UNOFFICIAL COPY 25 RS BR 820
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AN ACT relating to conservation district audits. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
Section 1. KRS 65A.010 is amended to read as follows: 3
As used in this chapter: 4
(1) "County" means any county, consolidated local government, urban-county 5
government, unified local government, or charter county; 6
(2) "DLG" means the Department for Local Government established by KRS 7
147A.002; 8
(3) "Establishing entity" means the city or county, or any combination of cities and 9
counties, that established a special purpose governmental entity and that has not 10
subsequently withdrawn its affiliation with the special purpose governmental entity 11
by ordinance or other official action; 12
(4) "Federally regulated municipal utility" means a municipal utility governed by the 13
provisions of KRS 96.550 to 96.901, that maintains a wholesale power contract 14
with a federal agency that also serves as its regulatory authority; 15
(5) (a) "Fee" means any user charge, levy, assessment, fee, schedule of rates, or tax, 16
other than an ad valorem tax, imposed by a special purpose governmental 17
entity. 18
(b) "Fee" shall not include the following charges imposed by special purpose 19
governmental entities that provide utility services: 20
1. Any fuel cost adjustment that is: 21
a. Made pursuant to an agreement with a power supplier; 22
b. Amended by the power supplier based on the variable cost of fuel; 23
and 24
c. Passed through to the consumer by the utility pursuant to the 25
agreement between the utility and the power supplier; 26
2. Any power or energy cost adjustment implemented pursuant to a duly 27 UNOFFICIAL COPY 25 RS BR 820
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adopted base rate that provides for the periodic adjustment of a 1
component of the rate, including any fuel costs or transmission costs, in 2
accordance with the formula or conditions set forth in the base rate; or 3
3. Any environmental control cost adjustments or surcharges implemented 4
pursuant to a duly adopted base rate that provides for the periodic 5
adjustment of a component of the rate in accordance with a formula or 6
conditions set forth in the base rate; 7
(6) (a) "Private entity" means any entity whose sole source of public funds is from 8
payments pursuant to a contract with a city, county, or special purpose 9
governmental entity, including funds received as a grant or as a result of a 10
competitively bid procurement process. 11
(b) "Private entity" does not include any entity: 12
1. Created, wholly or in part, by a city, county, or combination of cities 13
and counties to perform one (1) or more of the types of public services 14
listed in subsection (9)(c) of this section; or 15
2. Governed by a board, council, commission, committee, authority, or 16
corporation with any member or members who are appointed by the 17
chief executive or governing body of a city, county, or combination of 18
cities and counties, or whose voting membership includes governmental 19
officials who serve in an ex officio capacity; 20
(7) "Public funds" means any funds derived from the levy of a tax, fee, assessment, or 21
charge, or the issuance of bonds by the state or a city, county, or special purpose 22
governmental entity; 23
(8) "Registry" means the online central registry and reporting portal established 24
pursuant to KRS 65A.020; and 25
(9) (a) "Special purpose governmental entity" or "entity" means any agency, 26
authority, or entity created or authorized by statute which: 27 UNOFFICIAL COPY 25 RS BR 820
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1. Exercises less than statewide jurisdiction; 1
2. Exists for the purpose of providing one (1) or a limited number of 2
services or functions; 3
3. Is governed by a board, council, commission, committee, authority, or 4
corporation with policy-making authority that is separate from the state 5
and the governing body of the city, county, or cities and counties in 6
which it operates; and 7
4. a. Has the independent authority to generate public funds; or 8
b. May receive and expend public funds, grants, awards, or 9
appropriations from the state, from any agency, or authority of the 10
state, from a city or county, or from any other special purpose 11
governmental entity. 12
(b) "Special purpose governmental entity" shall include entities meeting the 13
requirements established by paragraph (a) of this subsection, whether the 14
entity is formed as a nonprofit corporation under KRS Chapter 273, pursuant 15
to an interlocal cooperation agreement under KRS 65.210 to 65.300, or 16
pursuant to any other provision of the Kentucky Revised Statutes. 17
(c) Examples of the types of public services that may be provided by special 18
purpose governmental entities include but are not limited to the following: 19
1. Ambulance, emergency, and fire protection services; 20
2. Flood control, drainage, levee, water, and water conservation services, 21
and services provided by watershed conservancy districts[,] and soil 22
and water conservation districts[services]; 23
3. Area planning, management, community improvement, and community 24
development services; 25
4. Library services; 26
