(Frankfort, KY) The Kentucky legislature took major steps, today, to tear down the bureaucratic red tape it takes to start a business in Kentucky. The legislature passed Senate Bills 150, 151, and 152, sponsored by Senator Tom Jensen (R-London), chairman of the Senate Judiciary Committee. The bills include the Kentucky Business Filing Act and the 2010 Kentucky Entities Act. Most importantly, the legislation makes it easier for citizens who want to start their companies in Kentucky to navigate the complicated legislation that governs it.

 

“So often, Kentucky statutes deter individuals from starting their own businesses because there are unwieldy and convoluted,” stated Secretary Grayson. “This legislative package makes it easier for the average citizen to get their businesses off the ground, and there could not be a better time for this bureaucratic relief than during this economic downturn. We need to do all that we can to make it easier for business to get up and going in this day in age.”

 

Constituents of the Office of the Secretary of State will notice most of the changes in Senate Bill 151 upon its enactment. SB 151, or the Kentucky Business Filing Act, centralizes in one set of provisions those elements that are common to all or nearly all business entities. This will greatly reduce the volume of statutes regarding business entities and also reduce the confusion of multiple statutory references for similar subjects. Citizens will now have a clearer direction on how to create and maintain their companies in Kentucky.

 

Senate Bill 150, or the 2010 Kentucky Business Entities Bill, includes many changes that will make the operations of the Office of the Secretary of State more efficient. However, it also addresses issues such as the confirmation of personal responsibility for person’s negligent or wrongful acts in limited liability provision as well as great consistencies of disinterestedness requirement in certain votes in Limited Liability Companies and for the rights of the holder of a charging order. It also expresses authorization for a court-ordered meeting of a board of directors and addresses the ability of a member in a single member LLC to resign and thereby, on a prospective basis, terminate fiduciary obligations.

 

"In recent years Kentucky has taken significant steps to modernize and rationalize its business entity laws; Senate Bills 150 and 151 further those efforts.  While more work remains to be done, we are at the cutting edge of the laws needed by our business men and women," Tom Rutledge, a member of the Business Entities and Transactions Practice Group at Stoll, Keenon, and Ogden PLLC and the bill’s principal drafter.

 

Grayson has twice before led the effort to pass major business modernization legislation. In 2007, Grayson supported Rep. Scott Brinkman’s (R-Louisville) House Bill 334, that was signed into law. SB 152 seeks to clarify the language of HB 334. During the 2006 session, the Generally Assembly passed legislation that substantially modernized and enhanced Kentucky partnership law for the first time in over fifty years. House Bill 234, also sponsored by Rep. Brinkman, aligned Kentucky law with the most recent version of the Uniform Partnership Act,as approved by the National Conference of Commissioners on Uniform State Laws. The two bills, at the time, represented the largest changes to Kentucky Business Entity Legislation in decades, only to be eclipsed by the latest legislation. 

 

During Grayson’s tenure in office, Grayson has rapidly become known as an innovator for business services.  Since Grayson took office six years ago, the Office has launched over 15 new online business services or upgrades to further those missions.  Now, a vast majority of services that the Office provides can be found online. 

 

Just last year, Grayson launched ‘FastTrack Business Registration,’ an online business registration system that reduces the number of days it takes for companies to begin conducting business in Kentucky. Currently, three million documents are available on the Secretary of State’s website.  These services and online documents has allowed the office to become more efficient.

 

Since Grayson assumed office in 2004, the office has reduced its number of full-time employees by 12%, eliminated nearly all part-time employees, reduced its operating budget by nearly 15%, and consolidated the number of physical offices from two to one.

 

“It is our responsibility to provide the most efficient and accessible service, in the most environmentally friendly way possible,” said Secretary Grayson.  “The changes we have made to this office are the kind of transformations that government should be making in the 21st Century, where we do more with less by creating a 24-hour a day online service center.”

 

The Office of the Secretary of State is entrusted with filing, maintaining, and preserving the important documents and records of the Commonwealth and her people.  Access to documents not found online is available at the State Capitol Building in Frankfort, KY. 

 

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