CHAPTER 41 Department of the Treasury

41.010. Definitions for KRS 41.070, 41.110, 41.120, 41.130, 41.280, 41.290, or 41.300 — Definitions for chapter.

  1. As used in KRS 41.070 , 41.110 , 41.120 , 41.130 , 41.280 , 41.290 , or 41.300 , unless the context requires otherwise, the terms “appropriation,” “budget unit,” “disbursements,” “expenditures,” “expenses,” and “receipts” have the meaning given them by KRS 43.010 and 48.010 .
  2. As used in this chapter:
    1. “Administrative body” includes an authority, board, bureau, interstate compact, commission, committee, conference, council, or any other form of organization in the executive branch of state government, but does not include office, department, program cabinet, or division;
    2. “Agency” means any state administrative body, program cabinet, office, department, or division;
    3. “Assistant” means assistant treasurer;
    4. “Bank” includes any bank or savings and loan association chartered by the State of Kentucky or the United States government designated to take custody of state funds on deposit, for periods greater than overnight, with the intent to honor presentments against those deposits;
    5. “Check,” unless the context requires otherwise, means either a paper check or a paperless entry on an electronic data processing medium that substitutes for a paper check and of which a permanent record is made for purposes of debiting or crediting an account;
    6. “Collateral” means the listed securities and other obligations in KRS 41.240(4);
    7. “Form” or “report” means any written method of transporting data;
    8. “Secretary” means the secretary of the Finance and Administration Cabinet;
    9. “State depository” means any bank designated to take custody of state funds on deposit pursuant to KRS 41.220 ;
    10. “Warrant” means a printed or electronic authorization from the Finance and Administration Cabinet for the Treasurer to issue a check; and
    11. “Writing” or “written” means letters, words, or numbers, or their equivalent, set down by handwriting, typewriting, printing, photostating, photographing, magnetic impulse, mechanical or electronic recording, or other form of data compilation.

History. 1992b-2: amend. Acts 1982, ch. 382, § 1, effective July 15, 1982; ch. 450, § 55, effective July 1, 1983; 1998, ch. 118, § 1, effective July 15, 1998; 1998, ch. 120, § 1, effective July 15, 1998; 2009, ch. 78, § 26, effective June 25, 2009; 2021 ch. 155, § 1, effective June 29, 2021.

Opinions of Attorney General.

The Kentucky Center for the Arts Corporation does not have to deposit the moneys it receives in the State Treasury since it is not a budget unit of the Commonwealth, a budget unit being a department or other unit of organization for which separate appropriations are made from those for any other organization unit (this section, KRS 43.010 and 45.010 (now repealed), see KRS 48.010 ). OAG 81-129 .

Since the General Assembly in subsection (2) of this section defined “bank” and “depository” to include savings and loan associations, such institutions can be considered as state depositories so long as they satisfy the remaining criteria found in Chapter 41 of the Kentucky Revised Statutes. OAG 92-83 .

Research References and Practice Aids

Cross-References.

Acts of General Assembly, treasurer entitled to copies of, KRS 57.300 .

Books received from librarian, care and custody of, KRS 57.360 , 57.370 .

Constitutional provisions as to treasurer, Ky. Const., §§ 91, 93, 95, 96, 152, 228.

Deposits of insurers, KRS 304.8-010 et seq.

Election, term, qualifications, when to enter office, duties, fees, Ky. Const., §§ 91, 93, 95.

Library service work, treasurer trustee of federal grants for, KRS 171.160 .

Motor vehicle reparations act, KRS 304.39-010 et seq.

Oath of treasurer, Ky. Const., § 228.

Teachers’ retirement system, treasurer member, ex officio treasurer and custodian of funds of, KRS 161.250, 161.370, 161.380.

Unemployment insurance fund, treasurer ex officio treasurer of, KRS 341.500 .

Vocational education and rehabilitation, treasurer custodian of federal grants for, KRS 151B.155 .

Workers’ compensation subsequent injury fund, KRS 342.122 .

41.020. Treasurer head of department — Where to keep office.

The Department of the Treasury shall be headed by the State Treasurer. He shall reside and keep his office at the seat of government.

History. Recodified 1942 Ky. Acts ch. 208, sec. 1, effective October 1, 1942, from Ky. Stat. secs. 4618-77, 4684.

NOTES TO DECISIONS

Cited:

Dennis v. Fiscal Court of Bullitt County, 784 S.W.2d 608, 1990 Ky. App. LEXIS 23 (Ky. Ct. App. 1990).

Research References and Practice Aids

Cross-References.

Bond of treasurer, amount and conditions, KRS 62.160 , 62.180 .

Commissioned by Governor, KRS 61.020 .

Election, term, qualifications, when to take office, not to succeed himself, duties, Ky. Const., §§ 91, 93, 95.

Oath, Ky. Const., § 228.

Salary of treasurer, KRS 64.480 .

State Investment Commission, treasurer is member of, KRS 42.500 .

Vacancy, how filled, Ky. Const., § 152; KRS 63.190 .

41.025. Tuition Account Program Office. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 2000, ch. 163, § 8, effective July 14, 2000) was repealed by Act 2005, ch. 162, § 9, effective July 1, 2005.

41.030. Bond of Treasurer. [Repealed.]

Compiler’s Notes.

This section (4680, 4681) was repealed by Acts 1946, ch. 27, § 21.

41.040. Salary of Treasurer. [Repealed.]

Compiler’s Notes.

This section (4683, 4683a: amend. Acts 1946, ch. 26, § 3) was repealed by Acts 1950, ch. 123, § 29. For present law see KRS 64.480 .

41.050. Suspension of Treasurer. [Repealed]

History. 4685; repealed by 2021 ch. 155, § 24, effective June 29, 2021.

41.060. Assistant treasurer.

  1. The Treasurer shall appoint an assistant and may remove him or her at pleasure. The assistant shall take the constitutional oath. The assistant may perform any of the duties of the Treasurer, excepting the signing of checks, and shall perform the duties of clerk.
  2. If the Treasurer is incapacitated, or is absent from the seat of government, the assistant shall discharge the duties of the office during the incapacity or absence of the Treasurer.
  3. The Treasurer and his or her sureties shall be responsible on his or her bond for all the acts and omissions of the assistant.
  4. The salary of the assistant shall be fixed by the Treasurer, subject to the provisions of KRS Chapter 18A.

History. 4682, 4683: amend. Acts 1946, ch. 27, § 45; 1962, ch. 210, § 4; 1982, ch. 448, § 59, effective July 15, 1982; 2021 ch. 155, § 2, effective June 29, 2021.

NOTES TO DECISIONS

1.Salary.

When the salary of the assistant treasurer was fixed by statute, the biennial appropriation bills did not authorize the Treasurer to increase that salary. Dishman v. Coleman, 244 Ky. 239 , 50 S.W.2d 504, 1932 Ky. LEXIS 397 ( Ky. 1932 ).

2.Removal.

Where the Treasurer appoints an assistant, and the Treasurer is later adjudged not to be entitled to the office, the appointed assistant is not thereby removed from his office. Long v. Coulter, 67 S.W. 272, 23 Ky. L. Rptr. 2389 , 1902 Tex. Crim. App. LEXIS 295 (Tex. Crim. App. 1902).

Research References and Practice Aids

Cross-References.

Fire and tornado insurance fund, employment of personnel necessary to carry out law relating to, KRS 56.150 .

41.070. Moneys to be deposited in state depositories — Exceptions — Designated depositories — Records of agencies.

  1. Unless otherwise expressly provided by law, no receipts from any source of state money or money for which the state is responsible shall be held, used, or deposited in any personal or special bank account, temporarily or otherwise, by any agent or employee of any budget unit, to meet expenditures or for any other purpose.
  2. All receipts of any character of any budget unit, all revenue collected for the state, and all public money and dues to the state shall be deposited in state depositories in the most prompt and cost-efficient manner available. However in the case of state departments or agencies located outside Frankfort, and all state institutions, the Finance and Administration Cabinet may permit temporary deposits to be made to the accounts maintained by the agency, department, or institution in a state depository for a period not to exceed thirty (30) days, and may require that the money be forwarded to the State Treasury at the time and in the manner and form prescribed by the cabinet. Nothing in this section shall be construed as authorizing any representative of any agency, department, or institution to enforce or cash, even for the purpose of a deposit, any check or other instrument of value payable to the Commonwealth or any agency thereof.
  3. Each agency depositing its receipts directly with the State Treasurer shall do so in the manner approved by the State Treasurer as agent in charge of public fund deposits.
  4. The Department of Revenue may deposit receipts to the credit of the State Treasury directly with a state depository utilized by the Commonwealth for its primary banking services. The State Treasurer, with the approval of the Finance and Administration Cabinet, may authorize other agencies to deposit receipts directly with a state depository to the credit of the State Treasury if the Treasurer prescribes the manner in which the deposit is to be made, and the forms and reports to be filed with the Treasury Department. The Finance and Administration Cabinet shall prescribe the forms and reports to be filed with it when this type of deposit is made.
  5. Each department, agency, or other budget unit which receives funds to be deposited into the State Treasury shall maintain records to report adequately each amount received, from whom received, and date received. Agency records shall be easily reconcilable with the information forwarded to the State Treasurer.

History. 1922b-45, 4618-85, 4686: amend. Acts 1954, ch. 244, § 1; 1968, ch. 119, § 1; 1974, ch. 74, Art. II, § 9(1); 1982, ch. 382, § 31, effective July 15, 1982; 1994, ch. 58, § 1, effective March 10, 1994; 1998, ch. 118, § 2, effective July 15, 1998; 2005, ch. 85, § 46, effective June 20, 2005; 2021 ch. 155, § 3, effective June 29, 2021.

NOTES TO DECISIONS

1.Collection of Funds.

An attorney employed to collect money due the state does not have a lien on the funds so collected by him. Hendrick v. Posey, 104 Ky. 8 , 45 S.W. 525, 20 Ky. L. Rptr. 359 , 1898 Ky. LEXIS 125 ( Ky. 1898 ).

2.KRA Premiums.

The premiums collected by Kentucky Reinsurance Association are not state funds — they are private funds; therefore since subsection (1) of this section and 446.010(31) are applicable only to state funds the premiums collected by the KRA are not required to be deposited in the State Treasury; the method of operation is to collect premiums — in advance of liabilities — to invest these funds, so that much of the liability can be met by investment income. Thompson v. Kentucky Reinsurance Asso., 710 S.W.2d 854, 1986 Ky. LEXIS 266 ( Ky. 1986 ).

3.Deposited Funds.

Upon receiving a good faith deposit to secure a real estate purchase agreement, the Commonwealth of Kentucky Transportation Cabinet did not place the funds in escrow with a third party by using a state deposit account as provided in this section. The parties never created an escrow agreement, the Cabinet's entitlement to the deposit was not conditional, and the purchase agreement did not afford the buyer any right to a refund. Lawrence v. Commonwealth of Ky. Transp. Cabinet (In re Shelbyville Rd. Shoppes, LLC), 775 F.3d 789, 2015 FED App. 0002p, 2015 U.S. App. LEXIS 73 (6th Cir. Ky. 2015 ).

Opinions of Attorney General.

After the state depositories have been initially designated by the state treasurer and the Commissioner of Finance (now Secretary of the Finance and Administration Cabinet), the commissioner of finance (now Secretary of the Finance and Administration Cabinet) under the exception may permit temporary deposits to be made in any such bank without any additional consent or approval from the state treasurer. OAG 60-332 .

An account may remain open and used from month to month under the exception with respect to temporary deposits, so long as such deposits do not exceed the 30-day period. OAG 60-332 .

Once temporary deposits are made, they cannot be changed to another state depository without the joint determination of both the State Treasurer and the Commissioner of Finance (now Secretary of the Finance and Administration Cabinet). OAG 60-332 .

This section, relating to the paying of money to the State Treasury, does not apply to the Kentucky Trotting Commission or the Kentucky Racing Commission. OAG 71-363 .

The Kentucky State Racing Commission is not required to deposit the fees it receives as authorized by KRS 230.260 into the state treasury. OAG 72-494 .

The Department of Fish and Wildlife Resources is subject to the provisions of this section unless expressly exempted. OAG 72-701 .

Although KRS 41.290 specifically excepts from its provisions private funds made available to state universities, bond project revenues are not “private funds” but are state funds falling within the purview of this section and the corporate powers of the state universities in no way militate against the application of this section in connection with subject bond project revenues. OAG 73-173 .

The state universities are required to promptly transfer subject bond project revenues into the State Treasury as required by this section and the funds are subject to investment as required by the bond contract and KRS 45.140 (now repealed) and the deposit of such revenues in the State Treasury would in no way effect a substantial impairment of bond indenture requirements. OAG 73-173 .

The Governor’s Council on Agriculture is a state agency and all funds received by it from whatever source must be handled and accounted for as state funds and may not be separately deposited in a local bank account. OAG 75-62 .

The interest accruing on the investment of fees collected on the motor vehicle usage tax each week by the county court clerk belongs to the state since the interest is produced from the principal, which principal belongs to the state and it should, therefore, be remitted to the State Treasurer at the time the principal is turned into the Department of Revenue (now Revenue Cabinet). OAG 75-502 .

The Department of Revenue (now Revenue Cabinet) can legally engage in a lockboxing arrangement with a selected depository bank which acts as an agent of the Department (now Cabinet) in carrying out duties relative to tax collections and deposits in the State Treasury and which is bound by the confidentiality provisions of KRS 131.190 . OAG 76-510 .

Revenue going to the Kentucky retirement systems must be kept in the State Treasury, since it involves money which the state or its agency is responsible for receiving and disbursing from time to time to retirees or their beneficiaries. OAG 79-396 .

The Kentucky Bar Association is not a state agency for the purpose of being subjected to an audit by the Auditor of Public Accounts pursuant to KRS Chapter 43 and since the Bar Association is not a state budget unit, its receipts do not have to be deposited to the State Treasury and its funds are not subject to appropriation by the General Assembly. OAG 80-393 .

The foundation of a state university (a nonprofit fiduciary holding funds for the benefit of any form of state organization) is not required under this section to deposit moneys received by it in the State Treasury as foundation funds are private rather than public funds. OAG 82-521 .

Funds, other than private funds and contributions, received by an affiliated corporation are subject to the provisions of this section; however, if the state university has elected to receive, deposit, collect, retain, invest, disburse and account for all funds received or due from any source as provided by subsection (2) of KRS 164A.560, then the receipts of an affiliated corporation to that university would no longer be required to be deposited in the State Treasury. OAG 82-521 .

Proceeds of general obligation bonds and revenue bonds should be deposited directly into the State Treasury System, i.e., into properly established state depositories subject to fund accounting pursuant to this section and KRS 48.010(13)(b). OAG 83-241 .

Bond proceeds and subsequent receipts that go toward debt service, and state agency bond issues for which no request of state funds is anticipated, should be deposited in a state depository as a part of the Treasury System; bond moneys include bond proceeds (sale of bonds) and project revenues. OAG 83-241 .

Receipts collected by the Kentucky Reinsurance Association must be deposited in state depositories as provided in this section; the receipts cannot be deposited outside the treasury system of Kentucky. OAG 83-370 .

The Cabinet for Human Resources may establish a system for the collection and disbursement of child support payments through the office of CHR’s contracting officials without violating subsection (1) of this section and KRS 41.160 . OAG 93-59 .

Research References and Practice Aids

Cross-References.

Boiler safety revolving fund, KRS 236.130 .

Checks and money orders to be made payable to treasurer, KRS 45.260 .

Collectors of public funds to keep record of money paid into treasury, KRS 46.030 .

Revenue Cabinet field agents, temporary deposits by, KRS 131.205 .

Fees for licenses, permits, certificates and services of budget units, how collected, KRS 45.260 .

Fines and forfeitures to be paid into treasury, KRS 30A.190.

Penalties on taxes to be paid into treasury, how disposed of, KRS 134.400 .

Taxes to be reported to Revenue Cabinet and paid into treasury monthly, KRS 134.320 .

Tolls collected from state toll bridges to be paid into treasury, KRS 180.240 .

Unemployment insurance fund, how money paid into, KRS 341.500 .

41.080. Permits to Treasurer to receive money. [Repealed.]

Compiler’s Notes.

This section (152, 4686, 4687) was repealed by Acts 1968, ch. 119, § 21.

41.090. Pay-in vouchers. [Repealed.]

Compiler’s Notes.

This section (1992b-47) was repealed by Acts 1968, ch. 119, § 21.

41.100. Treasurer to receive and acknowledge notification of moneys from state agencies.

The Treasurer shall receive notification from state agencies of all money due or payable to the state. The Treasurer shall provide acknowledgment of the notification to the Finance and Administration Cabinet.

History. 4695: amend. Acts 1968, ch. 119, § 2; 1974, ch. 74, Art. II, § 9(1); 1998, ch. 118, § 3, effective July 15, 1998.

Opinions of Attorney General.

In the limited circumstance where federal law preempts state law that would otherwise govern, the State Treasurer may authorize, without a completed “warrant” at the time the authorization is given, the financial agent of the U.S. Treasury to debit the bank account of the Commonwealth for the amount the Commonwealth owes in federal tax deposits. OAG 94-65 .

Research References and Practice Aids

Cross-References.

Finance and Administration Cabinet to keep receipt book, KRS 45.310 .

41.110. Restrictions on withdrawals of money from Treasury.

  1. No public money shall be withdrawn from the Treasury for any purpose other than that for which its withdrawal is proposed in accordance with the Constitution and statutes of the Commonwealth of Kentucky, nor unless it has been appropriated by the General Assembly or is a part of a revolving fund, and has been allotted as provided in KRS 48.010 to 48.800 , and then only on the warrant of the Finance and Administration Cabinet.
  2. The provisions of this section do not apply to withdrawals of funds from one (1) or more state depositories for immediate redeposit in other state depositories or to funds held in trust for the security of bond holders.

History. 1992b-36; 4688: amend. Acts 1968, ch. 119, § 3; 1974, ch. 74, Art. II, § 9(1); 1982, ch. 450, § 56, effective July 1, 1983; 2021 ch. 155, § 4, effective June 29, 2021.

NOTES TO DECISIONS

1.Purpose.

The purpose of this section and Ky. Const., § 230 was to prevent the expenditure of the state’s money without the consent of the legislature. Ferguson v. Oates, 314 S.W.2d 518, 1958 Ky. LEXIS 295 ( Ky. 1958 ).

2.Applicability.

This section together with KRS 41.120 does not authorize a claim against the state but merely outlines the procedure by which a validated claim must be paid out of the treasury which procedure must be followed in paying a tax refund, provided, of course, the taxpayer has first established his right to such refund. Department of Conservation v. Co-De Coal Co., 388 S.W.2d 614, 1964 Ky. LEXIS 537 (Ky. Ct. App. 1964).

Ky. Const., § 230 and KRS 41.110 , preventing the expenditure of the State’s money without the consent of the legislature, and KRS 453.010 and CR 54.04(1), restricting judgments for costs against the Commonwealth, did not prohibit the trial court’s order requiring the Cabinet for Health and Family Services to pay for counseling for a mother whose child was placed with the Cabinet; a purpose of the Unified Juvenile Code was to strengthen and maintain the biological family unit and to offer all available resources to a family in need of them, under KRS 600.010(2)(a). Cabinet for Health & Family Servs. v. Evans, 2006 Ky. App. LEXIS 52 (Ky. Ct. App. Feb. 17, 2006, sub. op., 2006 Ky. App. Unpub. LEXIS 831 (Ky. Ct. App. Feb. 17, 2006).

Trial court erred in ordering the cabinet for health and family services to pay for opiate hair follicle drug screen testing performed on the parents of a neglected child because there was no specific statute authorizing assessment of such payment and there was no significant potential infringement of the parents’ due process rights which would serve to bring the issue within the purview of the court’s inherent powers to administer justice. Commonwealth v. G.W.F., 229 S.W.3d 596, 2007 Ky. App. LEXIS 364 (Ky. Ct. App. 2007).

3.Appropriation.

The auditor (now Finance and Administration Cabinet) cannot be compelled by mandamus to issue his warrant upon the Treasury unless the Legislature has expressly appropriated the money to discharge the liability. Hager v. Shuck, 120 Ky. 574 , 87 S.W. 300, 27 Ky. L. Rptr. 957 , 1905 Ky. LEXIS 133 ( Ky. 1905 ).

Commissioners of sinking fund had no authority to make expenditures without permission of Legislature, and could not create a debt binding on the state unless specifically authorized to so do. Rhoads v. Fields, 219 Ky. 303 , 292 S.W. 809, 1927 Ky. LEXIS 321 ( Ky. 1927 ).

Direction by the Legislature to the auditor (now Finance and Administration Cabinet) to issue a warrant and to the Treasurer to pay it out of the general fund is an appropriation within the meaning of Ky. Const., § 230, it being unnecessary to use the word “appropriate.” Shannon v. Dean, 279 Ky. 279 , 130 S.W.2d 812, 1939 Ky. LEXIS 290 ( Ky. 1939 ).

A law providing a limit of $5,000 upon the expenditures of a certain state agency was a continuing appropriation, which was repealed by the Budget Act of 1934 and by succeeding appropriation acts, all of which abolished continuing appropriations and required expenditures to be based on the biennial appropriation acts. Mattingly v. Kirtley, 285 Ky. 795 , 149 S.W.2d 521, 1941 Ky. LEXIS 468 ( Ky. 1941 ).

4.— Exhaustion.

The Treasurer could not be required by mandamus to pay a warrant for clerical services rendered by claimant to the auditor (now Finance and Administration Cabinet) after the appropriation for that purpose had been exhausted in the payment of previous warrants for similar services. Bosworth v. Shuck, 118 Ky. 458 , 81 S.W. 240, 26 Ky. L. Rptr. 324 , 1904 Ky. LEXIS 57 ( Ky. 1904 ).

Since certain money from fees and receipts of county officers belonged to those officers or the county, its payment into the State Treasury did not vest the state with title thereto or a right to its custody, and the county officers were entitled to refund from the general fund without special appropriation by the General Assembly after appropriation for making refunds had been exhausted. Ross v. Gross, 300 Ky. 337 , 188 S.W.2d 475, 1945 Ky. LEXIS 544 ( Ky. 1945 ).

5.Payment into Treasury.

The Legislature intended that the revenues of the state should be paid directly into the Treasury, and an attorney who collects money due the state has no authority to retain a part of the money so collected on the theory that he has a lien on the money for his fee. Hendrick v. Posey, 104 Ky. 8 , 45 S.W. 525, 20 Ky. L. Rptr. 359 , 1898 Ky. LEXIS 125 ( Ky. 1898 ).

6.Refusal to Honor Warrant.

To the extent the Department of Finance (now Finance and Administration Cabinet) is authorized to certify the correctness of a claim from an accounting and bookkeeping standpoint, the warrant must be honored by the Treasurer, however, the designation by the Legislature of certain specific duties and responsibilities under Ky. Const., § 93 does not extinguish the implied obligation of the office and the Treasurer may properly, acting in good faith, upon a substantial constitutional ground, raise a question for judicial determination concerning the legality of a claim upon the Treasury. Raney v. Stovall, 361 S.W.2d 518, 1962 Ky. LEXIS 246 ( Ky. 1962 ).

Opinions of Attorney General.

The appropriation by trust and agency accounts in the state budget is an appropriation as defined by KRS 45.010 (now repealed) and as mentioned in Ky. Const., § 230, and the exclusion of bond project revenues by this section was designed to accommodate KRS 45.140 (now repealed) since the trust and agency accounts do not require allotments but give the exclusion the meaning that appropriations are not necessary for bond project revenues placed in the state treasury, therefore placing it in square conflict with Ky. Const., § 230, which requires appropriations in order to get revenues out of the treasury. OAG 73-173 .

In view of this section and the restrictions of Ky. Const., § 230, the payment of costs cannot be mandatorily enforced against the state, although under KRS 453.010 the state may decide payment or nonpayment of court costs based upon factual and equitable considerations surrounding the litigation. OAG 73-430 .

Under this section and KRS 31.050, KRS 31.060, and in view of KRS 45.230 (now repealed) and Ky. Const., § 230, excess funds returned to the public defender at the end of the fiscal year may not be returned to a county as an addition to the maximum formula state grant provided. OAG 73-525 .

Where a county was delinquent in payments to the county employees’ retirement fund, which is a state fund under KRS 78.520 , and the board of trustees of the county employees’ retirement system proceeded under KRS 78.535 to collect this arrearage and the State Treasurer under the authority of KRS 44.030 paid the arrearage to the retirement system fund out of funds which had been granted to the delinquent county by the state public defender’s office pursuant to KRS 31.050 and KRS 31.160, subsequently issuing a check to the delinquent county only for the amount of the grant from the public defender’s office less the retirement fund arrearage, this action violated neither Ky. Const., § 230 or KRS 41.110 , KRS 44.030 being considered an exception to the provisions of that section. OAG 73-561 .

Although the responsibility for receiving and processing the documentation supportive of claims against the state and issuing the proper and legal warrants rests with the Executive Department for Finance and Administration (now Finance and Administration Cabinet), the State Treasurer may question any particular warrant if it is done in good faith and on good constitutional grounds. OAG 76-221 .

Revenue going to the Kentucky Retirement Systems must be kept in the State Treasury, since it involves money which the state or its agency is responsible for receiving and disbursing from time to time to retirees or their beneficiaries. OAG 79-396 .

Departments and agencies of the central state government can legally pay, out of the current operational account, the travel expenses of out-of-state persons invited to Kentucky for screening employment interviews, involving high level state management or cabinet positions, when the prospective employee will not agree to pay such expenses. OAG 80-37 .

When a local development project is referred to by name in a branch budget appropriation, the use of the project name is inseparable from a local entity’s receipt of the state funds. The appropriated funds can only be lawfully applied to a facility as named in the appropriation, and any inconsistent use of those funds by the Governor’s Office for Local Development or by any local entity receiving the funds would lack authorization from the General Assembly and would therefore be contrary to state law. OAG 2005-05 .

Research References and Practice Aids

Cross-References.

Compensation of employees of General Assembly paid on certification by clerk of each house, KRS 6.230 .

Expenditures from unemployment insurance fund not subject to laws requiring specific appropriations or other formal release by state officers of money in their custody, KRS 341.500 .

Money not to be withdrawn from treasury except in pursuance of appropriation, Ky. Const., § 230.

No money to be paid to person indebted to state, KRS 44.030 .

Refund of alcoholic beverage license tax may be made without specific appropriation, KRS 243.460 .

Kentucky Law Journal.

Oberst and Lewis, Claims Against the State of Kentucky, 42 Ky. L.J. 65 (1953).

Salamanca, The Constitutionality of an Executive Spending Plan, 92 Ky. L.J. 149 (2003).

41.120. Claims to be paid by warrants — Warrant authorizes Treasurer to pay — Manner of authorization.

  1. All claims against the state shall be paid by the Treasurer on the warrants of the Finance and Administration Cabinet.
  2. All warrants issued in accordance with the provisions of this chapter shall, when signed by the secretary of the Finance and Administration Cabinet or an assistant designated by him or her, constitute full and sufficient authority to the Treasurer for the disbursement of public money in the amount set forth.
  3. Signatures may be placed on the warrants by means of an approved mechanical device. A signed transmittal which lists warrants may be accepted in lieu of each warrant being signed. Electronic authorization, approved by the secretary of the Finance and Administration Cabinet, may be accepted in lieu of any signatures.

History. 1992b-34, 1992b-37: amend. Acts 1950, ch. 101, § 1; 1968, ch. 119, § 4; 1974, ch. 74, Art. II, § 9(1); 1998, ch. 118, § 4, effective July 15, 1998; 2021 ch. 155, § 5, effective June 29, 2021.

Opinions of Attorney General.

Although the responsibility for receiving and processing the documentation supportive of claims against the state and issuing the proper and legal warrants rests with the Executive Department for Finance and Administration (now Finance and Administration Cabinet), the State Treasurer may question any particular warrant if it is done in good faith and on good constitutional grounds. OAG 76-221 .

In the limited circumstance where federal law preempts state law that would otherwise govern, the State Treasurer may authorize, without a completed “warrant” at the time the authorization is given, the financial agent of the U.S. Treasury to debit the bank account of the Commonwealth for the amount the Commonwealth owes in federal tax deposits. OAG 94-65 .

Research References and Practice Aids

Cross-References.

Finance and Administration Cabinet to keep record of money paid out of Treasury and of warrants issued, KRS 45.310 .

41.130. Warrants — Contents — Conditions of issuance Unified and integrated system of accounts.

  1. Each warrant of the Finance and Administration Cabinet upon the Treasury shall specify the date, amount, and person to whom payable, and no money shall be disbursed by the Treasurer unless the warrant contains these specifications.
  2. No warrant shall be issued unless the money to pay it has been appropriated by law. The Finance and Administration Cabinet may require any claimant to state on the face of his claim the law under which it is payable.
  3. The Finance and Administration Cabinet shall record all warrants in the unified and integrated system of accounts.
  4. The Treasurer shall maintain electronic records in the unified and integrated system of accounts that show all checks issued, the name of the payee, date, and amount and shall be in a format that is readily reconcilable with the warrants issued by the Finance and Administration Cabinet.

History. 143, 146, 1992b-37, 4689: amend. Acts 1968, ch. 119, § 5; 1974, ch. 74, Art. II, § 9(1); 1998, ch. 118, § 5, effective July 15, 1998; 2021 ch. 155, § 6, effective June 29, 2021.

NOTES TO DECISIONS

1.Issuance of Warrant.
2.— Refusal.

The auditor (now Finance and Administration Cabinet) has the legal right to refuse to issue a warrant for the payment of any claim presented to him, the correctness of which he may question and on the advice of the Attorney General conclude to contest. Greene v. Ballard, 174 Ky. 808 , 192 S.W. 841, 1917 Ky. LEXIS 246 ( Ky. 1917 ).

To the extent the Department of Finance (now Finance and Administration Cabinet) is authorized to certify the correctness of a claim from an accounting and bookkeeping standpoint, the warrant must be honored by the Treasurer, however, the designation by the Legislature of certain specific duties and responsibilities under Ky. Const., § 93 does not extinguish the implied obligation of the office and the Treasurer may properly, acting in good faith, upon a substantial constitutional ground, raise a question for judicial determination concerning the legality of a claim upon the Treasury. Raney v. Stovall, 361 S.W.2d 518, 1962 Ky. LEXIS 246 ( Ky. 1962 ).

3.Appropriation.

The state cannot be made liable at all except under a statute passed by the legislature incurring the liability, nor can it then be liable to suit against its auditor (now Finance and Administration Cabinet) to compel him by mandamus to issue his warrant upon the Treasury unless the Legislature has expressly appropriated the money to discharge the liability. Hager v. Shuck, 120 Ky. 574 , 87 S.W. 300, 27 Ky. L. Rptr. 957 , 1905 Ky. LEXIS 133 ( Ky. 1905 ).

Direction by the Legislature to the auditor (now Finance and Administration Cabinet) to issue a warrant and to the treasurer to pay it out of the general fund is an appropriation within the meaning of Ky. Const., § 230, it being unnecessary to use the word “appropriate.” Shannon v. Dean, 279 Ky. 279 , 130 S.W.2d 812, 1939 Ky. LEXIS 290 ( Ky. 1939 ).

4.Drug Testing Costs.

Trial court erred in ordering the cabinet for health and family services to pay for opiate hair follicle drug screen testing performed on the parents of a neglected child because there was no specific statute authorizing assessment of such payment and there was no significant potential infringement of the parents’ due process rights which would serve to bring the issue within the purview of the court’s inherent powers to administer justice. Commonwealth v. G.W.F., 229 S.W.3d 596, 2007 Ky. App. LEXIS 364 (Ky. Ct. App. 2007).

Opinions of Attorney General.

In the limited circumstance where federal law preempts state law that would otherwise govern, the State Treasurer may authorize, without a completed “warrant” at the time the authorization is given, the financial agent of the U.S. Treasury to debit the bank account of the Commonwealth for the amount the Commonwealth owes in federal tax deposits. OAG 94-65 .

Research References and Practice Aids

Cross-References.

No money to be paid to person indebted to state, KRS 44.030 .

Warrants for salaries not to be issued until end of month, KRS 45.340 .

41.140. Warrants to be submitted to Treasurer. [Repealed]

History. 1992b-51: amend. Acts 1974, ch. 74, Art. II, § 9(1); 1998, ch. 118, § 6, effective July 15, 1998; repealed by 2021 ch. 155, § 24, effective June 29, 2021.

41.150. Treasurer to accept warrants — Payment — Register of checks. [Repealed]

History. 1992b-37, 4688a-1: amend. Acts 1968, ch. 119, § 6; 1974, ch. 74, Art. II, § 9(1); repealed by 2021 ch. 155, § 24, effective June 29, 2021.

41.160. Payments to be made by Treasurer.

  1. No money shall be paid out of the Treasury except by the check of the Treasurer upon a state depository, or through the provisions of KRS 45A.655 .
  2. Payments may be made direct by the Treasurer to the persons entitled to receive them, by mail or otherwise, or through the heads of the budget units which incurred the expenditures.

History. 1992b-34, 4688, 4689: amend. Acts 1968, ch. 119, § 7; 1998, ch. 118, § 7, effective July 15, 1998; 2021 ch. 155, § 7, effective June 29, 2021.

NOTES TO DECISIONS

1.Payment.
2.— Method.

Mailing of a check of the Treasurer on a designated state depository, by the auditor (now Finance and Administration Cabinet) to the proper address of the payee, is payment in compliance with this section. Gibony v. Commonwealth, 91 S.W. 732, 28 Ky. L. Rptr. 1230 , 28 Ky. L. Rptr. 1280 (1906).

3.Duplicate Check.

A check mailed to the trustee of the jury fund by the Treasurer constituted payment as to the state of the amount of such check, but where the trustee never received the check and the check had never been presented to the bank for payment the trustee could by executing a bond of indemnity to the treasurer and making proof of the loss of the check receive of them a duplicate check for the amount due him. Gibony v. Commonwealth, 91 S.W. 732, 28 Ky. L. Rptr. 1230 , 28 Ky. L. Rptr. 1280 (1906).

4.Refusal to Honor Warrant.

To the extent the Department of Finance (now Finance and Administration Cabinet) is authorized to certify the correctness of a claim from an accounting and bookkeeping standpoint, the warrant must be honored by the Treasurer, however, the designation by the Legislature of certain specific duties and responsibilities under Ky. Const., § 93 does not extinguish the implied obligation of the office and the treasurer may properly, acting in good faith, upon a substantial constitutional ground, raise a question for judicial determination concerning the legality of a claim upon the Treasury. Raney v. Stovall, 361 S.W.2d 518, 1962 Ky. LEXIS 246 ( Ky. 1962 ).

Opinions of Attorney General.

Where a check mailed by the State Treasurer was claimed to have been lost the payee may have a duplicate check upon execution of an indemnity bond. OAG 72-757 .

The electronic transfer of funds from the State Treasury cannot be legally done since, under the explicit language of this section, the check is presently the exclusive device for transferring money out of the State Treasury. OAG 79-206 .

An urban county government would be required to execute an indemnity bond in order to obtain a duplicate check to replace one issued by the State Treasurer which never reached the local government and was presumably lost. OAG 82-112 .

The Cabinet for Human Resources may establish a system for the collection and disbursement of child support payments through the office of CHR’s contracting officials without violating KRS 41.070(1) and this section. OAG 93-59 .

Research References and Practice Aids

Cross-References.

Check of person receiving Confederate pension to be sent to address of pensioner, KRS 206.100 .

Records of warrants and receipts, KRS 45.310 .

41.165. Wage payment by electronic transfer of funds — Request forms.

  1. Notwithstanding the provisions of KRS 337.010 through 337.070 and 41.160 , the Treasurer shall pay, by electronic fund transfer, the wages of any state employee who makes a prior written request to the employing state agency to be paid by electronic fund transfer. The Treasurer may refuse to comply with the request of an employee if the financial institution designated by the employee does not have the capability of receiving electronic transfers of funds.
  2. The Personnel Cabinet shall provide forms on which to request wage payments by electronic transfer of funds. The Personnel Cabinet may, by regulations promulgated pursuant to KRS Chapter 13A, require information on the request forms for wage payment by electronic transfer of funds that sufficiently identifies the employee and the designated financial institution of the employee.
  3. Any state agencies which employ persons who have exercised the option authorized by subsection (1) of this section shall retain the forms described in subsection (2) of this section.

History. Enact. Acts 1982, ch. 252, § 1, effective July 1, 1983; 1998, ch. 118, § 8, effective July 15, 1998; 1998, ch. 154, § 60, effective July 15, 1998.

Legislative Research Commission Note.

(7/15/98). This section was amended by 1998 Ky. Acts chs. 118 and 154 which do not appear to be in conflict and have been codified together.

(10/5/90). Pursuant to KRS 7.136(1), KRS Chapter 13A has been substituted for the prior reference to KRS Chapter 13 in this statute. The sections in KRS Chapter 13 were repealed by 1984 Ky. Acts ch. 417, § 36 and KRS Chapter 13A was created in that same chapter of the 1984 Ky. Acts.

41.167. Electronic funds transfers.

The State Treasurer may withdraw funds from or deposit funds in the State Treasury by means of electronic funds transfers. The Finance and Administration Cabinet shall obtain a payee’s prior, written consent for the payment of funds due him or her from the State Treasury by means of direct deposit rather than by means of a paper check issued to him or her. A single authorization may be granted for multiple payments to a payee by means of direct deposit.

History. Enact. Acts 1982, ch. 382, § 4, effective July 15, 1982; 1998, ch. 118, § 9, effective July 15, 1998; 2021 ch. 155, § 8, effective June 29, 2021.

41.170. Record of warrants in system of accounts — Notice of issuance of checks. [Repealed]

History. 146, 1992b-53: amend. Acts 1968, ch. 119, § 8; 1974, ch. 74, Art. II, § 9(1); 1998, ch. 118, § 10, effective July 15, 1998; repealed by 2021 ch. 155, § 24, effective June 29, 2021.

41.180. Interest-bearing warrants; how and when issued. [Repealed.]

Compiler’s Notes.

This section (4618-85, 4688a-2, 4688a-3, 4688a-6: amend. Acts 1942, ch. 114, §§ 1, 3, 4) was repealed by Acts 1968, ch. 119, § 21.

41.185. Maximum limit on interest-bearing warrants. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1942, ch. 39, § 1) was repealed by Acts 1968, ch. 119, § 21.

41.190. Calling warrants for payment. [Repealed.]

Compiler’s Notes.

This section (4688a-4: amend. Acts 1942, ch. 114, §§ 2, 4; 1966, ch. 239, § 3) was repealed by Acts 1968, ch. 119, § 21.

41.200. Warrants negotiable and tax-free.

All warrants heretofore or hereafter issued by the state, whether the date of maturity is fixed or not, are negotiable instruments. No warrant shall be subject to taxation by the state or any subdivision thereof.

History. 4688a-8.

41.210. Public money to be deposited in state depositories.

All public money of the state received into the Treasury shall be deposited, on the day it is received, in one (1) or more of the state depositories.

History. 1992b-44, 4686, 4692; 2021 ch. 155, § 9, effective June 29, 2021.

41.220. Designation of banks as state depositories — Minimum capital stock requirement — Use of banks if state depositories not designated.

  1. Not less than three (3) solvent banks shall be designated as state depositories for state funds. Each bank designated shall have not less than the minimum capital stock as required by the primary state or federal regulator of the bank. Banks shall be designated as state depositories for state funds upon agreement of the State Treasurer and the secretary of the Finance and Administration Cabinet. Those banks designated shall be entered in the executive journal. If at any time it appears that the capital of any state depository has become impaired, the state’s deposits shall be withdrawn and deposited with another state depository.
  2. The State Treasurer and the secretary of the Finance and Administration Cabinet shall determine the needs for moving state funds from one (1) designated depository to another.
  3. If no banks are designated as state depositories in accordance with this section, all banks as defined in KRS 41.010 shall be considered eligible state depositories.

History. 1992b-44, 4692: amend. Acts 1948, ch. 115; 1956 (1st Ex. Sess.), ch. 7, Art. XVI, § 18, effective July 1, 1956; 1998, ch. 196, § 27, effective July 15, 1998; 2021 ch. 155, § 10, effective June 29, 2021.

Legislative Research Commission Notes.

(7/12/2006). 2006 Ky. Acts ch. 247 instructs the Reviser of Statutes to adjust KRS references throughout the statutes to conform with the 2006 renumbering of the Financial Services Code, KRS Chapter 286. Such an adjustment has been made in this statute.

NOTES TO DECISIONS

1.Notice of Termination.

In the absence of any agreement specifically fixing the time, the designated bank will continue to be the depository of the state until terminated by notice. State Nat'l Bank v. Commonwealth, 129 Ky. 637 , 112 S.W. 678, 1908 Ky. LEXIS 202 ( Ky. 1908 ).

Opinions of Attorney General.

Once temporary deposits are made, they cannot be changed to another state depository without the joint determination of both the State Treasurer and the Commissioner of Finance (now secretary of the Finance and Administration Cabinet). OAG 60-332 .

The word “banks” as used in subsection (1) includes state banks organized under KRS Chapter 287 and any national banks whose principal offices are located in Kentucky and, relating to state depository banks, would not include savings and loan associations organized under KRS Chapter 289. OAG 73-109 .

If the secretary of finance and the State Treasurer agree in writing to the moving of the deposit account of the Kentucky retirement systems from the state’s general fund account from one bank to another, such moving of the deposit account would be legal, although it would entail some new accounting procedure on the part of the Department of Finance (now Finance and Administration Cabinet) and the state treasury. The court assumes, of course, that the Citizens Fidelity Bank is already a designated state depository. Thus the transfer of the Kentucky retirement systems account would be permissible under the joint determination and agreement of the State Treasurer and secretary of finance. OAG 79-396 .

Subsection (2) of this section and KRS 41.260 are to be read together as a whole, under the doctrine of pari materia. OAG 79-396 .

KRS 41.380 (now KRS 42.500 ), 386.010 , 386.020 and this section should be read together, i.e., in pari materia, since they concern the same subject matter. OAG 81-353 .

The State Investment Commission may, pursuant to KRS 41.380(2) (now KRS 42.500 ), invest surplus state funds in Certificates of Deposit of any state or national bank, designated in subsection (1) of this section as a state depository whose deposits are insured by the Federal Deposit Insurance Corporation and whose main office is in this state subject to the $100,000 limitation on insurance coverage. OAG 81-353 .

The word “banks,” as used in subsection (1) of this section, would include state banks organized under KRS Chapter 287 and any national banks whose principal officers are located in Kentucky. OAG 81-353 .

41.230. Charges for services by state depositories — Interest on deposits.

For services rendered by state depositories, compensation shall be made in the form of a predetermined fee or a predetermined compensating balance. State depositories shall each pay to the state, in proportion to the deposits received, interest at such rate per annum upon the average daily deposit on hand at the close of business hours as is agreed upon between the Treasurer and the state depositories, consistent with the regulations promulgated by the State Investment Commission pursuant to KRS 42.525 . The interest shall be paid to the Treasurer no later than at the end of each six (6) months or upon maturity commencing with the date of the deposit.

History. 4692: amend. Acts 1982, ch. 382, § 2, effective July 15, 1982; 2021 ch. 155, § 11, effective June 29, 2021.

Research References and Practice Aids

Cross-References.

Unemployment insurance fund, no public deposit insurance charge or premium to be paid out of, KRS 341.500 .

41.240. Pledge of collateral required of state depositories — Qualifications for a reduced pledge — Eligible securities and other obligations.

    1. Before any bank shall be named as a state depository to receive public funds, it shall either pledge or provide to the State Treasurer collateral having an aggregate current face value or current quoted market value at least equal to the deposits as of the last business day of each quarter in which funds are so deposited or provide to the State Treasurer a surety bond or surety bonds in favor of the State Treasurer in an amount at least equal to the deposits, as of the last business day of each quarter in which funds are deposited; provided, however, that amounts insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation need not be so collateralized. The president or an executive officer of each state depository shall submit to the Treasurer and the State Investment Commission a statement subscribed and sworn to by the president or executive officer showing: (1) (a) Before any bank shall be named as a state depository to receive public funds, it shall either pledge or provide to the State Treasurer collateral having an aggregate current face value or current quoted market value at least equal to the deposits as of the last business day of each quarter in which funds are so deposited or provide to the State Treasurer a surety bond or surety bonds in favor of the State Treasurer in an amount at least equal to the deposits, as of the last business day of each quarter in which funds are deposited; provided, however, that amounts insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation need not be so collateralized. The president or an executive officer of each state depository shall submit to the Treasurer and the State Investment Commission a statement subscribed and sworn to by the president or executive officer showing:
      1. The face value or current quoted market value of the securities or other obligations pledged as collateral; and
      2. The value of surety bonds provided as of the time such surety bonds are provided as collateral.

        The aggregate valuation of all pledged or provided collateral shall be reported to the State Treasurer and State Investment Commission by the state depository within ten (10) days of the close of each quarter after the date of deposit. Such value with respect to pledged collateral other than surety bonds shall be as of the end of the quarter or the preceding business day and, as to surety bonds, the market values shall be obtained from a reputable bond-pricing service. The State Treasurer and Governor may from time to time call for additional collateral to adequately secure the deposits as aggregate face or current market values may require, if the value of collateral is not compliant with state law as of the report date.

    2. No deposit of state funds shall collectively exceed at any time the state depository’s sum of capital, reserves, undivided profits and surplus or ten percent (10%) of the total deposits of the state depository, whichever is less. For purposes of this subsection only, the value of the state deposit will be determined as of the end of the last business day of each quarter that funds are deposited.
    1. As an alternative to subsection (1)(a) of this section, a state depository insured by the Federal Deposit Insurance Corporation may either pledge to the State Treasurer, as collateral, securities or other obligations having an aggregate face value or a current quoted market value or provide to the State Treasurer a surety bond or surety bonds in an amount equal to eighty percent (80%) of the value of the state deposit including demand and time accounts, if the state depository is determined by the State Investment Commission to have very strong credit with little or no credit risk at any maturity level and the likelihood of short-term unexpected problems of significance is minimal or not of a serious or long-term nature. The value of the state deposit will be determined at the end of the business day of deposit and as of the end of business on the last day of each quarter that funds are so deposited. (2) (a) As an alternative to subsection (1)(a) of this section, a state depository insured by the Federal Deposit Insurance Corporation may either pledge to the State Treasurer, as collateral, securities or other obligations having an aggregate face value or a current quoted market value or provide to the State Treasurer a surety bond or surety bonds in an amount equal to eighty percent (80%) of the value of the state deposit including demand and time accounts, if the state depository is determined by the State Investment Commission to have very strong credit with little or no credit risk at any maturity level and the likelihood of short-term unexpected problems of significance is minimal or not of a serious or long-term nature. The value of the state deposit will be determined at the end of the business day of deposit and as of the end of business on the last day of each quarter that funds are so deposited.
    2. Valuation of all pledged or provided collateral shall be reported to the State Treasurer and the State Investment Commission within ten (10) days of the close of each quarter after the date of deposit.
    3. State depositories designated as qualified for reduced pledging shall be so recorded in the executive journal.
    4. The State Investment Commission shall determine eligibility for the reduced pledging option based on totally objective and quantifiable measures of financial intermediary performance. The information for such eligibility shall be obtained from publicly available documents. The State Investment Commission shall promulgate the particular criteria of eligibility by regulations issued pursuant to KRS Chapter 13A.
  1. State depositories which do not qualify or do not choose to qualify under subsection (1) or (2) of this section shall not receive state deposits in excess of amounts that are insured by an instrumentality of the United States.
  2. Only the following securities and other obligations may be accepted by the State Treasurer as collateral under this section:
    1. Bonds, notes, letters of credit, or other obligations of or issued or guaranteed by the United States, or those for which the credit of the United States is pledged for the payment of the principal and interest thereof, and any bonds, notes, debentures, letters of credit, or any other obligations issued or guaranteed by any federal governmental agency or instrumentality, presently or in the future established by an Act of Congress, as amended or supplemented from time to time, including, without limitation, the United States government corporations listed in KRS 66.480(1)(c);
    2. Obligations of the Commonwealth of Kentucky including revenue bonds issued by its statutory authorities, commissions, or agencies;
    3. Revenue bonds issued by educational institutions of the Commonwealth of Kentucky as authorized by KRS 162.340 to 162.380;
    4. Obligations of any city of the Commonwealth of Kentucky, or any county, for the payment of principal and interest on which the full faith and credit of the issuing body is pledged;
    5. School improvement bonds issued in accordance with the authority granted under KRS 162.080 to 162.100;
    6. School building revenue bonds issued in accordance with the authority granted under KRS 162.120 to 162.300, provided that the issuance of such bonds is approved by the Kentucky Board of Education;
    7. Surety bonds issued by sureties rated in one (1) of the three (3) highest categories by a nationally recognized rating agency;
    8. Letters of credit issued by federal home loan banks; and
    9. Real property owned by the bank.

HISTORY: 4693: amend. Acts 1952, ch. 221; 1972, ch. 118, § 1; 1978, ch. 155, § 82, effective June 17, 1978; 1982, ch. 382, § 3, effective July 15, 1982; 1996, ch. 362, § 6, effective July 15, 1996; 1998, ch. 554, § 1, effective July 15, 1998; 2001, ch. 112, § 3, effective June 21, 2001; 2014, ch. 92, § 24, effective January 1, 2015; 2021 ch. 155, § 12, effective June 29, 2021.

Legislative Research Commission Note.

(10/5/90). Pursuant to KRS 7.136(1), KRS Chapter 13A has been substituted for the prior reference to KRS Chapter 13 in this statute. The sections in KRS Chapter 13 were repealed by 1984 Ky. Acts ch. 417, § 36 and KRS Chapter 13A was created in that same chapter of the 1984 Ky. Acts.

NOTES TO DECISIONS

1.Purpose.

This section is for the protection of the state, and where a bond to protect state deposits is renewed the obligors on the first bond are not relieved from liability. State Nat'l Bank v. Commonwealth, 129 Ky. 637 , 112 S.W. 678, 1908 Ky. LEXIS 202 ( Ky. 1908 ).

2.Securities Pledged.

Where by charter or statute a bank must secure a deposit of public funds, the security given by the bank must be such as it can obtain by personal indorsement, or in some other way that does not involve the pledging of assets. Commercial Banking & Trust Co. v. Citizens' Trust & Guaranty Co., 153 Ky. 566 , 156 S.W. 160, 1913 Ky. LEXIS 901 ( Ky. 1913 ).

3.Insolvency of Depository.

Commonwealth is not entitled to a right of preference in distribution of the assets of an insolvent bank because the funds were public funds. Denny v. Thompson, 236 Ky. 714 , 33 S.W.2d 670, 1930 Ky. LEXIS 819 ( Ky. 1930 ).

Opinions of Attorney General.

Applicable Kentucky administrative regulations could be amended to lawfully provide that obligations of a Federal Farm Credit Bank, the Federal National Mortgage Association and the Federal Home Loan Bank could be used as collateral as security for the depository bond mentioned in KRS 160.570, since subdivision (a) of this section permits as collateral obligations or securities issued or guaranteed by any federal governmental agency. OAG 85-3 .

Research References and Practice Aids

Cross-References.

Conditions of bond of public depository, recovery on, KRS 62.060 to 62.080 .

Federal housing act securities eligible as collateral to secure deposits of public funds, KRS 386.040 , 386.050 .

State not liable for safe custody of deposits of insurance securities, KRS 304.8-080 .

41.245. Pledge of county bonds to secure deposits. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1942, ch. 127, § 1) was repealed by Acts 1972, ch. 118, § 2.

41.250. Liability of Treasurer and state depository not affected by bond or pledge.

The execution of the bond or the pledge of the warrants or bonds required by KRS 41.240 shall not diminish the liability of the Treasurer and his or her sureties upon his or her bond, nor impair or delay the right of the state to recover on the Treasurer’s bond for any loss or misapplication of the public funds or other delinquency in office, nor impair or delay the right of the state to recover from any delinquent or defaulting bank, or the officers or stockholders thereof, in the same manner as other depositors.

History. 4693; 2021 ch. 155, § 13, effective June 29, 2021.

41.260. Transfer of deposits among state depositories.

Whenever the Treasurer decides to transfer any deposit of public money from one (1) state depository to another, the Treasurer shall notify the Finance and Administration Cabinet, describing the proposed transfer and the deposit of money to be transferred. On receipt of the notification the Finance and Administration Cabinet shall register the proposed transfer and issue its warrant for the amounts specified by the Treasurer. When the transfers have been completed the Treasurer shall immediately notify the Finance and Administration Cabinet.

History. 1992b-48: amend. Acts 1974, ch. 74, Art. II, § 9(1); 1998, ch. 118, § 11, effective July 15, 1998; 2021 ch. 155, § 14, effective June 29, 2021.

Opinions of Attorney General.

If the secretary of finance and the State Treasurer agree in writing to the moving of the deposit account of the Kentucky retirement systems from the state’s general fund account from one bank to another, such moving of the deposit account would be legal, although it would entail some new accounting procedure on the part of the Department of Finance (now Finance and Administration Cabinet) and the State Treasury. The court assumes, of course, that the Citizens Fidelity Bank is already a designated state depository. Thus the transfer of the Kentucky retirement systems account would be permissible under the joint determination and agreement of the State Treasurer and secretary of finance. OAG 79-396 .

KRS 41.220(2) and this section are to be read together as a whole, under the doctrine of pari materia. OAG 79-396 .

41.270. Monthly statements from depositories. [Repealed.]

Compiler’s Notes.

This section (159, 1992b-52, 4691: amend. Acts 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1998, ch. 118, § 20, effective July 15, 1998.

41.280. Unified and integrated system of accounts — Annual report by Treasurer.

  1. The Commonwealth of Kentucky shall maintain a unified and integrated system of accounts. As a part of any unified and integrated system of accounts:
    1. The Treasurer shall maintain the necessary records to exhibit accurately the Treasury’s cash balance;
    2. The Finance and Administration Cabinet shall provide the Treasurer with accounting data that will accurately describe the Commonwealth’s financial condition, including access to information necessary to determine the status of each receipt and expenditure account;
    3. The Treasurer shall keep a record of each depository, showing the amount deposited and the date, and the amount checked out and the date; and
    4. The Treasurer shall provide the Finance and Administration Cabinet with information regarding accumulated receipts and the status of warrants.
  2. The Treasurer shall make a clear, distinct, and intelligible report of all money received and disbursed during each fiscal year showing the receipts and expenditures of each year on account of every department of the public service, the name of each state depository, and the rate of interest paid by it. The report shall be published annually, and the Treasurer shall submit the report to the Governor, the Chief Justice, and the Legislative Research Commission ninety (90) days after the close of the fiscal year.

History. 4697: amend. Acts 1968, ch. 119, § 9; 1974, ch. 74, Art. II, 9(1); 2021 ch. 155, § 15, effective June 29, 2021.

Research References and Practice Aids

Cross-References.

Airport development fund, KRS 183.772 .

Common school fund provided for, Ky. Const., §§ 184, 185, 186; KRS 157.010.

County sinking fund, treasurer to keep separate, for deposits under county debt act, KRS 66.370 .

Delinquent tax fund, KRS 134.400 .

Finance and Administration Cabinet to keep accounts with receipts, payments and depositories independent of those kept by treasurer, KRS 45.305 .

Federal grants for library service work, special fund for, KRS 171.160 .

Fiscal year, Ky. Const., § 169.

Forest reserves, federal grants for to be kept in separate fund, KRS 149.130 .

Highway bridge fund, KRS 180.240 .

Revolving fund accounts, KRS 45.253 .

Road fund, KRS ch. 176.

State Fair Board, improvement fund, to be kept by treasurer, KRS 247.190 .

State fire and tornado insurance fund, duties of treasurer as to, KRS 56.090 to 56.160 .

Unemployment compensation administration fund, KRS 341.240 .

Unemployment compensation contingent fund, KRS 341.295 .

Unemployment insurance fund, KRS 341.500 , 341.510 .

Public Service Commission, assessments for expenses of to be kept in separate fund, KRS 278.150 .

Workers’ compensation subsequent injury fund, KRS 342.122 .

41.290. Private funds and contributions.

Every department, institution or other agency of the state government having private funds or contributions available for its support or for the purpose of defraying the expenses of any work done under its direction shall deposit such funds or contributions with the Treasurer, and shall certify to the Finance and Administration Cabinet the sources from which the funds or contributions were received, the terms and conditions under which, and the purpose for which, they were received, the names of the trustees or administrators of the funds or contributions, and the name of the person authorized to approve expenditures from each fund or contribution. All disbursements from such funds and contributions shall be made by the Treasurer on the warrants of the Finance and Administration Cabinet, which shall issue such warrants only upon adequate vouchers approved by the person authorized to approve the expenditures. Separate accounting shall be made for each such contribution, and the receipts and disbursements thereof shall be maintained by the Finance and Administration Cabinet. This section does not apply to private funds of students in state educational institutions nor to the private funds of patients or prisoners in state charitable or correctional institutions, when such funds are deposited with an officer of such institutions for safekeeping, nor to the private funds or contributions made and available to the governing boards of the state supported institutions of higher learning.

History. 1992b-49: amend. Acts 1946, ch. 149, § 1; 1968, ch. 119, § 10; 1974, ch. 74, Art. II, § 9(1).

Opinions of Attorney General.

Although this section specifically excepts from its provisions private funds made available to state universities, bond project revenues are not “private funds” but are state funds falling within the purview of KRS 41.070 and the corporate powers of the state universities in no way militate against the application of KRS 41.070 in connection with subject bond project revenues. OAG 73-173 .

Since inmate funds are private funds deposited for safekeeping by the institution, the institution is a mere custodian of prisoner funds and may not place the funds on time deposit to earn interest. OAG 74-279 .

The Kentucky Horse Council (now Horse Park Commission) is an agency of state government and all of its funds from whatever source received, including private sources, contributions and membership fees, upon receipt become public funds of a state agency and are subject to all general constitutional and statutory provisions governing the audit, budgeting, accounting and expenditure of state funds. OAG 74-715 .

KRS Chapters 45 and 45A concern public funds of the commonwealth such that these provisions are not applicable to the private funds and contributions covered in this section. OAG 82-520 .

The foundation of a state university (a nonprofit fiduciary holding funds for the benefit of any form of state organization) is not required under KRS 41.070 to deposit moneys received by it in the State Treasury as foundation funds are private rather than public funds. OAG 82-521 .

Research References and Practice Aids

Cross-References.

Federal grants for equalization of library service to be kept in special fund, KRS 171.160 .

Federal grants for forest reserves to be kept in separate fund, KRS 149.130 .

Federal grants for promotion of aviation, how handled, KRS 183.130 .

41.295. Investment of surplus funds of agencies not supported by taxation. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1944, ch. 55, § 1) was repealed by Acts 1954, ch. 245, § 2, effective July 1, 1954.

