02RS HB314


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HB 314/LM (BR 312) - C. Hoffman, J. Jenkins, J. Adams, A. Arnold, L. Belcher, S. Brinkman, L. Clark, R. Crimm, G. Graham, J. Gray, T. McKee, D. Pasley, J. Richards, W. Scott, R. Thomas

     AN ACT relating to the coordination of local government finance.
     Create new sections of KRS Chapter 65 relating to the coordination of local government finance; include definitions; state purpose to include creation of process to allow county and city to resolve conflicts arising from the levy and collection of occupational license fees and insurance premium taxes, encourage the sharing of revenues from such sources based on service responsibility and costs, encourage efficient and economical collection and administration of such fees and taxes, and recognize that city and county residents should pay their fair share of the cost of services they receive; state intent to be supplemental to other statutory means of resolving conflicts, does not eliminate other tax authorizations and requirements; does not interfere with prior cooperative agreements; does not apply in counties containing cities of the first class; urban-counties or consolidated local governments; does not preclude other revenue sharing procedures; provide for the initiation of the process by fiscal court resolution, or resolutions enacted by a number of cities as prescribed, and require the Department for Local Government to notify the county of the initiation of the process by cities within 10 days of receipt of resolutions; prohibit the creation or the increase in the existing rate of any occupational license fee or insurance premium tax upon initiation of the tax base coordination process, and prohibit any new crediting of taxes until a tax base coordination has been adopted; create a 90 day period in which the prescribed number of cities or the county must act or the proposal becomes void, and prohibit the re-initiation of the issue within the county for 1 year if the 90 day period expires without the adoption of an agreement; require the county and its cities to engage in a joint deliberative process to produce an agreement upon initiation of the process, and require an agreement to be developed by a joint committee as prescribed; establish the contents and function of a tax base coordination agreement, require a minimum effective period of 10 years; require agreements to be enacted by ordinance by county and cities as prescribed prior to becoming effective, permit county to utilize city publication requirements for public notice of such agreements, and require the county judge/executive to notify the designated state agencies within 10 days of final approval; establish minimum review and revision procedures and standards, provide method and time of effectiveness of termination of agreements; exempt counties with populations in excess of 30,000 from 1% cap on occupational license fees if a tax base coordination agreement is in effect, permit agreements to supersede statutory crediting requirements as required, and permit a city to annex urbanized area as prescribed while agreement is in effect; require mediation coordinated by the Department for Local Government if an agreement is not negotiated within 18 months, require the cost of the mediation to be apportioned among the participants based on population; create short title; amend KRS 68.197 and KRS 91A.080 to extend the "moratorium" provisions relating to tax crediting to June 30, 2003; create a new section of KRS Chapter 81A to permit annexation of "urbanized" areas by cities adopting a tax base coordination agreement; require provision of a basic level of urban services within an annexed area within 1 year of annexation; require 75% of resident voters or owners of property proposed to be annexed to petition within 60 days of their opposition in order for a public vote to be taken on the annexation proposal at the next regular election, provide for the certification of the petition and wording of the ballot question; require 75% or more of those persons voting to defeat such an annexation proposal; permit annexation without public referendum if no petition is received within 60 days of the enactment of the "intent to annex" ordinance; require the inclusion in the annexation ordinance of a map showing the zoning of an annexed area if the city has established the zoning for the area prior to the completion of the annexation.


     HCS/LM - Exempt license taxes and fees imposed and collected by a county prior to January 1, 2000 to finance a public service program; permits the application of tax credits in communities which were previously prohibited from taking the credits due to pending litigation; and add requirement that agreements must preserve a jurisdiction's right to levy its own fees.

     HFA (1, G. Lindsay) - Provide that any mediator selected to mediate a tax base coordination agreement must be agreed to by the parties; that the mediator has 90 days to issue a final decision; that the decision of the mediator is not binding; and that if no agreement is reached, any proposed agreement is void.

     HFA (2, R. Adkins) - Remove provisions which would authorize cities to annex urbanized areas.

     HFA (3, J. Hoover) - Delete language which would remove the 1% cap on county occupational license fees on counties with populations over 30,000.

     SCS/FN/LM - Retain the original provisions and provide that the provisions of this Act shall not apply to counties having a population of 30,000 or less; provide that the provisions of Section 12 and 13 expire on June 30, 2002 in counties containing a city of the first class, urban counties, charter counties, consolidated local governments, and counties with a population of less than 30,000 and shall expire for all other counties on June 30, 2003.

     CCR - Cannot agree.

     FCCR - Delete the original provisions of SB 314 SCS and add language to create a new section of KRS Chapter 68 to allow a county, which prior to attaining 30,000 population levied an occupational license fee, to not be required to credit occupational license fees paid to the city against occupational license fees owed to the county after the county population exceeds 30,000; prohibit the county from eliminating a credit for occupational license fees paid to a city after the county reaches 30,000 if the county voluntarily granted a credit under the terms of an ordinance or agreement prior to the effective date of the Act; require a county to allow a credit against county occupational license fees for occupational license fees paid to the city after the county exceeds 30,000 in population if the county enacts a new occupational license fee or allow a credit up to the amount of any increase in the current fee after the effective date of the Act; require that a county population shall be based on the official decennial census.

     Jan 11-introduced in House
     Jan 14-to Local Government (H)
     Jan 17-posted in committee
     Jan 31-reported favorably, 1st reading, to Calendar with Committee Substitute
     Feb 1-2nd reading, to Rules
     Feb 6-posted for passage in the Regular Orders of the Day for Thursday, February 7, 2002
     Feb 8-3rd reading; Committee Substitute adopted; laid on clerk's desk
     Feb 11-floor amendment (1) filed to Committee Substitute
     Feb 13-floor amendments (2) and (3) filed to Committee Substitute
     Feb 14-taken from clerk's desk; placed in the Orders of the Day Thursday, February 14, 2002; passed 86-8 with Committee Substitute, floor amendments (1) (2) and (3)
     Feb 15-received in Senate
     Feb 19-to Appropriations and Revenue (S)
     Mar 1-reported favorably, 1st reading, to Calendar with Committee Substitute
     Mar 4-2nd reading, to Rules
     Mar 7-posted for passage in the Regular Orders of the Day for Friday, March 8, 2002
     Mar 8-3rd reading, passed 28-4-1 with Committee Substitute
     Mar 11-received in House; posted for passage for concurrence in Senate Committee Substitute
     Mar 12-House refused to concur in Senate Committee Substitute
     Mar 13-received in Senate
     Mar 19-posted for passage for receding from Senate Committee Substitute for Wednesday, March 20, 2002
     Mar 20-Senate refused to recede from Committee Substitute
     Mar 21-Conference Committee appointed in House and Senate
     Mar 22-Conference Committee report filed in House and Senate; Conference Committee report adopted in House and Senate; Free Conference Committee appointed in House and Senate; Free Conference Committee report filed in House and Senate; Free Conference Committee report adopted in Senate; bill passed 34-1
     Mar 25-received in House
     Mar 26-Free Conference Committee report adopted in House; bill passed 85-8
     Mar 27-enrolled, signed by each presiding officer; delivered to Governor
     Apr 2-signed by Governor (Acts ch. 161)

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