Law

State Business Incentives:
Larry Hayes, State Budget Director v. The State Property and Buildings Commission of Kentucky

The Court was called upon to review the constitutionality of the financial arrangements undertaken by the Commonwealth to convey a 1600-acre project site in Scott County which the Commonwealth would acquire and develop for $35 million. Kentucky was involved in a fierce competition with many of the other states of this nation regarding the location of a major automotive manufacturing plant by Toyota in the United States. The project site was part of a total package of inducements to Toyota to build a plant capable of producing up to 200,000 cars annually and employing up to 3,000 people. The Toyota agreement promises a total package of inducements which could have a direct cost to the state estimated at between $125,000,000 and $268,000,000.

The court held the legislation and the commonwealth's actions constitutional saying, "The law is available to any industrial entity which agrees to construct and install a facility which satisfies the standards provided by the Buildings Commission and otherwise meets the requirements of the act. Consequently it would be available to every industrial concern even those now operating within the Commonwealth of Kentucky in connection with any expansion of existing enterprises. The public purpose on which all industrial development legislation has been founded has been the inducement of the location of a project which performs the public purpose of providing employment to Kentucky citizens and alleviating any conditions of unemployment."

• Brief for Appellant-Special Amicus Curiae - 1987 [Download]
• Memo from Justice Wintersheimer to all Justices - 1987 [Download]
• Opinion of the Court - 1987 [Download]