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{As Amended by House Committee of the Whole}
As Amended by House Committee
Session of 2025
House Substitute for Substitute for SENATE BILL No.
197
By Committee on Commerce, Labor and Economic Development
3-19
AN ACT concerning economic development; relating to port authorities;
providing that a port authority may be authorized by enactment of a bill
and authorizing the establishment of a port authority by the unified
government of Wyandotte county and Kansas City, Kansas; relating to
the STAR bonds financing act; relating to STAR bond project district
requirements; authorizing redevelopment of certain mall facilities as
eligible STAR bond projects; authorizing the secretary of commerce to
approve vertical construction within certain STAR bond project
districts; authorizing STAR bond projects in certain counties located in
certain metropolitan statistical areas as rural redevelopment projects;
setting certain visitor origin requirements and requiring certain
enforcement by the secretary against developers that fail to meet such
requirements; requiring the secretary to make certain information
concerning STAR bond projects publicly available on the website of
the department of commerce; prohibiting state general fund moneys
from being pledged for the repayment of any special obligation bond
issued by a city or county to finance a STAR bond project; prohibiting
a city or county from using eminent domain to acquire real property for
a STAR bond project; requiring the secretary to add to the
secretary's annual report information regarding business
movement into and out of STAR bond districts and local sales tax
revenues lost as the result of such movement; extending the
expiration date of the STAR bonds financing act to July 1, 2031;
amending K.S.A. 12-17,160, 12-17,166, 12-17,172 , and 12-17,179 and
12-3402 and K.S.A. 2024 2025 Supp. 12-17,162, 12-17,164 and 12-
17,169 and repealing the existing sections.
Be it enacted by the Legislature of the State of Kansas:
New Section 1. In accordance with the provisions of K.S.A. 12-
3402, and amendments thereto, the legislature approves the creation of a
port authority by the governing body of the unified government of
Wyandotte county and Kansas City, Kansas, with all the powers, duties,
limitations and obligations provided for in article 34 of chapter 12 of the
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Kansas Statutes Annotated, and amendments thereto, as the governing
body of the unified government of Wyandotte county and Kansas City,
Kansas, may create by appropriate resolutions or ordinances.
New Sec. 2. (a) The governing body of a city or county may establish
one or more STAR bond projects for the purpose of the redevelopment of a
mall facility in accordance with the provisions of the STAR bonds
financing act, K.S.A. 12-17,160 et seq., and amendments thereto. The
secretary of commerce shall review the STAR bond project plan and
determine whether to approve such plan in accordance with this section
and the STAR bonds financing act. A mall STAR bond project may be
located in a newly created mall STAR bond project district or in an
existing STAR bond project district.
(b) Any mall STAR bond project approved by a city or county and
the secretary in accordance with the STAR bonds financing act shall be
eligible for financing by special obligation bonds payable from revenues
described by K.S.A. 12-17,169(a)(1), and amendments thereto, which
revenues may include 100% of the tax increment revenue received. Any
special obligation bonds issued to finance a mall STAR bond project shall
be subject to the provisions of the STAR bonds financing act. In the event
that the city or county shall default in the payment of any STAR bonds
payable from revenues described in K.S.A. 12-17,169(a)(1), and
amendments thereto, no public funds shall be used to pay the holders
thereof except as specifically authorized by the STAR bonds financing act.
Any bonds issued may pay for any or all amounts of the overall project
costs and shall not be limited to payment of only a certain percentage of
total project costs for such mall STAR bond project.
(c) For purposes of the STAR bonds financing act:
(1) "Large metropolitan mall STAR bond project" means a project
that the secretary finds meets the following criteria:
(A) The project has the primary purpose of sports or entertainment
tourism that will draw at least 30% of visitors from a distance of at least
100 miles and at least 20% of its visitors from outside this state. The
secretary shall verify and track visitors and disclose the method of visitor
tracking and the visitor tracking data in the secretary's annual report to the
legislature;
(B) the project is located in an area of a city or community
experiencing economic decline. The secretary shall determine economic
decline by the analysis of at least two measurable indicators over the most
recent 10-year period for which data is available, including, but not limited
to, a decline in real gross domestic product, decline in average household
real income, decreased employment or reductions in industrial production
or retail sales;
(C) the project has a minimum of $50,000,000 in capital investment
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and $50,000,000 in projected gross annual sales; and
(D) no previous application for a mall redevelopment project within
the same county has been approved by the secretary.
(2) "Mall" means an enclosed area comprised of multiple interior-
facing businesses and stores primarily devoted to the in-person retail sale
of goods and services and the parking, green space and arterial roads
contiguous thereto.
(3) "Mall facility" means an area containing a mall that is located
within the state of Kansas.
(4) "Mall STAR bond project" means an approved large metropolitan
mall STAR bond project or rural mall STAR bond project to implement
one or more project plans for the redevelopment of a mall STAR bond
project district that contains a mall in which 50% or more of the total
leasable area for businesses to operate in the mall is unoccupied.
(5) "Mall STAR bond project district" means the specific area
declared to be an eligible area as determined by the secretary that will
include a mall STAR bond project.
(6) "Rural mall STAR bond project" means a project that the
secretary finds meets the following criteria:
(A) The project is within a metropolitan area with a population of
50,000 through 75,000 or outside a metropolitan area with a population of
at least 50,000;
(B) the project will draw at least 20% of total visitors from a distance
of at least 100 miles;
(C) the project is located in an area of a city or community
experiencing economic decline as determined by the secretary using the
measures and analysis as provided by paragraph (1)(B);
(D) no previous application for a mall redevelopment project within
the same county has been approved by the secretary; and
(E) the project application is received by the secretary on or before
December 31, 2026.
(d) This section shall be a part of and supplemental to the STAR
bonds financing act.
New Sec. 3. (a) The secretary of commerce may approve vertical
construction of any project within an approved STAR bond project district
in cities with a population under 60,000, if such approval is granted prior
to December 31, 2025.
(b) This section shall be a part of and supplemental to the STAR
bonds financing act.
Sec. 4.Section 1. K.S.A. 12-17,160 is hereby amended to read as
follows: 12-17,160. It is hereby declared to be the purpose of this act to
promote, stimulate and develop the general and economic welfare of the
state of Kansas and its communities and to assist in the development and
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redevelopment of eligible areas within and without a city thereby
promoting the general welfare of the citizens of this state, growth through
tourism by authorizing cities and counties to acquire certain property and
to issue sales tax and revenue (STAR) bonds for the financing of STAR
bond projects as defined in K.S.A. 12-17,162, and amendments thereto. It
is further found and declared that the powers conferred by this act are for a
public purpose and public use for which public money may be expended
and the power of eminent domain may be exercised. The necessity in the
public interest for the provisions of this act is hereby declared as a matter
of legislative determination.
Sec. 5. 2. K.S.A. 2024 {2025} Supp. 12-17,162 is hereby amended to
read as follows: 12-17,162. As used in the STAR bonds financing act,
unless a different meaning clearly appears from the context:
(a) "Auto race track facility" means: (1) An auto race track facility
and facilities directly related and necessary to the operation of an auto race
track facility, including, but not limited to, grandstands, suites and viewing
areas, concessions, souvenir facilities, catering facilities, visitor and retail
centers, signage and temporary hospitality facilities, but excluding (2)
hotels, motels, restaurants and retail facilities, not directly related to or
necessary to the operation of such facility.
(b) "Commence work" means the manifest commencement of actual
operations on the development site, such as, erecting a building,
excavating the ground to lay a foundation or a basement or work of like
description according to an approved plan of construction, with the
intention and purpose to continue work until the project is completed.
(c) "De minimis" means an amount less than 15% of the land area
within a STAR bond project district.
(d) "Developer" means any person, firm, corporation, partnership or
limited liability company other than a city and other than an agency,
political subdivision or instrumentality of the state. "Developer" includes
the names of the owners, partners, officers or principals of the developer
for purposes of inclusion of the name of the developer into any
application, document or report pursuant to this act if such application,
document or report is a public record.
(e) "Economic impact study" means a study to project the financial
benefit of the project to the local, regional and state economies.
(f) "Eligible area" means a historic theater, mall facility as defined in
section 2, and amendments thereto, major tourism area, major motorsports
complex, auto race track facility, river walk canal facility, major multi-
sport athletic complex, major business facility, a major commercial
entertainment and tourism area or a major professional sports complex as
determined by the secretary.
(g) "Feasibility study" means a feasibility study as defined in K.S.A.
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12-17,166(b), and amendments thereto.
(h) "Historic theater" means a building constructed prior to 1940 that
was constructed for the purpose of staging entertainment, including motion
pictures, vaudeville shows or operas, that is operated by a nonprofit
corporation and is designated by the state historic preservation officer as
eligible to be on the Kansas register of historic places or is a member of
the Kansas historic theatre association.
(i) "Historic theater sales tax increment" means the amount of state
and local sales tax revenue imposed pursuant to K.S.A. 12-187 et seq., 79-
3601 et seq. and 79-3701 et seq., and amendments thereto, collected from
taxpayers doing business within the historic theater that is in excess of the
amount of such taxes collected prior to the designation of the building as a
historic theater for purposes of this act.
