Kentucky Administrative Regulations
Title 702 - EDUCATION AND WORKFORCE DEVELOPMENT CABINET - BOARD OF EDUCATION, DEPARTMENT OF EDUCATION - OFFICE OF DISTRICT SUPPORT SERVICES
Chapter 3 - School Administration and Finance
Section 702 KAR 3:020 - Bond issue approval
Current through Register Vol. 50, No. 9, March 1, 2024
RELATES TO: KRS 58.150, 156.070, 156.200, 156.210, 162.080, 162.090, 162.100, 162.120-162.290, 162.300, 162.385
Section 1. The Commissioner of Education shall determine the financial soundness of all school revenue bond issues. He shall supervise all phases of school revenue and voted bonds.
Section 2. The Commissioner of Education shall disapprove the sale of any school revenue or school voted bond issue which he deems to be not in accord with Kentucky Board of Education administrative regulations or financially unsound for the district in question.
Section 3. Fiscal agents shall be registered with the Department of Financial Institutions in the Commonwealth of Kentucky. The local board of education shall select the fiscal agent for the proposed revenue bond issue. The fiscal agent shall employ appropriate bond counsel subject to approval of the local board of education. The allowable discount on bonds shall not exceed two (2) percent of the par value of the issue under contract.
Section 4. Twenty (20) percent of the fund to Support Education Excellence in Kentucky (SEEK) capital outlay funds shall be set aside as a safety factor in determining the initial bonding potential of a local district. The Commissioner of Education may allow safety factors below twenty (20) percent to a minimum of ten (10) percent on a case by case basis dependent upon the financial stability of the individual school district. The following sources of revenue shall be eligible as annual revenues in support of school building revenue bonds or notes:
Section 5.
Section 6. The maximum net interest cost for the sale of school revenue bonds established by the Kentucky Board of Education shall be a rate no greater than the most current Bond Buyer's 20 -Bond Index plus one and five-tenths (1.5) percent. If a bid on an issue of bonds exceeds the maximum interest rate, the Commissioner of Education may declare an emergency to exist and request the chairman to convene the Kentucky Board of Education for the purpose of approving or disapproving his recommendation that the bonds be sold.
STATUTORY AUTHORITY: KRS 58.150(1), 156.070(1), 160.160, 162.160, 162.170, 162.180