41.300. Special deposit trust fund.

There shall be a special deposit fund consisting of all money received by the state or any department or officer thereof as guarantees for the payment of any costs, charges or damages accruing or liable to accrue to the state or for the performance of any specific act, including all money deposited as bail to secure the liberation of persons accused of public offenses, all money deposited by bidders on contracts to insure their entering into contracts awarded them, and all money deposited to indemnify persons whose property may be damaged or destroyed by the operations of the depositor. All such money shall be paid to the Treasurer, in the manner provided for the deposit of public money, and shall be deposited by the Treasurer as a trust fund in a separate account in a designated state depository. The money so deposited may be returned to the depositor, if he becomes entitled to its return, without specific appropriation, allotment or authorization for expenditure therefor, in the same manner as other claims against the state may be paid, or may, upon default of any depositor and upon certificate to such effect by the administrative officer having charge of the matter, be declared by the Finance and Administration Cabinet to be forfeited in whole or in part and thereupon be transferred to the extent so forfeited to the general fund. The interest on bank deposits of this fund shall accrue to the general fund.

History. 1992b-50: amend. Acts 1974, ch. 74, Art. II, § 9(1); 2021 ch. 155, § 16, effective June 29, 2021.

Research References and Practice Aids

Cross-References.

Deposit of money in lieu of bail, RCr 4.18 et seq.

Escheat of unclaimed deposits, KRS 393.010 et seq.

41.305. Elder and vulnerable victims trust fund.

  1. The elder and vulnerable victims trust fund is created as a separate revolving fund in the Office of the State Treasurer.
  2. The moneys in the trust fund shall be expended only as provided in this section and are hereby appropriated for those purposes.
  3. The State Treasurer shall credit to the trust fund all amounts received for this purpose, including appropriations, grants, gifts, and any amounts received under KRS 381.280 .
  4. The State Treasurer shall invest trust fund money in the same manner as surplus funds are invested. Earnings shall be credited to the trust fund.
  5. Notwithstanding KRS 45.229 , any moneys remaining in the trust fund at the close of the fiscal year shall not lapse but shall be carried forward into the succeeding fiscal year to be used for the purposes set forth in this section.
  6. Money shall be disbursed from the trust fund only for the purpose of providing funding to one (1) or more public or private nonprofit organizations, including government organizations, in the development or operation of elder or vulnerable adult abuse, neglect, or financial exploitation prevention or intervention programs. An organization shall be eligible to receive funding only if:
    1. The organization agrees to provide at least a twenty-five percent (25%) match of the total project amount requested, which may consist of monetary or in-kind contributions;
    2. The organization demonstrates a willingness and ability to provide program models and consultation to other organizations and communities regarding program development and maintenance; and
    3. The organization funds:
      1. Programs which provide advocacy, crisis counseling, financial guardianship, or other similar services to victims of elder or vulnerable adult abuse, neglect, or financial exploitation;
      2. Law enforcement, prosecution, or court-based programs that enhance case investigations, prosecutions, or victim assistance in criminal cases involving elder or vulnerable adult abuse, neglect, or financial exploitation;
      3. Programs which develop and implement public education and awareness campaigns on elder and vulnerable adult abuse, neglect, or financial exploitation by making use of electronic and print media to inform the public about the nature of these crimes and available resources such as victims’ rights, legal remedies, agency services, and prevention strategies; or
      4. Research initiatives that provide greater insight into the dynamics of elder and vulnerable adult abuse, neglect, or financial exploitation and guidance on best practices for intervention or prevention strategies.
    1. Fiscal, programmatic, and disbursement authority over trust fund money shall be provided by the Justice and Public Safety Cabinet, which shall develop a review panel system to award grants from the trust fund on an annual basis. Panel members shall be individuals with knowledge and operational experience in elder and vulnerable adult abuse, neglect, or financial exploitation and shall be drawn from the law enforcement, court, prosecution, and victim advocacy communities. (7) (a) Fiscal, programmatic, and disbursement authority over trust fund money shall be provided by the Justice and Public Safety Cabinet, which shall develop a review panel system to award grants from the trust fund on an annual basis. Panel members shall be individuals with knowledge and operational experience in elder and vulnerable adult abuse, neglect, or financial exploitation and shall be drawn from the law enforcement, court, prosecution, and victim advocacy communities.
    2. In disbursing money from the trust fund, the panel shall not disburse to any one (1) program more than twenty-five percent (25%) of the total funds available for disbursement and shall seek to distribute meaningful awards to as many programs as possible throughout the Commonwealth.
  7. The Justice and Public Safety Cabinet shall promulgate administrative regulations in accordance with KRS Chapter 13A to implement this section.

History. Enact. Acts 2011, ch. 43, § 4, effective June 8, 2011.

41.310. Treasurer to furnish information regarding receipts and expenditures to the Finance and Administration Cabinet on a monthly basis.

The Finance and Administration Cabinet shall furnish the Treasurer with information regarding the status of each receipt and expenditure account. At the end of each month, the Treasurer shall furnish the Finance and Administration Cabinet with information regarding the accumulated receipts and a listing of all warrants unpaid as of the end of the last day of each month.

History. 159, 4699: amend. Acts 1968, ch. 119, § 11; 1974, ch. 74, Art. II, § 9(1); 1998, ch. 118, § 12, effective July 15, 1998.

NOTES TO DECISIONS

1.Failure to Audit.

The negligence of the auditor in performing his statutory duty to periodically audit and examine the treasurer’s books and accounts did not relieve the sureties on the treasurer’s bond, nor estop the state from recovering for defalcations of the treasurer. Commonwealth v. Tate, 89 Ky. 587 , 13 S.W. 113, 12 Ky. L. Rptr. 1 , 1890 Ky. LEXIS 29 ( Ky. 1890 ) (decided under prior law).

Research References and Practice Aids

Cross-References.

Auditor to make annual examination of Treasurer’s office, KRS 43.050 .

Auditor to make monthly investigation of accounts of Treasurer and Finance and Administration Cabinet, KRS 43.060 .

General Assembly to provide for monthly investigation of accounts of Treasurer and Auditor, Ky. Const., § 53.

Penalty for obstructing investigation or examination by auditor, KRS 43.990 .

41.320. Governor may require statement of condition of Treasury.

The Governor may require, at any time, a full statement of the condition of the Treasury from the Finance and Administration Cabinet, Treasurer, and the state depositories. The Treasurer shall, at all times when called upon by the Governor, exhibit his or her books and accounts of the Treasury and all cash on hand or on deposit.

History. 4690, 4699: amend. Acts 1974, ch. 74, Art. II, § 9(1); 2021 ch. 155, § 17, effective June 29, 2021.

41.330. Delivery of office to successor — Certification of accounts and inventory — Certification by assistant treasurer in case of vacancy due to death or incapacitation of Treasurer.

  1. Upon the expiration of the term of office of the Treasurer, or if a vacancy occurs, the outgoing Treasurer shall certify in writing that the accounts and inventory of the Treasury, as recorded in the recordkeeping systems of the Commonwealth, are true, complete, and accurate as of the close of business on the Treasurer’s last day in office. The certification shall include accounts and tangible property held by the Treasury pursuant to KRS Chapters 393 and 393A. A copy of this certification shall be provided to the following:
    1. The Auditor of Public Accounts;
    2. The Secretary of State; and
    3. The secretary of the Finance and Administration Cabinet.
  2. The money, books, supplies, and equipment shall be delivered to the newly elected Treasurer or the person who fills the vacancy, and the newly elected Treasurer or the person who fills the vacancy shall give a receipt for them which shall be filed with the Secretary of State.
  3. In the event that a vacancy occurs due to the death or incapacitation of the Treasurer, the certification set forth in subsection (1) of this section shall be completed by the assistant in accordance with KRS 41.060 .
  4. Nothing in this section shall be construed as limiting the right of the Auditor to review the accounts and inventory of the Treasurer at other times as the Auditor may deem necessary or appropriate, or as required by KRS 43.060 .

History. 4684, 4700; 2021 ch. 155, § 18, effective June 29, 2021.

41.340. Annual report by Treasurer. [Repealed]

History. 4698: amend. Acts 1982, ch. 450, § 57, effective July 1, 1983; repealed by 2021 ch. 155, § 24, effective June 29, 2021.

41.345. Photostatic copies of Treasury records — Use as evidence.

  1. Treasury checks and records that are susceptible to photostatic reproduction may be proved as to foundation, identity, and authenticity without any preliminary testimony, by use of legible and durable copies, certified in the manner provided herein by the State Treasurer as custodian of the originals. The copies may be used in any trial, hearing, deposition, or any other judicial or administrative action or proceeding, whether civil or criminal, in lieu of the original checks or records.
  2. When a subpoena duces tecum is served upon the State Treasurer requiring the production of any checks or records at any action or proceeding, it is sufficient if the State Treasurer, as custodian of the original thereof, promptly notifies, in writing, the attorney for the party causing service of the subpoena, of the State Treasurer’s election to proceed under the provisions of this section. Upon notification, the attorney causing the service of the subpoena shall notify all other attorneys of record, or other parties if they are not represented by attorneys, of the State Treasurer’s procedure. Following notification, the State Treasurer as custodian of the checks or records specified in the subpoena shall promptly deliver, by certified mail, legible and durable copies, certified by the State Treasurer, of checks or records specified in the subpoena. The certification shall be signed before a notary public by the State Treasurer as custodian of the records.

History. Enact. Acts 1986, ch. 372, § 1, effective July 15, 1986; 1990, ch. 211, § 2, effective March 30, 1990.

41.350. Canceled checks and electronic transactions records to be kept ten years.

  1. Canceled checks and records of all electronic transactions of the State Treasurer debiting state depositories shall be preserved by the State Treasurer for a period of ten (10) years.
  2. For purposes of this subsection, preservation of records may be in an electronic format, including the records contained within the state’s unified and integrated system of accounts.

History. Enact. Acts 1946, ch. 4; 1982, ch. 252, § 2, effective January 1, 1983; 1982, ch. 382, § 5, effective July 15, 1982; 1990, ch. 211, § 1, effective March 30, 1990; 1998, ch. 118, § 13, effective July 15, 1998; 2021 ch. 155, § 19, effective June 29, 2021.

Opinions of Attorney General.

Since the checks of the State Treasurer upon state depository banks must be preserved for seven years warrants held by the State Treasurer must, by implication, be preserved for a similar period; thus prior to the elapsing of the seven-year period the State Treasurer may microfilm the warrants held in her office provided such is accomplished in accordance with the rules and regulations promulgated by the Department of Library and Archives (now Department for Libraries and Archives) and the original record, when it is microfilmed, may be destroyed subject to the rules and regulations of the subject department; however, since checks issued by the state treasurer must be presented within one year under KRS 41.370 , the microfilming of the original warrants should not take place until at least after the elapsing of one year from the date of issue of the check relating to the warrant in question plus an additional period sufficient to cover cancellation and reissue process described in KRS 41.370 . OAG 76-404 .

41.360. Disposition of unclaimed balances of payroll deductions for war bond purchases.

  1. Where any officer or employee of the state government or of any agency of the state government has authorized the State Treasurer to deduct from his compensation as such officer or employee a sum or sums for the purchase of United States Series E savings bonds, and thereafter, for any cause, has departed from such office or employment leaving unclaimed in the hands of the State Treasurer a sum arising from such deduction not equal to the amount for which such a bond may be purchased, the State Treasurer shall, within ninety (90) days after the date of the last deduction, mail to such officer or employee, at his last-known address as shown on the records of the Personnel Cabinet, a notice stating the sum held by the State Treasurer for such officer or employee, and requesting that he make claim for the same within six (6) months thereafter. A duplicate of such notice, addressed to the officer or employee, shall at the same time be delivered to the state agency of which the person was an officer or employee. If, at the expiration of six (6) months from the date of mailing the letter, the officer or employee has not made claim for the sum due him, the sum shall, as of July 1 following the expiration of such six-months’ period, be presumed abandoned.
  2. On or before September 1 of each year, the State Treasurer shall report to the Department of Revenue, in duplicate, a list of the sums presumed to be abandoned as of the preceding July 1, giving the name of the officer or employee and his last-known address. The State Treasurer shall cause the report to be posted and published as provided in KRS 393A.030 . If, by November 15 following such posting and publication, the sums involved have not been claimed, the State Treasurer shall place the sums to the credit of the general fund in the State Treasury and shall report that fact to the Department of Revenue. Thereafter such sums shall have the same status as other property turned over to the Department of Revenue, and the rights of any person to make claim for the same shall rest upon the same principles as the rights of other claimants of property presumed to be abandoned under the provisions of KRS Chapter 393.

HISTORY: Enact. Acts 1946, ch. 3; 1998, ch. 154, § 61, effective July 15, 1998; 2005, ch. 85, § 47, effective June 20, 2005; 2018 ch. 163, § 87, effective July 14, 2018.

41.370. Check to be presented within one year — Cancellation and warrant against check.

  1. Any check issued by the State Treasurer shall not be valid as an order for payment after one (1) year from its date of issue and this limitation shall appear on all checks issued. The State Treasurer is authorized to clear the records of all such unpaid checks and credit the amounts to the fund against which it was originally drawn.
  2. When any properly endorsed check issued by the State Treasurer is presented for payment more than one (1) year after its date of issue and within the period prescribed by KRS 413.120 , the State Treasurer shall, upon satisfactory proof of ownership, cancel the check and forward it to the secretary of the Finance and Administration Cabinet with the date and identifying information which credited the amount of the check to a particular fund. The secretary of the Finance and Administration Cabinet shall draw a warrant against the check. All endorsements on the surrendered check shall have the same effect as if the check were paid by the drawee. All checks paid in the manner herein set forth shall be charged against the fund against which they were originally drawn.

History. Enact. Acts 1948, ch. 187; 1972, ch. 209, § 1; 1974, ch. 74, Art. II, § 9(2); 1988, ch. 74, § 2, effective July 15, 1988; 1992, ch. 115, § 1, effective July 14, 1992; 1998, ch. 118, § 14, effective July 15, 1998; 2012, ch. 88, § 3, effective April 11, 2012.

Opinions of Attorney General.

Provisions in this section for payment of a stale check can be applied anytime, provided that there is sufficient money in the fund against which the surrendered check was originally drawn, but if there is an insufficiency in the proper fund or where the check is over five years old, the Legislature would have to pass a specific bill to authorize its payment. OAG 76-221 .

41.375. Issuance of duplicate check — Liability for loss sustained by issuance.

  1. A duplicate check shall be issued by the Treasurer upon:
    1. Receipt of a notarized affidavit, which may be transmitted to the Treasury in an electronic format, signed by the payee and stating that the original check has been lost or stolen; and
    2. A review of the records of the Treasury, including the unified and integrated system of accounts to determine that the original check has not been presented for payment.
  2. The payee receiving a duplicate check shall make good any loss the Commonwealth or the Treasurer may sustain on account of the issuance of the duplicate or the presentation and payment of the original, if the loss has been caused by actions of the payee. The Treasurer shall not be liable for any loss sustained by the issuance of the duplicate check.

History. Enact. Acts 1992, ch. 115, § 2, effective July 14, 1992; 2021 ch. 155, § 20, effective June 29, 2021.

41.380. Investment commission — Power to invest surplus funds — Disposition of interest. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1952, ch. 86; 1954, ch. 245, § 1, effective June 17, 1954; 1980, ch. 295, § 11 effective July 15, 1980; 1980, ch. 347 § 1, effective January 1, 1982) was repealed, reenacted and amended as KRS 42.500 by Acts 1982, ch. 382, § 6.

41.390. Power to borrow money and issue negotiable notes. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1954, ch. 192, effective June 17, 1954; 1988, ch. 273, § 2, effective July 15, 1988; 1996, ch. 274, § 1, effective July 15, 1996) was repealed by Acts 1997 (Ex. Session), ch. 4, § 44, effective May 30, 1997. For present law see KRS 56.860 to 56.869 .

41.400. Child victims’ trust fund — Limitation on disbursement.

  1. The child victims’ trust fund is created as a separate fund in the office of the State Treasurer. The fund shall be expended only as provided in this section.
  2. The State Treasurer shall credit to the trust fund all amounts received for this purpose and any amounts received under KRS 141.440 .
  3. The State Treasurer shall invest trust fund money in the same manner as surplus funds are invested. Earnings shall be credited to the trust fund.
  4. Until the total amount of assets in the trust fund exceeds twenty million dollars ($20,000,000), not more than one-half of the money contributed to the trust fund each year, plus the earnings credited to the trust fund during the previous fiscal year, and the money earned by the sale of child victims’ trust fund license plates pursuant to KRS Chapter 186, shall be available for disbursement upon the authorization of the state board as provided in KRS 15.935 . After such time that the State Treasurer certifies that the assets in the trust fund exceed twenty million dollars ($20,000,000), only the earnings credited to the trust fund shall be available for disbursement upon the authorization of the state board as provided in KRS 15.935 .
  5. Funds granted or funds received as gifts or donations to the child victims’ trust fund shall be available for disbursement upon appropriation by the General Assembly, and funds authorized for expenditure shall not be considered assets for purposes of subsection (4) of this section.

History. Enact. Acts 1984, ch. 382, § 13, effective July 13, 1984; 1996, ch. 366, § 9, effective July 15, 1996; 2005, ch. 133, § 9, effective June 20, 2005.

Research References and Practice Aids

Northern Kentucky Law Review.

Armstrong & Gillig, Responding to Child Sexual Abuse and Exploitation: The Kentucky Approach, 16 N. Ky. L. Rev. 17 (1988).

41.410. Commonwealth Council on Developmental Disabilities — Members — Executive director — Duties.

  1. The Commonwealth Council on Developmental Disabilities is created within the Department of the Treasury.
  2. The Commonwealth Council on Developmental Disabilities is established to comply with the requirements of the Developmental Disabilities Assistance and Bill of Rights Act of 2000 and any subsequent amendment to that act.
    1. The members of the Commonwealth Council on Developmental Disabilities shall be appointed by the Governor to serve as advocates for persons with developmental disabilities. The council shall be composed of twenty-six (26) members. (3) (a) The members of the Commonwealth Council on Developmental Disabilities shall be appointed by the Governor to serve as advocates for persons with developmental disabilities. The council shall be composed of twenty-six (26) members.
    2. Ten (10) members shall be representatives of: the principal state agencies administering funds provided under the Rehabilitation Act of 1973 as amended; the state agency that administers funds provided under the Individuals with Disabilities Education Act (IDEA); the state agency that administers funds provided under the Older Americans Act of 1965 as amended; the single state agency designated by the Governor for administration of Title XIX of the Social Security Act for persons with developmental disabilities; higher education training facilities, each university-affiliated program or satellite center in the Commonwealth; and the protection and advocacy system established under Public Law 101-496. These members shall represent the following:
      1. Office of Vocational Rehabilitation;
      2. Division of Blind Services within the Office of Vocational Rehabilitation;
      3. Department of Education;
      4. Department for Aging and Independent Living;
      5. Department for Medicaid Services;
      6. Department of Public Advocacy, Protection and Advocacy Division;
      7. University-affiliated programs;
      8. Local and nongovernmental agencies and private nonprofit groups concerned with services for persons with developmental disabilities;
      9. Department for Behavioral Health, Developmental and Intellectual Disabilities; and
      10. Department for Public Health, Division of Maternal and Child Health.
    3. At least sixty percent (60%) of the members of the council shall be composed of persons with developmental disabilities or the parents or guardians of persons, or immediate relatives or guardians of persons with mentally impairing developmental disabilities, who are not managing employees or persons with ownership or controlling interest in any other entity that receives funds or provides services under the Developmental Disabilities Assistance and Bill of Rights Act of 2000 as amended and who are not employees of a state agency that receives funds or provides services under this section. Of these members, five (5) members shall be persons with developmental disabilities, and five (5) members shall be parents or guardians of children with developmental disabilities or immediate relatives or guardians of adults with mentally impairing developmental disabilities who cannot advocate for themselves. Six (6) members shall be a combination of individuals in these two (2) groups, and at least one (1) of these members shall be an immediate relative or guardian of an institutionalized or previously institutionalized person with a developmental disability or an individual with a developmental disability who resides in an institution or who previously resided in an institution.
    4. Members not representing principal state agencies shall be appointed for a term of three (3) years. Members shall serve no more than two (2) consecutive three (3) year terms. Members shall serve until their successors are appointed or until they are removed for cause.
    5. The council shall elect its own chair, adopt bylaws, and operate in accordance with its bylaws. Members of the council who are not state employees shall be reimbursed for necessary and actual expenses. The Department of the Treasury shall provide personnel adequate to ensure that the council has the capacity to fulfill its responsibilities. The council shall be headed by an executive director. If the executive director position becomes vacant, the council shall be responsible for the recruitment and hiring of a new executive director.
  3. The Commonwealth Council on Developmental Disabilities shall:
    1. Develop and implement the state plan as required by Part B of the Developmental Disabilities Assistance and Bill of Rights Act of 2000, as amended, with a goal of development of a coordinated consumer and family centered focus and direction, including the specification of priority services required by that plan;
    2. Monitor, review, and evaluate, not less often than annually, the implementation and effectiveness of the state plan in meeting the plan’s objectives;
    3. To the maximum extent feasible, review and comment on all state plans that relate to persons with developmental disabilities;
    4. Submit to the Department of the Treasury and the Secretary of the United States Department of Health and Human Services any periodic reports on its activities as required by the United States Department of Health and Human Services and keep records and afford access as the Department of the Treasury finds necessary to verify the reports;
    5. Serve as an advocate for individuals with developmental disabilities and conduct programs, projects, and activities that promote systematic change and capacity building;
    6. Examine, not less than once every five (5) years, the provision of and need for federal and state priority areas to address, on a statewide and comprehensive basis, urgent needs for services, supports, and other assistance for individuals with developmental disabilities and their families; and
    7. Prepare, approve, and implement a budget that includes amounts paid to the state under the Developmental Disabilities Assistance and Bill of Rights Act of 2000, as amended, to fund all programs, projects, and activities under that Act.

History. Enact. Acts 1998, ch. 426, § 14, effective July 15, 1998; 2000, ch. 20, § 1, effective July 14, 2000; 2002, ch. 59, § 1, effective July 15, 2002; 2005, ch. 99, § 156, effective June 20, 2005; 2005, ch. 138, § 3, effective June 20, 2005; 2006, ch. 211, § 118, effective July 12, 2006; 2007, ch. 24, § 5, effective June 26, 2007; 2012, ch. 146, § 22, effective July 12, 2012; 2012, ch. 158, § 17, effective July 12, 2012; Repealed and reenact., 2018, ch. 95 § 1, effective July 14, 2018; 2019 ch. 125, § 1, effective June 27, 2019; 2019 ch. 146, § 4, effective June 27, 2019; 2021 ch. 26, § 3, effective June 29, 2021.

Compiler’s Notes.

KRS 41.410 was originally compiled as KRS 194A.135 .

The Rehabilitation Act of 1973, referred to in subsection (3), is compiled as 29 USCS § 701 et seq. The Individuals with Disabilities Education Act (IDEA), referred to in subsection (3), is compiled as 20 USCS § 1400 et seq. The Older Americans Act of 1965, referred to in subsection (3), is compiled as 42 USCS § 3001 et seq. Title XIX of the Social Security Act, referred to in subsection (3), is compiled as 42 USCS § 1396 et seq. The protection and advocacy system established under Public Law 101-496, referred to in subsection (3), is compiled as 42 USCS § 6042. The Developmental Disabilities Act of 1984, referred to in subsections (3)(b) and (4), is compiled as 42 USCS § 6000 et seq.

Legislative Research Commission Notes.

(6/29/2021). Under the authority of KRS 7.136(1), the Reviser of Statutes has altered the format of the text in subsection (3) of this statute during codification. The words in the text were not changed.

41.415. STABLE Kentucky accounts — Administration — Cooperative agreements.

  1. As used in this section, “STABLE Kentucky account” has the same definition as set forth in KRS 164A.260.
  2. The Department of the Treasury shall be responsible for administering and promoting STABLE Kentucky accounts.
  3. In order to ensure that the program is administered in a cost-effective manner, the Department of the Treasury may enter into any cooperative agreements, contracts, or similar instruments with:
    1. Other states which administer programs created under 26 U.S.C. sec. 529 A;
    2. Other agencies or departments of the Commonwealth; or
    3. A nonprofit organization tasked with providing services to individuals who are eligible for a STABLE Kentucky account.

HISTORY: 2019 ch. 125, § 2, effective June 27, 2018.

Kentucky Financial Empowerment Commission

41.450. Kentucky Financial Empowerment Commission — Board of directors — Membership — Terms — Vacancies — Removal — Appeal.

  1. As used in KRS 41.450 to 41.465 :
    1. “Board” means the board of directors of the commission; and
    2. “Commission” means the Kentucky Financial Empowerment Commission.
  2. The commission is created and established as an independent de jure municipal corporation and political subdivision of the Commonwealth of Kentucky to perform essential governmental and public functions for the purposes set forth in KRS 41.450 to 41.465 .
  3. The commission shall be governed by a board consisting of eleven (11) members as follows:
    1. The State Treasurer or the Treasurer’s designee;
    2. The commissioner of the Kentucky Department of Education or his or her designee;
    3. The commissioner of the Department of Financial Institutions or his or her designee;
    4. A representative from the Federal Reserve Bank of St. Louis — Louisville Branch;
    5. A representative from the Kentucky Credit Union League;
    6. A representative from the Kentucky Bankers Association; and
    7. Five (5) members appointed by the State Treasurer.
    1. Members of the board not representing state agencies shall be appointed for a term of three (3) years. (4) (a) Members of the board not representing state agencies shall be appointed for a term of three (3) years.
    2. Members of the board not representing state agencies shall serve no more than two (2) consecutive three (3) year terms.
    3. Members of the board shall serve until their successors are appointed or until they are removed for cause.
  4. For initial appointments of the five (5) members appointed by the State Treasurer to the board, two (2) members shall be appointed for a term of four (4) years each, and three (3) members shall be appointed for terms of three (3) years each.
  5. If a vacancy of one (1) of the five (5) members appointed to the board by the State Treasurer occurs, the State Treasurer shall appoint a replacement who shall hold office during the remainder of the term vacated.
    1. The State Treasurer may remove any of the five (5) members appointed by the State Treasurer in case of incompetency, neglect of duties, gross immorality, or malfeasance in office, and may upon removal declare the position vacant and appoint a person to fill the vacancy as provided in other cases of vacancy. (7) (a) The State Treasurer may remove any of the five (5) members appointed by the State Treasurer in case of incompetency, neglect of duties, gross immorality, or malfeasance in office, and may upon removal declare the position vacant and appoint a person to fill the vacancy as provided in other cases of vacancy.
      1. If a board member is removed under paragraph (a) of this subsection, he or she may appeal that action. (b) 1. If a board member is removed under paragraph (a) of this subsection, he or she may appeal that action.
      2. Upon appeal, an administrative hearing shall be conducted in accordance with KRS Chapter 13B.

HISTORY: 2019 ch. 155, § 1, effective June 27, 2019.

Legislative Research Commission Notes.

(6/27/2019). Under the authority of KRS 7.136(1), the Reviser of Statutes has rear-ranged the paragraphs in subsection (1) of this statute to place the definitions in alphabetical order. No words in the definitions were changed in the process.

41.455. Board chair and vice chair — Quorum — Meetings — Expenses — Conflict of interest — Administrative support.

    1. The State Treasurer shall serve as chair of the board of the commission. (1) (a) The State Treasurer shall serve as chair of the board of the commission.
    2. At the first board meeting following initial appointment of all board members, the board shall elect a vice-chair from its membership, and a vice chair shall be elected annually thereafter.
  1. The vice chair shall chair any meetings when directed to do so in writing by the State Treasurer.
    1. A majority of the commission board members shall constitute a quorum for the purposes of conducting its business, exercising its powers, and for all other purposes. (3) (a) A majority of the commission board members shall constitute a quorum for the purposes of conducting its business, exercising its powers, and for all other purposes.
    2. In determining whether a quorum exists, vacancies on the board shall be considered.
    1. The board shall meet at least once a quarter. (4) (a) The board shall meet at least once a quarter.
    2. The board may meet at other times:
      1. Upon call of the chair; or
      2. At the written request of a majority of board members;

        with a minimum of a seven (7) day notice.

  2. Board members shall receive no compensation for their services, but may be entitled to payment of reasonable and necessary expenses actually incurred in attending meetings, or discharging their official duties, subject to availability of funding.
  3. Any reimbursement of extraordinary travel expenses of board members, including but not limited to attending conventions and conferences, shall be reasonable and necessary and shall be approved by vote of a majority of the board during a meeting.
  4. If any board member has a direct or indirect interest in any organization, department, or agency with which the commission seeks to enter into a contract:
    1. The interest shall be disclosed and set forth in the minutes of the board; and
    2. The board member having the interest shall not participate in any action involving the organization in which he or she has the interest.
    1. The Kentucky State Treasury: (8) (a) The Kentucky State Treasury:
      1. Shall provide technical, clerical, and administrative assistance and support to the commission; and
      2. May provide state personnel, property, and resources to assist the commission in its functions as set forth in KRS 41.450 to 41.465 .
    2. As funding is available, the commission may enter into a contract with the Kentucky State Treasury as may be proper and appropriate for the provision of these services and resources.

HISTORY: 2019 ch. 155, § 2, effective June 27, 2019.

41.460. Powers and duties of commission and board — Executive director.

  1. All powers and duties conferred upon the commission in this chapter shall be exercised by the board, including but not limited to the following:
    1. To adopt bylaws and operate according to its bylaws;
    2. To enter into agreements, contracts, or other documents with any:
      1. Federal, state, or local agency; or
      2. Person, corporation, association, partnership, or other organization or entity; necessary to accomplish the purposes set forth in KRS 41.450 to 41.465 ;
      1. To develop and implement a plan toward increasing financial empowerment for all Kentuckians, specifically the following target groups: (c) 1. To develop and implement a plan toward increasing financial empowerment for all Kentuckians, specifically the following target groups:
        1. State government personnel;
        2. Kentuckians with disabilities;
        3. Kentuckians below the poverty threshold as defined by federal guidelines;
        4. K-12 students in Kentucky;
        5. Military veterans and personnel who claim residence in Kentucky; and
        6. Kentuckians who are retired or at retirement age.
      2. Any curriculum shall be developed by local schools under direction provided by the Kentucky Board of Education related to financial literacy guidelines as promulgated in administrative regulations under KRS 158.1411;
    3. To monitor, review, and evaluate, not less often than annually, the implementation and effectiveness of the commission’s objectives;
    4. To accept for inclusion in the fund appropriations, grants, revenue sharing, devises, gifts, bequests, donations, federal grants, and any other aid from any source whatsoever and to agree to, and to comply with, conditions incident thereto;
    5. To incorporate a nonprofit organization pursuant to KRS Chapter 273 which qualifies as a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code, for the purposes of receiving tax-deductible gifts, donations, and bequests; and
      1. To employ a full-time executive director, who shall hold office at the pleasure of the board, and any employees necessary to fulfill the duties of the commission. (g) 1. To employ a full-time executive director, who shall hold office at the pleasure of the board, and any employees necessary to fulfill the duties of the commission.
      2. The executive director may be terminated by a vote of seven (7) members of the board.
      3. The executive director shall:
        1. Act under the direction of the board;
        2. Hire necessary staff to assist in performing the duties of the commission;
        3. Carry out the policy and program directives of the commission;
        4. Be responsible for the day-to-day operations of the commission;
        5. Establish appropriate organizational structures and personnel policies;
        6. Prepare annual reports on the commission’s activities;
        7. Prepare budgets; and
        8. Perform all other duties as directed by the commission or assigned by law.
      4. The executive director and any employees of the commission shall not participate as members of the Kentucky Retirement Systems.
  2. Nothing in this section shall be construed to require the Kentucky Department of Education or any particular school district to utilize any resource or provider that enters into a contractual relationship with the commission.

HISTORY: 2019 ch. 155, § 3, effective June 27, 2019.

41.465. Annual financial statement audit.

    1. The commission shall annually procure a financial statement audit of all funds and accounts within its control. (1) (a) The commission shall annually procure a financial statement audit of all funds and accounts within its control.
    2. The audit shall be conducted in accordance with generally accepted government auditing standards.
    1. The commission shall not enter into any contract with a certified public accountant for an audit unless the Auditor of Public Accounts has: (2) (a) The commission shall not enter into any contract with a certified public accountant for an audit unless the Auditor of Public Accounts has:
      1. Declined in writing to perform the audit; or
      2. Failed to respond within fifteen (15) days of receipt of a written request for an audit.
    2. If the Auditor of Public Accounts performs the annual audit required in subsection (1) of this section, the Auditor of Public Accounts shall maintain a record of all expenses incurred, including time worked on the audit, and these expenses shall be charged to the commission.
    3. If the Auditor of Public Accounts does not perform the annual audit, any contract with a certified public accountant shall specify the following:
      1. The certified public accountant shall forward a copy of the audit report and management letters to the Auditor of Public Accounts and to the Legislative Research Commission; and
      2. The Auditor of Public Accounts shall have the right to review the certified public accountant’s work papers.

HISTORY: 2019 ch. 155, § 4, effective June 27, 2019.

Linked Deposit Investment Program

41.600. Definitions for KRS 41.600 to 41.625 — Eligibility requirements. [Repealed]

History. Enact. Acts 1994, ch. 276, § 1, effective July 15, 1994; 1996, ch. 208, § 4, effective July 15, 1996; 1998, ch. 172, § 1, effective July 15, 1998; 2004, ch. 41, § 1, effective July 13, 2004; repealed by 2019 ch. 125, § 5, effective June 27, 2019.

41.605. Authorized investment — Limitations — Annual report — Authority for administrative regulations. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1994, ch. 276, § 2, effective July 15, 1994) was repealed by Acts 1996, ch. 208, § 9, effective July 15, 1996. For present law see KRS 41.606 .

41.606. Linked deposit investment program — Purpose — Reports — Authority for administrative regulations. [Repealed]

History. Enact. Acts 1996, ch. 208, § 5, effective July 15, 1996; 2004, ch. 41, § 2, effective July 13, 2004; repealed by 2019 ch. 125, § 5, effective June 27, 2019.

41.610. Participation in program — Investment agreements — Required terms and conditions. [Repealed]

History. Enact. Acts 1994, ch. 276, § 3, effective July 15, 1994; 1996, ch. 208, § 6, effective July 15, 1996; 1998, ch. 172, § 2, effective July 15, 1998; 2004, ch. 41, § 3, effective July 13, 2004; repealed by 2019 ch. 125, § 5, effective June 27, 2019.

41.615. Use of moneys obtained — Refinancing of prior loans. [Repealed]

History. Enact. Acts 1994, ch. 276, § 4, effective July 15, 1994; 1996, ch. 208, § 7, effective July 15, 1996; 1998, ch. 172, § 3, effective July 15, 1998; repealed by 2019 ch. 125, § 5, effective June 27, 2019.

41.620. Application for linked deposit loan — Effect of false statement. [Repealed]

History. Enact. Acts 1994, ch. 276, § 5, effective July 15, 1994; 1996, ch. 208, § 8, effective July 15, 1996; repealed by 2019 ch. 125, § 5, effective June 27, 2019.

41.625. Monitoring — Administrative support — Authority for administrative regulations. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1994, ch. 276, § 6, effective July 1, 1994) was repealed by Acts 1996, ch. 208, § 9, effective July 15, 1996.

Penalties

41.990. Penalties.

  1. If the president or cashier of any state depository willfully violates any of the provisions of KRS 41.230 , 41.240 , 41.270 or 41.320 , he shall be fined not less than one thousand dollars ($1,000).
  2. Any officer, agent or employee of any budget unit who willfully fails or refuses to comply with, or expends any money in violation of, any of the provisions of KRS 41.070 , 41.110 to 41.160 , 41.210 , 41.220 , 41.260 , 41.270 , 41.290 or 41.300 shall be subject to indictment in the Franklin Circuit Court, and upon conviction shall be fined not less than fifty (50) nor more than five hundred dollars ($500) for each offense.

History. 1992b-63, 4694; 2021 ch. 155, § 23, effective June 29, 2021.

CHAPTER 42 Finance and Administration Cabinet

42.001. Definition of writing.

As used in this chapter, “writing” or “written” means letters, words, or numbers, or their equivalent, set down by handwriting, typewriting, printing, photostating, photographing, magnetic impulse, mechanical or electronic recording, or other form of data compilation.

History. Enact. Acts 1998, ch. 120, § 2, effective July 15, 1998.

42.005. Definitions for KRS 42.010.

As used in KRS 42.010 , unless the context requires otherwise:

  1. “Department” means a basic unit of administrative organization of the Finance and Administration Cabinet designated by statute or by statutorily authorized executive action as a “department.” A department may contain offices, divisions, or both, that report to it;
  2. “Office” means a basic unit of administrative organization of the Finance and Administration Cabinet. An office may or may not report directly to the secretary of the Finance and Administration Cabinet. An office may contain offices, divisions, or both, that report to it;
  3. “Division” means a major branch of a department or office established by statute or by statutorily authorized administrative action;
  4. “Administrative body” includes authority, board, bureau, interstate compact, commission, committee, conference, council, and any other form or organization in the executive branch of government, but does not include “office,” “department,” “program cabinet” or “division”;
  5. “Program cabinet” means a group of departments, or departments and commissions, or departments and offices, or other administrative bodies, designated by statute or statutorily authorized executive action as a “program cabinet.”

History. Enact. Acts 1982, ch. 447, § 8, effective January 1, 1984; 2005, ch. 85, § 48, effective June 20, 2005.

42.010. Definition of state agency.

As used in KRS 42.0171 , 42.0172 , and 42.425 , unless the context requires otherwise, “state agency” means any state administrative body, department or division as defined by KRS 42.005 .

History. 4618-69: amend. Acts 1962, ch. 210, § 5; 1966, ch. 255, § 48; 1980, ch. 188, § 15, effective July 15, 1980; 1982, ch. 447, § 9, effective January 1, 1984; 1984, ch. 111, § 32, effective July 13, 1984; 2005, ch. 85, § 49, effective June 20, 2005.

Opinions of Attorney General.

The provisions of this chapter are not applicable to local boards of education. OAG 61-894 .

Research References and Practice Aids

Cross-References.

Administrative organization, KRS Ch. 12.

Annual audit by Auditor, KRS 43.050 .

Vocational education and rehabilitation, KRS Ch. 163.

42.011. Finance and Administration Cabinet created — Office of secretary. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1974, ch. 74, Art. II, § 1; 1978, ch. 155, § 41, effective June 17, 1978; 1980, ch. 295, § 12, effective July 15, 1980; 1982, ch. 393, § 14, effective July 15, 1982) was repealed by Acts 1992, ch. 13, § 13, effective July 14, 1992.

42.012. Secretary as state’s chief financial officer.

The secretary of the Finance and Administration Cabinet shall be the chief financial officer of the state and the adviser of the Governor and the General Assembly in financial matters, and shall at all times protect the financial interests of the state.

History. Enact. Acts 1974, ch. 74, Art. II, § 2; 1978, ch. 155, § 42, effective June 17, 1978; 1982, ch. 393, § 15, effective July 15, 1982; 1992, ch. 13, § 4, effective July 14, 1992.

NOTES TO DECISIONS

1.Commissioner.

The Commissioner of Finance (now secretary of the Finance and Administration Cabinet) was more than an accounting officer, having discretion in passing on the propriety and justification of proposed expenditures. Reeves v. Talbott, 289 Ky. 581 , 159 S.W.2d 51, 1941 Ky. LEXIS 37 ( Ky. 1941 ) (decided under prior law).

2.— Powers.

While the Commissioner of Finance (now secretary of the Finance and Administration Cabinet) was designated the chief financial officer of the state with the duty to protect its financial interests, the only direct powers he was given with respect to claims against the state was to preaudit expenditures under KRS 42.030(1)(e) (now repealed) and to examine statements of indebtedness, and if found “correct” and there was a sufficient amount to pay the claim in the budget unit against which the claim was chargeable to issue warrants upon the state treasurer under KRS 45.220(1) (now repealed). There was no provision of the law recognizing the Commissioner of Finance (now secretary of the Finance and Administration Cabinet) as the final arbiter of the legality of a claim against the commonwealth which would bar the treasurer who was immediately in charge of the receipt and disbursement of all funds of the commonwealth from questioning the constitutional validity of a claim. Raney v. Stovall, 361 S.W.2d 518, 1962 Ky. LEXIS 246 ( Ky. 1962 ) (decided under prior law).

Research References and Practice Aids

Cross-References.

Accounts of local official, secretary may require Auditor of Public Accounts to audit, KRS 43.050 .

Bond, amount and conditions, KRS 62.160 , 62.180 .

Department of Fish and Wildlife Resources, approval of contracts, KRS 150.250 .

Development Finance Authority, secretary member of, KRS 154.20-020 .

Investment Commission, secretary member of, KRS 42.500 .

Salary of secretary, KRS 64.640 .

State Property and Buildings Commission, secretary member of, KRS 56.450 .

42.013. Deputy secretary — Organization of office. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1974, ch. 74, Art. II, § 3; 1976, ch. 299, § 6; 1978, ch. 155, § 43, effective June 17, 1978; 1982, ch. 393, § 16, effective July 15, 1982; 1984, ch. 340, § 1, effective July 13, 1984; 1992, ch. 13, § 5, effective July 14, 1992; 1998, ch. 68, § 1, effective July 15, 1998; 2000, ch. 5, § 1, effective July 14, 2000; 2002, ch. 12, § 1, effective July 15, 2002) was repealed, reenacted and amended as KRS 42.0145 by Acts 2005, Ch. 85, § 6, effective June 20, 2005.

42.014. Organization of cabinet.

  1. There is established within the cabinet the:
    1. Office of the Secretary;
    2. Commonwealth Office of Technology, and the Office of the Controller, each of which shall be headed by an executive director appointed by the secretary with the approval of the Governor; and
    3. Department of Revenue and the Department for Facilities and Support Services, each of which shall be headed by a commissioner appointed by the secretary, upon the approval of the Governor, and responsible to the secretary. Each of these departments may have at least one (1) major assistant not in the classified service.
  2. The secretary shall establish the internal organization and assignment of functions which are not established by statute, and shall divide the cabinet into the offices, bureaus, divisions, or other units the secretary deems necessary to perform the functions, powers, and duties of the cabinet, subject to the provisions of KRS Chapter 12.
  3. All appointments under this chapter to positions not in the classified service shall be made pursuant to KRS 12.050 , and such appointees shall be major assistants to the secretary and shall assist in the development of policy.

History. Enact. Acts 1974, ch. 74, Art. II, § 4; 1976, ch. 299, § 7; 1978, ch. 155, § 44, effective June 17, 1978; 1982, ch. 183, § 3, effective July 15, 1982; 1982, ch. 393, § 19, effective July 15, 1982; 1984, ch. 186, § 2, effective July 13, 1984; 1984, ch. 340, § 2, effective July 13, 1984; 1988, ch. 273, § 3, effective July 15, 1988; 1990, ch. 321, § 2, effective July 13, 1990; 1990, ch. 378, § 1, effective July 13, 1990; 1994, ch. 176, § 1, effective July 15, 1994; 1994, ch. 216, § 2, effective July 15, 1994; 1994, ch. 508, § 8, effective July 15, 1994; 1998, ch. 68, § 2, effective July 15, 1998; 1998, ch. 83, § 2, effective July 15, 1998; 2000, ch. 46, § 4, effective July 14, 2000; 2000, ch. 506, § 13, effective July 14, 2000; 2000, ch. 536, § 13, effective July 14, 2000; 2002, ch. 12, § 2, effective July 15, 2002; 2005, ch. 85, § 5, effective June 20, 2005; 2005, ch. 95, § 10, effective June 20, 2005.

Legislative Research Commission Note.

(6/20/2005). This section was amended by 2005 Ky. Acts chs. 85 and 95, which do not appear to be in conflict and have been codified together.

42.0141. Establishment of Office of Revenue Estimating and Economic Analysis. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1988, ch. 273, § 1, effective July 15, 1988) was repealed by Acts 1990, ch. 321, § 12, effective July 13, 1990.

42.0145. Office of the Secretary.

  1. The Office of the Secretary of the Finance and Administration Cabinet shall consist of the Office of Inspector General, Office of General Counsel, Office of Administrative Services, Office of Legislative and Intergovernmental Affairs, Office of Policy and Audit, and Office of Equal Employment Opportunity and Contract Compliance, each headed by an executive director who shall be appointed by the secretary with the approval of the Governor. The Office of the Secretary shall include a deputy secretary who shall be appointed by the secretary with the approval of the Governor. The deputy secretary shall be responsible to and have such authority to sign for the secretary as the secretary designates in writing.
  2. The secretary may organize the office into such additional administrative units as he deems necessary to perform the functions and fulfill the duties of the cabinet, subject to the provisions of KRS Chapter 12.
  3. All appointments under this chapter to positions not in the classified service shall be made pursuant to KRS 12.050 , and such appointees shall be major assistants to the secretary and shall assist in the development of policy.

HISTORY: Enact. Acts 1974, ch. 74, Art. II, § 3; 1976, ch. 299, § 6; 1978, ch. 155, § 43, effective June 17, 1978; 1982, ch. 393, § 16, effective July 15, 1982; 1984, ch. 340, § 1, effective July 13, 1984; 1992, ch. 13, § 5, effective July 14, 1992; 1998, ch. 68, § 1, effective July 15, 1998; 2000, ch. 5, § 1, effective July 14, 2000; 2002, ch. 12, § 1, effective July 15, 2002; repealed, reenact. and amend., Acts 2005, ch. 85, § 6, effective June 20, 2005; 2009, ch. 12, § 19, effective June 25, 2009; 2017 ch. 131, § 4, effective June 29, 2017.

Compiler’s Notes.

This section was formerly compiled as KRS 42.013 .

42.0146. Office of Equal Employment Opportunity and Contract Compliance — Oversight of certification program for disabled veteran-owned businesses — Administrative regulations.

  1. For purposes of this section:
    1. “Disabled veteran” means an individual, domiciled in Kentucky, who has served on active duty in the Armed Forces, has been separated therefrom under honorable or general conditions, and has established the present existence of a service-connected disability or is receiving compensation, disability retirements benefits, or pension because of a public statute administered by the United States Department of Veterans Affairs or Department of Defense, or was terminated from active duty by the Department of Defense because of a disability; and
    2. “Disabled veteran-owned business” means a business:
      1. Where a disabled veteran has at least fifty-one percent (51%) ownership;
      2. That is independently owned and operated;
      3. That does not exceed the applicable size standards for its industry, as determined by the United States Small Business Administration;
      4. That has been owned and operated by the disabled veteran for at least a full calendar or fiscal year; and
      5. For which the disabled veteran has filed a business tax return consisting of a full calendar or fiscal year.
  2. The Office of Equal Employment Opportunity and Contract Compliance shall oversee a program that provides certification of a disabled veteran-owned business in order to encourage growth among businesses owned by disabled veterans within the state and assist those businesses in competing for work in other states that require certification by a statewide body. This certification does not provide a preference in state procurement, nor does it create a point system or set aside for disabled veteran-owned businesses.
  3. In order to apply for certification, a disabled veteran shall provide proof of his or her disability. Proof shall be in the form of Department of Defense Form DD 214, United States Department of Veterans Affairs disability letter, or other United States Department of Veterans Affairs documentation establishing a service-connected disability.
  4. The Finance and Administration Cabinet shall promulgate any administrative regulations necessary to create and manage the disabled veteran-owned business certification program, which may include but is not limited to additional certification requirements, the application process, onsite visitation by the Office of Equal Employment Opportunity and Contract Compliance, and recertification.

HISTORY: 2016 ch. 100, § 1, effective July 15, 2016.

42.0147. Office of the Inspector General.

The Office of the Inspector General is established within the Office of the Secretary of the Finance and Administration Cabinet and shall be responsible for conducting various investigations within the executive branch in accordance with KRS 45.131 .

HISTORY: 2017 ch. 131, § 1, effective June 29, 2017; 2021 ch. 81, § 1, effective June 29, 2021.

42.0148. Office of Legislative and Intergovernmental Affairs.

  1. The Office of Legislative and Intergovernmental Affairs is established within the Finance and Administration Cabinet to provide executive direction and coordination of the cabinet’s legislative priorities.
  2. The Office of Legislative and Intergovernmental Affairs, in close communication with the secretary, shall:
    1. Proactively pursue the goals of the cabinet by working with members of the General Assembly and the staff of the Legislative Research Commission;
    2. Oversee all public information issues;
    3. Manage requests for information; and
    4. Prepare press releases, respond to press inquiries, and coordinate the publication of newsletters, reports, Web site information, and other statewide communications of the Finance and Administration Cabinet.

HISTORY: 2017 ch. 131, § 2, effective June 29, 2017.

42.015. Transfer of functions, powers and duties to department and secretary. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1974, ch. 74, Art. II, § 5) was repealed by Acts 1982, ch. 393, § 51, effective July 15, 1982.

42.016. Corporate bodies and instrumentalities attached to Office of Secretary.

The following corporate bodies and instrumentalities of the Commonwealth shall be attached to the Office of the Secretary for administrative purposes and staff services:

  1. State Property and Buildings Commission;
  2. Kentucky Turnpike Authority;
  3. State Investment Commission;
  4. Kentucky Housing Corporation;
  5. Kentucky River Authority; and
  6. Executive Branch Ethics Commission.

HISTORY: Enact. Acts 1974, ch. 74, Art. II, § 6; 1976, ch. 299, § 8; 1978, ch. 155, § 45, effective June 17, 1978; 1980, ch. 295, § 13, effective July 15, 1980; 1982, ch. 184, § 6, effective July 15, 1982; 1982, ch. 382, § 29, effective July 15, 1982; 1982, ch. 393, § 20, effective July 15, 1982; 1984, ch. 339, § 1, effective July 13, 1984; 1984, ch. 346, § 1, effective July 13, 1984; 1984, ch. 406, § 1, effective July 13, 1984; 1988, ch. 154, § 3, effective July 15, 1988; 1994, ch. 208, § 3, effective July 15, 1994; 1998, ch. 83, § 3, effective July 15, 1998; 2000, ch. 221, § 3, effective July 14, 2000; 2000, ch. 265, § 1, effective July 14, 2000; 2000, ch. 287, § 1, effective July 14, 2000; 2001, ch. 27, § 8, effective June 21, 2001; 2005, ch. 85, § 50, effective June 20, 2005; 2006, ch. 152, § 13, effective July 12, 2006; 2007, ch. 47, § 13, effective June 26, 2007; 2009, ch. 12, § 20, effective June 25, 2009; 2021 ch. 12, § 5, effective March 12, 2021.

42.017. Office of General Counsel.

  1. The Office of General Counsel established within the Office of the Secretary by KRS 42.0145 shall be responsible for the coordination and provision of legal services for the cabinet and for other functions and duties as the secretary may assign relating to the performance of the cabinet’s legal services.
  2. The Office of General Counsel shall be headed by an executive director who shall function as the general counsel. The executive director shall be appointed in accordance with KRS 12.210 and shall report to the secretary. The Attorney General, on request of the secretary, may designate attorneys in the Office of General Counsel as assistant attorneys general as provided in KRS 15.105 .
  3. The Office of General Counsel shall consist of two (2) offices, each of which shall provide legal services for its respective offices and departments, as follows:
    1. Office of Legal Services for Finance and Technology, headed by an executive director and composed of organizational entities deemed appropriate by the secretary of the Finance and Administration Cabinet; and
    2. Office of Legal Services for Revenue, headed by an executive director, including organizational entities deemed appropriate by the secretary of the Finance and Administration Cabinet.

History. Enact. Acts 1984, ch. 340, § 3, effective July 13, 1984; 2002, ch. 12, § 3, effective July 15, 2002; 2005, ch. 85, § 8, effective June 20, 2005; 2009, ch. 12, § 21, effective June 25, 2009.

42.0171. Office of Administrative Services.

  1. The Office of Administrative Services established in KRS 42.0145 shall be generally responsible for all internal administrative and human resource functions of the cabinet, including but not limited to providing administrative assistance; managing and preparing the cabinet’s budget; performing general accounting; managing fiscal, personnel, and payroll functions of the cabinet; providing statewide postal and printing services; providing administrative support to boards and commissions; and performing any additional administrative functions and duties the secretary may assign.
  2. There shall be established in the Office of Administrative Services:
    1. The Office of Budget and Fiscal Management, headed by an executive director who shall report directly to the executive director of the Office of Administrative Services, and consisting of the:
      1. Division of Budget; and
      2. Division of Fiscal Management; and
    2. The following divisions which shall be headed by a division director who shall report to the executive director of the Office of Administrative Services:
      1. Division of Human Resources;
      2. Division of Postal Services; and
      3. Division of Fleet Management.
  3. Executive directors and division directors appointed under this section shall be appointed by the secretary with the approval of the Governor under KRS 12.050 . Each division shall be headed by a division director appointed by the secretary of the Finance and Administration Cabinet. There may be, if needed, sections assigned to specific areas of work, responsible directly to the executive director of the Office of Administrative Services.

History. Enact. Acts 1978, ch. 155, § 49, effective June 17, 1978; 1982, ch. 393, § 22, effective July 15, 1982; 1994, ch. 214, § 1, effective July 15, 1994; 1994, ch. 216, § 5, effective July 15, 1994; 1994, ch. 508, § 9, effective July 15, 1994; 2000, ch. 5, § 2, effective July 14, 2000; repealed, reenact. and amend., Acts 2005, ch. 85, § 9, effective June 20, 2005; 2009, ch. 12, § 22, effective June 25, 2009; 2021 ch. 81, § 2, effective June 29, 2021.

Compiler’s Notes.

This section was formerly compiled as KRS 42.023 .

Legislative Research Commission Notes.

(7/15/94). This section was amended by 1994 Ky. Acts chs. 214, 216, and 508. Where these Acts are not in conflict, they have been codified together. Where a conflict exists between chs. 216 and 508, Acts ch. 508, which was last enacted by the General Assembly, prevails under KRS 446.250 .

This section was amended by 1982 Acts Chapter 183, Section 2 and 1982 Acts Chapter 393, Section 22 which conflict and cannot be compiled together. Pursuant to KRS 446.250 , the amendment in Chapter 393 prevails as the later enactment.

42.0172. Division of Postal Services.

The Division of Postal Services shall operate the centralized postal services for executive branch agencies as set forth in KRS 12.020 . The division shall operate at a central location with additional locations necessary to maintain and improve service levels.

History. Enact. Acts 1978, ch. 155, § 51, effective June 17, 1978; 1982, ch. 393, § 24, effective July 15, 1982; 1994, ch. 214, § 2, effective July 15, 1994; 1994, ch. 508, § 11, effective July 15, 1994; 1997 (1st Ex. Sess.), ch. 4, § 15, effective May 30, 1997; repealed, reenact. and amend., Acts 2005, ch. 85, § 10, effective June 20, 2005; 2009, ch. 12, § 23, effective June 25, 2009.

Compiler’s Notes.

This section was formerly compiled as KRS 42.025 .

42.0173. Office of Public Information. [Repealed]

History. Enact. Acts 2005, ch. 85, § 7, effective June 20, 2005; repealed by 2017 ch. 131, § 6, effective June 29, 2017.

Compiler’s Notes.

This section (Enact. Acts 2005, ch. 85, § 7, effective June 20, 2005), was repealed by Acts 2017, ch. 131, § 6, effective June 29, 2017.

42.0174. Office of Policy and Audit.

  1. The Office of Policy and Audit established within the Office of the Secretary by KRS 42.0145 shall have the duties and responsibilities established in KRS 42.065 .
  2. The Office of Policy and Audit shall be headed by an executive director who shall be appointed in accordance with KRS 12.050 and shall report to the secretary.

History. Enact. Acts 2009, ch. 12, § 1, effective June 25, 2009; 2012, ch. 69, § 3, effective July 12, 2012.

42.018. Office of Capital Plaza Operations. [Repealed]

HISTORY: Enact. Acts 1984, ch. 340, § 4, effective July 13, 1984; 1990, ch. 378, § 2, effective July 13, 1990; 1994, ch. 216, § 3, effective July 15, 1994; 1998, ch. 83, § 4, effective July 15, 1998; 2002, ch. 12, § 4, effective July 15, 2002; 2005, ch. 85, § 51, effective June 20, 2005; repealed by 2018 ch. 69, § 4, effective July 14, 2018.

42.019. Division of Historic Properties — State curator.

  1. The Division of Historic Properties established by KRS 42.425 shall be responsible for overseeing the management and preservation of state-owned historic properties including, but not limited to, the Executive Mansion, Old Governor’s Mansion, Vest Lindsey House, Berry Hill, and the State Capitol. In addition, the division shall be responsible for maintaining state-owned furniture, china, silver, and art works and the care, display, inventory, conservation, restoration, and storage of any state-owned item of historical significance.
  2. The Department of Parks and the Kentucky Horse Park may advise and consult the Division of Historic Properties in the operation, maintenance, restoration, conservation, and inventory of the state’s shrines and museums.
  3. The director of the Division of Historic Properties shall serve as state curator pursuant to KRS 11.026 . The director may employ the personnel and assemble the records and files necessary to perform the duties, responsibilities, and functions of the office.

History. Enact. Acts 1984, ch. 340, § 5, effective July 13, 1984; 1994, ch. 176, § 3, effective July 15, 1994; 2005, ch. 85, § 699, effective June 20, 2005; 2008, ch. 13, § 1, effective July 15, 2008.

42.0192. Office of Risk Management. [Amended and Redesignated]. [Transferred]

Compiler’s Notes.

This section (Enact. Acts 1990, ch. 377, § 1, effective July 13, 1990) was amended and redesignated as KRS 42.0245 by the Reviser of Statutes under the authority of KRS 7.136 and 7.140 .

42.020. Organization of department — Commissioner of finance — Deputy Commissioner. [Repealed.]

Compiler’s Notes.

This section (4618-86: amend. Acts 1954, ch. 187, § 1; 1956 (1st Ex. Sess.), ch. 7, Art. XVI, § 16) was repealed by Acts 1974, ch. 74, Art. II, § 12.

