12-3804.   Same; findings required by governing bodies before issuance. No local unit of general government may issue industrial developmentbonds under the provisions of this act without a finding by the governmentbody:

      (a)   That the local unit of general government has a contract with anindividual, partnership or corporation to lease the property to be acquiredwith the proceeds of the industrial development bonds for occupancy and usein connection with the conduct of an industrial enterprise for a period ofyears, and for the lessee to pay an annual rental adequate to meet interestand principal payments falling due during the term of the lease:

      (b)   That the lessee of the property is a responsible party;

      (c)   That the contract for lease of the property provides for:

      (1)   The reasonable maintenance, less normal wear and tear, of theproperty by the lessee;

      (2)   insurance to be carried on the property and the use and dispositionof insurance moneys;

      (3)   the rights of the local unit of general government and the lesseerespecting the disposition of the property financed by the proposedindustrial development bonds upon retirement of the bonds or termination ofthe contract by expiration or by failure to comply with any of theprovisions thereof; and

      (4)   The lessee to provide lease guarantee insurance with a companyauthorized to do business in the state of Kansas sufficient to cover anyoutstanding indebtedness under the lease agreement, such insurance to befurnished by the lessee upon issuance of such bonds;

      (d)   That the contract provides for the rights of the bondholders, thecare and disposition of rental receipts, and such other safeguards as aredeemed to be necessary;

      (e)   That financing by banks, other financial institutions, or otherparties, of the property required by the lessee is not readily available tothe lessee on ordinary commercial terms in adequate amounts either on thelocal market or on the national market;

      (f)   That the facility offered the lessee is intended to accommodateexpansion of an enterprise located elsewhere or a new enterprise and notprimarily the relocation of an existing facility;

      (g)   That adequate provision is being made to meet any increased demandupon community public facilities that might result from the proposedproject; and

      (h)   That the issuance of the proposed bonds and the operation of theenterprise of the lessee will not disrupt the fiscal stability of theissuing local unit of general government in the event it should becomenecessary for it to assume responsibility for payment of the interest andprincipal of the proposed industrial development bonds.

      History:   L. 1974, ch. 49, § 4; July 1.