Kentucky Bills

Create new sections of KRS Chapter 138 to define terms; impose a 4% state retail regulatory license fee on all alcoholic beverage and cannabis-infused beverage sales to consumers by alcoholic beverage retailers; establish procedures and duties of retailers; impose state wholesale regulatory license fees on alcoholic beverages and cannabis-infused beverages and state retail regulatory license fees on kratom, hemp-derived, and cannabinoid products; set out regulatory license fee rates, deductions for timely filing and payment, and licensee duties; amend KRS 211.285 to fund the alcohol wellness and responsibility education fund with 0.5% of the collected state retail regulatory license fees; create a new section of KRS Chapter 217 to establish Department for Public Health laboratory and testing standards and procedures; amend KRS 241.010 to define "state or national conference" and redefine "alcoholic beverages"; amend KRS 241.069 to delete outdated language; amend various sections of KRS Chapter 243 to establish state license fees for new and existing license types; limit licensee discipline to only the specific license in question; establish a souvenir package license for distillers; authorize distillers, small farm wineries, and microbreweries to allow leashed dogs on their premises; allow caterers and special temporary auction licensees at state and national conferences; modify the privileges for various licensees, including a wholesaler, Class B distiller, and special agent or solicitor; add references to the new tax structure and statutes; modify requirements for public notice of a license application; sunset existing excise, wholesale, and other taxes on July 1, 2027, as they relate to alcoholic beverages and cannabis-infused beverages; repeal and reenact KRS 243.075, relating to local regulatory license fees, to allow any moist or wet city or county to impose the fee; authorize audits of each city's or county's regulatory license fee fund by the Auditor of Public Accounts for the most recent 10 years; describe audit penalties for cities and counties that fail to substantially comply; direct cities and counties to reduce the regulatory license fee to 3% within 4 years; limit future cities and counties to a 1% regulatory license fee; amend KRS 244.080 to permanently prohibit a retail license from using a premises if the licensee sold to minors at that premises 3 or more times in 24 months; amend KRS 244.585 to establish limitations for agreements between distributors and breweries or microbreweries; amend KRS 131.250, 139.010, 243.045, 243.430, 243.790, 243.850, and 243.990 to conform; EFFECTIVE, in part, July 1, 2027; EMERGENCY.

Amend KRS 65.003, relating to local ethics, to specify the composition of the commission in a consolidated local government and allow the commission to use the county attorney's office for legal council by procurement methods; amend KRS 67C.103 to place controls on council district formation and redistricting and to allow regulations issued by local health boards and local solid waste management boards operating under KRS Chapter 109 or 212 that apply to individuals residing or businesses operating within the jurisdiction of the consolidated local government be subject to being overridden by the consolidated local government council within 45 days of issuance; prohibit the council from not accepting legislation with specified form requirements of KRS 83A.060; allow the consolidated local government council, or either of the 2 major political caucuses, to hire or retain legal counsel; create a new section of KRS Chapter 67C to require an office of internal audit to be created and headed by a chief audit executive who is appointed; amend KRS 67C.115 and 69.210 to conform; amend KRS 67C.111 to allow cities of 3,000, rather than 6,000, to be incorporated in the boundaries of the consolidated local government and set the petition requirement relating to incorporation to 66% rather than 75% and grant 1 year for the petition to be completed; amend KRS 67C.147 to allow the consolidated local government council to sub-classify property into land and improvements for purposes of levying the ad valorem tax within the area formerly comprising the city of the first class; establish controls on the calculation of the compensating tax rate and the 4% tax rate, and the application of the homestead exemption; outline the transition of presently serving ethics commission members; outline transition from the current chief audit executive to the appointed position.

