Kansas 2025-2026 Regular Session

Kansas House Bill HB2211 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	Session of 2025
2	2	HOUSE BILL No. 2211
3	3	By Committee on Taxation
4	4	Requested by Representative Howerton on behalf of the City of Derby
5	5	2-3
6	6	AN ACT concerning economic development; relating to STAR bonds;
7	7	providing funding to replace lost food sales tax revenue for STAR bond
8	8	districts established prior to December 31, 2022, and modifying the tax
9	9	increment definition for such districts; establishing the STAR bonds
10	10	food sales tax revenue replacement fund; amending K.S.A. 2024 Supp.
11	11	12-17,162 and repealing the existing section.
12	12	Be it enacted by the Legislature of the State of Kansas:
13	13	New Section 1. (a) (1) Commencing on July 15, 2025, and on the 15
14	14	th
15	15	day of each month thereafter, for each STAR bond project district
16	16	established prior to December 31, 2022, the secretary of revenue shall
17	17	certify to the director of the budget and the director of accounts and reports
18	18	the amount of revenue that would have been generated from sales of food
19	19	and food ingredients if the state rate for the Kansas retailers' sales tax
20	20	provided in K.S.A. 79-3603, and amendments thereto, and the Kansas
21	21	compensating use tax provided in K.S.A. 79-3703, and amendments
22	22	thereto, on the sale of food and food ingredients had been 6.5%. The
23	23	secretary of revenue shall certify such amounts for the entirety of the
24	24	month that occurred two months prior, commencing on July 15, 2025, with
25	25	such amounts for the entirety of May 2025.
26	26	(2) On July 15, 2025, for each STAR bond project district established
27	27	prior to December 31, 2022, the secretary of revenue shall also certify to
28	28	the director of the budget and the director of accounts and reports the
29	29	amount of revenue that would have been generated from sales of food and
30	30	food ingredients if the state rate for the Kansas retailers' sales tax provided
31	31	in K.S.A. 79-3603, and amendments thereto, and the Kansas compensating
32	32	use tax provided in K.S.A. 79-3703, and amendments thereto, on the sale
33	33	of food and food ingredients had been 6.5% for the months of January
34	34	2024 through April 2025.
35	35	(b) Commencing on July 25, 2025, and on the 25
36	36	th
37	37	day of each month
38	38	thereafter, the director of accounts and reports shall certify to the state
39	39	treasurer the amounts certified pursuant to subsection (a).
40	40	(c) Commencing on August 1, 2025, and on the 1
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42	42	day of each month
43	43	thereafter, the state treasurer shall transfer from the state general fund to
44	44	the STAR bonds food sales tax revenue replacement fund the aggregate of
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80	80	all amounts certified pursuant to subsection (b). The state treasurer shall
81	81	pay from the STAR bonds food sales tax revenue replacement fund to the
82	82	appropriate city or county bond finance, debt service or reserve fund the
83	83	amount determined to account for the revenue that would have been
84	84	generated as certified pursuant to subsection (b) for each STAR bond
85	85	project district, as provided by subsection (a), established by such city or
86	86	county.
87	87	(d) The secretary of revenue shall determine with respect to each
88	88	STAR bond district, as provided by subsection (a), when the amount of
89	89	sales tax and other revenues that have been collected and distributed to the
90	90	city or county bond finance, debt service or reserve fund, including
91	91	transfers pursuant to this section, is sufficient to satisfy all principal and
92	92	interest costs to the maturity date or dates, of any special obligation bonds
93	93	issued prior to December 31, 2022, with respect to such district.
94	94	Thereafter, no further certifications or transfers of funds as provided by
95	95	this section shall be made for such STAR bond project district.
96	96	(e) There is hereby created in the state treasury the STAR bonds food
97	97	sales tax revenue replacement fund. Such fund shall be administered by
98	98	the state treasurer. All expenditures from the STAR bonds food sales tax
99	99	revenue replacement fund shall be made in accordance with appropriations
100	100	acts upon warrants of the director of accounts and reports issued pursuant
101	101	to vouchers approved by the state treasurer or the state treasurer's
102	102	designee.
