HB 2179--Am.
As Amended by House Committee
Session of 1997
By Committee on Economic Development

10 AN ACT concerning tax increment financing; providing for use thereof 11 for residential purposes; amending K.S.A. 1996 Supp. 12-1771 and 12 repealing the existing section. 13 14 Be it enacted by the Legislature of the State of Kansas: 15 Section 1. K.S.A. 1996 Supp. 12-1771 is hereby amended to read as 16 follows: 12-1771. (a) No city shall exercise any of the powers conferred 17 by K.S.A. 12-1770 et seq., and amendments thereto, unless the governing 18 body of such city has adopted a resolution finding that the specific project 19 area sought to be developed or redeveloped is a blighted area, a conser- 20 vation area or, was designated prior to July 1, 1992, as an enterprise zone 21 pursuant to K.S.A. 12-17,110 prior to its repeal, or a residential devel- 22 opment incentive area and the conservation, development or redevel- 23 opment of such area is necessary to promote the general and economic 24 welfare of such city. Enterprise zones designated prior to July 1, 1992, 25 may be enlarged by the city to an area not exceeding 25% of the city's 26 land area upon a finding by the secretary of the department of commerce 27 and housing that a redevelopment project proposed by the city which 28 requires the enlargement is of statewide importance and that it will meet 29 the criteria specified in K.S.A. 12-1774 (a)(1)(D), and amendments 30 thereto. For the purpose of this subsection, the term ``blighted area'' 31 means an area which: (1) Because of the presence of a majority of the 32 following factors, substantially impairs or arrests the sound development 33 and growth of the municipality or constitutes an economic or social lia- 34 bility or is a menace to the public health, safety, morals or welfare in its 35 present condition and use: (A) A substantial number of deteriorated or 36 deteriorating structures; (B) predominance of defective or inadequate 37 street layout; (C) unsanitary or unsafe conditions; (D) deterioration of site 38 improvements; (E) diversity of ownership; (F) tax or special assessment 39 delinquency exceeding the fair value of the land; (G) defective or unusual 40 conditions of title; (H) improper subdivision or obsolete platting or land 41 uses; (I) the existence of conditions which endanger life or property by 42 fire and other causes; or (J) conditions which create economic obsoles- 43 cence; or (2) has been identified by any state or federal environmental HB 2179--Am.

 1  agency as being environmentally contaminated to an extent that requires
 2  a remedial investigation, feasibility study and remediation or other similar
 3  state or federal action; or (3) previously was found by resolution of the
 4  governing body to be a slum or a blighted area under K.S.A. 17-4742 et
 5  seq., and amendments thereto; or (4) is composed of open land that, be-
 6  cause of its location within the corporate boundary of a city, is necessary
 7  for sound community growth through platting or replatting and planning
 8  and development for primarily residential use a residential develop-
 9  ment incentive area.
10    For the purpose of this subsection, conservation area means any im-
11  proved area within the corporate limits of a city in which 50% or more
12  of the structures in the area have an age of 35 years or more, which area
13  is not yet blighted, but may become a blighted area due to the existence
14  of a combination of two or more of the following factors: (i) Dilapidation,
15  obsolescence or deterioration of the structures; (ii) illegal use of individual
16  structures; (iii) the presence of structures below minimum code stan-
17  dards; (iv) building abandonment; (v) excessive vacancies; (vi) overcrowd-
18  ing of structures and community facilities; or (vii) inadequate utilities and
19  infrastructure. Not more than 15% of the land area of a city may be found
20  to be a conservation area.
21    For purposes of this subsection, residential development incen-
22  tive area means any substantially open land that, because of its
23  location within the corporate boundary of any city, is necessary for
24  sound community growth through platting or replatting and plan-
25  ning and development for primarily residential use.
26    (b)  The powers conferred upon cities under the provisions of K.S.A.
27  12-1770 et seq., and amendments thereto, shall be exercised by cities, as
28  determined by resolution adopted pursuant to K.S.A. 12-1772, and
29  amendments thereto, (1) in enterprise zones designated prior to July 1,
30  1992, including any area added to such enterprise zone after July 1, 1992,
31  pursuant to subsection (a), (2) in blighted areas of cities and counties
32  described by subsection (a)(2), (3) in conservation areas of cities, or (4)
33  in blighted areas of cities, as determined by resolution adopted pursuant
34  to K.S.A. 17-4742 et seq., and amendments thereto, or in blighted areas
35    (5) in residential development incentive areas of cities as determined
36  by a resolution adopted pursuant to subsection (a)(4).
37    (c)  Within that portion of the city described in subsection (b), the
38  governing body of a city may establish a district to be known as a ``rede-
39  velopment district''. Within that portion of a city and county described in
40  subsection (b) excluding paragraph (3) of subsection (b), the governing
41  body of the city, upon written consent of the board of county commis-
42  sioners, may establish a district inclusive of land outside the boundaries
43  of the city to be known as a redevelopment district. In all such cases, the
HB 2179--Am.