Create a new section of KRS Chapter 199 related to the quality-based graduated early care and education rating system program to establish the intent of the General Assembly related to the program; establish processes and procedures for how the program is changed by administrative regulation; require a program modernization plan and final recommendations for modernization to be created and submitted to the Legislative Research Commission; amend KRS 199.891 to define terms; create new requirements for how the Cabinet for Health and Family Services establishes and operates the Certified Child Care Community Designation Program; delete language related to a previous 1 time requirement for the cabinet to submit recommendations and best practices to the Legislative Research Commission; establish a new January 1, 2028 submission deadline for the cabinet to make publicly available a standardized application for certification and instructions for the program; establish new requirements for applications by local governments to participate in the program; require an annual report by the Cabinet for Economic Development regarding the program; amend KRS 199.8983 to increase the membership of the Kentucky Child Care Advisory Council; establish that the council shall additionally advise the Cabinet for Health and Family Services on the operations, funding, and licensing of child-care microcenters; create new sections of KRS Chapter 199 to define terms; establish licensure for child-care microcenters; establish the Kentucky Child-Care Microcenter Program to regulate the standards and operations of child-care microcenters; establish early care and education training requirements for licensed child-care providers and certified family child-care home providers; establish that the Education and Labor Cabinet shall compile, produce, and make publicly available a monthly report providing a comprehensive snapshot of all licensed and certified child care services, Head Start services, child care services regulated by the United States Department of Defense, and state-funded public preschool services operating within the Commonwealth; establish a voluntary designation process through which any licensed or certified child-care provider may identify as a faith-based program; require the Office of State Budget Director to produce a comprehensive annual report outlining all state and federal spending on child care and early childhood education services and submit it annually to the Legislative Research Commission; establish that the Cabinet for Health and Family Services shall submit an approval request to the federal Administration for Children and Families to utilize a cost estimation model to inform payment rates beginning with the fiscal year 2028-2030 Child Care and Development Fund state plan; amend KRS 199.882 to change the definitions of "contribution" and "state match" and define "third-party administrator"; amend KRS 199.883 to establish that the Cabinet for Health and Family Services shall enter into a contract with a private third-party administrator to administer the Employee Child Care Assistance Partnership Program and establish duties and requirements of the third-party administrator; amend KRS 199.885 to establish the third-party administrator is responsible for issuing state fund matches out of the Employee Child Care Assistance Partnership fund; amend KRS 199.886 and 199.887 to specify how employers and employees interact directly with the third-party administrator instead of the Cabinet for Health and Family Services.

Direct the Auditor of Public Accounts to commission a study of applicable statutes, administrative regulations, and agency policies and processes that directly impact opening and operating licensed and certified child care services in the Commonwealth; require the Auditor to procure a vendor to conduct the study; report findings and recommendations of the study to the Legislative Research Commission by December 1, 2027, for referral to the Interim Joint Committee on Families and Children.

Amend KRS 158.4433 to move the school mapping data program to the Kentucky 911 Services Board, specify responsibility for mapping data accuracy walk-through; amend KRS 65.7629 and 158.442 to conform; APPROPRIATION; EMERGENCY.

Create new sections of KRS Chapter 353 to establish the purposes of the Act; define terms; require and specify the types of permits before constructing or operating a carbon dioxide facility; exempt enhanced oil or gas recovery under KRS 353.592; require any oil, natural gas or coalbed methane well converted to a carbon dioxide sequestration well to be governed by this Act; set forth the requirements and process to obtain a Class VI underground injection control permit; require permit fees to be put in the carbon dioxide sequestration facility administrative fund; set forth a process for commercially valuable minerals; designate the consent of owners of pore space for a administratively complete application; specify when the Energy and Environment Cabinet can begin technical review of the application; require financial responsibility sufficient to cover specific activities and cabinet review of financial responsibility annually; provide that the cabinet's determination is considered final; allow for the adjustment of financial responsibility based on adjustments in cost estimates; list the type of financial instruments which can be used as qualifying financial responsibility instruments; authorize the cabinet to promulgate administrative regulations for financial responsibility; identify reasons why the cabinet would deny an application for a permit; authorize the cabinet to restore applicant eligibility for permit under specific grounds and circumstances; require cabinet approval for a transfer of a permit and allow obligations and rights to pass to the new transferee; require periodic review of permits; prescribe the notice and comment requirements for a Class VI permit; delineate the cabinet's actions for applications that are complete and incomplete; prohibit the approval or transfer of a permit to an operator for conditions specified and allow eligibility after an applicant, operator, or control person takes certain remedial actions; establish requirements to maintain the integrity of carbon sequestration wells and notification of affected parties when activities occur on the well site; provide mechanism of redress for parties that are not in agreement over activities on the well site; specify the requirements for plugging and abandoning a Class VI well or monitoring well; authorize the secretary of the Energy and Environment Cabinet to enter into cooperative agreements; specify the requirements for a completion certificate issued by the Energy and Environment Cabinet after demonstrating compliance for 50 years or another time frame designated by the cabinet along with notice and public hearing; require ownership transferred to the Commonwealth and that both pore and surface owners are held harmless from liability; establish a carbon dioxide sequestration facility administrative fund and specify the moneys to be placed into the fund and the purposes and uses of the fund; establish an application fee to be paid to the carbon dioxide sequestration facility administrative fund and authorize the cabinet to promulgate administrative regulations for a fee schedule; establish a carbon dioxide sequestration facility trust fund and specify the purposes and use of moneys in the fund; require sequestration operators to pay a fee on each ton of carbon dioxide sequestered and have the fees remitted to the carbon dioxide sequestration facility trust fund; require the cabinet to prepare an annual report on the Class VI underground injection control permit and the carbon dioxide sequestration facility trust fund; state that the report is due December 31 of each year beginning with the receipt of the first application for an underground injection control permit; require the Energy and Environment Cabinet to certify the amount of carbon dioxide sequestered by each permittee and allow amounts sequestered to be used for a carbon dioxide credits, allowances, trading, emissions allocations, or offsets; prohibit the altering of legal rights or relationships of several mineral estates and pore space owners in common law; specify methods for nonconsenting owners; allow for the cabinet to make a determination on missing or nonconsenting pore space owners for a sequestration facility and notice for a pooling order; require the applicant to pay the cost of administrative hearing with a pooling order; establish notice for a pooling order and the compensation of owners; establish requirements for seismic survey of lands; require operator to deposit funds for unknown or missing pore space owners and allow funds to be moved to the carbon dioxide sequestration facility trust fund after 7 years; create a severability clause; establish violations and penalties; require notice and service for violations and establish courts with jurisdiction and a requirement for a stay of notice and administrative hearing; authorize the cabinet to promulgate administrative regulations to develop regulatory program for the administration of the underground injection control program; repeal KRS 353.800, 353.802, 353.804, 353.806, 353.808, 353.810, and 353.812, relating to geologic storage of carbon dioxide.

