65.1575 Charitable community foundations -- Relationship with local governments.

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Page 1 of 2 65.1575 Charitable community foundations -- Relationship with local governments. (1) As used in this section: (a) "Foundation" means a charitable community foundation established to accept gifts, bequests, devises, or other transfers for the purpose of meeting charitable objectives for the citizens of the community; (b) "Local government" means every city, regardless of classification, every county, and every charter county and urban-county government; (c) "Component fund" means an individual fund treated as part of a foundation and that meets the requirements established under regulations promulgated implementing 26 U.S.C. sec. 170 as amended from time to time; and (d) "Nonprofit organization" means an organization incorporated under KRS Chapter 273 and exempt under Section 501(c)(3) of the Internal Revenue Code. (2) (a) A local government may donate to a foundation the proceeds from the sale of any utility or facility or any grant, bequest, or devise received by it. (b) A local government may contribute to a nonprofit organization exempt under Section 501(c)(3) of the Internal Revenue Code for the development and operation of a community center or recreational facilities. (3) If the foundation receives a gift from a local government that is subject to conditions, limitations, or requirements by the donor, the gift shall be segregated in a component fund within the foundation, which shall be subject to conditions, limitations, or requirements that are substantially identical to those established by the donor. (4) If the foundation receives a gift from a local government that is not subject to any specified conditions, limitations, or requirements by the donor, the gift amount shall be maintained in a component fund. The income from the fund shall be distributed to the local government for charitable purposes as directed by an ordinance of the governing body of the local government. (5) If a nonprofit organization receives a gift from a local government, it shall maintain the financial records so as to be able to ascertain the use of the donated funds. (6) The foundation or nonprofit organization exempt under Section 501(c)(3) of the Internal Revenue Code shall return any donations to the general fund of a local government if: (a) The foundation or nonprofit organization exempt under Section 501(c)(3) of the Internal Revenue Code loses its status as a public charitable organization; (b) The foundation or nonprofit organization exempt under Section 501(c)(3) of the Internal Revenue Code is liquidated; or (c) The foundation or nonprofit organization exempt under Section 501(c)(3) of the Internal Revenue Code violates any condition, limitation, or requirement as established by the local government governing body. Effective: July 15, 2002 Page 2 of 2 History: Amended 2002 Ky. Acts ch. 290, sec. 1, effective July 15, 2002. -- Created 1998 Ky. Acts ch. 332, sec. 1, effective July 15, 1998.