(j) "Major business facility" means a significant business
headquarters or office building development designed to draw a substantial
number of new visitors to Kansas and that has agreed to provide visitor
tracking data to the secretary as requested by the secretary, including, but
not limited to, residence zip code information, to be provided or held by
the secretary without personally identifiable information. A major business
facility shall meet sales tax increment revenue requirements that shall be
established by the secretary independent of any associated retail businesses
located in the STAR bond project district pursuant to the STAR bond
project plan.
(k) "Major commercial entertainment and tourism area" means an
area that may include, but not be limited to, a major multi-sport athletic
complex.
(l) "Major motorsports complex" means a complex in Shawnee
county that is utilized for the hosting of competitions involving motor
vehicles, including, but not limited to, automobiles, motorcycles or other
self-propelled vehicles other than a motorized bicycle or motorized
wheelchair. Such project may include racetracks, all facilities directly
related and necessary to the operation of a motorsports complex,
including, but not limited to, parking lots, grandstands, suites and viewing
areas, concessions, souvenir facilities, catering facilities, visitor and retail
centers, signage and temporary hospitality facilities, but excluding hotels,
motels, restaurants and retail facilities not directly related to or necessary
to the operation of such facility.
(m) "Major tourism area" means an area for which the secretary has
made a finding the capital improvements costing not less than
$100,000,000 will be built in the state to construct an auto race track
facility.
(n) "Major multi-sport athletic complex" means an athletic complex
that is utilized for the training of athletes, the practice of athletic teams, the
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playing of athletic games or the hosting of events. Such project may
include playing fields, parking lots and other developments including
grandstands, suites and viewing areas, concessions, souvenir facilities,
catering facilities, visitor centers, signage and temporary hospitality
facilities, but excluding hotels, motels, restaurants and retail facilities, not
directly related to or necessary to the operation of such facility.
(o) "Major professional sports complex" means a project, approved or
pursuant to an authorized agreement as provided by K.S.A. 2024 {2025}
Supp. 12-17,181, and amendments thereto, located within this state
including a stadium of not less than 30,000 seats for the purpose of the
holding of national football league or major league baseball athletic
contests and other events and gatherings or a practice or training facility
utilized by a major professional sports franchise and all buildings,
improvements, facilities or attractions located within any STAR bond
project district as defined in subsection (cc)(2).
(p) "Major professional sports franchise" means any corporation,
partnership or other entity that owns a team or franchise that is a member
of the national football league or major league baseball that is located in
any state adjacent to Kansas.
(q) "Market study" means a study to determine the ability of the
project to gain market share locally, regionally and nationally and the
ability of the project to gain sufficient market share to:
(1) Remain profitable past the term of repayment; and
(2) maintain status as a significant factor for travel decisions.
(r) "Market impact study" means a study to measure the impact of the
proposed project on similar businesses in the project's market area.
(s) "Museum facility" means a separate newly-constructed museum
building and facilities directly related and necessary to the operation
thereof, including gift shops and restaurant facilities, but excluding hotels,
motels, restaurants and retail facilities not directly related to or necessary
to the operation of such facility. The museum facility shall be owned by
the state, a city, county, other political subdivision of the state or a non-
profit corporation, shall be managed by the state, a city, county, other
political subdivision of the state or a non-profit corporation and may not
be leased to any developer and shall not be located within any retail or
commercial building.
(t) "Project" means a STAR bond project.
(u) "Project costs" means those costs necessary to implement a STAR
bond project plan, including costs incurred for:
(1) Acquisition of real property within the STAR bond project area;
(2) payment of relocation assistance pursuant to a relocation
assistance plan as provided in K.S.A. 12-17,173, and amendments thereto;
(3) site preparation including utility relocations;
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(4) sanitary and storm sewers and lift stations;
(5) drainage conduits, channels, levees and river walk canal facilities;
(6) street grading, paving, graveling, macadamizing, curbing,
guttering and surfacing;
(7) street light fixtures, connection and facilities;
(8) underground gas, water, heating and electrical services and
connections located within the public right-of-way;
(9) sidewalks and pedestrian underpasses or overpasses;
(10) drives and driveway approaches located within the public right-
of-way;
(11) water mains and extensions;
(12) plazas and arcades;
(13) parking facilities and multilevel parking structures devoted to
parking only;
(14) landscaping and plantings, fountains, shelters, benches,
sculptures, lighting, decorations and similar amenities;
(15) auto race track facility;
(16) major multi-sport athletic complex;
(17) museum facility;
(18) major motorsports complex;
(19) rural redevelopment project, including costs incurred in
connection with the construction or renovation of buildings or other
structures;
(20) major professional sports complex, including all costs necessary
to implement a STAR bond project plan for the development of a major
professional sports complex, including, but not limited to, costs incurred
for construction or renovation of a stadium and other buildings,
improvements, structures, facilities, infrastructure improvements and
utilities or any related expenses to develop and finance such complex;
(21) related expenses to redevelop and finance the project, except that
for a STAR bond project financed with special obligation bonds payable
from the revenues described in K.S.A. 12-17,169(a)(1) or (a)(2)(A) and (a)
(2)(B), and amendments thereto, such expenses shall require prior
approval by the secretary of commerce; and and
(22) mall facility, including:
(A) All costs necessary to implement a project plan for the
redevelopment of a mall STAR bond project district, including costs
incurred for infrastructure and utilities, the acquisition of personal
property related thereto and any other related expenses necessary to
develop and finance such mall facility; and
(B) including costs incurred for the construction or renovation of
interior and exterior structures, parking facilities and multi-level parking
structures if:
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(i) The project is a large metropolitan mall STAR bond project as
defined in section 2 , and amendments thereto, and the project application
is received by the secretary on or before December 31, 2025. Such costs
shall not be permitted for any future expansion of the metropolitan mall
STAR bond project district; or
(ii) the project is a rural mall STAR bond project as defined in section
2 , and amendments thereto, the project includes a sports or entertainment
tourism component or an education tourism component such as a museum
or other educational facility and the deadline for a project application of
December 31, 2026, as provided by section 2 , and amendments thereto,
are met.
(23) except as specified in paragraphs (1) through (21) (22) (21)
above, "project costs" does not include:
(A) Costs incurred in connection with the construction of buildings or
other structures;
(B) fees and commissions paid to developers, real estate agents,
financial advisors or any other consultants who represent the developers or
any other businesses considering locating in or located in a STAR bond
project district;
(C) salaries for local government employees;
(D) moving expenses for employees of the businesses locating within
the STAR bond project district;
(E) property taxes for businesses that locate in the STAR bond project
district;
(F) lobbying costs;
(G) any bond origination fee charged by the city or county;
(H) any personal property as defined in K.S.A. 79-102, and
amendments thereto; and
(I) travel, entertainment and hospitality.
(v) "Projected market area" means any area within the state in which
the project is projected to have a substantial fiscal or market impact upon
businesses in such area.
(w) "River walk canal facilities" means a canal and related water
features which flow through a major commercial entertainment and
tourism area and facilities related or contiguous thereto, including, but not
limited to, pedestrian walkways and promenades, landscaping and parking
facilities.
(x) "Rural redevelopment project" means a project that will enhance
the quality of life in the community and the region and is in:
(1) An area outside of a metropolitan area with a population of more
than 50,000, that is of regional importance , and with capital investment of
at least $3,000,000 and that will enhance the quality of life in the
community and region; or
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(2) a county with a population under 100,000 within the Kansas City
or Wichita metropolitan statistical areas, of regional importance and with
capital investment of at least $3,000,000.
(y) "Sales tax and revenue" are those means revenues that are
available to finance the issuance of special obligation bonds as identified
in K.S.A. 12-17,168, and amendments thereto.
(z) "STAR bond" means a sales tax and revenue bond.
(aa) "STAR bond project" means:
(1) An approved project to implement a project plan for the
development of the established STAR bond project district that:
(A) (i) Has at least a $75,000,000 capital investment and $75,000,000
in projected gross annual sales; or
(ii) for metropolitan areas with a population of between 50,000 and
75,000, has at least a $40,000,000 capital investment and $40,000,000 in
projected gross annual sales, if the project is deemed of high value by the
secretary; or
(B) for areas outside of metropolitan areas with a population of more
than 50,000, the secretary finds the project:
(i) Is an eligible area as defined in subsection (f); and
(ii) would be of regional or statewide importance;
(C) is a major tourism area as defined in subsection (m);
(D) is a major motorsports complex, as defined in subsection (l); or
(E) is a rural redevelopment project as defined in subsection (x); or or
(2) a project approved or pursuant to an authorized agreement as
provided by K.S.A. 2024 {2025} Supp. 12-17,181, and amendments
thereto, to implement one or more project plans for the development of a
major professional sports complex with a combined capital investment of
not less than $1,000,000,000; or
(3) an approved mall STAR bond project as defined in section 2, and
amendments thereto.
(bb) "STAR bond project area" means the geographic area within the
STAR bond project district in which there may be one or more projects.
