UNOFFICIAL COPY 24 RS BR 1147
Page 1 of 10
XXXX 2/7/2024 10:47 AM Jacketed
AN ACT relating to property fees and making an appropriation therefor. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
SECTION 1. A NEW SECTION OF KRS CHAPTER 75 IS CREATED TO 3
READ AS FOLLOWS: 4
(1) As used in this section, "premises" has the same meaning as in KRS 138.208. 5
(2) (a) The board of trustees of a fire protection district or subdistrict, or a 6
volunteer fire department district, may assess a fee against a premises 7
within its jurisdiction to cover the actual costs of services and materials 8
required to maintain necessary fire protection measures for that premises. 9
(b) In setting the amount of the fee authorized by paragraph (a) of this 10
subsection, the board of trustees shall determine expenses related to fire 11
protection measures for the premises, including but not limited to: 12
1. Fire prevention inspections; 13
2. Firefighting equipment purchases and maintenance; 14
3. The actual resources used for fire protection services; 15
4. The market value of materials used; and 16
5. Any other measures deemed essential in providing fire protection to 17
the premises. 18
(3) The board of trustees may: 19
(a) Directly bill the owner of the premises for the fee authorized by subsection 20
(2) of this section. In addition, the board of trustees may set a monetary 21
penalty for nonpayment or late payment of the fee, and may issue a lien on 22
the property against which the fee was levied; or 23
(b) 1. Request the fiscal court of the county in which the fire protection 24
district or subdistrict, or volunteer fire department district, has 25
territory containing the premises to adopt an ordinance to add the fee 26
to the property tax bill sent to the owner of the premises. 27 UNOFFICIAL COPY 24 RS BR 1147
Page 2 of 10
XXXX 2/7/2024 10:47 AM Jacketed
2. In any county where the fiscal court has adopted an ordinance under 1
this paragraph, the county clerk shall add the fee to the tax bills of the 2
owner of the premises in a place separate from the taxes and other 3
fees on the bill so that the taxpayer can ascertain the amount of the 4
fee apart from the taxes and other fees on the bill. 5
3. Fees added to property tax bills under this paragraph shall be 6
collected and distributed by the sheriff to the applicable board of 7
trustees in the same manner as other taxes on the bill. Unpaid fees 8
shall bear the same penalty as general state and county property taxes, 9
and this shall be a lien on the property against which is levied from 10
the time of the levy. The fiscal court shall, in the ordinance, and in 11
consultation with the sheriff and the applicable board of trustees, set a 12
collection fee for the sheriff to retain in an amount not to exceed four 13
and one-fourth percent (4.25%) of the fee collected. 14
(4) (a) If the board of trustees directly bills the owner of the premises for the fee 15
authorized by subsection (2) of this section, the board shall issue a detailed 16
invoice specifying the incurred costs to the owner of the respective premises. 17
The invoice shall notify the owner of the premises of the appeals process set 18
out in subsection (5) of this section and include contact information for the 19
Kentucky Fire Commission to initiate an appeal. 20
(b) If the county fiscal court has adopted an ordinance placing the fee 21
authorized by subsection (2) of this section on the county tax bill, then the 22
board of trustees shall issue a document detailing the incurred costs to the 23
owner of the respective premises that also explains that the fee will be added 24
to the tax bill. The document shall be issued no later than September 1 of 25
each year. The document shall notify the owner of the premises of the 26
appeals process set out in subsection (5) of this section and include contact 27 UNOFFICIAL COPY 24 RS BR 1147
Page 3 of 10
XXXX 2/7/2024 10:47 AM Jacketed
information for the Kentucky Fire Commission to initiate an appeal. 1
(5) (a) The owner of a premises who believes the fee assessed against the premises 2
pursuant to this section is unjust or inaccurately assessed may appeal the 3
fee and have the issue brought before the Kentucky Fire Commission for 4
arbitration. The appeal shall be entered within sixty (60) days of the 5
