KLC 2020 Legislative Update

6) LOCAL GOVERNMENT PROCEDURES
the SPGE is proposing the levy of a rate that is projected to generate more revenue than would
be generated by the levy of the compensating tax rate;
3.
4.
Approve a rate that is less than the proposed rate when the SPGE is proposing the levy of an ad
valorem tax for the first time; or
Disapprove the entire proposed rate by a majority vote of the governing body.
Approved rates may be implemented after all other statutory requirements, if any, for levying the
rate are met such as statutory rate limits, public hearing requirements, and recall provisions.
If the entire proposed rate is disapproved by the SPGE, the SPGE may levy a rate for the upcoming
year that does not exceed the compensating tax rate if the SPGE levied an ad valorem tax during the current
year. If the SPGE is proposing an ad valorem tax for the first time, the levy shall not be imposed and the
SPGE shall wait at least one year before proposing another ad valorem tax levy. The Department for Local
Government shall calculate rates upon request by a SPGE.
The following fees and charges are excluded from the requirement to submit proposed rates to
the city or county that established a SPGE: (1) rental fees; (2) fees established by contractual arrangement;
(3) admission fees; (4) fees or charges to recover costs incurred by a SPGE for the connection, restoration,
relocation, or discontinuation of any service requested by any person; (5) any penalty, interest, sanction, or
other fee or charge imposed by a SPGE for a failure to pay a charge or fee; (6) amounts charged to customers
or contractual partners for nonessential services provided on a voluntary basis; (7) fees or charges
authorized under federal law that pursuant to federal law may not be regulated by the Commonwealth
or local governments within the Commonwealth; (8) purchased water or sewage treatment adjustments
made by a SPGE as a direct result of a rate increase by its wholesale water supplier or wholesale sewage
treatment provider; (9) any new fee or fee increase for which a SPGE must obtain prior approval from the
Public Service Commission; (10) other charges or fees imposed by a SPGE for the provision of any service
that is also available on the open market; and (11) fees or charges imposed by municipal utilities for the
provision of power, water, wastewater, natural gas, or telecommunications services, unless submission is
otherwise required by statute or an ordinance adopted by the establishing entity.
KRS 65A.100 is repealed. The statute currently requires SPGEs that adopt a new fee or ad valorem
tax, or increase the rate at which an existing fee or tax is imposed, to report the fee or tax to the governing
body of the establishing entity for informational purposes only. The Act takes effect January 1, 2021.
Senator Ralph Alvarado (R-Winchester) speaks on
the Senate floor as members vote to override the
governor’s veto of SB 5.
Photo Courtesy: LRC Public Information
www.KLC.org
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