103	103	(f) This section shall be a part of and supplemental to the STAR
104	104	bonds financing act.
105	105	Sec. 2. K.S.A. 2024 Supp. 12-17,162 is hereby amended to read as
106	106	follows: 12-17,162. As used in the STAR bonds financing act, unless a
107	107	different meaning clearly appears from the context:
108	108	(a) "Auto race track facility" means: (1) An auto race track facility
109	109	and facilities directly related and necessary to the operation of an auto race
110	110	track facility, including, but not limited to, grandstands, suites and viewing
111	111	areas, concessions, souvenir facilities, catering facilities, visitor and retail
112	112	centers, signage and temporary hospitality facilities, but excluding (2)
113	113	hotels, motels, restaurants and retail facilities, not directly related to or
114	114	necessary to the operation of such facility.
115	115	(b) "Commence work" means the manifest commencement of actual
116	116	operations on the development site, such as, erecting a building,
117	117	excavating the ground to lay a foundation or a basement or work of like
118	118	description according to an approved plan of construction, with the
119	119	intention and purpose to continue work until the project is completed.
120	120	(c) "De minimis" means an amount less than 15% of the land area
121	121	within a STAR bond project district.
122	122	(d) "Developer" means any person, firm, corporation, partnership or
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166	166	limited liability company other than a city and other than an agency,
167	167	political subdivision or instrumentality of the state. "Developer" includes
168	168	the names of the owners, partners, officers or principals of the developer
169	169	for purposes of inclusion of the name of the developer into any
170	170	application, document or report pursuant to this act if such application,
171	171	document or report is a public record.
172	172	(e) "Economic impact study" means a study to project the financial
173	173	benefit of the project to the local, regional and state economies.
174	174	(f) "Eligible area" means a historic theater, major tourism area, major
175	175	motorsports complex, auto race track facility, river walk canal facility,
176	176	major multi-sport athletic complex, major business facility, a major
177	177	commercial entertainment and tourism area or a major professional sports
178	178	complex as determined by the secretary.
179	179	(g) "Feasibility study" means a feasibility study as defined in K.S.A.
180	180	12-17,166(b), and amendments thereto.
181	181	(h) "Historic theater" means a building constructed prior to 1940 that
182	182	was constructed for the purpose of staging entertainment, including motion
183	183	pictures, vaudeville shows or operas, that is operated by a nonprofit
184	184	corporation and is designated by the state historic preservation officer as
185	185	eligible to be on the Kansas register of historic places or is a member of
186	186	the Kansas historic theatre association.
187	187	(i) "Historic theater sales tax increment" means the amount of state
188	188	and local sales tax revenue imposed pursuant to K.S.A. 12-187 et seq., 79-
189	189	3601 et seq. and 79-3701 et seq., and amendments thereto, collected from
190	190	taxpayers doing business within the historic theater that is in excess of the
191	191	amount of such taxes collected prior to the designation of the building as a
192	192	historic theater for purposes of this act.
193	193	(j) "Major business facility" means a significant business
194	194	headquarters or office building development designed to draw a substantial
195	195	number of new visitors to Kansas and that has agreed to provide visitor
196	196	tracking data to the secretary as requested by the secretary, including, but
197	197	not limited to, residence zip code information, to be provided or held by
198	198	the secretary without personally identifiable information. A major business
199	199	facility shall meet sales tax increment revenue requirements that shall be
200	200	established by the secretary independent of any associated retail businesses
201	201	located in the STAR bond project district pursuant to the STAR bond
202	202	project plan.
203	203	(k) "Major commercial entertainment and tourism area" means an
204	204	area that may include, but not be limited to, a major multi-sport athletic
205	205	complex.
206	206	(l) "Major motorsports complex" means a complex in Shawnee
207	207	county that is utilized for the hosting of competitions involving motor
208	208	vehicles, including, but not limited to, automobiles, motorcycles or other
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252	252	self-propelled vehicles other than a motorized bicycle or motorized
253	253	wheelchair. Such project may include racetracks, all facilities directly
254	254	related and necessary to the operation of a motorsports complex,
255	255	including, but not limited to, parking lots, grandstands, suites and viewing
256	256	areas, concessions, souvenir facilities, catering facilities, visitor and retail
257	257	centers, signage and temporary hospitality facilities, but excluding hotels,
258	258	motels, restaurants and retail facilities not directly related to or necessary
259	259	to the operation of such facility.
