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AN ACT relating to economic development. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
SECTION 1. SUBCHAPTER 21 OF KRS CHAPTER 154 IS ESTABLISHED, 3
AND A NEW SECTION THEREOF IS CREATED TO READ AS FOLLOWS: 4
The General Assembly finds and declares that the purpose of Sections 1 to 8 of this Act 5
is to support economic development and job growth across this Commonwealth. In 6
enacting this legislation, it is the intention of the General Assembly to enable the 7
Cabinet for Economic Development to enter into a partnership with the Kentucky 8
Association for Economic Development for the purposes of this program, herein 9
known as the Kentucky Product Development Initiative, and to administer program 10
funds to achieve this purpose. 11
SECTION 2. A NEW SECTION OF SUBCHAPTER 21 OF KRS CHAPTER 12
154 IS CREATED TO READ AS FOLLOWS: 13
As used in Sections 1 to 8 of this Act: 14
(1) "Cabinet" means the Cabinet for Economic Development; 15
(2) "Eligible grant recipient" means a grant applicant that is a local government or 16
an economic development authority in an economic development district in this 17
Commonwealth that is engaged in an eligible project; 18
(3) "Eligible project" means an economic development project that is initiated on 19
publicly owned property or on property on which a public entity has an option to 20
purchase or lease, and that satisfies the evaluation criteria in Section 7 of this 21
Act; and 22
(4) "Eligible use" means the authorized purpose for which an awarded grant may be 23
used. "Eligible use" includes an expenditure in any of the following categories or 24
some combination thereof: 25
(a) Due diligence study; 26
(b) Property acquisition; 27 UNOFFICIAL COPY 22 RS HB 745/GA
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(c) Infrastructure extension or improvement; 1
(d) Site preparation work; or 2
(e) Road improvement. 3
SECTION 3. A NEW SECTION OF SUBCHAPTER 21 OF KRS CHAPTER 4
154 IS CREATED TO READ AS FOLLOWS: 5
(1) The Kentucky Product Development Initiative is hereby established under the 6
cabinet. The cabinet shall partner with the Kentucky Association for Economic 7
Development to administer the program. 8
(2) In order to administer the program the cabinet shall: 9
(a) Authorize the Kentucky Association for Economic Development to contract 10
with a third party to perform its duties in the administration of the program; 11
(b) Create and make available a standardized grant application on an annual 12
basis pursuant to Section 6 of this Act; 13
(c) Develop a standardized scoring system pursuant to Section 8 of this Act; 14
(d) Review the proposed grant recipients submitted by the Kentucky Association 15
for Economic Development; 16
(e) Verify the eligibility of the proposed grant recipients; 17
(f) Verify that the proposed grant recipient seeks grant money for an eligible 18
use prior to awarding the grant; 19
(g) Approve the grant recipients from the recommendations made by the 20
Kentucky Association for Economic Development and award grants 21
matching the selected grant recipient's contribution to its eligible project on 22
a dollar-for-dollar basis up to one million dollars ($1,000,000); 23
(h) Verify that the grant recipient completes the eligible project; and 24
(i) Administer the fund created in Section 4 of this Act to achieve the 25
program's purpose. 26
(3) The cabinet shall promulgate administrative regulations in accordance with KRS 27 UNOFFICIAL COPY 22 RS HB 745/GA
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Chapter 13A to effectuate Sections 1 to 8 of this Act. 1
SECTION 4. A NEW SECTION OF SUBCHAPTER 21 OF KRS CHAPTER 2
154 IS CREATED TO READ AS FOLLOWS: 3
(1) There is hereby established in the State Treasury a restricted fund to be known as 4
the Kentucky product development initiative fund. The fund shall consist of 5
moneys appropriated by the General Assembly. 6
(2) The fund shall be administered by the cabinet. 7
(3) Notwithstanding KRS 45.229, any moneys remaining in the fund at the close of 8
the fiscal year shall not lapse but shall be carried forward to the next fiscal year. 9
(4) Any interest earnings of the fund shall become part of the fund and shall not 10
lapse. 11
(5) Moneys deposited in the fund are hereby appropriated for the purposes set forth 12
in Sections 1 to 8 of this Act and shall not be appropriated or transferred by the 13
General Assembly for any other purpose. 14
(6) The cabinet shall disburse moneys from the fund to the selected grant recipients 15