5. Public health, public mental health, and public hospital services; 27 UNOFFICIAL COPY 25 RS BR 820
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6. Riverport and airport services; 1
7. Sanitation, sewer, waste management, and solid waste services; 2
8. Industrial and economic development; 3
9. Parks and recreation services; 4
10. Construction, maintenance, or operation of roads and bridges; 5
11. Mass transit services; 6
12. Pollution control; 7
13. Construction or provision of public housing, except as set out in 8
paragraph (d)8. of this subsection; 9
14. Tourism and convention services; and 10
15. Agricultural extension services. 11
(d) "Special purpose governmental entity" shall not include: 12
1. Cities; 13
2. Counties; 14
3. School districts; 15
4. Private entities; 16
5. Chambers of commerce; 17
6. Any incorporated entity that: 18
a. Provides utility services; 19
b. Is member-owned; and 20
c. Has a governing body whose voting members are all elected by the 21
membership of the entity; 22
7. Any entity whose budget, finances, and financial information are fully 23
integrated with and included as a part of the budget, finances, and 24
financial reporting of the city, county, or cities and counties in which it 25
operates; 26
8. Federally regulated public housing authorities established pursuant to 27 UNOFFICIAL COPY 25 RS BR 820
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KRS Chapter 80 that receive no more than twenty percent (20%) of their 1
total funding for any fiscal year from nonfederal fees, not including 2
rental income; or 3
9. a. Any fire protection district or volunteer fire department district 4
operating under KRS Chapter 75 with the higher of annual receipts 5
from all sources or annual expenditures of less than one hundred 6
thousand dollars ($100,000); or 7
b. Any fire department incorporated under KRS Chapter 273. 8
Section 2. KRS 262.097 is amended to read as follows: 9
(1) The supervisors of the respective soil and water conservation districts shall submit 10
to the commission such statements, estimates, budgets, and other information at 11
such time and in such manner as the commission requires. 12
(2) The supervisors of the soil and water conservation districts shall comply with the 13
provisions of KRS 65A.010 to 65A.090, except that KRS 65A.030 shall not apply 14
to soil and water conservation districts. 15
Section 3. KRS 262.280 is amended to read as follows: 16
(1) The board shall provide for the keeping of a full and accurate record of all its 17
proceedings and of all resolutions, regulations, and orders issued or adopted by it. 18
(2) Notwithstanding KRS 65A.030[For fiscal periods ending prior to July 1, 2014], an 19
audit of the accounts of each soil and water conservation district shall take place 20
once every four (4) years unless the soil and water conservation district receives or 21
expends one million dollars ($1,000,000)[seven hundred fifty thousand dollars 22
($750,000)] or more in any year, in which case the soil and water conservation 23
district shall provide for the performance of an annual audit. The audit shall be 24
conducted in accordance with audit standards and requirements stipulated in KRS 25
65.065(5).[ For fiscal periods beginning on and after July 1, 2014, the provisions of 26
KRS 65A.030 shall apply to audits of the accounts of each district.] 27 UNOFFICIAL COPY 25 RS BR 820
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(3) Upon request of the commission, the board shall furnish the commission with 1
copies of ordinances, regulations, orders, contracts, forms, and other documents 2
adopted or employed by the board and any other information requested by the 3
commission concerning the board's activities. 4
Section 4. KRS 262.763 is amended to read as follows: 5
(1) [(a) ]Notwithstanding KRS 65A.030[For fiscal periods ending prior to July 1, 6
2014], an audit of the accounts of each watershed conservancy district shall take 7
place once every four (4) years unless the watershed conservancy district receives 8
or expends one million dollars ($1,000,000)[seven hundred fifty thousand dollars 9
($750,000)] or more in any year, in which case the watershed conservancy district 10
shall provide for the performance of an annual audit. The audit shall be conducted 11
in accordance with audit standards and requirements stipulated in KRS 65.065(5). 12
The board of directors of each watershed conservancy district shall select to make 13
the audit certified public accountants who have no personal interest in the financial 14
affairs of the board of directors or in any of its officers or employees.[ 15
(b) For fiscal periods beginning on and after July 1, 2015, the provisions of KRS 16
65A.030 shall apply to the audit of accounts of each watershed conservancy 17
district.] 18
(2) Immediately upon completion of each audit, the accountant shall prepare a report of 19
his or her findings and recommendations. This report shall be to the board of 20
directors and in such number of copies as specified by the board of directors. The 21
actual expense of any audit authorized under this section shall be borne by the 22
watershed conservancy district. 23
(3) The board of directors shall comply with the provisions of KRS 65A.010 to 24
65A.090, except that KRS 65A.030 shall not apply to watershed conservancy 25
districts. 26