Create new sections of KRS Chapter 13A to nullify an administrative regulation relating to the Medicaid outpatient pharmacy program, after that administrative regulation was found deficient during the 2026 Regular Session of the General Assembly; nullify 2 emergency administrative regulations of the Department of Alcoholic Beverage Control relating to tobacco, nicotine, or vapor product licenses, after those administrative regulations were found deficient during the 2026 Regular Session of the General Assembly; EMERGENCY.

Amend KRS 304.39-020, relating to personal injury protection benefits, to modify requirements for certain medical expenses paid by a reparation obligor; amend KRS 304.39-130 to increase the allowable weekly reimbursement for work loss and other loss; amend KRS 304.39-210 to establish requirements for a reparation obligor paying medical expenses and a person submitting and collecting medical expenses; create a new section of KRS Chapter 15 to provide the Attorney General with concurrent jurisdiction in the investigation and prosecution of offenses under KRS 304.47-020; amend KRS 304.47-020 to conform; create a new section of Subtitle 47 of KRS Chapter 304 to require the insurance commissioner to publish an annual insurance fraud report; direct that certain provisions apply to basic and added reparation benefits issued or renewed on or after the effective date of the Act.

Amend KRS 197.020 to establish that the Department of Corrections shall not be required to promulgate administrative regulations regarding the death penalty; establish that execution protocols and procedures may be prescribed by internal policy, memorandum, or another form of action; amend KRS 13A.105 to conform; make technical corrections.

Create a new section of KRS Chapter 605 to establish requirements that the Cabinet for Health and Family Services shall determine for all children in the care and custody of the cabinet whether each child is receiving or eligible for earned federal benefits administered by the United States Social Security Administration or the United States Department of Veterans Affairs, including survivor or dependent benefits; require the cabinet to establish a program to be called the Success Sequence Savings and Disbursement Plan; require the promulgation of administrative regulations to implement the new requirements.