260	260	(m) "Major tourism area" means an area for which the secretary has
261	261	made a finding the capital improvements costing not less than
262	262	$100,000,000 will be built in the state to construct an auto race track
263	263	facility.
264	264	(n) "Major multi-sport athletic complex" means an athletic complex
265	265	that is utilized for the training of athletes, the practice of athletic teams, the
266	266	playing of athletic games or the hosting of events. Such project may
267	267	include playing fields, parking lots and other developments including
268	268	grandstands, suites and viewing areas, concessions, souvenir facilities,
269	269	catering facilities, visitor centers, signage and temporary hospitality
270	270	facilities, but excluding hotels, motels, restaurants and retail facilities, not
271	271	directly related to or necessary to the operation of such facility.
272	272	(o) "Major professional sports complex" means a project, approved or
273	273	pursuant to an authorized agreement as provided by K.S.A. 2024 Supp. 12-
274	274	17,181, and amendments thereto, located within this state including a
275	275	stadium of not less than 30,000 seats for the purpose of the holding of
276	276	national football league or major league baseball athletic contests and
277	277	other events and gatherings or a practice or training facility utilized by a
278	278	major professional sports franchise and all buildings, improvements,
279	279	facilities or attractions located within any STAR bond project district as
280	280	defined in subsection (cc)(2).
281	281	(p) "Major professional sports franchise" means any corporation,
282	282	partnership or other entity that owns a team or franchise that is a member
283	283	of the national football league or major league baseball that is located in
284	284	any state adjacent to Kansas.
285	285	(q) "Market study" means a study to determine the ability of the
286	286	project to gain market share locally, regionally and nationally and the
287	287	ability of the project to gain sufficient market share to:
288	288	(1) Remain profitable past the term of repayment; and
289	289	(2) maintain status as a significant factor for travel decisions.
290	290	(r) "Market impact study" means a study to measure the impact of the
291	291	proposed project on similar businesses in the project's market area.
292	292	(s) "Museum facility" means a separate newly-constructed museum
293	293	building and facilities directly related and necessary to the operation
294	294	thereof, including gift shops and restaurant facilities, but excluding hotels,
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338	338	motels, restaurants and retail facilities not directly related to or necessary
339	339	to the operation of such facility. The museum facility shall be owned by
340	340	the state, a city, county, other political subdivision of the state or a non-
341	341	profit corporation, shall be managed by the state, a city, county, other
342	342	political subdivision of the state or a non-profit corporation and may not
343	343	be leased to any developer and shall not be located within any retail or
344	344	commercial building.
345	345	(t) "Project" means a STAR bond project.
346	346	(u) "Project costs" means those costs necessary to implement a STAR
347	347	bond project plan, including costs incurred for:
348	348	(1) Acquisition of real property within the STAR bond project area;
349	349	(2) payment of relocation assistance pursuant to a relocation
350	350	assistance plan as provided in K.S.A. 12-17,173, and amendments thereto;
351	351	(3) site preparation including utility relocations;
352	352	(4) sanitary and storm sewers and lift stations;
353	353	(5) drainage conduits, channels, levees and river walk canal facilities;
354	354	(6) street grading, paving, graveling, macadamizing, curbing,
355	355	guttering and surfacing;
356	356	(7) street light fixtures, connection and facilities;
357	357	(8) underground gas, water, heating and electrical services and
358	358	connections located within the public right-of-way;
359	359	(9) sidewalks and pedestrian underpasses or overpasses;
360	360	(10) drives and driveway approaches located within the public right-
361	361	of-way;
362	362	(11) water mains and extensions;
363	363	(12) plazas and arcades;
364	364	(13) parking facilities and multilevel parking structures devoted to
365	365	parking only;
366	366	(14) landscaping and plantings, fountains, shelters, benches,
367	367	sculptures, lighting, decorations and similar amenities;
368	368	(15) auto race track facility;
369	369	(16) major multi-sport athletic complex;
370	370	(17) museum facility;
371	371	(18) major motorsports complex;