42.0201. Office of the Controller.

  1. There is created within the Finance and Administration Cabinet the Office of the Controller.
  2. The Office of the Controller shall be headed by an executive director appointed by the secretary of the Finance and Administration Cabinet with the approval of the Governor. The executive director shall function as the state controller, who shall be a person qualified by education and experience for the position and held in high professional esteem in the accounting community.
  3. The state controller shall be the Commonwealth’s chief accounting officer and shall be responsible for all aspects of accounting policies and procedures, financial accounting systems, and internal accounting control policies and procedures. The Office of the Controller shall establish guidelines for state personnel administration on issues relating to paycheck distribution dates, assignment of data elements to accurately report labor costs, assignment and tracking of actual expenditures by code, and coverage issues relating to Social Security and Medicare.
  4. The state controller; the executive director of the Office of Financial Management, Finance and Administration Cabinet; and the state budget director designated under KRS 11.068 shall develop and maintain the Commonwealth’s strategic financial management program.
  5. Executive directors and division directors appointed under this section shall be appointed by the secretary with the approval of the Governor.
  6. There are established in the Office of the Controller the following organizational entities:
    1. The Office of Financial Management, which shall be headed by an executive director, shall have the duties and responsibilities established in KRS 42.410 , and shall serve as administrative staff to the Turnpike Authority of Kentucky. The executive director shall serve as secretary to the authority;
    2. The Office of Material and Procurement Services, which shall be headed by an executive director and shall have the duties established in KRS 42.024 . There are established within the Office of Material and Procurement Services the following organizational entities:
      1. The Division of Professional Services and Training, which shall be headed by a division director who is appointed by the secretary of the Finance and Administration Cabinet pursuant to KRS 12.050 , and who shall report to the executive director; and
      2. The Division of Contract Management, which shall be headed by a division director who is appointed by the secretary of the Finance and Administration Cabinet pursuant to KRS 12.050 , and who shall report to the executive director;
    3. The Division of Local Government Services, which shall be headed by a division director and shall be responsible for:
      1. Providing property valuation administrators with fiscal, personnel, payroll, training, and other essential administrative support services;
      2. Overseeing Kentucky’s Social Security coverage program, including but not limited to all aspects of FICA wage reporting for state government and the Commonwealth’s Social Security coverage agreement;
      3. Serving as liaison between local governments and the federal Internal Revenue Service and Social Security Administration;
      4. Serving as the payroll and fiscal officer for the sheriff and clerk in counties over seventy thousand (70,000) in population, disbursing various reimbursements and expenditures to local governments and serving as liaison and conduit for all court fees associated with report of state money through the Circuit Courts;
      5. Directing the federal employment tax program for state employees; and
      6. Performing state government’s duties relating to the county fee system for local entities;
    4. The Office of Statewide Accounting Services, headed by an executive director appointed by the secretary of the Finance and Administration Cabinet, subject to the approval of the Governor. The executive director shall report directly to the state controller. The office shall perform financial record keeping functions at the state controller’s direction, and shall be responsible for the performance of the cabinet’s functions outlined in KRS 45.305 , 48.800 , and other related statutes. There is established within the Office of Statewide Accounting Services the Division of Customer Resource Center, which shall be headed by a division director appointed by the secretary pursuant to KRS 12.050 and who shall report to the executive director of the Office of Statewide Accounting Services. The division shall be responsible for:
      1. Providing a help desk for users of state government’s financial and procurement system, including state employee users and vendors and payees of the Commonwealth who do, or would like to do, business with the state;
      2. Training state employees in the use of state government’s financial and procurement system; and
      3. Assisting cabinet entities in improving the quality of their products and processes; and
    5. The Division of State Risk and Insurance Services, headed by a division director appointed by the secretary of the Finance and Administration Cabinet, subject to the approval of the Governor. The director shall report directly to the state controller and shall have the duties specified in KRS 42.0651 .

History. Enact. Acts 1994, ch. 508, § 1, effective July 15, 1994; 1998, ch. 85, § 1, effective July 15, 1998; 2000, ch. 5, § 5, effective July 14, 2000; 2000, ch. 46, § 5, effective July 14, 2000; 2005, ch. 85, § 11, effective June 20, 2005; 2009, ch. 12, § 24, effective June 25, 2009; 2012, ch. 69, § 4, effective July 12, 2012; 2016 ch. 84, § 1, effective July 15, 2016.

42.021. Governor’s advisory council to the office of volunteer services. [Amended and reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 155, § 47, effective June 17, 1978) was amended and reenacted as KRS 147A.008 (since repealed) by Acts 1980, ch. 295, § 14, effective July 15, 1980.

42.022. Functions and duties of deputy secretary for the office for policy and management. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 155, § 48, effective June 17, 1978; 1980, ch. 310, § 4, effective July 15, 1980; 1982, ch. 393, § 21, effective July 15, 1982) was repealed by Acts 1984, ch. 186, § 4, effective July 13, 1984.

42.023. Department for Administration — Duties — Organization. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 155, § 49, effective June 17, 1978; 1982, ch. 393, § 22, effective July 15, 1982; 1994, ch. 214, § 1, effective July 15, 1994; 1994, ch. 216, § 5, effective July 15, 1994; 1994, ch. 508, § 9, effective July 15, 1994; 2000, ch. 5, § 2, effective July 14, 2000) was repealed, reenacted and amended as KRS 42.0171 by Acts 2005 ch. 85, § 9, effective June 20, 2005.

42.024. Office of Material and Procurement Services.

The Office of Material and Procurement Services within the Office of the Controller shall be responsible for the performance of the cabinet’s purchasing functions under KRS Chapters 45 and 45A, except those purchasing functions related to the acquisition of interests in real property, and contractual and construction services which are related to and required in connection with the construction, renovation, and repair of state-owned buildings. The Office of Material and Procurement Services shall be responsible for the control of all state-purchased personal property.

History. Enact. Acts 1978, ch. 155, § 50, effective June 17, 1978; 1982, ch. 393, § 23, effective July 15, 1982; 1984, ch. 111, § 33, effective July 13, 1984; 1990, ch. 386, § 1, effective July 13, 1990; 1994, ch. 216, § 6, effective July 15, 1994; 1994, ch. 508, § 10, effective July 15, 1994; 2000, ch. 5, § 3, effective July 14, 2000; 2005, ch. 85, § 12, effective June 20, 2005.

Legislative Research Commission Note.

(7/15/94). This section was amended by 1994 Ky. Acts chs. 216 and 508. Where these Acts are not in conflict, they have been codified together. Where a conflict exists, Acts ch. 508, which was last enacted by the General Assembly, prevails under KRS 446.250 .

42.0245. Division of Risk Management. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1990, ch. 377, § 1, effective July 13, 1990; amend. and redesig. Acts 1994, ch. 116, § 3, effective July 15, 1994; 1994, ch. 216, § 4, effective July 15, 1994; 1998, ch. 82, § 12, effective July 15, 1998; 1998, ch. 154, § 62, effective July 15, 1998; 2001, ch. 164, § 3, effective June 21, 2001) was repealed, reenacted and amended as KRS 42.0651 by Acts 2005 ch. 85, § 14, effective June 20, 2005.

42.025. Division of Printing and Division of Postal Services — Duties. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 155, § 51, effective June 17, 1978; 1982, ch. 393, § 24, effective July 15, 1982; 1994, ch. 214, § 2, effective July 15, 1994; 1994, ch. 508, § 11, effective July 15, 1994; 1997 (1st Ex. Sess.), ch. 4, § 15, effective May 30, 1997) was repealed, reenacted and amended as KRS 42.0172 by Acts 2005, ch. 85, § 10, effective June 20, 2005.

42.026. Bureau of computer services established — Organization — Duties. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 155, § 52, effective June 17, 1978) was repealed by Acts 1982, ch. 393, § 51, effective July 15, 1982.

42.027. Department for Facilities Management — Organization — Duties — Responsibilities. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 155, § 53, effective June 17, 1978; 1982, ch. 393, § 25, effective July 15, 1982; 1992, ch. 41, § 2, effective July 14, 1992; 1994, ch. 176, § 2, effective July 15, 1994; 1998, ch. 68, § 3, effective July 15, 1998; 1998, ch. 87, § 1, effective July 15, 1998; 2002, ch. 19, § 1, effective July 15, 2002) was repealed, reenacted and amended as KRS 42.425 by Acts 2005, ch. 85, § 17, effective June 20, 2005.

42.0271. Plaque commemorating prisoners and missing soldiers in Vietnam War — Duties of Department of Veterans’ Affairs and Department of Facilities Management relating to plaque and Freedom Tree. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 2002, ch. 256, § 1, effective July 15, 2002) was repealed, reenacted and amended as KRS 42.430 by Act 2005, ch. 85, § 18, effective June 20, 2005.

42.028. Bureau of public properties established — Organization — Duties. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 155, § 54, effective June 17, 1978; 1980, ch. 295, § 15, effective July 15, 1980) was repealed by Acts 1982, ch. 393, § 51, effective July 15, 1982.

42.029. Department of Information Systems — Commissioner and other personnel — Divisions — Duties — Delegation of authority. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1982, ch. 393, § 17, 18, effective July 15, 1982; 1984, ch. 111, § 34, effective July 13, 1984; 1984, ch. 404, § 9, effective July 13, 1984; 1988, ch. 306, § 1, effective July 15, 1988; 1994, ch. 474, § 1, effective July 15, 1994; 1998, ch. 68, § 4, effective July 15, 1998; 1998, ch. 353, § 8, effective July 15, 1998) was repealed by Acts 2000, ch. 506, § 25, effective July 14, 2000; and Acts 2000, ch. 536, § 37, effective July 14, 2000. For present law, see KRS 11.501 et seq.

42.030. General functions of department. [Repealed.]

Compiler’s Notes.

This section (4618-43, 4618-85: amend. Acts 1956 (1st Ex. Sess.), ch. 7, Art. XVI, § 17; 1968, ch. 119, § 12; 1974, ch. 74, Art. II, § 9(1); 1982, ch. 393, § 26, effective July 15, 1982) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.301 .

42.032. Web site to provide public access to expenditure records of executive branch — Monthly and weekly updates — Cabinet is sole custodian of information and records — Branches to share software and applications.

  1. By January 1, 2012, the Finance and Administration Cabinet shall provide public access to records relating to expenditures of the executive branch of state government through display of the records on a Web site. The Web site shall provide:
    1. Financial information of expenditures not exempt under the provisions of state or federal law, including:
      1. The payee name;
      2. The category or type of the expenditure;
      3. A description of the reason for the expenditure, if available;
      4. The expenditure amount; and
      5. A link to the financial document, if the document is electronically available;
    2. A searchable format;
    3. Access to the current enacted Executive Branch Budget; and
    4. A link to the public access Web site displays of the legislative and judicial branches of state government, and of the public institutions of higher education.
  2. Information on the Web site shall be updated at least on a monthly basis. However, information on the Web site which is part of, or contained in, an electronic accounting system utilized by all branches of state government, such as the Enhanced Management Administrative Reporting System (EMARS), shall be updated on a weekly basis.
  3. The cabinet shall maintain exclusive control and be considered the sole custodian of all information and records generated by and through activity of the executive branch of government, notwithstanding the situs of the information and the records in another branch of government, and disclosure thereof shall only be by the cabinet in accordance with applicable law.
  4. In order to reduce Web site development costs and enhance public access and use of records viewed through Web sites as provided by this section and KRS 7.505 and 26A.260, each branch of state government shall freely share with the other branches of state government the software, software developments, and all applications, data, and information within its control used for Web site design, appearance, content, and operation in compliance with, or in furtherance of, the purposes contemplated by this section and KRS 7.505 and 26A.260.

History. Enact. Acts 2011, ch. 105, § 3, effective June 8, 2011.

42.035. Executive Mansion — Maintenance and operation — Duties of cabinet as to food, personnel and Governor’s travel expenses.

  1. The Finance and Administration Cabinet shall be responsible for the management, maintenance, and operation, including the purchase for all purposes of all food and related supplies, of the Executive Mansion, and further including the reasonable and necessary expenses of the chief executive while traveling on business of the Commonwealth outside of the state. Such personnel, including domestic and household servants, as are necessary for the operation and maintenance of the Executive Mansion shall be employed by the Finance and Administration Cabinet. The provisions of KRS Chapter 42 shall apply to all purchases made for the maintenance and operation of the mansion. None of the provisions of KRS 18A.110 and 18A.155 shall apply to personnel employed for the maintenance and operation of the mansion.
  2. A reasonable amount shall be deducted from the salary or other allowance of the Governor for the consumption by the Governor and his family of such food and supplies.
  3. A reasonable amount shall be deducted from the salaries of personnel employed in operational and maintenance functions, including domestic and household servants, for the consumption by such personnel of such food and supplies.
  4. The Finance and Administration Cabinet shall maintain such records relative to the management, maintenance, and operation of the Governor’s Mansion and travel expenses of the chief executive as may be dictated by sound accounting practices.

History. Enact. Acts 1956, ch. 11, § 1; 1962, ch. 210, § 6; 1964, ch. 18, § 1; 1974, ch. 74, Art. II, § 9(1); 1982, ch. 448, § 60, effective July 15, 1982.

Opinions of Attorney General.

While there appears to be no problem in citizens voluntarily making a donation to see the governor’s mansion, the Finance and Administration Cabinet has no statutory authority to charge fees or ticket costs to the public for a tour of the Governor’s Mansion, either for a one-time situation or more; further, the cabinet has no authority to permit a nonprofit corporation organized to raise funds for the mansion renovation to sell tickets to the public for such a tour of the Governor’s Mansion. OAG 83-120 .

42.037. Old Governor’s Mansion, maintenance and operation — Duties of cabinet as to food, personnel.

  1. The Finance and Administration Cabinet shall be responsible for the management, maintenance, and operation, including the purchase for all purposes of all food and related supplies, of the Old Governor’s Mansion. Such personnel, including domestic and household servants, as are necessary for the operation and maintenance of the Old Governor’s Mansion shall be employed by the Finance and Administration Cabinet. The provisions of this chapter shall apply to all purchases made for the maintenance and operation of the Old Governor’s Mansion. None of the provisions of KRS 18A.110 and 18A.155 shall apply to the personnel employed for the maintenance and operation of the Old Governor’s Mansion.
  2. A reasonable amount shall be deducted from the salary or other allowance of the Lieutenant Governor for the consumption by the Lieutenant Governor and his family of such food and supplies.
  3. A reasonable amount shall be deducted from the salaries of personnel employed in operational and maintenance functions, including domestic and household servants, for the consumption by such personnel of such food and supplies.
  4. The Finance and Administration Cabinet shall maintain such records relative to the management, maintenance, and operation of the Lieutenant Governor’s mansion as may be dictated by sound accounting practices.

History. Enact. Acts 1956, ch. 94, § 1; 1964, ch. 18, § 2; 1974, ch. 74, Art. II, § 9(1); 1982, ch. 448, § 61, effective July 15, 1982.

Compiler’s Notes.

This section was formerly compiled as KRS 56.325 .

42.038. Vest Lindsey House — Use as state meeting house and visitor information center.

  1. The Division of Historic Properties shall establish the Vest Lindsey House as a state meeting house and restrict its use, except as provided in subsection (3) of this section, to small meetings, luncheons, receptions, and other similar functions deemed appropriate by the Historic Properties Advisory Commission.
  2. The use of the Vest Lindsey House as a state meeting house, as provided in subsection (1) of this section, shall be available to state and local government agencies, nonprofit organizations, and private persons and entities, all subject to availability and with the approval of the director of the Division of Historic Properties or his or her designee.
  3. In addition to the use of the Vest Lindsey House as a state meeting house, the Division of Historic Properties shall maintain the Vest Lindsey House as a central visitor information center for the North Frankfort area, and, in consultation with the Kentucky Heritage Council, shall develop and display interpretative materials and other resources regarding the historical and architectural significance of the Vest Lindsey House and other sites in the North Frankfort area.

History. Enact. Acts 2008, ch. 24, § 1, effective July 15, 2008.

42.040. Division of the budget. [Repealed.]

Compiler’s Notes.

This section (4618-87) was repealed by Acts 1974, ch. 74, Art. II, § 12.

42.050. Division of accounts. [Repealed.]

Compiler’s Notes.

This section (4618-88: amend. Acts 1954, ch. 187, § 2, effective June 17, 1954) was repealed by Acts 1974, ch. 74, Art. II, § 12.

42.055. Division of services. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1954, ch. 187, § 4, effective June 17, 1954) was repealed by Acts 1974, ch. 74, Art. II, § 12.

42.060. Division of Purchases. [Repealed.]

Compiler’s Notes.

This section (4618-89: amend. Acts 1942, ch. 14; 1954, ch. 187, § 3) was repealed by Acts 1964, ch. 16, § 8. For present law see KRS 45A.045 .

42.061. Division of purchases. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1964, ch. 16, § 1(1)) was repealed by Acts 1974, ch. 74, Art. II, § 12.

42.062. Definition for KRS 42.064 and 42.066. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1962, ch. 106, Art. V, § 5) was repealed by Acts 1982, ch. 393, § 51, effective July 15, 1982.

42.064. Division of occupations and professions. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1962, ch. 106, Art. V, § 6; 1974, ch. 74, Art. II, § 7) was repealed by Acts 1982, ch. 393, § 51, effective July 15, 1982.

42.065. Powers of Office of Policy and Audit.

  1. The Office of Policy and Audit established in the Office of the Secretary in KRS 42.0145 may, with the approval of the secretary of the Finance and Administration Cabinet, conduct any internal audit, investigation, or management review in the Finance and Administration Cabinet related to the secretary’s duties and responsibilities as chief financial officer of the Commonwealth pursuant to KRS 42.012 .
  2. When it is necessary to complete an internal audit, investigation, or management review in the Finance and Administration Cabinet, with the written approval of the secretary of the Finance and Administration Cabinet, the Office of Policy and Audit shall have access during business hours to all books, reports, papers, and accounts in the office or under the custody or control of any budget unit, or of any other program cabinet, department, or agency under the authority and direction of the Governor.

History. Enact. Acts 1986, ch. 242, § 1, effective July 15, 1986; 1994, ch. 216, § 7, effective July 15, 1994; 1998, ch. 68, § 5, effective July 15, 1998; 2000, ch. 5, § 4, effective July 14, 2000; 2005, ch. 85, § 13, effective June 20, 2005; 2009, ch. 12, § 25, effective June 25, 2009.

42.0651. Duties of Division of State Risk and Insurance Services — Assistance from other agencies — Risk management program.

  1. The Division of State Risk and Insurance Services shall:
    1. Oversee and assist the management of the state fire and tornado insurance fund established in KRS Chapter 56;
    2. Develop and manage programs of risk assessment and insurance for the protection of state property not covered by the state fire and tornado insurance fund;
    3. Advise the secretary of the Finance and Administration Cabinet on the fiscal management of programs relating to life insurance, workers’ compensation, and health care benefits for state employees;
    4. Serve as the central clearinghouse for coordinating and evaluating existing and new risk management programs within all state agencies;
    5. Develop financing techniques for risk protection;
    6. Provide insurance for all state-owned and state-operated facilities and vehicles; and
    7. Develop and implement other risk management, insurance, and self-insurance programs or other functions and duties as the secretary of the Finance and Administration Cabinet may direct the division to undertake and implement within the general statutory authority and control of the Finance and Administration Cabinet over state property and fiscal affairs of the executive branch of state government, including, but not limited to, those areas pertaining to tort and contractual liability, fidelity, and property risks.
  2. Nothing in this section shall be construed or interpreted as affecting the operation of the employee benefit programs generally administered by the Office of Employee  Relations and Department of Employee Insurance within the Personnel Cabinet. These agencies shall coordinate the operation of life insurance, workers’ compensation, health care benefit programs, and other self-insured programs with the Division of State Risk and Insurance Services.
  3. All cabinets, departments, boards, commissions, and other state agencies shall provide to the Division of State Risk and Insurance Services the technical advice and other assistance the Division of State Risk and Insurance Services or the secretary of the Finance and Administration Cabinet shall request in the performance of the functions of the division as described in this section.
  4. The secretary of the Finance and Administration Cabinet shall have the power and authority to promulgate administrative regulations pursuant to KRS Chapter 13A for purposes of implementing a risk management program for the executive branch of state government. Any administrative regulations promulgated by the secretary shall be administered by the Division of State Risk and Insurance Services.

History. Enact. Acts 1990, ch. 377, § 1, effective July 13, 1990; amend. and redesig. Acts 1994, ch. 116, § 3, effective July 15, 1994; 1994, ch. 216, § 4, effective July 15, 1994; 1998, ch. 82, § 12, effective July 15, 1998; 1998, ch. 154, § 62, effective July 15, 1998; 2001, ch. 164, § 3, effective June 21, 2001; repealed, reenact. and amend., Acts 2005, ch. 85, § 14, effective June 20, 2005; 2010, ch. 24, § 32, effective July 15, 2010; repealed, reenact. and amend, Acts 2012, ch. 69, § 2, effective July 12, 2012; 2012, ch. 10, § 7, effective July 12, 2012.

Compiler’s Notes.

This section was formerly compiled as KRS 42.0245 .

Legislative Research Commission Note.

(7/12/2012). This statute was amended by 2012 Ky. Acts ch. 10 and repealed, reenacted, and amended by 2012 Ky. Acts ch. 69, which do not appear to be in conflict and have been codified together.

(7/15/94). This statute was formerly codified as KRS 42.0192 and was renumbered by the Reviser of Statutes pursuant to KRS 7.136(1)(a) because of changes made by 1994 Ky. Acts ch. 216, sec. 4.

42.066. Division of Occupations and Professions — Services for boards and commissions — Charges — Complaints — Acceptance of personal checks in payment of license renewal fees. [Repealed and reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1962, ch. 106, Art. V, § 7; 1974, ch. 74, Art. II, § 8; 1976, ch. 307, § 1; 1978, ch. 384, § 10, effective June 17, 1978; 1982, ch. 393, § 27, effective July 15, 1982; 1984, ch. 17, § 1, effective July 13, 1984; 1996, ch. 369, § 2, effective July 15, 1996; 2005, ch. 11, § 1, effective June 20, 2005; 2008, ch. 59, § 7, effective July 15, 2008) was repealed and reenacted as KRS 224.10-052 by Acts 2009, ch. 12, § 16, effective June 25, 2009.

42.068. Activation of KRS 42.064 and 42.066. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1962, ch. 106, Art. V, § 8) was repealed by Acts 1974, ch. 74, Art. II, § 12.

42.070. Manner for letting contracts for materials, supplies and equipment; advertisement. [Repealed.]

Compiler’s Notes.

This section (3990-15: amend. Acts 1942, ch. 119, §§ 1, 2; 1950, ch. 57; 1956 (1st Ex. Sess.), ch. 7, Art. XVI, § 19) was repealed by Acts 1964, ch. 16, § 8.

42.071. Purchases from the federal government or a federal agency. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1946, ch. 154) was repealed by Acts 1966, ch. 125, § 2.

42.072. Purchase price to be set out in bill of sale or deed. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1950, ch. 132) was repealed by Acts 1966, ch. 110, § 2.

42.075. Preferred status of products of the blind. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1958, ch. 86; 1974, ch. 74, Art. II, § 9(3); 1976, ch. 377, § 4) was repealed by Acts 1982, ch. 170, § 3, effective July 15, 1982.

42.076. Collusion to restrain bids prohibited — Affidavit. [Repealed and reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1964, ch. 178, § 1; 1966, ch. 126, § 1) was renumbered as KRS 45.460 which section was repealed and reenacted by Acts 1978, ch. 110, § 65 effective January 1, 1979, as KRS 45A.325 .

42.080. Names of seller’s representatives to accompany bid or estimate for contract with state agency. [Repealed.]

Compiler’s Notes.

This section (3990-19) was repealed by Acts 1942, ch. 122, § 4.

42.090. Names of seller’s representatives to appear on invoice. [Repealed.]

Compiler’s Notes.

This section (3990-20) was repealed by Acts 1942, ch. 122, § 4.

42.100. Representatives to be listed with Secretary of State. [Repealed.]

Compiler’s Notes.

This section (3990-21) was repealed by Acts 1942, ch. 122, § 4.

42.110. Division of Personnel Efficiency. [Repealed.]

Compiler’s Notes.

This section (4618-90) was repealed by Acts 1956 (1st Extra. Sess.), ch. 7, Art. IV, § 6, effective July 1, 1956.

42.120. Examination and classification of state employes. [Repealed.]

Compiler’s Notes.

This section (4618-90) was repealed by Acts 1956 (1st Extra. Sess.), ch. 7, Art. IV, § 6, effective July 1, 1956.

42.130. Change of status of employes; payrolls to be checked. [Repealed.]

Compiler’s Notes.

This section (4618-90) was repealed by Acts 1956 (1st Extra. Sess.), ch. 7, Art. IV, § 6, effective July 1, 1956.

42.140. Removal of state employes. [Repealed.]

Compiler’s Notes.

This section (4618-90) was repealed by Acts 1956 (1st Extra. Sess.), ch. 7, Art. IV, § 6, effective July 1, 1956.

42.150. Political activity prohibited. [Renumbered and Repealed.]

Compiler’s Notes.

This section (4618-90) was renumbered as KRS 18.080 and repealed by Acts 1960, ch. 63, § 26.

42.160. Mismanagement of state affairs, duty of department in case of. [Repealed.]

Compiler’s Notes.

This section (1992b-61: amend. Acts 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.131 .

42.170. Functions of state local debt officer exercised by Office of the Controller. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1960, ch. 68, Art. V, §§ 1, 2; 1966, ch. 255, § 50; 1974, ch. 74, Art. II, § 9(1); 1978, ch. 155, § 46, effective June 17, 1978; 1982, ch. 393, § 28, effective July 15, 1982; 1994, ch. 508, § 12, effective July 15, 1994) was repealed by Acts 1998, ch. 85, § 7, effective July 15, 1998.

42.180. Transfer of archives and records functions to department. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1962, ch. 106, Art. V, § 1) was repealed by Acts 1974, ch. 74, Art. II, § 12.

42.190. Cost projections of Firefighters Foundation Program fund and Law Enforcement Foundation Program fund — Disposition of funds collected under KRS 136.392 — Lapsing of certain funds — Monthly reports.

  1. On June 1, 1982, and then on or before the first day of each December, March, June, and September thereafter, the cabinet shall request in writing of the administrator of the Firefighters Foundation Program fund, which is established by KRS 95A.220 , and of the administrator of the Law Enforcement Foundation Program fund, which is established by KRS 15.430 , cost projections of their respective funds for the next quarter. Based on these projections, the cabinet shall determine the proportionate share of total insurance premium surcharge proceeds, prescribed in KRS 136.392 , to accrue to each fund.
  2. On or before the first day of each quarter, the cabinet shall certify to the State Treasurer a distribution schedule describing the proportionate share of total insurance premium surcharge proceeds accruing to each fund during such quarter, and the State Treasurer shall pay into each fund’s trust and agency account its proportionate share of all deposited tax moneys as set forth and in the manner as prescribed in KRS 136.392 .
  3. Moneys deposited in the Firefighters Foundation Program fund’s trust and agency account, and in the Law Enforcement Foundation Program fund’s trust and agency account, shall be invested by the state in accordance with state investment practices, and all earnings from such investments shall accrue to, and be paid into the respective account from which such investments are made. All moneys remaining on deposit at the close of the state’s fiscal year in the Firefighters Foundation Program fund’s trust and agency account and all earnings from investments made from moneys in this account in excess of three million dollars ($3,000,000), beginning with fiscal year 1994-95, through June 30, 1999, shall lapse, except that moneys in the revolving loan fund established in KRS 95A.262 shall not lapse. All moneys remaining on deposit at the close of the state’s fiscal year in the Law Enforcement Foundation Program fund’s trust and agency account, and all earnings from investments made from moneys in this account, in excess of three million dollars ($3,000,000), beginning with fiscal year 1994-95, through June 30, 1999, shall lapse. On and after July 1, 1999, moneys in these accounts shall not lapse.
  4. The cabinet shall provide monthly financial reports to the administrator of the Firefighters Foundation Program fund and the administrator of the Law Enforcement Foundation Program fund respecting the amount of funds received and on deposit in each fund and the amount of earnings accruing to each fund from their investment.

History. Enact. Acts 1982, ch. 246, § 2, effective July 15, 1982; 1984, ch. 300, § 2, effective July 13, 1984; 1992, ch. 381, § 6, effective July 14, 1992; 1998, ch. 244, § 6, effective July 15, 1998; 1998, ch. 510, § 6, effective July 15, 1998.

Legislative Research Commission Note.

(7/15/98). This section was amended by 1998 Ky. Acts ch. 244, sec. 6, and ch. 510, sec. 6, which are identical and have been codified together.

NOTES TO DECISIONS

1.Valid Emergency Clause.

The reason stated in the emergency clause of Acts 1982, ch. 246 which act deals generally with a surcharge upon certain insurance premiums collected in the state which is intended to fund a trust for the payment of incentives to the firefighters and policemen of the various municipalities, to the effect that the general fund appropriations for fiscal year 1981-82 for the professional Firefighters Foundation Program fund as provided by KRS 95A.200 through 95A.990 , and the Law Enforcement Foundation Program fund as provided by KRS 15.410 through 15.510 , would lapse on June 30, 1982, sufficiently supported the legislative declaration of an emergency. American Ins. Asso. v. Geary, 635 S.W.2d 306, 1982 Ky. LEXIS 265 ( Ky. 1982 ).

42.200. Water project interest rate buy down fund — Funding sources, purposes, uses, and administration.

  1. The water project interest rate buy down fund is hereby created as a special fund in the State Treasury. The fund may receive state appropriations, gifts, grants, and federal funds and shall include earnings from investments of moneys in the fund. Any fund balance at the close of the fiscal year shall not lapse but shall be carried forward to the next fiscal year, and moneys in this fund shall be continuously appropriated only for the purposes specified in this section.
  2. The fund shall be used to provide financial assistance to government agencies for the construction of publicly owned water supply projects located in rural areas of the Commonwealth. In order to qualify for the financial assistance, the governmental agency shall obtain a loan from a bank or combined bank and trust company organized under the laws of this Commonwealth and at an interest rate no greater than two (2) percentage points higher than the current prime rate. The financial assistance provided shall consist of an annual grant to the governmental agency to be made over the life of the loan obtained by the governmental agency for the construction of the publicly owned water supply project. The amount of the annual grant shall be calculated over the life of the loan to provide to the governmental agency each year the portion of the interest on the loan calculated at a four percent (4%) interest rate. The governmental agency shall be responsible for the payment of the interest on the loan in excess of the four percent (4%) interest rate and for the payment of the principal on the loan.
  3. The Finance and Administration Cabinet shall administer the fund and may promulgate administrative regulations as necessary to implement the provisions of this section. The Department for Local Government shall advise government agencies of the fund and how to apply for moneys from the fund.
  4. The provisions of this section shall be known and may be cited as the Kentucky Rural Water Act.

History. Enact. Acts 1996, ch. 322, § 1, effective July 15, 1996; 1998, ch. 69, § 6, effective July 15, 1998; 2007, ch. 47, § 14, effective June 26, 2007; 2010, ch. 117, § 20, effective July 15, 2010.

42.205. Permanent pension fund.

  1. There is hereby established within the Finance and Administration Cabinet the Kentucky permanent pension fund for the purpose of addressing the Commonwealth’s unfunded pension liabilities. The proceeds contained in this fund shall be used only for contributions to the Commonwealth’s pension funds.
  2. The fund may receive:
    1. State appropriations;
    2. The net proceeds from the sale of real property owned by the Commonwealth or any agency thereof; and
    3. Any settlements or judgments resulting from litigation in which the Commonwealth or any of its agencies is a party, after costs of litigation and mandatory deductions or restitution to consumers have been deducted.
  3. Any unallotted or unencumbered balances in the fund shall be invested pursuant to KRS 42.500 .
  4. Income earned from the investments shall be credited to and become part of the fund.
  5. Notwithstanding KRS 45.229 , any fund balance at the close of the fiscal year shall not lapse but shall be carried forward to the next fiscal year. All amounts in the fund shall remain in the fund and shall not be expended or appropriated without the express authority in an enacted biennial budget bill.

HISTORY: 2016 ch. 133, § 8, effective July 15, 2016.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. V, D, 2 at 940.

42.210. Office of state curator established — Purpose. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 1) was repealed by Acts 1972, ch. 309, § 1.

42.220. Qualifications — Selection — Terms — Salary. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 2) was repealed by Acts 1972, ch. 309, § 1.

42.230. Curator to be in department of finance and work with department. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 3) was repealed by Acts 1972, ch. 309, § 1.

42.240. Curator to replace mansion committee — Duties. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 4) was repealed by Acts 1972, ch. 309, § 1.

42.250. Acceptance of gifts — Articles of dedication. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 5) was repealed by Acts 1972, ch. 309, § 1.

42.260. Duties as to items removed from executive mansion, old governor’s mansion, state shrines and historic homes. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 6) was repealed by Acts 1972, ch. 309, § 1.

42.270. Inventory. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 7) was repealed by Acts 1972, ch. 309, § 1.

42.280. Use or storage of items by governor or lieutenant governor — Procedure as to new items. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 8) was repealed by Acts 1972, ch. 309, § 1.

42.290. Cooperation by departments, agencies, etc. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1970, ch. 159, § 9) was repealed by Acts 1972, ch. 309, § 1.

42.300. Coal producing county development fund. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1974, ch. 262, § 2; 1978, ch. 155, § 41, effective June 17, 1978) was repealed by Acts 1980, ch. 394, § 13, effective July 1, 1980. For present law, see KRS 42.245 to 42.495 .

42.310. Advisory committee — Membership — Functions. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1974, ch. 262, § 4; 1978, ch. 155, § 41, effective June 17, 1978; 1978, ch. 188, § 6, effective June 17, 1978) was repealed by Acts 1980, ch. 394, § 13, effective July 1, 1980. For present law, see KRS 42.450 to 42.495 .

42.320. Court cost distribution fund — Disbursements — Payments into general fund.

  1. There is hereby established the court cost distribution fund, which is created to provide a central account into which the court costs collected by all circuit clerks, under KRS 23A.205(1) and 24A.175(1), shall be paid.
  2. The fund shall be administered by the Finance and Administration Cabinet, which shall make monthly disbursements from the fund according to the following schedule:
    1. Forty-nine percent (49%) of each court cost shall be paid into the general fund;
    2. Ten and eight-tenths percent (10.8%) of each court cost, up to five million four hundred thousand dollars ($5,400,000), shall be paid into the State Treasury for the benefit and use of the Kentucky Local Correctional Facilities Construction Authority under KRS 441.605 to 441.695 ;
    3. Six and one-half percent (6.5%) of each court cost, up to three million two hundred fifty thousand dollars ($3,250,000), shall be paid into the spinal cord and head injury research trust fund created in KRS 211.504 ;
    4. Five and one-half percent (5.5%) of each court cost, up to two million seven hundred fifty thousand dollars ($2,750,000), shall be paid into the traumatic brain injury trust fund created in KRS 211.476 ;
    5. Five percent (5%) of each court cost, up to two million five hundred thousand dollars ($2,500,000), shall be paid into a trust and agency account with the Administrative Office of the Courts and is to be used by the circuit clerks to hire additional deputy clerks and to enhance deputy clerk salaries;
    6. Three and one-half percent (3.5%) of each court cost, up to one million seven hundred fifty thousand dollars ($1,750,000), shall be paid to a special trust and agency account that shall not lapse for the Department of Public Advocacy;
    7. Three and four-tenths percent (3.4%) of each court cost, up to one million seven hundred thousand dollars ($1,700,000), shall be paid into the crime victims” compensation fund created in KRS 49.480 ;
    8. Seven-tenths of one percent (0.7%) of each court cost, up to three hundred fifty thousand dollars ($350,000), shall be paid to the Justice and Public Safety Cabinet to defray the costs of conducting record checks on prospective firearms purchasers pursuant to the Brady Handgun Violence Prevention Act and for the collection, testing, and storing of DNA samples;
    9. Ten and one-tenth percent (10.1%) of each court cost, up to five million fifty thousand dollars ($5,050,000), deposited in the fund shall be paid to the county sheriff in the county from which the court cost was received; and
    10. Five and one-half percent (5.5%) of each court cost, up to two million seven hundred fifty thousand dollars ($2,750,000), deposited in the fund shall be paid to the county treasurer in the county from which the court cost was received and shall be used by the fiscal court in that county for the purposes of defraying the costs of operation of the county jail and the transportation of prisoners.
  3. Any moneys remaining in the fund after the monthly disbursements in subsection (2) of this section shall be paid into the general fund.
  4. Any moneys collected above the prescribed amount shall be paid into the general fund.

HISTORY: Enact. Acts 2002, ch. 183, § 9, effective August 1, 2002; 2007, ch. 85, § 123, effective June 26, 2007; 2017 ch. 74, § 60, effective June 29, 2017; 2017 ch. 167, § 11, effective June 29, 2017.

Legislative Research Commission Notes.

(6/29/2017). This statute was amended by 2017 Ky. Acts chs. 74 and 167, which do not appear to be in conflict and have been codified together.

(6/26/2007). 2007 Ky. Acts ch. 85, relating to the creation and organization of the Justice and Public Safety Cabinet, instructs the Reviser of Statutes to correct statutory references to agencies and officers whose names have been changed in that Act. Such a correction has been made in this section.

(7/15/2002). This statute number, KRS 42.320 , was previously used for a KRS section that was repealed. That earlier section (1974 Ky. Acts ch. 74, Art. VIII, Part I, sec. 1; 1982 Ky. Acts ch. 396, sec. 5) was repealed by 1982 Ky. Acts ch. 450, sec. 79, effective July 1, 1983. The catchline at repeal read, “State clearinghouse functions for federal funds.”

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, H, 4, (2) at 888.

42.325. Definitions for KRS 42.330 to 42.340. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 188, § 1, effective June 17, 1978) was repealed by Acts 1980, ch. 394, § 13, effective July 1, 1980. For present law, see KRS 42.450 to 42.495 .

42.330. Coal severance economic aid fund — Use — Board. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1976, ch. 338, § 1; 1978, ch. 100, § 1, effective June 17, 1978; 1978, ch. 188, § 2, effective June 17, 1978) was repealed by Acts 1980, ch. 394, § 13, effective July 1, 1980. For present law, see KRS 42.450 to 42.495 .

42.332. Examination and approval of capital projects. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 188, § 3, effective June 17, 1978) was repealed by Acts 1980, ch. 394, § 13, effective July 1, 1980. For present law, see KRS 42.450 to 42.495 .

42.334. Apportionment of funds. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 188, § 4, effective June 17, 1978) was repealed by Acts 1980, ch. 394, § 13, effective July 1, 1980. For present law, see KRS 42.450 to 42.495 .

42.340. Rules and regulations as to coal severance economic aid fund and projects. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 338, § 2) was repealed by Acts 1980, ch. 394, § 13, effective July 1, 1980. For present law, see KRS 42.450 to 42.495 .

Capital Projects in Area Development Districts

42.345. Definitions for KRS 42.350 to 42.370.

As used in KRS 42.350 to 42.370 the words:

  1. “Beneficiary agency” means an agency eligible to receive the benefit of a capital project to be wholly or partly financed out of the area development fund, including and limited to political subdivisions, special districts and agencies created pursuant to the Interlocal Cooperation Act, or any combination thereof; and, not-for-profit corporations organized for public purposes and performing governmental functions and services;
  2. “Fund” means the area development fund established in the State Treasury by KRS 42.350 .

History. Enact. Acts 1978, ch. 187, § 1, effective June 17, 1978.

Compiler's Notes.

The Interlocal Cooperation Act referred to in subdivision (1) of this section is compiled as KRS 65.210 to 65.300 .

Opinions of Attorney General.

Even though a beneficiary agency is a public corporation in terms of the nature of its governmental purpose, there is no express statutory provision making bidding procedure mandatory where it is formed pursuant to KRS Chapter 273. OAG 79-577 .

Where the acquisition of property was legal at the time of acquisition, the fact that it was acquired without bidding does not bar the corporation from subsequently obtaining the assistance of either the coal severance economic aid fund or the area development fund in retiring preexisting debts. OAG 79-577 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 13, (1) at 856.

42.350. Area development fund for capital projects.

  1. The area development fund in the State Treasury shall be administered by the Department for Local Government. The fund may receive state appropriations, gifts, grants, and federal funds and shall be disbursed by the State Treasurer upon the warrant of the commissioner of the Department for Local Government. Any unallotted or unencumbered balances in the fund shall be invested in United States government securities maturing not later than one (1) year from the date of investment, and the income from the investments shall be prorated for expenditure for capital projects in area development districts according to the formula provided in KRS 42.370 .
  2. Money in the fund shall be used only for capital projects which contribute to community or industrial development in the Commonwealth, KRS 48.300 and 48.500 notwithstanding. Capital projects eligible for financing out of the fund include and shall be limited to:
    1. The construction, reconstruction, renovation, and maintenance of buildings and other improvements to real estate;
    2. The acquisition of real property and interests in real property;
    3. The purchase of major items of equipment;
    4. Industrial site development projects, including land reclamation, clearing, grading, draining, landscaping, and the construction of walkways and fences;
    5. The extension and installation of water, gas, sewer, and electrical utilities lines to public facilities and industrial sites;
    6. The provision of solid waste management or disposal systems bringing counties into compliance with state or federal law. All expenses incurred in connection with or incidental to the construction or acquisition of a capital project under this section, including architectural, engineering, legal, and other expenses required for the projects may be paid out of the fund. Money in the fund may be used to retire a mortgage or other indebtedness encumbering an eligible capital project made within the preceding five (5) calendar years to secure the repayment of moneys loaned or advanced to finance the construction or acquisition of the project and may be used in match or in combination with funds obtained from other sources for an eligible capital project. No money shall be expended out of the fund, directly or indirectly, to pay or reimburse the cost of any feasibility study, master plan for any capital improvement development or redevelopment project, the purchase of consumable supplies or any administrative salary, or other operating or capital expense of any area development district or for the acquisition, construction, reconstruction, renovation, or maintenance of any building or property of schools, state institutions of higher learning, or any road, street, bridge, or highway.
  3. The board of directors of each area development district shall determine from among the capital project proposals submitted by eligible beneficiary agencies, the capital projects to be proposed to be constructed or acquired out of the fund. The area development districts shall submit to the commissioner of the Department for Local Government the capital projects selected for construction or acquisition within the districts. Each project proposal shall include: a detailed description of the project; a statement of the public benefit to be derived from the project; if available, design plans and specifications for the project; an itemized estimate of the cost of the project; a statement of the sources and amounts of funds available from any other source for the construction or acquisition of the project; and other information relating to the proposed capital project as the Department for Local Government may require.

History. Enact. Acts 1976, ch. 339, § 1; 1978, ch. 187, § 2, effective June 17, 1978; 1984, ch. 111, § 35, effective July 13, 1984; 1984, ch. 404, § 42, effective July 13, 1984; 1998, ch. 69, § 7, effective July 15, 1998; 2007, ch. 47, § 15, effective June 26, 2007; 2010, ch. 117, § 21, effective July 15, 2010.

Opinions of Attorney General.

The restriction against encumbrances applies to private business enterprises acquiring industrial development properties for completion of an industrial development purpose. OAG 77-51 .

Engineering and architectural design costs for a capital project, as a condition for consideration of a construction grant by a federal agency, are eligible for payment from the economic aid fund or the area development fund, regardless of whether the capital project is completed or not. OAG 77-565 .

Since a landing or wharf constructed on city property would be a legitimate municipal improvement, a fourth-class city could use area development funds to construct a ferry boat landing on city-owned property. OAG 77-651 .

Although this section prohibits the encumbrance of a capital improvement project, the use of area development funds for the renovation of a county courthouse would not be in conflict with the statute. OAG 77-714 .

Land leased from a county board of education for a term of 50 years and used by the fiscal court in the construction of a recreational complex does not constitute “school property” within the prohibition contained in this section. OAG 77-750 .

While the board of an area development district may exercise its sound and reasonable discretion in establishing criteria leading to making the selections of projects to be submitted to the Secretary of the Finance Department (now Finance and Administration Cabinet), a criterion providing that the applicant must have made a monetary contribution to the area development district organization does not represent a rational connection between the legislative purpose and the scheme of criteria and is arbitrary in violation of Ky. Const., § 2. OAG 79-181 .

Although KRS 424.260 is not mentioned in KRS 42.345 et seq., implicit in such statutes is the concept that a mandatory law applicable to procuring of personal property must be complied with. OAG 79-371 .

The phrase “road, street, bridge or highway” logically includes any road department equipment, such as a truck, to be used by that department. OAG 85-75 .

Even though subdivision (2)(c) of this section provides for the use of the area development fund for “the purchase of major items of equipment,” such equipment can only be considered in connection with equipment of an eligible “capital project.” OAG 85-75 .

Under the clear and unambiguous wording of subdivision (2)(f) of this section, the Area Development Fund money granted to counties cannot legally be expended by a fiscal court for county road department equipment or for county roads and bridges. OAG 85-75 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 13, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 13, (2) at 856.

Kentucky Law Journal.

Whiteside and Gillig, Coal and Conservation — Tax Policy, 64 Ky. L.J. 573 (1975-76).

42.355. Examination and approval of projects — Grants — Administration — Conditions.

  1. The Department for Local Government shall examine each capital project selected by the area development districts, and when it finds that a proposed project conforms to the requirements of KRS 42.350 to 42.370 ; that the estimated costs of the project are reasonable; that the costs proposed to be paid from the fund are within the amount available; and that the proposed beneficiary agency will be reasonably able to finance the operation and maintain the capital project during its estimated useful life, the commissioner of the Department for Local Government shall approve it. If the Department for Local Government determines that a capital project proposal does not conform to the requirements of KRS 42.350 to 42.370 , that the estimated costs of the project are excessive or unreasonable in light of the public benefit to be derived from the project, or the unencumbered balance in the fund available for expenditure in the area development district is insufficient to pay the costs of the project, or the part thereof proposed to be paid out of the fund, or the beneficiary agency cannot reasonably finance the operation of or maintain the capital project during its estimated useful life, the project proposal shall be disapproved by the Department for Local Government. The final decision to either approve or disapprove any project proposal shall be made no later than forty-five (45) days following official submittal of a complete proposal by the area development district, and the area development district shall be accordingly notified at that time.
  2. The commissioner of the Department for Local Government may make direct grants-in-aid of money out of the fund to any beneficiary agency for the construction or acquisition of any approved capital project. When a direct grant-in-aid has been made to a beneficiary agency, all contracts awarded for the purchase of materials, supplies, equipment, or services, except professional and technical services, required for the construction or acquisition of the project shall be awarded to the lowest and best bidder in the discretion of the beneficiary agency after public advertisement as required by KRS Chapter 424 or other applicable law. All contracts awarded under this section for the construction, reconstruction, or renovation of a building or other improvement to real estate shall be deemed contracts for public works within the meaning of KRS 341.317 and KRS Chapter 376 and other applicable statutes. All beneficiary agencies receiving a direct grant-in-aid under this subsection shall keep and maintain complete and accurate records of accounts of all expenditures of the grant moneys which shall be subject to audit by the Commonwealth for a period of five (5) years after completion of the capital project. Beneficiary agencies shall complete approved capital projects within a reasonable period of time as determined by the Department for Local Government. Upon completion of capital projects, beneficiary agencies shall submit project completion reports to the Department for Local Government as prescribed by the Department for Local Government and containing documents and information as may be necessary to determine compliance with KRS 42.350 to 42.360 and other applicable statutes and administrative regulations. Beneficiary agencies shall be liable to repay to the fund any granted funds for failure to submit full project completion reports within a reasonable period of time or for expenditure of granted funds in violation of statutes and regulations. No additional area development funds may be approved until compliance, except at the discretion of the commissioner of the Department for Local Government. Any grant moneys not required after all of the costs of the capital project have been paid by the beneficiary agency shall be promptly returned to the Commonwealth for reallocation for expenditure for other capital projects in the area development district to which the funds had been originally allocated.
  3. No capital project shall be constructed under KRS 42.350 to 42.370 except upon land to which (a) the Commonwealth, a political subdivision of the Commonwealth, or the beneficiary agency of the capital project has a good and marketable title, free of encumbrances, or (b) the beneficiary agency of the project has the right to the uninterrupted use, occupancy, and possession for a period longer than the estimated useful life of the capital project; provided nothing herein shall prohibit the construction or renovation of public buildings on land with an existing encumbrance to secure payment of funds obtained for the acquisition or improvement of said land. Each beneficiary agency shall execute and deliver to the Commonwealth its written assurances, which shall be binding on the agencies’ successors and assigns, guaranteeing that during its estimated useful life, the capital project shall be operated and maintained for public purposes and pledging that no mortgage or other encumbrances shall be placed against any capital project wholly financed out of the fund, except industrial development projects, for the breach of which assurances the Commonwealth shall have right of entry to the capital project and the beneficiary agency, or its successors and assigns, shall forthwith convey the title to the capital project to the Commonwealth. Similar assurances shall be executed and delivered to the Commonwealth by the beneficiary agencies of capital projects financed in part out of the fund and in part from other sources, except that when additional funding is derived from the issuance and sale of revenue bonds or under other statutorily authorized financing methods, to secure the repayment of which funds a statutory mortgage lien is granted in favor of any person or group of persons, the capital project may be encumbered to the extent authorized or required by the law under which the financing method was undertaken; nor shall anything in this section prohibit the encumbrance of any real property located within an industrial park or constituting an industrial site, developed or improved as a capital project under KRS 42.350 and this section, by any person, firm, company, partnership, or corporation to which the property has been conveyed, to obtain financing for the construction upon the property of industrial and commercial buildings. The written assurances provided by beneficiary agencies under this section shall be lodged for recording and recorded in the office of the county clerk of the county in which the proposed project shall be located.

History. Enact. Acts 1978, ch. 187, § 3, effective June 17, 1978; 1984, ch. 404, § 43, effective July 13, 1984; 1998, ch. 69, § 8, effective July 15, 1998; 2007, ch. 47, § 16, effective June 26, 2007; 2010, ch. 117, § 22, effective July 15, 2010.

Opinions of Attorney General.

The Department of Local Government could not approve an expenditure for purchase of two ambulances by a county where the department was unable to certify that the proposed project was an eligible capital project because the purchase was a void transaction since the provisions of KRS 424.260 were not followed. OAG 79-371 .

Subsection (4) of this section, in mentioning the bidding law of KRS Chapter 424, specifically adopts KRS 424.260 to the extent that such latter statute requires formal bidding. OAG 84-57 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 13, (1) at 856.

42.360. Rules and regulations for implementation of KRS 42.350 and 42.355.

The commissioner of the Department for Local Government shall promulgate rules and regulations governing submission and approval of proposed capital projects, the expenditure of moneys from the fund, and the designation of beneficiary agencies involved in capital projects as shall be appropriate to the implementation of KRS 42.350 and 42.355 .

History. Enact. Acts 1976, ch. 339, § 3; 1978, ch. 187, § 4, effective June 17, 1978; 1984, ch. 404, § 44, effective July 13, 1984; 1998, ch. 69, § 9, effective July 15, 1998; 2007, ch. 47, § 17, effective June 26, 2007; 2010, ch. 117, § 23, effective July 15, 2010.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 13, (1) at 856.

42.370. Amounts to be expended from fund.

  1. The maximum amount to be expended out of the area development fund for capital projects within each area development district shall be calculated on the basis of the following formula:
    1. Sixty percent (60%) of the fund is allocated for expenditure within each district in the ratio that the population of the component counties bears to the total population of the state.
    2. Twenty percent (20%) of the fund is allocated for expenditure in each district in inverse proportion to the total manufacturing employment conducted in each such district.
    3. Twenty percent (20%) of the fund is allocated for expenditure in each district in inverse proportion to the relative per capita income prevailing in each such district.
  2. Any balance remaining in the fund at the close of any fiscal year shall not lapse, but shall continue into and be available for expenditure during the next succeeding fiscal year.

History. Enact. Acts 1978, ch. 187, § 5, effective June 17, 1978.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 13, (1) at 856.

Investment and Debt Management

42.400. Office of Financial Management.

  1. The Office of Financial Management established in KRS 42.4201 shall be headed by an executive director responsible to the secretary of the Finance and Administration Cabinet, and appointed by the secretary upon approval of the Governor in accordance with the provisions of KRS 12.050 .
  2. There are included in the Office of Financial Management established in KRS 42.4201 the positions of deputy executive directors for investment and debt management, who shall be employed in the classified service as set forth inKRS Chapter 18A.

History. Enact. Acts 1980, ch. 310, § 1, effective July 15, 1980; 1990, ch. 321, § 3, effective July 13, 1990; 2000, ch. 46, § 6, effective July 14, 2000; 2005, ch. 85, § 15, effective June 20, 2005.

42.409. Definitions for KRS 42.410 and 45.760.

As used in KRS 42.410 and 45.760 , unless the context requires otherwise:

  1. “State total personal income” means the measure of all income received by or on behalf of persons in the Commonwealth, as most recently published in the Survey of Current Business by the United States Department of Commerce, Bureau of Economic Analysis.
  2. “Estimated state total personal income” means the personal income figure used by the Governor’s Office for Economic Analysis to generate final detailed revenue estimates.
  3. “Total revenues” means revenues credited to the general fund and the road fund consistent with the provisions of KRS 48.120 , as well as any restricted agency fund account from which debt service is expended.
  4. “Anticipated total revenues” means the official revenue estimates, as provided for in KRS 48.120 , projected for the general fund and the road fund, as well as any restricted agency fund account from which debt service is expended.
  5. “Available revenues” means revenues credited to the general fund and the road fund consistent with the provisions of KRS 48.120 , as well as any restricted agency fund account from which debt service is expended, minus any statutorily dedicated receipts of the respective funds.
  6. “Anticipated available revenues” means official revenue estimates, as provided for in KRS 48.120 , projected for the general fund and the road fund, as well as any restricted agency fund account from which debt service is expended, minus any statutorily dedicated receipts of the respective funds.
  7. “Total assessed value of property” means state total net assessed value of property for taxes due, as obtained from the Department of Revenue.
  8. “Per capita” means per unit of population, where population figures are the most recent available from the University of Louisville, Kentucky State Data Center.
  9. “Appropriation-supported debt service” means the amount of an appropriation identified to be expended for debt service purposes in the executive budget recommendation, and the amount of an appropriation expended for debt services in a completed fiscal year.
  10. “Appropriation-supported debt” means the outstanding principal of bonds issued by all state agencies and all individuals, agencies, authorities, boards, cabinets, commissions, corporations, or other entities of, or representing the Commonwealth with the authority to issue bonds, and for which debt service is appropriated by the General Assembly.
  11. “Nonappropriation-supported debt” means the outstanding principal of bonds issued by all state agencies and all individuals, agencies, authorities, boards, cabinets, commissions, corporations, or other entities of, or representing the Commonwealth with the authority to issue bonds, and for which debt service is not appropriated by the General Assembly.
  12. “Statutorily dedicated receipts” means revenues credited to the general fund and road fund consistent with the provisions of KRS 48.120 , as well as any restricted agency fund account, which are required by an enacted statute to be used for a specific purpose. Statutorily dedicated receipts include, but are not limited to, the following:
    1. Receipts credited to the general fund which are subject to KRS 42.450 to 42.495 , KRS 278.130 to 278.150 , or KRS 350.139 ;
    2. Receipts credited to the road fund which are subject to KRS 175.505 , KRS 177.320 , KRS 177.365 to 177.369 , KRS 177.9771 to 177.979 , KRS 186.531 , or KRS 186.535 ; and
    3. Receipts credited to a restricted agency fund account in accordance with any applicable statute.
  13. “True interest cost” means the bond yield according to issue price without a reduction for related administrative costs, and is the same figure as the arbitrage yield calculation described in the United States Tax Reform Act of 1986.

History. Enact. Acts 1990, ch. 30, § 1, effective July 13, 1990; 2000, ch. 46, § 7, effective July 14, 2000; 2004, ch. 78, § 3, effective April 6, 2004; 2005, ch. 85, § 52, effective June 20, 2005; 2009, ch. 78, § 27, effective June 25, 2009.

Compiler’s Notes.

The arbitrage yield calculation described in the U.S. Tax Reform Act, referred to in (13), may be found as 26 USCS § 148.

Legislative Research Commission Note.

(6/25/2009). As submitted by the drafter, Proposed Senate Committee Substitute to House Bill 423, which became 2009 Ky. Acts ch. 78, contained references to “KRS 48.120(2)” with “(2)” bracketed and stricken through in subsections (4) and (6) of this statute. However, during the processing of that document, the brackets and striking lines were inadvertently omitted from “(2).” This manifest clerical or typographical error has been corrected during codification by the Reviser of Statutes under the authority of KRS 7.136(1).

42.410. Duties of Office of Financial Management — Contents of state debt report.

  1. The Office of Financial Management established in KRS 42.4201 shall, subject to the provisions of KRS 41.020 to 41.375 and KRS 42.500 , have and perform functions and duties as follows:
    1. The analysis and management of short and long-term cash flow requirements;
    2. The maximization of the return on state investments given the cash flow and liquidity requirements;
    3. The coordination and monitoring of cash needs relative to investment and debt activity;
    4. The development of a long-term debt plan including criteria for the issuance of debt and an evaluation of how much total state debt is justified;
    5. The responsibility for liaison with the General Assembly on all investment and debt matters, including, but not limited to, new bond issues, the status of state debt, and the status of state investments; and
    6. All other functions of the cabinet relative to state investment and debt management including, but not limited to, the making of debt service payments, the sale of bonds, and staff assistance to the State Property and Buildings Commission, the Asset Liability Commission, and the State Investment Commission.
  2. The Office of Financial Management shall render monthly written reports concerning the performance of each investment to the State Investment Commission.
  3. The Office of Financial Management shall review state appropriation-supported bond issues for possible debt service savings through refundings as market conditions warrant.
  4. The Office of Financial Management shall submit a report within forty-five (45) days after the publication of the Comprehensive Annual Financial Report to the Legislative Research Commission, for referral to the appropriate committee, indicating the bond issues refunded, original and new interest rates, estimated savings, original and new amortization schedules, issuance costs, debt reserves, disposition of savings, and information on economic, fiscal, and market indicators of the Commonwealth’s debt position.
  5. The state debt report shall include, but not be limited to, economic, fiscal, and market indicators of debt position as set forth in this section. Indicators shall be presented in tabular and, where appropriate, graphical form. Indicators shall be presented for the fiscal year just ended and, if data is available and except as otherwise noted, for the preceding nine (9) fiscal years.
  6. Economic indicators shall include:
    1. Nonappropriation-supported debt as a percent of state total personal income;
    2. Nonappropriation-supported debt as a percent of total assessed value of property;
    3. Nonappropriation-supported debt per capita;
    4. Appropriation-supported debt as a percent of state total personal income;
    5. Appropriation-supported debt as a percent of total assessed value of property;
    6. Appropriation-supported debt per capita;
    7. Appropriation-supported debt service as a percent of total state personal income;
    8. Appropriation-supported debt service as a percent of total assessed value of property; and
    9. Appropriation-supported debt service per capita.
  7. Fiscal indicators shall be reported separately and in total for the general fund, the road fund, and each restricted fund account from which debt service is expended.
  8. Fiscal indicators shall include:
    1. Annual appropriation-supported debt service as a percent of total revenues; and
    2. Annual appropriation-supported debt service as a percent of available revenues.
  9. Market indicators shall include:
    1. The rating assigned by Moody’s Investors Services, Inc., or a comparable rating agency, to each nonappropriation-supported bond issued in the fiscal year just ended;
    2. The rating assigned by Moody’s Investors Services, Inc., or a comparable rating agency, to each appropriation-supported bond issued in the fiscal year just ended;
    3. A comparison of the difference between the true interest cost of each nonappropriation-supported bond issued and the value of a selected revenue bond index, as published by the Bond Buyer Weekly, the Delphis Hanover Corporation, or other comparable service on a date relevant to the bond issue; and
    4. A comparison of the difference between the true interest cost of each appropriation-supported bond issued and the value of a selected municipal bond index, as published by the Bond Buyer Weekly, the Delphis Hanover Corporation, or other comparable service on a date relevant to the bond issue.
  10. The state debt report shall contain a complete description of the sources of data used to prepare the report. This description shall include, but not be limited to, an enumeration, by fund and restricted fund account, of all debt, debt service, and revenue figures; the source and publication date of figures used for state total personal income, total assessed value of property, population, and selected bond indexes.
  11. If the sources of data used in a current report differ substantially from those used in the report of the preceding year, the report shall include a detailed explanation of the change. If possible, data presented in the current report for previous years shall be calculated so that, in any one (1) report, indicators for all years are calculated using consistent data categories. The use of any inconsistent data shall be noted and explained.
  12. Nothing in this section shall authorize any act inconsistent with the authority granted the State Investment Commission by KRS 42.500 and 42.525 .

