Expands state contracts to include memoranda of agreement, program administration contracts, and personal service contracts; authorizes the secretary of Finance and Administration Cabinet to review administrative regulations and policies and procedures governing timely payments, reimbursement, and dispute resolution for contracts; requires all contracts to include provisions for negotiated terms for timely payments, penalties, payment dispute and resolution process, partial payment terms, and invoice procedures; requires notice for errors in an invoice or other requirement; requires notice for interest accrual; applies a 1% per month interest penalty for late payments; permits interest and costs of credit for a loan, line of credit, revolving credit, or other financial instrument taken due to a late payment; requires a 10 day correction period; requires a report every 6 months by the Finance and Administration Cabinet. UPDATE - LINE-ITEM VETO to no longer require new administrative regulations on policies and procedures governing timely payments, partial payments, reimbursement, and dispute resolution for contract payments; also removes a provision that would have allowed state dollars to be spent to provide school resource officers (SROs) at private schools.