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AN ACT relating to aerospace infrastructure, making an appropriation therefor, and 1
declaring an emergency. 2
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 3
SECTION 1. A NEW SECTION OF KRS CHAPTER 164 IS CREATED TO 4
READ AS FOLLOWS: 5
As used in Sections 1 to 6 of this Act: 6
(1) "Advisory committee" means the Kentucky Aerospace, Aviation, and Defense 7
Investment Fund Advisory Committee established in Section 2 of this Act; 8
(2) "Aviation" means the operation, maintenance, or manufacturing of aircraft or 9
other aerospace equipment, aerospace initiatives and efforts, and defense-related 10
products related to aerospace and aviation; 11
(3) "Aviation industry partner" means a grantor to the fund that the council 12
determines customarily employs individuals with an eligible aviation credential in 13
a relevant aviation role in the usual course of the grantor's business; 14
(4) "Aviation program": 15
(a) Means an education or training program located in Kentucky that issues 16
eligible aviation credentials or is a specific requirement to earning an 17
eligible aviation credential, including but not limited to a public high school 18
vocational program; and 19
(b) Notwithstanding paragraph (a) of this subsection, does not include a flight 20
training program unless that program is a certified pilot school regulated by 21
the Federal Aviation Administration in accordance with 14 C.F.R. pt. 141 22
or is a public high school vocational program; 23
(5) "Council" means the Council on Postsecondary Education; 24
(6) "Dedicated moneys" means a gift, grant, or donation to the fund that is subject to 25
restrictions imposed by a private grantor under Section 3 of this Act; 26
(7) "Eligible aviation credential" means: 27 UNOFFICIAL COPY 24 RS SB 127/GA
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(a) Any license or certification issued by the Federal Aviation Administration; 1
(b) A Bachelor of Science in aviation issued by a postsecondary education 2
institution overseen or licensed by the council and located in Kentucky; 3
(c) Any engineering degree issued by a postsecondary education institution 4
licensed by the council and located in Kentucky; or 5
(d) A career and technical education license or certification determined by the 6
council, in collaboration with the advisory committee, to be in high demand 7
and relevant to the aerospace industry; 8
(8) "Fund" means the Kentucky aerospace, aviation, and defense investment fund 9
established in Section 2 of this Act; 10
(9) "Grantor" means an individual or an entity that gifts, grants, or donates moneys 11
to the fund; 12
(10) "Immediate family" means an individual's parents, siblings, spouse, and 13
children; 14
(11) "Kentucky resident" means a Kentucky resident as defined by the council 15
pursuant to KRS 164.020(8); and 16
(12) "Public aviation program" is an aviation program that is a public high school 17
vocational program or institution that is a member of Kentucky's public 18
postsecondary education system. 19
SECTION 2. A NEW SECTION OF KRS CHAPTER 164 IS CREATED TO 20
READ AS FOLLOWS: 21
(1) It is the intent of the General Assembly to incentivize collaboration between 22
aviation programs, aviation industry partners, and the Commonwealth to grow 23
and strengthen the education and training pipeline of aviation professionals 24
within Kentucky by: 25
(a) Improving the ability of a broad variety of Kentucky's aviation programs to 26
meet the workforce demands and capacity of the Commonwealth; 27 UNOFFICIAL COPY 24 RS SB 127/GA
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(b) Raising awareness of and interest in a broad variety of aviation 1
occupations; 2
(c) Reducing the barriers of access to the aviation programs necessary to 3
pursue these occupations, including financial barriers; 4
(d) Improving pathways between high school career and technical programs 5
and aviation programs; and 6
(e) Developing strategies for aviation industry partners to support career 7
growth and development for their employees. 8
(2) (a) The Kentucky Aerospace, Aviation, and Defense Investment Fund Advisory 9
Committee is hereby created to be administered by the council. The advisory 10
committee shall be responsible for advising the council on the 11
implementation of Sections 1 to 6 of this Act. 12
(b) The advisory committee shall be composed of the following eleven (11) 13
members: 14
1. The president of the council, who shall serve as chair of the advisory 15
committee; 16
2. The commissioner of the Department of Aviation in the 17
Transportation Cabinet; 18
3. Nine (9) members appointed by the chair of the council, of whom: 19