372	372	(19) rural redevelopment project, including costs incurred in
373	373	connection with the construction or renovation of buildings or other
374	374	structures;
375	375	(20) major professional sports complex, including all costs necessary
376	376	to implement a STAR bond project plan for the development of a major
377	377	professional sports complex, including, but not limited to, costs incurred
378	378	for construction or renovation of a stadium and other buildings,
379	379	improvements, structures, facilities, infrastructure improvements and
380	380	utilities or any related expenses to develop and finance such complex;
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424	424	(21) related expenses to redevelop and finance the project, except that
425	425	for a STAR bond project financed with special obligation bonds payable
426	426	from the revenues described in K.S.A. 12-17,169(a)(1) or (a)(2)(A) and (a)
427	427	(2)(B), and amendments thereto, such expenses shall require prior
428	428	approval by the secretary of commerce; and
429	429	(22) except as specified in paragraphs (1) through (21) above,
430	430	"project costs" does not include:
431	431	(A) Costs incurred in connection with the construction of buildings or
432	432	other structures;
433	433	(B) fees and commissions paid to developers, real estate agents,
434	434	financial advisors or any other consultants who represent the developers or
435	435	any other businesses considering locating in or located in a STAR bond
436	436	project district;
437	437	(C) salaries for local government employees;
438	438	(D) moving expenses for employees of the businesses locating within
439	439	the STAR bond project district;
440	440	(E) property taxes for businesses that locate in the STAR bond project
441	441	district;
442	442	(F) lobbying costs;
443	443	(G) any bond origination fee charged by the city or county;
444	444	(H) any personal property as defined in K.S.A. 79-102, and
445	445	amendments thereto; and
446	446	(I) travel, entertainment and hospitality.
447	447	(v) "Projected market area" means any area within the state in which
448	448	the project is projected to have a substantial fiscal or market impact upon
449	449	businesses in such area.
450	450	(w) "River walk canal facilities" means a canal and related water
451	451	features which that flow through a major commercial entertainment and
452	452	tourism area and facilities related or contiguous thereto, including, but not
453	453	limited to, pedestrian walkways and promenades, landscaping and parking
454	454	facilities.
455	455	(x) "Rural redevelopment project" means a project that is in an area
456	456	outside of a metropolitan area with a population of more than 50,000, that
457	457	is of regional importance, with capital investment of at least $3,000,000
458	458	and that will enhance the quality of life in the community and region.
459	459	(y) "Sales tax and revenue" are those revenues available to finance
460	460	the issuance of special obligation bonds as identified in K.S.A. 12-17,168,
461	461	and amendments thereto.
462	462	(z) "STAR bond" means a sales tax and revenue bond.
463	463	(aa) "STAR bond project" means:
464	464	(1) An approved project to implement a project plan for the
465	465	development of the established STAR bond project district that:
466	466	(A) (i) Has at least a $75,000,000 capital investment and $75,000,000
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510	510	in projected gross annual sales; or
511	511	(ii) for metropolitan areas with a population of between 50,000 and
512	512	75,000, has at least a $40,000,000 capital investment and $40,000,000 in
513	513	projected gross annual sales, if the project is deemed of high value by the
514	514	secretary; or
515	515	(B) for areas outside of metropolitan areas with a population of more
516	516	than 50,000, the secretary finds the project:
517	517	(i) Is an eligible area as defined in subsection (f); and
518	518	(ii) would be of regional or statewide importance;
519	519	(C) is a major tourism area as defined in subsection (m);
520	520	(D) is a major motorsports complex, as defined in subsection (l); or
521	521	(E) is a rural redevelopment project as defined in subsection (x); or
522	522	(2) A project approved or pursuant to an authorized agreement as
523	523	provided by K.S.A. 2024 Supp. 12-17,181, and amendments thereto, to
524	524	implement one or more project plans for the development of a major
525	525	professional sports complex with a combined capital investment of not less
526	526	than $1,000,000,000.
527	527	(bb) "STAR bond project area" means the geographic area within the
528	528	STAR bond project district in which there may be one or more projects.