History. Enact. Acts 1980, ch. 310, § 2, effective July 15, 1980; 1982, ch. 382, § 23, effective July 15, 1982; 1988, ch. 82, § 1, effective July 15, 1988; 1990, ch. 30, § 2, effective July 13, 1990; 1990, ch. 321, § 4, effective July 13, 1990; 1992, ch. 295, § 3, effective July 14, 1992; 1994, ch. 508, § 13, effective July 15, 1994; 1997 (1st Ex. Sess.), ch. 4, § 42, effective May 30, 1997; 2000, ch. 46, § 8, effective July 14, 2000; 2005, ch. 85, § 16, effective June 20, 2005.

Opinions of Attorney General.

The Kentucky Housing Corporation must submit all proposed bond issues and debt financing to the office for investment and debt management since this section and KRS 42.420 when read together, in pari materia, show that the legislative intent was to establish a centralized entity in the Finance Department (now Finance and Administration Cabinet) to evaluate, review and approve all proposed anticipation notes and bond issues of all state agencies and all agencies, commissions, corporations or other entities of or representing the Commonwealth. OAG 81-242 .

For review and approval procedures of office for Investment and Debt Management found to conform with KRS 42.420 and this section, see OAG 82-444 .

The review and approval function in the case, which involved issuance of industrial revenue bonds by Kentucky Development Finance Authority for benefit of corporation which desired to finance certain new equipment, should be restricted to these factors: (1) a determination that the proposed bonds were in reasonable conformity with the general legislative policy expressed in KRS Chapters 103 and 154; and (2) the evaluation of revenue projections relative to the proposed bond issue including a reasonable determination of the fiscal or financial soundness of the company; in a revenue bond issue of this category, the Division (now Office) of Investment and Debt Management has no authority to require by regulations a rating agency presentation, competitive bidding of all advisers, consultants, trustees, underwriters and bond counsel and a determination that the proposed bond issue has been legally authorized by and/or determined feasible in a biennial budget. OAG 83-453 .

The Office of Financial Management and Economic Analysis’ (OFMEA) lending of the Workers’ Compensation Funding Commission’s securities constitutes a violation of KRS 342.1227 based on the statutory authority for OFMEA to invest funds in repurchase agreements combined with the separate accounting and full collateralization of the Commission funds. OAG 93-13 .

The Office of Financial Management and Economic Analysis’ overnight investment of the Workers’ Compensation Funding Commission’s funds is impermissible under KRS 342.1223(2)(a). OAG 93-13 .

42.420. Proposed bond issuance subject to approval prior to issuance.

All other provisions of the Kentucky Revised Statutes notwithstanding, all state agencies and all individuals, agencies, authorities, boards, cabinets, commissions, corporations, or other entities of, or representing the Commonwealth with the authority to issue bonds, shall submit all proposed bond issues, bond anticipation notes, or interim debt financing to the Office of Financial Management for review and approval prior to issuance of such debt.

History. Enact. Acts 1980, ch. 310, § 3, effective July 15, 1980; 1990, ch. 321, § 5, effective July 13, 1990; 2000, ch. 46, § 9, effective July 14, 2000.

Opinions of Attorney General.

Cities and counties would not come under this section since a similar approval procedure is provided in KRS 66.045 and 66.310 , involving the state local finance officer and this section was not intended to be duplicative. OAG 81-242 .

The Kentucky Housing Corporation must submit all proposed bond issues and debt financing to the Office for Investment and Debt Management since KRS 42.410 and this section when read together, in pari materia, show that the legislative intent was to establish a centralized entity in the Finance Department (now Finance and Administration Cabinet) to evaluate, review and approve all proposed anticipation notes and bond issues of all state agencies and all agencies, commissions, corporations or other entities of or representing the Commonwealth. OAG 81-242 .

When this section is read together with KRS 42.410 , which stresses state debt and investments, it is clear that this section requires that all of the proposed debt issues of all central state agencies and of all individuals, commissions or corporations of or acting for the state, be reviewed and approved by the Office for Investment and Debt Management prior to issuance; thus, this section applies to all state agencies issuing revenue bonds and anticipation notes, to all debt issuing entities which issue debt in the name of the state, and to all corporations created by the state which issue revenue bonds and anticipation notes. OAG 81-242 .

For review and approval procedures of Office for Investment and Debt Management found to conform with KRS 42.410 and this section, see OAG 82-444 .

Industrial revenue bonds issued by the Kentucky Development Finance Authority require the approval of the Office for Investment and Debt Management pursuant to this section. OAG 83-131 .

Under the language of KRS 154.20-020 , the Kentucky Development Finance Authority is a “state agency” and thus under the specific and explicit language of this section, any proposed industrial revenue bonds to be issued by the Kentucky Development Finance Authority must be submitted to the Office for Investment and Debt Management for review and approval prior to the issuance of such debt. OAG 83-131 .

The review and approval function in the case, which involved issuance of industrial revenue bonds by Kentucky Development Finance Authority for benefit of corporation which desired to finance certain new equipment, should be restricted to these factors: (1) a determination that the proposed bonds were in reasonable conformity with the general legislative policy expressed in KRS Chapters 103 and 154; and (2) the evaluation of revenue projections relative to the proposed bond issue including a reasonable determination of the fiscal or financial soundness of the company; in a revenue bond issue of this category, the Division (now Office) of Investment and Debt Management has no authority to require by regulations a rating agency presentation, competitive bidding of all advisers, consultants, trustees, underwriters and bond counsel and a determination that the proposed bond issue has been legally authorized by and/or determined feasible in a biennial budget. OAG 83-453 .

42.425. Department for Facilities and Support Services — Organization — Duties.

    1. The Department for Facilities and Support Services established in the Finance and Administration Cabinet by KRS 42.014 shall be generally responsible for performance of the cabinet’s functions and duties as outlined in KRS Chapters 45, 45A, and 56 with relation to the management and administration of the State Capital Construction Program, including without limitation to the generality thereof the procurement of necessary consulting services related to capital construction and building renovation projects, construction services, and supervision of building construction projects, and for the maintenance and operation of the state government’s real property management functions and physical plant management functions. (1) (a) The Department for Facilities and Support Services established in the Finance and Administration Cabinet by KRS 42.014 shall be generally responsible for performance of the cabinet’s functions and duties as outlined in KRS Chapters 45, 45A, and 56 with relation to the management and administration of the State Capital Construction Program, including without limitation to the generality thereof the procurement of necessary consulting services related to capital construction and building renovation projects, construction services, and supervision of building construction projects, and for the maintenance and operation of the state government’s real property management functions and physical plant management functions.
    2. The department shall be headed by a commissioner appointed by the secretary of the Finance and Administration Cabinet.
    3. The department shall have the primary responsibility for developing and implementing policies applicable to all state agencies to ensure effective planning for and efficient operation of state office buildings, and shall provide appropriate assistance regarding the planning and efficient operation of all state facilities.
    4. The department shall be divided for administrative and operational purposes into:
      1. The Office of Facility Development and Efficiency, headed by an executive director appointed by the secretary in accordance with KRS 12.050 . The office shall analyze and monitor guaranteed energy savings performance contracts for state agencies. The office shall include:
        1. The Division of Engineering and Contract Administration; and
        2. The Division of Facility Efficiency;
      2. The Office of Building and Mechanical Services, headed by an executive director appointed by the secretary in accordance with KRS 12.050 . The office shall provide building and grounds maintenance, mechanical maintenance, and electronic security services to state-owned facilities across the Commonwealth and shall consist of the Division of Building Services and the Division of Mechanical Services;
      3. The Division of Real Properties;
      4. The Division of Historic Properties; and
      5. The Division of Surplus Properties.
    5. Each division shall be headed by a division director appointed by the secretary, subject to the approval of the Governor, and responsible to the commissioner of the Department for Facilities and Support Services. The commissioner shall provide for the distribution of the department’s work among the divisions within the department.
    6. The Division of Surplus Properties shall be responsible for the disposition of all personal property of the state declared surplus. The division shall be the single state agency of the Commonwealth of Kentucky that may receive, warehouse, and distribute surplus property under the Federal Property and Administrative Services Act of 1949, as amended, and any other federal law relating to the disposal of surplus federal property to the states and political subdivisions within the states. The division shall comply with federal laws and regulations in the administration of surplus property received through federal agencies. The division director may promulgate administrative regulations in accordance with KRS Chapter 13A as necessary to comply with minimum standards established by federal laws and regulations governing disposal of surplus federal property and to implement the fee or service charge provisions contained in this paragraph. The division director may establish, charge, and collect from donees of federal surplus property a fair and reasonable fee or service charge to defray the cost of operating the surplus property disposal program. The fees shall be deposited in a trust and agency account in the State Treasury to the credit of the Division of Surplus Properties.
  1. In conjunction with the responsibilities listed in subsection (1) of this section, the Department for Facilities and Support Services shall have the following duties:
    1. Establish policies to ensure efficient utilization of state property by:
      1. Requiring the development of guidelines which set forth space standards and criteria for determining the space needs of state agencies, and maintaining an inventory which tracks the agencies’ compliance with those standards and criteria; and
      2. Requiring certification of compliance, or justification for exceptions, as a criterion for approval of additional space;
    2. Establish policies to ensure effective planning for state facilities by:
      1. Developing a long-range plan for the Frankfort area, with priority on reducing dependency on leased space and encouraging the consolidation of agencies’ central offices into single locations, and shared offices for agencies with similar functions; and
      2. Developing long-range plans for housing state agencies in metropolitan areas, with priority on centralization of services and coordination of service delivery systems; and
      3. Encouraging executive branch agencies to expand long-range planning efforts, consistent with the policies of the Capital Planning Advisory Board; and
      4. Supporting long-range planning for a statewide information technology infrastructure to more efficiently deliver state government services;
    3. Establish priorities to allow least-cost financing of state facilities by:
      1. Initiating policies which authorize the state to use innovative methods to lease, purchase, or construct necessary facilities; and
      2. Requiring cost analysis to determine the most effective method of meeting space needs, with consideration for ongoing operations and initial acquisition; and
    4. Implement and maintain a comprehensive real property and facilities management database to include all state facilities and land owned or leased by the executive branch agencies, including any postsecondary institution. All state agencies and postsecondary institutions shall work cooperatively with the Department for Facilities and Support Services to implement and maintain the database.
  2. The Department for Facilities and Support Services shall develop plans for the placement of computing and communications equipment in all facilities owned or leased by state government. As part of this planning process, the department shall:
    1. Provide adequate site preparation in all state-owned facilities and require the same of those from whom the state leases space as part of the lease agreement;
    2. Fund a minimum level of site preparation for computing and communications in each new state-owned facility; and
    3. As new office sites are developed, or existing ones undergo renovation, consider the placement of shareable high-cost, high-value facilities at strategic locations throughout the state. These facilities may include video teleconference centers, optical scanning and storage services, and gateways to high-speed communication networks.

History. Enact. Acts 1978, ch. 155, § 53, effective June 17, 1978; 1982, ch. 393, § 25, effective July 15, 1982; 1992, ch. 41, § 2, effective July 14, 1992; 1994, ch. 176, § 2, effective July 15, 1994; 1998, ch. 68, § 3, effective July 15, 1998; 1998, ch. 87, § 1, effective July 15, 1998; 2002, ch. 19, § 1, effective July 15, 2002; repealed, reenact. and amend., Acts 2005, ch. 85, § 17, effective June 20, 2005; 2009, ch. 12, § 26, effective June 25, 2009.

Compiler’s Notes.

This section was formerly compiled as KRS 42.027 .

42.430. Plaque commemorating prisoners and missing soldiers in Vietnam War — Duties of Department of Veterans’ Affairs and Department for Facilities and Support Services.

  1. To honor those Kentuckians who proudly served their country during the Vietnam War but remain unaccounted for, the Department of Veterans’ Affairs shall update the plaque at the base of the Freedom Tree near the Floral Clock on the grounds of the New Capitol Annex to contain the names of Kentucky Vietnam War POW/MIAs from the most recent official accounting available from the United States Department of Defense. The plaque shall also contain a depiction of the POW/MIA flag of the National League of Families of American Prisoners of War and Missing in Southeast Asia.
  2. The Department of Veterans’ Affairs shall be responsible for the design of the new plaque required by subsection (1) of this section, and the plaque shall be paid for by the Department of Veterans’ Affairs. The Department of Veterans’ Affairs may receive appropriations, gifts, grants, federal funds, and any other funds, both public and private, to defray the cost of updating the plaque.
  3. The Department for Facilities and Support Services shall be responsible for preparing the base for the updated plaque, and for installing the plaque. The Department for Facilities and Support Services shall be reimbursed the cost of the installation by the Department of Veterans’ Affairs. The Department for Facilities and Support Services shall also be responsible for the routine maintenance of the Freedom Tree, the memorial plaque, and the grounds surrounding the tree and plaque.

History. Repealed, reenact. and amend., Acts 2005, ch. 85, § 18, effective June 20, 2005.

Compiler’s Notes.

This section was formerly compiled as KRS 42.0271 .

42.435. Plaque commemorating Kentucky Congressional Medal of Honor recipients — Duties of Department for Facilities and Support Services.

  1. To honor those who have been awarded a Congressional Medal of Honor, the United States’ highest military award for valor in combat, the Department for Facilities and Support Services shall create a plaque to contain the names of each Kentucky Congressional Medal of Honor recipient.
  2. The Department for Facilities and Support Services shall be responsible for selecting a location on the first floor of the New State Capitol for the plaque required by subsection (1) of this section. The Department for Facilities and Support Services shall also be responsible for the design, installation, and routine maintenance of the plaque. The plaque shall be updated by the Department for Facilities and Support Services within six (6) months of a Congressional Medal of Honor nomination and approval accredited to the Commonwealth of Kentucky.

History. Enact. Acts 2011, ch. 6, § 1, effective June 8, 2011.

Local Government Economic Assistance Program

42.450. Local Government Economic Assistance Fund — Sources.

  1. There is hereby established in the State Treasury a fund entitled “Local Government Economic Assistance Fund.” The fund may receive state appropriations, gifts, grants, and federal funds and shall be disbursed by the State Treasurer upon the warrant of the secretary of the Finance and Administration Cabinet. Any unallotted or unencumbered balances in the fund shall be invested pursuant to KRS 42.500 and the income earned from the investment shall be prorated for expenditure in coal producing and coal impact counties according to each county’s allocable part in the fund.
  2. Effective July 1, 1981, an amount equal to one-half (1/2) of the tax collected annually on the sale of minerals, exclusive of coal, shall be transferred from the general fund into this fund. The transfers shall be made quarterly, based upon the revenue estimates prevailing at the time each quarterly transfer is due, except that the last quarterly transfer shall be made after the close of the fiscal year accounting records, and shall be adjusted to provide the balance of the annual transfer required by this subsection.
  3. Effective October 1, 2010, the quarterly transfer of funds required by subsection (2) of this section shall be made only after the quarterly installment of the annual amount from the prior calendar year allowed as an incentive to an approved company under KRS 143A.025 and 154.27-060 has been made.

History. Enact. Acts 1980, ch. 394, § 1, effective July 1, 1980; 1986, ch. 464, § 8, effective July 15, 1986; 1992, ch. 107, § 1, effective July 1, 1992; 2010, ch. 115, § 1, effective July 15, 2010; 2010, ch. 139, § 6, effective July 15, 2010.

Legislative Research Commission Note.

(7/15/2010). This section was amended by 2010 Ky. Acts chs. 115 and 139, which do not appear to be in conflict and have been codified together.

Opinions of Attorney General.

Where KRS 42.490 transfers the coal haul road money from unencumbered fund balances under KRS 42.300 (repealed), KRS 42.330 (repealed) and KRS 177.970 (repealed) to the local government assistance fund under KRS 42.450 et seq. of a county which has no county road over which coal is being hauled, the county through the fiscal court can spend the funds on one or more of the priority categories listed under subsections 2(a) through 2(i) of KRS 42.455 including any county road under subsection 2(c) within the limits of KRS 178.010 , even though no coal is hauled over it. OAG 81-15 .

Although a county receiving moneys from the Economic Assistance Fund established under this section would appear to have statutory authorization to make expenditures from the fund to such nonprofit organizations as little league baseball pursuant to the language of subsection (2) of KRS 42.455 and 67.083(3)(f) which allow expenditures for “recreation,” such an appropriation would violate the prohibition of Ky. Const., § 179 against appropriations for corporations since the baseball program is not a county operation or function and is not under the basic operative control or management of the fiscal court. OAG 81-381 .

Penalty and interest on delinquent coal severance taxes should not be included in the calculations of the Local Government Economic Assistance Fund. OAG 84-66 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.4501. Definitions for KRS 42.450 to 42.495.

As used in KRS 42.450 to 42.495 :

  1. “Refund” means a payment of money from the State Treasury to a taxpayer, upon the authorization of the Department of Revenue following the submission of a timely request filed in accordance with applicable statutes and administrative regulations, representing all or part of an overpayment previously made by the taxpayer for a tax liability arising under KRS 143.020 or 143A.020 ; and
  2. “Severance and processing taxes on coal collected annually” means the total amount of money collected from the tax imposed by KRS 143.020 in a given fiscal year, reduced by the total amount of refunds of that tax paid during the prior fiscal year.

HISTORY: 2016 ch. 110, § 1, effective July 1, 2016.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.453. Kentucky Coal Fields Endowment Authority — Creation — Role and duties — Project eligibility criteria — Appropriation — Tax exemption.

  1. The Kentucky Coal Fields Endowment Authority is hereby created as a public corporation, governmental agency, and instrumentality of the Commonwealth, with the perpetual succession and with power in that name to:
    1. Contract and be contracted with;
    2. Acquire and convey property;
    3. Sue and be sued;
    4. Have and use a corporate seal;
    5. Adopt bylaws;
    6. Invest moneys; and
    7. Exercise, in addition to the powers and functions specifically stated in this section and KRS 42.454 all of the usual powers of private corporations to the extent that the same are not inconsistent with specifically enumerated powers or limitations upon public corporations.
  2. It shall be the role and duty of the authority to support through funding efforts to diversify the economy of the coal fields within Kentucky.
    1. Projects that may be funded shall be non-recurring investments in:
      1. Economic development;
      2. Public infrastructure, water, and wastewater;
      3. Public health and safety; and
      4. Information technology development and access.
    2. Projects shall be selected based on economic impact, job creation, workforce development, community benefit, available partnerships, project readiness, and the ability for a project to be self-sustaining.
  3. Seven million five hundred thousand dollars ($7,500,000) of the severance and processing taxes on coal collected annually shall be transferred from the general fund to the Kentucky coal fields endowment authority established in this section. The transfers shall be made in quarterly amounts of one million eight hundred seventy-five thousand dollars ($1,875,000) at the same time as the transfers to the local government economic development fund.
  4. Moneys transferred to the authority are hereby appropriated for the purposes set forth in this section and shall not be appropriated or transferred by the General Assembly for any other purpose. State moneys appropriated that are not spent at the end of the fiscal year shall not lapse.
  5. All property and income of the Kentucky coal fields endowment authority shall be exempt from all taxes and assessment of any nature.

HISTORY: 2017 ch. 164, § 1, effective June 29, 2017.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.454. Membership of Kentucky Coal Fields Endowment Authority — Terms — Disclosure of certain ownership interest — Officers — Investment options.

  1. As used in this section:
    1. “Authority” means the Kentucky coal fields endowment authority;
    2. “Board” means the chair, vice chair, and secretary-treasurer of the authority;
    3. “Chair” means the chair of the Kentucky coal fields endowment authority;
    4. “Commissioner” means the commissioner of the Department for Local Government; and
    5. “Eligible counties” means counties of the Commonwealth of Kentucky participating in the Local Government Economic Development Fund on June 29, 2017, and those that participated on January 1, 2016;
  2. The authority shall consist of seven (7) persons, who shall be selected as follows:
    1. Two (2) persons, appointed by the Governor, from counties located within the Eastern Coal Field;
    2. Two (2) persons, appointed by the Governor, from counties located within the Western Coal Field;
    3. Two (2) persons, appointed by the Governor, possessing experience and expertise in finance and investment; and
    4. The commissioner or the commissioner’s proxy.
  3. Two (2) members initially appointed to the authority shall have a term of one (1) year each, two (2) members initially appointed to the authority shall have a term of two (2) years each, and two (2) members initially appointed to the authority shall have a term of three (3) years each, except that any person appointed to fill a vacancy shall serve only for the remainder of the unexpired term. All subsequent appointments shall be for a term of three (3) years.
  4. The board members are hereby determined to be officers and agents of the Commonwealth of Kentucky and, as such, shall enjoy the same immunities from suit for the performance of their official acts as do other officers of the Commonwealth of Kentucky.
  5. If any member or officer of the authority shall be interested in, either directly or indirectly, or shall be an officer of, employee of, or have an ownership interest in any firm or corporation interested directly or indirectly in any project funded by the authority, the interest shall be disclosed clearly in the application and shall be set forth in the minutes of the authority, and the member or officer having an interest therein shall not participate in the application process.
  6. Any person appointed to the authority shall be eligible for reappointment.
  7. The members of the authority shall elect biennially from the authority’s membership the following offices: chair, vice chair, secretary-treasurer, and any assistant secretaries and assistant treasurers the authority deems necessary. The commissioner shall not be eligible to hold any of these offices.
  8. A majority of the members of the authority, determined by excluding any existing vacancies from the total number of members, shall constitute a quorum. A majority vote of the members present at a duly called meeting of the authority shall be required for the purposes of conducting its business and exercising its powers and for all other purposes.
  9. The authority shall prepare bylaws and procedures applicable to the operation of the authority and submit them to the commissioner to be promulgated as administrative regulations in accordance with KRS Chapter 13A.
  10. Members of the authority shall be entitled to reimbursement for all necessary expenses in connection with the performance of their duties.
  11. The authority shall meet twice annually and at other times upon call of the chair or a majority of the board to discuss and vote on funding for projects in eligible counties permitted to receive moneys from the authority under KRS 42.453(2).
  12. The authority may invest any and all of the assets of the fund in:
    1. Obligations and contracts for future delivery of obligations backed by the full faith and credit of the United States or a United States government agency, including but not limited to:
      1. United States Treasury;
      2. Export-Import Bank of the United States;
      3. Farmers Home Administration;
      4. Government National Mortgage Corporation; and
      5. Merchant Marine bonds;
    2. Obligations of any corporation of the United States government or government-sponsored enterprise, including but not limited to:
      1. Federal Home Loan Mortgage Corporation;
      2. Federal Farm Credit Banks;
        1. Bank for Cooperatives;
        2. Federal Intermediate Credit Banks; and
        3. Federal Land Banks;
      3. Federal Home Loan Banks;
      4. Federal National Mortgage Association; and
      5. Tennessee Valley Authority obligations;
    3. Collateralized or uncollateralized certificates of deposit, issued by banks rated in one (1) of the three (3) highest categories by a nationally recognized statistical rating organization or other interest-bearing accounts in depository institutions chartered by this state or by the United States, except for shares in mutual savings banks;
    4. Bankers acceptances for banks rated in the highest short-term category by a nationally recognized statistical rating organization;
    5. Commercial paper rated in the highest short-term category by a nationally recognized statistical rating organization;
    6. Securities issued by a state or local government, or any instrumentality or agency thereof, in the United States, and rated in one (1) of the three (3) highest long-term categories by a nationally recognized statistical rating organization;
    7. United States denominated corporate, Yankee, and Eurodollar securities, excluding corporate stocks, issued by foreign and domestic issuers, including sovereign and supranational governments, rated in one (1) of the three (3) highest long-term categories by a nationally recognized statistical rating organization;
    8. Asset-backed securities rated in the highest category by a nationally recognized statistical rating organization;
    9. Shares of mutual funds, each of which shall have the following characteristics:
      1. The mutual fund shall be an open-end diversified investment company registered under Federal Investment Company Act of 1940, as amended;
      2. The management company of the investment company shall have been in operation for at least five (5) years; and
      3. The mutual fund shall be rated in the highest category by a nationally recognized statistical rating organization; and
    10. State and local delinquent property tax claims which upon purchase shall become certificates of delinquency secured by interests in real property not to exceed twenty-five million dollars ($25,000,000) in the aggregate. For any certificates of delinquency that have been exonerated pursuant to KRS 132.220(5), the Department of Revenue shall offset the loss suffered by the Finance and Administration Cabinet against subsequent local distributions to the affected taxing districts as shown on the certificate of delinquency.

HISTORY: 2017 ch. 164, § 2, effective June 29, 2017.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.455. Local Government Economic Assistance Program — Grants for priority expenditures — Administrative regulations — Public hearings — Reports — Directory of coal road system.

  1. There is established within the Department for Local Government a Local Government Economic Assistance Program to consist of a system of grants to local governments to improve the environment for new industry and to improve the quality of life for the residents.
  2. Grants obtained under this program shall be used for priority expenditures. Thirty percent (30%) of all moneys in the fund shall be spent on the coal haul road system as described in subsection (7) of this section. The remaining seventy percent (70%) of the fund shall be spent on priority categories limited to the following, but in no event shall grants obtained under this program be used for expenses related to administration of government:
    1. Public safety, including law enforcement, fire protection, ambulance service, and other related services;
    2. Environmental protection, including sewage disposal, sanitation, solid waste, and other related programs;
    3. Public transportation, including mass transit systems, streets, and roads;
    4. Health;
    5. Recreation;
    6. Libraries and educational facilities;
    7. Social services for the poor, the elderly, and individuals with disabilities;
    8. Industrial and economic development;
    9. Vocational education;
    10. Workforce training; and
    11. Secondary wood industry development.
  3. The use of entitlement funds for repayment of debt as related to long-term bond issues is permissible as long as the revenue from the bond issues is expended on priority categories.
  4. Grants obtained under this program may be used as local portion to secure federal programs as long as program expenditures are in the priority category area. Interest earned on funds received by local units of government shall be considered available for use by the local unit of government in the priority expenditure categories.
  5. The Department for Local Government shall be responsible for the promulgation of rules and regulations necessary to implement the grants programs authorized by this section.
  6. The Department for Local Government shall assure that a public hearing is held on the expenditure of funds received under KRS 42.450 to 42.495 . Advertisement of the public hearing shall be published at least once but may be published two (2) or more times, provided that one (1) publication occurs not less than seven (7) days nor more than twenty-one (21) days before the scheduled date of the public hearing. The Department for Local Government shall submit an annual report to the Governor indicating how the grants were used and an evaluation of the program’s effectiveness in improving the economy of the units of government receiving assistance.
  7. On or before August 15, 1980, and each year thereafter, the Transportation Cabinet shall publish and furnish to the Department for Local Government a directory, including supporting maps and other documents, designating the official state coal road system in coal-impact and coal-producing counties which shall include all public highways, roads, and streets over which quantities of coal, sufficient to significantly affect the condition and state of repair of highways, roads, and streets, have been transported in the immediately preceding fiscal year. The cabinet shall further publish the total county mileage of the official state coal road system and the total ton/miles within each coal-impact and coal-producing county for said preceding fiscal year.
  8. Every person shipping or transporting coal, and every carrier for hire or common carrier hauling coal over the public highways, roads, and streets shall file with the Transportation Cabinet such information and at intervals as the cabinet shall designate by regulation duly adopted for the purpose of identifying those highways, roads, and streets comprising the coal haul road system and the quantities of coal transported thereon, in order that the cabinet can accurately calculate total ton/miles within each coal-impact and coal-producing county.
  9. The Department of Revenue shall make available to the Transportation Cabinet coal severance and processing tax data for use in verifying and supplementing the information furnished under the provisions of subsection (8) of this section. The information shall be furnished in such a manner as to conceal the identity of individual taxpayers; if the data cannot be furnished without revealing the identity of individual taxpayers, it shall be withheld.

History. Enact. Acts 1980, ch. 394, § 2, effective July 1, 1980; 1982, ch. 393, § 29, effective July 15, 1982; 1986, ch. 374, § 5, effective July 15, 1986; 1990, ch. 50, § 1, effective July 13, 1990; 1992, ch. 107, § 2, effective July 1, 1992; 1994, ch. 18, § 1, effective July 15, 1994; 1994, ch. 224, § 17, effective July 15, 1994; 1994, ch. 405, § 8, effective July 15, 1994; 1998, ch. 69, § 10, effective July 15, 1998, 2005, ch. 85, § 53, effective June 20, 2005; 2007, ch. 47, § 18, effective June 26, 2007; 2010, ch. 117, § 24, effective July 15, 2010.

Opinions of Attorney General.

Where KRS 42.490 transfers the coal haul road money from unencumbered fund balances under KRS 42.300 (repealed), KRS 42.330 (repealed) and KRS 177.970 (repealed) to the local government assistance fund under KRS 42.450 et seq. of a county which has no county road over which coal is being hauled, the county through the fiscal court can spend the funds on one or more of the priority categories listed under subsections 2(a) through 2(i) of this section including any county road under subsection 2(c) within the limits of KRS 178.010 , even though no coal is hauled over it. OAG 81-15 .

Although a county receiving moneys from the Economic Assistance Fund established under KRS 42.450 would appear to have statutory authorization to make expenditures from the fund to such nonprofit organizations as little league baseball pursuant to the language of subsection (2) of this section and 67.083(3)(f) which allow expenditures for “recreation”, such an appropriation would violate the prohibition of Ky. Const., § 179 against appropriations for corporations since the baseball program is not a county operation or function and is not under the basic operative control or management of the fiscal court. OAG 81-381 .

Future receipts of county coal severance funds could not be obligated by a fiscal court beyond its present term of office for the future construction of a high school pursuant to subsection (1)(f) of this section; a fiscal court cannot, due to the restrictions of Ky. Const., § 157, create county obligations in any year which would be in excess of the county’s income and revenue for that particular year without a vote of the people. OAG 81-408 .

A fiscal court in a county affected by the local government economic assistance program has no authority to enact an ordinance requiring all coal transporters to file the form TD 59-100 (Coal Severor and/or Route and Tonnage Report) with the transportation cabinet, or an ordinance requiring similar reports to be filed with the fiscal court. There is no statute expressly granting counties the authority to enact ordinances in this kind of situation, neither is there any necessary implication of such authority; moreover, the nature of the state legislation is such that it can be seen clearly as a state-preempted financial program of assistance to local governments. OAG 83-77 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 11, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.4582. Local government economic development fund — Adjustment for quarterly transfers — Schedule of transfers from general fund.

  1. There is hereby established in the State Treasury a fund entitled “Local Government Economic Development Fund.” The fund may receive state appropriations, gifts, grants, and federal funds and shall be disbursed by the State Treasurer upon the warrant of the secretary of the Finance and Administration Cabinet. Any unallotted or unencumbered balances in the fund shall be invested as provided for in KRS 42.500(9). Income earned from the investments shall be prorated for grants to counties according to the allotment schedule set out in KRS 42.4592 .
    1. Moneys shall be transferred from the general fund in an amount equal to fifty percent (50%) of the severance and processing taxes on coal collected annually, unless otherwise amended by the budget bill. (2) (a) Moneys shall be transferred from the general fund in an amount equal to fifty percent (50%) of the severance and processing taxes on coal collected annually, unless otherwise amended by the budget bill.
    2. The transfers shall be made quarterly, based upon the revenue estimates prevailing at the time each quarterly transfer is due. Each quarterly transfer shall be adjusted to account for refunds by determining the total amount of refunds paid in the prior fiscal year, dividing that amount by four (4), and reducing each transfer by this amount. The last quarterly transfer shall be made after the close of the fiscal year accounting records, and shall be adjusted to provide the balance of the annual transfer required by this subsection.
    3. The quarterly calculation and transfer of funds pursuant to this section shall be made only after distribution of the quarterly installment of the annual amount from the prior calendar year allowed as an incentive to an approved company under KRS 143.024 and 154.27-060 .

History. Enact. Acts 1992, ch. 107, § 4, effective July 1, 1992; 1996, ch. 101, § 3, effective July 15, 1996; 1996 (1st Ex. Sess.), ch. 1, § 76, effective December 12, 1996; 2007 (2nd Ex. Sess.), ch. 1, § 15, effective August 30, 2007; 2012, ch. 110, § 13, effective April 11, 2012; 2016 ch. 110, § 2, effective July 1, 2016.

Legislative Research Commission Notes.

(7/15/96). The reference to KRS 45.4592 at the end of subsection (1) of this statute has been corrected to read KRS 42.4592 , remedying an inadvertent misnumbering in codification. See 1992 Ky. Acts ch. 107, secs. 4 and 7.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. V, A, 1 at 939.

42.4585. Transfers from local government economic development fund to local government economic assistance fund — Schedule of transfers.

  1. A portion of each quarterly transfer of moneys provided for in KRS 42.4582 shall be transferred from the local government economic development fund into the local government economic assistance fund.
  2. The amount transferred annually from the local government economic development fund into the local government economic assistance fund under the provisions of subsection (1) of this section shall be not less than an amount equal to fifteen percent (15%) of the severance and processing taxes on coal collected annually.
  3. The quarterly calculation and transfer of funds pursuant to subsections (1) and (2) of this section shall be made only after distribution of the quarterly installment of the annual amount from the prior calendar year allowed as an incentive to an approved company under KRS 143.024 and 154.27-060 .

History. Enact. Acts 1992, ch. 107, § 5, effective July 1, 1992; 1996 (1st Ex. Sess.), ch. 1, § 77, effective December 12, 1996; 2002, ch. 338, § 2, effective July 15, 2002; 2007 (2nd Ex. Sess.), ch. 1, § 16, effective August 30, 2007; 2012, ch. 110, § 14, effective April 11, 2012.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.4586. Transfers from local government economic development fund to secondary wood products development fund. [Repealed.]

Compiler's Notes.

This section (Enact. Acts 1994, ch. 224, § 15, effective July 15, 1994) was repealed by Acts 2013, ch. 49, § 10 effective June 25, 2013.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.4588. Local Government Economic Development Program — Use of grants — Procedures.

    1. A Local Government Economic Development Program is established to consist of a system of grants to counties to attract new industry. Grants from funds provided for in KRS 42.4592(1)(a) and (b) shall be administered by the Department for Local Government. Grants from funds provided for in KRS 42.4592(1)(c) shall be administered by the Kentucky Economic Development Finance Authority. (1) (a) A Local Government Economic Development Program is established to consist of a system of grants to counties to attract new industry. Grants from funds provided for in KRS 42.4592(1)(a) and (b) shall be administered by the Department for Local Government. Grants from funds provided for in KRS 42.4592(1)(c) shall be administered by the Kentucky Economic Development Finance Authority.
    2. All references in this section to the commissioner of the Department for Local Government relate only to the grants or industrial development projects funded through KRS 42.4592(1)(a) and (b). All references in this section to the secretary of the Cabinet for Economic Development or the Kentucky Economic Development Finance Authority relate only to grants or industrial development projects funded through KRS 42.4592(1)(c).
  1. Grants obtained under this program shall be used for:
    1. Industrial development projects if an industrial firm has agreed with the local government, to the satisfaction of the Kentucky Economic Development Finance Authority or the Department for Local Government, to develop, in conjunction with the industrial development project, manufacturing, processing, assembling, or other facilities approved by the secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government;
    2. Industrial development projects if the secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government finds that the project is necessary for the creation of an environment for new industry in order to obtain an agreement from an industrial firm to develop manufacturing, processing, assembling, or other facilities approved by the secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government; and
    3. Debt service for industrial development projects, as defined in subsection (2)(a) and (b) of this section, or for facilities approved by the secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government under the provisions of subsection (3) of this section.
  2. The secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government may approve facilities, other than manufacturing, processing, or assembling facilities, for industrial development projects when the secretary or the commissioner finds that the facility will add value to a product. Value-added facilities shall include data processing, telecommunication, and distribution facilities but shall not include retail facilities or coal mining, coal processing, or coal transportation facilities. The secretary or the commissioner may also approve privately owned facilities for transient lodging and recreation where the secretary or commissioner finds that the cost of the recreation component of the facility is equal to, or greater than, the cost of the lodging component of the facility. The criteria for approval of applications for grants provided for in subsection (10)(a), (b), and (c) of this section shall be paramount in the case of lodging and recreational facilities.
  3. Applications for grants from funds provided for in KRS 42.4592(1)(a) and (b) shall be made by the legislative bodies of one (1) or more counties with accounts in the local government economic development fund. Applications for grants from funds provided for in KRS 42.4592(1)(c) shall be made by the legislative bodies of two (2) or more counties with accounts in the local government economic development fund. No grant shall be awarded without application for a grant.
  4. A grant may be awarded for an industrial development project located in a county that does not have an account in the local government economic development fund, if the secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government finds that the industrial development project may be reasonably expected to create jobs for residents of the local unit or units of government applying for the grant. Application for the grant shall be made by the legislative bodies of one (1) or more counties with accounts in the local government economic development fund.
  5. An industrial development project may include legal, accounting, engineering, and marketing expenses for a regional industrial park, in addition to the activities set forth in subsection (11)(a) of this section.
  6. Grants awarded from funds provided for in KRS 42.4592(1)(a) and (b) shall not exceed the total balance of the accounts of the applicant counties at the time of the award of the grant.
  7. Grants awarded under the provisions of subsection (2)(c) of this section may be for a period not to exceed the current biennium of the Commonwealth and shall be limited to an amount not to exceed the amount estimated to be allocated to the applicant county or counties for the current biennium under the provisions of KRS 42.4592(1)(a) and (b).
  8. Approval of grant applications shall be by the secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government. Award of grants from funds provided for in KRS 42.4592(1)(c) shall be by the Kentucky Economic Development Finance Authority. Award of grants from funds provided for in KRS 42.4592(1)(a) and (b) shall be by the commissioner of the Department for Local Government.
  9. Criteria for approval of applications and the award of grants to be considered, if applicable, shall include:
    1. The number of jobs to be created or preserved, directly or indirectly, by the industrial development project;
    2. Payrolls, and the taxes generated, both at the state and local levels, by the industrial development project and taxes generated by the employment created or preserved by the industrial development project;
    3. The size, nature, and cost of the industrial development project, including the prospect of the industrial development project providing long-term jobs in enterprises consistent with the changing economies of the affected local units of government;
    4. The needs, and degree of needs, of the local units of government which will be affected by the industrial development project;
    5. The needs of any industrial firm benefiting from the industrial development project;
    6. The amount and kind of assistance, if any, available to an industrial firm from other government agencies through tax exemption or abatement, financing assistance through industrial development bonds, and otherwise, with respect to the industrial development project;
    7. The amount of capital made available to the facility by lenders and by the industrial firm; and
    8. The economic feasibility of the facility.
  10. For purposes of this section:
    1. “Industrial development project” includes the acquisition of any real estate and the construction, acquisition, and installation thereon and with respect thereto of improvements and facilities necessary and useful for the improvement of the real estate for conveyance to or lease to industrial firms to be used for manufacturing, processing, or assembling purposes, including surveys; site tests and inspections; subsurface site work; excavation, removal of structures, roadways, cemeteries, and other surface obstructions; filling, grading, and provision of drainage; storm water retention; installation of utilities, such as water, sewer, sewage treatment, gas, electricity, communication, and other similar facilities; off-site construction of utility extensions to the boundaries of the real estate; construction and installation on the real estate of the industrial firm of buildings, including buildings to be used for worker training and education; rail facilities; roads; sidewalks; curbs; other improvements to the real estate necessary to its manufacturing, processing, assembling, or other approved use by industrial entities; workforce training; and job development incentive grants;
    2. “Industrial firm” means any corporation, limited liability company, limited liability partnership, partnership, person, or other legal entity, whether domestic or foreign, which will itself or through its subsidiaries and affiliates construct and develop a manufacturing, processing, assembling, or other approved facility on the site of an industrial development project financed pursuant to this section;
    3. “Job development incentive grant” means an award to a county of funds from its account administered by the Department for Local Government pursuant to KRS 42.4592(1)(a) and (b) for the use by the county to encourage job development for those industrial development projects located in that county which create at least twenty-five (25) new full-time jobs held by Kentucky residents who receive a minimum wage of at least one hundred thirty percent (130%) of the federal minimum wage. Each job development incentive grant shall be limited to five thousand dollars ($5,000) for each job created which fulfills the requirements of this subsection. The industrial firm receiving the job development incentive grant shall pay its employees at the project site an average wage equal to or greater than one hundred fifty percent (150%) of the federal minimum wage and shall invest at least ten thousand dollars ($10,000) per new job created. After a fiscal court has received authorization for the job development grant by the Department for Local Government, the county, the industrial firm, and the Department for Local Government shall enter into an agreement committing the grant funds to be disbursed at such time as the industrial firm certifies the authenticity of the following information to be delivered to the county:
      1. The industrial firm has made at least the minimum investment required;
      2. At least twenty-five (25) new full-time Kentucky jobs have been created at the project site by the industrial firm;
      3. No employee at the project site is paid a salary by the industrial firm which is less than one hundred thirty percent (130%) of the federal minimum wage;
      4. The employees at the project site are paid an average wage by the industrial firm at least equal to one hundred fifty percent (150%) of the federal minimum wage;
      5. Each employee hired for the project by the industrial firm shall have worked on a full-time basis at the minimum wages described in this section at least twelve (12) full consecutive months at the site prior to any grant funds disbursement; and
      6. No job created by the industrial firm after twenty-four (24) months from the date of the first eligible hire at the project site shall be considered for the grant.

        If the county is satisfied the information provided is accurate and qualifies the industrial firm for the job development incentive grant as described in the agreement, it shall forward the certified information to the Department for Local Government, which shall make the job development grant disbursement upon sufficient evidence that all terms of the agreement have been met; and

    4. “Regional industrial park” means an industrial development project authorized for a grant award by the Kentucky Economic Development Finance Authority for a minimum of three (3) counties eligible for grant funds provided for in KRS 42.4592(1)(c), which coalition may include a county as approved under subsection (5) of this section.
  11. Findings by the secretary of the Cabinet for Economic Development or the commissioner of the Department for Local Government, provided for in subsections (2)(b), (3), and (5) of this section, shall be made in writing to the affected counties, the Governor, and the Legislative Research Commission.
  12. By October 1 of each odd-numbered year, the secretary of the Cabinet for Economic Development and the commissioner of the Department for Local Government shall each provide, in writing, to the Governor and the Legislative Research Commission a listing of all applications for grants received pursuant to this section subsequent to the last report, indicating which applications were approved or disapproved, with the reason for disapproval when the decision was to disapprove, and a listing of all grants awarded, with the amount of the award, the recipient county, and the related industrial development project.
    1. Projects specifically authorized by appropriations made by the General Assembly in an enacted budget bill, with the funding source identified as funds allocated to individual counties under KRS 42.4592(1)(a) or (b), shall be deemed approved and shall not be subject to the application process established in this section. (14) (a) Projects specifically authorized by appropriations made by the General Assembly in an enacted budget bill, with the funding source identified as funds allocated to individual counties under KRS 42.4592(1)(a) or (b), shall be deemed approved and shall not be subject to the application process established in this section.
    2. Projects described in paragraph (a) of this subsection shall be subject to a memorandum of agreement between the entity identified in the appropriation and the Department for Local Government. The memorandum of agreement shall address the legal requirements for the disbursement and accounting of funds.
    3. Within thirty (30) days of the receipt of a written request from an entity designated in the appropriation for funding related to a project described in paragraph (a) of this subsection, the Department for Local Government shall prepare and send a memorandum of agreement to the designated entity for review and signature. Upon receipt of the signed memorandum of agreement from the designated entity, the Department for Local Government shall release the funds for the project for use by the designated entity.
    4. Funds appropriated for specific projects as described in paragraph (a) of this subsection shall not be expended for any other purpose, provided that the commissioner of the Department for Local Government may, upon written request by a designated entity identifying an extraordinary circumstance or emergency situation, approve the reallocation of funds appropriated for a specific project as described in paragraph (a) of this subsection to the extent necessary to address the extraordinary circumstance or emergency situation. Any approval under this paragraph shall be made in writing, and shall be reported to the State Budget Director and the Interim Joint Committee on Appropriations and Revenue within thirty (30) days of the approval being made.

History. Enact. Acts 1992, ch. 107, § 6, effective July 1, 1992; 1994, ch. 18, § 2, effective July 15, 1994; 1994, ch. 499, § 6, effective July 15, 1994; 1996, ch. 194, § 1, effective July 15, 1996; 1998, ch. 170, § 2, effective July 15, 1998; 2000, ch. 300, § 1, effective July 14, 2000; 2001, ch. 34, § 2, effective June 21, 2001; 2002, ch. 338, § 1, effective July 15, 2002; 2006, ch. 210, § 2, effective July 12, 2006; 2007, ch. 47, § 19, effective June 26, 2007; 2008, ch. 123, § 1, effective July 15, 2008; 2010, ch. 117, § 25, effective July 15, 2010.

Legislative Research Commission Notes.

(7/15/2008). 2008 Ky. Acts chs. 123, sec. 2 provides that amendments made to this section by that Act “shall apply to projects beginning with those authorized in the 2008-2010 biennial budget.”

(6/21/2001). A reference to “subsection (9)” in subsection (3) of this statute has been changed in codification to “subsection (10)” under KRS 7.136(1)(e) and (h). In 2000 Ky. Acts ch. 300, sec. 1, the existing subsection (9) was renumbered as subection (10), but an internal reference to that subsection in the existing language of this statute was overlooked.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.4592. Allocation of remaining moneys in local government economic development fund.

  1. Moneys remaining in the local government economic development fund following the transfer of moneys to the local government economic assistance fund provided for in KRS 42.4585 shall be allocated as follows:
    1. Thirty-three and one-third percent (33-1/3%) shall be allocated to each coal producing county on the basis of the ratio of total coal severed in the current and preceding four (4) years in each respective county to the total coal severed statewide in the current and four (4) preceding years;
    2. Thirty-three and one-third percent (33-1/3%) shall be allocated quarterly to each coal-producing county on the basis of the following factors, which shall be computed for the current and four (4) preceding years, and which shall be equally weighted:
      1. Percentage of employment in mining in relation to total employment in the respective county;
      2. Percentage of earnings from mining in relation to total earnings in the respective county; and
      3. Surplus labor rate; and
    3. Thirty-three and one-third percent (33-1/3%) shall be reserved for expenditure for industrial development projects benefiting two (2) or more coal-producing counties. For purposes of this paragraph, “coal-producing county” shall mean a county which has produced coal in the current or any one of the four (4) preceding years.
    1. For purposes of paragraph (b) of subsection (1) of this section, “percentage of employment in mining” and “percentage of earnings from mining” shall be provided by the Department of Workforce Investment in the Education and Workforce Development Cabinet, and “surplus labor rate” shall be the rate published for the latest available five (5) year period by the Department of Workforce Investment as provided in paragraph (b) of this subsection. (2) (a) For purposes of paragraph (b) of subsection (1) of this section, “percentage of employment in mining” and “percentage of earnings from mining” shall be provided by the Department of Workforce Investment in the Education and Workforce Development Cabinet, and “surplus labor rate” shall be the rate published for the latest available five (5) year period by the Department of Workforce Investment as provided in paragraph (b) of this subsection.
      1. Each year the Department of Workforce Investment shall estimate surplus labor for each county and for the Commonwealth and shall annually publish an estimate of the surplus labor rate for each county and the Commonwealth. (b) 1. Each year the Department of Workforce Investment shall estimate surplus labor for each county and for the Commonwealth and shall annually publish an estimate of the surplus labor rate for each county and the Commonwealth.
      2. The estimate of surplus labor for each county and for the Commonwealth shall be made using the best practical method available at the time the estimates are made. In determining the method to be adopted, the Department of Workforce Investment may consult with knowledgeable individuals, including but not limited to the Office of the United States Bureau of Labor Statistics, state and national researchers, state and local officials, and staff of the Legislative Research Commission. The description of the method used to estimate surplus labor shall be reported in each annual publication provided for in subparagraph 1. of this paragraph.
      3. For purposes of this section, “surplus labor” means the total number of residents who can be classified as unemployed or as discouraged workers, and “surplus labor rate” means the percentage of the potential civilian labor force which is surplus labor.
  2. The funds allocated under the provisions of paragraphs (a) and (b) of subsection (1) of this section shall retain their identity with respect to the county to which they are attributable, and a separate accounting of available moneys within the fund shall be maintained for the respective counties. Accounting for funds allocated under the provisions of this section shall be by the Department for Local Government.

History. Enact. Acts 1992, ch. 107, § 7, effective July 1, 1992; 1994, ch. 224, § 16, effective July 15, 1994; 1996, ch. 271, § 4, effective July 15, 1996; 1998, ch. 69, § 11, effective July 15, 1998; 2006, ch. 211, § 10, effective July 12, 2006; 2007, ch. 47, § 20, effective June 26, 2007; 2009, ch. 11, § 8, effective June 25, 2009; 2010, ch. 117, § 26, effective July 15, 2010; 2013, ch. 49, § 1, effective June 25, 2013; 2016 ch. 110, § 3, effective July 1, 2016; 2019 ch. 146, § 5, effective June 27, 2019.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (3) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. V, A, 1 at 939.

42.4595. Authority for administrative regulations.

The Department for Local Government may promulgate administrative regulations to implement the provisions of KRS 42.4582 , 42.4585 , 42.4592 , and KRS 42.4588 as it relates to KRS 42.4592 (1)(a) and (b). The Cabinet for Economic Development or the Kentucky Economic Development Finance Authority may promulgate administrative regulations to implement the provisions of KRS 42.4588 as it relates to KRS 42.4592(1)(c).

History. Enact. Acts 1992, ch. 107, § 8, effective July 1, 1992; 1994, ch. 499, § 7, effective July 15, 1994; 1998, ch. 69, § 12, effective July 15, 1998; 2001, ch. 34, § 3, effective June 21, 2001; 2002, ch. 338, § 45, effective July 15, 2002; 2006, ch. 210, § 3, effective July 12, 2006; 2007, ch. 47, § 21, effective June 26, 2007; 2010, ch. 117, § 27, effective July 15, 2010.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.460. Independent annual audit and certification of compliance — Exception.

Except as provided in KRS 91A.040(7)(b), any assistance granted under KRS 42.450 to 42.495 shall include an agreement that an independent annual audit shall be conducted and that the audit report shall include a certification that the funds were expended for the purpose intended. A copy of the audit and certification of compliance shall be forwarded to the Department for Local Government, in the case of assistance granted from the local government economic assistance fund or the local government economic development fund as allocated in KRS 42.4592(1)(a) and (b), or to the Cabinet for Economic Development and the Kentucky Economic Development Finance Authority, in the case of assistance granted from the local government economic development fund, within eighteen (18) months after the end of the fiscal year.

History. Enact. Acts 1980, ch. 394, § 3, effective July 1, 1980; 1982, ch. 393, § 30, effective July 15, 1982; 1986, ch. 374, § 6, effective July 15, 1986; 1990, ch. 52, § 4, effective July 13, 1990; 1992, ch. 107, § 9, effective July 1, 1992; 1994, ch. 499, § 8, effective July 15, 1994; 1998, ch. 69, § 13, effective July 15, 1998; 2001, ch. 34, § 4, effective June 21, 2001; 2002, ch. 338, § 46, effective July 15, 2002; 2006, ch. 210, § 4, effective July 12, 2006; 2007, ch. 47, § 22, effective June 26, 2007; 2010, ch. 117, § 28, effective July 15, 2010; 2018 ch. 10, § 3, effective July 14, 2018; 2019 ch. 91, § 3, effective June 27, 2019.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.465. Approval of assistance.

No assistance shall be approved in excess of funds received and transferred to the account of any respective unit of government, and no assistance shall be approved for a unit of government failing to submit the certification of compliance required in KRS 42.460 .

History. Enact. Acts 1980, ch. 394, § 4, effective July 1, 1980.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.470. Allocation of funds among counties — Limitation of reduction of funds to counties and their incorporated areas.

Moneys in the local government economic assistance fund shall be allocated among the counties as follows:

  1. Funds allocated under KRS 42.4585 :
    1. Sixty percent (60%) shall be distributed to each coal producing county on the basis of the ratio of coal severed in each respective county to the coal severed statewide.
    2. Thirty percent (30%) shall be distributed to each coal producing county on the basis of per capita income (inverse order), ton miles of resource roads and population, equally weighted.
    3. Ten percent (10%) shall be distributed to non-coal producing counties impacted by the transport of coal on the basis of geographic area, ton miles of resource roads, and per capita income (inverse order), weighted on a basis of 30/100, 40/100, and 30/100, respectively. The expenditure of such funds shall be limited to the categories of projects set out in KRS 42.455(2)(c). All counties shall receive an annual payment based on the average of total ton miles within the county during the most recent three (3) year period. To qualify for the funds distributed under the provisions of this paragraph, a county must have within its geographic boundaries in any single year twenty-five hundredths of one percent (0.25%) of the total ton miles within coal impact counties during the most recent three (3) year period.
    1. All funds allocated under KRS 42.450(2) shall be distributed among the mineral producing counties on the basis of the tax collected on minerals severed in each respective county. (2) (a) All funds allocated under KRS 42.450(2) shall be distributed among the mineral producing counties on the basis of the tax collected on minerals severed in each respective county.
    2. In no event shall the amount of funds distributed to a mineral producing county, and to the incorporated areas within that county under KRS 42.475 , in any given quarter be reduced by greater than fifty percent (50%) as a result of any refund of the tax imposed on the severance and processing of minerals. If a refund of tax occurs and a county’s allocated share of the refund amount is greater than fifty percent (50%) of the quarterly distribution due that county and its incorporated areas, the remainder shall carry forward to be offset in successive quarters as necessary until it is satisfied in full.

History. Enact. Acts 1980, ch. 394, § 5, effective July 1, 1980; 1992, ch. 107, § 3, effective July 1, 1992; 1994, ch. 488, § 4, effective July 15, 1994; 2016 ch. 110, § 4, effective July 1, 2016.

NOTES TO DECISIONS

1.County in Which Tax Collected.

Since “severance” of coal means the parting of the coal from the earth in which it has been imbedded, the county in which underground seams of coal were located was entitled to an allocation portion of the state severance tax collections rather than the county in which mouths of mines through which the same coal was brought to the surface were located. Clay County v. Leslie County, 531 S.W.2d 524, 1975 Ky. LEXIS 47 ( Ky. 1975 ) (decided under prior law).

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 11, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.472. Use of tar sands moneys by counties.

Moneys from tar sands distributed to counties under KRS 42.470(2) shall be used for economic development purposes as approved by the Department for Local Government.

History. Enact. Acts 2002, ch. 367, § 3, effective July 15, 2002; 2007, ch. 47, § 23, effective June 26, 2007; 2010, ch. 117, § 29, effective July 15, 2010.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.475. Allocation of funds to incorporated areas — Allocation to counties.

  1. Except as provided in subsection (2) of this section, ten percent (10%) of the funds allocated to each county under the provisions of KRS 42.470 shall be allotted to the incorporated areas within the county based on the ratio that the population of each incorporated area bears to the total population of all the incorporated areas within the county; except that incorporated areas shall not be eligible for funds allocated to counties under the provisions of KRS 42.490 and 1980 Acts, ch. 394, sec. 11.
  2. If the amount of funds to be allotted to an incorporated area under subsection (1) of this section is less than twenty-five dollars ($25) in any given quarter, then the allotment shall not be made and the applicable funds shall instead be distributed to the county to which they were allocated under KRS 42.470 .

History. Enact. Acts 1980, ch. 394, § 6, effective July 1, 1980; 2016 ch. 110, § 5, effective July 1, 2016.

Compiler's Notes.

Acts 1980, ch. 394, § 11, referred to herein, contained an appropriation for the fiscal year 1979-80.

Opinions of Attorney General.

In applying the program to incorporated areas under this section the state is only required to determine whether the applicant exists as an incorporated city; it is not its duty to determine precisely what municipal functions are being carried on. The statute must be accepted and applied as it is written. OAG 82-558 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.480. Estimate of funds to be allocated — Remittance of funds.

  1. On or before July 1, 1992, and each year thereafter, the commissioner of the Department for Local Government shall provide the Cabinet for Economic Development, the Kentucky Economic Development Finance Authority, and the legislative body of each local government eligible for funds under the provisions of KRS 42.450 to 42.495 , an estimate of the funds that will be allocated to the local government for fiscal year 1992-93, and each year thereafter.
  2. On or before the fifteenth of the first month of a quarter, the commissioner of the Department for Local Government shall cause to be remitted to the legislative bodies of the local governments eligible for funds from the local government economic assistance fund, the funds allocated to the respective local governments for the prior quarter; except that the remittance for the last quarter of a fiscal year shall be made after the close of the fiscal year accounting records and shall be adjusted to provide the balance of the annual allocation due the local government.

History. Enact. Acts 1980, ch. 394, § 7, effective July 1, 1980; 1986, ch. 374, § 7, effective July 15, 1986; 1992, ch. 107, § 10, effective July 1, 1992; 1994, ch. 499, § 9, effective July 15, 1994; 1998, ch. 69, § 14, effective July 15, 1998; 2001, ch. 34, § 5, effective June 21, 2001; 2002, ch. 338, § 47, effective July 15, 2002; 2007, ch. 47, § 24, effective June 26, 2007; 2010, ch. 117, § 30, effective July 15, 2010.

Opinions of Attorney General.

Under the literal wording of this section, the allocating process of the Finance and Administration Cabinet cannot be properly and fairly applied except in terms of the cities actually in existence and eligible on or before July 1, 1981, or on or before July 1 of each year thereafter; thus the inevitable starting point in the whole program of allocation is the estimate of allocation to then existing eligible local governments. In this manner the actual schedule of payment to eligible local governments, under subsection (2) of this section, must be followed. OAG 82-558 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.485. Funds not to lapse.

Moneys in the local government economic assistance fund are hereby appropriated, and shall be treated as a continuing appropriation and shall not lapse at the end of the fiscal year.

History. Enact. Acts 1980, ch. 394, § 8, effective July 1, 1980.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

42.490. Transfer of fund balances of county.

All unencumbered fund balances in each county’s account established under KRS 42.300 , and all unencumbered fund balances in each county’s account established under KRS 42.330 , and all unencumbered fund balances in each county’s account established under KRS 177.970 , shall be transferred to that county’s account established to implement the provisions of KRS 42.450 to 42.495 . Funds transferred may be used for those purposes authorized by KRS 42.450 to 42.495 .

History. Enact. Acts 1980, ch. 394, § 9, effective July 1, 1980.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

Opinions of Attorney General.

Where this section transfers the coal haul road money from unencumbered fund balances under KRS 42.300 (repealed), KRS 42.330 (repealed) and KRS 177.970 (repealed) to the local government assistance fund under KRS 42.450 et seq. of a county which has no county road over which coal is being hauled, the county through the fiscal court can spend the funds on one or more of the priority categories listed under subsections 2(a) through 2(i) of KRS 42.455 including any county road under subsection 2(c) within the limits of KRS 178.010 , even though no coal is hauled over it. OAG 81-15 .