a. One (1) member shall be selected from a list of three (3) 20
candidates nominated by the Kentucky Association of 21
Manufacturers who possess professional experience and 22
expertise with aviation manufacturing; 23
b. One (1) member shall have professional experience and 24
expertise as an aviation engineer; 25
c. One (1) member shall have professional experience and 26
expertise with Department of Defense contracts related to 27 UNOFFICIAL COPY 24 RS SB 127/GA
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aerospace or aviation; 1
d One (1) member shall have professional experience and 2
expertise with airport management or Federal Aviation 3
Administration airport compliance and classifications; 4
e. One (1) member shall be a member from the Kentucky Aviation 5
Association; 6
f. One (1) member shall be a licensed air transport pilot; 7
g. One (1) member that is a licensed airframe and powerplant 8
mechanic; and 9
h. Two (2) members shall be employees of a public aviation 10
program. 11
(c) Members appointed under paragraph (b)3. of this subsection shall serve for 12
terms of two (2) years, and any vacancy on the advisory committee shall be 13
filled for the remainder of the unexpired term in the same manner as the 14
original appointment. An appointed member shall continue to serve until 15
reappointed or replaced. 16
(d) The majority of the voting members shall constitute a quorum, and all 17
meetings shall be conducted in accordance with the Open Meetings Act, 18
KRS 61.805 to 61.850. 19
(e) A member of the advisory committee shall not receive compensation or 20
benefits for the member's service, but a member appointed under paragraph 21
(b)(3) of this subsection shall receive per diem and travel expenses 22
consistent with the reimbursement policy for state employees. 23
(3) There is hereby created a trust and agency account called the Kentucky 24
aerospace, aviation, and defense investment fund to be administered by the 25
Council for Postsecondary Education for the purpose of funding: 26
(a) Public and private partnerships to provide aviation training scholarships in 27 UNOFFICIAL COPY 24 RS SB 127/GA
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accordance with Section 3 of this Act to reduce the financial barriers of 1
Kentucky residents seeking eligible aviation credentials; 2
(b) Public and private partnerships to provide aviation and aerospace 3
equipment grants in accordance with Section 4 of this Act to enhance 4
Kentucky's aviation programs' ability to meet the workforce demands and 5
capacity of the Commonwealth; and 6
(c) The council's administrative, research, consulting, fundraising, planning, 7
and analysis costs of administering Sections 1 to 6 of this Act. 8
(4) (a) It is the intent of the General Assembly to encourage private financial and 9
philanthropic support of the Kentucky aerospace, aviation, and defense 10
investment fund, as the aerospace, aviation, and defense industries directly 11
benefit from a well-trained workforce capable of meeting their employment 12
needs and the needs of the Commonwealth. To the extent allowed by 13
applicable laws, the fund may directly accept gifts, grants, or donations 14
subject to restrictions imposed by a grantor. 15
(b) 1. The Kentucky aerospace, aviation, and defense investment fund shall 16
consist of two accounts. 17
2. There shall be an appropriation account containing all moneys 18
appropriated by the General Assembly and any federal funds received 19
for this purpose. 20
3. There shall be a grantor account containing all moneys received in the 21
form of gifts, grants, or donations subject to restrictions imposed by a 22
grantor, or any other moneys made available for the purposes of the 23
fund. 24
(c) Notwithstanding KRS 45.229, any moneys appropriated to the fund by the 25
General Assembly that remains in the fund at the end of any fiscal year 26
prior to the 2029-2030 fiscal year shall not lapse. 27 UNOFFICIAL COPY 24 RS SB 127/GA
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(d) Any moneys remaining in the appropriation account at the end of fiscal 1
year 2029-2030 shall be forfeited and shall lapse to the general fund. 2
(e) Any moneys remaining in the grantor fund at the end of the 2029-2030 3
fiscal year shall be returned to each grantor proportionally based on the 4
amount donated by the grantor in relation to the total amount donated by all 5
grantors. 6
(5) Subject to available funds, the fund shall consist of any: 7
(a) Appropriations designated for the fund; 8
(b) Funds, grants, and receipts from the council's fundraising activities on 9
behalf of the fund; 10
(c) Federal funds; and 11
(d) Other moneys made available for the purposes of the fund. 12