529	529	(cc) "STAR bond project district" means:
530	530	(1) The specific area declared to be an eligible area as determined by
531	531	the secretary in which the city or county may develop one or more STAR
532	532	bond projects. A "STAR bond project district" includes a redevelopment
533	533	district, as defined in K.S.A. 12-1770a, and amendments thereto, created
534	534	prior to the effective date of this act for the Wichita Waterwalk project in
535	535	Wichita, Kansas, provided, the city creating such redevelopment district
536	536	submits an application for approval for STAR bond financing to the
537	537	secretary on or before July 31, 2007, and receives a final letter of
538	538	determination from the secretary approving or disapproving the request for
539	539	STAR bond financing on or before November 1, 2007. No STAR bond
540	540	project district shall include real property which that has been part of
541	541	another STAR bond project district unless such STAR bond project and
542	542	STAR bond project district have been approved by the secretary of
543	543	commerce pursuant to K.S.A. 12-17,164 and 12-17,165, and amendments
544	544	thereto, prior to March 1, 2016. A STAR bond project district in a
545	545	metropolitan area with a population of more than 50,000, shall be a
546	546	contiguous parcel of real estate and shall be limited to those areas being
547	547	developed by the STAR bond project and any area of real property
548	548	reasonably anticipated to directly benefit from the redevelopment project;
549	549	or
550	550	(2) the specific area approved or pursuant to an authorized agreement
551	551	as provided by K.S.A. 2024 Supp. 12-17,181, and amendments thereto,
552	552	and that is declared to be an eligible area as determined by the secretary in
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596	596	which the city or county, or the secretary independently or with the
597	597	participation of the city or county, as provided by K.S.A. 12-17,164, and
598	598	amendments thereto, may develop one or more STAR bond projects as
599	599	defined in subsection (aa)(2). Such area may include real property that is
600	600	or has been a part of another STAR bond project district, however, any
601	601	outstanding STAR bonds issued for such other STAR bond project district
602	602	shall have priority for repayment. Any STAR bond project district as
603	603	defined pursuant to this paragraph shall not be required to contain
604	604	contiguous parcels of real estate or be limited to those areas being
605	605	developed pursuant to any such STAR bond project.
606	606	(dd) "STAR bond project district plan" means the preliminary plan
607	607	that identifies all of the proposed STAR bond project areas and identifies
608	608	in a general manner all of the buildings, facilities and improvements in
609	609	each that are proposed to be constructed or improved in each STAR bond
610	610	project area.
611	611	(ee) "STAR bond project plan" means the plan adopted by a city or
612	612	county for the development of a STAR bond project or projects in a STAR
613	613	bond project district. "STAR bond project plan" includes a plan adopted by
614	614	the secretary independently, the secretary with the participation of a city or
615	615	county or a city or county as approved by the secretary, as provided by
616	616	K.S.A. 12-17,164, and amendments thereto, for the development of a
617	617	STAR bond project or projects as defined in subsection (aa)(2) in a STAR
618	618	bond project district as defined in subsection (cc)(2) and approved or
619	619	pursuant to an authorized agreement as provided by K.S.A. 2024 Supp. 12-
620	620	17,181, and amendments thereto.
621	621	(ff) "Secretary" means the secretary of commerce.
622	622	(gg) "Substantial change" means, as applicable, a change wherein the
623	623	proposed plan or plans differ substantially from the intended purpose for
624	624	which the STAR bond project district plan was approved.
625	625	(hh) "Tax increment" means:
626	626	(1) Except as provided in paragraph (2), that portion of the revenue
627	627	derived from state and local sales, use and transient guest tax imposed
628	628	pursuant to K.S.A. 12-187 et seq., 12-1692 et seq., 79-3601 et seq. and 79-
629	629	3701 et seq., and amendments thereto, collected from taxpayers doing
630	630	business within that portion of a STAR bond project district occupied by a
631	631	project that is in excess of the amount of base year revenue. For purposes
632	632	of this subsection, the base year shall be the 12-month period immediately
633	633	prior to the month in which the STAR bond project district is established.