Amend KRS 139.340 to redefine the sales and use tax nexus standard for remote retailers and marketplace providers to include a sales volume threshold only; amend KRS 131.383 and 141.044 to allow the Department of Revenue to refund an estimated tax payment in the event the payment was submitted to the department in error; amend KRS 96.895 to require reporting by the Department for Local Government to the Legislative Research Commission related to the Tennessee Valley Act in lieu of tax payments; amend KRS 154.30-030 to sunset the tax increment financing state-participation programs; allow TIF projects approved prior to this date to continue to be governed in accordance with the tax incentive agreement's terms and conditions; amend KRS 141.010, 141.019, and 141.039 to conform to the Internal Revenue Code in effect on December 31, 2025, for taxable years beginning on or after January 1, 2026; decouple from certain IRC provisions; delay the deferred tax deduction until January 1, 2028; create a new section of KRS Chapter 138 to define terms and impose an excise tax on fantasy contests; set requirements for administering the tax; amend KRS 139.010 to define "data brokering services"; amend KRS 139.200 to impose sales and use taxes on pay phones and data brokering services; amend KRS 139.202 to exempt from the tax pre-existing lease or rental agreements; amend KRS 224.50-868 to extend the fee currently imposed for each new motor vehicle, trailer, or semitrailer tire sold in Kentucky to July 1, 2028; amend KRS 224.50-872 to require reporting by the Energy and Environment Cabinet to the Legislative Research Commission on the waste tire trust fund; amend KRS 45.760 and 45.770 to limit the transfer of moneys for a capital project from 15% to 5%; amend KRS 45.345 and create new sections of KRS Chapters 65, 160, and 367 to define terms and require rounding of cash transactions to the nearest $.05 increment; amend KRS 139.210 to prohibit retailers from being relieved of their responsibility to collect the correct amount of sales tax regardless of the purchaser' s payment method; create new sections of KRS Chapter 65 in relation to regional industrial development districts to prioritize the purposes for organizing the district; exclude cities and school occupational license taxes from the single occupational license tax imposition restriction; require the fee to expire the earlier of date bonds issued are retired or 20 years; require notification to all local governments with territory in the boundaries of the multicounty region before interlocal agreement is executed; prohibit inclusion of any portion of a city that has not consented to participation; require reporting to the Department for Local Government and the Legislative Research Commission; amend KRS 143A.030 to tax fluorspar as a natural resource; amend KRS 143A.010 to add fluorspar to the definition of "natural resources"; amend KRS 140.160, relating to the inheritance and estate taxes, to extend the deadline for filing a tax return from 18 months to 36 months for deaths on or after July 1, 2026; amend KRS 140.210 to correspondingly extend the due date for payment of tax and discount; amend KRS 134.490 to modify notification requirements for third-party purchasers of delinquent taxes; amend KRS 138.130 to define "premium cigar," and amend "vending machine operator" to include cigarettes, tobacco products, vapor products, or a combination thereof; amend KRS 138.140 to tax premium cigars at the rate of 15% of the actual price up to 60 cents per cigar; require an annual CPI adjustment for the maximum rate and publication on the Department of Revenue's website; amend KRS 138.195 to require a vending machine operator to secure a license for dispensing tobacco products and vapor products in vending machines; amend KRS 141.0205 to order income tax credits; amend KRS 131.190 to allow the Department of Revenue to report on certain credits to the Legislative Research Commission; amend KRS 160.613 to impose the utility gross receipts license tax on the furnishing of pay phone service; amend KRS 139.538 to sunset sales and use tax exemptions for filming and producing motion pictures in this state July 1, 2028; amend KRS 132.096, 139.480, 139.4802, 139.481, 141.0401, 141.206 to delete tax exemptions for property certified as a fluidized bed energy production facility; amend KRS 139.481 to extend the agricultural exemption license number for sales and use taxes to 6 months; amend KRS 154.20-236 to end further applications for the Kentucky Angel Investment ; amend KRS 141.065 to sunset the credit for hiring the unemployed as of January 1, 2028; amend KRS 141.412 to sunset the qualified farming operation credit as of January 1, 2028; amend KRS 151B.402 to sunset the employer High School Equivalency Diploma program incentive credit as of January 1, 2028; amend KRS 171.396 to allocate 15% of the certified rehabilitation credit cap to owner-occupied residential property and 85% to all other property; define "commercial residential property" and "median family income"; amend KRS 171.397 to sunset the current application process; create a new section of KRS Chapter 171 to establish 2 application rounds by which the certified rehabilitation credit may be applied for; allow credit based on 30% of the qualified rehabilitation expenses if the commercial residential property is affordable to households earning 80% of the median family income; amend KRS 441.135 to require compensation received from disposal of property that was purchased from a jail canteen account to be returned to the canteen account; require reporting of proceeds by the jailer; create a new section of KRS Chapter 224A to require an administrative fee of 0.5% to be paid for each project funded by the Infrastructure for Economic Development Fund for Coal-Producing Counties and the Infrastructure for Economic Development Fund for Tobacco Counties; amend KRS 45.050 require audit expenses of audits with federal funds to be paid by the agency being audited; amend KRS 18A.080 Executive branch agencies assessed for the operation of the Personnel Board; require the amount to be determined and collected by Finance and Administration Cabinet based on the number of full-time employees of each agency on July 1; amend KRS 151.723 to prohibit state and local taxes on water withdrawal fees; amend KRS 304.17B-021 to require insurance premium and retaliatory taxes for accident and health and insurance premiums to be deposited into the general fund; amend KRS 11.068 to require the Office of State Budget Director to publish on its website by September 1 of each year an estimate of general fund and road fund revenue loss from tax expenditures; create a new section of KRS Chapter 16 to require billing of Kentucky State Police security services provided to nonstate-operated events; create a new section of KRS Chapter 138 to impose a new excise tax on predictive markets; define terms; amend KRS 160.470 to increase the publication requirements when a local board of education proposes to levy a general tax rate; amend KRS 132.017 to require the petition committee challenge information be published on the home page of the county clerk's website; amend KRS 160.473 to prohibit a personal property tax rate levied by a local board of education to be higher than the rate levied on January 1, 2026; amend KRS 160.607 to prohibit an occupational license tax from being imposed in a school district that does not currently have one imposed as of January 1, 2026; prohibit an occupational license tax rate levied for a school district to increase on or after January 1, 2026; amend KRS 160.613 to prohibit a utility gross receipts license tax from being imposed in a school district that does not currently have one imposed; prohibit a utility gross receipts license tax rate from increasing on or after January 1, 2026; amend KRS 11A.211 to increase the registration fee for each employer of one or more executive agency lobbyist and each real party in interest from $500 to $750; amend KRS 278.010 to define “municipal interlocal gas utility”; exempt “municipal interlocal gas utility” from the definition of “utility”; amend KRS 65.230 to define “municipal interlocal gas utility”; create a new section of KRS 65.210 to 65.300 to provide that municipal interlocal gas utilities shall be considered special purpose governmental entities and pay an annual fee to the Department for Local Government; amend KRS 65.240 to allow public agencies to enter into agreements to acquire natural gas facilities outside of its municipal jurisdictional boundaries; amend KRS 96.5375 to allow municipal interlocal gas utilities to extend or construct natural gas systems outside the constituents city’s boundaries; define municipal interlocal gas utility; allow for the selling or disposal of real property purchased with capital construction funds or equipment or state funds; require reporting of property sold or disposed; require school districts receiving urgent needs school allotments to reimburse the Commonwealth; amend various other sections to conform; make technical changes; repeal KRS 160.621, 160.625, 160.627, 160.633, 160.472, 211.390, and 211.392; EFFECTIVE, in part, August 1, 2026, and January 1, 2027; RETROACTIVE, in part to January 1, 2020; EMERGENCY.