(cc) "STAR bond project district" means:
(1) The specific area declared to be an eligible area as determined by
the secretary in which the city or county may develop one or more STAR
bond projects. A "STAR bond project district" includes a redevelopment
district, as defined in K.S.A. 12-1770a, and amendments thereto, created
prior to the effective date of this act for the Wichita Waterwalk project in
Wichita, Kansas, provided, the city creating such redevelopment district
submits an application for approval for STAR bond financing to the
secretary on or before July 31, 2007, and receives a final letter of
determination from the secretary approving or disapproving the request for
STAR bond financing on or before November 1, 2007. No STAR bond
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project district shall include real property which has been part of another
STAR bond project district unless such STAR bond project and STAR
bond project district have been approved by the secretary of commerce
pursuant to K.S.A. 12-17,164 and 12-17,165, and amendments thereto,
prior to March 1, 2016. A STAR bond project district in a metropolitan
area with a population of more than 50,000, shall be a contiguous parcel of
real estate and shall be limited to those areas being developed by the
STAR bond project and any area of real property reasonably anticipated to
directly benefit from the redevelopment project; or
(2) the specific area approved or pursuant to an authorized agreement
as provided by K.S.A. 2024 {2025} Supp. 12-17,181, and amendments
thereto, and that is declared to be an eligible area as determined by the
secretary in which the city or county, or the secretary independently or
with the participation of the city or county, as provided by K.S.A. 12-
17,164, and amendments thereto, may develop one or more STAR bond
projects as defined in subsection (aa)(2). Such area may include real
property that is or has been a part of another STAR bond project district,
however, any outstanding STAR bonds issued for such other STAR bond
project district shall have priority for repayment. Any STAR bond project
district as defined pursuant to this paragraph shall not be required to
contain contiguous parcels of real estate or be limited to those areas being
developed pursuant to any such STAR bond project.
(dd) "STAR bond project district plan" means the preliminary plan
that identifies all of the proposed STAR bond project areas and identifies
in a general manner all of the buildings, facilities and improvements in
each that are proposed to be constructed or improved in each STAR bond
project area.
(ee) "STAR bond project plan" means the plan adopted by a city or
county for the development of a STAR bond project or projects in a STAR
bond project district. "STAR bond project plan" includes a plan adopted by
the secretary independently, the secretary with the participation of a city or
county or a city or county as approved by the secretary, as provided by
K.S.A. 12-17,164, and amendments thereto, for the development of a
STAR bond project or projects as defined in subsection (aa)(2) in a STAR
bond project district as defined in subsection (cc)(2) and approved or
pursuant to an authorized agreement as provided by K.S.A. 2024 {2025}
Supp. 12-17,181, and amendments thereto.
(ff) "Secretary" means the secretary of commerce.
(gg) "Substantial change" means, as applicable, a change wherein the
proposed plan or plans differ substantially from the intended purpose for
which the STAR bond project district plan was approved.
(hh) "Tax increment" means:
(1) Except as provided in paragraph (2), that portion of the revenue
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derived from state and local sales, use and transient guest tax imposed
pursuant to K.S.A. 12-187 et seq., 12-1692 et seq., 79-3601 et seq. and 79-
3701 et seq., and amendments thereto, collected from taxpayers doing
business within that portion of a STAR bond project district occupied by a
project that is in excess of the amount of base year revenue. For purposes
of this subsection, the base year shall be the 12-month period immediately
prior to the month in which the STAR bond project district is established.
The department of revenue shall determine base year revenue by reference
to the revenue collected during the base year from taxpayers doing
business within the specific area in which a STAR bond project district is
subsequently established. The base year of a STAR bond project district,
following the addition of area to the STAR bond project district, shall be
the base year for the original area, and with respect to the additional area,
the base year shall be any 12-month period immediately prior to the month
in which additional area is added to the STAR bond project district. For
purposes of this subsection, revenue collected from taxpayers doing
business within a STAR bond project district, or within a specific area in
which a STAR bond project district is subsequently established shall not
include local sales and use tax revenue that is sourced to jurisdictions other
than those in which the project is located. The secretary of revenue and the
secretary of commerce shall certify the appropriate amount of base year
revenue for taxpayers relocating from within the state into a STAR bond
district.
(2) With respect to any STAR bond project district as defined in
subsection (cc)(2), "tax increment" may include all revenue described in
paragraph (1) collected from retail sales from any business within such
STAR bond project district. "Tax increment" shall include all revenue
derived from the sale of alcoholic liquor as defined in K.S.A. 79-41a01,
and amendments thereto, pursuant to K.S.A. 79-4101 and 79-41a02, and
amendments thereto, collected from consumers purchasing alcoholic
liquor within such STAR bond project district that is in excess of the
amount of base year revenue for such taxes. The "tax increment" for any
such STAR bond project district that has been independently established
by the secretary as provided by K.S.A. 12-17,164, and amendments
thereto, shall not include local sales, use or transient guest tax imposed
pursuant to K.S.A. 12-187 et seq. and 12-1692 et seq., and amendments
thereto, unless approved by a participating city or county as provided by
K.S.A. 12-17,164, and amendments thereto. If a STAR bond project
district as defined in subsection (cc)(2) includes real property that is or has
been part of another previously approved STAR bond project district, the
"tax increment" shall also exclude that portion of state and local sales, use
or transient guest tax revenue pledged to repayment of any STAR bonds
issued for a previously approved STAR bond project within such other
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district while such bonds are outstanding. The amount of base year
revenue for any revenue derived from the sale of alcoholic liquor and any
state sales and use taxes shall be set by the secretary in the secretary's sole
discretion upon the establishment of a STAR bond project district as
defined in K.S.A. 12-17,162(cc)(2), and amendments thereto. If local
sales, use or transient guest tax revenue are also pledged by a city or
county, whether such city or county is participating with the secretary, or is
itself establishing such STAR bond project district, as provided by K.S.A.
12-17,164, and amendments thereto, the amount of base year revenue for
such local tax revenues shall be set by the city or county in the city or
county's discretion and approved by the secretary. Base year revenue
determinations by the secretary or by the city or county as approved by the
secretary shall not be required to be based on the procedure provided in
paragraph (1).
(ii) "Taxpayer" means a person, corporation, limited liability
company, S corporation, partnership, registered limited liability
partnership, foundation, association, nonprofit entity, sole proprietorship,
business trust, group or other entity that is subject to the Kansas income
tax act, K.S.A. 79-3201 et seq., and amendments thereto.
Sec. 6. 3. K.S.A. 2024 {2025} Supp. 12-17,164 is hereby amended to
read as follows: 12-17,164. (a) (1) (A) (i) The governing body of a city
may establish one or more STAR bond projects in any area within such
city or wholly outside the boundaries of such city. A STAR bond project
wholly outside the boundaries of such city must be approved by the board
of county commissioners by the passage of a county resolution.
(ii) The governing body of a county may establish one or more STAR
bond projects in any unincorporated area of the county.
(iii) No STAR bond project as defined by K.S.A. 12-17,162(aa)(2),
and amendments thereto, shall be established by a city or county unless
approved pursuant to K.S.A. 2024 {2025} Supp. 12-17,181, and
amendments thereto.
(B) The governing body of a city or county may elect to participate in
a STAR bond project as defined in K.S.A. 12-17,162(aa)(2), and
amendments thereto, established independently by the secretary pursuant
to an agreement authorized by K.S.A. 2024 {2025} Supp. 12-17,181, and
amendments thereto, by pledging local sales, use and transient guest tax
revenues for the repayment of STAR bonds issued by the Kansas
development finance authority pursuant to this section and K.S.A. 12-
17,169, and amendments thereto. If the governing body of the city or
county elects to participate, the governing body of the city or county shall
hold a public hearing and pass an appropriate ordinance or resolution
specifying the city or county's pledge of such local revenues that meet any
requirements of the secretary and the Kansas development finance
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authority. Such ordinance or resolution shall be passed not later than 60
days after the date of approval by the legislative coordinating council of
the agreement pursuant to K.S.A. 2024 {2025} Supp. 12-17,181, and
amendments thereto, or the secretary may proceed without the city or
county's participation to establish the STAR bond project district and
undertake the STAR bond project plan without further public notice or
hearing, as provided by paragraph (2).
(C) The projects shall be eligible for financing by special obligation
bonds payable from revenues described by K.S.A. 12-17,169(a)(1) and, (a)
(2)(A) and (a)(2)(B), and amendments thereto. Upon approval by the
secretary, a STAR bond project as defined in K.S.A. 12-17,162(aa)(2), and
amendments thereto, may be financed by the Kansas development finance
authority as provided by K.S.A. 12-17,169, and amendments thereto.
(2) In lieu of the procedure required for a city or county to establish a
STAR bond project district and a STAR bond project set forth in K.S.A.
12-17,165 and 12-17,166, and amendments thereto, or to finance a project,
the secretary may independently establish a STAR bond project district as
defined in K.S.A. 12-17,162(cc)(2), and amendments thereto, undertake a
STAR bond project as defined in K.S.A. 12-17,162(aa)(2), and
amendments thereto, or finance such a STAR bond project through special
obligation bonds issued by the Kansas development finance authority as
provided by K.S.A. 12-17,169(a)(2)(B), and amendments thereto, with or
without the participation of the city or county. In such case, except as
otherwise provided, in addition to all powers granted to the secretary, the
secretary shall have the powers of a city or county as provided by the
STAR bonds financing act necessary in the secretary's discretion to
establish, undertake or finance the project through the Kansas
development finance authority. The notice, procedural and hearing
requirements of K.S.A. 12-17,165 and 12-17,166, and amendments
thereto, shall not be applicable to the secretary. Such authority shall
include changes to such district as provided by K.S.A. 12-17,171, and
amendments thereto, except that no public hearings shall be required.
