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12-1742. Conditions of leases and lease-purchase agreements; origination fee; apportionment of payments in lieu of taxes; administrative costs. Such agreements shall provide for a rental sufficient to repay the principal of and the interest on the revenue bonds. Such agreements also may provide that the lessee shall reimburse the city or county for its actual costs of administering and supervising the issue. The city or county may charge an origination fee. Such fee shall not be deemed a payment in lieu of taxes hereunder. Such fee shall be used exclusively for local economic development activities but shall not be used to pay any administrative costs of the city or county. Except for the origination fee, all other fees paid in excess of such actual costs and any other obligation assumed under the contract shall be deemed payments in lieu of taxes and distributed as provided herein. If the agreement provides for a payment in lieu of taxes to the city or county, such payment, immediately upon receipt of same, shall be transmitted by the city or county to the county treasurer of the county in which the city is located. Payments in lieu of taxes received pursuant to agreements entered into after the effective date of this act shall include all fees or charges paid for services normally and customarily paid from the proceeds of general property tax levies, except for extraordinary services provided for the facility or an extraordinary level of services required by a facility. Payments in lieu of taxes may be required only upon property for which an exemption from ad valorem property taxes has been granted by the state board of tax appeals. The county treasurer shall apportion such payment among the taxing subdivisions of this state in the territory in which the facility is located. Any payment in lieu of taxes shall be divided by the county treasurer among such taxing subdivisions in the same proportion that the amount of the total mill levy of each individual taxing subdivision bears to the aggregate of such levies of all the taxing subdivisions among which the division is to be made. For purposes of this section, the total mill levy shall not include the mill levy imposed pursuant to K.S.A. 72-53,113, and amendments thereto. The county treasurer shall pay such amounts to the taxing subdivisions at the same time or times as their regular operating tax rate mill levy is paid to them. Based upon the assessed valuation which such facility would have if it were upon the tax rolls of the county, the county clerk shall compute the total of the property taxes which would be levied upon such facility by all taxing subdivisions within which the facility is located if such property were taxable.

History: L. 1961, ch. 81, § 3; L. 1967, ch. 92, § 1; L. 1981, ch. 74, § 6; L. 1982, ch. 298, § 20; L. 1987, ch. 72, § 1; L. 1992, ch. 280, § 51; L. 2008, ch. 109, § 28; L. 2014, ch. 141, § 22; L. 2017, ch. 95, § 55; July 1.

Cross References to Related Sections:

Agreements with owners of property for payments in lieu of taxes, see 12-147.

Law Review and Bar Journal References:

Constitutionality of ten year industrial revenue bond property taxation provision of K.S.A. 79-201a discussed in note, 24 K.L.R. 723, 724 (1976).

Attorney General's Opinions:

Redevelopment of central business district areas; special obligation tax increment bonds; payments in lieu of taxes. 92-63.

CASE ANNOTATIONS

1. Act does not contravene various provisions of Kansas constitution and bill of rights. State, ex rel., v. City of Pittsburg, 188 Kan. 612, 613, 614, 615, 619, 620, 621, 364 P.2d 71.

2. Section is a constitutional delegation of legislative authority. State ex rel. Tomasic v. City of Kansas City, 237 Kan. 572, 586, 701 P.2d 1314 (1985).

3. Leases under act true leases, not mortgages, and therefore subject to assumption/rejection requirements of bankruptcy code. In re Petroleum Products, Inc., 72 B.R. 739, 741 (1987).


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