and the amount of each grant shall match the selected grant recipient's 16
contribution to the eligible project on a dollar-for-dollar basis up to one million 17
dollars ($1,000,000) pursuant to subsection (2)(g) of Section 3 of this Act. 18
SECTION 5. A NEW SECTION OF SUBCHAPTER 21 OF KRS CHAPTER 19
154 IS CREATED TO READ AS FOLLOWS: 20
(1) To participate in the Kentucky Product Development Initiative, grant applicants 21
shall submit an application to the Kentucky Association for Economic 22
Development in accordance with administrative regulations promulgated by the 23
cabinet pursuant to Section 3 of this Act. 24
(2) If a grant applicant is selected as a grant recipient, it shall comply with any 25
reporting requirements deemed necessary by the cabinet to verify that the 26
awarded grant goes toward an eligible use. 27 UNOFFICIAL COPY 22 RS HB 745/GA
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(3) If the selected grant recipient fails to comply with subsection (2) of this section or 1
uses the awarded grant money for any purpose other than an eligible use, the 2
selected grant recipient shall forfeit and be liable to the cabinet for the full award 3
amount. 4
SECTION 6. A NEW SECTION OF SUBCHAPTER 21 OF KRS CHAPTER 5
154 IS CREATED TO READ AS FOLLOWS: 6
(1) In the implementation of the Kentucky Product Development Initiative, the 7
Kentucky Association for Economic Development shall: 8
(a) Process the grant applications; 9
(b) Determine whether a grant applicant is an eligible grant recipient and 10
seeking a grant for an eligible use; 11
(c) Evaluate the project site cited or proposed by each grant applicant in 12
accordance with the program's evaluation model described in Section 7 of 13
this Act; 14
(d) Score each grant applicant's project pursuant to the scoring system 15
described in Section 8 of this Act; 16
(e) Provide detailed feedback to all grant applicants after the project site 17
evaluation and project score are completed; 18
(f) Rank the grant applicants: 19
1. In a manner that prioritizes the greatest return on investment, 20
workforce creation, and relative positive impact on the community; 21
and 22
2. Based on the project site evaluation and subsequent project score 23
described in Sections 7 and 8 of this Act; 24
(g) Compile a list of proposed grant recipients whose eligible project 25
demonstrates a high level of investment potential if a grant is made, as 26
revealed by the evaluation, scoring, and ranking process described in this 27 UNOFFICIAL COPY 22 RS HB 745/GA
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section and Sections 7 and 8 of this Act; 1
(h) Submit the proposed grant recipients and their ranking to the cabinet for 2
final selection of the grant recipients; and 3
(i) Compile an annual report for the cabinet conveying the following 4
information about the program: 5
1. A list of all the program applicants; 6
2. A list of all applicants who were not selected; 7
3. Trends found in feedback given to applicants who were not selected; 8
4. Eligibility of the properties cited in the grant applications; and 9
5. Any other information requested by the cabinet. 10
(2) The Kentucky Association for Economic Development may contract with a third 11
party to assist with the grant applicant site evaluations, scoring, and ranking 12
described in this section and Sections 7 and 8 of this Act. 13
SECTION 7. A NEW SECTION OF SUBCHAPTER 21 OF KRS CHAPTER 14
154 IS CREATED TO READ AS FOLLOWS: 15
(1) The Kentucky Association for Economic Development shall evaluate each 16
applicant's eligible project according to the criteria described in this section and 17
Section 8 of this Act for the purposes of compiling a score for the eligible project 18
and project site pursuant to Section 8 of this Act. 19
(2) The Kentucky Association for Economic Development shall evaluate the project 20
site according to the requirements in the following five (5) categories: 21
(a) Property availability as described in subsection (3) of this section; 22
(b) Property development ability as described in subsection (4) of this section; 23
(c) Zoning availability as described in subsection (5) of this section; 24
(d) Transportation accessibility as described in subsection (6) of this section; 25
and 26
(e) Utility adequacy as described in subsection (7) of this section. 27 UNOFFICIAL COPY 22 RS HB 745/GA
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(3) The property that the eligible project occupies or is proposed to occupy shall be 1