issuance of the invoice under subsection (4)(a) of this section, or within 6
sixty (60) days of the issuance of the document set out in subsection (4)(b) 7
of this section. 8
(b) The board of trustees shall immediately reimburse the owners of the 9
premises of any fee paid and adjusted in favor of the owner of the premises. 10
Any penalties levied for nonpayment of the fee billed by the board or added 11
to a tax bill shall be adjusted to reflect the judgment of the Kentucky Fire 12
Commission after arbitration. 13
(c) The Kentucky Fire Commission shall promulgate administrative regulations 14
in accordance with KRS Chapter 13A to provide for the arbitration process 15
set out in this section. 16
(6) No later than December 31 of each year, the board of trustees collecting a fee 17
under this section shall transmit a report to the Kentucky Fire Commission 18
containing: 19
(a) Every invoice or document sent to the owners of each premises as set out in 20
subsection (4) of this section, including any adjustments made as a result of 21
an appeal set out in subsection (5) of this section; 22
(b) An incident report listing when the fire protection district or subdistrict, or 23
volunteer fire department district responded to a premises during that year 24
or provided any inspections or other services directly to that premises; and 25
(c) A discussion of any difficulties faced by the board of trustees in 26
implementing this section. 27 UNOFFICIAL COPY 24 RS BR 1147
Page 4 of 10
XXXX 2/7/2024 10:47 AM Jacketed
SECTION 2. A NEW SECTION OF KRS CHAPTER 75A IS CREATED TO 1
READ AS FOLLOWS: 2
(1) As used in this section, "premises" has the same meaning as in KRS 138.208. 3
(2) (a) The board of a district may assess a fee against a premises within its 4
jurisdiction to cover the actual costs of services and materials required to 5
maintain necessary fire protection measures for that premises. 6
(b) In setting the amount of the fee authorized by paragraph (a) of this 7
subsection, the board shall determine expenses related to fire protection 8
measures for the premises, including but not limited to: 9
1. Fire prevention inspections; 10
2. Firefighting equipment purchases and maintenance; 11
3. The actual resources used for fire protection services; 12
4. The market value of materials used; and 13
5. Any other measures deemed essential in providing fire protection to 14
the premises. 15
(3) The board may: 16
(a) Directly bill the owner of the premises for the fee authorized by subsection 17
(2) of this section. In addition, the board may set a monetary penalty for 18
nonpayment or late payment of the fee, and may issue a lien on the property 19
against which the fee was levied; or 20
(b) 1. Request the fiscal court of the county in which the district has territory 21
containing the premises to adopt an ordinance to add the fee to the 22
property tax bill sent to the owner of the premises. 23
2. In any county where the fiscal court has adopted an ordinance under 24
this paragraph, the county clerk shall add the fee to the tax bills of the 25
owner of the premises in a place separate from the taxes and other 26
fees on the bill so that the taxpayer can ascertain the amount of the 27 UNOFFICIAL COPY 24 RS BR 1147
Page 5 of 10
XXXX 2/7/2024 10:47 AM Jacketed
fee apart from the taxes and other fees on the bill. 1
3. Fees added to property tax bills under this paragraph shall be 2
collected and distributed by the sheriff to the applicable board in the 3
same manner as other taxes on the bill. Unpaid fees shall bear the 4
same penalty as general state and county property taxes, and this shall 5
be a lien on the property against which is levied from the time of the 6
levy. The fiscal court shall, in the ordinance, and in consultation with 7
the sheriff and the applicable board, set a collection fee for the sheriff 8
to retain in an amount not to exceed four and one-fourth percent 9
(4.25%) of the fee collected. 10
(4) (a) If the board directly bills the owner of the premises for the fee authorized by 11
subsection (2) of this section, the board shall issue a detailed invoice 12
specifying the incurred costs to the owner of the respective premises. The 13
invoice shall notify the owner of the premises of the appeals process set out 14