42.495. Effect of reduction of local general tax effort.

  1. If a qualifying local government unit reduces its general tax effort for any fiscal year, below the level of fiscal year 1991-92, that governmental unit shall forfeit funds that would otherwise be available under the provisions of KRS 42.450 to 42.495 on a dollar-for-dollar basis.
  2. For purposes of this section, “general tax effort” shall mean the total revenues raised in fiscal year 1991-92 from the levy of all of the taxing district’s taxes in fiscal year 1991-92. Taxes based upon the 1991 assessment of property shall be considered to be taxes levied and collected for fiscal year 1991-92.

History. Enact. Acts 1980, ch. 394, § 10, effective July 1, 1980; 1992, ch. 107, § 11, effective July 1, 1992.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (1) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (2) at 856.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 12, (4) at 856.

Opinions of Attorney General.

The forfeiture of funds mentioned in this section can only apply to an eligible city which has exercised the General Assembly’s direction in KRS 92.280 and has engaged in a general tax effort, as defined in KRS 42.495(2). OAG 82-558 .

Considering the literal wording of this section, any city incorporated as such after the fiscal year of 1979-80 and thus not having a general tax effort, as called for in the statute, does not come within the operative effect of the statute. OAG 82-558 .

Investment Commission

42.500. State Investment Commission — Powers.

  1. There shall be a State Investment Commission composed of:
    1. The State Treasurer who shall be chairman;
    2. The secretary of the Finance and Administration Cabinet;
    3. The state controller; and
    4. Two (2) persons appointed by the Governor.
  2. The individuals appointed by the Governor shall be selected as follows: one (1) to be selected from a list of five (5) submitted to the Governor by the Kentucky Bankers Association, and one (1) to be selected from a list of five (5) submitted to the Governor by the Independent Community Bankers Association.
  3. The State Investment Commission shall meet at least quarterly to review investment performance and conduct other business. This provision shall not prohibit the commission from meeting more frequently as the need arises.
  4. The State Treasurer and secretary of the Finance and Administration Cabinet shall each have the authority to designate, by an instrument in writing over his or her signature and filed with the secretary of the commission as a public record of the commission, an alternate with full authority to:
    1. Attend in the member’s absence, for any reason, any properly convened meeting of the commission; and
    2. Participate in the consideration of, and vote upon, business and transactions of the commission.

      Each alternate shall be a person on the staff of the appointing member or in the employ of the appointing member’s state agency or department.

  5. Any designation of an alternate may, at the appointing member’s direction:
    1. Be limited upon the face of the appointing instrument to be effective for only a specific meeting or specified business;
    2. Be shown on the face of the appointing instrument to be a continuing designation, for a period of no more than four (4) years, whenever the appointing member is unable to attend; or
    3. Be revoked at any time by the appointing member in an instrument in writing, over his or her signature, filed with the secretary of the commission as a public record of the commission.
  6. Any person transacting business with, or materially affected by, the business of the commission may accept and rely upon a joint certificate of the secretary of the commission and any member of the commission concerning the designation of any alternate, the time and scope of the designation, and, if it is of a continuing nature, whether and when the designation has been revoked. The joint certificate shall be made and delivered to the person requesting it within a reasonable time after it has been requested in writing, with acceptable identification of the business or transaction to which it refers and the requesting person’s interest in the business or transaction.
  7. Any three (3) persons who are members of the commission or alternates authorized under subsections (4) and (5) of this section shall constitute a quorum and may, by majority vote, transact any business of the commission. Any three (3) members of the commission may call a meeting.
  8. The provisions of KRS 61.070 shall not apply to members of the commission.
  9. The commission shall have authority and may, if in its opinion the cash in the State Treasury is in excess of the amount required to meet current expenditures, invest any and all of the excess cash in:
    1. Obligations and contracts for future delivery of obligations backed by the full faith and credit of the United States or a United States government agency, including but not limited to:
      1. United States Treasury;
      2. Export-Import Bank of the United States;
      3. Farmers Home Administration;
      4. Government National Mortgage Corporation; and
      5. Merchant Marine bonds;
    2. Obligations of any corporation of the United States government or government-sponsored enterprise, including but not limited to:
      1. Federal Home Loan Mortgage Corporation;
      2. Federal Farm Credit Banks:
        1. Bank for Cooperatives;
        2. Federal Intermediate Credit Banks; and
        3. Federal Land Banks;
      3. Federal Home Loan Banks;
      4. Federal National Mortgage Association; and
      5. Tennessee Valley Authority obligations;
    3. Collateralized or uncollateralized certificates of deposit, issued by banks rated in one (1) of the three (3) highest categories by a nationally recognized statistical rating organization or other interest-bearing accounts in depository institutions chartered by this state or by the United States, except for shares in mutual savings banks;
    4. Bankers acceptances for banks rated in the highest short-term category by a nationally recognized statistical rating organization;
    5. Commercial paper rated in the highest short-term category by a nationally recognized statistical rating organization;
    6. Securities issued by a state or local government, or any instrumentality or agency thereof, in the United States, and rated in one (1) of the three (3) highest long-term categories by a nationally recognized statistical rating organization;
    7. United States denominated corporate, Yankee, and Eurodollar securities, excluding corporate stocks, issued by foreign and domestic issuers, including sovereign and supranational governments, rated in one (1) of the three (3) highest long-term categories by a nationally recognized statistical rating organization;
    8. Asset-backed securities rated in the highest category by a nationally recognized statistical rating organization;
    9. Shares of mutual funds, each of which shall have the following characteristics:
      1. The mutual fund shall be an open-end diversified investment company registered under Federal Investment Company Act of 1940, as amended;
      2. The management company of the investment company shall have been in operation for at least five (5) years;
      3. The mutual fund shall be rated in the highest category by a nationally recognized statistical rating organization;
      4. All of the securities in the mutual fund shall be eligible investments pursuant to this section; and
    10. State and local delinquent property tax claims which upon purchase shall become certificates of delinquency secured by interests in real property not to exceed twenty-five million dollars ($25,000,000) in the aggregate. For any certificates of delinquency that have been exonerated pursuant to KRS 132.220(5), the Department of Revenue shall offset the loss suffered by the Finance and Administration Cabinet against subsequent local distributions to the affected taxing districts as shown on the certificate of delinquency.
  10. The State Investment Commission shall promulgate administrative regulations for the investment and reinvestment of state funds in shares of mutual funds, and the regulations shall specify:
    1. The long and short term goals of any investment;
    2. The specification of moneys to be invested;
    3. The amount of funds which may be invested per instrument;
    4. The qualifications of instruments; and
    5. The acceptable maturity of investments.
  11. Any investment in obligations and securities pursuant to subsection (9) of this section shall satisfy this section if these obligations are subject to repurchase agreements, provided that delivery of these obligations is taken either directly or through an authorized custodian.
    1. Income earned from investments made pursuant to this section shall accrue to the credit of the investment income account of the general fund, except that interest from investments of excess cash in the road fund shall be credited to the surplus account of the road fund and interest from investments of excess cash in the game and fish fund shall be credited to the game and fish fund, interest earned from investments of imprest cash funds and funds in the trust and revolving fund for each state public university shall be credited to the appropriate institutional account, and interest earned from the investment of funds accumulated solely by means of contributions and gifts shall not be diverted to any purpose other than that stipulated by the donor, when the donor shall have designated the use to which the interest shall be placed. (12) (a) Income earned from investments made pursuant to this section shall accrue to the credit of the investment income account of the general fund, except that interest from investments of excess cash in the road fund shall be credited to the surplus account of the road fund and interest from investments of excess cash in the game and fish fund shall be credited to the game and fish fund, interest earned from investments of imprest cash funds and funds in the trust and revolving fund for each state public university shall be credited to the appropriate institutional account, and interest earned from the investment of funds accumulated solely by means of contributions and gifts shall not be diverted to any purpose other than that stipulated by the donor, when the donor shall have designated the use to which the interest shall be placed.
    2. Except as otherwise provided by law, or by the obligations and covenants contained in resolutions and trust indentures adopted or entered into for state bond issues, interest earned from the investment of moneys appropriated to the capital construction accounts, trust and agency accounts, and trust and agency revolving accounts shall accrue to the capital construction investment income account.
    3. If there is a revenue shortfall, as defined in KRS 48.010 , of five percent (5%) or less, the secretary of the Finance and Administration Cabinet, upon the recommendation of the state budget director, may direct the transfer of excess unappropriated capital construction investment income to the general fund investment income account. The amount of the transfer shall not exceed the amount of the shortfall in general fund revenues.
    4. If the capital construction investment income is less than that amount appropriated by the General Assembly, the secretary of the Finance and Administration Cabinet may, upon recommendation of the state budget director, direct the transfer of excess unappropriated general fund investment income to the capital construction investment income account. The transfer of general fund investment income revenues to the capital construction investment income account shall be made only when the actual general fund revenues are in excess of the enacted estimates under KRS 48.120 and shall be limited to the amount of the excess general fund revenues. The amount of the transfer shall not exceed the amount of the shortfall in the capital construction fund revenues.
  12. The authority granted by this section to the State Investment Commission shall not extend to any funds that are specifically provided by law to be invested by some other officer or agency of the state government.
  13. The authority granted by this section to the State Investment Commission shall only be exercised pursuant to the administrative regulations mandated by KRS 42.525 .
  14. Each member of the State Investment Commission shall post bond for his or her acts or omissions as a member thereof identical in amount and kind to that posted by the State Treasurer.

History. Repealed, reenacted and amended Acts 1982, ch. 382, § 6, effective July 15, 1982; 1982, ch. 300, § 5, effective July 15, 1982; 1982, ch. 450, § 58, effective July 1, 1983; 1984, ch. 324, § 60, effective July 13, 1984; 1986, ch. 408, § 1, effective July 15, 1986; 1988, ch. 368, § 2, effective July 15, 1988; 1990, ch. 277, § 1, effective July 13, 1990; 1990, ch. 291, § 1, effective July 13, 1990; 1990, ch. 294, § 1, effective July 13, 1990; 1996, ch. 101, § 1, effective July 15, 1996; 1997 (1st Ex. Sess.), ch. 4, § 36, effective May 30, 1997; 1998, ch. 209, § 19, effective March 30, 1998; 2005, ch. 85, § 54, effective June 20, 2005; 2009, ch. 78, § 28, effective June 25, 2009; 2013, ch. 60, § 1, effective June 25, 2013; 2021 ch. 159, § 1, effective June 29, 2021.

Compiler’s Notes.

This section was formerly compiled as KRS 41.380 (Acts 1952, ch. 86; 1954, ch. 245, § 1, effective June 17, 1954; 1980, ch. 295, § 11, effective July 15, 1980; 1980, ch. 347, § 1, effective January 1, 1982) and was repealed, reenacted and amended as this section by Acts 1982, ch. 382, § 6.

Section 21 of Acts 1998, ch. 209, provided that the 1998 amendments to this section “shall apply for sales of delinquent tax bills made on or after March 1, 1998.”

NOTES TO DECISIONS

1.Constitutionality.

The power to appoint members of boards and agencies within the executive department of government is an essentially executive power which cannot be exercised by any member of the legislative department; accordingly, the former provisions in this section by which the Speaker of the House of Representatives and the President Pro Tem of the Senate were authorized to make appointments to the State Investment Commission were an invalid unconstitutional incursion by the General Assembly, or its designees, into the separation of powers doctrine. Legislative Research Com. by Prather v. Brown, 664 S.W.2d 907, 1984 Ky. LEXIS 300 ( Ky. 1984 ) (Decision prior to 1984 amendment).

Opinions of Attorney General.

Interest earned on investments of funds for the tobacco research-trust fund must accrue to the credit of the general expenditure fund. OAG 70-495 .

The investment authority rests with the state investment commission. OAG 70-495 .

Since this section requires that interest accruing on any state funds be placed in the general fund of the State Treasury, the interest on the area development fund could not be paid to the area development districts. OAG 77-481 .

The State Investment Commission may, under the implied authority of this section, upon the establishment of a basic policy (voted on by a majority of the commission) to be applied under the specific major categories of investment permitted in the statute, have the legal authority to delegate the day-to-day administration of investments to a qualified committee or employee of state government, and by such a policy under the statute, the commission would not thereby be delegating its basic power of discretion or judgment, since by the established policy it would be specifically retaining its discretionary authority. OAG 78-542 .

Interest on funds deposited on behalf of the department of fish and wildlife resources should be credited on a pro rata basis to the game and fish fund to be used to carry out the purposes of KRS Chapter 150 as directed by KRS 150.150 . OAG 78-761 .

Under subsection (3), now subsection (10), of this section interest earned from investment of coal severance economic aid fund grant money shall accrue to the credit of the state’s general expenditure fund. OAG 79-630 .

Interest earned from investments of excess cash involving any fund of the state, and not excepted by subsection (4) of this section accrues to the credit of the general fund, except in the cases of the use of road fund and the game and fish fund; accordingly, the State Investment Commission may invest “excess cash” in the Transportation Fund, the Capital Construction Fund, the Agency Receipt Fund, the Trust and Revolving Fund, the Special Deposit Trust Fund, the Bond Redemption and Interest Fund, and the Bond Turnpike Authority Fund, in the form of term repurchase agreements. OAG 82-29 .

The State Investment Commission has the authority under KRS 41.380(2)(see now KRS 42.500 ) and KRS 386.020(1)( l ) to invest “excess cash” in term repurchase agreements involving United States Treasury Bills since such agreements, in reality, involve the state’s purchase of United States Treasury Bills from a financial institution with an agreement that the financial institution will repurchase the Treasury Bills at some definite future date, not to exceed one year from date of investment. OAG 82-29 .

Purchases under subsection (2) of KRS 41.380 (now subsection (8) of this section) may include “repurchase agreements,” involving United States Treasury Bills which would involve the state’s purchase of the United States Treasury Bills from a financial institution with an agreement that the financial institution would repurchase the Treasury Bills at some definite, future date, not to exceed one year from date of investment; however, such investments must be carefully tailored to meet precisely normal payment schedules of state obligations. OAG 82-209 .

Since proposed “reverse repurchase agreements,” by which the state would sell an investment that it held (such as Treasury Bills) for a specified number of days with the condition that the state repurchase the security at the end of that time, contemplated the use of “excess” funds (in excess of that amount required to meet current state expenditures under normal payment schedules) within the time limits of KRS 41.380(2) (now subsection (8) of this section), such agreements would be valid and permissible on the part of the State Investment Commission. OAG 82-209 .

The authority to engage in “reverse repurchase agreements” is implicit in the express power of investment. OAG 82-209 .

The obvious purpose of KRS 386.020 and 41.380 (now this section) is to derive the maximum possible under marketing conditions from the investment of state money. OAG 82-209 .

Though the term “reverse repurchase agreement” is not found in that total terminology in the statutes, the language of KRS 41.380 (now this section) and 386.020(1)( l ) is broad enough to cover this temporary sale of the securities, since the temporary sale does not negate the basic “investment” posture of the Commission in holding the securities involved in this procedure. OAG 82-209 .

This section may be interpreted to allow the State Investment Commission to invest in mutual funds that invest solely in U.S. government securities, including securities subject to repurchase agreements. OAG 90-20 .

In view of the fact that the Council for Education Technology has the duty to invest funds appropriated for education technology, the State Investment Commission would not have authority under this section to invest those same funds. OAG 91-39 .

The Office of Financial Management and Economic Analysis’ (OFMEA) lending of the Workers’ Compensation Funding Commission’s securities constitutes a violation of KRS 342.1227 based on the statutory authority for OFMEA to invest funds in repurchase agreements combined with the separate accounting and full collateralization of the Commission funds. OAG 93-13 .

Research References and Practice Aids

Cross-References.

Housing obligations, investment of public funds in, KRS 386.030 to 386.050 .

Unemployment compensation administration fund and contingent fund, investment of, KRS 341.296 .

42.505. Authority of State Investment Commission.

Subject to the limitations of KRS Chapters 41 and 42 the State Investment Commission is authorized to make purchases, sales, exchanges, investments, and reinvestments, of any of the securities and investments in which any of the state funds shall have been invested, as well as the proceeds of said investments and any money belonging to said funds.

History. Enact. Acts 1982, ch. 382, § 7, effective July 15, 1982.

42.510. Fixing rates of interest — Relationship to Linked Deposit Investment Program. [Repealed]

History. Enact. Acts 1982, ch. 382, § 7, effective July 15, 1982; 1994, ch. 276, § 7, effective July 15, 1994; 1996, ch. 208, § 1, effective July 15, 1996; repealed by 2019 ch. 125, § 5, effective June 27, 2019.

42.515. Investments to be offered first to Kentucky depositories. [Repealed.]

Compiler’s Notes.

This section (Enact. Act 1982, ch. 382, § 9, effective July 15, 1982) was repealed by Acts 1997 (Ex. Sess.), ch. 4, § 44, effective May 30, 1997.

42.520. Priority for assignment of public funds.

  1. The State Investment Commission shall assign public funds to public depositories by priority based on evidence that the public depository serves the convenience and economic development needs of the communities in which they are chartered to do business. The convenience and needs of communities shall include the need for credit services as well as deposit services.
  2. The State Investment Commission shall only assign priorities to public depositories on the basis of compliance with regulations promulgated pursuant to KRS Chapter 13A.

History. Enact. Acts 1982, ch. 382, § 10, effective July 15, 1982; 1994, ch. 276, § 8, effective July 15, 1994; 1996, ch. 208, § 2, effective July 15, 1996.

42.525. Authority to promulgate administrative regulations.

  1. The State Investment Commission shall promulgate administrative regulations for the investment and reinvestment of state funds and the acquisition, retention, management, and disposition of investments.
  2. The regulations shall specify:
    1. The long and short term goals of any investment;
    2. The specification of moneys to be invested;
    3. The amount of funds which may be invested per instrument;
    4. The qualifications of instruments;
    5. The acceptable maturity of investments;
    6. The investment procedure with respect to in-state and out-of-state depositories provided that funds available for investment shall be offered first to qualified Kentucky depositories consistent with the investment guidelines; and
    7. The distribution method of funds among types of institutions.

History. Enact. Acts 1982, ch. 382, § 11, effective July 15, 1982; 1997 (1st Ex. Sess.), ch. 4, § 37, effective May 30, 1997.

42.530. Quarterly reports of commission.

The State Investment Commission shall render quarterly written reports concerning the performance of each investment to the Legislative Research Commission. The reports may contain recommendations of the commission for legislative or other action to effectuate the purposes and policies of this chapter.

History. Enact. Acts 1982, ch. 382, § 12, effective July 15, 1982.

42.535. Annual reports of agencies holding funds.

Each agency holding funds listed in this section shall make a report according to generally accepted accounting principles of all money received and disbursed by the listed funds during each fiscal year, on or before the fifteenth of July, showing the receipts, expenditures, depositories, rates of interest paid by depositories, investments, and rates of return on investments by each listed fund to the Office of the Controller. The funds which shall be reported are:

  1. Tobacco research trust fund;
  2. The uninsured employers’ fund;
  3. The administrative fund created by KRS 342.440 , also known as the workers’ compensation maintenance fund;
  4. The special claim fund; and
  5. The common school fund.

History. Enact. Acts 1982, ch. 382, § 13, effective July 15, 1982; 1997 (1st Ex. Sess.), ch. 4, § 38, effective May 30, 1997; 1998, ch. 85, § 2, effective July 15, 1998.

Legislative Research Commission Note.

(5/30/97). KRS 342.440 , cited in this statute, was repealed by 1987 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 72(2), effective January 4, 1988.

Opinions of Attorney General.

This section and KRS 42.550 suggest that the Legislature fully expects the Council for Education Technology, in its advisory capacity to the State Board, to invest the education technology funds, as opposed to the State Investment Commission. OAG 91-39 .

42.540. Annual reports of nonprofit fiduciary holding funds for benefit of state organization.

Notwithstanding KRS 41.290 , every nonprofit fiduciary holding funds for the benefit of any form of state organization, including, but not limited to, Eastern Kentucky University, Kentucky State University, Morehead State University, Murray State University, Northern Kentucky University, University of Kentucky, University of Louisville, Western Kentucky University, Kentucky Community and Technical College System, and the State Fair Board shall make a report according to generally accepted accounting principles of all money received and disbursed during each fiscal year, on or before the fifteenth of July, showing receipts, expenditures, depositories, rates of interest paid by depositories, investments, and rates of return in investments to the Office of the Controller. These fiduciaries include, but are not limited to, Eastern Kentucky University Foundation; Kentucky State University Foundation, Inc.; Morehead State University Foundation, Inc.; Morehead Alumni Foundation, Inc.; Eagle Athletic Foundation, Inc.; Murray State University Foundation; Northern Kentucky University Foundation, Inc.; University of Kentucky Research Foundation; University of Kentucky Athletics Association; the Fund for the Advancement of Education and Research in the University of Kentucky Medical Center; Health Care Collection Service, Inc.; McDowell Cancer Network, Inc.; University of Kentucky-Business Partnership Foundation, Inc.; Kentucky Medical Services Foundation, Inc.; University of Louisville Foundation, Inc.; University of Louisville Hospital, Inc.; University of Louisville Institute of Industrial Research, Inc.; University of Louisville Medical School Fund, Inc.; the College Heights Foundation; KFEC Research and Development Foundation, Inc.; Kentucky Export Resources Authority, Inc.; and all similar nonprofit fiduciaries for the benefit of any form of state organization and their successors.

History. Enact. Acts 1982, ch. 382, § 14, effective July 15, 1982; 1990, ch. 325, § 22, effective July 13, 1990; 1997 (1st Ex. Sess.), ch. 1, § 32, effective May 30, 1997; 1997 (1st Ex. Sess.), ch. 4, § 39, effective May 30, 1997.

Legislative Research Commission Note.

(7/28/97). This section was amended by 1997 (1st Extra. Sess.) Ky. Acts ch. 1, sec. 32, and ch. 4, sec. 39, which do not appear to be in conflict and have been compiled together under KRS 7.136(3).

42.545. Annual report of each agency authorized to issue bonds.

Each agency authorized to issue bonds listed in this section shall make a report according to generally accepted accounting principles of all money received and disbursed during each fiscal year, on or before the fifteenth of July, showing the receipts, expenditures, trustees, depositories, rates of interest paid by depositories, investments, and rates of return on investments by each agency to the Office of the Controller. The agencies required to report under this section are Eastern Kentucky University; Kentucky State University; Morehead State University; Murray State University; Northern Kentucky University; University of Kentucky; University of Louisville; Western Kentucky University; Kentucky Community and Technical College System; Kentucky Housing Corporation; Kentucky Higher Education Student Loan Corporation; Kentucky School Building Authority; the Turnpike Authority of Kentucky; the State Property and Buildings Commission; Churchill Downs Authority; State Fair Board; Department of Fish and Wildlife Resources; Water Resources Authority of Kentucky; and any other agency or instrumentality authorized to issue bonds.

History. Enact. Acts 1982, ch. 382, § 15, effective July 15, 1982; 1997 (1st Ex. Sess.), ch. 1, § 33, effective May 30, 1997; 1997 (1st Ex. Sess.), ch. 4, § 40, effective May 30, 1997; 1998, ch. 83, § 5, effective July 15, 1998; 2005, ch. 85, § 55, effective June 20, 2005; 2020 ch. 36, § 1, effective July 15, 2020.

42.550. Annual reports of school funds from Department of Education.

The Department of Education shall make a report according to generally accepted accounting principles of all money received and disbursed from the common school fund and the Support Education Excellence in Kentucky (SEEK) Program to local school districts showing their receipts, expenditures, depositories, rates of interest paid by depositories, investments, and rates of return on investments by each fund to the Office of the Controller for each fiscal year on or before the fifteenth of July.

History. Enact. Acts 1982, ch. 382, § 20, effective July 15, 1982; 1990, ch. 476, Pt. IV, § 117, effective July 13, 1990; 1997 (1st Ex. Sess.), ch. 4, § 41, effective May 30, 1997.

Opinions of Attorney General.

KRS 42.535 and this section suggest that the Legislature fully expects the Council for Education Technology, in its advisory capacity to the State Board, to invest the education technology funds, as opposed to the State Investment Commission. OAG 91-39 .

42.555. Investment commission as Sinking Fund Commission — Sale of stock in Bank of Kentucky.

  1. For the purposes of Section 185 of the Constitution of Kentucky, the State Investment Commission shall constitute the Sinking Fund Commission.
  2. The State Investment Commission may sell the stock in the Bank of Kentucky referred to in Sections 184 and 185 of the Constitution of Kentucky. The State Investment Commission may sell and reinvest the proceeds of the sale of the stock in the Bank of Kentucky from time to time.

History. Enact. Acts 1982, ch. 382, § 21, effective July 15, 1982.

Low-Income Energy Assistance Trust Fund

42.560. Energy assistance trust fund — Allocation of interest.

  1. There is established in the Treasury of the Commonwealth a trust fund to be known as the “Energy Assistance Trust Fund” referred to in KRS 42.560 to 42.572 as the “trust fund.”
  2. The trust fund shall consist of any oil overcharge refunds which become available to the state as a result of litigation for alleged overcharges for crude oil or refined petroleum products sold during the period of time in which federal price controls on such products were in effect, any moneys as may be appropriated by the general fund, and any investment interest earned on the fund.
  3. The fund shall be managed by the state Office of Financial Management within the Office of the Controller and all moneys in excess of the amount to be disbursed in a given fiscal year shall be invested to maximize returns. The principal and any interest earnings of the trust fund shall at no time lapse to the general fund.
  4. The accumulated interest shall be made available as follows:
    1. Fifty percent (50%) to the Finance and Administration Cabinet to be allocated to weatherization services to low-income households; and
    2. Fifty percent (50%) to the Cabinet for Health and Family Services to be allocated to low-income energy assistance services.

The funds to be available for expenditure in any fiscal year shall be appropriated by the General Assembly from the trust fund as provided in KRS 48.300 .

History. Enact. Acts 1986, ch. 262, § 1, effective April 3, 1986; 1988, ch. 10, § 1, effective February 19, 1988; 1990, ch. 321, § 6, effective July 13, 1990; 1998, ch. 426, § 81, effective July 15, 1998; 2000, ch. 46, § 10, effective July 14, 2000; 2005, ch. 85, § 56, effective June 20, 2005; 2005, ch. 99, § 102, effective June 20, 2005; 2012, ch. 69, § 5, effective July 12, 2012; 2012, ch. 158, § 8, effective July 12, 2012.

Legislative Research Commission Note.

(7/12/2012). This statute was amended by 2012 Ky. Acts chs. 69 and 158, which do not appear to be in conflict and have been codified together.

(7/12/2012). 2012 Ky. Acts ch. 158, sec. 82, provides: “The Finance and Administration Cabinet, which is assigned the functions, duties, and responsibilities associated with the administration of the weatherization program operated in accordance with the requirements for funding received from the United States Department of Energy and any subordinate entities in Executive Order 2011-353 and this Act, is hereby authorized to engage and contract with the Kentucky Housing Corporation to operate and manage the weatherization program if the cabinet deems it to be in the best interest of the weatherization program and the Commonwealth of Kentucky.”

42.562. Low-income energy assistance trust fund board. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1986, ch. 262, § 2, effective April 1, 1986) was repealed by Acts 1988, ch. 10, § 4, effective February 19, 1988.

42.564. Review of investments — Estimate of funds available. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1986, ch. 262, § 3, effective April 1, 1986) was repealed by Acts 1988, ch. 10, § 4, effective February 19, 1988.

42.566. Energy assistance trust fund — Allocation of appropriations.

The funds appropriated by the General Assembly from the energy assistance trust fund shall be expended in a manner consistent with the judgments and settlements, as amended, which produced the oil overcharge refunds, as follows:

  1. The sum of five hundred thousand dollars ($500,000) or eight percent (8%) of the amount appropriated each fiscal year, whichever is greater, shall be distributed annually to the Energy and Environment Cabinet for expenditure in the Institutional Conservation Program established pursuant to Part G of Title III of the Energy Policy and Conservation Act, 42 U.S.C. secs. 6371 et seq. The source of these funds shall be deemed to be the trust funds produced by the Stripper Well litigation, In Re Department of Energy Stripper Well Exemption Litigation, D.C. Kan., M.D.L. No. 378, and the Diamond Shamrock litigation, Diamond Shamrock Refining Co. v. Standard Oil of Indiana, D.C. Ind., Civil Action No. C-84-1432, and interest accumulated thereon; and
  2. The balance of the trust funds appropriated for expenditure in any fiscal year shall be distributed as follows:
    1. Forty percent (40%) to the Finance and Administration Cabinet to be allocated to the cabinet’s program for weatherization of low-income households established pursuant to Part A of the Energy Conservation and Existing Buildings Act of 1976, 42 U.S.C. secs. 6861 et seq.; and
    2. Sixty percent (60%) to the Cabinet for Health and Family Services to be allocated to the cabinet’s program for energy crisis or prevention services for low-income households established pursuant to the Low-Income Home Energy Assistance Act of 1981, 42 U.S.C. secs. 8621 et seq.

History. Enact. Acts 1986, ch. 262, § 4, effective April 3, 1986; 1988, ch. 10, § 2, effective February 19, 1988; 1990, ch. 325, § 23, effective July 13, 1990; 1998, ch. 426, § 82, effective July 15, 1998; 2005, ch. 99, § 103, effective June 20, 2005; 2010, ch. 24, § 33, effective July 15, 2010; 2012, ch. 69, § 6, effective July 12, 2012; 2012, ch. 158, § 9, effective July 12, 2012.

Legislative Research Commission Note.

(7/12/2012). This statute was amended by 2012 Ky. Acts chs. 69 and 158, which do not appear to be in conflict and have been codified together.

(7/12/2012). 2012 Ky. Acts ch. 158, sec. 82, provides: “The Finance and Administration Cabinet, which is assigned the functions, duties, and responsibilities associated with the administration of the weatherization program operated in accordance with the requirements for funding received from the United States Department of Energy and any subordinate entities in Executive Order 2011-353 and this Act, is hereby authorized to engage and contract with the Kentucky Housing Corporation to operate and manage the weatherization program if the cabinet deems it to be in the best interest of the weatherization program and the Commonwealth of Kentucky.”

(6/8/2011). The Reviser of Statutes has corrected the internal numbering of subdivisions of this statute from the way they appeared in 2010 Ky. Acts ch. 24, sec. 33, under the authority of KRS 7.136 .

42.568. Withdrawal of funds. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1986, ch. 262, § 5, effective April 3, 1986) was repealed by Acts 1988, ch. 10, § 4, effective February 19, 1988.

42.570. Limitation on expenditures. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1986, ch. 262, § 6, effective April 3, 1986) was repealed by Acts 1988, ch. 10, § 4, effective February 19, 1988.

42.572. Annual status report.

The State Office of Financial Management shall prepare and submit to the Legislative Research Commission a report by July 30 of each year on the operational and financial status of the fund.

History. Enact. Acts 1986, ch. 262, § 7, effective April 3, 1986; 1988, ch. 10, § 3, effective February 19, 1988; 1990, ch. 321, § 7, effective July 13, 1990; 2000, ch. 46, § 11, effective July 14, 2000.

42.574. Administrative regulations. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1986, ch. 262, § 8, effective April 3, 1986) was repealed by Acts 1988, ch. 10, § 4, effective February 19, 1988.

Kentucky Bluegrass Turns Green Program

42.580. Definitions for KRS 42.580 to 42.588.

As used in KRS 42.580 to 42.588 :

  1. “Cabinet” means the Finance and Administration Cabinet;
  2. “Demand-side management” has the same meaning as in KRS 278.010 ;
  3. “Energy audit” has the same meaning as in KRS 56.770 ;
  4. “Energy-efficient heating, cooling, ventilation, or hot water system” has the same meaning as in KRS 141.435 ;
  5. “Energy-efficient interior lighting system” has the same meaning as in KRS 141.435 ;
  6. “Energy-efficient windows and storm doors” has the same meaning as in KRS 141.435 ;
  7. “Engineered demand-side management project” means a project undertaken to reduce the amount of energy consumed in an existing structure, including but not limited to:
    1. Energy-efficient heating, cooling, ventilation, or hot water systems;
    2. Energy-efficient interior lighting systems;
    3. Energy-efficient windows and storm doors;
    4. Qualified energy property;
    5. Upgraded insulation;
    6. Solar water-heating systems; and
    7. Any other energy conservation measures that will reduce energy costs, including those that will use solar power, either active or passive;
  8. “Private sector building” means a building owned by a private retail, commercial, or industrial business;
  9. “Public sector building” means a building owned by the Commonwealth of Kentucky, any public university of the Commonwealth, or any public community college of the Commonwealth;
  10. “Qualified energy property” has the same meaning as in KRS 141.435 ;
  11. “Simple payback period” has the same meaning as in KRS 56.770 ;
  12. “Solar water-heating system” has the same meaning as in KRS 141.435 ; and
  13. “Upgraded insulation” has the same meaning as in KRS 141.435 .

History. Enact. Acts 2008, ch. 139, § 21, effective July 15, 2008; repealed and reenact., Acts 2010, ch. 5, § 20, effective February 25, 2010; 2014, ch. 65, § 5, effective July 15, 2014.

Legislative Research Commission Note.

(2/25/2010). 2010 Ky. Acts ch. 5, sec. 28, provides that the repeal and reenactment of this section in that Act “shall apply retroactively to July 15, 2008.”

42.582. Kentucky Bluegrass Turns Green Program — Purposes — Funding.

  1. There is established in the cabinet the Kentucky Bluegrass Turns Green Program for the purposes of:
    1. Concentrating on energy demand-side management in private and public sector buildings;
    2. Generating savings to taxpayers and the Commonwealth;
    3. Allowing for continued economic development;
    4. More efficiently using the Commonwealth’s precious natural resources; and
    5. Establishing the Commonwealth as a benchmark state for demand-side management efforts.
  2. The Kentucky Blue Grass Turns Green Program shall consist of the bluegrass turns green public sector grant fund established in KRS 42.584 and the bluegrass turns green private sector loan fund established in KRS 42.586 .

History. Enact. Acts 2008, ch. 139, § 22, effective July 15, 2008; repealed and reenact., Acts 2010, ch. 5, § 21, effective February 25, 2010.

Legislative Research Commission Note.

(2/25/2010). 2010 Ky. Acts ch. 5, sec. 28, provides that the repeal and reenactment of this section in that Act “shall apply retroactively to July 15, 2008.”

42.584. Bluegrass turns green public sector grant fund — Purpose — Eligibility — Payback period — Administrative regulations.

    1. The bluegrass turns green public sector grant fund is created as a trust and agency fund. The fund shall be administered by the cabinet and shall consist of: (1) (a) The bluegrass turns green public sector grant fund is created as a trust and agency fund. The fund shall be administered by the cabinet and shall consist of:
      1. Proceeds from grants, contributions, appropriations, or other moneys made available for purposes of the trust and agency fund; and
      2. Funds derived from the bond issuance authorized under 2008 Ky. Acts ch. 139, sec. 27.
    2. Notwithstanding KRS 45.229 , fund amounts not expended at the close of the fiscal year shall not lapse but shall be carried forward to the next fiscal year. Any interest earnings of the trust and agency fund shall become part of the trust and agency fund and shall not lapse.
  1. Trust and agency fund moneys shall be used by the cabinet to provide grants to the public sector for engineered demand-side management projects in public sector buildings. The cabinet shall not award more than one (1) grant per public university campus or public community college campus within an eighteen (18) month period.
  2. To be eligible for a grant under this section, the cost of a proposed engineered demand-side management project shall be at least five thousand dollars ($5,000) and shall not exceed one million five hundred thousand dollars ($1,500,000) per project.
  3. Beginning July 1, 2009, and ending June 30, 2013, the simple payback period for an approved engineered demand-side management project shall be no more than five (5) years. Beginning July 1, 2013, the cabinet may consider a simple payback period of no more than twelve (12) years.
  4. Moneys in the grant fund are hereby appropriated for the purposes set forth in subsection (2) of this section.
  5. The cabinet shall not approve an applicant for a grant under this section, unless the applicant:
    1. Agrees to undergo and pay for an energy audit to establish a baseline of energy consumption; and
    2. Meets all the requirements established in this section and any regulations promulgated thereunder.

History. Enact. Acts 2008, ch. 139, § 23, effective July 15, 2008; repealed and reenact., Acts 2010, ch. 5, § 22, effective February 25, 2010.

Legislative Research Commission Note.

(2/25/2010). 2010 Ky. Acts ch. 5, sec. 28, provides that the repeal and reenactment of this section in that Act “shall apply retroactively to July 15, 2008.”

42.586. Bluegrass turns green private sector loan fund — Purpose — Eligibility — Payback period — Interest rate — Administrative regulations.

    1. The bluegrass turns green private sector loan fund is created as a separate revolving fund. The fund shall be administered by the cabinet and shall consist of: (1) (a) The bluegrass turns green private sector loan fund is created as a separate revolving fund. The fund shall be administered by the cabinet and shall consist of:
      1. Proceeds from grants, contributions, appropriations, or other moneys made available for purposes of the revolving fund;
      2. Loan repayments made by the private sector;
      3. Funds derived from the bond issuance authorized under 2008 Ky. Acts ch. 139, sec. 28.
    2. Notwithstanding KRS 45.229 , fund amounts not expended at the close of a fiscal year shall not lapse but shall be carried forward to the next fiscal year. Any interest earnings of the fund shall become part of the revolving fund and shall not lapse.
  1. Revolving fund moneys shall be used by the cabinet to provide low-interest loans to the private sector for engineered demand-side management projects in private sector buildings. The cabinet shall not have more than one (1) loan outstanding at a time to any private retail, commercial, or industrial business.
  2. To be eligible for a loan under this section, the cost of a proposed engineered demand-side management project shall be at least five thousand dollars ($5,000) and shall not exceed one million five hundred thousand dollars ($1,500,000) per project.
  3. Beginning July 1, 2009, and ending June 30, 2013, the simple payback period for an approved engineered demand-side management project shall be no more than five (5) years. Beginning July 1, 2013, the cabinet may consider a simple payback period of no more than twelve (12) years.
  4. The loans provided under this section shall be subject to the prime interest rate minus one percent (1%).
  5. Moneys in the fund are hereby appropriated for the purposes set forth in subsection (2) of this section.
  6. The cabinet shall not approve an applicant for a loan under this section, unless the applicant:
    1. Can demonstrate that the applicant has no outstanding liabilities with the Commonwealth;
    2. Can demonstrate that the applicant has a positive payment history with the applicant’s electricity provider for the preceding three (3) consecutive years;
    3. Agrees to undergo and pay for an energy audit to establish a baseline of energy consumption; and
    4. Meets all the requirements established in this section and any administrative regulations promulgated thereunder.

History. Enact. Acts 2008, ch. 139, § 24, effective July 15, 2008; repealed and reenact., Acts 2010, ch. 5, § 23, effective February 25, 2010.

Legislative Research Commission Note.

(2/25/2010). 2010 Ky. Acts ch. 5, sec. 28, provides that the repeal and reenactment of this section in that Act “shall apply retroactively to July 15, 2008.”

42.588. Administrative regulations — Reports to Governor and Legislative Research Commission.

  1. The cabinet shall, by administrative regulations promulgated in accordance with KRS Chapter 13A:
    1. Develop a method to score applications for the bluegrass turns green private sector loan fund established in KRS 42.586 and the bluegrass turns green public sector grant fund established in KRS 42.584 ;
    2. Develop a list of companies qualified to perform energy audits for the purposes of determining a baseline of energy consumption and any subsequent projected energy cost savings for:
      1. Private sector recipients of low-interest loans provided from the bluegrass turns green private sector loan fund established in KRS 42.586 ; and
      2. Public sector recipients of grants awarded from the public sector turns green grant fund established in KRS 42.584 ; and
    3. Establish a process for the collection of loan payments from the private sector to repay amounts that were made available under the bluegrass turns green loan private sector fund. The cabinet shall also promulgate any other administrative regulations necessary to administer the provisions of KRS 42.580 to 42.588 .
  2. The cabinet shall report to the Governor and the Legislative Research Commission on or before November 1, 2009, and on or before each November 1 thereafter, the following for the bluegrass turns green private sector loan fund and the bluegrass turns green public sector grant fund for the immediately preceding fiscal year:
    1. The number of applicants;
    2. A description of the engineered demand-side management projects on which loans or grants were provided;
    3. The total amount loaned to the private sector and the total amount of grants provided to the public sector;
    4. The projected private sector energy cost savings;
    5. The projected public sector energy cost savings;
    6. The number of applicants and the amount of loan and grants for which funding was not available; and
    7. Based upon the energy audits performed, the amount of increased energy capacity realized.

History. Enact. Acts 2008, ch. 139, § 25, effective July 15, 2008; repealed and reenact., Acts 2010, ch. 5, § 24, effective February 25, 2010.

Legislative Research Commission Note.

(2/25/2010). 2010 Ky. Acts ch. 5, sec. 28, provides that the repeal and reenactment of this section in that Act “shall apply retroactively to July 15, 2008.”

Reports to Legislative Research Commission

42.600. Report of Court of Justice as to collections.

The Court of Justice shall make a report according to generally accepted accounting principles of all money received and disbursed pursuant to fines, court costs, or fees established by enactment of the General Assembly, showing the receipts, expenditures, depositories, rates of interest paid by depositories, investments, and rates of return on investments by each fund to the Legislative Research Commission for each fiscal year on or before the 15th of July.

History. Enact. Acts 1982, ch. 382, § 16, effective July 15, 1982.

42.605. Reports of Court of Justice concerning money judgments.

The Court of Justice shall make a report according to generally accepted accounting principles of all money received and disbursed pursuant to any action based on a cause of action established by enactment of the General Assembly, showing the receipts, expenditures, depositories, rates of interest paid by depositories, investments, and rates of return on investments by each fund to the Legislative Research Commission for each fiscal year on or before the 15th of July.

History. Enact. Acts 1982, ch. 382, § 17, effective July 15, 1982.

42.610. Reports to be similar in form.

The Legislative Research Commission shall, by regulations promulgated pursuant to KRS Chapter 13A, require reports by the Court of Justice, under KRS 42.600 and 42.605 , to be substantially similar in form to the reports made to the State Investment Commission under KRS 42.535 to 42.550 .

History. Enact. Acts 1982, ch. 382, § 18, effective July 15, 1982.

Legislative Research Commission Note.

(10/5/90). Pursuant to KRS 7.136(1), KRS Chapter 13A has been substituted for the prior reference to KRS Chapter 13 in this statute. The sections in KRS Chapter 13 were repealed by 1984 Ky. Acts ch. 417, § 36 and KRS Chapter 13A was created in that same chapter of the 1984 Ky. Acts.

42.615. Annual reports of retirement funds.

Each retirement fund listed in this section shall make a report according to generally accepted accounting principles of all money received and disbursed by the listed fund during each fiscal year on or before the first day of October after the fiscal year, showing receipts, expenditures, depositories, rates of interest paid by depositories, investments, and rates of return on investments by each listed fund to the Legislative Research Commission. The funds which shall be reported are:

  1. Kentucky employees’ retirement fund;
  2. State Police retirement fund;
  3. County employees’ retirement fund;
  4. Kentucky retirement systems insurance fund;
  5. Funds controlled by the Teachers’ Retirement System of the State of Kentucky;
  6. Judicial retirement fund;
  7. Legislators retirement fund; and
  8. The Kentucky state public employees deferred compensation trust fund.

History. Enact. Acts 1982, ch. 382, § 19, effective July 15, 1982; 1988, ch. 77, § 1, effective July 15, 1988.

Division of Geographic Information Systems

42.630. Legislative findings.

The General Assembly finds and declares that:

  1. Much of the Commonwealth’s information is geographically referenced and may be presented through geographic information systems;
  2. Geographic information systems allow for the exchange of information between levels of government and facilitate the management of the Commonwealth’s natural, human, cultural, and economic resources;
  3. There is a need to reduce redundancy in data-collection and development efforts, to coordinate the various activities in geographic information systems, and to share geographic information system resources and expertise to maximize the Commonwealth’s investment in geographic information systems technology;
  4. Considerations of cost and the need for the transfer of information among agencies of state government in the most timely and useful form possible require a uniform policy and coordinated approach for the use of geographic information systems;
  5. It is the policy of the Commonwealth of Kentucky to coordinate and direct the use of geographic information resources and technologies to provide the most cost-effective and useful retrieval of information by its elected and appointed officials.

History. Enact. Acts 1994, ch. 327, § 1, effective July 15, 1994.

42.640. Definitions for KRS 42.650. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1994, ch. 327, § 2, effective July 15, 1994) was repealed by Acts 2000, ch. 506, § 25, effective July 14, 2000; and Acts 2000, ch. 536, § 37, effective July 14, 2000. For present law, see KRS 11.503 .

42.650. Division of Geographic Information Systems — Powers and duties — Authority for administrative regulations.

  1. The Division of Geographic Information Systems is hereby established in the Office of Architecture and Governance within the Commonwealth Office of Technology in the Finance and Administration Cabinet.
  2. The Division of Geographic Information Systems shall be headed by a division director, whose appointment is subject to KRS 12.050 . The division director may employ personnel, pursuant to the provisions of KRS Chapter 18A, as required to perform the functions of the office.
  3. The division may solicit, receive, and consider proposals for funding from any state agency, federal agency, local government, university, nonprofit organization, or private person or corporation. The division may also solicit and accept money by grant, gift, donation, bequest, legislative appropriation, or other conveyance.
  4. The division shall:
    1. Establish a central statewide geographic information clearinghouse to maintain map inventories, information on current and planned geographic information systems applications, information on grants available for the acquisition or enhancement of geographic information resources, and a directory of geographic information resources available within the state or from the federal government;
    2. Coordinate multiagency geographic information system projects, including overseeing the development and maintenance of statewide base maps and geographic information systems;
    3. Provide access to both consulting and technical assistance, and education and training, on the application and use of geographic information technologies to state and local agencies;
    4. Maintain, update, and interpret geographic information and geographic information systems standards, under the direction of the council;
    5. Provide geographic information system services, as requested, to agencies wishing to augment their geographic information system capabilities;
    6. In cooperation with other agencies, evaluate, participate in pilot studies, and make recommendations on geographic information systems hardware and software;
    7. Assist the council with review of agency information resource plans and participate in special studies as requested by the council;
    8. Provide staff support and technical assistance to the Geographic Information Advisory Council; and
    9. Prepare proposed legislation and funding proposals for the General Assembly which will further solidify coordination and expedite implementation of geographic information systems.
  5. The division may promulgate necessary administrative regulations for the furtherance of this section.

HISTORY: Enact. Acts 1994, ch. 327, § 3, effective July 15, 1994; 2005, ch. 85, § 57, effective June 20, 2005; 2012, ch. 69, § 7, effective July 12, 2012; 2018 ch. 78, § 1, effective July 14, 2018; 2021 ch. 81, § 4, effective June 29, 2021.

Kentucky Community Crisis Response Board

42.660. Definitions for KRS 42.660 to 42.680. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1996, ch. 316, § 1, effective July 15, 1996) was repealed, reenacted and amended as KRS 36.250 by Acts 1998, ch. 86, § 1, effective July 15, 1998.

42.665. Kentucky Community Crisis Response Board — Members — Meetings. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1996, ch. 316, § 2, effective July 15, 1996) was repealed, reenacted and amended as KRS 36.255 by Acts 1998, ch. 86, § 2, effective July 15, 1998.

42.670. Duties of board. [Repealed and reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1996, ch. 316, § 3, effective July 15, 1996) was repealed and reenacted as KRS 36.260 by Acts 1998, ch. 86, § 3, effective July 15, 1998.

42.675. Attorney General to represent board members in civil proceedings. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1996, ch. 316, § 4, effective July 15, 1996) was repealed, reenacted and amended as KRS 36.265 by Acts 1998, ch. 86, § 4, effective July 15, 1998.

42.680. Status of state and local government employees acting on behalf of board. [Repealed, reenacted and amended.]

Compiler’s Notes.

This section (Enact. Acts 1996, ch. 316, § 5, effective July 15, 1996) was repealed, reenacted and amended as KRS 36.270 by Acts 1998, ch. 86, § 5, effective July 15, 1998.

42.700. Medical professional liability insurance for charitable health care facilities and volunteer caregivers — Fee on physicians and attorneys for payment of premiums. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1994, ch. 87, § 1, effective July 15, 1994) was repealed by Acts 1996, ch. 348, § 4, effective July 15, 1996. For present law see KRS 304.40-075 .

Display of Historic Artifacts, Monuments, Symbols, and Texts

42.705. Legislative findings and declarations — Display of historic religious and nonreligious artifacts, monuments, symbols, and texts in public buildings and on public property owned by the Commonwealth.

The General Assembly hereby finds and declares as follows:

  1. The Commonwealth’s public buildings and their surrounding grounds provide Kentucky’s citizens and others a place at which they may conduct public business, visit and interact with government officials, and learn about the Commonwealth’s history and government;
  2. The Commonwealth’s public buildings and public properties are themselves important symbols of Kentucky’s history;
  3. Whether it be former battlegrounds, Native American sites, parks, recreation areas, historic government sites, homes of famous Kentuckians, or any other site of interest, without historic artifacts, monuments, symbols, and texts on the properties and in the buildings, most persons would not even know of the significance of the site or building;
  4. Kentucky is justly proud of its history, as the past is the prologue to how we live today, how our government functions, and what things we hold to be important to us;
  5. It is not in Kentucky’s best interest to hide its heritage or traditions, or the beliefs or deeply held opinions of its citizens;
  6. It is in Kentucky’s best interest that its public buildings and public properties reflect the Commonwealth’s rich history by exhibiting items of significance to Kentucky’s civic and cultural development;
  7. The display of historic artifacts, monuments, symbols, and texts in and on the grounds of Kentucky’s public buildings and public properties promotes its citizens’ awareness of their common history and an appreciation of the persons and events contributing to that history;
  8. The free exercise of religion, as well as the right to have no religion, is a right guaranteed by the Constitution of the United States and the Constitution of Kentucky;
  9. The right of the people to express themselves is enshrined in the freedom of speech guaranteed by the Constitution of the United States and the Constitution of Kentucky;
  10. While the authors of the Constitution of the United States and the Constitution of Kentucky were guaranteeing the free exercise of religion and prohibiting the establishment of a state-sponsored religion, these same authors and the public officials of that date publicly and regularly proclaimed a belief in a supreme being, prayed openly, and placed religious-based statements and symbols in and on their public buildings and properties, and that tradition has continued unbroken to this day;
  11. The free exercise of religion, in all of its myriad expressions, is a significant component of Kentucky’s historical heritage and may be acknowledged as such;
  12. Historic artifacts, monuments, symbols, and texts, including but not limited to religious materials, may be displayed in Kentucky’s public schools, within the framework of applicable legal precedents, if they are displayed in connection with a course of study that is academic, balanced, objective, and not devotional in nature, and that neither favors nor disfavors religion generally or any particular religious belief; and
  13. Historic artifacts, monuments, symbols, and texts, including but not limited to religious materials, may be displayed in Kentucky’s public buildings and on Kentucky’s public properties if they are displayed in a:
    1. Balanced, objective, and not solely religious manner;
    2. Manner that neither favors nor disfavors religion generally;
    3. Manner that neither favors nor disfavors any religious belief; and
    4. Manner which promotes the display of Kentucky’s historic, cultural, political, and general heritage and achievements.

History. Enact. Acts 2006, ch. 34, § 1, effective March 24, 2006.

42.710. Agency or instrumentality of state authorized to display historic religious and nonreligious artifacts, monuments, symbols, and texts in public buildings and on public property owned by the Commonwealth.

Any agency or instrumentality of state government may display historic artifacts, monuments, symbols, and texts, including but not limited to religious materials, in public buildings and public property owned by the Commonwealth if the display is consistent with the requirements of KRS 42.705 .

History. Enact. Acts 2006, ch. 34, § 2, effective March 24, 2006.

Information Technology

42.720. Legislative findings.

The General Assembly finds and declares that:

  1. The establishment of the position of the executive director of the Commonwealth Office of Technology, appointed by the secretary of the Finance and Administration Cabinet with the approval of the Governor, as the Commonwealth’s single point of contact and spokesperson for all matters related to information technology and resources, including policies, standard setting, deployment, strategic and tactical planning, acquisition, management, and operations is necessary and in keeping with the industry trends of the private and public sectors;
  2. The appropriate use of information technology by the Commonwealth can improve operational productivity, reduce the cost of government, enhance service to customers, and make government more accessible to the public;
  3. Government-wide planning, investment, protection, and direction for information resources must be enacted to:
    1. Ensure the effective application of information technology on state business operations;
    2. Ensure the quality, security, and integrity of state business operations; and
    3. Provide privacy to the citizens of the Commonwealth;
  4. The Commonwealth must provide information technology infrastructure, technical directions, and a proficient organizational management structure to facilitate the productive application of information technology and resources to accomplish programmatic missions and business goals;
  5. Oversight of large scale and government statewide systems or projects is necessary to protect the Commonwealth’s investment and to ensure appropriate integration with existing or planned systems;
  6. A career development plan and professional development program for information technology staff of the executive branch is needed to provide key competencies and adequate on-going support for the information resources of the Commonwealth and to ensure that the information technology staff will be managed as a Commonwealth resource;
  7. The Commonwealth is in need of information technology advisory capacities to the Governor and the agencies of the executive cabinet;
  8. Appropriate public-private partnerships to supplement existing resources must be developed as a strategy for the Commonwealth to comprehensively meet its spectrum of information technology and resource needs;
  9. Technological and theoretical advances in information use are recent in origin, immense in scope and complexity, and change at a rapid rate, which presents Kentucky with the opportunity to provide higher quality, more timely, and more cost-effective government services to ensure standardization, interoperability, and interconnectivity;
  10. The sharing of information resources and technologies among executive branch state agencies is the most cost-effective method of providing the highest quality and most timely government services that would otherwise be cost-prohibitive;
  11. The ability to identify, develop, and implement changes in a rapidly moving field demands the development of mechanisms to provide for the research and development of technologies that address systems, uses, and applications; and
  12. The exercise by the executive director of the Commonwealth Office of Technology of powers and authority conferred by KRS 42.720 to 42.742 , 45.253 , 171.420 , 186A.040 , and 186A.285 shall be deemed and held to be the performance of essential governmental functions.

History. Enact. Acts 1998, ch. 353, § 1, effective July 15, 1998; repealed, reenact., and amend. Acts 2000, ch. 506, § 1, effective July 14, 2000; 2000, ch. 536, § 1, effective July 14, 2000; 2005, ch. 85, § 21, effective June 20, 2005; 2005, ch. 99, § 3, effective June 20, 2005; repealed, reenact. and amend., Acts 2009, ch. 12, § 2, effective June 25, 2009; 2020 ch. 36, § 2, effective July 15, 2020.

Compiler’s Notes.

This section was formerly compiled as KRS 11.501 .

42.722. Definitions for KRS 42.720 to 42.742.

As used in KRS 42.720 to 42.742 :

  1. “Communications” or “telecommunications” means any transmission, emission, or reception of signs, signals, writings, images, and sounds of intelligence of any nature by wire, radio, optical, or other electromagnetic systems, and includes all facilities and equipment performing these functions;
  2. “Geographic information system” or “GIS” means a computerized database management system for the capture, storage, retrieval, analysis, and display of spatial or locationally defined data;
  3. “Information resources” means the procedures, equipment, and software that are designed, built, operated, and maintained to collect, record, process, store, retrieve, display, and transmit information, and associated personnel;
  4. “Information technology” means data processing and telecommunications hardware, software, services, supplies, facilities, maintenance, and training that are used to support information processing and telecommunications systems to include geographic information systems;
  5. “Personal information” has the same meaning as in KRS 61.931 ;
  6. “Project” means a program to provide information technologies support to functions within an executive branch state agency, which should be characterized by well-defined parameters, specific objectives, common benefits, planned activities, expected outcomes and completion dates, and an established budget with a specified source of funding;
  7. “Security breach” has the same meaning as in KRS 61.931 ; and
  8. “Technology infrastructure” means any computing equipment, servers, networks, storage, desktop support, telephony, enterprise shared systems, information technology security, disaster recovery, business continuity, database administration, and software licensing.

History. Enact. Acts 2000, ch. 506, § 2, effective July 14, 2000; 2000, ch. 536, § 2, effective July 14, 2000; repealed, reenact. and amend., Acts 2009, ch. 12, § 3, effective June 25, 2009; 2014, ch. 89, § 9, effective July 15, 2014; ch. 138, § 2, effective July 15, 2014, ch. 74, § 5, effective January 1, 2015.

Compiler’s Notes

This section was formerly compiled as KRS 11.503 .

Legislative Research Commission Note.

(1/1/2015). 2014 Ky. Acts ch. 74, sec. 10 provided that “the provisions of this Act shall not impact the provisions of KRS 61.870 to 61.884 .” That proviso applies to this statute as amended in Section 5 of that Act.

(1/1/2015) This statute was amended by 2014 Ky. Acts chs. 74, 89, and 138, which do not appear to be in conflict and have been codified together.

42.724. Commonwealth Office of Technology.

  1. There is hereby created within the Finance and Administration Cabinet an agency of state government known as the Commonwealth Office of Technology.
  2. The Commonwealth Office of Technology shall be headed by an executive director, also known as the chief information officer, appointed by the secretary of the Finance and Administration Cabinet and approved by the Governor. Duties and functions of the executive director shall include serving on the Governor’s Executive Cabinet and those established in KRS 42.730 .
  3. The Commonwealth Office of Technology shall consist of the following offices, each headed by an executive director and organized into divisions headed by a division director:
    1. Office of Infrastructure Services, consisting of the:
      1. Division of Network Services; and
      2. Division of Platform Services;
    2. Office of Architecture and Governance, consisting of the:
      1. Division of Enterprise Solutions;
      2. Division of Mainframe Services;
      3. Division of Geographic Information Systems; and
      4. Division of Governance and Strategy;
    3. Office of the Chief Information Security Officer. The office shall ensure the efficiency and effectiveness of information technology security functions and responsibilities; and
    4. Office of Client Support Services, consisting of the:
      1. Division of Field Services; and
      2. Division of Support Services.
  4. Executive directors and division directors appointed under this section shall be appointed by the secretary with the approval of the Governor.

History. Enact. Acts 2000, ch. 506, § 3, effective July 14, 2000; 2000, ch. 536, § 3, effective July 14, 2000; 2001, ch. 59, § 1, effective June 21, 2001; 2005, ch. 85, § 22, effective June 20, 2005; repealed, reenact. and amend., Acts 2009, ch. 12, § 4, effective June 25, 2009; 2012, ch. 69, § 8, effective July 12, 2012; 2014, ch. 89, § 10, effective July 15, 2014; ch. 138, § 3, effective July 15, 2014; 2018 ch. 78, § 2, effective July 14, 2018; 2021 ch. 81, § 3, effective June 29, 2021.

Compiler’s Notes.

This section was formerly compiled as KRS 11.505 .

42.726. Roles, duties, and permissible activities for Commonwealth Office of Technology — Duties of Archives and Records Commission and Department for Libraries and Archives not affected — Annual report concerning security breaches.