Upon the approval of the secretary, the Kansas development finance
authority is authorized to issue special obligation bonds in one or more
series to finance such project. No revenue from local sales, use or transient
guest taxes imposed pursuant to K.S.A. 12-187 et seq. and 12-1692 et seq.,
and amendments thereto, shall be pledged as a source of repayment of
such special obligation bonds unless approved by the city or county as
provided by paragraph (1)(B). Such bonds shall not be a general obligation
of the state. Any such bonds and interest thereon shall be an obligation
only of the Kansas development finance authority and shall not constitute
a debt of the state of Kansas within the meaning of section 6 or 7 of article
11 of the constitution of the state of Kansas and shall not pledge the full
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faith and credit or the taxing power of the state of Kansas. Such bonds
shall be payable, both as to principal and interest, solely from the revenue
sources as provided by K.S.A. 12-17,169(a)(2)(B), and amendments
thereto.
(3) The secretary's authority to approve STAR bond projects as
defined in K.S.A. 12-17,162(aa)(2), and amendments thereto, including
any such project established by a city or county or established
independently by the secretary with or without the participation of the city
or county shall be subject to K.S.A. 2024 {2025} Supp. 12-17,181, and
amendments thereto.
(b) (1) Each STAR bond project shall first be approved by the
secretary, if the secretary determines that the proposed project or complex
sufficiently promotes, stimulates and develops the general and economic
welfare of the state as described in K.S.A. 12-17,160, and amendments
thereto. Except as provided in paragraph (2), the secretary, upon approving
the project, may approve such financing in an amount not to exceed 50%
of the total costs including all project costs and any other costs related to
the project. The proceeds of such STAR bond financing may only be used
to pay for incurred project costs.
(2) For a STAR bond project as defined in K.S.A 12-17,162(aa)(2),
and amendments thereto, the secretary may approve such financing issued
by the city or county or by the Kansas development finance authority, as
applicable, in an amount not to exceed 70% of the total costs including all
project costs and any other costs related to the project.
(c) For a city proposing to finance a major motorsports complex
pursuant to K.S.A. 12-17,169(a)(1)(C) or (a)(1)(E), and amendments
thereto, the secretary, upon approving the project, may approve such
financing in an amount not to exceed 50% of the STAR bond project costs.
(d) The secretary may approve a STAR bond project located in a
STAR bond project district established by a city prior to May 1, 2003.
(e) (1) Except as provided in paragraph (2), a project shall not be
granted to any business that proposes to relocate its business from another
area of the state into such city or county, for the purpose of consideration
for a STAR bond project provided by K.S.A. 12-17,160 et seq., and
amendments thereto.
(2) The provisions of paragraph (1) shall not apply to a STAR bond
project as defined in K.S.A. 12-17,162(aa)(2), and amendments thereto.
(f) A project shall not be approved by the secretary if the market
study required by K.S.A. 12-17,166, and amendments thereto, indicates a
substantial negative impact upon businesses in the project or complex
market area or the granting of such project or complex would cause a
default in the payment of any outstanding special obligation bond payable
from revenues authorized pursuant to K.S.A. 12-17,169(a)(1), and
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amendments thereto.
(g) (1) Except as provided in paragraph (2), the maximum maturity of
special obligation bonds payable primarily from revenues described by
K.S.A. 12-17,169(a)(1), and amendments thereto, to finance STAR bond
projects pursuant to this section shall not exceed 20 years.
(2) Special obligation bonds issued by a city or county or, if
applicable, by the Kansas development finance authority to finance a
STAR bond project as defined in K.S.A. 12-17,162(aa)(2), and
amendments thereto, shall not exceed 30 years.
(h) The secretary shall not approve any application for STAR bond
project financing which is submitted by a city or county more than one
year after the STAR bond project district in which the STAR bond project
is located has been established.
(i) For the purpose of recovering the costs of the secretary and the
department arising from fulfilling administrative, review, approval,
oversight and other responsibilities under the STAR bonds financing act
and from providing assistance to cities, counties and private businesses in
relation to STAR bond projects, the secretary may assess an administrative
fee of up to 1%, not to exceed $200,000, of the amount of the special
obligation bonds payable from revenues described by K.S.A. 12-17,169(a)
(1) or (a)(2), and amendments thereto, issued or reissued for STAR bond
projects. The secretary may also recover any actual costs incurred by the
secretary in excess of the fee. The fee, and any actual costs incurred by the
secretary in excess of the fee, shall be paid to the secretary from the
proceeds of such bonds. All such moneys received by the secretary shall be
remitted to the state treasurer in accordance with the provisions of K.S.A.
75-4215, and amendments thereto. Upon receipt of each such remittance,
the state treasurer shall deposit the entire amount in the state treasury to
the credit of the STAR bond administrative fee fund, which is hereby
created in the state treasury. All expenditures from the STAR bond
administrative fee fund shall be made in accordance with appropriation
acts upon warrants of the director of accounts and reports issued pursuant
to vouchers approved by the secretary or a person or persons designated by
the secretary.
(j) (1) Prior to approval by the secretary of any STAR bond project,
notification of such project and the pending approval by the secretary
shall be provided to the chairperson of the state finance council. Upon
request by the chairperson of the state finance council, the secretary shall
provide any nonconfidential information regarding the project, including,
but not limited to, the project plan, market plan and feasibility study, to the
state finance council for distribution to the members.
(2) The chairperson of the state finance council may call a meeting to
address the project and shall provide notice to the secretary of such
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meeting. Upon request by the state finance council, the secretary or the
secretary's designee shall appear before the council and provide testimony
regarding the project. The state finance council may hear such testimony
or any portion thereof pertaining to the project in an executive session,
and such testimony or portion thereof pertaining to the project shall be
considered an exception to the requirements of the open meetings act
pursuant to K.S.A. 75-4319(b)(4), and amendments thereto, and closed to
the public. All information relating to the project provided or disseminated
to the state finance council for purposes of or during the executive session
shall not be a public record and shall not be subject to the Kansas open
records act, K.S.A. 45-215 et seq., and amendments thereto, except as
provided by this paragraph. The provisions of this exception to the Kansas
open records act shall expire on July 1, 2030, unless the legislature
reviews and reenacts this provision pursuant to K.S.A. 45-229, and
amendments thereto. Upon approval by the secretary, disapproval by the
state finance council or the secretary or abandonment of the project, the
confidential information, if any, provided to the state finance council for
the purpose of or at such executive session shall be provided to the public.
The state finance council may disapprove the project by majority vote
taken in open session, acting on this matter, which is hereby characterized
as a matter of legislative delegation and subject to the guidelines
prescribed in K.S.A. 75-3711c(c), and amendments thereto, and such
disapproval also may be given while the legislature is in session. If the
state finance council does not disapprove the project at such meeting or
the chairperson of the state finance council does not call a meeting that is
held within 30 days of the notice of the project provided to the council by
the secretary pursuant to paragraph (1) the secretary may approve the
project.
(k) (1) Except as provided by paragraph (2), the secretary shall not
approve any project unless the secretary finds that the project is likely to
attract at least 30% of visitors from a distance of at least 100 miles and
20% of visitors from outside the state. The secretary shall track
compliance with this requirement as provided by K.S.A. 12-17,166, and
amendments thereto, and provide the method of visitor origin tracking and
determination of such compliance and the visitor origin data in the
secretary's report to the legislature. Visitor tracking data shall be collected
by the secretary in the aggregate without personal identification
information.
(2) The secretary shall not approve a rural development project, as
defined in K.S.A. 12-17,162, and amendments thereto , or a rural mall
project, as defined in section 2, and amendments thereto, unless the
secretary finds that such project is likely to attract at least 20% of visitors
from a distance of at least 100 miles.
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(3) The secretary shall include in the secretary's annual report to the
legislature information on compliance with the visitation requirements of
this subsection by projects to which such requirements apply.
(l) For projects approved on and after July 1, 2025, the secretary
shall enforce compliance by developers with the project visitor origin
requirements of subsection (k) as follows. Beginning with the third
calendar year following the year that the STAR bond project district was
established, the secretary shall review visitor origin data collected by the
secretary and determine compliance on an annual basis at the end of each
year. If the secretary determines that the STAR bond project has met such
visitor origin requirements for any year following the commencement of
compliance enforcement for such project, the secretary shall cease
compliance enforcement pursuant to this subsection. If the secretary
determines that the STAR bond project has not met such visitor origin
requirements, the developer or developers shall be prohibited from
participating in any other STAR bond project approved by the secretary
subsequent to such determination until the secretary finds upon annual
review of a succeeding year that such requirements have been met and
ceases compliance enforcement. The secretary shall report visitor origin
requirement compliance by developers as required by this subsection in
the secretary's annual report to the legislature.