in subsection (5) of this section and include contact information for the 15
Kentucky Fire Commission to initiate an appeal. 16
(b) If the county fiscal court has adopted an ordinance placing the fee 17
authorized by subsection (2) of this section on the county tax bill, then the 18
board shall issue a document detailing the incurred costs to the owner of the 19
respective premises that also explains that the fee will be added to the tax 20
bill. The document shall be issued no later than September 1 of each year. 21
The document shall notify the owner of the premises of the appeals process 22
set out in subsection (5) of this section and include contact information for 23
the Kentucky Fire Commission to initiate an appeal. 24
(5) (a) The owner of a premises who believes the fee assessed against the premises 25
pursuant to this section is unjust or inaccurately assessed may appeal the 26
fee and have the issue brought before the Kentucky Fire Commission for 27 UNOFFICIAL COPY 24 RS BR 1147
Page 6 of 10
XXXX 2/7/2024 10:47 AM Jacketed
arbitration. The appeal shall be entered within sixty (60) days of the 1
issuance of the invoice under subsection (4)(a) of this section, or within 2
sixty (60) days of the issuance of the document set out in subsection (4)(b) 3
of this section. 4
(b) The board shall immediately reimburse the owners of the premises of any 5
fee paid and adjusted in favor of the owner of the premises. Any penalties 6
levied for nonpayment of the fee billed by the board or added to a tax bill 7
shall be adjusted to reflect the judgment of the Kentucky Fire Commission 8
after arbitration. 9
(c) The Kentucky Fire Commission shall promulgate administrative regulations 10
in accordance with KRS Chapter 13A to provide for the arbitration process 11
set out in this section. 12
(6) No later than December 31 of each year, the board collecting a fee under this 13
section shall transmit a report to the Kentucky Fire Commission containing: 14
(a) Every invoice or document sent to the owners of each premises as set out in 15
subsection (4) of this section, including any adjustments made as a result of 16
an appeal set out in subsection (5) of this section; 17
(b) An incident report listing when the district responded to a premises during 18
that year or provided any inspections or other services directly to that 19
premises; and 20
(c) A discussion of any difficulties faced by the board in implementing this 21
section. 22
SECTION 3. A NEW SECTION OF KRS CHAPTER 244 IS CREATED TO 23
READ AS FOLLOWS: 24
(1) As used in this section and Section 5 of this Act: 25
(a) "Angel dust" means the fungus Baudoinia compniacensis, commonly 26
known as whiskey fungus; 27 UNOFFICIAL COPY 24 RS BR 1147
Page 7 of 10
XXXX 2/7/2024 10:47 AM Jacketed
(b) "Licensee" means the holder of a distiller's license or any other license 1
issued under KRS Chapters 241 to 244, that has ownership or control over a 2
premises containing one (1) or more rickhouses; 3
(c) "Premises" has the same meaning as in KRS 138.208; and 4
(d) "Rickhouse" means a structure used for the storage and aging of distilled 5
spirits barrels, if the aging of those distilled spirits is a known factor in the 6
development of angel dust. 7
(2) The department shall promulgate administrative regulations, in accordance with 8
KRS Chapter 13A, to develop and implement a program to reimburse property 9
owners on an annual basis for cleaning expenses related to accumulated angel 10
dust if the affected property is located within a three (3) mile radius of a distillery 11
or a premises with a rickhouse. 12
(3) (a) The cleaning expenses for a property shall be determined based on cleaning 13
costs incurred by the property owner. A property owner seeking 14
reimbursement shall provide clear documentation of cleaning expenses 15
attributed to angel dust. 16
(b) Verification of cleaning expenses shall be conducted by an independent 17
entity mutually agreed upon by the licensee and affected property owners. If 18
the licensee and property owners fail to agree, the department shall 19
determine the appropriate cleaning expenses. 20
(4) (a) The annual reimbursement process shall commence within thirty (30) days 21
of a property owner submitting the required documentation for that year. 22