(6) Any interest earnings of the fund shall become a part of the fund and shall lapse 13
only as provided in subsection (4) of this section. Moneys in the fund are hereby 14
appropriated for the purposes set forth in this section. 15
(7) The portion of the fund expended towards the council's costs of administering 16
Sections 1 to 6 of this Act shall not exceed four percent (4%) of all gross moneys 17
in the fund or one million five hundred thousand dollars ($1,500,000) annually, 18
whichever is less. 19
(8) (a) The council shall promulgate administrative regulations by August 1, 2024, 20
in accordance with this subsection and KRS Chapter 13A to administer 21
Sections 1 to 4 of this Act. 22
(b) At least thirty (30) days before filing an administrative regulation with the 23
regulations compiler, the council shall first submit the draft administrative 24
regulation, a detailed implementation plan, and other documents required 25
to be filed by KRS Chapter 13A to the members of the Interim Joint 26
Committee on Education and the Interim Joint Committee on 27 UNOFFICIAL COPY 24 RS SB 127/GA
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Transportation for review and comment. 1
(c) The council shall consider any comments and recommendations provided 2
by the members of the Interim Joint Committee on Education and the 3
Interim Joint Committee on Transportation before filing the administrative 4
regulation. 5
(9) A member of the advisory committee shall recuse himself or herself from any vote 6
related to any aviation program or industry partner: 7
(a) Owned by the member or an immediate family of a member; 8
(b) That employs the member or immediate family member of the member; or 9
(c) That would otherwise result in a direct benefit, financial or otherwise, to 10
that member or an immediate family member of that member. 11
SECTION 3. A NEW SECTION OF KRS CHAPTER 164 IS CREATED TO 12
READ AS FOLLOWS: 13
(1) The council shall reserve at least sixty-five percent (65%) of all net moneys in the 14
fund for partnership proposals between aviation programs and aviation industry 15
partners to provide aviation training scholarships to Kentucky residents enrolled 16
in aviation programs. 17
(2) In accepting partnerships, the council shall collaborate with the advisory 18
committee to evaluate each partnership proposal to determine if the proposal 19
meets the requirements of this section and administrative regulations 20
promulgated by the council. The administrative regulations shall create a process 21
to prioritize accepting partnerships to proposals targeted to reduce the workforce 22
demand of a specific eligible aviation credential that is determined by the council, 23
in collaboration with the advisory committee, to be among the highest in demand 24
in the Commonwealth based on objective criteria. 25
(3) A partnership shall require a written partnership contract between an aviation 26
program, aviation industry partner, and the council. The partnership contract 27 UNOFFICIAL COPY 24 RS SB 127/GA
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shall: 1
(a) Prohibit any disbursement of moneys from the fund until the moneys 2
appropriated by the General Assembly to be distributed are matched, at least 3
dollar for dollar, with moneys deposited to the fund by the aviation industry 4
partner; 5
(b) Require the aviation program to use all moneys distributed to the aviation 6
program pursuant to the partnership contract to issue direct aviation 7
training scholarships to Kentucky students enrolled in the aviation 8
program; 9
(c) If applicable to an aviation program, require that the aviation training 10
scholarship application process encourage applicants to complete the Free 11
Application for Federal Student Aid; and 12
(d) Meet all other requirements set forth in this section and administrative 13
regulations, including but not limited to any reporting requirements to the 14
council. 15
(4) Disbursements of moneys from the fund to support aviation training scholarships 16
shall be made directly to an aviation program pursuant to the terms of the 17
partnership contract. 18
(5) An aviation program that enters a partnership contract shall solicit, accept, and 19
review aviation training scholarship applications submitted by students enrolled 20
in the aviation program. A partnership contract may require that an aviation 21
program do so in collaboration with the aviation industry partner. The aviation 22
program shall award aviation training scholarships pursuant to any scholarship 23
criteria set forth in the partnership contract, this section, and administrative 24
regulations. The decisions of the aviation program in the issuance of 25
scholarships shall be final. 26