 1  board of county commissioners, prior to providing written consent, shall
 2  be subject to the same procedure for public notice and hearing as is
 3  required of a city pursuant to subsection (d) for the establishment of a
 4  redevelopment district. One or more redevelopment projects may be un-
 5  dertaken by a city within a redevelopment district after such redevelop-
 6  ment district has been established in the manner provided by subsection
 7    (d).
 8    (d)  Any city proposing to establish a redevelopment district shall
 9  adopt a resolution stating that the city is considering the establishment
10  of a redevelopment district. Such resolution shall:
11    (1)  Give notice that a public hearing will be held to consider the
12  establishment of a redevelopment district and fix the date, hour and place
13  of such public hearing;
14    (2)  describe the proposed boundaries of the redevelopment district;
15    (3)  describe a proposed comprehensive plan that identifies all of the
16  proposed redevelopment project areas and that identifies in a general
17  manner all of the buildings and facilities that are proposed to be con-
18  structed or improved in each redevelopment project area;
19    (4)  state that a description and map of the proposed redevelopment
20  district are available for inspection at a time and place designated;
21    (5)  state that the governing body will consider findings necessary for
22  the establishment of a redevelopment district.
23    Notice shall be given as provided in subsection (c) of K.S.A. 12-1772,
24  and amendments thereto.
25    (e)  Upon the conclusion of the public hearing, the governing body
26  may adopt a resolution to make any findings required by subsection (a)
27  and may establish the redevelopment district by ordinance. Such reso-
28  lution shall contain a comprehensive plan that identifies all of the pro-
29  posed redevelopment project areas and identifies in a general manner all
30  of the buildings and facilities that are proposed to be constructed or im-
31  proved in each redevelopment project area. The boundaries of such dis-
32  trict shall not include any area not designated in the notice required by
33  subsection (d). Any addition of area to the redevelopment district or any
34  substantial change to the comprehensive plan shall be subject to the same
35  procedure for public notice and hearing as is required for the establish-
36  ment of the district.
37    (f)  No privately owned property subject to ad valorem taxes shall be
38  acquired and redeveloped under the provisions of K.S.A. 12-1770 et seq.,
39  and amendments thereto, if the board of county commissioners or the
40  board of education levying taxes on such property determines by reso-
41  lution adopted within 30 days following the conclusion of the hearing for
42  the establishment of the redevelopment district required by subsection
43    (d) that the proposed redevelopment district will have an adverse effect
HB 2179--Am.

 1  on such county or school district.
 2    (g)  Any redevelopment plan undertaken within the redevelopment
 3  district may be in separate development stages. Each plan shall be
 4  adopted according to the provisions of K.S.A. 12-1772, and amendments
 5  thereto, and shall fix a date for completion. Except as provided herein,
 6  any project shall be completed within 20 years from the date of the es-
 7  tablishment of the redevelopment district. Projects relating to environ-
 8  mental investigation and remediation under subsection (i) shall be com-
 9  pleted within 20 years from the date a city enters into a consent decree
10  agreement with the Kansas department of health and environment or the
11  United States environmental protection agency.
12    (h)  Any increment in ad valorem property taxes resulting from a re-
13  development district undertaken in accordance with the provisions of this
14  act, shall be apportioned to a special fund for the payment of the cost of
15  the redevelopment project, including the payment of principal and inter-
16  est on any special obligation bonds or full faith and credit tax increment
17  bonds issued to finance such project pursuant to this act and may be
18  pledged to the payment of principal and interest on such bonds. The
19  maximum maturity on bonds issued to finance projects pursuant to this
20  act shall not exceed 20 years. For the purposes of this act, ``increment''
21  means that amount of ad valorem taxes collected from real property lo-
22  cated within the redevelopment district that is in excess of the amount
23  which is produced from such property and attributable to the assessed
24  valuation of such property prior to the date the redevelopment district
25  was established, as determined under the provisions of K.S.A. 12-1775,
26  and amendments thereto.
27    (i)  The governing body of a city, in contracts entered into with the
28  Kansas department of health and environment or the United States en-
29  vironmental protection agency, may pledge increments receivable in fu-
30  ture years to pay costs directly relating to the investigation and remedi-
31  ation of environmentally contaminated areas. The provisions in such
32  contracts pertaining to pledging increments in future years shall not be
33  subject to K.S.A. 10-1101 et seq. or 79-2925 et seq., and amendments
34  thereto.
35    (j)  Before any redevelopment project is undertaken, a comprehensive
36  feasibility study, which shows the benefits derived from such project will
37  exceed the costs and that the income therefrom will be sufficient to pay
38  for the project shall be prepared. Such feasibility study shall be an open
39  public record.
40    Sec. 2.  K.S.A. 1996 Supp. 12-1771 is hereby repealed.
41    Sec. 3.  This act shall take effect and be in force from and after its
42  publication in the statute book.