306 KAR 1:010. Definitions for 306 KAR Chapter 1.

      RELATES TO: KRS 154.45-001-154.45-120, 26 U.S.C. A sections 167, 168, 179

      STATUTORY AUTHORITY: KRS 154.45-070

      NECESSITY, FUNCTION, AND CONFORMITY: This administrative regulation establishes definitions for terms used in relation to the Kentucky Enterprise Zone Program.

      Section 1. Definitions. (1) "Area" means a census block or group of census blocks for which census data is available, as determined by Employment Services.

      (2) "Authority" means the Kentucky Enterprise Zone Authority.

      (3) "Building materials" means tangible personal property that enters into and becomes a permanent part of a building or other structure on land as an improvement to real property. The term shall not include tangible personal property used in the ordinary repair, maintenance or improvement of existing structures, except for remodeling or rehabilitation.

      (4) "Designee" means the authorized representative of the local enterprise zone.

      (5) "Employment Services" means the Workforce Development Cabinet, Department for Employment Services.

      (6) "Equipment" means an asset used in the operation of a business that is subject to depreciation pursuant to 26 USCA sections 167 and 168, (Internal Revenue Code), including an asset expensed pursuant to 26 USCA section 179. The term "equipment" shall not include the following:

      (a) Tangible personal property used to maintain, restore, mend, or repair machinery or equipment;

      (b) Consumable operating supplies;

      (c) Office supplies; or

      (d) Maintenance supplies.

      (7) "Existing business" is defined in KRS 154.45-010(4).

      (8) "Machinery" means an asset used in the operation of a business that is subject to depreciation pursuant to 26 USCA sections 167, 168, and 179, including an asset expensed pursuant to 26 USCA sections 167, 168, and 179 that meets the following criteria:

      (a) A mechanical device or an integrated combination of mechanical devices designed to perform or produce, through the transmission of force, motion, or energy from one (1) part of the device or devices to another, a certain function, result, or effect;

      (b) Material incorporated into the machinery as a part of its installation; and

      (c) Attached equipment necessary to the mechanical operation of the machinery. "Machinery" shall not include tangible personal property used to maintain, restore, mend or repair machinery.

      (9) "New business" is defined in KRS 154.45-010(6).

      (10) "Qualified business" is defined in KRS 154.45-010(7).

      (11) "Remodeling" means the alteration of an existing building or structure if the value for property tax purposes is increased by at least twenty (20) percent.

      (12) "Rehabilitation" means the restoration from a state of decay of an existing building or structure that has been unoccupied for a continuous period of at least twelve (12) months.

      (13) "Substantial performance in the zone" means a service performed by an employee of a qualified business either:

      (a) At the location of the qualified business in the enterprise zone; or

      (b) Outside the enterprise zone, if:

      1. The service performed outside the enterprise zone is directed exclusively from the location of the qualified business within the enterprise zone; and

      2. The employee does not have a separate business location outside the enterprise zone.

      (14) "Targeted workforce" is defined in KRS 154.45-010(9).

      (15) "Unemployed" means a person who received no wages or received wages of $1,000 or less for the ninety (90) day period prior to being hired by a business located within the enterprise zone. (9 Ky.R. 748; eff. 6-1-83; Am. 13 Ky.R. 2035; eff. 7-2-87; 18 Ky.R. 2876; eff. 4-14-92; 27 Ky.R. 217; 757; eff. 9-11-2000.)