(6) An aviation training scholarship issued by an aviation program pursuant to a 27 UNOFFICIAL COPY 24 RS SB 127/GA
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partnership contract shall be made directly to a recipient pursuant to a written 1
scholarship contract between the recipient and the aviation program. The 2
scholarship contract shall not restrict the recipient's ability to utilize the 3
scholarship for the total cost of attendance. Each recipient of a scholarship shall: 4
(a) Agree in the written contract to be employed within Kentucky's aviation 5
industry for a contract period of one (1) year for each academic year funded 6
by the scholarship, up to a maximum of two (2) total years; and 7
(b) Sign a promissory note as evidence of the scholarship and the obligation to 8
repay the scholarship amount upon failure to complete terms of the 9
contract. 10
(7) A grantor may place restrictions upon a contribution to the fund requiring 11
specific criteria for an aviation training scholarship or scholarships funded by 12
the grantor's dedicated moneys, including but not limited to criteria restricting 13
employment at the aviation industry partner for the contract period. 14
(8) The aviation training scholarship contract shall grant the aviation program, the 15
Commonwealth, or the aviation industry partner the authority to initiate 16
recoupment proceedings for the recovery of the total amount of all aviation 17
training scholarships awarded to an individual that fails to complete the terms of 18
a contract entered into in accordance with subsection (6) of this section, together 19
with reasonable attorney fees and interest at a compound rate not to exceed eight 20
percent (8%) per annum from the date of disbursement from the fund. 21
SECTION 4. A NEW SECTION OF KRS CHAPTER 164 IS CREATED TO 22
READ AS FOLLOWS: 23
(1) The council shall reserve up to thirty-five percent (35%) of all net moneys in the 24
fund for aviation equipment partnership contracts between public aviation 25
programs and aviation industry partners to provide aviation and aviation 26
equipment grants for a public high school vocational program or public 27 UNOFFICIAL COPY 24 RS SB 127/GA
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postsecondary education institution to maintain, acquire, or lease aviation or 1
aviation equipment. 2
(2) An aviation equipment partnership shall require a written partnership contract 3
between a public aviation program, aviation industry partner, and the council. 4
The partnership contract shall: 5
(a) Prohibit any disbursement of moneys from the fund until the moneys 6
appropriated by the General Assembly to be distributed are matched, at least 7
dollar for dollar, with moneys deposited to the fund by the aviation partner; 8
(b) Require a public aviation program to use all moneys of an aviation 9
equipment grant to maintain, acquire, or lease aviation or aviation 10
equipment; 11
(c) Prohibit the aviation industry partner from maintaining any ownership 12
interest in aviation or aviation equipment maintained, acquired, or leased 13
with the funds from the aviation equipment grant; 14
(d) Prohibit the aviation industry partner from receiving direct or indirect 15
compensation for the maintenance or purchase of aviation or aviation 16
equipment above the fair market value cost of the services or equipment; 17
and 18
(e) Meet all other requirements set forth in this section and administrative 19
regulation, including but not limited to any reporting requirements to the 20
council. 21
(3) (a) The council shall collaborate with the advisory committee to solicit, accept, 22
and review proposals for partnership contracts by aviation industry partners 23
and public aviation programs located in Kentucky. The council shall select 24
proposals for partnership contracts, and decisions of the council in these 25
matters shall be final. The council may prioritize partnership contracts: 26
1. Targeted towards maintaining, acquiring, or leasing equipment used 27 UNOFFICIAL COPY 24 RS SB 127/GA
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by a public aviation program for a high-demand eligible aviation 1
credential; 2
2. Based upon the financial advantages afforded to a public aviation 3
program; or 4
3. Based upon the number of students that would have access to the 5
aviation or aviation equipment maintained, acquired, or leased by a 6
public aviation program with funds from an aviation equipment grant. 7
(b) Disbursements of moneys from the fund to support aviation equipment 8
grants shall be made directly to a public aviation program pursuant to the 9
terms of the partnership contract. 10
(4) The council shall require the public aviation program to submit proof that the 11
