AGO 1989-016.

Case DateFebruary 13, 1989
CourtKansas
Kansas Attorney General Opinions 1989. AGO 1989-016. February 13, 1989ATTORNEY GENERAL OPINION NO. 89-16Mr. Frank E. White, Jr. Chautaqua County Attorney 121 N. Chautaqua P.O. Box 6 Sedan, Kansas 67361 Re: Bonds and Warrants--Cash-Basis Law--Lease or Installment-Purchase Agreements; Contracts for Services Synopsis: Based upon commonly accepted and statutory definitions of the terms installment-contract and purchase, and mindful of the intent of the legislature to provide additional authority to acquire equipment, it is our opinion that K.S.A. 10-1116b does not authorize installment-purchase contracts for services. Cited herein: K.S.A. 10-1101; 10-1116b; 84-1-201(32); 84-2-612(1). * * * Dear Mr. White: As Chautaqua County Attorney you request our opinion concerning K.S.A. 10-1116b. Specifically, you ask whether the authority contained therein pertains only to the installment purchase of tangible property or if it also allows installment purchase of services, with the contract extending over several years. K.S.A. 10-1116b provides:
"Nothing in the provisions of K.S.A. 10-1101 et seq. shall prohibit a municipality from entering into (1) an agreement to pay for electric interconnection or transmission facilities or services, (2) a lease agreement, with or without an option to buy, or (3) an installment-purchase agreement, if any of such agreements specifically state that the municipality is obligated only to pay periodic payments or monthly installments under the agreement as may lawfully be made from (a) funds budgeted and appropriated for that purpose during such municipality's current budget year or (b) funds made available from any lawfully operated revenue producing source." (Emphasis added).
Thus, provided the agreement specifically states the required language concerning the extent of obligation undertaken by a municipality, K.S.A. 10-1116b allows a municipality to enter into an installment-purchase agreement. The issue therefore becomes what types of agreements can be defined as installment-purchase agreements. K.S.A. 10-1101 et seq. does not define installment-purchase agreement. Installment is generally defined as "partial payment of a debt or collection of a receivable. Different portions of this same debt payable at different successive periods as agreed. Partial payments on account of a debt due." Blacks Law...

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