Create new sections of KRS Chapter 194A to establish the Kentucky statewide health data utility; define terms; establish purposes and a restricted fund for the utility; require the executive director of the Office of Data Analytics to be responsible for the development, implementation, operation, and maintenance of the utility, contract with a consortium of public health colleges to operate and govern the utility, and promulgate administrative regulations to carry out those duties; establish functions and content of utility; create a consortium of public health colleges; establish duties of consortium in operating and governing the utility; establish administration and operation requirements for the consortium; establish the Kentucky Health Information Technology Board; require the board to establish policies and procedures for the sharing and submission of health information, approve data control, governance, and privacy practices, and advise the executive director and the consortium; require the utility's participants to comply with health information sharing and submission requirements within certain timeframes; require the secretary of the Cabinet for Health and Family Services to enforce the mandatory reporting requirements for the utility's participants; establish enforcement powers of secretary including civil penalty assessment; require the consortium and the executive director to make annual reports relating to the utility; amend KRS 194A.030, 194A.101, 194A.103, 194A.095, 205.640, 205.6489, 211.474, 214.375, and 311A.190 to conform; repeal KRS 216.2920, 216.2921, 216.2923, 216.2925, 216.2927, and 216.2929, relating to health data collection; establish timeframe for making initial appointments, and provide for staggered appointments to the board; require the Cabinet for Health and Family Services or the Department for Medicaid Services to seek federal approval if it is determined that such approval is necessary; provide authorization from the General Assembly to make changes in the Medicaid program as required under KRS 205.5372(1); EFFECTIVE, in part, July 1, 2028.