability to efficiently
518518 search and display data, and ascertain the total amounts of revenues and
519519 expenditures of:
520520 (A)  of Funds established within the state treasury in an aggregate or
521521 summary form in a manner determined by the secretary of administration,;
522522 (B)  of compensation paid to public employees employed by state
523523 agencies,; and
524524 (C)  of bond debt as specified in this act.
525525 (2) "Agency" means any entity or instrumentality of the state of
526526 Kansas as defined in K.S.A. 75-3701, and amendments thereto, and any
527527 other entity or instrumentality delegated statutory authority by the
528528 legislature to issue bonds and to collect revenue for the purpose of
529529 repaying bonds issued under authority delegated by statute.
530530 (3) "Board" means the public finance transparency board.
531531 (b) No later than March 1, 2009, The secretary of administration shall
532532 develop and operate a single, searchable website accessible by the public
533533 at no cost to access, that includes:
534534 (1) Annual expenditures, as determined by the secretary of
535535 administration and as available within the central accounting system and
536536 state payroll system, shall include, but not be limited to:
537537 (A) Disbursements by any state agency from funds established within
538538 the state treasury;
539539 (B) bond debt payments;
540540 (C) salaries and wages including, but not limited to, compensation
541541 paid to individual employees of state agencies;
542542 (D) contractual services including, but not limited to, amounts paid to
543543 individual vendors;
544544 (E) commodities including, but not limited to, amounts paid to
545545 individual vendors;
546546 (F) capital outlay including, but not limited to, amounts paid to
547547 individual vendors;
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591591 (G) debt service including, but not limited to, amounts of bond
592592 interest paid and sources of funds paid for individual bond issues;
593593 (H) aid to local units including, but not limited to, amounts paid to
594594 individual units of government for individually identifiable aid programs;
595595 (I) other assistance and benefits;
596596 (J) capital improvements including, but not limited to, amounts of
597597 bond principal paid and sources of funds paid for individual bond issues;
598598 and
599599 (K) tax expenditures as reported by the secretary of revenue in the
600600 annual tax expenditure report.
601601 (2) Annual revenues, as determined by the secretary of administration
602602 and as available within the central accounting system, shall include, but
603603 not be limited to:
604604 (A) Receipts or deposits by any state agency into funds established
605605 within the state treasury;
606606 (B) taxes including, but not limited to, compulsory contributions
607607 imposed by the state for the purpose of financing services;
608608 (C) agency earnings including, but not limited to, amounts collected
609609 by each agency for merchandise sold, services performed, licenses and
610610 permits issued, or regulation;
611611 (D) revenue for the use of money and property including, but not
612612 limited to, amounts received for compensation for the use of state-owned
613613 money and property;
614614 (E) gifts, donations and federal grants including, but not limited to,
615615 amounts received from public and private entities to aid in support of a
616616 specific function or other governmental activity;
617617 (F) other revenue including, but not limited to, receipts not classified
618618 elsewhere; and
619619 (G) non-revenue receipts including, but not limited to, all receipts that
620620 do not constitute revenue.
621621 (3) Annual bonded indebtedness which shall include, but not be
622622 limited to the amount of the total original obligation stated in terms of
623623 principal and interest, the term of the obligation, the source of funding for
624624 repayment of the obligation, the amounts of principal and interest
625625 previously paid to reduce the obligation, the balance remaining of the
626626 obligation, any refinancing of the obligation, and the cited statutory
627627 authority to issue such bonds.
628628 (4) Any grant awarded by any agency using state or federal funds,
629629 including the grant awardee, applications and a list of all applicants who
630630 applied for such grant. The list of all such applicants shall include: (A)
631631 Such applicant's organization name; (B) the county where the proposed
632632 project is located; (C) a brief description of the proposed project in such
633633 application; (D) the dollar amount requested in such application; and (E)
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677677 the date that the above agency received such application. Information
678678 required to be included on the website pursuant to this paragraph shall be
679679 posted within 30 business days of the date of awarding the grant.
680680 (5) Any other relevant information specified by the secretary of
681681 administration after consulting with and seeking the advice of the public
682682 finance transparency board as established in K.S.A. 74-72,124, and
683683 amendments thereto.
684684 (c) The single website provided for in subsection (b) of this section
685685 shall include data for fiscal year 2003 and each fiscal year thereafter. The
686686 website shall be designed so that such data shall be retained on the single
687687 website for not less than 10 years and shall include data for the most recent
688688 fiscal years. Data that is available in the central accounting system and
689689 state payroll system shall be on the single website as soon as possible, but
690690 not later than 45 days after the last day of the preceding fiscal year. The
691691 secretary of administration shall develop policies and procedures to make
692692 data available from any other source. Nothing in this act shall require the
693693 secretary of administration to provide information on the website that is
694694 not available in the central accounting system and the state payroll system
695695 at the time of initial implementation of the website. After implementation
696696 of the initial website, the public finance transparency board shall advise
697697 the secretary of administration on incorporating additional information
698698 described by this act from any other source of information available to the
699699 secretary of administration including information submitted by state
700700 agencies pursuant to subsection (d) of this section.
701701 (d) Any state agency shall provide, at the request of the secretary of
702702 administration, such information as is necessary to accomplish the
703703 purposes of this act.
704704 (e) Nothing in this act shall permit or require the disclosure of
705705 information which is considered confidential by state or federal law.
706706 Sec. 5. K.S.A. 74-72,123 and K.S.A. 2023 Supp. 74-50,226 and 74-
707707 50,227 are hereby repealed.
708708 Sec. 6. This act shall take effect and be in force from and after its
709709 publication in the statute book.
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