available. Property shall be deemed available for the purposes of this program if 2
the property is: 3
(a) Publicly owned; or 4
(b) Under option for sale or lease to a public entity as evidenced by legal 5
documentation containing the material terms of the sale or lease. 6
(4) The property that the eligible project occupies or is proposed to occupy shall be 7
developable. Property shall be deemed developable if: 8
(a) The acreage intended for development is clearly defined by either: 9
1. The grant applicant; or 10
2. An engineering partner during or after a site visit, if the applicant is 11
unable to define the developable acreage; and 12
(b) The property is free of impediments to development, or a known impediment 13
can be mitigated by a grant applicant. A property is free of impediments if 14
it: 15
1. Is located outside of the one hundred (100) year and five hundred 16
(500) year flood zone; 17
2. Is free of recognized environmental conditions; 18
3. Is free of wetlands; 19
4. Is free of state and federally threatened and endangered species; 20
5. Is free of areas of archaeological or historical significance; and 21
6. Possesses soils compatible with the grant applicant's intended 22
development. 23
(5) The property that the eligible project occupies or is proposed to occupy shall be 24
appropriately zoned for the intended use or shall be able to be rezoned within 25
ninety (90) calendar days. The properties surrounding the grant applicant's 26
project site shall be zoned so they are compatible with the grant applicant's 27 UNOFFICIAL COPY 22 RS HB 745/GA
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intended development and use of the project site. 1
(6) The property that the eligible project occupies or is proposed to occupy shall be 2
directly served by a road or roads that are compatible with the intended use of the 3
property. Additionally, if the property is marketed as rail-served, the property 4
shall be deemed rail-served if: 5
(a) The grant applicant provides documentation from the rail provider that 6
evinces that rail infrastructure exists and the rail provider actually provides 7
rail service; or 8
(b) If the rail service does not exist at the time of the grant application, the 9
grant applicant provides documentation from the rail provider that evinces 10
that the project site will be able to be rail-served within twelve (12) months. 11
(7) The property that the eligible project occupies or is proposed to occupy shall have 12
access to adequate utilities and shall be served or able to be served by the 13
following: 14
(a) Electric infrastructure; 15
(b) Natural gas; 16
(c) Water infrastructure and a public water system; 17
(d) Wastewater infrastructure and a public wastewater treatment plant, 18
excluding a septic wastewater treatment system; and 19
(e) Fiber telecommunications infrastructure. 20
SECTION 8. A NEW SECTION OF SUBCHAPTER 21 OF KRS CHAPTER 21
154 IS CREATED TO READ AS FOLLOWS: 22
(1) The cabinet, in partnership with the Kentucky Association for Economic 23
Development, shall develop a scoring system for the project and the project site 24
proposed by each grant applicant based on the total projected return on 25
investment, the workforce development, and the relative positive impact in the 26
community. 27 UNOFFICIAL COPY 22 RS HB 745/GA
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(2) The cabinet shall develop a scoring system that includes a: 1
(a) Score in each category as specified by the cabinet in subsection (3) of this 2
section; and 3
(b) Total weighted score, which is the average of the scores in each category. 4
(3) The scoring system shall include but is not limited to: 5
(a) Projected return on investment the project will yield, which includes an 6
assessment of the: 7
1. Likelihood of project completion at the applicant's proposed site, both 8
with the cabinet's funding and without; 9
2. Projected gross economic impact of the proposed project on the 10
community; 11
3. Projected number of jobs created by the proposed project and 12
subsequent impact on the community; and 13
4. Return on investment, which is a determination of the cost of the job 14
based on the cost expended by the cabinet if it awards the requested 15
grant amount to the applicant; 16
(b) Impact on workforce development, including an assessment of objective 17
workforce data for the community in which the project is located; and 18
(c) Relative positive impact the project will have on the surrounding 19
community. 20
Section 9. This Act may be cited as the Kentucky Product Development 21
Initiative Act. 22