Sec. 7. 4. K.S.A. 12-17,166 is hereby amended to read as follows: 12-
17,166. (a) One or more projects may be undertaken by a city or county
within an established STAR bond project district upon submission of the
project plan to the secretary of commerce and approval by the secretary as
provided by K.S.A. 12-17,164, and amendments thereto. Any city or
county proposing to undertake a STAR bond project shall prepare a STAR
bond project plan in consultation with the planning commission of the city,
and in consultation with the planning commission of the county, if any, if
such project is located wholly outside the boundaries of the city. Any such
project plan may be implemented in separate development stages. {As
provided by subsection (o), any new STAR bond project and issuance
of new or additional STAR bonds within an existing STAR bond
project district by a city or county or the Kansas development finance
authority after bonds issued for the original project for such existing
STAR bond project district have been paid in full, shall, in addition to
any other requirements pursuant to the STAR bonds financing act,
meet the requirements of subsection (o). }
(b) Any city or county proposing to undertake a STAR bond project
within a STAR bond project district established pursuant to K.S.A. 12-
17,165, and amendments thereto, shall prepare a feasibility study to be
conducted by one or more consultants selected and approved by the
secretary, and the costs shall be paid by the developer or the city or county.
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The secretary shall have control and oversight authority over the scope,
conduct and methodology of the study. The secretary may establish a list
of preapproved consultants and approved study parameters and methods.
The feasibility study shall contain the following:
(1) Whether a STAR bond project's revenue and tax increment
revenue and other available revenues under K.S.A. 12-17,169, and
amendments thereto, are expected to exceed or be sufficient to pay for the
project costs;
(2) the effect, if any, a STAR bond project will have on any
outstanding special obligation bonds payable from the revenues described
in K.S.A. 12-17,169, and amendments thereto;
(3) a statement of how the jobs and taxes obtained from the STAR
bond project will contribute significantly to the economic development of
the state and region;
(4) visitation expectations and a plan describing how the number of
visitors to the STAR bond project district will be tracked and reported to
the secretary on an annual a quarterly basis. Such plan shall include, but
not be limited to, obtaining and reporting visitor residence zip code data to
the secretary. All businesses located in the STAR bond district shall
provide visitor residence data requested by the secretary. Any such data
shall be provided in an aggregate manner without personally identifiable
information;
(5) the unique quality of the project;
(6) economic impact study, including the anticipated effect of the
project on the regional and statewide economies;
(7) market study;
(8) market impact study;
(9) integration and collaboration with other resources or businesses;
(10) the quality of service and experience provided, as measured
against national consumer standards for the specific target market;
(11) project accountability, measured according to best industry
practices;
(12) the expected return on state and local investment that the project
is anticipated to produce;
(13) a net return on investment analysis;
(14) a statement concerning whether a portion of the local sales and
use taxes are pledged to other uses and are unavailable as revenue for the
STAR bond project. If a portion of local sales and use taxes is so
committed, the applicant shall describe the following:
(A) The percentage of city and county sales and use taxes collected
that are so committed; and
(B) the date or dates on which the city and county sales and use taxes
pledged to other uses can be pledged for repayment of bonds;
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(15) an anticipated principal and interest payment schedule on the
bond issue;
(16) a summary of community involvement, participation and support
for the STAR bond project; and
(17) a full disclosure and description of all state, federal and local tax
incentives that apply or, pursuant to the project plan, are anticipated to
apply within the STAR bond district or that apply to any business located
in or, pursuant to the project plan, that will locate in the district.
The failure to include all information enumerated in this subsection in
the feasibility study for a STAR bond project shall not affect the validity of
bonds issued pursuant to this act.
(c) If the city or county determines the project is feasible, the project
plan shall include:
(1) A summary of the feasibility study done as defined in subsection
(b);
(2) a reference to the district plan established under K.S.A. 12-
17,165, and amendments thereto, that identifies the project area that is set
forth in the project plan that is being considered;
(3) a description and map of the project area to be redeveloped;
(4) the relocation assistance plan as described in K.S.A. 12-17,172,
and amendments thereto;
(5) a detailed description of the buildings and facilities proposed to be
constructed or improved in such area;
(6) the names of the owners, partners, officers or principals of any
developer of the project and of any associated business partner of any
developer of the project that is involved in the STAR bond project; and
(7) any other information the governing body of the city or county
deems necessary to advise the public of the intent of the project plan.
(d) A copy of the STAR bond project plan prepared by a city shall be
delivered to the board of county commissioners of the county and the
board of education of any school district levying taxes on property within
the STAR bond project area. A copy of the STAR bond project plan
prepared by a county shall be delivered to the board of education of any
school district levying taxes on property within the STAR bond project
area.
(e) Upon a finding by the planning commission that the STAR bond
project plan is consistent with the intent of the comprehensive plan for the
development of the city, and a finding by the planning commission of the
county, if any, with respect to a STAR bond project located wholly outside
the boundaries of the city, that the STAR bond project plan is consistent
with the intent of the comprehensive plan for the development of the
county, the governing body of the city or county shall adopt a resolution
stating that the city or county is considering the adoption of the STAR
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bond project plan. Such resolution shall:
(1) Give notice that a public hearing will be held to consider the
adoption of the STAR bond project plan and fix the date, hour and place of
such public hearing. In addition to any other notice, such notice shall be
conspicuously provided at a prominent location on the first page of the
website of the county or city, if the county or city has a website;
(2) describe the boundaries of the STAR bond project district within
which the STAR bond project will be located and the date of establishment
of such district;
(3) describe the boundaries of the area proposed to be included within
the STAR bond project area; and
(4) state that the STAR bond project plan, including a summary of the
feasibility study, market study, relocation assistance plan and financial
guarantees of the prospective developer and a description and map of the
area to be redeveloped or developed are available for inspection during
regular office hours in the office of the city clerk or county clerk,
respectively.
(f) (1) The date fixed for the public hearing to consider the adoption
of the STAR bond project plan shall be not less than 30 nor more than 70
days following the date of the adoption of the resolution fixing the date of
the hearing.
(2) A copy of the city or county resolution providing for the public
hearing shall be by certified mail, return receipt requested, sent by the city
to the board of county commissioners of the county and by the city or
county to the board of education of any school district levying taxes on
property within the proposed STAR bond project area. Copies also shall be
sent by certified mail, return receipt requested to each owner and occupant
of land within the proposed STAR bond project area not more than 10 days
following the date of the adoption of the resolution. The resolution shall be
published once in the official city or county newspaper not less than one
week nor more than two weeks preceding the date fixed for the public
hearing. A sketch clearly delineating the area in sufficient detail to advise
the reader of the particular land proposed to be included within the STAR
bond project area shall be published with the resolution.
(3) At the public hearing, a representative of the city or county shall
present the city's or county's proposed STAR bond project plan. The
presentation shall include a discussion of the feasibility study, including a
description of all state, federal and local tax incentives that apply within
the STAR bond district or are anticipated to apply within the district
pursuant to the project plan or to any business located in the district or that
will locate in the district pursuant to the project plan. Following the
presentation of the STAR bond project area, all interested persons shall be
given an opportunity to be heard. The governing body for good cause
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shown may recess such hearing to a time and date certain, which shall be
fixed in the presence of persons in attendance at the hearing.
(g) The public hearing records and feasibility study shall be subject to
the open records act, K.S.A. 45-215, and amendments thereto, and, if the
city or county has a website, shall be placed conspicuously on such
website at the same location or linked to the same location on the first
page of the website as the notice for the hearing.
(h) Upon conclusion of the public hearing, the governing body may
adopt the STAR bond project plan by ordinance or resolution passed upon
a two-thirds vote of the members.
(i) AfterWithin 90 days of the adoption or modification by the city or
county governing body of a STAR bond project plan , and within 90 days
of the selling of the bonds:
(1) The clerk of the city or county shall transmit a copy of the
description of the land within the STAR bond project district, a copy of the
ordinance or resolution adopting the plan and a map or plat indicating the
boundaries of the district to the clerk, appraiser and treasurer of the county
in which the district is located and to the governing bodies of the county
and school district which levy taxes upon any property in the district . Such
documents shall be transmitted following the adoption or modification of
the plan or a revision of the plan on or before January 1 of the year in
which the increment is first allocated to the taxing subdivision.
(j) If the STAR bond project plan is approved, ;
(2) the feasibility study shall be supplemented to include a copy of
the minutes of the governing body meetings of any city or county whose
bonding authority will be utilized in the STAR bond project, evidencing
that a STAR bond project plan has been created, discussed and adopted by
the city or county in a regularly scheduled open public meeting;
(3) the city or county shall notify the residents thereof:
(A) That the STAR bond project plan has been adopted; and
(B) on a continuing basis, the amount of tax increment revenue
received under K.S.A. 12-17,169, and amendments thereto; and
(4) the secretary shall make the following information publicly
available on the department of commerce's website:
(A) The feasibility study;
(B) the STAR bond project plan;
(C) the financial guarantees of the prospective developer;
(D) on a continuing basis, any subsequent modified versions of the
information required by subparagraphs (A) through (C); and
(E) on a continuing basis, visitor data pursuant to subsection (n).
(k)(j) Any substantial changes as defined in K.S.A. 12-17,162, and
amendments thereto, to the STAR bond project plan as adopted shall be
subject to a public hearing following publication of notice thereof at least
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twice in the official city or county newspaper.
(l)(k) Any STAR bond project shall be completed within 20 years
from the date of the approval of the STAR bond project plan. The
maximum maturity on bonds issued to finance projects pursuant to this act
shall not exceed 20 years.