(b) A licensee that fails to fully and timely comply with the reimbursement 23
requirements outlined in this section for a property shall be subject to a fine 24
equal to twenty-five percent (25%) of the verified cleaning costs for that 25
property, in addition to the reimbursement due, and shall also be subject to 26
any other penalties authorized under KRS Chapters 241 to 244. The 27 UNOFFICIAL COPY 24 RS BR 1147
Page 8 of 10
XXXX 2/7/2024 10:47 AM Jacketed
department shall undertake necessary collections actions to enforce 1
reimbursement and fines. 2
(c) Fines under this subsection shall be imposed and collected by the 3
department, which shall deposit these moneys into the distilled spirits 4
environmental fund established in Section 5 of this Act. 5
(5) Reimbursement funds for each qualifying property owner shall be paid from the 6
distilled spirits environmental fund established in Section 5 of this Act. 7
(6) The department shall regulate and enforce this section and Section 5 of this Act, 8
and shall ensure fair and equitable reimbursement practices. 9
(7) (a) Any party aggrieved by a decision of the department related to this section 10
and Section 5 of this Act may request a hearing in accordance with KRS 11
Chapters 241 to 244 and KRS Chapter 13B. 12
(b) Any final order of the department related to this section and Section 5 of 13
this Act may be appealed to Franklin Circuit Court in accordance with KRS 14
Chapter 13B. 15
SECTION 4. A NEW SECTION OF KRS CHAPTER 138 IS CREATED TO 16
READ AS FOLLOWS: 17
(1) As used in this section: 18
(a) "Department" means the Department of Revenue; 19
(b) "Licensee" has the same meaning as in Section 3 of this Act; and 20
(c) "Premises" has the same meaning as in KRS 138.208. 21
(2) (a) Each licensee shall annually pay to the department an environmental fee of 22
twenty-five cents ($0.25) for each barrel of distilled spirits stored in a 23
premises on January 1. 24
(b) The fee shall be paid: 25
1. Into the State Treasury and transferred to the distilled spirits 26
environmental fund established in Section 5 of this Act; 27 UNOFFICIAL COPY 24 RS BR 1147
Page 9 of 10
XXXX 2/7/2024 10:47 AM Jacketed
2. On the twentieth day of October of each year; and 1
3. Either by use of a form prescribed by the department or an electronic 2
fund transfer. 3
(c) The number of barrels of distilled spirits shall be the same number reported 4
for property tax purposes under KRS 132.160. 5
(3) All provisions of KRS Chapter 131 shall apply to the environmental fee, including 6
but not limited to provisions regarding: 7
(a) Extensions of time for filing reports and returns; 8
(b) Uniform civil penalties imposed under KRS 131.180; 9
(c) The tax interest rate; 10
(d) The period for which records are to be preserved; and 11
(e) Procedures for protest of an assessment by the department. 12
(4) The environmental fee shall be deposited into the distilled spirits environmental 13
fund established in Section 5 of this Act. 14
SECTION 5. A NEW SECTION OF KRS CHAPTER 244 IS CREATED TO 15
READ AS FOLLOWS: 16
(1) There is hereby established in the State Treasury a trust and agency account to be 17
known as the distilled spirits environmental fund. The fund shall consist of 18
moneys received from the environmental fee imposed by Section 4 of this Act, 19
fines imposed under Section 3 of this Act, state appropriations, gifts, grants, and 20
federal funds. 21
(2) The fund shall be administered by the department. 22
(3) Amounts deposited in the fund shall be used to reimburse qualifying property 23
owners for cleaning costs incurred to remove angel dust caused by aging distilled 24
spirits and for no other purpose. 25
(4) Notwithstanding KRS 45.229, fund amounts not expended at the close of a fiscal 26
year shall not lapse but shall be carried forward into the next fiscal year. 27 UNOFFICIAL COPY 24 RS BR 1147
Page 10 of 10
XXXX 2/7/2024 10:47 AM Jacketed
(5) Any interest earnings of the fund shall become a part of the fund and shall not 1
lapse. 2
(6) Moneys deposited in the fund are hereby appropriated for the purposes set forth 3
in this section and shall not be appropriated or transferred by the General 4
Assembly for any other purposes. 5
Section 6. Section 3, 4, and 5 of this Act take effect January 1, 2025. 6