Bill Text: PA SB279 | 2009-2010 | Regular Session | Introduced


Bill Title: Further defining "tax increment" and "tax increment base"; and further providing for determination of tax increment and tax increment base and for allocation of positive tax increments.

Spectrum: Bipartisan Bill

Status: (Introduced - Dead) 2009-02-19 - Referred to FINANCE [SB279 Detail]

Download: Pennsylvania-2009-SB279-Introduced.html

  

 

    

PRINTER'S NO.  283

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

SENATE BILL

 

No.

279

Session of

2009

  

  

INTRODUCED BY BROWNE, EARLL, BOSCOLA, ERICKSON, WOZNIAK, STACK AND M. WHITE, FEBRUARY 19, 2009

  

  

REFERRED TO FINANCE, FEBRUARY 19, 2009  

  

  

  

AN ACT

  

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Amending the act of July 11, 1990 (P.L.465, No.113), entitled

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"An act providing for the creation of tax increment

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districts; providing for additional powers and duties to be

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exercised by redevelopment authorities and by industrial and

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commercial development authorities; authorizing the creation

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and approval of project plans for tax increment financing;

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providing for the establishment of a tax increment base;

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allocating the payment of positive tax increments; providing

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for the financing of project costs; and providing for the

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issuance of tax increment bonds and notes," further defining

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"tax increment" and "tax increment base"; and further

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providing for determination of tax increment and tax

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increment base and for allocation of positive tax increments.

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The General Assembly of the Commonwealth of Pennsylvania

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hereby enacts as follows:

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Section 1.  The definitions of "tax increment" and "tax

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increment base" in section 3 of the act of July 11, 1990 (P.L.

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465, No.113), known as the Tax Increment Financing Act, amended

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December 16, 1992 (P.L.1240, No.164), are amended to read:

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Section 3.  Definitions.

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The following words and phrases when used in this act shall

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have the meanings given to them in this section unless the

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context clearly indicates otherwise:

 


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* * *

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"Tax increment."  Generally, the incremental tax revenues,

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determined with reference to the tax increment base, resulting

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from the increase in property values or from the increase in

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commercial activity as a result of a project. More specifically,

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the term includes the following:

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(1)  The incremental tax revenues resulting from an

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increase in the total market value of taxable real property

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situated in a tax increment district and an increase in the

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business use and occupancy of such taxable real property.

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This paragraph applies only to ad valorem taxes on real

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property and tax imposed by the governing body on the use and

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occupancy of real property.

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(2)  The payment in lieu of taxes assigned to or agreed

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to be paid by governmental entities or nonprofit

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organizations with property situated or otherwise assignable

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to a tax increment district. Whether all or only a portion of

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this payment is to be considered part of the tax increment

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shall be determined at the time the tax increment district is

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created.

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(3)  The incremental tax revenues resulting from an

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increase in total taxable sales and rentals of tangible

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personal property and in the rendition of taxable services by

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vendors located in a tax increment district. [This paragraph

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applies only to a sales tax levied by a governing body.]

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(4)  The incremental tax revenues resulting from an

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increase in total gross receipts or gross or net profits or

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income realized by persons or entities from business

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conducted in a tax increment district. This paragraph applies

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only to those taxes levied under the authority of the act of

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August 5, 1932 (Sp.Sess., P.L.45, No.45), referred to as the

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Sterling Act, the act of December 31, 1965 (P.L.1257, No.

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511), known as The Local Tax Enabling Act, and the act of May

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30, 1984 (P.L.345, No.69), known as the First Class City

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Business Tax Reform Act.

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"Tax increment base."  The term means one or more of the

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following, as appropriate:

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(1)  The aggregate market value of all taxable real

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property located within a tax increment district on the date

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the district is created.

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(2)  In a district where the governing body has levied a

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tax on the business use and occupancy of real estate, the

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average aggregate market value of real property located

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within the district and used or occupied for business

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purposes during the last available 12-month period preceding

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the date of creation of the district.

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(3)  [In a district where the governing body has levied a

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sales tax, the] The total amount of taxable sales, rentals

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and services subject to the sales tax of the Commonwealth

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pursuant to Article II of the act of March 4, 1971 (P.L.6,

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No.2), known as the Tax Reform Code of 1971, and occurring

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within the district during the last calendar year or the last

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available 12-month period preceding the date of creation of

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the district.

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(4)  In a district where the governing body has levied a

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mercantile license tax, business privilege tax, net profits

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tax or similar tax for the privilege of engaging in business

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within the district, the total amount of taxable gross

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receipts, net income or net profits, as the case may be,

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realized by taxpayers at locations within the district during

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their last taxable period which ended before the date of

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creation of the district.

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* * *

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Section 2.  Section 6(b) of the act, amended December 16,

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1992 (P.L.1240, No.164), is amended and the section is amended

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by adding a subsection to read:

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Section 6.  Determination of tax increment and tax increment

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base.

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* * *

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(b)  Determination of base.--Upon application in writing by

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the finance officer of the municipality which created the

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district, the assessor for that municipality shall determine,

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according to its best judgment from all sources available to it,

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the full aggregate market value of the taxable property in the

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district as of the date on which the district was created. The

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finance officer of the municipality may determine the sales tax

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base of a sales tax levied by a governing body or any other tax

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increment base contemplated hereby, except for the State sales

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tax base, in any manner which is reasonable and prudent and

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meets sound business practice.

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(b.1)  Determination of sales tax base.--Upon application in

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writing by the finance officer of the municipality which created

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the district, the Department of Revenue shall calculate the

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State sales tax base pursuant to Article II of the act of March

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4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971,

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with respect to vendors located within the tax incentive

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district.

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* * *

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Section 3.  Section 7 of the act is amended by adding a

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subsection to read:

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Section 7.  Allocation of positive tax increments.

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* * *

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(b.1)  Determination and transfer of State sales tax

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increments.--Within 30 days of the end of each quarter, the

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Department of Revenue shall calculate and notify the Secretary

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of the Budget of the amount of the positive State sales tax

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increment allocable to each tax increment district. Within ten

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days of receiving such notification, the Secretary of the Budget

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shall direct the State Treasurer to transfer an amount equal to

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the State sales tax increment from the General Fund to the

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appropriate issuing authority.

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* * *

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Section 4.  This act shall apply to tax increment districts

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created after the effective date of this section.

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Section 5.  This act shall take effect in 60 days.

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