(m)(l) Kansas resident employees shall be given priority
consideration for employment in construction projects located in a STAR
bond project area.
(n)(m) Any developer of a STAR bond project shall commence work
on the project within two years from the date of adoption of the STAR
bond project plan. Should the developer fail to commence work on the
STAR bond project within the two-year period, funding for such project
shall cease and the developer of such project or complex shall have one
year to resubmit the project to the secretary and to appeal to the secretary
for reapproval of such project and the funding for it. Should the project be
reapproved, the two-year period for commencement shall apply.
(n) In collaboration with the STAR bond project developer or
developers and the governing body of a city or county that established the
STAR bond district, the secretary shall collect visitor data using ticket
sales tracking, reliable software or other similar technology that tracks
visitation trends for each STAR bond district that receives state sales tax
revenues until the bond debt service associated with the STAR bond
district has been satisfied but in any event not later than the maturity
period of the bond issuance. The secretary shall compile and include this
data in the report required to be submitted to the house of representatives
committee on commerce, labor and economic development and the senate
committee on commerce pursuant to K.S.A. 12-17,169, and amendments
thereto. Any such data shall be collected in an aggregate manner without
personally identifiable information.
{(o) (1) In the event that STAR bonds or any series of STAR
bonds originally issued for a project, or issuance of bonds to refund or
refinance bonds previously issued for such project, including any such
bonds issued for a project pursuant to a project plan approved prior
to June 30, 2026, or project approved pursuant to an agreement
executed pursuant to K.S.A. 12-17,181, and amendments thereto, have
been paid in full prior to the maximum period allowed pursuant to the
STAR bond financing act, in addition to any other applicable
requirements pursuant to the STAR bonds financing act, the secretary
of commerce shall not approve a new STAR bond project and a city or
county or the Kansas development finance authority shall not issue
new or additional STAR bonds for such new STAR bond project that
are to be financed from sales tax or other revenues from the existing
STAR bond project district or any area that was within such district
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unless:
(A) A new tax increment base for the proposed STAR bond
project district area for the new project is established pursuant to the
STAR bonds financing act; and
(B) the issuance of such new bonds is expressly approved in
writing by both the secretary of commerce and the governing body of
the city or county that created such district.
(2) Nothing in this subsection shall prohibit the completion of
multiple projects or phases of projects that were expressly approved
and financed as part of the initial STAR bond issuance for a district.
Such projects may be completed and the related bonds may remain
outstanding until paid in full.}
Sec. 8. 5. K.S.A. 2024 {2025} Supp. 12-17,169 is hereby amended to
read as follows: 12-17,169. (a) (1) Any city or county shall have the power
to issue special obligation bonds in one or more series to finance the
undertaking of any STAR bond project in accordance with the provisions
of this act. Rural redevelopment projects, as defined in K.S.A. 12-17,162,
and amendments thereto, may also be financed without the issuance of
special obligation bonds up to an amount not to exceed $10,000,000 for
each project. Such special obligation bonds or rural redevelopment project
costs shall be made payable, both as to principal and interest:
(A) From revenues of the city or county derived from or held in
connection with the undertaking and carrying out of any STAR bond
project or projects under this act including historic theater sales tax
increments;
(B) from any private sources, contributions or other financial
assistance from the state or federal government;
(C) from a pledge of 100% of the tax increment revenue received by
the city from any local sales and use taxes, including the city's share of any
county sales tax, which are collected from taxpayers doing business within
that portion of the city's STAR bond project district established pursuant to
K.S.A. 12-17,165, and amendments thereto, occupied by a STAR bond
project, except for amounts committed to other uses by election of voters
or pledged to bond repayment prior to the approval of the STAR bond
project;
(D) at the option of the county in a city STAR bond project district,
from a pledge of all of the tax increment revenues received by the county
from any local sales and use taxes which are collected from taxpayers
doing business within that portion of the city's STAR bond project district
established pursuant to K.S.A. 12-17,165, and amendments thereto, except
for amounts committed to other uses by election of voters or pledged to
bond repayment prior to the approval of a STAR bond project;
(E) in a county STAR bond project district, from a pledge of 100% of
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the tax increment revenue received by the county from any county sales
and use tax, but excluding any portions of such taxes that are allocated to
the cities in such county pursuant to K.S.A. 12-192, and amendments
thereto, which are collected from taxpayers doing business within that
portion of the county's STAR bond project district established pursuant to
K.S.A. 12-17,165, and amendments thereto, occupied by a STAR bond
project;
(F) from a pledge of all or a portion of the tax increment revenue
received from any state sales taxes which are collected from taxpayers
doing business within that portion of the city's or county's STAR bond
project district occupied by a STAR bond project, except that for any
STAR bond project district established and approved by the secretary on or
after January 1, 2017, such tax increment shall not include any sales tax
revenue from retail automobile dealers, and except that for any STAR
bond project district established after July 1, 2021, with existing sales tax
revenue at the time the district was established, such pledge shall not
exceed 90% of the new tax increment revenue that is in excess of the base
existing sales tax revenue received from any state sales taxes;
(G) at the option of the city or county and with approval of the
secretary, from all or a portion of the transient guest tax of such city or
county;
(H) at the option of the city or county and with approval of the
secretary: (i) From a pledge of all or a portion of increased revenue
received by the city or county from franchise fees collected from utilities
and other businesses using public right-of-way within the STAR bond
project district; or (ii) from a pledge of all or a portion of the revenue
received by a city or county from local sales taxes or local transient guest
and local use taxes; or
(I) by any combination of these methods.
The city or county may pledge such revenue to the repayment of such
special obligation bonds prior to, simultaneously with, or subsequent to the
issuance of such special obligation bonds.
As authorized by the secretary, the Kansas development finance
authority shall have the power to issue special obligation bonds in one or
more series to finance the undertaking of a STAR bond project as defined
in K.S.A. 12-17,162(aa)(1) and (3), and amendments thereto, that has
been established by a city or county and approved by the secretary of
commerce pursuant to K.S.A. 12-17,164 and 12-17,167, and amendments
thereto. Such special obligation bonds shall not be general obligations of
the state. Any such bonds and interest thereon shall be an obligation only
of the Kansas development finance authority and shall not constitute a
debt of the state of Kansas within the meaning of section 6 or 7 of article
11 of the constitution of the state of Kansas and shall not pledge the full
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faith and credit or the taxing power of the state of Kansas. Such special
obligation bonds shall be made payable, both as to principal and interest,
solely from the revenues described in subsection (a)(1)(A) through (I).
(2) (A) Special obligation bonds issued by a city or county to finance
a STAR bond project as defined in K.S.A. 12-17,162(aa)(2), and
amendments thereto, that has been approved by the secretary in
accordance with K.S.A. 2024 {2025} Supp. 12-17,181, and amendments
thereto, shall be made payable, both as to principal and interest, from a
pledge of:
(i) Any method or combination of the methods described in
paragraph (1), except that tax increment revenue from sales taxes shall
include sales tax revenue from all retail sales of any business located
within the district and up to 100% of the new state sales tax increment
revenue that is in excess of the base sales tax revenue, as set in the
secretary's discretion, received from any state sales taxes. The city or
county shall have discretion to set the base sales tax revenue for local sales
and use taxes as approved by the secretary;
(ii) tax increment revenue from up to 100% of the taxes imposed on
the sale of alcoholic liquor, as defined in K.S.A. 79-41a01, and
amendments thereto, collected from sales within the district pursuant to
K.S.A. 79-4101 and 79-41a02, and amendments thereto; and
(iii) if approved by the secretary, moneys from the attracting
professional sports to Kansas fund of the department of commerce.
(B) As authorized by the secretary, the Kansas development finance
authority shall have the power to issue special obligation bonds in one or
more series to finance the undertaking of a STAR bond project as defined
in K.S.A. 12-17,162(aa)(2), and amendments thereto, that has been
established by a city or county and approved by the secretary of commerce
pursuant to K.S.A. 2024 {2025} Supp. 12-17,181, and amendments
thereto, or undertaken independently by the secretary pursuant to K.S.A.
12-17,164, and amendments thereto, with or without the participation of
the city or county. Such special obligation bonds shall not be general
obligations of the state. Any such bonds and interest thereon shall be an
obligation only of the Kansas development finance authority and shall not
constitute a debt of the state of Kansas within the meaning of section 6 or
7 of article 11 of the constitution of the state of Kansas and shall not
pledge the full faith and credit or the taxing power of the state of Kansas.
Such special obligation bonds shall be made payable, both as to principal
and interest, solely from:
(i) Tax increment revenue as determined in the secretary's discretion,
from up to 100% of state sales taxes, including state sales tax revenue
from all retail sales of any business located within the district;
(ii) tax increment revenue from up to 100% of the taxes imposed on
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the sale of alcoholic liquor as defined in K.S.A. 79-41a01, and
amendments thereto, from sales within the district pursuant to K.S.A. 79-
4101 and 79-41a02, and amendments thereto;
(iii) if approved by the city or county, revenue from any of the other
methods or combination of methods as provided in subparagraph (A)(i);
and
(iv) if approved by the secretary, moneys from the attracting
professional sports to Kansas fund of the department of commerce.