634	634	The department of revenue shall determine base year revenue by reference
635	635	to the revenue collected during the base year from taxpayers doing
636	636	business within the specific area in which a STAR bond project district is
637	637	subsequently established. The base year of a STAR bond project district,
638	638	following the addition of area to the STAR bond project district, shall be
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682	682	the base year for the original area, and with respect to the additional area,
683	683	the base year shall be any 12-month period immediately prior to the month
684	684	in which additional area is added to the STAR bond project district. For
685	685	purposes of this subsection, revenue collected from taxpayers doing
686	686	business within a STAR bond project district, or within a specific area in
687	687	which a STAR bond project district is subsequently established shall not
688	688	include local sales and use tax revenue that is sourced to jurisdictions other
689	689	than those in which the project is located. The secretary of revenue and the
690	690	secretary of commerce shall certify the appropriate amount of base year
691	691	revenue for taxpayers relocating from within the state into a STAR bond
692	692	district. For STAR bond project districts with a base year established prior
693	693	to December 31, 2022, there shall be added to the tax increment an
694	694	amount equal to the amount of state sales and use tax revenue that would
695	695	have been derived from the sale of food and food ingredients within the
696	696	district. For STAR bond project districts established on or after December
697	697	31, 2022, the base year revenue shall not include revenue resulting from
698	698	state sales and use tax on the sale of food and food ingredients within the
699	699	district.
700	700	(2) With respect to any STAR bond project district as defined in
701	701	subsection (cc)(2), "tax increment" may include all revenue described in
702	702	paragraph (1) collected from retail sales from any business within such
703	703	STAR bond project district. "Tax increment" shall include all revenue
704	704	derived from the sale of alcoholic liquor as defined in K.S.A. 79-41a01,
705	705	and amendments thereto, pursuant to K.S.A. 79-4101 and 79-41a02, and
706	706	amendments thereto, collected from consumers purchasing alcoholic
707	707	liquor within such STAR bond project district that is in excess of the
708	708	amount of base year revenue for such taxes. The "tax increment" for any
709	709	such STAR bond project district that has been independently established
710	710	by the secretary as provided by K.S.A. 12-17,164, and amendments
711	711	thereto, shall not include local sales, use or transient guest tax imposed
712	712	pursuant to K.S.A. 12-187 et seq. and 12-1692 et seq., and amendments
713	713	thereto, unless approved by a participating city or county as provided by
714	714	K.S.A. 12-17,164, and amendments thereto. If a STAR bond project
715	715	district as defined in subsection (cc)(2) includes real property that is or has
716	716	been part of another previously approved STAR bond project district, the
717	717	"tax increment" shall also exclude that portion of state and local sales, use
718	718	or transient guest tax revenue pledged to repayment of any STAR bonds
719	719	issued for a previously approved STAR bond project within such other
720	720	district while such bonds are outstanding. The amount of base year
721	721	revenue for any revenue derived from the sale of alcoholic liquor and any
722	722	state sales and use taxes shall be set by the secretary in the secretary's sole
723	723	discretion upon the establishment of a STAR bond project district as
724	724	defined in K.S.A. 12-17,162(cc)(2), and amendments thereto. If local
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768	768	sales, use or transient guest tax revenue are also pledged by a city or
769	769	county, whether such city or county is participating with the secretary, or is
770	770	itself establishing such STAR bond project district, as provided by K.S.A.
771	771	12-17,164, and amendments thereto, the amount of base year revenue for
772	772	such local tax revenues shall be set by the city or county in the city or
773	773	county's discretion and approved by the secretary. Base year revenue
774	774	determinations by the secretary or by the city or county as approved by the
775	775	secretary shall not be required to be based on the procedure provided in
776	776	paragraph (1).
777	777	(ii) "Taxpayer" means a person, corporation, limited liability
778	778	company, S corporation, partnership, registered limited liability
779	779	partnership, foundation, association, nonprofit entity, sole proprietorship,
780	780	business trust, group or other entity that is subject to the Kansas income
781	781	tax act, K.S.A. 79-3201 et seq., and amendments thereto.
782	782	Sec. 3. K.S.A. 2024 Supp. 12-17,162 is hereby repealed.
783	783	Sec. 4. This act shall take effect and be in force from and after its
784	784	publication in the statute book.
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