  1. The Commonwealth Office of Technology shall be the lead organizational entity within the executive branch regarding delivery of information technology services, including application development and delivery, and shall serve as the single information technology authority for the Commonwealth.
  2. The roles and duties of the Commonwealth Office of Technology shall include but not be limited to:
    1. Providing technical support and services to all executive agencies of state government in the application of information technology;
    2. Assuring compatibility and connectivity of Kentucky’s information systems;
    3. Developing strategies and policies to support and promote the effective applications of information technology within state government as a means of saving money, increasing employee productivity, and improving state services to the public, including electronic public access to information of the Commonwealth;
    4. Developing, implementing, and managing strategic information technology directions, standards, and enterprise architecture, including implementing necessary management processes to assure full compliance with those directions, standards, and architecture;
    5. Promoting effective and efficient design and operation of all major information resources management processes for executive branch agencies, including improvements to work processes;
    6. Developing, implementing, and maintaining the technology infrastructure of the Commonwealth and all related support staff, planning, administration, asset management, and procurement for all executive branch cabinets and agencies except:
      1. Agencies led by a statewide elected official;
      2. The nine (9) public institutions of postsecondary education;
      3. The Department of Education’s services provided to local school districts;
      4. The Kentucky Retirement Systems, the County Employees Retirement System, the Kentucky Public Pensions Authority, and the Teachers’ Retirement System;
      5. The Kentucky Housing Corporation;
      6. The Kentucky Lottery Corporation;
      7. The Kentucky Higher Education Student Loan Corporation; and
      8. The Kentucky Higher Education Assistance Authority;
    7. Facilitating and fostering applied research in emerging technologies that offer the Commonwealth innovative business solutions;
    8. Reviewing and overseeing large or complex information technology projects and systems for compliance with statewide strategies, policies, and standards, including alignment with the Commonwealth’s business goals, investment, and other risk management policies. The executive director is authorized to grant or withhold approval to initiate these projects;
    9. Integrating information technology resources to provide effective and supportable information technology applications in the Commonwealth;
    10. Establishing a central statewide geographic information clearinghouse to maintain map inventories, information on current and planned geographic information systems applications, information on grants available for the acquisition or enhancement of geographic information resources, and a directory of geographic information resources available within the state or from the federal government;
    11. Coordinating multiagency information technology projects, including overseeing the development and maintenance of statewide base maps and geographic information systems;
    12. Providing access to both consulting and technical assistance, and education and training, on the application and use of information technologies to state and local agencies;
    13. In cooperation with other agencies, evaluating, participating in pilot studies, and making recommendations on information technology hardware and software;
    14. Providing staff support and technical assistance to the Geographic Information Advisory Council and the Kentucky Information Technology Advisory Council;
    15. Overseeing the development of a statewide geographic information plan with input from the Geographic Information Advisory Council;
    16. Developing for state executive branch agencies a coordinated security framework and model governance structure relating to the privacy and confidentiality of personal information collected and stored by state executive branch agencies, including but not limited to:
      1. Identification of key infrastructure components and how to secure them;
      2. Establishment of a common benchmark that measures the effectiveness of security, including continuous monitoring and automation of defenses;
      3. Implementation of vulnerability scanning and other security assessments;
      4. Provision of training, orientation programs, and other communications that increase awareness of the importance of security among agency employees responsible for personal information; and
      5. Development of and making available a cyber security incident response plan and procedure; and
    17. Preparing proposed legislation and funding proposals for the General Assembly that will further solidify coordination and expedite implementation of information technology systems.
  3. The Commonwealth Office of Technology may:
    1. Provide general consulting services, technical training, and support for generic software applications, upon request from a local government, if the executive director finds that the requested services can be rendered within the established terms of the federally approved cost allocation plan;
    2. Promulgate administrative regulations in accordance with KRS Chapter 13A necessary for the implementation of KRS 42.720 to 42.742 , 45.253 , 171.420 , 186A.040 , and 186A.285 ;
    3. Solicit, receive, and consider proposals from any state agency, federal agency, local government, university, nonprofit organization, private person, or corporation;
    4. Solicit and accept money by grant, gift, donation, bequest, legislative appropriation, or other conveyance to be held, used, and applied in accordance with KRS 42.720 to 42.742 , 45.253 , 171.420 , 186A.040 , and 186A.285 ;
    5. Make and enter into memoranda of agreement and contracts necessary or incidental to the performance of duties and execution of its powers, including, but not limited to, agreements or contracts with the United States, other state agencies, and any governmental subdivision of the Commonwealth;
    6. Accept grants from the United States government and its agencies and instrumentalities, and from any source, other than any person, firm, or corporation, or any director, officer, or agent thereof that manufactures or sells information resources technology equipment, goods, or services. To these ends, the Commonwealth Office of Technology shall have the power to comply with those conditions and execute those agreements that are necessary, convenient, or desirable; and
    7. Purchase interest in contractual services, rentals of all types, supplies, materials, equipment, and other services to be used in the research and development of beneficial applications of information resources technologies. Competitive bids may not be required for:
      1. New and emerging technologies as approved by the executive director or her or his designee; or
      2. Related professional, technical, or scientific services, but contracts shall be submitted in accordance with KRS 45A.690 to 45A.725 .
  4. Nothing in this section shall be construed to alter or diminish the provisions of KRS 171.410 to 171.740 or the authority conveyed by these statutes to the Archives and Records Commission and the Department for Libraries and Archives.
  5. The Commonwealth Office of Technology shall, on or before October 1 of each year, submit to the Legislative Research Commission a report in accordance with KRS 57.390 detailing:
    1. Any security breaches that occurred within organizational units of the executive branch of state government during the prior fiscal year that required notification to the Commonwealth Office of Technology under KRS 61.932 ;
    2. Actions taken to resolve the security breach, and to prevent additional security breaches in the future;
    3. A general description of what actions are taken as a matter of course to protect personal data from security breaches; and
    4. Any quantifiable financial impact to the agency reporting a security breach.

HISTORY: Enact. Acts 2000, ch. 506, § 4, effective July 14, 2000; 2000, ch. 536, § 4, effective July 14, 2000; 2005, ch. 85, § 30, effective June 20, 2005; 2005, ch. 99, § 4, effective June 20, 2005; 2006, ch. 193, § 10, effective July 12, 2006; repealed, reenact. and amend., Acts 2009, ch. 12, § 5, effective June 25, 2009; 2012, ch. 69, § 9, effective July 12, 2012; 2014, ch. 89, § 11, effective July 15, 2014; ch. 138, § 4, effective July 15, 2014; ch 74, § 6, effective January 1, 2015; 2018 ch. 78, § 3, effective July 14, 2018; 2020 ch. 36, § 3, effective July 15, 2020; 2020 ch. 79, § 16, effective April 1, 2021.

Legislative Research Commission Notes.

(4/1/2021). This statute was amended by 2020 Ky. Acts chs. 36 and 79, which do not appear to be in conflict and have been codified together.

(1/1/2015). 2014 Ky. Acts ch. 74, sec. 10 provided that “the provisions of this Act shall not impact the provisions of KRS 61.870 to 61.884 .” That proviso applies to this statute as amended in Section 6 of that Act.

42.728. State agencies to assist Commonwealth Office of Technology — Exceptions for judicial and legislative branches and retirement systems.

  1. To accomplish the work of the Commonwealth Office of Technology, all organizational units and administrative bodies, as defined in KRS 12.010 , and all members of the state postsecondary education system, as defined in KRS 164.001, shall furnish the Commonwealth Office of Technology necessary assistance, resources, information, records, and advice as required.
  2. The provisions of KRS 42.720 to 42.742 , 45.253 , 171.420 , 186A.040 , and 186A.285 shall not be construed to grant any authority over the judicial or legislative branches of state government, or agencies thereof, to the Commonwealth Office of Technology.
  3. The information, technology, personnel, agency resources, and confidential records of the Kentucky Retirement Systems, the County Employees Retirement System, the Kentucky Public Pensions Authority, and the Kentucky Teachers’ Retirement System shall be excluded from the provisions of KRS 42.720 to 42.742 , 45.253 , 171.420 , 186A.040 , and 186A.285 and shall not be under the authority of the Commonwealth Office of Technology.

History. Enact. Acts 2000, ch. 506, § 5, effective July 14, 2000; 2000, ch. 536, § 5, effective July 14, 2000; 2005, ch. 85, § 31, effective June 20, 2005; 2005, ch. 99, § 5, effective June 20, 2005; repealed, reenact. and amend., Acts 2009, ch. 12, § 6, effective June 25, 2009; 2020 ch. 36, § 4, effective July 15, 2020; 2020 ch. 79, § 17, effective April 1, 2021.

Compiler’s Notes.

This section was formerly compiled as KRS 11.509 .

Legislative Research Commission Notes.

(4/1/2021). This statute was amended by 2020 Ky. Acts chs. 36 and 79, which do not appear to be in conflict and have been codified together.

42.730. Executive Director of Commonwealth Office of Technology — Roles and duties.

  1. The executive director of the Commonwealth Office of Technology shall be the principal adviser to the Governor and the executive cabinet on information technology policy, including policy on the acquisition and management of information technology and resources.
  2. The executive director of the Commonwealth Office of Technology shall also serve as the chief information officer for all agencies within the executive branch, including the Commonwealth Office of Technology.
  3. The executive director shall carry out functions necessary for the efficient, effective, and economical administration of information technology and resources within the executive branch. Roles and duties of the executive director shall include but not be limited to:
    1. Assessing, recommending, and implementing information technology governance and organization design to include effective information technology personnel management practices;
    2. Integrating information technology and resources plans with agency business plans;
    3. Overseeing shared Commonwealth information technology resources and services;
    4. Performing as the focal point and representative for the Commonwealth in information technology and related areas with both the public and private sector;
    5. Establishing appropriate partnerships and alliances to support the effective implementation of information technology projects in the Commonwealth;
    6. Identifying information technology applications that should be statewide in scope, and assisting agencies in avoiding duplicate services;
    7. Establishing performance measurement and benchmarking policies and procedures;
    8. Preparing annual reports and plans concerning the status and result of the state’s specific information technology plans and submitting these annual reports and plans to the Governor and the General Assembly;
    9. Managing the Commonwealth Office of Technology and its budget; and
    10. Approving technology acquisition prior to any procurement.

HISTORY: Enact. Acts 1998, ch. 353, § 2, effective July 15, 1998; repealed, reenact., and amend. Acts 2000, ch. 506, § 6, effective July 14, 2000; 2000, ch. 536, § 6, effective July 14, 2000; 2005, ch. 85, § 23, effective June 20, 2005; repealed and reenact., Acts 2009, ch. 12, § 7, effective June 25, 2009; 2011, ch. 75, § 3, effective March 16, 2011; 2018 ch. 78, § 4, effective July 14, 2018.

Compiler's Notes.

This section was formerly compiled as KRS 11.511 .

42.732. Kentucky Information Technology Advisory Council — Purposes — Members.

  1. There is hereby created the Kentucky Information Technology Advisory Council to:
    1. Advise the executive director of the Commonwealth Office of Technology on approaches to coordinating information technology solutions among libraries, public schools, local governments, universities, and other public entities;
    2. Advise the executive director of the Commonwealth Office of Technology on coordination among and across the organizational units of the executive branch of state government to prepare for, respond to, and prevent attacks; and
    3. Provide a forum for the discussion of emerging technologies that enhance electronic accessibility to various publicly funded sources of information and services.
  2. The Kentucky Information Technology Advisory Council shall consist of:
    1. The state budget director or a designee;
    2. The state librarian or a designee;
    3. One (1) representative from the public universities to be appointed by the Governor from a list of three (3) persons submitted by the Council on Postsecondary Education;
    4. Three (3) citizen members from the private sector with information technology knowledge and experience appointed by the Governor;
    5. Two (2) representatives of local government appointed by the Governor;
    6. One (1) representative from the area development districts appointed by the Governor from a list of names submitted by the executive directors of the area development districts;
    7. One (1) member of the media appointed by the Governor;
    8. The executive director of the Kentucky Authority for Educational Television;
    9. The chair of the Public Service Commission or a designee;
    10. Two (2) members of the Kentucky General Assembly, one (1) from each chamber, selected by the Legislative Research Commission;
    11. One (1) representative of the Administrative Office of the Courts;
    12. One (1) representative from the public schools system appointed by the Governor;
    13. One (1) representative of the Kentucky Chamber of Commerce;
    14. The executive director of the Commonwealth Office of Technology; and
    15. The executive director of the Kentucky Communications Network Authority or designee.
  3. Appointed members of the council shall serve for a term of two (2) years. Members who serve by virtue of an office shall serve on the council while they hold the office.
  4. Vacancies on the council shall be filled in the same manner as the original appointments. If a nominating organization changes its name, its successor organization having the same responsibilities and purposes shall be the nominating organization.
  5. Members shall receive no compensation but shall receive reimbursement for actual and necessary expenses in accordance with travel and subsistence requirements established by the Finance and Administration Cabinet.

History. Enact. Acts 2000, ch. 506, § 7, effective July 14, 2000; ch. 5236, § 7, effective July 14, 2000; 2005, ch. 85, § 32, effective June 20, 2005; repealed and reenacted., Acts 2009, ch. 12, § 8, effective June 25, 2009; 2014, ch. 74, § 7, effective January 1, 2015.; 2017 ch. 89, § 6, effective June 29, 2017.

Legislative Research Commission Note.

(1/1/2015). 2014 Ky. Acts ch. 74, sec. 10 provided that “the provisions of this Act shall not impact the provisions of KRS 61.870 to 61.884 .” That proviso applies to this statute as amended in Section 7 of that Act.

42.734. Kentucky Wireless Interoperability Executive Committee created.

The Kentucky Wireless Interoperability Executive Committee is hereby created to address communications interoperability, a homeland security issue which is critical to the ability of public safety first responders to communicate with each other by radio. The committee shall advise and make recommendations to the executive director of the Commonwealth Office of Technology regarding strategic wireless initiatives to achieve public safety voice and data communications interoperability.

History. Enact. Acts 2003, ch. 164, § 1, effective June 24, 2003; 2005, ch. 85, § 34, effective June 20, 2005; repealed and reenact., Acts 2009, ch. 12, § 10, effective June 25, 2009.

Compiler’s Notes.

This section was formerly compiled as KRS 11.5161 .

42.736. Definitions for KRS 42.734, 42.736, and 42.738.

As used in this section and KRS 42.734 and 42.738 , unless the context requires otherwise:

  1. “Architecture” means the design principles, physical structure, and functional organization of a land mobile radio system;
  2. “Frequency” means for a periodic function, the number of cycles or events per unit time that comprises the frequency spectrum used by or assigned to a wireless public safety voice or data communications system;
  3. “Interoperability” means:
    1. The ability of public safety agencies to be able to communicate with one another; to exchange voice or data with one another in real time;
    2. The ability of systems, units, or forces to provide services to and accept services from other systems, units, or forces and to use the services so exchanged to enable them to operate effectively together; and
    3. The condition achieved among communications-electronics systems or items of communications-electronic equipment when information or services can be exchanged directly and satisfactorily between them and their users;
  4. “Primary wireless public safety voice or data communications systems” means a regular interacting group of base, mobile, and associated control and fixed relay stations intended to provide land mobile radio voice or data communications service over a single area of operation for public safety agencies. This definition shall not include “911” telephone systems;
  5. “Public safety shared infrastructure” means any component that by the nature of its function or physical characteristics can be used by multiple agencies to implement or support primary wireless public safety voice or data communications systems. This shall include but not be limited to towers, equipment shelters, radios, and other electronic equipment, backbone communications networks, and communications-related software;
  6. “Public safety working group” means a working group whose mission is to design and develop a seamless coordinated plan for the use of the public safety frequency spectrum as regulated by the Federal Communications Commission;
  7. “Spectrum” means a usable radio frequency in the electromagnetic distribution; and
  8. “Standards” means:
    1. Engineering and technical requirements that are necessary to be employed in the design of systems, units, or forces and to use the services so exchanged to enable them to operate effectively together, including but not limited to operating frequencies, over-the-air protocols, and bandwidth; and
    2. Established protocol that provides a common interface.

History. Enact. Acts 2003, ch. 164, § 2, effective June 24, 2003; 2004, ch. 48, § 1, effective July 13, 2004; repealed, reenact. and amend., Acts 2009, ch. 12, § 11, effective June 25, 2009.

Compiler’s Notes.

This section was formerly compiled as KRS 11.5162 .

42.738. Statewide public safety interoperability plan — Annual report by executive director— Duties of Kentucky Wireless Interoperability Executive Committee — Membership — Public Safety Working Group.

  1. The executive director shall establish and implement a statewide public safety interoperability plan. This plan shall include the development of required architecture and standards that will insure that new or upgraded Commonwealth public safety communications systems will interoperate. The Kentucky Wireless Interoperability Executive Committee shall be responsible for the evaluation and recommendation of all wireless communications architecture, standards, and strategies. The executive director shall provide direction, stewardship, leadership, and general oversight of information technology and information resources. The executive director shall report by September 15 annually to the Interim Joint Committee on Seniors, Veterans, Military Affairs, and Public Protection and the Interim Joint Committee on State Government on progress and activity by agencies of the Commonwealth to comply with standards to achieve public safety communications interoperability.
  2. The Kentucky Wireless Interoperability Executive Committee shall serve as the advisory body for all wireless communications strategies presented by agencies of the Commonwealth and local governments. All state agencies in the Commonwealth shall present all project plans for primary wireless public safety voice or data communications systems for review and recommendation by the committee, and the committee shall forward the plans to the executive director for final approval. Local government entities shall present project plans for primary wireless public safety voice or data communications systems for review and recommendation by the Kentucky Wireless Interoperability Executive Committee.
  3. The committee shall develop funding and support plans that provide for the maintenance of and technological upgrades to the public safety shared infrastructure, and shall make recommendations to the executive director, the Governor’s Office for Policy and Management, and the General Assembly.
  4. The executive director shall examine the project plans for primary wireless public safety voice or data communications systems of state agencies as required by subsection (2) of this section, and shall determine whether they meet the required architecture and standards for primary wireless public safety voice or data communications systems.
  5. The Kentucky Wireless Interoperability Executive Committee shall consist of twenty (20) members as follows:
    1. A person knowledgeable in the field of wireless communications appointed by the executive director who shall serve as chair;
    2. The executive director of the Office of Infrastructure Services, Commonwealth Office of Technology;
    3. The executive director of Kentucky Educational Television, or the executive director’s designee;
    4. The information technology lead of the Transportation Cabinet;
    5. The information technology lead of the Justice and Public Safety Cabinet;
    6. The information technology lead of the Department of Kentucky State Police;
    7. The commissioner of the Department of Fish and Wildlife Resources, or the commissioner’s designee;
    8. The information technology lead of the Energy and Environment Cabinet;
    9. The director of the Division of Emergency Management, Department of Military Affairs;
    10. The executive director of the Kentucky Office of Homeland Security;
    11. The information technology lead of the Department for Public Health, Cabinet for Health and Family Services;
    12. A representative from an institution of postsecondary education appointed by the Governor from a list of three (3) names submitted by the president of the Council on Postsecondary Education;
    13. The executive director of the Center for Rural Development, or the executive director’s designee;
    14. A representative from a municipal government to be appointed by the Governor from a list of three (3) names submitted by the Kentucky League of Cities;
    15. A representative from a county government to be appointed by the Governor from a list of three (3) names submitted by the Kentucky Association of Counties;
    16. A representative from a municipal police department to be appointed by the Governor from a list of three (3) names submitted by the Kentucky Association of Chiefs of Police;
    17. A representative from a local fire department to be appointed by the Governor from a list of three (3) names submitted by the Kentucky Association of Fire Chiefs;
    18. A representative from a county sheriff’s department to be appointed by the Governor from a list of three (3) names submitted by the Kentucky Sheriffs’ Association;
    19. A representative from a local Emergency Medical Services agency to be appointed by the Governor from a list of three (3) names submitted by the Kentucky Board of Emergency Medical Services; and
    20. A representative from a local 911 dispatch center to be appointed by the Governor from a list of three (3) names submitted by the Kentucky Chapter of the National Emergency Number Association/Association of Public Safety Communications Officials.
  6. Appointed members of the committee shall serve for a two (2) year term. Members who serve by virtue of an office shall serve on the committee while they hold that office.
  7. The committee shall meet quarterly, or as often as necessary for the conduct of its business. A majority of the members shall constitute a quorum for the transaction of business. Members’ designees shall have voting privileges at committee meetings.
  8. The committee shall be attached to the Commonwealth Office of Technology for administrative purposes only. Members shall not be paid and shall not be reimbursed for travel expenses.
  9. The Public Safety Working Group is hereby created for the primary purpose of fostering cooperation, planning, and development of the public safety frequency spectrum as regulated by the Federal Communications Commission, including the 700 MHz public safety band. The group shall endeavor to bring about a seamless, coordinated, and integrated public safety communications network for the safe, effective, and efficient protection of life and property. The Public Safety Working Group membership and other working group memberships deemed necessary shall be appointed by the chair of the Kentucky Wireless Interoperability Executive Committee.
  10. The committee may establish additional working groups as determined by the committee.

History. Enact. Acts 2003, ch. 164, § 3, effective June 24, 2003; 2004, ch. 48, § 2, effective July 13, 2004; 2005, ch. 85, § 35, effective June 20, 2005; 2005, ch. 95, § 6, effective June 20, 2005; 2005, ch. 99, § 74, effective June 20, 2005; 2006, ch. 193, § 8, effective July 12, 2006; 2007, ch. 85, § 6, effective June 26, 2007; repealed, reenact. and amend., Acts 2009, ch. 12, § 12, effective June 25, 2009; 2010, ch. 24, § 34, effective July 15, 2010; 2018 ch. 78, § 5, effective July 14, 2018; 2021 ch. 81, § 5, effective June 29, 2021.

Compiler’s Notes.

This section was formerly compiled as KRS 11.5163 .

Legislative Research Commission Notes.

(7/13/2004). In subsection (5)(i) of this statute, a reference to “the Department of Emergency Management” has been changed to read “the Division of Emergency Management” to reflect the correct structure of the Department of Military Affairs. The Reviser of Statutes has corrected this manifest clerical error under the authority of KRS 7.136(1)(h).

42.740. Geographic Information Advisory Council — Purpose — Members — Conflicts of interest.

  1. There is hereby established a Geographic Information Advisory Council, attached to the Commonwealth Office of Technology for administrative purposes, to advise the executive director of the Commonwealth Office of Technology on issues relating to geographic information and geographic information systems.
  2. The council shall recommend policies and procedures that assist state and local jurisdictions in developing, deploying, and leveraging geographic information resources and geographic information systems technology for the purpose of improving public administration.
  3. The council shall closely coordinate with users of geographic information systems to recommend policies and procedures that ensure the maximum use of geographic information by minimizing the redundancy of geographic information and geographic information resources.
  4. The Geographic Information Advisory Council shall consist of twenty-six (26) members and one (1) legislative liaison. The members shall be knowledgeable in the use and application of geographic information systems technology and shall have sufficient authority within their organizations to influence the implementation of council recommendations.
    1. The council shall consist of:
      1. The secretary of the Transportation Cabinet or his or her designee;
      2. The secretary of the Cabinet for Health and Family Services or his or her designee;
      3. The director of the Kentucky Geological Survey or his or her designee;
      4. The secretary of the Finance and Administration Cabinet or his or her designee;
      5. The executive director of the Commonwealth Office of Technology or her or his designee, who shall serve as chair;
      6. The secretary of the Economic Development Cabinet or his or her designee;
      7. The commissioner of the Department for Local Government or his or her designee;
      8. The secretary of the Justice and Public Safety Cabinet or his or her designee;
      9. One (1) member appointed by the Governor from a list of three (3) persons submitted by the president of the Council on Postsecondary Education;
      10. The adjutant general of the Department of Military Affairs or his or her designee;
      11. The commissioner of the Department of Education or his or her designee;
      12. The secretary of the Energy and Environment Cabinet or his or her designee;
      13. The Commissioner of the Department of Agriculture or his or her designee;
      14. The secretary of the Tourism, Arts and Heritage Cabinet or his or her designee;
      15. Two (2) members appointed by the Governor from a list of six (6) persons submitted by the president of the Kentucky League of Cities;
      16. Two (2) members appointed by the Governor from a list of six (6) persons submitted by the president of the Kentucky Association of Counties;
      17. One (1) member appointed by the Governor from a list of three (3) persons submitted by the president of the Kentucky Chapter of the American Planning Association;
      18. One (1) member appointed by the Governor from a list of three (3) persons submitted by the president of the Kentucky Chamber of Commerce;
      19. One (1) member appointed by the Governor from a list of three (3) persons submitted by the president of the Kentucky Association of Professional Surveyors;
      20. One (1) member appointed by the Governor from a list of three (3) persons submitted by the president of the Kentucky Society of Professional Engineers;
      21. One (1) member appointed by the Governor from a list of three (3) persons submitted by the chairman of the Kentucky Board of Registered Geologists;
      22. One (1) member appointed by the Governor from a list of three (3) persons submitted by the president of the Council of Area Development Districts;
      23. One (1) member appointed by the Governor from a list of three (3) persons submitted by the president of the Kentucky Association of Mapping Professionals; and
      24. The executive director of the Kentucky Office of Homeland Security.
    2. The council shall have one (1) nonvoting legislative liaison, to be appointed by the Legislative Research Commission.
  5. The council may have committees and subcommittees as determined by the council or an executive committee, if an executive committee exists.
  6. A member of the council shall not:
    1. Be an officer, employee, or paid consultant of a business entity that has, or of a trade association for business entities that have, a substantial interest in the geographic information industry and is doing business in the Commonwealth;
    2. Own, control, or have, directly or indirectly, more than ten percent (10%) interest in a business entity that has a substantial interest in the geographic information industry;
    3. Be in any manner connected with any contract or bid for furnishing any governmental body of the Commonwealth with geographic information systems, the computers on which they are automated, or a service related to geographic information systems;
    4. Be a person required to register as a lobbyist because of activities for compensation on behalf of a business entity that has, or on behalf of a trade association of business entities that have, substantial interest in the geographic information industry;
    5. Accept or receive money or another thing of value from an individual, firm, or corporation to whom a contract may be awarded, directly or indirectly, by rebate, gift, or otherwise; or
    6. Be liable to civil action or any action performed in good faith in the performance of duties as a council member.
  7. Those council members specified in subsection (4)(a) of this section who serve by virtue of an office shall serve on the board while they hold that office.
  8. Appointed members of the council shall serve for a term of four (4) years. Vacancies in the membership of the council shall be filled in the same manner as the original appointments. If a nominating organization changes its name, its successor organization having the same responsibilities and purposes shall be the nominating organization.
  9. The council shall have no funds of its own, and council members shall not receive compensation of any kind from the council.
  10. A majority of the members shall constitute a quorum for the transaction of business. Members’ designees shall have voting privileges at council meetings.

History. Enacts. Acts 1994, ch. 327, § 4, effective July 15, 1994; 1997 (Ex. Sess.), ch. 1, § 40, effective May 30, 1997; 1998, ch. 48, § 4, effective July 15, 1998; 1998, ch. 69, § 23, effective July 15, 1998; 1998, ch. 426, § 87, effective July 15, 1998; repealed, reenact., and amend. Acts 2000, ch. 506, § 8, effective July 14, 2000; 2000, ch. 536, § 8, effective July 14, 2000; 2005, ch. 85, § 33 effective June 20, 2005; 2005, ch. 95, § 5, effective June 20, 2005; 2005, ch. 99, § 6, effective June 20, 2005; 2005, ch. 123, § 6, effective June 20, 2005; 2007, ch. 47, § 5, effective June 26, 2007; 2007, ch. 85, § 5, effective June 26, 2007; repealed, reenact. and amend., Acts 2009, ch. 12, § 9, effective June 25, 2009; 2009, ch. 16, § 2, effective June 25, 2009; 2010, ch. 24, § 35, effective July 15, 2010; 2010, ch. 117, § 31, effective July 15, 2010; 2012, ch. 69, § 10, effective July 12, 2012; 2019 ch. 139, § 1, effective June 27, 2019.

Compiler’s Notes.

This section was formerly compiled as KRS 11.515 .

42.742. Duties of Geographic Information Advisory Council.

  1. The Geographic Information Advisory Council’s duties shall include the following:
    1. Recommending the development and adoption of policies and procedures related to geographic information and geographic information systems;
    2. Providing input and recommendations for the development of a strategy for the maintenance and funding of a statewide base map and geographic information system;
    3. Recommending standards on geographic information and geographic information systems for inclusion in the statewide architecture;
    4. Contributing to the development and delivery of a statewide geographic information plan;
    5. Overseeing the development of operating policies and procedures for the management of the council and any standing or ad hoc committees and associated advisory groups; and
    6. Promoting collaboration and the sharing of data and data development, as well as other aspects of geographic information systems.
  2. The Division of Geographic Information Systems shall provide necessary staff support services to the council. All cabinets, departments, divisions, agencies, and officers of the Commonwealth shall furnish the council necessary assistance, resources, information, records, or advice as it may require to fulfill its duties.

History. Enact. Acts 1994, ch. 327, § 5, effective July 15, 1994; repealed, reenact., and amend. Acts 2000, ch. 506, § 9, effective July 14, 2000; 2000, ch. 536, § 9, effective July 14, 2000; 2005, ch. 85, § 36, effective June 20, 2005; repealed, reenact. and amend., Acts 2009, ch. 12, § 13, effective June 25, 2009; 2012, ch. 69, § 11, effective July 12, 2012; 2018 ch. 78, § 6, effective July 14, 2018; 2021 ch. 81, § 6, effective June 29, 2021.

Compiler’s Notes.

This section was formerly compiled as KRS 11.517 .

42.744. Addition of nonlicensed raster-based datasets of publicly funded Kentucky locations to the Geospatial Data Warehouse — Exceptions — Confidentiality.

  1. All entities in Kentucky that create or purchase digital ortho-rectified aerial imagery, remotely sensed imagery, LiDAR, digital elevation models, or any other form of nonlicensed raster-based datasets of locations in Kentucky using public funds, in whole or in part, shall provide a copy of the information to the Commonwealth Office of Technology, Division of Geographic Information Systems, without cost, in order to allow the Commonwealth Office of Technology to effectively discharge its statutory responsibility to maintain an accurate and complete central statewide geographic information clearinghouse for official state use. The imagery provided to the Commonwealth Office of Technology shall be added to Kentucky’s secure Geospatial Data Warehouse for official government use only.
  2. Subsection (1) of this section shall not apply to roads, land parcels, structure locations, or other vector-based datasets acquired with public funding.
  3. The Commonwealth Office of Technology shall not disclose to the general public or make available for distribution, download, or purchase any data that an entity providing data under subsection (1) of this section has requested remain confidential.

History. Enact. Acts 2006, ch. 206, § 1, effective July 12, 2006; repealed and reenact., Acts 2009, ch. 12, § 14, effective June 25, 2009; 2012, ch. 69, § 12, effective July 12, 2012; 2018 ch. 78, § 7, effective July 14, 2018; 2021 ch. 81, § 7, effective June 29, 2021.

Compiler’s Notes.

This section was formerly compiled as KRS 11.518 .

42.746. Statewide planning and mapping system for public buildings.

  1. To the extent funds are made available, the Commonwealth Office of Technology shall establish a statewide planning and mapping system for public buildings in this state for use by response agencies who are called to respond to an act of terrorism or an emergency.
  2. The statewide planning and mapping system for public buildings shall include:
    1. Floor plans, fire protection information, building evacuation plans, utility information, known hazards, and information on how to contact emergency personnel;
    2. The manner by which the information required by paragraph (a) of this subsection shall be transferred to the system from state agencies and the local political subdivisions who participate in the system;
    3. Standards for the software that shall be used by state agencies and local political subdivisions that participate in the system;
    4. Conditions for use of the system by response agencies;
    5. Guidelines for:
      1. The accessibility and confidentiality of information contained within the system; and
      2. The incorporation, in connection with the use of the system, of the items described in subsection (3)(b) of this section;
    6. In accordance with information obtained by the Kentucky Office of Homeland Security, a priority for the distribution of any money that may be available for state agencies and political subdivisions to participate in the system; and
    7. Guidelines recommended by the Division of Emergency Management for the training of persons employed by the response agencies concerning the use of the system.
  3. To the extent money is available, state agencies and political subdivisions shall:
    1. Participate in the statewide planning and mapping system; and
    2. Incorporate into their use of the system, without limitation:
      1. Evacuation routes and strategies for evacuation;
      2. Alarms and other signals or means of notification;
      3. Plans for remaining inside a building, room, structure, or other location during an emergency when egress may be impossible or when egress may present a more substantial risk than remaining inside; and
      4. Training and strategies for prevention in connection with attacks involving violence.

        If a state agency or political subdivision uses its own planning and mapping system before the Commonwealth Office of Technology establishes a statewide planning and mapping system, the state agency or political subdivision may continue to use its system unless money is made available for the state agency or political subdivision to update or modify its system as necessary for inclusion in the statewide system.

  4. The Commonwealth Office of Technology:
    1. Shall pursue any money that may be available from the federal government for the development and operation of a statewide planning and mapping system for public buildings, and for the distribution of grants to state agencies and political subdivisions that participate in the system; and
    2. May accept gifts, grants, and contributions for the development and operation of a statewide planning and mapping system, and for the distribution of grants to the state agencies and political subdivisions that participate in the system.
  5. Each state agency and political subdivision that participates in the system shall, on or before July 1, 2007, and on or before July 1 of each year thereafter, submit to the Commonwealth Office of Technology a progress report setting forth, in accordance with regulations promulgated by the Commonwealth Office of Technology, the experience of the agency or political subdivision with respect to its participation in the system. The Commonwealth Office of Technology shall receive and process the progress reports, and provide a summarized overview of the system to the Legislative Research Commission on or before October 1, 2007, and on or before October 1 of each year thereafter.

History. Enact. Acts 2006, ch. 223, § 1, effective July 12, 2006; repealed and reenact., Acts 2009, ch. 12, § 15, effective June 25, 2009.

Compiler’s Notes.

This section was formerly compiled as KRS 11.520 .

Legislative Research Commission Note.

(7/12/2006). 2006 Ky. Acts ch. 193, sec. 14, instructs the Reviser of Statutes to correct statutory references to agencies and officers whose names have been changed in the Act, as it confirms reorganization within the executive branch and establishes the Kentucky Office of Homeland Security. Such a correction has been made in this section.

42.747. Blockchain Technology Working Group.

  1. As used in this section, unless the context otherwise requires:
    1. “Blockchain technology” means shared or distributed data structures or digital ledgers used in peer-to-peer networks that:
      1. Store digital transactions;
      2. Verify and secure transactions cryptographically; and
      3. Allow automated self-execution of smart contracts;
    2. “Peer-to-peer networks” means computer systems that are connected to each other over the Internet so that each computer system:
      1. Is a client and a server simultaneously; and
      2. Allows file sharing without use of a central server;
    3. “Smart contract” means a computerized transaction protocol that self- executes the terms of a contract and that is integrated into the blockchain program architecture; and
    4. “Contract” means an agreement of the parties in fact, as found in their language or inferred from other circumstances, including course of performance, course of dealing, or usage of trade, reached through offer and mutual acceptance by the parties to be legally bound by the terms of the agreement which includes valuable consideration for all parties.
  2. There is hereby established a Blockchain Technology Working Group which shall be attached to the Commonwealth Office of Technology for administrative purposes.
  3. The working group shall evaluate the feasibility and efficacy of using blockchain technology to enhance the security of and increase protection for the state’s critical infrastructure, including but not limited to the electric utility grid, natural gas pipelines, drinking water supply and delivery, wastewater, telecommunications, and emergency services. The workgroup shall create a priority list of critical infrastructure that could benefit from the use of blockchain technology and then determine whether:
    1. Blockchain fits the distributed nature of transactions;
    2. The peer-to-peer network is robust enough to support the use of blockchain technology;
    3. A cost-benefit analysis of blockchain for each case is warranted to demonstrate its value, applicability, or efficiency; and
    4. If the parties involved in the blockchain would agree to its usage if deployed.
  4. The workgroup shall consist of nine (9) members, three (3) of which shall be ex officio, as follows:
    1. The chief information officer for the Commonwealth Office of Technology or his or her designee who shall serve as chair;
    2. The secretary for the Energy and Environment Cabinet or his or her designee;
    3. The chief information officer for the Finance and Administration Cabinet or his or her designee;
    4. A representative designated by the executive director of the Kentucky Public Service Commission, who has knowledge of the spatial characteristics of the infrastructure used by public utilities;
    5. The executive director of Kentucky Department of Homeland Security or his or her designee;
    6. One (1) member in academia designated by the chief information officer of the Commonwealth Office of Technology, who has expertise in blockchain technology and its applicability to different industry sectors
    7. One (1) ex officio member representing the Kentucky Municipal Utilities Association (KMUA) designated by the executive director of KMUA;
    8. One (1) ex officio member representing the investor-owned electric utilities designated by the executive director of the Kentucky Public Service Commission; and
    9. One (1) ex officio member representing Kentucky electric cooperatives designated by the chairman of the board of the Kentucky Association of Electric Cooperatives.
  5. The workgroup shall be staffed by the Commonwealth Office of Technology.
  6. The workgroup shall report to the Governor and to the Legislative Research Commission by December 1 of each year. The report shall include the current priority list and a discussion of whether blockchain could be deployed, and any associated cost-benefit analysis.

HISTORY: 2020 ch. 108, § 1, effective July 15, 2020.

42.800. Kentucky Kare Health Insurance Authority — Board of directors — Executive director — Annual audit. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1998, ch. 82, § 6, effective July 15, 1998) was repealed by Acts 2001, ch. 164, § 18, effective June 21, 2001.

42.805. Kentucky Kare health insurance fund — Benefits — Contributions — Provisions of plan — Group rates for disabled children. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1998, ch. 82, § 7, effective July 15, 1998) was repealed by Acts 2001, ch. 164, § 18, effective June 21, 2001.

42.810. Duties of authority — Amounts credited to fund — Investment of fund — Annual report — Actuarial evaluation. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1998, ch. 82, § 8, effective July 15, 1998) was repealed by Acts 2001, ch. 164, § 18, effective June 21, 2001.

42.815. Self-funded health insurance fund not subject to certain taxes. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1998, ch. 82, § 9, effective July 15, 1998) was repealed by Acts 2001, ch. 164, § 18, effective June 21, 2001.

42.820. Authority determines date on which option is available. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1998, ch. 82, § 10, effective July 15, 1998) was repealed by Acts 2001, ch. 164, § 18, effective June 21, 2001.

42.825. Exclusion of coverage for employment-related conditions. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1998, ch. 82, § 11, effective July 15, 1998) was repealed by Acts 2001, ch. 164, § 18, effective June 21, 2001.

42.990. Penalties. [Repealed and reenacted.]

Compiler’s Notes.

This section (1992b-3: amend. Acts 1954, ch. 187, § 5; repealed and reen. Acts 1968, ch. 152, § 18; 1974, ch. 74, Art. II, § 9(1)) was repealed and reenacted as KRS 45.991 by Acts 1984, ch. 111, § 36, effective July 13, 1984.

CHAPTER 43 Auditor of Public Accounts

43.010. Definitions for chapter.

As used in this chapter, unless the context requires otherwise:

  1. “Auditor” means the Auditor of Public Accounts.
  2. “Budget unit” means a department or other unit of organization for which separate appropriations are made from those for any other organization unit.
  3. “State agency” means any state officer, department, board, commission, institution, division, or other person or functional group that is authorized to exercise or does exercise any executive or administrative jurisdiction, powers, duties, rights or obligations of the state government conferred or imposed by law or exercised, performed, or discharged by legal authority in compliance with law.
  4. “Writing” or “written” means letters, words, or numbers, or their equivalent, set down by handwriting, typewriting, printing, photostating, photographing, magnetic impulse, mechanical or electronic recording, or other form of data compilation.

History. 1992b-2, 4618-69; 1998, ch. 120, § 3, effective July 15, 1998.

NOTES TO DECISIONS

1.Budget Unit or State Agency.

A “budget unit” or “state agency” as defined under this section do not include the Kentucky Bar Association or Kentucky board of bar examiners since these organizations exist solely by virtue of the rules of the Kentucky Supreme Court which are expressly and exclusively authorized by Ky. Const., § 116. Ex parte Auditor of Public Accounts, 609 S.W.2d 682, 1980 Ky. LEXIS 274 ( Ky. 1980 ).

Opinions of Attorney General.

The Kentucky Horse Council (now Horse Park Commission) is an agency of state government and all of its funds from whatever source received, including private sources, contributions and membership fees, upon receipt become public funds of a state agency and are subject to all general constitutional and statutory provisions governing the audit, budgeting, accounting and expenditure of state funds. OAG 74-715 .

The Governor’s Council on Agriculture is a state agency and all funds received by it from whatever source must be handled and accounted for as state funds. OAG 75-62 .

The Kentucky Bar Association is not a state agency for the purpose of being subjected to an audit by the Auditor of Public Accounts pursuant to KRS Chapter 43 and since the Bar Association is not a state budget unit, its receipts do not have to be deposited to the State Treasury and its funds are not subject to appropriation by the General Assembly. OAG 80-393 .

The Auditor of Public Accounts has no right to conduct audits of circuit court clerks, as a permissive mandatory matter, if he is not statutorily required or permitted to conduct such audits; however in view of the direct involvement of the circuit clerks in putting money into the State Treasury and expending money coming out of the state treasury, and in view of the express language of KRS 43.050(2)(a) and this section, the auditor of public accounts is required to audit the circuit court clerks of Kentucky in the areas of state treasury involvement, within the practical capabilities of his staff and budget, and considering other mandatory audits. OAG 81-41 .

The Kentucky Center for the Arts Corporation does not have to deposit the moneys it receives in the State Treasury since it is not a budget unit of the Commonwealth, a budget unit being a department or other unit of organization for which separate appropriations are made from those for any other organization unit (KRS 41.010 , this section and 45.010 (repealed)). OAG 81-129 .

Research References and Practice Aids

Cross-References.

Accounts of Auditor to be audited by Finance and Administration Cabinet, KRS 45.301 .

Acts of General Assembly, Auditor to receive and take care of, KRS 57.300 , 57.360 .

Commission from Governor, KRS 61.020 .

Constitutional provisions as to Auditor, Ky. Const., §§ 53, 91, 93, 95, 96.

Treasurer, Auditor to examine accounts of and take inventory of books and office equipment, KRS 41.330 .

Treasurer, suspension of, duties of Auditor, KRS 41.050 .

Unsatisfied claims of commonwealth, Auditor to assist Attorney General and Revenue Cabinet to investigate, KRS 15.060 .

43.020. Location of office of Auditor.

The Auditor shall keep his or her office at the seat of government.

History. 138, 141: amend. Acts 1946, ch. 26, § 4; 1946, ch. 27, § 19; 1966, ch. 255, § 51; 2020 ch. 59, § 1, effective July 15, 2020.

Opinions of Attorney General.

The Constitution providing only that all state officers shall reside within the Commonwealth, a state officer residing within the State of Kentucky may legally reside, where commuting time is less than an hour, in another county other than at the seat of government. OAG 69-196 .

Research References and Practice Aids

Cross-References.

Bond of Auditor, amount and conditions, KRS 62.160 , 62.180 .

Election, term and qualifications of Auditor, Ky. Const., §§ 91, 93, 95.

Oath to be taken and bond given before entering on duties of office, KRS 62.010 , 62.050 .

Salary, KRS 64.480 .

43.030. Assistant auditor — Subordinate personnel — Qualifications.

  1. The Auditor shall appoint for the duration of his or her own term, subject to removal by the Auditor at any time, one (1) assistant auditor of public accounts, who shall be a certified public accountant and who has been a citizen and resident of the state for at least two (2) years. The assistant auditor shall have direct supervision over all technical work and technical assistants, and shall otherwise aid the Auditor in the performance of his or her duties, except that the assistant auditor of public accounts may exercise a full or partial recusal from this supervision requirement in regard to the consulting function authorized in KRS 43.050 if needed to comply with the professional standards of accountancy. If the Auditor is absent or is rendered incapable of performing his or her duties, or if a vacancy in the office occurs, the assistant auditor shall perform the duties of Auditor until the necessity therefor ceases to exist. He or she shall take the constitutional oath.
  2. The Auditor may employ other subordinate personnel subject to the provisions of KRS 12.060 . All employees with status as defined in KRS 18A.005 who are engaged in auditing or investigations shall possess a minimum of a four (4) year college degree. No less than ninety percent (90%) of all employees engaged in financial auditing or financial investigations shall have twenty (20) semester hours or thirty (30) quarter hours of accounting, or alternately, shall be a certified public accountant. Not more than two (2) persons charged with the conduct of audits and investigations may substitute year-for-year responsible experience acceptable to the Personnel Cabinet for the required college education and accounting hours.
  3. The Auditor and his or her sureties are liable on his or her official bond for the acts of the assistant auditor and clerks.
  4. Nothing in this section shall be deemed to affect the provisions of KRS 11.090 or other legislation authorizing audits.

History. 140 to 142, 147, 4618-137: amend. Acts 1946, ch. 27, § 44; 1956 (1st Ex. Sess.), ch. 7, Art. XI; 1968, ch. 152, § 19; 1976, ch. 329, § 1; 1980, ch. 177, § 1, effective July 15, 1980; 1998, ch. 39, § 1, effective July 15, 1998; 1998, ch. 154, § 63, effective July 15, 1998; 2019 ch. 18, § 1, effective June 27, 2019; 2020 ch. 59, § 2, effective July 15, 2020.

NOTES TO DECISIONS

1.Clerical Force.

A clerk appointed by the person holding the office of Auditor was entitled to hold the position for the four-year term of the Auditor, although the person making the appointment was subsequently held not to be the lawful incumbent of the Auditor’s office. Smith v. Coulter, 113 Ky. 74 , 67 S.W. 1, 23 Ky. L. Rptr. 2384 , 1902 Ky. LEXIS 11 ( Ky. 1902 ).

The term of a clerk appointed by the Auditor continues during the Auditor’s four-year term or balance thereof, unless the clerk is lawfully removed or abandons the position. Smith v. Coulter, 113 Ky. 74 , 67 S.W. 1, 23 Ky. L. Rptr. 2384 , 1902 Ky. LEXIS 11 ( Ky. 1902 ).

The selection of the clerical force necessary for the proper conduct of the business of the Auditor’s office, and the fixing of their respective salaries, is at the discretion of the auditor, but the aggregate of such salaries cannot exceed the amount appropriated for the purpose by the General Assembly. Bosworth v. Shuck, 118 Ky. 458 , 81 S.W. 240, 26 Ky. L. Rptr. 324 , 1904 Ky. LEXIS 57 ( Ky. 1904 ).

The Auditor is primarily liable to the state for loss occasioned by fraudulent acts of his clerks. Commonwealth use of Coleman v. Farmers Deposit Bank, 264 Ky. 839 , 95 S.W.2d 793, 1936 Ky. LEXIS 413 ( Ky. 1936 ).

Cited:

Hager v. Lucas, 120 Ky. 307 , 27 Ky. L. Rptr. 710 , 86 S.W. 552, 1905 Ky. LEXIS 104 ( Ky. 1905 ).

Research References and Practice Aids

Cross-References.

Bonds to be required of employees handling money or property, KRS 62.170 .

43.040. Duty of Auditor at end of term.

  1. Upon the expiration of the Auditor’s term of office, the Auditor shall file a certification of the inventory of the office with the Secretary of State and shall deliver the inventory to the Auditor’s successor.
  2. In the event of a vacancy in the office of Auditor, the assistant auditor of public accounts shall file a certification of the inventory of the office with the Secretary of State and shall deliver the inventory to the Auditor’s successor.

History. 141; 2020 ch. 59, § 3, effective July 15, 2020.

43.050. General functions of Auditor.

  1. The Auditor constitutes an agency independent of the administrative departments enumerated in KRS 12.020 , it being the policy of the General Assembly to provide for the independent auditing of the accounts, financial transactions, and performance of all spending agencies of the state through a disinterested auditor, who is entirely independent of the state administration whose affairs he is called upon to audit.
  2. The Auditor may:
    1. Audit annually, and at such other times as may be deemed expedient, the accounts of all state agencies, all private and semiprivate agencies receiving state aid or having responsibility for the handling of any state funds, the accounts, records, and transactions of the budget units, and the general accounts of the state;
    2. Make a complete audit and verification of all moneys handled for the account of the state government by local officials charged with the collection of fees or other money for or on behalf of the state, when an audit is demanded in writing by the Legislative Research Commission, the secretary of the Finance and Administration Cabinet, or the Governor, and may make an audit when it is not so demanded;
    3. Examine periodically the performance, management, conduct, and condition of all asylums, prisons, institutions for the intellectually disabled, and eleemosynary institutions; public works owned, operated, or partly owned by the state, or in the conduct or management of which the state has any financial interest or legal power; and state agencies. The examinations shall give special attention to the faithful and economical application of any money appropriated by the state to the institution, public works, or state agency examined, or of any money in which the state has an interest;
    4. Examine annually the management and condition of the offices of the Finance and Administration Cabinet, the State Treasurer, and the chief state school officer, to determine whether the laws regulating their duties are being fully complied with, and all money received by them for the state fully accounted for;
    5. Examine, at least biennially, the Finance and Administration Cabinet’s compliance with this section and KRS 48.111 and 56.800 to 56.823 . Within sixty (60) days of the completion of each examination, the Auditor shall report his findings and recommendations to the Capital Projects and Bond Oversight Committee;
    6. Audit periodically all state revenue collections, and, if he finds that collections are not being satisfactorily made, report that fact to the authority whose duty it is to make the collections;
    7. Make special audits and investigations when required by the Governor;
    8. Investigate the means of accounting for, controlling, and insuring the safe custody of all property of the state, and verify the existence and condition of such property charged to, or held in the custody of any state agency;
    9. Audit the statements of financial condition and operations of the state government, and certify in writing the results of the audit and examination with the comments he deems necessary for the information of the General Assembly;
    10. Report immediately in writing to the Governor, the Legislative Research Commission, and the secretary of the Finance and Administration Cabinet, any unauthorized, illegal, irregular, or unsafe handling or expenditure of state funds, or other improper practice of financial administration, or evidence that any such handling, expenditure, or practice is contemplated, and any obstruction of the Auditor or his agents during the conduct of any audit or investigation of a state agency; and
    11. Assist the Legislative Research Commission at hearings and investigations conducted by it and cooperate with the Legislative Research Commission in the preparation of its reports to the General Assembly.
  3. The Auditor may investigate and examine into the conduct of all state and county officers who are authorized to receive, collect, or disburse any money for the state, or who manage or control any property belonging to the state or in which the state is interested, or who make estimates or records that are used as a basis by any state agency in the disbursement of public funds.
  4. The Auditor may conduct a special audit or examination of a city government or any of its agencies or departments.
  5. Except where otherwise provided, any expenses incurred by the Auditor for audits, examinations, investigations, or reviews shall be charged to the entity that is the subject of the audit, examination, investigation, or review. The Auditor shall maintain a record of all time expenses for each audit, examination, investigation, or review.
  6. The Auditor may provide consulting services, in accordance with auditing standards generally accepted in the United States and government auditing standards, to state or local government entities and associations of such entities, including special purpose governmental entities, and may charge a mutually agreed upon rate for those services, including:
    1. Providing training and technical presentations;
    2. Developing audit guides applicable to those entities;
    3. Developing question and answer documents to promote understanding of technical issues or standards; and
    4. Collaborating with other professional organizations to advance auditing of government entities and programs.
  7. The Auditor shall not be responsible for the keeping of any accounts of the state, except accounts relating to his own operations. The Auditor shall not be responsible for the collection of any money due the state, or for the handling or custody of any state funds or property except in the process of counting and verifying the amounts of the funds or property in the course of the audits provided for in this section.

History. 1992b-59, 4618-134, 4622, 4623: amend. Acts 1970, ch. 92, § 14; 1974, ch. 74, Art. II, §§ 9(1) and 9(2); 1978, ch. 92, § 1, effective June 17, 1978; 1982, ch. 450, § 59, effective July 1, 1983; 1990, ch. 512, § 14, effective July 13, 1990; 1992, ch. 27, § 3, effective March 2, 1992; 1998, ch. 39, § 2, effective July 15, 1998; 2009, ch. 78, § 29, effective June 25, 2009; 2010, ch. 141, § 3, effective July 15, 2010; 2016 ch. 17, § 1, effective July 15, 2016; 2020 ch. 59, § 4, effective July 15, 2020.

NOTES TO DECISIONS

1.State Bar and Bar Examiners Funds.

The funds of the Kentucky Bar Association and board of bar examiners have not been collected pursuant to any statute, have not been appropriated by the legislative body and are not subject to legislative appropriation, and thus are not subject to audit by the Auditor of Public Accounts under this section which directs the auditor to audit the accounts of all state, private and semiprivate agencies and accounts of budget units. Ex parte Auditor of Public Accounts, 609 S.W.2d 682, 1980 Ky. LEXIS 274 ( Ky. 1980 ).

2.Scope.

Defamation was not established because the mileage reimbursements paid to a publicly-elected sheriff by a county government were clearly within the scope of an audit of the sheriff's office, as was the sheriff's maximum allowed salary. Moreover, since a lease agreement was within the scope of the audit, any facts underlying the auditors' opinions about the lease were also within scope, and were covered by the pure opinion privilege. Williams v. Blackwell, 487 S.W.3d 451, 2016 Ky. App. LEXIS 16 (Ky. Ct. App. 2016).

Cited:

Perkins v. Sims, 350 S.W.2d 715, 1961 Ky. LEXIS 131 ( Ky. 1961 ).

Opinions of Attorney General.

In the absence of a written demand as set out in subsection (2)(b) of this section an audit by the auditor of public accounts of local officials in their handling of fines, forfeitures, and legal process taxes is permissive only. OAG 67-320 .

State agencies may make payment to the state auditor of the costs of the annual audit or other necessary audit and the auditor may receive such payments, reimbursements and/or interaccounting to cover the costs of such proper services. OAG 68-348 .

The expenditure of money appropriated and allocated to the office of the Auditor of public accounts for auditing the racing and trotting commissions which the State Auditor is not required to do would be an illegal expenditure of such funds. OAG 71-404 .

The State Auditor has no authority to audit the accounts of the Commonwealth Credit Union, Inc., since that corporation is not a “state agency” as defined by KRS 43.010 . OAG 72-121 .

Where the State Auditor is required to make audits for state agencies or departments and the budget of the Auditor does not provide for such services, the costs of such services may be interaccounted and, therefore, the department of military affairs may be required to pay the cost of audits in cities or counties experiencing flood or related disasters. OAG 72-284 .

The Auditor of Public Accounts has the authority to audit the Kentucky State Racing Commission and the Kentucky Trotting Commission and the opinions OAG 71-363 and 71-404 are modified to the extent they are in conflict with this opinion. OAG 72-428 .

Given the provisions of KRS 64.270 (now repealed) a master commissioner would be subject to audit under this section. OAG 72-720 .

The State Auditor has the authority to audit only the accounts of state agencies and county officers and there is no state auditing agency in existence that can audit the records of a city. OAG 74-90 .

The Kentucky Horse Council (now Horse Park Commission) is an agency of state government and all of its funds from whatever source received, including private sources, contributions and membership fees, upon receipt become public funds of a state agency and are subject to all general constitutional and statutory provisions governing the auditing, budgeting, accounting and expending of state funds. OAG 74-715 .

Fees collected by the Governor’s Council on Agriculture and deposited by the Council in a separate bank account must be deposited in and expended through the state treasury and are subject to the general auditing authority of the State Auditor. OAG 75-62 .

A county attorney, who submitted to a 1973 audit in early 1974 and made settlement with the fiscal court for the deficiency in May, 1974, properly refused to submit to a duplicate audit by the State Auditor’s office in 1975 and there was no violation of KRS 43.990(3) since the intent of this section is to avoid unnecessary and duplicate audits. OAG 75-112 .

Although it is clear that a part of the general functions of the State Auditor of Public Accounts, pursuant to this section is to audit, at least annually, the accounts of all state agencies, the General Assembly may statutorily authorize and mandate an audit in addition to this audit, so the plain meaning of KRS 164.760 must be adhered to and the annual audit report therein required to be done by an independent certified public accountant is in addition to any audit report which may be made by the State Auditor. OAG 75-591 .

The State Auditor should bill the counties for the entire cost of the “state” audit as well as the county fee officers audit. OAG 77-50 .

Where the Bureau for the Blind (now Department for the Blind), pursuant to KRS 163.470(14), operates a concession stand within the Louisville post office, the concession operation is subject to audit by the Auditor of Public Accounts pursuant to subsection (2)(a) of this section; since the State Auditor has the responsibility for auditing the Bureau for the Blind (now Department for the Blind), there is nothing in the statutes that would permit him to accept an audit of the concession stand done by a Bureau for the Blind (now Department for the Blind) employee. OAG 80-155 .

The Kentucky Bar Association is not a state agency for the purpose of being subjected to an audit by the Auditor of Public Accounts pursuant to KRS Chapter 43 and since the Bar Association is not a state budget unit, its receipts do not have to be deposited to the State Treasury and its funds are not subject to appropriation by the General Assembly. OAG 80-393 .

The Auditor of Public Accounts has no right to conduct audits of circuit court clerks, as a permissive mandatory matter, if he is not statutorily required or permitted to conduct such audits; however in view of the direct involvement of the circuit clerks in putting money into the state treasury and expending money coming out of the State Treasury, and in view of the express language of subsection (2)(a) of this section and 43.010 , the Auditor of Public Accounts is required to audit the circuit court clerks of Kentucky in the areas of State Treasury involvement, within the practical capabilities of his staff and budget, and considering other mandatory audits. OAG 81-41 .

The Auditor of Public Accounts in an administrative officer, not a legal officer, and must observe the inherent limitations of KRS 43.070 , 43.075 , 43.090 and this section. OAG 82-333 .

Research References and Practice Aids

Cross-References.

Auditor for teachers’ retirement system, KRS 161.370.

Auditor included among departments enumerated, KRS 12.020 .

Books of Louisville and Jefferson County board of health, when to audit, KRS 212.550 .

Copy of published annual financial statement of public officers to be filed with Auditor, KRS 424.220 .

Revenue Cabinet, powers over local finance, KRS 131.140 .

Governor may employ experts for special audit, study or survey, KRS 11.070 , 11.090 to 11.110 .

Legislative Research Commission, KRS 7.090 to 7.110 .

Member of Archives and Records Commission, KRS 171.420 .

State fair fund, auditor to make annual accounting of, KRS 247.190 .

43.060. Annual investigation of accounts of Treasurer and Finance and Administration Cabinet.

The Auditor shall audit annually the Commonwealth’s Comprehensive Annual Financial Report, in accordance with generally accepted government auditing standards, and may at any other time the Auditor thinks necessary audit or examine the books, accounts, and papers of the State Treasurer and the Finance and Administration Cabinet.

History. 1992b-60, 4630: amend. Acts 1974, ch. 74, Art. II, § 9(1); 2020 ch. 59, § 5, effective July 15, 2020.

NOTES TO DECISIONS

1.Settling of Accounts.

The Auditor is required to have his accounts settled monthly. Commonwealth use of Louisville v. Ross, 135 Ky. 315 , 122 S.W. 161, 1909 Ky. LEXIS 290 ( Ky. 1909 ).

Research References and Practice Aids

Cross-References.

Accounts of Auditor and Treasurer to be investigated monthly and results reported, Ky. Const., § 53; KRS 45.301 .