(C) For purposes of this paragraph, "district" means the STAR bond
project district as defined in K.S.A. 12-17,162(cc)(2), and amendments
thereto. Revenues may be collected pursuant to this paragraph from
noncontiguous parcels of real estate and areas not being developed by a
STAR bond project as defined in subsection (aa)(2) within such STAR
bond project district.
(D) Any revenues that have been pledged to pay one or more STAR
bonds previously issued pursuant to this act shall be used first to satisfy
any remaining obligations of such bonds.
(3) Bonds issued by a city or county under subsection (a)(1) or (a)(2)
(A) shall not be general obligations of the city or the county, nor in any
event shall they give rise to a charge against its general credit or taxing
powers, or be payable out of any funds or properties other than any of
those set forth in subsection (a)(1) or (a)(2)(A) and such bonds shall so
state on their face.
(4) Bonds issued by a city or county under the provisions of
subsection (a)(1) or (a)(2)(A) shall be special obligations of the city or
county and are declared to be negotiable instruments. Such bonds shall be
executed by the mayor and clerk of the city or the chairperson of the board
of county commissioners and the county clerk and sealed with the
corporate seal of the city or county. All details pertaining to the issuance of
such special obligation bonds and terms and conditions thereof shall be
determined by ordinance of the city or by resolution of the county.
All special obligation bonds issued pursuant to this act and all income
or interest therefrom shall be exempt from all state taxes. Such special
obligation bonds shall contain none of the recitals set forth in K.S.A. 10-
112, and amendments thereto. Such special obligation bonds shall,
however, contain the following recitals: (i) The authority under which such
special obligation bonds are issued; (ii) such bonds are in conformity with
the provisions, restrictions and limitations thereof; and (iii) that such
special obligation bonds and the interest thereon are to be paid from the
money and revenue received as provided in subsection (a)(1) and (a)(2).
(5) Any city or county issuing special obligation bonds under the
provisions of this act may refund all or part of such issue pursuant to the
provisions of K.S.A. 10-116a, and amendments thereto. If and as approved
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by the secretary of commerce, the Kansas development finance authority
may refund all or part of any issue of special obligation bonds issued for a
project as defined in K.S.A. 12-17,162(aa)(2) 12-17,162(aa) , and
amendments thereto, by the Kansas development finance authority under
the provisions of this act pursuant to the provisions of K.S.A. 74-8912, and
amendments thereto, and this act.
(6) Under no circumstance shall state general fund moneys be
pledged for the repayment of any special obligation bond issued by a city
or county to finance a STAR bond project pursuant to subsection (a)(1) or
(a)(2).
(b) (1) Subject to the provisions of subsection (b)(2), any city shall
have the power to issue full faith and credit tax increment bonds to finance
the undertaking, establishment or redevelopment of any major motorsports
complex, as defined in K.S.A. 12-17,162, and amendments thereto. Such
full faith and credit tax increment bonds shall be made payable, both as to
principal and interest: (A) From the revenue sources identified in
subsection (a)(1) or by any combination of these sources; and (B) subject
to the provisions of subsection (b)(2), from a pledge of the city's full faith
and credit to use its ad valorem taxing authority for repayment thereof in
the event all other authorized sources of revenue are not sufficient.
(2) Except as provided in subsection (b)(3), before the governing
body of any city proposes to issue full faith and credit tax increment bonds
as authorized by this subsection, the feasibility study required by K.S.A.
12-17,166(b), and amendments thereto, shall demonstrate that the benefits
derived from the project will exceed the cost and that the income
therefrom will be sufficient to pay the costs of the project. No full faith
and credit tax increment bonds shall be issued unless the governing body
states in the resolution required by K.S.A. 12-17,166(e), and amendments
thereto, that it may issue such bonds to finance the proposed STAR bond
project. The governing body may issue the bonds unless within 60 days
following the conclusion of the public hearing on the proposed STAR
bond project plan a protest petition signed by 3% of the qualified voters of
the city is filed with the city clerk in accordance with the provisions of
K.S.A. 25-3601 et seq., and amendments thereto. If a sufficient petition is
filed, no full faith and credit tax increment bonds shall be issued until the
issuance of the bonds is approved by a majority of the voters voting at an
election thereon. Such election shall be called and held in the manner
provided by the general bond law. The failure of the voters to approve the
issuance of full faith and credit tax increment bonds shall not prevent the
city from issuing special obligation bonds in accordance with this section.
No such election shall be held in the event the board of county
commissioners or the board of education determines, as provided in
K.S.A. 12-17,165, and amendments thereto, that the proposed STAR bond
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project district will have an adverse effect on the county or school district.
(3) As an alternative to subsection (b)(2), any city which adopts a
STAR bond project plan for a major motorsports complex, but does not
state its intent to issue full faith and credit tax increment bonds in the
resolution required by K.S.A. 12-17,166(e), and amendments thereto, and
has not acquired property in the STAR bond project area may issue full
faith and credit tax increment bonds if the governing body of the city
adopts a resolution stating its intent to issue the bonds and the issuance of
the bonds is approved by a majority of the voters voting at an election
thereon. Such election shall be called and held in the manner provided by
the general bond law. The failure of the voters to approve the issuance of
full faith and credit tax increment bonds shall not prevent the city from
issuing special obligation bonds pursuant to subsection (a)(1). Any project
plan adopted by a city prior to the effective date of this act in accordance
with K.S.A. 12-1772, and amendments thereto, shall not be invalidated by
any requirements of this act.
(4) During the progress of any major motorsports complex project in
which the project costs will be financed, in whole or in part, with the
proceeds of full faith and credit tax increment bonds, the city may issue
temporary notes in the manner provided in K.S.A. 10-123, and
amendments thereto, to pay the project costs for the major motorsports
complex project. Such temporary notes shall not be issued and the city
shall not acquire property in the STAR bond project area until the
requirements of subsection (b)(2) or (b)(3), whichever is applicable, have
been met.
(5) Full faith and credit tax increment bonds issued under this
subsection shall be general obligations of the city and are declared to be
negotiable instruments. Such bonds shall be issued in accordance with the
general bond law. All such bonds and all income or interest therefrom shall
be exempt from all state taxes. The amount of the full faith and credit tax
increment bonds issued and outstanding which exceeds 3% of the assessed
valuation of the city shall be within the bonded debt limit applicable to
such city.
(6) Any city issuing full faith and credit tax increment bonds under
the provisions of this subsection may refund all or part of such issue
pursuant to the provisions of K.S.A. 10-116a, and amendments thereto.
(c) (1) For each project established by a city or county financed with
special obligation bonds payable from the revenues described in
subsection (a)(1) and (a)(2), the city or county shall prepare and submit to
the secretary by October 1 of each year, a report describing the status of
any projects within such STAR bond project area, any expenditures of the
proceeds of special obligation bonds that have occurred since the last
annual report and any expenditures of the proceeds of such bonds expected
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to occur in the future, including the amount of sales tax revenue, how such
revenue has been spent, the projected amount of such revenue, the
anticipated use of such revenue and the names of the owners, partners,
officers or principals of any developer and of any associated business
partners of any developer that are involved in the STAR bond project. The
department of commerce shall compile this information and submit a
report annually to the governor and the legislature by February 1 of each
year.
(2) (A) In addition to the report referenced in paragraph (1), the
department of commerce, in cooperation with the department of revenue,
shall submit a report to the senate commerce committee and the house
commerce, labor and economic development committee by January 31 of
each session. The report shall include the following information for the last
three calendar years and the most current year-to-date information
available with respect to each STAR bond district:
(i) The gross annual sales, gross annual sales projected pursuant to
the STAR bond project plan and feasibility study, gross annual sales
required to meet bond debt service requirements and other expenses,
amount of sales tax collected and the amount of any "base" sales taxes
being allocated to the district;
(ii) the total amount of bond payments and other expenses incurred;
(iii) the total amount of bonds issued and the balance of the bonds, by
district and by project in the district;
(iv) the remaining cash balance in the project to pay future debt
service and other expenses;
(v) any new income producing properties being brought into a district
and the base revenue going to the state general fund and incremental sales
tax increases going to the district with respect to such properties;
(vi) the amount of bonds issued to repay private investors in the
project with calculations showing the private and state share of
indebtedness;
(vii) the percentage of local effort sales tax actually committed to the
district compared to the state's share of sales tax percentage committed to
the district;
(viii) the number of out-of-state visitors to a project and description
of the data gathered pursuant to the visitor tracking plan, including, but not
limited to, residence zip code data, a discussion of the visitor attraction
properties of projects in the districts, and a comparison of the number of
out-of-state visitors with the number of in-state visitors; and
(ix) the number of businesses that have moved into and out of
each STAR bond district;
(x) (a) the number of businesses that relocated from a Kansas
location into each STAR bond district;
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(b) the amount of sales tax revenue lost from the sales tax base of
each STAR bond district as the result of businesses moving out of the
district or going out of business; and
(c) the total aggregate amount of local sales tax revenue lost to all
jurisdictions outside STAR bond districts as the result of such
relocations; and
(ix)(xi) if any information or data is not available, an explanation as
to why it is not available.
(B) Either the senate commerce committee or the house committee on
commerce, labor and economic development may amend the information
required in the report with additional requests and clarification on a going
forward basis.