entire amount of the aviation equipment grant is invested in the maintenance, 12
acquisition, or lease of aviation or aviation training equipment utilized by 13
students enrolled in a public aviation program. A public aviation program that 14
fails to submit the proof required by the council shall return the entire amount of 15
the grant to the fund. 16
SECTION 5. A NEW SECTION OF KRS CHAPTER 164 IS CREATED TO 17
READ AS FOLLOWS: 18
(1) By December 1 of each year, the council shall collaborate with the advisory 19
committee to submit a written report to the Legislative Research Commission for 20
referral to the Interim Joint Committee on Education, the Interim Joint 21
Committee on Transportation, and the Interim Joint Committee on 22
Appropriations and Revenue Budget Review Subcommittee on Education. The 23
report shall include: 24
(a) A detailed summary of the council's costs throughout the year; 25
(b) Legislative recommendations to help grow and strengthen the education 26
and training pipeline of aviation professions within Kentucky; 27 UNOFFICIAL COPY 24 RS SB 127/GA
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(c) A detailed overview of the Kentucky aerospace, aviation, and defense 1
investment fund, including an accounting of all moneys raised and 2
expended; 3
(d) A detailed analysis of aviation training scholarships awarded pursuant to 4
Section 3 of this Act, including but not limited to: 5
1. The criteria used to award the scholarships; 6
2. The number of scholarships awarded and the amount of each 7
scholarship; 8
3. An overview of the demographic information of scholarship recipients, 9
including the county of residence; 10
4. The names of the aviation programs with scholarship recipients and 11
the type of eligible aviation credential corresponding to each program; 12
and 13
5. To the extent available, student and program outcomes, including but 14
not limited to: 15
a. Graduation rates of the aviation program overall and of 16
scholarship recipients as compared to an established baseline 17
within any such program; 18
b. Employment and employment retention rates of the aviation 19
program overall and scholarship recipients; and 20
c. The workforce participation of program graduates practicing in 21
Kentucky under an eligible aviation credential in relation to the 22
workforce demand and capacity for that specific eligible aviation 23
credential; and 24
(e) A detailed analysis of aviation equipment partnership contracts awarded 25
pursuant to Section 4 of this Act, including but not limited to the following 26
for each aviation equipment partnership contract: 27 UNOFFICIAL COPY 24 RS SB 127/GA
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1. The amount of the aviation equipment grant; 1
2. The public aviation program that is a party to the partnership contract 2
and the eligible aviation credential corresponding to that program; 3
3. The aviation industry partner or partners that are a party to the 4
partnership contract and the amount contributed by each aviation 5
industry partner to the fund; 6
4. A detailed summary of the aviation or aviation equipment maintained, 7
acquired, or leased by the public aviation program with moneys from 8
the aviation equipment grant; 9
5. Financial documentation of all transactions utilizing moneys from the 10
aviation equipment grant; and 11
6. A detailed summary of how the aviation equipment grant will impact 12
the opportunities and outcomes for students enrolled in public aviation 13
program. 14
(2) If the report required by subsection (1) of this section is not filed by December 14 15
of each year, or a later date jointly approved by the Interim Joint Committee on 16
Education and the Interim Joint Committee on Transportation, any 17
appropriations to the fund shall be forfeited and any remaining moneys in the 18
fund appropriated by the General Assembly shall lapse to the general fund. The 19
council shall return any remaining private moneys to its grantor, prorated as 20
necessary. 21
SECTION 6. A NEW SECTION OF KRS CHAPTER 164 IS CREATED TO 22
READ AS FOLLOWS: 23
Sections 1 to 6 of this Act shall expire on and have no force or effect after June 30, 24
2030, unless extended by an act of the General Assembly. 25
Section 7. This Act may be cited as the Aerospace Education Reinvestment 26
Opportunity (A.E.R.O.) Act. 27 UNOFFICIAL COPY 24 RS SB 127/GA
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Section 8. Whereas the General Assembly recognizes the urgent need to address 1
the ability of the Kentucky aviation workforce to meet its workforce needs, an emergency 2
is declared to exist, and this Act takes effect upon its passage and approval by the 3
Governor or upon its otherwise becoming a law. 4