43.070. Audit of accounts of county officers and special purpose governmental entities — Agreed-upon procedures engagement for country clerks and sheriffs.

    1. To determine whether any unauthorized, illegal, irregular, or unsafe handling or expenditure of revenue or other improper practice of financial administration has occurred and to assure that all proper items have been duly charged, taxed, and reported, the Auditor shall audit annually: (1) (a) To determine whether any unauthorized, illegal, irregular, or unsafe handling or expenditure of revenue or other improper practice of financial administration has occurred and to assure that all proper items have been duly charged, taxed, and reported, the Auditor shall audit annually:
      1. The funds contained in each county’s budget; and
      2. The books, accounts, and papers of all county clerks and sheriffs.
    2. The Auditor shall not conduct an audit pursuant to this subsection if the fiscal court or the elected official notifies the Auditor that a certified public accountant has been employed to audit the books, accounts, and papers of the county or the fee office, in accordance with KRS 64.810 .
      1. If any county clerk or sheriff meets the criteria established in this subsection and any additional criteria established in administrative regulations promulgated by the Auditor, that county clerk’s or sheriff’s audit required by this section may, in the discretion of the Auditor, be conducted by an agreed-upon procedures engagement performed by the Auditor. If, in the discretion of the Auditor, an agreed-upon procedures engagement in progress will not provide sufficient oversight of the county clerk’s or sheriff’s office, the Auditor may at any time convert the engagement to an audit performed under paragraph (a)2. of this subsection. A county clerk or sheriff shall not be eligible for the agreed-upon procedures engagement as allowed in this paragraph for the first audit period after election if the county clerk or sheriff is serving in office for the first time, or is assuming the office after experiencing a break in sequential service in that position. (c) 1. If any county clerk or sheriff meets the criteria established in this subsection and any additional criteria established in administrative regulations promulgated by the Auditor, that county clerk’s or sheriff’s audit required by this section may, in the discretion of the Auditor, be conducted by an agreed-upon procedures engagement performed by the Auditor. If, in the discretion of the Auditor, an agreed-upon procedures engagement in progress will not provide sufficient oversight of the county clerk’s or sheriff’s office, the Auditor may at any time convert the engagement to an audit performed under paragraph (a)2. of this subsection. A county clerk or sheriff shall not be eligible for the agreed-upon procedures engagement as allowed in this paragraph for the first audit period after election if the county clerk or sheriff is serving in office for the first time, or is assuming the office after experiencing a break in sequential service in that position.
      2. The Auditor and the county clerk or sheriff shall establish specific procedures for any agreed-upon procedures engagement. If the Auditor and the county clerk or sheriff cannot agree to the specific procedures for an agreed-upon procedures engagement, the audit of the county clerk’s or sheriff’s office shall be conducted under paragraph (a)2. of this subsection for that year subject to the audit.
      3. At a minimum, the county clerk or sheriff shall meet the following criteria in order to be eligible to have the county clerk’s or sheriff’s annual audit in any particular year conducted using agreed-upon procedures:
        1. The county clerk or sheriff applies to the Auditor to have an agreed-upon procedures engagement for the year subject to the audit on a form provided by the Auditor and by the application deadline established by the Auditor;
        2. The county clerk’s or sheriff’s office did not have any reported audit comment or finding in its most recent audit report;
        3. The county clerk or sheriff and the Auditor agree to specific procedures for the agreed-upon procedures engagement; and
        4. Any additional criteria that may be determined by the Auditor.
      4. The publication requirements related to an agreed-upon procedures engagement shall be the same as those required for audits of the county clerks and sheriffs performed under paragraph (a)2. of this subsection, except that the Auditor may provide a summary of the agreed-upon procedures engagement report, and publication of the summary shall satisfy the statutory requirements to publish the audit report, opinion letter, and transmittal letter.
      5. The billing and expense provisions of subsection (3) of this section shall apply to any agreed-upon procedures engagement performed under this section.
      6. The Auditor may promulgate administrative regulations that set forth additional criteria to qualify for agreed-upon procedures engagements, the application procedures, and the standards, procedures, guidelines, and reporting requirements for agreed-upon procedures engagements under this section.
      7. In exercising discretion regarding whether a county clerk or sheriff who otherwise meets the minimum requirements may have an agreed-upon procedures engagement in lieu of an audit for any particular year subject to an engagement, and in exercising discretion regarding the proposed procedures for the agreed-upon procedures engagement for any particular year subject to an audit, the Auditor may consider factors including but not limited to past audit comments or agreed-upon procedures engagement findings, assessment of risks, complaints, financial statements, the number of consecutive agreed-upon procedures engagements performed of the county clerk or sheriff, and other factors relevant to oversight of the county clerk’s or sheriff’s office.
  1. The Auditor may audit:
    1. The books, accounts and papers of all county judges/executive, county attorneys, coroners and constables; and
    2. The books, accounts, papers, and performance of all special purpose governmental entities as defined in KRS 65A.010 . The expense of any audit or examination performed pursuant to this paragraph shall be borne by the entity audited or examined.
  2. The county shall bear one-half (1/2) of the actual expense of the audit conducted pursuant to subsection (1)(a)1. of this section and shall bear the total actual expense of the audit conducted pursuant to subsections (1)(a)2. and (2)(a) of this section. No county shall be required to bear the expense for more than one (1) audit of the same fund or office annually pursuant to subsection (1)(a)1. or 2. of this section, except as provided in KRS 64.810(4).
  3. Within a reasonable time after the completion and distribution of the audit reports authorized by subsection (1) of this section, the Auditor of Public Accounts shall bill the county for the expenses incurred pursuant to subsection (3) of this section. A copy of this bill shall be forwarded to the secretary of the Finance and Administration Cabinet. Should the fiscal court within sixty (60) days following receipt of said bill determine the charge to be excessive or otherwise improper it shall submit its objection to the secretary of the Finance and Administration Cabinet and to the State Treasurer for resolution of the controversy in accordance with subsection (5) of this section. If the amount billed has not been paid within sixty (60) days from date of billing, and no objection has been filed, the Auditor shall notify the secretary of the Finance and Administration Cabinet and the secretary of revenue who shall cause said amount to be deducted from the next payment or return of moneys provided by KRS 47.110 by the state to the county or counties. Deductions shall continue until the total amount due the Auditor’s office has been paid. All moneys received pursuant to this section shall be credited to the trust and agency account of the Auditor of Public Accounts. When an objection to the bill has been filed with the secretary of the Finance and Administration Cabinet and the State Treasurer in accordance with subsection (5) of this section the amount found to be equitable and just shall become payable immediately upon the entry of the final decision.
  4. Any controversy over the amount of the bill for the actual expenses incurred shall be submitted by the fiscal court to the secretary of the Finance and Administration Cabinet and the State Treasurer for a decision as to the proper amount. In the event that these two (2) arbitrators fail to agree, then the controversy shall be submitted to the Attorney General, whose decision shall be final.

HISTORY: 4636-1: amend. Acts 1962, ch. 185; 1974, ch. 74, Art. II, § 9(1); 1974, ch. 254, § 8; 1976, ch. 229, § 1; 1976 (Ex. Sess.), ch. 14, § 12, effective January 2, 1978; 1976 (Ex. Sess.), ch. 20, § 6, effective January 2, 1978; 1978, ch. 197, § 11, effective June 17, 1978; 1982, ch. 121, § 1, effective July 15, 1982; 1984, ch. 111, § 37, effective July 13, 1984; 1986, ch. 51, § 1, effective July 15, 1986; 2013, ch. 40, § 18, effective March 21, 2013; 2018 ch. 118, § 1, effective July 14, 2018.

NOTES TO DECISIONS

1.Scope.

Defamation was not established because the mileage reimbursements paid to a publicly-elected sheriff by a county government were clearly within the scope of an audit of the sheriff's office, as was the sheriff's maximum allowed salary. Moreover, since a lease agreement was within the scope of the audit, any facts underlying the auditors' opinions about the lease were also within scope, and were covered by the pure opinion privilege. Williams v. Blackwell, 487 S.W.3d 451, 2016 Ky. App. LEXIS 16 (Ky. Ct. App. 2016).

Cited:

Ex parte Auditor of Public Accounts, 609 S.W.2d 682, 1980 Ky. LEXIS 274 ( Ky. 1980 ).

Opinions of Attorney General.

The State Auditor has the authority to audit only the accounts of state agencies and county officers and there is no state auditing agency in existence that can audit the records of a city. OAG 74-90 .

Subsection (2) of this section refers only to payment of the State Auditor for audits and does no apply to a private CPA hired in lieu of the State Auditor. OAG 74-449 .

The sheriff is responsible for preparing and submitting his report of settlement to the fiscal court and the reasonable cost of preparing it may be considered an official expense of his office and paid out of his fees, even though the report may not be a formal or technical audit although a formal audit is the most desirable approach from the public viewpoint, since an accountant can accurately and competently determine the existence or nonexistence of excess fees. OAG 75-33 .

The State Auditor is required to audit annually the funds contained in the county budget and the accounts of all county clerks, circuit clerks, county judges (now county judges/executive), county attorneys, sheriffs, jailers, coroners, constables and justices of the peace exercising criminal jurisdiction unless the elected official notifies the state auditor that he has employed a CPA to audit his official account prior to the beginning of the State Auditor’s audit. OAG 75-44 .

A county attorney, who submitted to a 1973 audit in early 1974 and made settlement with the fiscal court for the deficiency in May, 1974, properly refused to submit to a duplicate audit by the State Auditor’s office in 1975 and there was no violation of KRS 43.990(3) since the intent of this section is to avoid unnecessary and duplicate audits. OAG 75-112 .

So long as the $20.00, representing advance costs, remains in the trustee account in the custody of the clerk during the pendency of the suit, and prior to the termination of the suit and the taxing and paying of all costs, the auditor of public accounts has the responsibility of including such “receipts,” though technically not “fees” at that stage, in the auditing of such circuit clerk’s accounts, based upon the provisions in this section and KRS 64.810 that the “books, accounts, and papers” of circuit clerks shall be audited and the advance cost is revenue of the clerk’s office even in the custodial stage. OAG 75-233 .

In view of KRS 64.340 , where a misdemeanor defendant is not convicted, or the case does not proceed to judgment, a sheriff has no statutory means for collecting his fees and, since such fees are uncollectible, he is not accountable for them. OAG 75-393 .

Where a misdemeanor defendant is convicted but never pays the costs, including the sheriff’s fees, the sheriff, as a fee officer, is accountable in his audit for such uncollected fees unless he shows to the Auditor that he took all reasonable and practical means to collect such fees, although the statutes do not make the sheriff an insurer of the collection of fees legally due and payable. OAG 75-393 .

The controlling factor in determining whether the county pays the entire cost of a state audit, as this section provides by the amendment thereto effective June 21, 1974, is the date the audit is conducted, not the calendar year of the accounts audited. OAG 75-620 .

As there is nothing in the 1974 amendment to this section prohibiting retroactive application, such is permissible where the amendment is merely being applied to audits conducted after the amendment’s effective date though involving an account year prior to 1974. OAG 75-653 .

Since the new system of uniform accounting and standard bookkeeping procedures for all counties and county officials was to be established by January, 1975, pursuant to KRS 68.210 , the installation of the new system of auditing of county officials called for by this section and KRS 64.810 was mandatorily required as of January, 1975, and not before. OAG 76-51 .

The State Auditor has the primary responsibility for sending a written audit report of county officials and the letter of transmittal to a newspaper having general circulation in the county examined, and if the audit concerns the county’s budget then the Auditor’s office will have to pay one-half of the publication. OAG 76-204 .

All of the revenue for the 1976-78 biennium provided for in the 1976-78 biennial budget for the Auditor of Public Accounts can be utilized by such office for expenditure to carry out the necessary constitutional functions of such office which functions are determined to be necessary constitutional functions of government. OAG 76-558 .

The State Auditor should bill the counties for the entire cost of the “state” audit as well as the county fee officers audit. OAG 77-50 .

Audits of the county auditor’s office should cover each calendar year during the term of the county attorney. OAG 78-359 .

For purposes of audit, under this section, and for the purpose of determining the sheriff’s aggregate rubber dollar income under Ky. Const., § 246, payments made by the Army Corps of Engineers to county sheriffs under contracts to provide law enforcement to designated civil works water resource projects are to financially assist the sheriffs to step up law enforcement activities in such projects during peak visitation periods, are impressed with a public fee character, accrue to the office, and count toward the aggregate rubber dollar limit for that year. OAG 79-454 .

Where the United States Department of the Army Corps of Engineers has contracted with various fiscal courts and sheriffs for increased law enforcement at civil works water resource projects, the federal financial assistance paid to the fiscal court or the sheriff is construed, for audit purposes of the affected county and sheriff’s income, as included in the audit of the county treasurer, if paid to him, and as county sheriff’s fee income, if paid to him. OAG 79-454 .

Where jailer is carrying on a commissary operation in the jail, he should maintain commissary records in order to provide an adequate basis for determining whether he is operating at a profit to himself or not; such records take on the nature of public records since there is no logical way to disassociate the commissary activity of this public officer from his functions as jailer, and would be a part of the total official records as concerns any auditing of the books. OAG 80-525 .

The audit by the Auditor of Public Accounts apparently carries with it a presumption of the financial status or of correctness as to the county clerk’s account for the year, unless such presumption is overturned or overcome in some way in an appropriate law suit; the exception to this would arise where the account involves “unliquidated claims,” and in which case the fiscal court acting in good faith could work out a compromise with the clerk as to any unliquidated claims. OAG 80-618 .

The county attorneys of Kentucky are not required to publish a financial statement pursuant to KRS 424.220 since the auditing of the county attorney’s books pursuant to this section and KRS 64.810 is ample to disclose the specifics of his official operation. OAG 81-168 .

The Auditor of Public Accounts is an administrative officer, not a legal officer, and must observe the inherent limitations of KRS 43.050 , 43.075 , 43.090 and this section. OAG 82-333 .

There is no statute which authorizes a county to charge interest on money owed from any fee officer after his audit has been completed for that year. OAG 82-489 .

The Auditor’s duty under KRS 43.070 et seq. requires audit reports of each officer, rather than one report for both the elected officer and the appointed successor, because without separate reports the Auditor’s findings would not reflect the separate liabilities, if any, of the person having responsibility for the public funds. OAG 91-227 .

Under KRS 64.810 , a fiscal court, county clerk, or sheriff has authority to employ a certified public accountant to perform to audit called for by this section, only if the Auditor of Public Accounts declines to perform such audit, or has failed to respond within 30 days to a written notice of intent to employ a certified accountant for such purpose. OAG 93-2 .

Research References and Practice Aids

Cross-References.

Copy of published annual statement of public officers to be filed with Auditor, KRS 424.220 .

Revenue Cabinet, investigation of officers’ accounts, KRS 131.210 .

43.071. Annual audit of county clerk’s motor vehicle and motorboat tax receipts.

  1. The Auditor of Public Accounts shall annually audit each county clerk concerning:
    1. All receipts due from the collection of motor vehicle and motorboat registration fees, motor vehicle and motorboat licenses and other receipts due the clerk pertaining to motor vehicles and motorboats as prescribed in KRS Chapters 186, 186A and 235;
    2. All receipts due from the collection of motor vehicle usage tax as prescribed by KRS 138.460 ; and
    3. All receipts due from the collection of the ad valorem tax on motor vehicles and motorboats as prescribed by KRS 134.800 . These annual audits shall be completed by April 15 of the year following the year to be audited.
  2. The provisions of KRS 43.070 shall not apply to the separate and distinct duties imposed on the Auditor of Public Accounts pursuant to subsection (1) of this section. The audits specified in subsection (1) of this section shall be conducted prior to the audits mandated by KRS 43.070 .
  3. Immediately upon completion of each audit, the Auditor of Public Accounts shall prepare a report of his findings noting any indebtedness to the Commonwealth. He shall furnish one (1) copy to the county clerk, one (1) copy to the secretary of the Transportation Cabinet, one (1) copy to the secretary of the Finance and Administration Cabinet and one (1) copy to the secretary of the Energy and Environment Cabinet. If the county clerk objects to any findings of indebtedness in the Auditor’s report, he shall file a written response with the Auditor within ten (10) days of his receipt of the report. The Auditor shall consider the written response and within thirty (30) days of its receipt issue a final report. If the county clerk wishes to object to any findings of indebtedness contained in the final report, he shall file a request within ten (10) days of his receipt of the final report for a hearing before a three (3) member panel composed of the secretary of transportation or his designee, the commissioner of the Department of Revenue or his designee, and the president of the Kentucky County Clerks Association or his designee. The hearing shall be conducted in accordance with the provisions of KRS Chapter 13B. The majority decision of this panel shall be determinative of any indebtedness to the Commonwealth. If the county clerk wishes to appeal the decision of this panel, he shall file the appeal in the Circuit Court for the county where he serves in accordance with KRS Chapter 13B.

History. Enact. Acts 1986, ch. 429, § 3, effective July 15, 1986; 1988, ch. 163, § 17, effective January 1, 1990; 1996, ch. 318, § 27, effective July 15, 1996; 2005, ch. 85, § 58, effective June 20, 2005; 2010, ch. 24, § 36, effective July 15, 2010.

43.073. Annual audit of school district entity by Auditor or private accountant — Expenses — Review of private audit by Auditor.

  1. The Auditor of Public Accounts shall be responsible for an annual audit of the funds contained in each school district cooperative, school district consortium, school district corporation, and any other entity formed by school districts in an agreement made pursuant to KRS 65.210 to 65.300 , with the cost of the audit to be borne by the audited entity.
  2. A school district cooperative, school district consortium, school district corporation, or other entity formed by school districts in an agreement made pursuant to KRS 65.210 to 65.300 may employ a certified public accountant to audit the books, accounts, and papers of the cooperative, consortium, corporation, or other entity in lieu of the audit required by subsection (1) of this section, if the Auditor of Public Accounts declines in writing to assume responsibility for performing the audit or fails to respond in writing within thirty (30) days of receiving the cooperative’s, consortium’s, corporation’s, or other entity’s written notice of its intent to employ a certified public accountant to conduct the audit. The cooperative, consortium, corporation, or other entity shall not enter into any contract with a certified public accountant for an audit unless the Auditor of Public Accounts has declined in writing to assume responsibility for performing the audit or has failed to respond within thirty (30) days of receipt of a written request for an audit.
    1. Any contract with a certified public accountant entered into as a result of the Auditor of Public Accounts either declining to assume responsibility of performing the audit or failing to respond within thirty (30) days of receipt of a written request for an audit shall specify the following: (3) (a) Any contract with a certified public accountant entered into as a result of the Auditor of Public Accounts either declining to assume responsibility of performing the audit or failing to respond within thirty (30) days of receipt of a written request for an audit shall specify the following:
      1. That the certified public accountant shall forward a copy of the audit report and management letters to the Auditor of Public Accounts for review;
      2. That the Auditor of Public Accounts shall have the right to review the certified public accountant’s work papers before and after the release of the audit; and
      3. That after review of the certified public accountant’s work papers, if discrepancies are found, the Auditor of Public Accounts shall notify the audited entity of the discrepancies. If the certified public accountant does not correct these discrepancies prior to the release of the audit, the Auditor of Public Accounts may conduct its own audit to verify the findings of the certified public accountant’s report.
    2. If an audit verifying the findings of the certified public accountant’s report is conducted by the Auditor of Public Accounts, the total audit expense incurred by the audited entity shall be an allowable expenditure and shall be paid by the audited entity to the Auditor of Public Accounts. If the audit conducted by the Auditor of Public Accounts discloses discrepancies in the audit by the certified public accountant, the findings of the Auditor of Public Accounts shall be deemed official for all purposes.

History. Enact. Acts 2000, ch. 491, § 1, effective July 14, 2000.

43.075. Uniform standards and procedures.

  1. The Auditor shall develop uniform standards and procedures for conducting, and uniform formats for reporting, all audits of county budgets and the accounts, books and papers of elected county or district officials performed under KRS 43.070(1)(a)1. and 2. or (1)(b) or 64.810 . The Auditor shall promulgate the uniform standards and procedures by administrative regulation according to KRS Chapter 13A.
  2. Upon and after July 15, 1986, no person shall conduct an audit under KRS 43.070(1)(a)1. and 2. or (1)(b) or 64.810 which does not comply with the standards and procedures promulgated by the state Auditor of Public Accounts under subsection (1) of this section.
  3. The uniform audit standards and procedures promulgated by the Auditor shall include but need not be limited to the requirement that each person performing an audit shall determine whether the fiscal court or county official is complying with the requirements of the uniform system of accounts adopted under KRS 68.210 , whether there is accurate recording of receipts by source and expenditures by payee, and whether or not each official is complying with all other legal requirements relating to the management of public funds by his office, including all publication requirements. The requirements for uniform formats for audit reports shall require that the format of reports for each category of county or district office shall be uniform.
  4. The Auditor shall make informational copies of the regulations containing the audit standards and procedures available to interested persons at their request, and may charge a reasonable fee for such copies.

History. Enact. Acts 1976, ch. 49, § 1; 1986, ch. 51, § 2, effective July 15, 1986; 2013, ch. 40, § 19, effective March 21, 2013.

Opinions of Attorney General.

The Auditor of Public Accounts is an administrative officer, not a legal officer, and must observe the inherent limitations of KRS 43.050 , 43.070 , 43.090 and this section. OAG 82-333 .

43.080. Access to books and records — Power to obtain testimony.

  1. The Auditor and his authorized agents shall have access to and may examine all books, accounts, reports, vouchers, correspondence files, records, money and property of any state agency. Every officer or employee of any such agency having such records or property in his possession or under his control shall permit access to and examination of them upon the request of the Auditor or any agent authorized by him to make such request.
  2. The Auditor and his assistants shall have access at all times to the papers, books and records of the asylums, prisons, institutions for the intellectually disabled and eleemosynary institutions, and public works that he is authorized to examine, and of any county officer who receives or disburses county funds.
  3. The Auditor may require information on oath from any person touching any matters relative to any account that the Auditor is required to state, audit or settle. The Auditor may administer the oath himself, or have it done by any officer authorized to administer an oath.
  4. The Auditor and his assistants may issue process and compel the attendance of witnesses before them, and administer oaths and compel witnesses to testify in any of the investigations the Auditor is authorized to make.

History. 150, 4618-136, 4625, 4636-1: amend. Acts 1978, ch. 92, § 2, effective June 17, 1978; 2010, ch. 141, § 4, effective July 15, 2010.

Opinions of Attorney General.

This section would not authorize the Auditor to subpoena construction plans in the possession of an individual stockholder of a construction company. OAG 77-436 .

43.090. Reports of audits and investigations — Implementation by agency of audit recommendation.

  1. Immediately upon completion of each audit and investigation, except those provided for in KRS 43.070 , the Auditor shall prepare a report of his or her findings and recommendations. He or she shall furnish one (1) copy of the report to the head of the agency to which the report pertains, one (1) copy to the Governor, one (1) copy to the secretary of the Finance and Administration Cabinet, one (1) copy to the Legislative Research Commission, and one (1) copy to the state librarian. The agency to which an Auditor’s draft report pertains shall respond in writing to any adverse or critical audit findings and to any recommendations contained in the draft report within fifteen (15) days of receipt of the draft report. The Auditor shall distribute the agency’s response to those entitled by this subsection to a copy of the audit report. Within sixty (60) days of the completion of the final audit or examination report, the agency to which an Auditor’s report pertains shall notify the Legislative Research Commission and the Auditor of the audit recommendations it has implemented and of the audit recommendations it has not implemented. The agency shall state the reasons for its failure to implement any recommendation made in the final audit or examination report. All audit reports and agency responses shall be, subject to KRS 61.870 to 61.884 , posted online in a publicly searchable format.
  2. The Auditor shall, within a reasonable time after the examination of each county as provided in KRS 43.070 , make a written report to the Governor, the General Assembly, the Attorney General, the state librarian, and the fiscal court and county attorney of the county examined, calling attention in specific terms to any mismanagement, misconduct, misapplication or illegal appropriation, or extravagant use of money received or disbursed by any officer of the county examined. In addition, said report shall be sent to a newspaper having general circulation in the county examined, and the letter of transmittal accompanying the report shall be published in said newspaper in accordance with the provisions of KRS Chapter 424. All audit reports and responses shall be, subject to KRS 61.870 to 61.884 , posted online in a publicly searchable format.

History. 1992b-59, 4618-135, 4636-4: amend. Acts 1942, ch. 139, §§ 1, 2; 1966, ch. 255, § 52; 1974, ch. 254, § 9; 1982, ch. 176, § 2, effective July 15, 1982; 2007, ch. 47, § 25, effective June 26, 2007; 2020 ch. 59, § 6, effective July 15, 2020.

Opinions of Attorney General.

The State Auditor has the primary responsibility for sending a written audit report of county officials and the letter of transmittal to a newspaper having general circulation in the county examined, and if the audit concerns the county’s budget then the Auditor’s office will have to pay one-half of the publication cost. OAG 76-204 .

Although this section makes audits “public documents,” under KRS 61.878 (f) these documents would not be available for public inspection, if they were to be the basis for a criminal prosecution, until after the criminal action was resolved. OAG 78-816 .

This section, in providing that audit and investigative reports are public documents, in effect amends KRS 61.870 (2) which defines “public records,” since this section, as amended in 1978, is later legislation (KRS 61.870 was enacted in 1976) and constitutes specific as contrasted with general legislation. OAG 78-816 .

It is not necessary that the letter of transmittal published under this section should contain notes accompanying the financial statement (audit). OAG 79-103 .

The letter of transmittal required by subsection (2) of this section should merely serve the purpose of alerting the public to the fact that an audit of the county funds has been completed and that a copy is on file with the clerk of fiscal court. OAG 79-103 .

The publication of a letter of transmittal under this section or even an Auditor’s report of audit in no way serves to cancel out the county treasurer’s duty to publish his or her report under KRS 424.220 . OAG 79-103 .

The Auditor of Public Accounts is an administrative officer, not a legal officer, and must observe the inherent limitations of KRS 43.050 , 43.070 , 43.075 and this section. OAG 82-333 .

43.200. Auditor’s scholarships in accounting.

  1. There is hereby created in the Auditor of Public Accounts office a scholarship program for economically disadvantaged students planning to major in accounting at Kentucky institutions of higher education agreeing to provide matching funds.
  2. Up to four (4) students each year may be selected by the Auditor as eligible to receive a scholarship for up to four (4) years while pursuing an accounting degree. Each individual scholarship shall be subject to review annually.
  3. The annual scholarship amount shall be set by the Auditor in an amount required to cover the average cost of room, board, tuition, and fees at Kentucky public institutions, as well as living expenses. In addition, the scholarship shall include full-time summer employment with the Auditor’s office.
  4. Upon receiving their accounting degree, recipients of the scholarship shall be required to work one (1) year for the Auditor’s office for each year they received the scholarship.
  5. Recipients failing to complete an accounting program or failing to fulfill the service requirement shall become liable to the Auditor’s office for the sum of all scholarship funds received plus interest for the entire period. The rate of interest shall be determined when the scholarship is awarded. The debt may be deferred for cause by the Auditor and a schedule for repayment may be established.
  6. The Auditor’s office shall execute appropriate contracts and promissory notes with scholarship recipients.

History. Enact. Acts 1988, ch. 358, § 1, effective July 15, 1988; 2020 ch. 59, § 7, effective July 15, 2020.

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 23, (1) at 860.

43.990. Penalties.

  1. Any officer who prevents, attempts to prevent or obstructs an examination by the Auditor, under the provisions of paragraph (c) of subsection (2) of KRS 43.050 , or of subsection (3) of KRS 43.050 , into his official conduct, or the conduct or condition of the office in his charge or with which he is connected, except when the office constitutes a state agency, is guilty of a high misdemeanor, and, upon conviction on indictment in the Franklin Circuit Court, shall be fined five hundred dollars ($500) and removed by the Governor. Any person, other than an officer, who prevents, attempts to prevent or obstructs such an examination shall be fined one thousand dollars ($1,000).
  2. If the Auditor fails or refuses without good cause to perform the duties imposed upon him by KRS 43.060 , he shall be fined not less than two hundred and fifty dollars ($250) nor more than one thousand dollars ($1,000) for each offense.
  3. Any county officer who prevents, attempts to prevent or obstructs an examination by the Auditor, under KRS 43.070 , into his official conduct, or the conduct or condition of the office in his charge or with which he is connected, is guilty of a high misdemeanor, and shall, upon indictment and conviction in the Franklin Circuit Court, be fined five hundred dollars ($500). Any person, other than a county officer, who prevents, attempts to prevent or obstructs such an examination shall be fined one thousand dollars ($1,000).
  4. Any officer or other person who fails or refuses to permit the access and examination provided for in subsection (1) of KRS 43.080 , or who interferes with such examination, shall be fined not less than one hundred dollars ($100), or imprisoned in the county jail for not less than one (1) month nor more than twelve (12) months, or both. Each refusal by an officer shall constitute a separate offense.
  5. Any person who has custody of any papers, books or records of an asylum, prison, institution for the intellectually disabled or eleemosynary institution or public works, other than a state agency, that the Auditor is authorized to examine under paragraph (c) of subsection (2) of KRS 43.050 , under subsection (3) of KRS 43.050 , and under subsection (2) of KRS 43.080 , who fails or refuses, when called upon by the Auditor for that purpose, to permit him to inspect any of such papers, books or records, shall, upon conviction on indictment in the Franklin Circuit Court, be fined not more than five hundred dollars ($500) and be subject to removal by the Governor.
  6. Any person who refuses to be sworn when required by the Auditor to be sworn for the purpose mentioned in subsection (3) of KRS 43.080 shall be fined not more than one hundred dollars ($100).
  7. Any witness called by the Auditor under subsection (4) of KRS 43.080 who fails, without legal excuse, to attend or testify shall be fined not more than two hundred and fifty dollars ($250).

History. 150, 4618-136, 4625, 4626, 4628, 4629, 4635, 4636-2, 4636-3: amend. Acts 1978, ch. 92, § 3, effective June 17, 1978; 1980, ch. 348, § 1, effective July 15, 1980; 2010, ch. 141, § 5, effective July 15, 2010.

Opinions of Attorney General.

A county attorney, who submitted to a 1973 audit in early 1974 and made settlement with the fiscal court for the deficiency in May, 1974, properly refused to submit to a duplicate audit by the State Auditor’s office in 1975 and there was no violation of this section since the intent of this chapter is to avoid unnecessary duplicate audits. OAG 75-112 .

CHAPTER 44 Claims Upon the Treasury

44.001. Definitions for chapter.

As used in this chapter:

  1. “Local government” means any city, county, urban-county government, consolidated local government, charter county government, or unified local government of the Commonwealth;
  2. “Warrant” has the same meaning as in KRS 41.010 ; and
  3. “Writing” or “written” means letters, words, or numbers, or their equivalent, set down by handwriting, typewriting, printing, photostating, photographing, magnetic impulse, mechanical or electronic recording, or other form of data compilation.

History. Enact. Acts 1998, ch. 120, § 4, effective July 15, 1998; 2013, ch. 88, § 1, effective June 25, 2013; 2021 ch. 155, § 21, effective June 29, 2021.

NOTES TO DECISIONS

1.Sanitation district was not a local government.

Chapter 7 trustee was entitled to an order allowing him to garnish the accounts of a county sanitation district in order to satisfy a judgment because Ky. Rev. Stat. Ann. § 66.400 , which provided that the public property of any local government used for government or public purposes was exempt from seizure by attachment, execution, or other legal process, did not apply to sanitation districts, as they did not fall within the statutory definition of a local government. Further, even if it did, it could not apply retroactively to the judgment, which was entered prior to the enactment of § 66.400 , which became effective on June 27, 2019. Keats v. Bullitt Cty. Sanitation Dist. (In re Bullitt Utils., Inc.), 2019 Bankr. LEXIS 3403 (Bankr. W.D. Ky. Oct. 29, 2019).

44.010. Claims upon State Treasury, how paid.

All claims upon the State Treasury that are authorized by law shall be paid when due by the State Treasurer to the person entitled to the amount claimed. The warrant for such payment shall be issued by the Finance and Administration Cabinet upon such proof of services performed or of demand made as is required by law.

History. 340: amend. Acts 1974, ch. 74, Art. II, § 9(1).

NOTES TO DECISIONS

1.Origin of Claim.

Claims against the Treasury cannot arise by implication, and he who demands money from the public Treasury must fail unless his claim is warranted by law. Hager v. Sidebottom, 130 Ky. 687 , 113 S.W. 870, 1908 Ky. LEXIS 310 ( Ky. 1908 ).

2.Legality of Claim.

The Commissioner of Finance (now Secretary of Finance and Administration) has an opportunity to review and control payment of claims when presented. Reeves v. Talbott, 289 Ky. 581 , 159 S.W.2d 51, 1941 Ky. LEXIS 37 ( Ky. 1941 ).

To the extent the Department of Finance (now Finance and Administration Cabinet) is authorized to certify the correctness of a claim from an accounting and bookkeeping standpoint, the warrant must be honored by the Treasurer; however, the designation by the Legislature of certain specific duties and responsibilities under Ky. Const., § 93 does not extinguish the implied obligation of the office and the treasurer may properly, acting in good faith, upon a substantial constitutional ground, raise a question for judicial determination concerning the legality of a claim upon the Treasury. Raney v. Stovall, 361 S.W.2d 518, 1962 Ky. LEXIS 246 ( Ky. 1962 ).

3.Person Entitled.

Prior to KRS 427.130 “person entitled” did not include an attaching creditor of an officer paid by the state. Tiller v. Burke, 43 S.W. 182, 19 Ky. L. Rptr. 1149 (1897); Dickinson v. Johnson, 110 Ky. 236 , 61 S.W. 267, 22 Ky. L. Rptr. 1686 , 1901 Ky. LEXIS 78 ( Ky. 1901 ).

4.Basic Reparation Benefits.

The basic reparation benefits section of the Motor Vehicle Reparations Act, KRS 304.39-060 , applies to awards made by the Board of Claims pursuant to KRS Chapter 44. Cooke v. Board of Claims, 743 S.W.2d 32, 1987 Ky. App. LEXIS 575 (Ky. Ct. App. 1987).

Opinions of Attorney General.

“When due” within the meaning of this section includes the requirement that the services have been rendered. OAG 79-448 .

The advance payment of money to the Brussels office of the European economic development office of the Commonwealth of Kentucky for the purpose of paying certain operational expenses is constitutional under Ky. Const., §§ 3 and 171 and meets precisely the requirements of this section that claims against the state treasury be paid only when due since the final and effective disbursement of the operational money is only effected after the persons or corporations have actually performed the services. OAG 79-532 .

Any practice of making full or partial payments on state personal service contracts in advance of the actual and full performance of the contract is unconstitutional. OAG 80-38 .

Statutory law and Ky. Const., §§ 3 and 171 mandate the payment of state money only after the services have been rendered or performed. OAG 82-281 .

Where it is contemplated that state money must be turned over or advanced to private or corporate contractors before contractual services are actually rendered, and the state officials engaging in the contracts determine in good faith that such advancements are necessary in point of time and the ultimate rendering of the services sought, such advancements may be constitutional under these conditions: (1) the contract must expressly provide that the responsible contractor will not make final effective disbursement of the advanced state funds until the contractual services have in fact been rendered; (2) in order to protect the State Treasury, the contractor must execute a suitable bond or procure an insurance contract providing for full repayment to the state where advanced money has been disbursed without reflecting the concomitant contractual services to be rendered. OAG 82-281 .

Where the state’s money remains in the hands of officials or employes of state government and the money is not finally and effectively paid out until the services are performed, such an arrangement is valid under Ky. Const., §§ 3 and 171. OAG 82-281 .

An action for negligence pursuant to this section appears to be the only potential way recovery may be had from the Commonwealth for damages caused by wild deer if, indeed, recovery may be had at all. OAG 90-70 .

There being no legislative waiver of the Commonwealth’s immunity from suit for damage by wild deer, and there being no legal duty of the Commonwealth to prevent wild deer from damaging persons or property such as would give rise to a Board of Claims action sounding in negligence, the Commonwealth of Kentucky, Department of Fish and Wildlife Resources, incurs no legal liability as a result of wild deer injuring persons or damaging property. OAG 90-70 .

In the limited circumstance where federal law preempts state law that would otherwise govern, the State Treasurer may authorize, without a completed “warrant” at the time the authorization is given, the financial agent of the U.S. Treasury to debit the bank account of the Commonwealth for the amount the Commonwealth owes in federal tax deposits. OAG 94-65 .

Research References and Practice Aids

Cross-References.

Annual statement of state expenditures to be published, Ky. Const., § 230.

Attachment or garnishment of sums due from Treasury, KRS 427.130 .

Constitutional provisions relating to payments out of State Treasury, Ky. Const., §§ 58, 59(14), 98, 106, 120, 230.

County boards of assessment appeals to receive half of compensation from State Treasury, KRS 133.030 .

Election expenses, state to pay part of, KRS 117.345 .

Fees of county officers paid into Treasury, 25% to be returned to counties, KRS 64.350 .

Fees of officers payable out of State Treasury, KRS Ch. 64.

Fraudulent, illegal or erroneous claim, attorney general to recover, KRS 15.060 .

How claims presented, approved and paid, KRS 41.120 , 41.160 , 45.121 .

Money not to be drawn from State Treasury unless appropriated, Ky. Const., § 230; KRS 41.110 .

Premiums on sheriffs’ bonds, when claim against state, KRS 62.155 .

Private claims against state, when may be allowed or paid, Ky. Const., § 58.

Record books, blanks and forms paid for by state, KRS 46.020 .

Refund of money by local or special act forbidden, Ky. Const., § 59(14).

Refund or credit of taxes, KRS 134.580 , 134.590 .

Salaries of county and city officers, when to be paid out of State Treasury, Ky. Const., § 106.

Witnesses, when fees paid by state, KRS 30A.110, 421.030 , 421.050 .

Kentucky Law Journal.

Oberst and Lewis, Claims Against the State of Kentucky, 42 Ky. L.J. 65 (1953).

44.020. Claims allowed by courts — Contest.

  1. Within three (3) working days after the first and fifteenth of each month, the sheriff, or any other public official with a claim payable from the State Treasury for duties performed in any court of the Court of Justice, shall make out the claim and have it certified by the judge of the court as allowable for payment, and transmit the list to the Department for Local Government. The claim approved by the judge of the court shall serve as an order of allowance notwithstanding any statutory provision to the contrary. The Department for Local Government shall keep a separate record of all claims allowed in each county, noting the number and amount of each warrant issued for the payment of the claims.
  2. The order of any court authorized by law to approve and allow fee bills, settlements, credits, charges, and other claims against the State Treasury shall not be treated as a judgment, or made conclusive against the state, but shall only be regarded as prima facie evidence of the correctness and legality of the fee bill, settlement, credit, charge, or claim. The Department for Local Government, if it believes the fee bill, settlement, credit, charge, or claim to be fraudulent, erroneous, or illegal, may, upon the advice of the Attorney General, refuse to pay and may contest the claim in the Franklin Circuit Court, which shall have exclusive jurisdiction of all actions against the Department for Local Government to compel the payment of claims against the State Treasury.

History. 340a-1, 359: amend. Acts 1954, ch. 191; 1974, ch. 74, Art. II, § 9(1); 1976, ch. 62, § 51; 1976 (Ex. Sess.), ch. 14, § 13; 1978, ch. 384, § 123, effective June 17, 1978; 1990, ch. 136, § 1, effective July 13, 1990; 1998, ch. 69, § 15, effective July 15, 1998; 2007, ch. 47, § 26, effective June 26, 2007; 2010, ch. 117, § 32, effective July 15, 2010.

NOTES TO DECISIONS

1.Refusal to Issue Warrant.

The Auditor (now Finance and Administration Cabinet) may refuse to issue warrant for any claim, the correctness of which he questions. Greene v. Ballard, 174 Ky. 808 , 192 S.W. 841, 1917 Ky. LEXIS 246 ( Ky. 1917 ).

2.Defendant’s Costs in Felony Case.

Circuit Courts may not bind state for attendance and mileage claims of witness for defendant tried for a felony, nor for cost of subpoenaing the witness. Greene v. Ballard, 174 Ky. 808 , 192 S.W. 841, 1917 Ky. LEXIS 246 ( Ky. 1917 ).

3.Order Authorizing Claim.

An order of court allowing a claim against the treasury is prima facie evidence of that correctness of the claim. Talbott v. Caudill, 248 Ky. 146 , 58 S.W.2d 385, 1933 Ky. LEXIS 206 ( Ky. 1933 ).

4.Contesting Claim.

The joint decision of the Auditor (now Finance and Administration Cabinet) and Attorney General not to contest the validity of a claim is not final. Commonwealth v. Carter, 55 S.W. 701, 21 Ky. L. Rptr. 1509 , 1900 Ky. LEXIS 545 ( Ky. 1900 ).

5.— Exclusive Jurisdiction.

Franklin Circuit Court has exclusive jurisdiction of all actions to compel payment of claims by the Auditor (now Finance and Administration Cabinet). Greene v. Wolf, 175 Ky. 58 , 193 S.W. 1048, 1917 Ky. LEXIS 290 ( Ky. 1917 ).

6.— Petition.

In suit against circuit clerk for sums paid by state on fraudulent witness claims issued by him, petition should have alleged transmission by clerk of alphabetical list of claims, but such defect was cured by verdict. Fraize v. Commonwealth, 16 Ky. L. Rptr. 29 (1894).

7.Appeal of Award.

Plaintiffs maintained that under this section an award of attorney fees against the Commonwealth could only be reviewed by the Franklin Circuit Court. However, the case was unique in that the Franklin Circuit Court was the court which ordered the award of attorneys fees against the Commonwealth and since statutes must be given a practical construction, and will not be given strict or literal reading where this would lead to an absurd or unreasonable conclusion, it would be unreasonable for the Franklin Circuit Court to review its own decision. Giving the statute a practical construction in light of the special circumstances and the fact that all parties were entitled as a matter of right to one appeal under Ky. Const., § 115, the Court of Appeals held that its jurisdiction over the appeal in this case was proper. Revenue Cabinet v. Barbour, 836 S.W.2d 418, 1992 Ky. App. LEXIS 14 (Ky. Ct. App. 1992).

Cited:

Commonwealth ex rel. Att’y Gen. v. Bacon, 111 S.W. 387, 1908 Ky. LEXIS 337 , 33 Ky. L. Rptr. 935 (Ky. Ct. App. 1908).

Opinions of Attorney General.

Claims of the Circuit Court clerk for fees in lunacy cases presided over by the county judge (now county judge/executive) may be approved by said judge at the time of the inquest, otherwise they must be approved by the Circuit Judge. OAG 65-457 .

Although subsection (2) of this section provides that an order of a court allowing fees, etc., shall not be treated as a “judgment,” the Legislature intended to say that such judgments for claims shall not be “final judgments,” since the Executive Department for Finance and Administration (now Finance and Administration Cabinet) may contest a particular claim in Franklin Circuit Court, which has exclusive jurisdiction of such matters. OAG 78-249 .

Since this section concerns only claims against the state allowed by courts, the inclusion of the “county court clerk” is a misnomer since there is no county court and is meaningless in that context. OAG 78-249 .

The term “claims payable out of the state treasury,” as it appears in this section, means claims, arising out of court actions, for which there are statutory provisions or appropriations and would include statutory fees earned by local officials in court actions, which fees must be taxed as costs and included in the judgment. OAG 78-249 .

A fee based on the sheriff’s fee schedule contained in KRS 64.090 and paid to the sheriff for services in summoning grand and petit jurors and performing his duties under KRS Chapter 29A is payable out of the State Treasury; and since such claims would arise out of court actions, this section would apply. OAG 81-336 .

Although KRS 64.348 (now KRS 64.092 ), which involves fees for officers attending court and litigation, is silent as to who pays the fees, the strongest implication is that it must be borne by the state, for whom the services are rendered, thus this section would apply. OAG 81-336 .

KRS 421.250 which provides for procuring prosecuting witnesses from other states but does not cover defense witnesses, involves court action and thus this section applies. OAG 81-336 .

Pursuant to KRS 62.155 , the premium on the sheriff’s general revenue bond and his faithful performance bond must be paid by the state; thus, in counties of 75,000 population or more, the chief circuit judge and Circuit Court, or fiscal court, as the case may be under KRS 64.345(2), may permit the sheriff to take the subject premium out of the sheriff’s “75% account” where the state has not otherwise paid the premium; however, this section does not apply. OAG 81-336 .

Special bailiff compensation which is dealt with in KRS 421.135 involves a “felony case” and thus this section applies. OAG 81-336 .

Pursuant to KRS 29A.180(1), the sheriff, city police or city marshal, as appropriate, shall be initially responsible for meals, housing, and other incidental needs of grand jurors and petit jurors in circuit and district court when the jurors are kept overnight or otherwise sequestered, when ordered to do so by the judge of the court for which the jurors were summoned and, since the officer who had to pay for such services initially will be reimbursed by the Finance Department (now Finance and Administration Cabinet), this section is not involved. OAG 81-336 .

The jailer fees enumerated in KRS 64.150 (now repealed), including the prisoner dieting fee and court attendance fee, must be paid by the government whose law the prisoner is charged with violating; thus, if the prisoner is charged with violating a state statute, the state must pay the jailer fees and this section, involving court approval of the fees, applies. OAG 81-336 .

This section applies to KRS 421.015 which pertains to a mileage allowance for Kentucky witnesses in Circuit and District Courts. OAG 81-336 .

This section applies to KRS 421.030 , which relates to nonresident prosecutorial witness expenses in felony cases. OAG 81-336 .

This section does not apply to KRS 441.010 (now KRS 441.045 ), under which the state must pay for nonpostponable medical care extended to an indigent prisoner in the county jail, provided the prisoner is charged with violating a state statute and is not a prisoner of the United States. OAG 81-336 .

This section does not apply to the payment of the jury commissioners or jurors, both of which must be effected by each circuit clerk out of one or two imprest funds of the clerk established by the state treasurer and the Department of Finance (now Finance and Administration Cabinet) pursuant to KRS 30A.110. OAG 81-336 .

This section may be read together and applied with KRS 64.070(2), (4), KRS 441.030 (now KRS 441.520 ), and KRS 441.040 (now KRS 441.530 ), relating to the transfer of prisoners to a secure jail or to the penitentiary, and the court order directing the transfer and awarding the sheriff compensation therefor, and KRS 441.050 (now KRS 441.540 ) relating to the transfer of a prisoner to the penitentiary when violence is threatened and the court approval of fees for the sheriff. OAG 81-336 .

This section which provides the procedure for paying claims out of the state treasury would not apply to KRS 440.090 , since the return of a fugitive or extradition under KRS 440.090 is effected through the Governor of Kentucky and the fugitive is brought back and placed in the jail of the county designated in the proclamation and thus, the extradition is accomplished outside the frame of litigation. OAG 81-336 .

A court has no authority to direct the Finance and Administration Cabinet to make direct payments for deputy sheriff court attendance to the deputy sheriff so attending court since such fees are in legal reality the fees of the sheriff’s office; thus the payments should go directly to the sheriff. OAG 83-19 .

Research References and Practice Aids

Cross-References.

Compromise of disputed claims by or against Commonwealth or state budget unit, KRS 45.121 .

44.030. Money not to be paid to state or local government debtor — Priority of multiple claims — Matching child support obligors and claimants — Information on debts referred to Department of Revenue to be provided to State Treasurer.

  1. No money shall be paid to any person on a claim against the state in his or her own right, or as an assignee of another, when the person or the person’s assignor is indebted to the state or any local government. The claim, to the extent it is allowed, shall first be credited to the account of the person indebted to the state, and if there is any balance due the person after settling the whole demand of the state, any certified liquidated debts of any local government shall be paid if the local government provides information concerning the liquidated debt to the State Treasurer. If there is any balance due the person after settling the whole demand of the state or local governments, and if there are not liquidated debts certified against the claim pursuant to KRS 44.065 , that balance shall be paid to the person.
  2. In case of multiple claims by state agencies, the claims shall be paid as follows:
    1. First, to any claim made by the Cabinet for Health and Family Services for past due child support obligations;
    2. Second, to any claim filed by the Finance and Administration Cabinet, Department of Revenue, for taxes owed the Commonwealth; and
    3. Third, to all other state agencies in the order that the claims were filed with the State Treasury.
  3. In the case of multiple claims filed by any local government, the claims shall be paid in the order that the claims were filed with the State Treasury.
  4. No money shall be paid to any person on a claim against a local government in his or her own right, or as an assignee of another, when the person or the person’s assignor is indebted to the local government or the state. The claim, to the extent it is allowed, shall first be credited to any debt of the person indebted to the local government, and if there is any balance due the person after settling the whole demand of the local government, any certified liquidated debts of the state shall be paid if the state provides the local government with information concerning the liquidated debt. If there is any balance due the person after settling the whole demand of the local government or the state, that balance shall be paid to the person.
  5. The Finance and Administration Cabinet shall provide the Cabinet for Health and Family Services with a quarterly report of all tort claims made against the state by individuals that the Cabinet for Health and Family Services shall compare with the child support database to match individuals who have a child support arrearage and may receive a settlement from the state.
  6. Each organizational unit and administrative body in the executive branch of state government, as defined in KRS 12.010 , the Court of Justice in the judicial branch of state government, and, where feasible, any local government shall provide information to the State Treasurer concerning any debt it has referred to the Department of Revenue for collection under KRS 45.241 .
  7. Each agency, the Court of Justice, and, where feasible, any local government shall provide information to the State Treasurer concerning any debt referred to the Department of Revenue for collection under KRS 45.237 .

History. 4701; 2000, ch. 430, § 17, effective July 14, 2000; 2004, ch. 118, § 2, effective July 13, 2004; 2004, ch. 192, § 4, effective April 21, 2004; 2005, ch. 85, § 59, effective June 20, 2005; 2005, ch. 99, § 104, effective June 20, 2005; 2006, ch. 252, Pt. XVI, § 1, effective April 25, 2006; 2013, ch. 88, § 2, effective June 25, 2013.

NOTES TO DECISIONS

1.Deduction from Claim.

It is the duty of the treasurer to deduct from a claim any sum due the state from the debtor. Long v. McDowell, 107 Ky. 14 , 52 S.W. 812, 21 Ky. L. Rptr. 605 , 1899 Ky. LEXIS 122 ( Ky. 1899 ); Stone v. Mayo, 55 S.W. 700, 21 Ky. L. Rptr. 1559 , 1900 Ky. LEXIS 551 (Ky. Ct. App. 1900).

2.Erroneously Paid Compensation.

Although Commonwealth’s attorney was entitled under theory of subrogation to claim against Commonwealth for amount which substitute, employed by him during time he was in the army, would have been entitled to receive as a pro tem Commonwealth’s attorney, he could not recover such sum from the Treasury, but was only entitled to have it credited against the amount being withheld by the Commonwealth out of future compensation due Commonwealth’s attorney, to reimburse it for compensation erroneously paid to him while he was in the army. Whitworth v. Miller, 302 Ky. 24 , 193 S.W.2d 470, 1946 Ky. LEXIS 592 ( Ky. 1946 ).

University was properly granted summary judgment on a former medical director’s wage and hour claim where although the university’s governmental immunity had been waived under Ky. Rev. Stat. ch. 337, the director failed to counter the university’s evidence that he had been overpaid by a specific amount, and thus, under former Ky. Rev. Stat. Ann. § 44.030 , the university was entitled to withhold wages. Lipson v. Univ. of Louisville, 556 S.W.3d 18, 2018 Ky. App. LEXIS 201 (Ky. Ct. App. 2018).

3.Public Assistance Grant.

A citizen eligible in all respects for public assistance grant under KRS Chapter 205 does not have a claim against the Commonwealth for assistance payments as the word “claim” is used in this section. Powell v. Offutt, 380 S.W.2d 209, 1964 Ky. LEXIS 281 ( Ky. 1964 ).

4.Miller Act.

The Miller Act, 40 USCS § 270a, is comparable to this section. Reliance Ins. Co. v. Commonwealth, Dep't of Transp., 576 S.W.2d 231, 1978 Ky. App. LEXIS 653 (Ky. Ct. App. 1978).

5.Set-off Procedure.

This section is merely an extension to the government of the equitable right of set-off which belongs to every creditor, and in those cases it is seldom that the two debts arise out of the same transaction. Reliance Ins. Co. v. Commonwealth, Dep't of Transp., 576 S.W.2d 231, 1978 Ky. App. LEXIS 653 (Ky. Ct. App. 1978).

The set-off procedure authorized by this section by which the Commonwealth may withhold money it owes to a debtor of the Commonwealth is not an “action” within the scope of the statutes of limitations. Metts v. Frankfort, 665 S.W.2d 318, 1984 Ky. App. LEXIS 477 (Ky. Ct. App. 1984).

The Commonwealth could not use the set-off procedure of this section to set off money appropriated to the City of Frankfort by the General Assembly against unpaid bills incurred by the city for the relocation of its sewer lines in connection with three highway improvements; it would be against public policy to allow this section to be used against such legislative appropriations which benefit the residents of Frankfort, and indirectly benefit the residents of the Commonwealth as a whole. Metts v. Frankfort, 665 S.W.2d 318, 1984 Ky. App. LEXIS 477 (Ky. Ct. App. 1984).

6.Nature of Debt.
7.— Taxes.

There is no distinction between taxes arising from the project from which the fund was created and other projects or ventures by the same debtor. Reliance Ins. Co. v. Commonwealth, Dep't of Transp., 576 S.W.2d 231, 1978 Ky. App. LEXIS 653 (Ky. Ct. App. 1978).

Opinions of Attorney General.

Amounts of “excess” advancements, for flood relief under federal-state disaster assistance agreements, made to the counties may be recouped by the state by deducting such amounts from other funds due the counties. OAG 69-419 .

The Finance Department’s (now Finance and Administration Cabinet) policy of applying the provisions of this section, in withholding payments to circuit clerks delinquent in the remittance of excess fees until such time as their liability is satisfied, is both an economic and efficacious one. OAG 70-604 .

Where a county was delinquent in payments to the county employees’ retirement fund, which is a state fund under KRS 78.520 , and the board of trustees of the county employees’ retirement system proceeded under KRS 78.535 to collect this arrearage and the State Treasurer under the authority of this section paid the arrearage to the retirement system fund out of funds which had been granted to the delinquent county by the state public defender’s office pursuant to KRS 31.050 and 31.160, subsequently issuing a check to the delinquent county only for the amount of the grant from the public defender’s office less the retirement fund arrearage, this action violated neither Ky. Const., § 230 or KRS 41.110 , KRS 44.030 being considered an exception to the provisions of that section. OAG 73-561 .

Where a state check, payable to a corporation, representing the release and refund of a cash bond filed with the department of reclamation is held by the State Treasurer it should be credited, pursuant to this section, towards the obligation of the corporation under a claim filed by the division of unemployment insurance for nonpayment of unemployment contributions; and thus the corporation has no funds in the hands of the treasurer to be attached by a subsequent levy against the corporation by the internal revenue service and the law to determine the priority of competing liens does not apply. OAG 74-666 .

By virtue of its lien a lienor is a statutory assignee of the tax debtor. OAG 80-15 .

Delinquent taxes are a debt owed to the state by the assignor. OAG 80-15 .

Since delinquent taxes are a debt to the state, under this section, a lien for taxes, under KRS 134.420 , which has accrued is superior to a materialman’s lien, under KRS 376.230 , thereafter filed and perfected. OAG 80-15 .

The Finance Department (now Finance and Administration Cabinet) acted legally in deducting $2,500 from a jailer’s dieting fee check where the jailer owed the state $2,500 for dieting fees that had been illegally paid out to the jailer on prior occasions. OAG 80-286 .

Research References and Practice Aids

Cross-References.

Taxes to be deducted from claim against state, KRS 134.170 .

Kentucky Law Journal.

Notes, Effective Child Support Enforcement in Kentucky: The Tax Refund Intercept Program, 74 Ky. L.J. 667 (1985-86).

44.040. Mileage allowance, how computed.

When any allowance for mileage is made by the state, the number of miles shall be computed upon the route most usually traveled.

History. 341.

Opinions of Attorney General.

Where an officer conveys different types of prisoners or patients at the same time to institutions operated by different departments, he shall apportion the mileage cost to each department. OAG 62-713 .

44.045. Motor vehicles, purchase for state use — License plates — Markings and administrative regulations.

  1. A passenger motor vehicle or vehicles may be purchased by the Finance and Administration Cabinet for the use of the Governor and the Lieutenant Governor.
  2. Motor vehicles, including passenger motor vehicles, may be purchased by the Finance and Administration Cabinet as are deemed necessary by the secretary of the Finance and Administration Cabinet or by the secretary of the Transportation Cabinet for the discharge of the authorized duties and functions of the various agencies of the state. The vehicles shall be used for official purposes only and for no other purposes. The assignment of passenger motor vehicles to specific individuals shall be discouraged but may be made upon approval by the secretary of the Finance and Administration Cabinet of a written request to make the assignment by the head of the agency involved.
  3. All motor vehicles purchased pursuant to this section shall be issued official license plates and shall bear on one (1) door on each side the great seal of the Commonwealth, and the words “For official use only.” It shall not be necessary that the vehicles purchased pursuant to subsections (1), (4), and (5) of this section bear the seal and the words.
  4. The Department of Revenue, Justice and Public Safety Cabinet, and the Department of Law may, upon approval by the secretary of the Finance and Administration Cabinet of a written request by the head of the agency involved, register a vehicle or vehicles under KRS 186.020 and be issued regular license plates. The vehicles shall be used for investigatory purposes only and for no other purposes.
  5. The Administrative Office of the Courts may register a vehicle or vehicles used by Justices and Judges of the Supreme Court and Court of Appeals under KRS 186.020 and be issued regular license plates.
  6. The secretary of the Finance and Administration Cabinet may adopt administrative regulations pursuant to KRS Chapter 13A necessary to govern the use of those state-owned vehicles acquired pursuant to the provisions of this section.
  7. Any person violating subsections (2) and (4) of this section shall, on conviction thereof, be subject to the penalties prescribed in KRS 44.990 .

History. Enact. Acts 1968, ch. 175, § 1; 1974, ch. 74, Art. II, § 9(1); 1974, ch. 74, Art. V, § 24(1); 1990, ch. 28, § 1, effective July 13, 1990; 1996, ch. 305, § 1, effective July 15, 1996; 2007, ch. 85, § 124, effective June 26, 2007.

Legislative Research Commission Note.

(8/18/2011). 2009 Ky. Acts ch. 12, relating to the reorganization of the Finance and Administration Cabinet, instructs the Reviser of Statutes to correct statutory references to agencies and officers whose names have been changed in that Act. Such a correction has been made in subsection (6) of this section.

Compiler's Notes.

This section has been reprinted to correct errors appearing in the bound volume.

Legislative Research Commission Note.

(6/26/2007). 2005 Ky. Acts ch. 85, relating to the creation and organization of the Finance and Administration Cabinet, instructs the Reviser of Statutes to correct statutory references to agencies and officers whose names have been changed in that Act. Such a correction has been made in this section.

Research References and Practice Aids

Cross-References.

State-owned vehicles, marking, exceptions, KRS 186.065 .