(3) Cities, counties and developers shall provide all information
requested by the secretary for the secretary's database as provided by
K.S.A. 2024 {2025} Supp. 74-50,227, and amendments thereto. If the city
or county has a website, a conspicuous link directly to the information
pertaining to the city or county's STAR bond project on the secretary's
database shall be placed on the city's or county's website. A separate link
shall be provided for each STAR bond project of the city or county.
(d) The reports pursuant to subsection (c)(1) and (2) shall include a
description of all state, federal and local tax incentives that apply within
the STAR bond district or to any business located in the district.
(e) (1) A city or county may use the proceeds of special obligation
bonds or any uncommitted funds derived from sources set forth in this
section to pay the bond project costs as defined in K.S.A. 12-17,162, and
amendments thereto, to implement the STAR bond project plan.
(2) As authorized by the secretary, the Kansas development finance
authority may issue and use the proceeds of special obligation bonds to
pay the bond project costs as defined in K.S.A. 12-17,162, and
amendments thereto, to implement a STAR bond project plan for a project
as defined in K.S.A. 12-17,162(aa)(2), and amendments thereto.
(f) With respect to a STAR bond project district established prior to
January 1, 2003, for which, prior to January 1, 2003, the secretary made a
finding as provided in subsection (a) that a STAR bond project would
create a major tourism area for the state, such special obligation bonds
shall be payable both as to principal and interest, from a pledge of all of
the revenue from any transient guest, state and local sales and use taxes
collected from taxpayers as provided in subsection (a) whether or not
revenues from such taxes are received by the city.
Sec. 9. 6. K.S.A. 12-17,172 is hereby amended to read as follows: 12-
17,172. (a) Any city or county which has adopted a STAR bond project
plan in accordance with the provisions of this act may purchase or
otherwise acquire real property in connection with such project plan. Upon
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a 2/3 vote of the members of the governing body thereof, a city or county
may acquire by condemnation any interest in real property, including a fee
simple title thereto, which it deems necessary for or in connection with any
project plan of an area located within the project district; however, eminent
domain may be used only as authorized by K.S.A. 26-501b, and
amendments thereto.
Any such city or county may exercise the power of eminent domain in
the manner provided by K.S.A. 26-501 et seq., and amendments thereto. In
addition to any compensation or damages allowed under the eminent
domain procedure act, such city or county shall also provide for the
payment of relocation assistance as provided in K.S.A. 12-17,173, and
amendments theretoNo city or county shall exercise eminent domain
power to acquire real property for a STAR bond project.
(b) Any real property otherwise acquired by a city or county under
the provisions of K.S.A. 26-501 et seq., and amendments thereto, may be
sold, transferred or leased to a developer, in accordance with the STAR
bond project plan and under such other conditions as may be agreed upon.
Any real property acquired pursuant to this section that is sold, transferred
or leased to a project developer for a specific project shall be sold,
transferred or leased to such developer on the condition that such property
shall be used only for that specific approved project. If the developer does
not utilize the entire tract of the real property acquired pursuant to this
section that is sold, transferred or leased in accordance with the STAR
bond project plan, that portion of property not used shall not be sold,
transferred or leased by the developer to another developer party, but shall
be deeded back to the city or county. If the developer paid the city or
county for the land, a percentage of the original purchase price paid to the
city or county which that represents the percentage of the entire tract being
deeded back to the city or county shall be reimbursed to the developer
upon the deeding of the property back to the city or county.
(c) Any transfer by the project developer of real property acquired
pursuant to this section shall be valid only if approved by a 2/3 majority
vote of the members of the governing body of this the city or county
where such real property is located.
Sec. 10. 7. K.S.A. 12-17,179 is hereby amended to read as follows:
12-17,179. (a) A city that created a redevelopment district in an eligible
area that was approved for STAR bonds prior to the effective date of this
act for the city of Manhattan Discovery Center on December 28, 2006, and
the Schlitterbahn project in Wyandotte county on December 23, 2005, may
by ordinance elect to have the provisions of this act applicable to such
redevelopment district.
(b) Subject to the provisions of section 61(h) of chapter 5 of the 2020
Session Laws of Kansas, The provisions of this act K.S.A. 12-17,160 et
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seq., and amendments thereto, regarding STAR bond projects shall expire
on and after July 1, 2026 2031.
Sec. 11. K.S.A. 12-3402 is hereby amended to read as follows: 12-
3402. (a) (1) It is the purpose of this act to promote, stimulate and develop
the general welfare, economic development and prosperity of the state of
Kansas by authorizing port authorities to be established in each city and
each county of the state that shall achieve such purpose by:
(A) Fostering the growth of intrastate and interstate commerce within
the state; to promote;
(B) promoting the advancement and retention of ports within the
state; to encourage and assist in the location of
(C) assisting and encouraging new business and industry in this state
and the expansion, relocation or retention of existing business and industry
when so doing will help maintain existing levels of commerce within the
state or increase the movement of commodities, goods and products
produced, manufactured or grown within or without the state through
existing ports within the state or lead to the development of new ports
within the state; and to promote
(D) promoting the economic stability of the state by maintaining and
providing employment opportunities, thus promoting the general welfare
of the citizens of this state, by authorizing port authorities to be established
in each city and in each county of the state.
(2) A port authority shall be a public body corporate and politic ,
which if established , shall be known as the "port authority" of the city or
of the county. Joint port authorities may be created under authority of this
act by cooperative agreement executed by the governing bodies of any city
or county or cities or counties. Such joint authorities formed by such
cooperative agreement shall have all the powers and jurisdiction
enumerated in this act. Such creation shall be by ordinance or resolution.
Except for port authorities created prior to April 1, 1981, no port authority
shall be created without approval of the legislature by concurrent
resolution or by the enactment of a bill . The authority shall not transact
any business or exercise powers hereunder pursuant to this section until
the passage of a concurrent resolution or the enactment of a bill by the
legislature as hereinbefore provided.
(3) No port authority located in Cowley county shall modify, amend
or extend the port authority's official plan as originally adopted by the port
authority to change the purpose for which it was created or alter the
character of the work to be undertaken, as provided by K.S.A. 12-3406,
and amendments thereto, without approval of the legislature by concurrent
resolution or the enactment of a bill . The port authority shall not transact
any business or exercise powers hereunder pursuant to this section
concerning any business or actions related to such modification,
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amendment or extension of the original plan.
(4) A cooperative agreement creating a joint port authority may be
amended by the governing bodies of the cities and counties which that
comprise such port authority. Any amendment to such a cooperative
agreement, including amendments which that allow other cities located
within counties which that are parties to the original agreement to join in
such agreement, shall not require approval by the legislature.
(5) No member of the authority shall serve as such who owns own
land, other than a residence, or represents represent in a fiduciary capacity
or as agent any person who owns land surveyed or examined for port
locations, except that this prohibition shall not prevent a user of a port
facility from serving as a member of the authority.
(6) A port authority may sue and be sued, plead and be impleaded,
subject to the limitations and other provisions of the Kansas tort claims
act. The exercise by such port authority of the powers conferred upon it
shall be deemed to be essential governmental functions of the creating city
or county.
(b) Any city or county creating or participating in the creation of a
port authority, before any taxes are levied shall submit the question of
whether an annual tax levy may be made on the assessed taxable tangible
property of such city, county, or a combination thereof, and the amount
thereof to the electors of such city or county comprising such authority. If
a majority of those voting on the question vote in favor of such tax levy,
the same tax may be made levied for such purpose and to pay a portion of
the principal and interest on bonds issued under the authority of K.S.A. 12-
1774, and amendments thereto, by cities located in the county, and
otherwise such tax levy shall not be made . If a majority of those voting on
the question vote against such tax levy, the tax shall not be levied, unless
approved by the majority of the electors at a subsequent election on a
question of whether such a tax should be levied for such purpose. If such
tax levy is approved, the authority may expend funds not otherwise
appropriated to defray the expense of surveys and examinations incidental
to the purposes of the port authority and may expend funds for any of the
purposes as set forth in K.S.A. 12-3406, and amendments thereto.
(c) Subject to making due provisions for payment and performance of
its obligations, a port authority may be dissolved by the city or county, or
combination thereof, comprising it the port authority . If the port authority
is dissolved, the properties of the port authority shall be transferred to the
subdivision comprising it the port authority , or, if comprised by more than
one city or county, to the city or county comprising it the port authority in
such manner as may be agreed upon by them. Obligations of the authority
shall not be obligations of the state of Kansas, nor of any city or county
which creates the authority, unless the obligations are specifically
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approved by a majority vote of the electors of such city or county voting
on the issue. Notice of such election shall be published in a newspaper of
general circulation in the county or counties once each week for two
consecutive weeks. The first publication shall be not less than 21 days
prior to such election. Such notice shall set forth the time and place of
holding the election and the issue which the vote is to determine.
Sec. 12. 8. K.S.A. 12-17,160, 12-17,166, 12-17,172 , and 12-17,179
and 12-3402 and K.S.A. 2024 2025 Supp. 12-17,162, 12-17,164 and 12-
17,169 are hereby repealed.
Sec. 13. 9. This act shall take effect and be in force from and after its
publication in the statute book.
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