KRS § 441.635 — KY Code / Title XL / Chapter 441 / Section 441.635
441.635 Leases between authority and local governments authorized -- Contents
Status: in_force

441.635 Leases between authority and local governments authorized -- Contents.

The authority and any local government are authorized and empowered to enter into a

lease with respect to any project according to any agreement or agreements made

pursuant to KRS 441.630. Any lease may contain, in substance, any of the following

provisions and such other provisions not inconsistent herewith as the authority and local

government may deem appropriate and desirable:

(1) That the lease is for the remainder of the fiscal period in which it is dated and

executed, and is automatically renewable for the succeeding fiscal period, one (1) at

a time, until the final maturity date of the bond issue to which the lease is related, or

until the local government notifies the authority in writing within sixty (60) days

before the expiration of the lease that the local government will not renew said

lease;

(2) That with respect to the fiscal period in which the lease is dated and executed, the

local government shall otherwise be firmly bound only (a) to contribute to the

authority such portions, if any, of the cost of the project as the agreement prescribes

shall be paid by the local government; and (b) to pay the authority the rental

prescribed for such fiscal period;

(3) That if the local government shall fully perform all such obligations during such

initial term of the lease, it shall have an exclusive option to automatically renew the

lease at the time and in the manner prescribed for the ensuing fiscal period,

effective on the first day thereof; no local government shall be or become in any

way obligated to pay the rental stipulated for such fiscal year unless the lease be so

automatically renewed; and that the local government shall, upon any such renewal,

be firmly bound to pay to the authority the rental stipulated for such fiscal period as

a general obligation of the local government to be paid from any funds available to

the local government required by law or by previous binding contract to be devoted

to some other purpose;

(4) In like manner and subject to the same conditions and provisions as are set forth in

subsection (3) of this section, if the local government shall in the first ensuing fiscal

year fully perform its obligations and pay to the authority the rental stipulated for

such fiscal period, the local government shall have another exclusive option to

automatically renew such lease for another fiscal year, and so on for successive

fiscal periods until the final fiscal period for which the lease may be renewed;

(5) That so long as the lease is renewed from time to time and the local government

fully performs all its obligations as lessee, including payment of the rental

stipulated in the lease,

(a) The revenues of the project shall be collected, segregated, distributed,

deposited, secured, disbursed and accounted for in strict conformity with the

proceedings and trust indenture of the authority, and the aggregate of such

revenues properly accounted for and deposited pursuant to said proceedings

and trust indenture shall, to the extent provided in the lease, be a credit against

the local government's rental or other obligations for the current fiscal period

under the term of the lease, and

(b) Any revenues collected pursuant to KRS 441.685, or other funds as may be

provided and made available to the authority by the Commonwealth or other

sources, and set aside pursuant to an agreement, shall be applied as provided

in said proceedings and trust indenture and shall, to the extent provided in the

lease, be a credit against the local government's rental or other obligations for

the then current fiscal period under the lease.