44.050. Motor vehicles, when may be purchased out of state funds.

The Department of Military Affairs is hereby authorized to purchase from state funds motor trucks to be used in the carrying out of the functions of this department, and it is further provided that the Department of Military Affairs may acquire motor vehicles by gift or transfer from the federal government for use in said department.

History. 2739-9, 2739g-70, 2739g-71, 2739g-74, 2739g-77: amend. Acts 1942, ch. 77, § 2; 1944, ch. 27; 1950, ch. 77; 1968, ch. 175, § 3.

Research References and Practice Aids

Cross-References.

State Police division may purchase and use motor vehicles, KRS 16.070 .

44.055. Insuring state vehicles — Blanket liability policy — Effect on sovereign immunity — Eligibility of insurers.

  1. Any state agency, as defined in KRS Chapter 12, may in its discretion, for the protection of the public and its employees, expend state funds to purchase policies of insurance of all kinds deemed advisable covering vehicles, including boats, owned by the state and operated by state employees when in the conduct of official business. The executive director of insurance, upon recommendation of the secretary of the Finance and Administration Cabinet, shall initiate and be responsible for the purchase of a blanket liability insurance policy to cover the officers and employees of the several state agencies and shall determine, by administrative regulation, the policy limits that shall be applicable to the persons covered in each such affected agency not to exceed the limit prescribed in KRS 49.040 .
  2. Nothing contained in this section shall be construed to be a waiver of sovereign immunity and claims against the Commonwealth, its agencies, officers, employees, or insurers may be asserted only in the manner set forth in KRS 49.040 to 49.180 .
  3. Policies authorized by this section shall be purchased only from insurers authorized to do business in this state and shall be countersigned by a licensed resident agent.

HISTORY: Enact. Acts 1958, ch. 125; 1960, ch. 180; 1994, ch. 372, § 1, effective July 15, 1994; 2017 ch. 74, § 61, effective June 29, 2017.

NOTES TO DECISIONS

1.Sovereign Immunity.

Authorization of state agencies to purchase motor vehicle liability insurance does not waive sovereign immunity. Ginter v. Montgomery County, 327 S.W.2d 98, 1959 Ky. LEXIS 71 ( Ky. 1959 ).

Opinions of Attorney General.

A person injured by the negligence of a state employee has an option whether to proceed through the board of claims or against the individual employee, but the remedy, once elected, is exclusive. OAG 61-994 .

In connection with the operation of state-owned vehicles in the conduct of official business and operated by state employees who work for the authority, the capital plaza authority may, in its discretion, purchase liability policies pursuant to this section. OAG 71-347 .

The authority granted by this section applies only to state-owned vehicles and does not permit purchase by state agencies of liability insurance covering privately owned vehicles driven on state business and no funds have been budgeted for the purchase of a blanket liability policy for state-owned vehicles as provided for in this section. OAG 75-60 .

Research References and Practice Aids

Cross-References.

Blanket and group insurance, KRS 304.18-010 et seq.

44.060. Expense of operating vehicle used by state officer, employee, or agent.

When any state officer, member of a state board or commission, or any subordinate officer, agent, or employee thereof is authorized by law to and does incur, in the discharge of his official duties, any expense incident to traveling in his own motor vehicle, the amount allowed for such expense shall be fixed by the secretary of the Finance and Administration Cabinet which sum shall include depreciation and investment charges incident to the operation of the motor vehicle.

History. 2739g-72: amend. Acts 1948, ch. 85; 1958, ch. 85; 1968, ch. 60, § 1; 1974, ch. 296, § 1; 1974, ch. 74, Art. II, § 9(1); 1978, ch. 155, § 41, effective January 1, 1978.

NOTES TO DECISIONS

Cited in:

Manning v. Sims, 308 Ky. 587 , 213 S.W.2d 577, 1948 Ky. LEXIS 864 , 5 A.L.R.2d 1154 ( Ky. 1948 ).

Opinions of Attorney General.

Travel by privately owned aircraft is authorized and reimbursement from the Department of Finance (now Finance and Administration Cabinet) will be on the basis of mileage over the nearest traveled route. OAG 62-1034 .

Although the increased mileage allowance would not directly apply to a circuit clerk since he is a county official, it shows a legislative intent that a credit of ten cents per mile for official travel of a circuit clerk would not be unreasonable. OAG 68-231 .

A regular and well-publicized schedule of trips by the clerk or his deputy to outlying areas in which a sizable demand for this service exists and is used would qualify for travel reimbursement if properly documented to show the purpose and official necessity of each trip and the distance traveled on each trip. OAG 68-231 .

When this section is read together with KRS 45.180 (now repealed) it appears that it was the intent of the Legislature that state employees stationed in a city who must proceed regularly by vehicle from place to place within the city boundaries in the actual and necessary performance of their duties should be reimbursed for such travel expenses. OAG 73-42 .

State department heads have no authority to establish a maximum level for reimbursements for official state travel involving motor vehicle, food, lodging, expenses, etc., which levels would constitute less than ten cents per mile for a privately owned motor vehicle and less than the actual expenses for food and lodging (and other expenses) presently reimbursable under the administrative regulations and statute. OAG 73-658 .

An extradition agent’s meals and lodging are restricted to that generally allowed by Department of Finance (now Finance and Administration Cabinet) travel regulations. OAG 80-387 .

The state agent in extradition is entitled to 18 cents per mile, pursuant to this section, plus five cents per mile; in addition, he is entitled to any other necessary expenses he pays in reclaiming and returning the fugitive, including the costs of food and lodging for himself and for the prisoner. OAG 80-387 .

KRS 44.060 , 45.180 (repealed) and 45.300 (repealed) when read together, in pari materia, establish that the State Board of Accountancy is a state agency for purposes of observing state agency travel regulations. OAG 82-69 .

Although KRS 421.015 refers narrowly to a mileage allowance for witnesses in court, under the doctrine of in pari materia, i.e., reading related statutes together, witnesses who must travel to another county for appearance in Circuit Court would be entitled to the mileage allowance given state employees, and would be entitled to reimbursement for their necessary food and lodging costs as authorized in KRS 44.060 , 45.101 and 45.180 (now repealed). OAG 83-117 .

Research References and Practice Aids

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. III, 32 at 936.

44.065. Reciprocal agreements to offset claim of any person against the Commonwealth to debt of that person owed to any federal, state, or local government.

  1. Notwithstanding any other provision of the Kentucky Revised Statutes, and pursuant to the provisions of 31 U.S.C. sec. 3716(b) and (h)(1), the Finance and Administration Cabinet, at the request of any executive, judicial, or legislative agency of the Commonwealth, may enter into a reciprocal agreement with the United States government to offset the claim of any person against the Commonwealth to any debt of that person owed to the United States government which has been certified by the United States government as final, due, and owing, with all appeals and legal actions having been waived or exhausted, and to offset any nontax claim of any person against the United States government to any liquidated debt of that person owed to the Commonwealth.
  2. Notwithstanding any other provision of the Kentucky Revised Statutes, the Finance and Administration Cabinet, at the request of any executive, judicial, or legislative agency of the Commonwealth, may enter into a reciprocal agreement with any state, as defined in KRS 446.010 , to offset the claim of any person against the Commonwealth to any debt of that person owed to any state which has certified the debt as final, due, and owing, with all appeals and legal actions having been waived or exhausted, and to offset any claim of any person against any state to any liquidated debt of that person owed to the Commonwealth.
  3. In the case of multiple creditors who have certified liquidated debt against the same person on a claim against the Commonwealth, pursuant to this section and KRS 44.030 , the debts of the Commonwealth, counties, cities, urban-county governments, consolidated local governments, and charter county governments shall be credited first in the priority established in KRS 44.030 , and if there is any balance due the claimant after settling the whole demands of the Commonwealth, counties, cities, urban-county governments, consolidated local governments, and charter county governments, the balance shall be credited to the liquidated debts certified by the United States government and any other state, as defined in KRS 446.010 , in the order that the claims were filed with the Treasury. If there is a balance due the claimant after satisfaction of all liquidated debts as itemized in this section or any court-ordered payments, the balance shall be paid to the claimant.

History. Enact. Acts 2006, ch. 252, Pt. XVI, § 2, effective April 25, 2006; 2011, ch. 2, § 104, effective June 8, 2011.

Legislative Research Commission Note.

(4/25/2006). This statute, as created by 2006 Ky. Acts ch. 252, Pt. XVI. sec. 2, contained internal references in subsections (2) and (3) to “KRS 446.010(30).” Under KRS 7.136(1)(e), these references have been changed in codification to “KRS 446.010(31)” by the Reviser of Statutes to reflect the insertion of a new subsection (24) in KRS 446.020 and the resulting renumbering of succeeding subsections in 2006 Ky. Acts ch. 149, sec. 237.

Board of Claims

44.070. Board of Claims — Limitation on damage awards — Hearing officers — Asbestos related claims. [Renumbered]

History. Enact. Acts 1946, ch. 189, §§ 1, 3, par. 1; 1950, ch. 50, § 1; 1956 (1st Ex. Sess.), ch. 7, Art. XIII, § 1; 1958, ch. 52, § 1; 1960, ch. 25, § 1; 1972, ch. 234, § 1; 1976, ch. 326, § 2; 1978, ch. 15, § 1, effective June 17, 1978; 1986, ch. 279, § 1, effective July 15, 1986; 1986, ch. 499, § 3, effective July 15, 1986; 2000, ch. 304, § 4, effective July 14, 2000; renumbered 2017, ch. 74, § 4, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.040 effective June 29, 2017.

44.071. Jurisdiction of Board of Claims as to municipal maintenance of state-owned traffic control devices.

  1. The Board of Claims, created by KRS 44.070 , is hereby vested with full power, authority, and jurisdiction to investigate, hear proof, and compensate persons for damages sustained to either person or property as approximate result of negligence on the part of any municipality, or any of its officers, agents, or employees while acting within the scope of their employment by the municipality, or any agency thereof, relating to the maintenance by the municipality of state-owned traffic control devices pursuant to a contract with the Commonwealth.
  2. Claims for personal injury or property damage against any municipality, or any of its officers, agents, or employees while acting within the scope of their employment of the municipality, arising out of negligence in the maintenance of state-owned traffic control devices pursuant to a contract with the Commonwealth, shall be limited and reduced in the same manner as described in KRS 44.070 with respect to claims against the Commonwealth.
  3. It is the intention of subsections (1) and (2) of this section to provide every municipality and agency thereof, and their respective officers, agents, or employees with the same liability protection, restrictions, and reductions when such municipalities and agencies are performing maintenance on state-owned traffic control devices pursuant to a contract with the Commonwealth as the Commonwealth and its agencies, officers, and employees would enjoy if performing the work itself.

History. Enact. Acts 1990, ch. 225, § 1, effective July 13, 1990.

NOTES TO DECISIONS

1.Loss of Consortium Claim.

Wife’s loss of spousal consortium claim in the Kentucky Board of Claims arising from an injury to her husband caused by a malfunctioning pedestrian control device was barred by KRS 44.070(1), which precluded liability for collateral or dependent claims. City of Danville v. Goode, 122 S.W.3d 591, 2003 Ky. App. LEXIS 314 (Ky. Ct. App. 2003).

2.Counties.

KRS 44.071(1) only vests the Kentucky Board of Claims with jurisdiction over “municipalities”; counties are unincorporated political subdivisions of the state, preexisting its formation, whose existence is provided for constitutionally in Ky. Const., §§ 63, 64, and 65, and therefore, an unincorporated county government is not a “municipality” under Kentucky law, and the Board of Claims has no jurisdiction over claims against a county. Lexington-Fayette Urban County Gov't v. Smolcic, 142 S.W.3d 128, 2004 Ky. LEXIS 182 ( Ky. 2004 ).

Research References and Practice Aids

Treatises

Caldwell’s Kentucky Form Book, 5th Ed., Practice Context for Kentucky Board of Claims, § 8.00.

44.071. Jurisdiction of Board of Claims as to municipal maintenance of state-owned traffic control devices. [Renumbered]

History. Enact. Acts 1990, ch. 225, § 1, effective July 13, 1990; renumbered 2017, ch. 74, § 5, effective June 29, 2017.

Compiler’s Notes.

This section was renumbered as KRS § 49.050 effective June 29, 2017.

44.072. Legislative intent as to sovereign immunity in negligence claims. [Renumbered]

History. Enact. Acts 1986, ch. 499, § 1, effective July 15, 1986; renumbered 2017, ch. 74, § 6, effective June 29, 2017.

Compiler’s Notes.

This section was renumbered as KRS § 49.060 effective June 29, 2017.

44.073. State institutions of higher education declared agencies of state government — Jurisdiction of Board of Claims — Sovereign immunity. [Renumbered]

History. Enact. Acts 1986, ch. 499, § 2, effective July 15, 1986; renumbered 2017, ch. 74, § 7, effective June 29, 2017.

Compiler’s Notes.

This section was renumbered as KRS § 49.070 effective June 29, 2017.

44.075. Source of payment of expenses of Workers’ Compensation Board. [Repealed]

History. Enact. Acts 1960, ch. 25, § 4; repealed by 2017 ch. 74, § 106, effective June 29, 2017.

Compiler’s Notes.

This section (Enact. Acts 1960, ch. 25, § 4), was repealed by Acts 2017, ch. 74, § 106, effective June 29, 2017.

44.080. Sessions of board — Rules — Subpoenas — Oaths. [Repealed]

History. Enact. Acts 1946, ch. 189, § 5; 1948, ch. 193; repealed by 2017 ch. 74, § 106, effective June 29, 2017.

Compiler’s Notes.

This section (Enact. Acts 1960, ch. 25, § 4), was repealed by Acts 2017, ch. 74, § 106, effective June 29, 2017.

44.084. Venue of hearings. [Renumbered]

History. Enact. Acts 1960, ch. 25, § 2; renumbered 2017, ch. 74, § 8, effective June 29, 2017.

Compiler’s Notes.

This section was renumbered as KRS § 49.080 effective June 29, 2017.

44.086. Investigation of claims — Additional information on claims under $1,000 — Hearings — Order — Review. [Renumbered]

History. Enact. Acts 1960, ch. 25, § 3; 1978, ch. 299, § 1, effective June 17, 1978; 1982, ch. 355, § 1, effective July 15, 1982; 2000, ch. 304, § 2, effective July 14, 2000; renumbered 2017, ch. 74, § 9, effective June 29, 2017.

Compiler’s Notes.

This section was renumbered as KRS § 49.090 effective June 29, 2017.

44.090. Defense to claims. [Renumbered]

History. Enact. Acts 1946, ch. 189, § 6; 1950, ch. 50, § 2; 1986, ch. 499, § 4, effective July 15, 1986; renumbered 2017, ch. 74, § 10, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.100 effective June 29, 2017.

44.100. Compensation of board, assistant attorneys general or attorneys appointed by Governor — Payment of awards — Cost of operation. [Renumbered]

History. Enact. Acts 1946, ch. 189, §§ 7, 8; 1950, ch. 50, § 3; 1956 (1st Ex. Sess.), ch. 7, Art. XIII, § 2; 1958, ch. 52, § 2; 1960, ch. 25, § 5; 1986, ch. 499, § 5, effective July 15, 1986; renumbered 2017, ch. 74, § 11, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.110 effective June 29, 2017.

44.110. When claims must be presented. [Renumbered]

History. Enact. Acts 1946, ch. 189, § 3(a); 1950, ch. 50, § 4; 1958, ch. 52, § 5; 1962, ch. 304, § 2; 1966, ch. 255, § 53; 1986, ch. 499, § 6, effective July 15, 1986; 1990, ch. 176, § 1, effective July 13, 1990; renumbered 2017, ch. 74, § 12, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.120 effective June 29, 2017.

44.115. Purpose of exception to limitation of KRS 44.110. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1962, ch. 304, § 1) was repealed by Acts 1968, ch. 152, § 168.

44.120. Conditions of awards. [Renumbered]

History. Enact. Acts 1946, ch. 189, § 2; 1950, ch. 50, § 5; 1960, ch. 25, § 6; renumbered 2017, ch. 74, § 13, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.130 effective June 29, 2017.

44.130. Enforcement and entry of awards. [Renumbered]

History. Enact. Acts 1946, ch. 189, § 4; renumbered 2017, ch. 74, § 14, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.140 effective June 29, 2017.

44.140. Appeal from award or judgment of board. [Renumbered]

History. Enact. Acts 1946, ch. 189, § 9; 1958, ch. 52, § 3; 1960, ch. 25, § 7; 1980, ch. 291, § 1, effective July 15, 1980; 1982, ch. 355, § 2, effective July 15, 1982; 1984, ch. 310, § 1, effective July 13, 1984; 2000, ch. 304, § 3, effective July 14, 2000; renumbered 2017, ch. 74, § 15, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.150 effective June 29, 2017.

44.150. Appeal to Court of Appeals. [Renumbered]

History. Enact. Acts 1948, ch. 189, § 10; renumbered 2017, ch. 74, § 16, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.160 effective June 29, 2017.

44.160. Exclusiveness of board’s award or judgment. [Renumbered]

History. Enact. Acts 1946, ch. 189, § 3(b); 1950, ch. 50, § 6; 1958, ch. 52, § 4; 1986, ch. 499, § 7, effective July 15, 1986; renumbered 2017, ch. 74, § 17, effective June 29, 2017.

Compiler's Notes.

This section was renumbered as KRS § 49.170 effective June 29, 2017.

44.165. Monetary threshold for claims brought before board. [Renumbered]

History. Enact. Acts 2000, ch. 304, § 1, effective July 14, 2000; renumbered 2017, ch. 74, § 18, effective June 29, 2017.

Compiler’s Notes.

This section was renumbered as KRS § 49.180 effective June 29, 2017.

44.170. Transfer of pending cases. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1960, ch. 25, § 8) was repealed by Acts 1966, ch. 255, § 283.

Contract Claims

44.260. Definitions. [Amended and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 1; 1974, ch. 181, § 1) was amended and reenacted by Acts 1978, ch. 110, § 48, effective January 1, 1979, as KRS 45A.240 .

44.270. Action on contract — Damages — Limitations. [Repealed and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 2, in part; 1974, ch. 181, § 2; 1976, ch. 297, § 1) was repealed and reenacted by Acts 1978, ch. 110, § 49, effective January 1, 1979 as KRS 45A.245 .

44.280. Findings of court. [Amended and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 2, in part; 1974, ch. 181, § 3) was amended and reenacted by Acts 1978, ch. 110, § 50, effective January 1, 1979, as KRS 45A.250 .

44.290. Rules and regulations governing administrative hearing — Procedure. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 3) was repealed by Acts 1974, ch. 181, § 8.

44.300. Appeals from Circuit Court. [Repealed and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 4; 1974, ch. 181, § 4) was repealed and reenacted by Acts 1978, ch. 110, § 51, effective January 1, 1979, as KRS 45A.255 .

44.310. Limitations on claims. [Repealed and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 6; 1974, ch. 181, § 5) was repealed and reenacted by Acts 1978, ch. 110, § 52, effective January 1, 1979, as KRS 45A.260 .

44.320. One recovery only. [Repealed and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 5) was repealed and reenacted by Acts 1978, ch. 110, § 53, effective January 1, 1979, as KRS 45A.265 .

44.330. Presentation of judgment for payment — Appropriations. [Amended and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1966, ch. 180, § 7; 1974, ch. 74, Art. II, § 9(1); 1974, ch. 181, § 6) was amended and reenacted by Acts 1978, ch. 110, § 54, effective January 1, 1979, as KRS 45A.270 .

44.340. Judgments against Commonwealth up to $500,000 deemed necessary governmental expense. [Amended and Reenacted.]

Compiler’s Notes.

This section (Enact. Acts 1974, ch. 181, § 7) was amended and reenacted by Acts 1978, ch. 110, § 55, effective January 1, 1979, as KRS 45A.275 .

Penalties

44.990. Penalties.

Any person who violates any of the provisions of KRS 44.045 shall be fined not less than fifty dollars ($50) nor more than five hundred dollars ($500) for each offense.

History. 2739g-76: amend. Acts 1968, ch. 175, § 2.

CHAPTER 45 Budget and Financial Administration

45.0005. Definitions for chapter.

As used in this chapter:

  1. “Branch budget bill” shall have the same meaning as in KRS 48.010 ;
  2. “Document” means any physical embodiment of information or ideas, regardless of form or characteristic, including electronic versions thereof;
  3. “Warrant” means a printed or electronic authorization from the Finance and Administration Cabinet for the State Treasurer to issue a check; and
  4. “Writing” or “written” means letters, words, or numbers, or their equivalent, set down by handwriting, typewriting, printing, photostating, photographing, magnetic impulse, mechanical or electronic recording, or other form of data compilation.

History. Enact. Acts 1998, ch. 118, § 15, effective July 15, 1998; ch. 120, § 5, effective July 15, 1998; 2009, ch. 78, § 30, effective June 25, 2009.

Legislative Research Commission Notes.

(7/15/98). This section was created by 1998 Ky. Acts chs. 118 and 120 which have been codified together. Section 15 of Acts ch. 118 is substantively identical to subsection (3) of Section 5 of Acts ch. 120.

Research References and Practice Aids

2020-2022 Budget Reference.

See Transportation Cabinet Budget, 2020 Ky. Acts ch. 93, Pt. I, A, 4, (8) at 950.

45.001. Capital Development Committee.

  1. The Capital Development Committee is created.   The committee shall ensure the proper coordination of state government initiatives which impact the City of Frankfort and Franklin County government and are unique to the seat of state government.
  2. The committee shall meet at least semiannually at a time and place announced by the chairperson.
  3. The membership of the committee shall consist of the following members or their designees:
    1. The mayor of the city of Frankfort;
    2. The county judge/executive of Franklin County;
    3. The secretary of the Finance and Administration Cabinet;
    4. The secretary of the Tourism, Arts and Heritage Cabinet;
    5. The secretary of the Education and Workforce Development Cabinet;
    6. The commissioner of the Kentucky Department of Tourism;
    7. The chairman of the Frankfort/Franklin County Tourist and Convention Commission;
    8. A citizen at large, who is a resident of Franklin County, appointed by the Franklin County judge/executive; and
    9. A citizen at large, who is a resident of Frankfort, appointed by the mayor of the city of Frankfort.

      The citizen-at-large members of the committee shall be appointed to a term of four (4) years each.

  4. The Governor shall appoint the chairperson of the committee.
  5. Members of the committee shall serve without compensation.
  6. The Finance and Administration Cabinet shall provide administrative support to the committee.

HISTORY: Enact. Acts 1984, ch. 25, § 1, effective July 13, 1984; 1996, ch. 194, § 2, effective July 15, 1996; 1998, ch. 83, § 6, effective July 15, 1998; 2005, ch. 85, § 60, effective June 20, 2005; 2005, ch. 95, § 11, effective June 20, 2005; 2006, ch. 211, § 12, effective July 12, 2006; 2009, ch. 11, § 9, effective June 25, 2009; 2009, ch. 16, § 6, effective June 25, 2009; 2010, ch. 65, § 2, effective July 15, 2010; 2018 ch. 69, § 2, effective July 14, 2018.

Legislative Research Commission Notes.

(6/29/2017). Under the authority of KRS 7.136(2), one or more references to the “Kentucky Department of Travel and Tourism” in this statute have been changed in codification to the “Kentucky Department of Tourism” to reflect the reorganization of certain parts of the Executive Branch, as set forth in Executive Order 2016-856 and confirmed by the General Assembly in 2017 Ky. Acts ch. 110.

45.010. Definitions. [Repealed.]

Compiler’s Notes.

This section (1992b-2: amend. Acts 1968, ch. 2, § 1; 1968, ch. 119, § 13; 1974, ch. 260, § 1) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.010 .

45.011. Capital outlay and printing — Contracts in anticipation of appropriations.

The Governor, the Chief Justice, and the Legislative Research Commission, or their designees may grant special authority for their budget units, during any fiscal year, to enter into contracts for capital outlay or for state printing, in anticipation of appropriations already made for the ensuing fiscal year or biennium. Contracts made before the close of a fiscal year under such authority shall be treated as deferred charges to the appropriations and expenses of the next fiscal year or biennium. The grant of such authority and a report of all contracts made under this section shall be reported to the Finance and Administration Cabinet.

History. Enact. Acts 1982, ch. 450, § 41, effective July 1, 1983.

NOTES TO DECISIONS

1.Approval of Contract Agreement.

Where plaintiff, a contractor who was a successful bidder on proposed construction approved by the state Property and Building Commission, executed a “contract agreement” and a performance bond and the project was abandoned without the “contract agreement” being signed by the state Property and Building Commission or approved by the Department of Finance (now Finance and Administration Cabinet) there was no contract with the Commonwealth and plaintiff could not recover damages based upon lost profits. Cravens & Cravens, Inc. v. Department of Finance, 312 S.W.2d 622, 1958 Ky. LEXIS 235 ( Ky. 1958 ) (decided under prior law).

45.020. Expenditures to be authorized by appropriation acts — Refund of funds illegally received. [Repealed.]

Compiler’s Notes.

This section (1992b-6: amend. Acts 1968, ch. 119, § 14; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.111 .

45.021. Contracts for municipal services to state agencies by city of Frankfort.

The Finance and Administration Cabinet, within budgetary limits fixed by any appropriations made by the General Assembly for such purpose, shall contract with the city of Frankfort for the provision by the city to state agencies located at the seat of government for fire and police protection of state-owned property and other municipal services as are provided by the city to commercial and industrial taxpayers residing in the city of Frankfort.

History. Enact. Acts 1982, ch. 450, § 47, effective July 1, 1983.

45.030. Biennial budget report to be prepared. [Repealed.]

Compiler’s Notes.

This section (1992b-7: amend. Acts 1956, ch. 2, § 1, effective January 23, 1956; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.020 , 48.100 .

45.031. Federal funds — State clearinghouse function.

  1. Any department, board, commission, agency, advisory council, interstate compact, corporate body, or instrumentality of the Commonwealth of Kentucky applying for federal funds, aids, loans, or grants shall file a summary notification of the intended application with the Department for Local Government in accordance with the existing A-95 procedures.
  2. When as a condition to receiving federal funds, the Commonwealth of Kentucky is required to match the federal funds, a statement shall be filed with the notice of intent or summary of the application stating:
    1. The amount and source of state funds needed for matching purposes;
    2. The length of time the matching funds shall be required;
    3. The growth of the program;
    4. How the program will be evaluated;
    5. What action will be necessary should the federal funds be canceled, curtailed, or restricted; and
    6. Any other financial and program management data required by the Finance and Administration Cabinet or by law.
  3. Any application for federal funds, aids, loans, or grants which will require state matching or replacement funds at the time of application or at any time in the future, must be approved by the secretary of the Finance and Administration Cabinet, the Legislative Research Commission, and the Chief Justice for their respective branches of government or their designated agents prior to its filing with the appropriate federal agency. Any application for federal funds, aids, loans, or grants which will require state matching or replacement funds at the time of application or at any time in the future, when funds have not been appropriated for that express purpose, must be approved by the General Assembly, if in session. When the General Assembly is not in session, the application shall be reported to and reviewed by the Interim Joint Committee on Appropriations and Revenue, as provided by KRS 48.500(3).
  4. When any federal funds, aids, loans, or grants are received by any department, board, commission or agency of the Commonwealth of Kentucky, a report of the amount of funds received shall be filed with the Finance and Administration Cabinet; and this report shall specify the amount of funds which would reimburse an agency for indirect costs as provided for under OMB Circular A-87.
  5. The secretary of the Finance and Administration Cabinet may refuse to issue his warrant for the disbursement of any state or federal funds from the State Treasury as the result of any application which is not approved as provided by this section, or in regard to which the statement or reports required by this section were not filed.
  6. The secretary of the Finance and Administration Cabinet shall be responsible for the orderly administration of this section and for issuing the appropriate guidelines and regulations from each source of fund used.

History. Enact. Acts 1982, ch. 450, § 49, effective July 1, 1983; 1994, ch. 508, § 14, effective July 15, 1994; 1998, ch. 69, § 16, effective July 15, 1998; 2007, ch. 47, § 27, effective June 26, 2007; 2010, ch. 117, § 33, effective July 15, 2010; 2011, ch. 73, § 5, effective June 8, 2011.

45.040. Contents of biennial budget report. [Repealed.]

Compiler’s Notes.

This section (1992b-9: amend. Acts 1974, ch. 260, § 2) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.110 .

45.045. Budget recommendations. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1978, ch. 187, § 6, effective June 17, 1978; 1978, ch. 188, § 5, effective June 17, 1978; 1980, ch. 394, § 12, effective July 1, 1980) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.100 .

45.046. Picked-up employee pension contributions not considered an increase or decrease in employee salaries.

The pick up of employee pension contributions pursuant to Acts 1982, ch. 166, shall not be construed as either an increase or a decrease in the amount budgeted for employee salaries by the state or any other employer affected by Acts 1982, ch. 166.

History. Enact. Acts 1982, ch. 166, § 14, effective July 15, 1982.

45.050. Appropriation and revenue acts — Adoption — Questions of interpretation. [Repealed.]

Compiler’s Notes.

This section (1992b-8, 1992b-24: amend. Acts 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.020 to 48.060 , 48.200 , 48.300 .

45.060. Forms for budget estimates. [Repealed.]

Compiler’s Notes.

This section (1992b-10: amend. Acts 1970, ch. 10, § 1; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.020 to 48.060 , 48.200 , 48.300 .

45.070. Estimates to be submitted by heads of budget units. [Repealed.]

Compiler’s Notes.

This section (1992b-11: amend. Acts 1970, ch. 10, § 2; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.020 to 48.060 , 48.200 , 48.300 .

45.080. Continuous financial planning. [Repealed.]

Compiler’s Notes.

This section (1992b-12: amend. Acts 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.020 to 48.060 , 48.200 , 48.300 .

45.090. Duties of governor in preparation of budget report — Governor-elect to be informed. [Repealed.]

Compiler’s Notes.

This section (1992b-13, 1992b-14: amend. Acts 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.020 to 48.060 , 48.200 , 48.300 .

45.100. Budget report to be printed and transmitted to house of representatives. [Repealed.]

Compiler’s Notes.

This section (1992b-15: amend. Acts 1956, ch. 2, § 2; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.020 to 48.060 , 48.200 , 48.300 .

45.101. Expense accounts of state officers and employees — Receipts — Authority to promulgate administrative regulations.

  1. Except as otherwise provided by law, each state officer or employee who is authorized by law to receive, from corporations or from the State Treasury or from any fund appropriated out of the State Treasury, traveling or other expenses incident to the discharge of official duties shall submit to the Finance and Administration Cabinet information regarding the expenses and necessary receipts as provided by administrative regulation promulgated by the Finance and Administration Cabinet, provided that any expenses in excess of ten dollars ($10) shall be accompanied by a receipt, unless the Finance and Administration Cabinet increases the minimum expense amount for which a receipt is required as provided in this section. The required information and documentation shall be provided before the cabinet shall audit or pay the expenses. The Finance and Administration Cabinet may promulgate an administrative regulation to increase the minimum expense amount for which a receipt is required, not to exceed twenty-five dollars ($25). The Finance and Administration Cabinet may rely on a preaudit performed by the budget unit as a basis for issuing a warrant.
  2. The Finance and Administration Cabinet may promulgate administrative regulations to permit budget units to contract with airlines, railroads, hotels, or other companies for services to a group of their employees while on official travel status. The expenses are to be submitted to the Finance and Administration Cabinet on forms prescribed by the Finance and Administration Cabinet before the cabinet shall audit or pay the expenses.
  3. The Finance and Administration Cabinet may promulgate administrative regulations to permit state officers or employees to assign their claim for reimbursement of travel expenses to airline, railroad, hotel, or other companies in payment of services rendered as provided for in subsections (1) and (2) of this section.
  4. Each state officer or employee who by reason of the duties assigned to the officer’s or employee’s office is required to be at the state capital for the majority of the time, or who has an office located at the state capital, shall not be permitted to charge for expenses except from the state capital to the place where the business the officer or employee is transacting is to be transacted, and from that place back to the state capital, and each officer or employee who is assigned to duty at some place other than the state capital shall only be permitted to charge to the state such expenses as are incurred in going from that place to the place where the business is transacted, and returning. Expenses in going from the state capital or the place where the officer or employee is assigned to duty to the officer’s or employee’s real place of residence, or in return therefrom, shall not be allowed unless it is shown that it was necessary for the officer or employee to make the trip in the discharge of business for the state.
  5. The Finance and Administration Cabinet may promulgate administrative regulations to permit the payment of travel and other expenses incidental to the official activities of formally organized groups sponsored by or otherwise representing state agencies. The payment may be made direct to service establishments in the manner set forth in subsection (3) of this section, by an inter-account bill between budget units, or by reimbursement to the official or other employee who has been designated as the officer-in-charge of the organized group. If it is necessary that one (1) or more state employees or officials travel with the group, their expenses may be included in the total expenses for the group.
  6. The Finance and Administration Cabinet may promulgate administrative regulations allowing heads of budget units to establish imprest cash funds for reimbursement of travel expenses.
  7. Except as provided in KRS Chapter 6, but the provisions of any other laws to the contrary notwithstanding, and in lieu of the reimbursement of travel and other incidental expenses authorized by subsection (1) of this section, the Finance and Administration Cabinet may promulgate administrative regulations to provide for the payment of a fixed expense allowance per day to be established by the secretary of the Finance and Administration Cabinet, plus necessary travel expenses, to each state officer or employee who is authorized by law to be reimbursed for expenses incurred in the discharge of official duties. This payment shall be made from an appropriation for this purpose to a budget unit of a branch of government.

History. Enact. Acts 1982, ch. 450, § 42, effective July 1, 1983; 1997 (1st Ex. Sess.), ch. 4, § 16, effective May 30, 1997.

NOTES TO DECISIONS

1.Out-of-State Expenses.

Expenses of state auditor in attending out-of-state convention were not “expenses” incident to the discharge of his official duties. Shanks v. Commonwealth, 219 Ky. 212 , 292 S.W. 837, 1927 Ky. LEXIS 334 ( Ky. 1927 ) (decided under prior law).

Since it was the duty of the Division of Research and Statistics, under the direction of the Commissioner (now Secretary) of Revenue, to make investigations into matters of taxation in the state or elsewhere, a proposed trip of the Commissioner (now Secretary) of Revenue to Minnesota to attend a tax conference was justified and would probably have been profitable to the Commonwealth. Reeves v. Talbott, 289 Ky. 581 , 159 S.W.2d 51, 1941 Ky. LEXIS 37 ( Ky. 1941 ) (decided under prior law).

2.—Approval.

To secure refund for out-of-state travel expense, claim must have been approved by both the Commissioner of Finance (now Secretary of Finance and Administration) and the head of the department involved. Reeves v. Talbott, 289 Ky. 581 , 159 S.W.2d 51, 1941 Ky. LEXIS 37 ( Ky. 1941 ) (decided under prior law).

Research References and Practice Aids

Cross-References.

Mileage allowance for travel by motor vehicle, KRS 44.060 .

State police, expense accounts of, KRS 16.100 .

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. III, 33 at 936.

45.110. Representative of department of finance to serve appropriations committees. [Repealed.]

Compiler’s Notes.

This section (1992b-16: amend. Acts 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 48.210 .

45.111. Refund of funds illegally received.

Any funds received into the State Treasury which are later determined not to be due to the state may be refunded to the person who paid such funds into the Treasury. The Finance and Administration Cabinet may issue a warrant to disburse the funds upon a request from the budget unit that originally received and deposited the funds. The request for refund must be approved by the head of the budget unit or his designated assistant. The Finance and Administration Cabinet may require any documentation deemed necessary.

History. Enact. Acts 1982, ch. 450, § 43, effective July 1, 1983.

NOTES TO DECISIONS

1.Applicability.

When it was held that the legislature violated Ky. Const. § 51 by transferring funds from workers’ compensation accounts to the general fund, KRS 45.111 did not apply in an action to require the governor to restore funds previously transferred because the statute only applied to funds received by the state treasury that were not due, and assessments on workers’ compensation premiums at issue were due. Beshear v. Haydon Bridge Co., 416 S.W.3d 280, 2013 Ky. LEXIS 582 ( Ky. 2013 ).

45.120. Appropriation of preceding year, when continued. [Repealed.]

Compiler’s Notes.

This section (1992b-17: amend. Acts 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983.

45.121. Examination of claims — Preaudit by budget unit — Compromise of claims.

  1. The Finance and Administration Cabinet shall examine all authorizations for payment presented, and if it finds them correct shall file them and issue warrants upon the State Treasurer. The Finance and Administration Cabinet shall not certify any claim to the State Treasurer until it is satisfied that there is in the appropriation to the budget unit against which the claim is chargeable, a sufficient amount to pay the claim. The Finance and Administration Cabinet may rely on the preaudit performed by a budget unit as a basis for issuing a warrant.
  2. The Finance and Administration Cabinet, the Chief Justice, and the Legislative Research Commission with the approval of the Attorney General, may authorize the compromise of any disputed claim by or against their respective branches of government. In the event of a claim against the Commonwealth which cannot be ascribed to a particular branch of government or budget unit thereof, with the approval of the Attorney General, it may be compromised by agreement among them.

History. Enact. Acts 1982, ch. 450, § 44, effective July 1, 1983.

NOTES TO DECISIONS

1.Authorization for Payment.
2.— Certifying Correctness.

To the extent the Department of Finance (now Finance and Administration Cabinet) was authorized to certify the correctness of a claim from an accounting and bookkeeping standpoint, the warrant must have been honored by the Treasurer; however, the specific right to question the validity of a claim on constitutional grounds was not reposed by statute in either the Department of Finance (now Finance and Administration Cabinet) or the State Treasurer but stemmed from the general provisions of both the Constitution and the statutes which fixed a basic public policy with respect to the expenditure of public funds. Raney v. Stovall, 361 S.W.2d 518, 1962 Ky. LEXIS 246 ( Ky. 1962 ) (decided under prior law).

Research References and Practice Aids

Cross-References.

Claims allowed by court, Finance and Administration Cabinet may contest, KRS 44.020 .

Fraudulent, erroneous or illegal fee, bill or claim, Attorney General to recover amount allowed or paid, KRS 15.060 .

45.130. Transfer of appropriations and allotments. [Repealed.]

Compiler’s Notes.

This section (1992b-18, 1992b-23) was repealed by Acts 1948, ch. 185, § 4.

45.131. Investigations of mismanagement of branches of government.

The Finance and Administration Cabinet, the Chief Justice, and the Legislative Research Commission for their respective branches of government shall investigate any alleged mismanagement of any of the affairs of the state by any officer, employee, or governing body responsible within their respective branches of government for the carrying out of any state function or the management of state funds and shall recommend the removal of any unnecessary officer or employee and of any officer or employee who they find has grossly mismanaged any state affairs within their respective branches of government.

History. Enact. Acts 1982, ch. 450, § 45, effective July 1, 1983.

NOTES TO DECISIONS

1.Duty to investigate.

Circuit court erred in finding that the Secretary of the Kentucky Finance and Administration Cabinet did not have the power to issue a subpoena to a consultant; because the Secretary has the duty to investigate mismanagement of public funds, there was no need for the legislature to use words including Ky. Rev. Stat. Ann. ch. 45A within the subpoena power granted. Landrum v. Lassiter, 2018 Ky. App. LEXIS 271 (Ky. Ct. App. Nov. 16, 2018).

2.Subpoena Powers.

Pursuant to Ky. Rev. Stat. Ann. §§ 45.131 and 45.142 , the subpoena powers of the Secretary of the Finance and Administration Cabinet extended to suspected violations of Kentucky’s Model Procurement Code. Lassiter v. Landrum, 610 S.W.3d 242, 2020 Ky. LEXIS 401 ( Ky. 2020 ).

45.140. Revolving trust and agency accounts — Charges for services by agencies. [Repealed.]

Compiler’s Notes.

This section (1992b-19: amend. Acts 1946, ch. 149, § 2; 1948, ch. 235; 1966, ch. 131, § 1; 1968, ch. 119, § 15; 1974, ch. 260, § 3) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.253 .

45.141. Agency fund account for department of agriculture. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1950, ch. 6, § 1) was repealed by Acts 1974, ch. 260, § 10.

45.142. Enforcement of laws — Investigation procedure.

For the purpose of enforcing the provisions of this chapter and those sections of KRS Chapters 41, 45, and 48 relating to the state budget and financial administration, the secretary of the Finance and Administration Cabinet, the Chief Justice, and the Legislative Research Commission, for their respective branches of government, or any officer or employee designated by them, shall have free access during business hours to all books, reports, papers, and accounts in the office or under the care or control of any budget unit of their respective branches of government, and may administer oaths, certify to official acts, issue subpoenas, compel the attendance of witnesses and the production of testimony touching any subject properly under investigation by them, and may compel the production of books, papers, and accounts. If any person fails to comply with the order of, or to obey a subpoena issued by them or their designated agents, or refuses to testify as a witness to any matters regarding which he may be lawfully interrogated, the judge having jurisdiction of the person to whom the order or subpoena was issued may, on their application compel obedience by proceedings for contempt as in the case of disobedience of a subpoena or order issued from such court or a refusal to testify therein, and may adjudge such person guilty of contempt of court and punish him as provided by law in other contempt cases.

History. Enact. Acts 1982, ch. 450, § 46, effective July 1, 1983.

NOTES TO DECISIONS

1.Power to Issue Subpoenas.

Circuit court erred in finding that the Secretary of the Kentucky Finance and Administration Cabinet did not have the power to issue a subpoena to a consultant; because the Secretary has the duty to investigate mismanagement of public funds, there was no need for the legislature to use words including Ky. Rev. Stat. Ann. ch. 45A within the subpoena power granted. Landrum v. Lassiter, 2018 Ky. App. LEXIS 271 (Ky. Ct. App. Nov. 16, 2018).

By the use of the word “and” in the statute, the legislature conferred an additional and separate investigative tool, the power to issue subpoenas, compel the attendance of witnesses and the production of testimony touching any subject properly under investigation by him, and compel the production of books, papers, and accounts, and this power is not limited by time, place, or person. Landrum v. Lassiter, 2018 Ky. App. LEXIS 271 (Ky. Ct. App. Nov. 16, 2018).

Secretary of the Kentucky Finance and Administration Cabinet’s subpoena power under the statute extends investigations to all mismanagement of state funds within the executive branch, including the procurement and award of state contracts and that a subpoena ducus tecum may be properly issued to persons and entities outside of state government; however, the Secretary has no independent power to enforce those subpoenas. Landrum v. Lassiter, 2018 Ky. App. LEXIS 271 (Ky. Ct. App. Nov. 16, 2018).

Pursuant to Ky. Rev. Stat. Ann. §§ 45.131 and 45.142 , the subpoena powers of the Secretary of the Finance and Administration Cabinet extended to suspected violations of Kentucky’s Model Procurement Code. Lassiter v. Landrum, 610 S.W.3d 242, 2020 Ky. LEXIS 401 ( Ky. 2020 ).

After comparing Ky. Rev. Stat. Ann. § 45.990 to Ky. Rev. Stat. Ann. § 45.142 , it was clear that the enforcement provision did not identify the scope of the subpoena power. Lassiter v. Landrum, 610 S.W.3d 242, 2020 Ky. LEXIS 401 ( Ky. 2020 ).

Secretary of the Finance and Administration Cabinet’s subpoena power extended to nongovernment employees as long as the subpoena touched any subject properly under his investigation and was otherwise proper. Lassiter v. Landrum, 610 S.W.3d 242, 2020 Ky. LEXIS 401 ( Ky. 2020 ).

Research References and Practice Aids

Cross-References.

Contempt, punishment for, KRS 432.230 to 432.270 .

Heads of administrative departments and their agents may administer oaths and examine witnesses, KRS 12.120 .

Witnesses, how attendance compelled, KRS 421.110 to 421.140 .

45.149. Audit of budget unit by Auditor of Public Accounts — Contract for audit by certified public accountant.

  1. A budget unit of any branch of government may request that an audit be performed by the Auditor of Public Accounts. Such request shall be in writing and shall include a statement of the scope and nature of the proposed audit.
  2. No budget unit shall enter into any contract with a certified public accountant for an audit unless the Auditor of Public Accounts has declined in writing to perform the audit or has failed to respond within fifteen (15) days of receipt of a written request for an audit. Any contract with a certified public accountant entered into as a result of the Auditor of Public Accounts declining to perform the audit shall specify the following:
    1. The certified public accountant shall forward a copy of the audit report and management letters to the Auditor of Public Accounts and to the Legislative Research Commission; and,
    2. The Auditor of Public Accounts shall have the right to review the certified public accountant’s work papers.

History. Enact. Acts 1982, ch. 450, § 48, effective July 1, 1983; 1998, ch. 120, § 6, effective July 15, 1998.

45.150. Capital outlays, how authorized. [Repealed.]

Compiler’s Notes.

This section (1992b-20, 1992b-21: amend. Acts 1964, ch. 7, § 11) was repealed by Acts 1968, ch. 174, § 3.

45.151. Certain projects are subject to KRS Chapter 56.

All capital construction projects or capital outlays for the improvement of land or the construction, alteration, reconstruction, or major repair of any building or other structure, or sewage disposal or water supply system, or any bridge or road except a road and bridge under the jurisdiction of the Department of Highways, authorized under this chapter shall be subject to the provisions of KRS Chapter 56.

History. Enact. Acts 1968, ch. 174, § 2; Acts 1974, ch. 74, Art. IV, § 20(1).

45.155. Contract between state and city of Frankfort for municipal services to state agencies. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1976, ch. 344, § 1; 1980, ch. 188, § 16, effective July 15, 1980) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.021 .

45.160. Allotment of appropriations — Deviations. [Repealed.]

Compiler’s Notes.

This section (1992b-22, 1992b-23, 1992b-25: amend. Acts 1948, ch. 185, § 1; 1954, ch. 244, § 2; 1962, ch. 281, § 1; 1974, ch. 260, § 4) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.610 to 48.620 .

45.170. Disbursements, how authorized — Vouchers. [Repealed.]

Compiler’s Notes.

This section (1992b-3, 1992b-26 to 1992b-28: amend. Acts 1968, ch. 119, § 16; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.251 .

45.180. Expense accounts of state officers and employees. [Repealed.]

Compiler’s Notes.

This section (359a-1, 359a-4: amend. Acts 1950, ch. 56; 1954, ch. 241, § 1; 1968, ch. 119, § 17; 1974, ch. 74, Art. II, § 9(1); 1976, ch. 125, § 1; 1978, ch. 294, § 1, effective June 17, 1978) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.101 .

45.185. Establishment of air travel credit plan and other credit plans. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1954, ch. 241, § 2(1), effective March 22, 1954; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983.

45.190. Unauthorized obligations — Current inventories of supplies and equipment. [Repealed.]

Compiler’s Notes.

This section (1922b-29 to 1992b-31: amend. Acts 1948, ch. 185, § 2; 1968, ch. 119, § 18; 1974, ch. 74, Art. II, § 9(1); 1982, ch. 226, § 1, effective July 15, 1982; 1982, ch. 240, § 1, effective July 15, 1982) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law see KRS 45.242 , 45.244 , 45.313 .

45.200. Contracts for capital outlay or printing in anticipation of appropriations. [Repealed.]

Compiler’s Notes.

This section (1922b-32: amend. Acts 1948, ch. 185, § 3; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 15, 1983. For present law see KRS 45.011 .

45.210. Statements of indebtedness, how presented; forms. [Repealed.]

Compiler’s Notes.

This section (1992b-33, 1992b-34) was repealed by Acts 1968, ch. 119, § 21.

45.220. Examination of claims — Preaudit by budget unit — Compromise of disputed claims. [Repealed.]

Compiler’s Notes.

This section (1992b-34, 1992b-35: amend. Acts 1968, ch. 119, § 19; 1974, ch. 74, Art. II, § 9(1)) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.121 .

45.229. Appropriations — Lapsing.

  1. No state officer or budget unit shall, after the close of any fiscal year, incur, or vote, order, or approve the incurring of, any obligation or expenditure under any appropriation for that fiscal year, and no expenditure shall be made from or charged to any appropriation for any fiscal year that has expired at the time the obligation of the expenditure was incurred.
  2. The Finance and Administration Cabinet may, for a period of thirty (30) days after the close of any fiscal year, draw warrants against the available balances of appropriations made for that fiscal year, for the payment of expenditures incurred during that year or in fulfillment of contracts properly made during that year, but for no other purpose. Except as provided in KRS 48.705 , after the expiration of thirty (30) days from the beginning of each fiscal year, all balances of appropriations for the prior fiscal year shall lapse to the surplus account of the general fund or road fund unless a branch budget bill provides that the appropriation from which the expenditures shall be paid does not lapse. No further payments shall be made on any claims on account of expenditures of the prior fiscal year.

History. Enact. Acts 1982, ch. 450, § 36, effective July 1, 1983; 1990, ch. 507, § 2, effective July 13, 1990; 1995 (3rd Ex. Sess.), ch. 2, § 2, effective November 3, 1995.

NOTES TO DECISIONS

1.Purpose.

The provision of former law regarding lapsing of appropriations permitting the Department of Finance (now Finance and Administration Cabinet) to draw warrants against available balances of appropriations for three months after the close of any fiscal year for payment incurred or in fulfillment of contracts properly made during the previous year “but for no other purpose” was to permit the clearing of payments of obligations legally and in good faith contracted during the course of the year which had just closed and was not intended to be used to evade the budget law, however worthy the object or purpose might be. Commonwealth ex rel. Meredith v. Frost, 295 Ky. 137 , 172 S.W.2d 905, 1943 Ky. LEXIS 185 ( Ky. 1943 ) (decided under prior law).

Research References and Practice Aids

Cross-References.

Airport development fund not to lapse, KRS 183.772 .

Assessment of public utility companies for expenses of Energy Regulatory Commission and Utility Regulatory Commission, funds remaining unexpended not to lapse, KRS 278.150 .

Unemployment compensation administration fund not to lapse, KRS 341.240 .

Workers’ compensation subsequent injury fund not to lapse, KRS 342.122 .

2020-2022 Budget Reference.

See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, A, 15, (1) at 857.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, B, 1, (2) at 867.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, B, 1, (4) at 867.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, C, 2, (6) at 870.See State/Executive Branch Budget, 2020 Ky. Acts ch. 92, Pt. I, D, 7, (2) at 874.See Transportation Cabinet Budget, 2020 Ky. Acts ch. 93, Pt. I, A, 4, (9) at 951.See Legislative Branch Budget, 2020 Ky. Acts ch. 84, Pt. I at 699.See Judicial Branch Budget, 2020 Ky. Acts ch. 96, Pt. I, A, 1, c, (1) at 1142.See Judicial Branch Budget, 2020 Ky. Acts ch. 96, Pt. III, 5 at 1144.

45.230. Lapsing of appropriations. [Repealed.]

Compiler’s Notes.

This section (1992b-38: amend. Acts 1974, ch. 260, § 5; 1976, ch. 33, § 1) was repealed by Acts 1982, ch. 450, § 79, effective July 1, 1983. For present law, see KRS 45.229 .

45.231. Payment of prior year claims.

  1. Any claim against any agency, department, or budget unit not presented or encumbered for payment within the fiscal year in which the obligation was incurred may, after determination by the secretary of the Finance and Administration Cabinet, be found to be a valid claim against the Commonwealth, and may be authorized for payment out of the appropriation for the prior year claims, provided that the agency, department, or budget unit had an available balance sufficient to pay the obligation at the close of the fiscal year in which the obligation was incurred. All claims authorized to be paid under this section shall be limited to those incurred during the two (2) preceding fiscal years, and the total of such claims paid for any one (1) agency, department, or budget unit shall not exceed the available balance remaining to the credit of such agency, department, or budget unit at the close of the fiscal year in which the obligations were incurred.
  2. Any claim incurred against any revolving, trust or agency fund account of any department or agency and authorized to be paid under subsection (1) of this section shall be charged against the current balance to the credit in such revolving, trust or agency fund account, and not the general expenditure fund.

History. Enact. Acts 1950, ch. 104; 1954, ch. 244, § 3, effective July 1, 1954; 1982, ch. 240, § 2, effective July 15, 1982.

Opinions of Attorney General.

The lapsing of the unexpended balance of appropriations of the Department of Education, existing at the close of the fiscal years in question, will not defeat a valid claim under this section, but in fact provides a fund from which said claims may be satisfied. OAG 64-535 .

The payment of so-called prior year claims is limited to those incurred in the fiscal year preceding the then present fiscal year, and which claims were submitted for payment during the then present fiscal year. OAG 64-535 .

An expenditure for back wages under KRS 18.270 (now see KRS 18A.095 ) from allotted funds (100 account) under this section for the current year would not be authorized unless the dismissal time extended over into the present fiscal year. OAG 71-118 .

The payment of the so-called prior year claims is limited to those incurred in the fiscal year immediately preceding the then present fiscal year, and which claims were submitted for payment during the then present fiscal year. OAG 71-118 .

Where the Personnel Board ordered the payment of back salary to two dismissed employes, this section could be applied. OAG 71-118 .

Where a circuit judge has required the presence of more than one deputy sheriff in the courtroom, any old claims for payment of the fees provided for in KRS 64.090 except for prior year claims under this section cannot be honored in the absence of specific legislative action authorizing such payment. OAG 75-520 .

45.235. Social security appropriations not to lapse at end of first fiscal year of biennium. [Repealed.]

Compiler’s Notes.

This section (Enact. Acts 1948, ch. 236, §§ 1 to 3; 1974, ch. 74, Art. VI, § 107(27)) formerly compiled as KRS 200.045 , 205.045 , and 207.085 , was repealed by Acts 1982, ch. 393, § 51, effective July 15, 1982.

45.236. Child welfare appropriations not to lapse.

Notwithstanding the provisions of KRS 45.229 and notwithstanding any other provision of the Kentucky Revised Statutes, any unexpended or unencumbered balance of any Social Security appropriation, made available for expenditure by the Cabinet for Health and Family Services in the administration of its child welfare functions for the first fiscal year of each biennium, remaining at the end of that fiscal year, shall be carried forward and be available for expenditure at any time during the ensuing fiscal year within the biennium and no portion shall lapse to the general expenditure fund.

History. Enact. Acts 1950, ch. 125, § 9; 1970, ch. 92, § 15; 1974, ch. 74, Art. VI, § 107(1); 1984, ch. 111, § 38, effective July 13, 1984; 1998, ch. 426, § 84, effective July 15, 1998; 2005, ch. 99, § 105, effective June 20, 2005.

Collection of Debts Owed the Commonwealth

45.237. Definitions for KRS 45.237 to 45.239 — Establishment of internal controls and preaudit procedures for state agencies — Collection of improper payments — Referral of certified debts by agency or local government to Department of Revenue — Information to be provided to State Treasurer.

  1. As used in KRS 45.237 to 45.239 :
    1. “Agency” means an organizational unit or administrative body in the executive branch of state government as defined in KRS 12.010 ;
    2. “Cabinet” means the Finance and Administration Cabinet;
    3. “Court of Justice” means the Administrative Office of the Courts, all courts, and all clerks of the courts;
    4. “Debt” means:
      1. For agencies, a sum certain which has been certified as due and owing;
      2. For local governments, a sum certain which has been certified as due and owing, including but not limited to any delinquent taxes or fees other than delinquent real and personal property taxes; and
      3. For the Court of Justice, a legal debt, including any fine, fee, court costs, or restitution due the Commonwealth, which have been imposed by a final sentence of a trial court of the Commonwealth and for which the time permitted for payment pursuant to KRS 534.020 has expired;
    5. “Department” means the Department of Revenue;
    6. “Improper payment” means a payment made to a vendor, provider, or recipient due to error, fraud, or abuse; and
    7. “Local government” means any city, county, urban-county government, consolidated local government, charter county government, or unified local government of the Commonwealth.
  2. The cabinet shall develop for the executive branch of state government a system of internal controls and preaudit policies and procedures applicable to disbursement transactions for the purpose of prevention and detection of errors or fraud and abuse prior to the issuance of a check or warrant. The initial policies and procedures shall focus first on programs or activities that expend the most federal and general fund dollars. The cabinet shall develop preaudit procedures that meet the unique needs of each agency.
  3. In establishing these systems of internal control and preaudit policies and procedures, the cabinet shall:
    1. Consult with each agency within the executive branch to ascertain its unique fraud risks;
    2. Establish policies and procedures for agency-level oversight of fraud risks, including risk assessment, risk tolerance, and management policies, and fraud- prevention processing controls;
    3. Establish systems and procedures for detecting both unintentional errors and fraudulent misrepresentations that may have occurred in vendor invoices submitted for payment, applications submitted for benefits, claims for refunds of amounts previously paid or withheld, and other disbursements;
    4. Establish systems and procedures for preventing and detecting unintentional errors and the fraudulent disbursement of funds by state government employees in the processing, approving, and paying of invoices, refunds, vouchers, benefit payments, and other disbursements; and
    5. Consult with the state Auditor of Public Accounts, the Commonwealth Office of Technology, the American Institute of Certified Public Accountants, the Association of Certified Fraud Examiners, law enforcement agencies, or any other entity with knowledge and expertise in the detection and prevention of fraud.
  4. Each agency shall diligently attempt to collect amounts paid to a vendor, provider, or recipient due to error, fraud, or abuse for sixty (60) days after the improper payment is discovered. If the improper payment has not been recovered after sixty (60) days, the agency shall certify the improper payment as a debt of the agency and shall refer all certified debts to the department.
  5. A local government may, after making reasonable efforts to collect its debts, by ordinance, resolution, or otherwise pursuant to law, certify its debts that have been due and owing for more than ninety (90) days to the department for collection. The department may, by administrative regulation promulgated in accordance with KRS Chapter 13A, prescribe the form and format of, and the information required in, referrals by a local government, which may be required to be made electronically.
  6. Any funds recovered by an agency within the sixty (60) day collection period allowed under subsection (4) of this section and prior to referral to the department shall be allocated to the fund from which the improper payment was expended.
  7. Each agency shall submit annual summaries of debts due to error, fraud, or abuse, improper payments discovered, and certified debts referred to the department to the Legislative Research Commission. These summaries shall include but not be limited to:
    1. Debts owed the Commonwealth that have been identified by the agency, in accordance with the preaudit procedures established under this section, as those resulting from error, fraud, or abuse, of either the payee or the state agency;
    2. The aggregate amount of money collected by the agency on those debts during the sixty (60) day period allowed under subsection (4) of this section; and
    3. The aggregate amount of certified debts that the agency referred to the department.
  8. Each agency shall provide information about each debt due to error, fraud, or abuse that is certified under this section to the State Treasurer for the Treasurer’s action under KRS 44.030(1).
  9. Each local government shall, where feasible, provide information about each debt that is certified pursuant to this section to the State Treasurer for the Treasurer’s action under KRS 44.030(1).

HISTORY: Enact. Acts 2004, ch. 192, § 1, effective April 21, 2004; 2005, ch. 85, § 61, effective June 20, 2005; 2013, ch. 88, § 3, effective June 25, 2013; 2017 ch. 158, § 7, effective June 29, 2017.

45.238. Powers and duties of Department of Revenue to collect referred debts — Cost-ineffective debts — Treatment of collected debts — Annual report.

  1. Debts that are certified by an agency or by a local government as provided in KRS 45.237 shall be referred to the department for collection. The d