Secretary of State
Committee Passes Kentucky Business Enhancement Legislation
(Frankfort, KY) The Kentucky House Judiciary Committee took an important first step today in substantially modernizing and enhancing Kentucky partnership law for the first time in over fifty years. House Bill 234, sponsored by Rep. Scott Brinkman (R-Louisville), will align Kentucky law with the most recent version of the Uniform Partnership Act, as approved by the National Conference of Commissioners on Uniform State Laws. Thirty-seven other states have adopted the legislation since the latest update of the Act in 1997.
“Adopting the updated Uniform Partnership Act will make Kentucky a more enticing business environment and will enhance the Commonwealth’s efforts to attract and retain new and growing businesses,” stated Secretary of State Trey Grayson whose office has been working with the sponsor and the Business Law Section of the Kentucky Bar Association to draft the legislation. “Passage of this bill will bring partnership law in line with modern business practices and trends and is essential if Kentucky’s business climate wants to remain competitive with the rest of the country.”
The bill levels the playing field by bringing Kentucky into conformity with the rest of the country’s business practices. Some of its provisions include language that moves Kentucky from an aggregate approach to partnership law to an entity model. This change will clarify that a partnership is an entity distinct from its partners; thus, it can take legal action and can acquire property the way other entities are able to do so. The partners will also have separate rights and liabilities from the partnership.
Rep. Brinkman expressed his gratitude for the bills passage by stating, “I am very appreciative of the committee and Chairman Gross for addressing this important legislation. This will modernize our partnership laws and thus help Kentucky better compete in the 21st century economy.”
The conformity this bill provides with other states will ease the burden on businesses seeking to relocate or expand into Kentucky. Additionally, the changes will allow businesses greater flexibility in determining their form of corporate structure.
Also testifying on behalf of the bill were Tom Rutledge, an authority on business law from the firm of Stoll, Keenon and Ogden and Allan Vestal, Dean of the University of Kentucky School of Law.
“The partnership that has been developed to pass this important legislation has been an incredible benefit to the business community of Kentucky,” Grayson stated, referring to the team of individuals who have worked for the bill’s passage. “I commend Rep. Brinkman and Chairman Gross Lindsey (D-Henderson) for working to bring this issue before the committee. Their efforts will certainly be remembered as vital to the modernization of Kentucky Business Law.”
In addition to House Bill 234, Secretary of State Trey Grayson is pushing for other enhancements to Kentucky business law including the modernization of Kentucky corporation limited liability statutes (House Bill 349 and House Bill 350). Rep. Brinkman, in addition to other legislators, will sponsor the Kentucky Business Enhancement Legislation, a portion of Secretary Grayson’s overall legislative package for the 2006 General Assembly Session.
# # #