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| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
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| SENATE BILL |
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| INTRODUCED BY FOLMER, ROBBINS, ERICKSON, VANCE, RAFFERTY, PICCOLA, PIPPY, M. WHITE, ORIE, SCARNATI, EICHELBERGER, GORDNER, BAKER, D. WHITE, CORMAN, ALLOWAY, EARLL, WAUGH, VOGEL, BOSCOLA AND WONDERLING, FEBRUARY 17, 2009 |
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| REFERRED TO FINANCE, FEBRUARY 17, 2009 |
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| AN ACT |
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1 | Establishing spending limitations on the Commonwealth; providing |
2 | for the disposition of surplus funds; establishing the |
3 | Taxpayer Protection Fund; and repealing provisions of The |
4 | Fiscal Code relating to the funding of a stabilization |
5 | reserve. |
6 | The General Assembly of the Commonwealth of Pennsylvania |
7 | hereby enacts as follows: |
8 | Section 1. Short title. |
9 | This act shall be known and may be cited as the Taxpayer |
10 | Protection Act. |
11 | Section 2. Definitions. |
12 | The following words and phrases when used in this act shall |
13 | have the meanings given to them in this section unless the |
14 | context clearly indicates otherwise: |
15 | "Appropriation limit." The total of the amounts approved as |
16 | executive authorizations by the Governor plus the total amounts |
17 | of preferred and nonpreferred appropriations made by the General |
18 | Assembly from the General Fund during the fiscal year |
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1 | immediately prior to the budget year under consideration, |
2 | adjusted by the lesser of: |
3 | (1) the average percentage change in personal income in |
4 | this Commonwealth for the three preceding calendar years as |
5 | reported by the Federal Government or as determined pursuant |
6 | to an act of the General Assembly; or |
7 | (2) the average percentage change in inflation for the |
8 | three preceding calendar years plus the average percentage |
9 | change in the State population for the three preceding years |
10 | as reported by the annual Federal census estimates, such |
11 | number being adjusted every decade to match the official |
12 | Federal census. |
13 | "Average percentage change in inflation." The average of the |
14 | percentage change for each of the three calendar years, from |
15 | October to October, immediately preceding the calendar year in |
16 | which a given executive budget is submitted by the Governor, in |
17 | the Consumer Price Index for All Urban Consumers (CPI-U), not |
18 | seasonally adjusted, all items index or its successor index, as |
19 | officially reported by the United States Department of Labor, |
20 | Bureau of Labor Statistics. |
21 | "Average percentage change in personal income." The average |
22 | of the percentage change in personal income estimates for this |
23 | Commonwealth, from second calendar quarter to second calendar |
24 | quarter, for each of the three calendar years immediately |
25 | preceding the calendar year in which a given executive budget is |
26 | submitted by the Governor, as reported by the United States |
27 | Department of Commerce, Bureau of Economic Analysis, SQ4 |
28 | quarterly income summary for this Commonwealth or its successor |
29 | index or as determined pursuant to an act of the General |
30 | Assembly. |
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1 | "Average percentage change in State population." The average |
2 | of the percentage change in State population for each of the |
3 | three most recent years immediately preceding the calendar year |
4 | in which a given executive budget is submitted by the Governor, |
5 | as reported by the United States Census Bureau for July 1 of |
6 | each year. |
7 | "Mandated service." Any program or service administered by a |
8 | political subdivision of the Commonwealth as a result of being |
9 | required to provide that program or service by State law. |
10 | "Total spending by the Commonwealth." All General Fund |
11 | appropriations made by the General Assembly and all |
12 | appropriations from a constitutionally or statutorily |
13 | established fund created after the effective date of this |
14 | section. |
15 | Section 3. Spending limitations. |
16 | (a) General rule.--Total spending by the Commonwealth in any |
17 | fiscal year shall not exceed the spending appropriation limit as |
18 | set forth in this act. |
19 | (b) Mandated expenses for political subdivisions.--The |
20 | State's limit under section 3(a) shall be reduced by the amount |
21 | of the reduction in State appropriations to a political |
22 | subdivision for administration of a mandated service, without an |
23 | equal or greater reduction in State-mandated expenses for said |
24 | local government or a repeal of the mandate to provide a program |
25 | or service. |
26 | (c) Exceptions.--The appropriation limit of the Commonwealth |
27 | may be exceeded in any fiscal year for the following: |
28 | (1) To respond to a presidential or gubernatorial |
29 | declaration of emergency if the General Assembly approves by |
30 | two-thirds affirmative vote of the members elected to each |
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1 | house of the General Assembly. In no case shall the excess |
2 | spending authorized by exceeding the appropriation limit in |
3 | this manner be included in the computation base of the |
4 | appropriation limit for any subsequent fiscal year. |
5 | (2) In other situations if the Governor so requests, in |
6 | writing, 30 days prior to the constitutional deadline for |
7 | adoption of a budget for the next fiscal year, and |
8 | simultaneously publishes that written notice in a newspaper |
9 | of general circulation in each county and senatorial and |
10 | representative district in which such newspapers shall be |
11 | published, and the General Assembly subsequently approves by |
12 | an affirmative vote of two-thirds of the members elected to |
13 | each house of the General Assembly. |
14 | Section 4. Disposition of surplus funds. |
15 | (a) Transfer of surplus.-- |
16 | (1) Except as provided under paragraph (2), for any |
17 | fiscal year in which the Governor certifies that a surplus |
18 | exists, 25% of that surplus shall be deposited by the end of |
19 | the next succeeding quarter into the Budget Stabilization |
20 | Reserve Fund established in section 1701-A of the act of |
21 | April 9, 1929 (P.L.343, No.176), known as The Fiscal Code, |
22 | and 75% of that surplus shall be deposited by the end of the |
23 | next succeeding quarter into the Taxpayer Protection Fund |
24 | which is hereby established in the State Treasury. |
25 | (2) For any fiscal year in which the State Treasurer |
26 | certifies that the balance in the Budget Stabilization |
27 | Reserve Fund equals or exceeds 5% of the total of all General |
28 | Fund appropriations, 100% of the surplus certified by the |
29 | Governor under paragraph (1) shall be deposited into the |
30 | Taxpayer Protection Fund. |
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1 | (b) Distribution.-- |
2 | (1) Subject to the provisions of subsection (c), the |
3 | moneys in the Taxpayer Protection Fund shall be distributed |
4 | to taxpayers who have liability for the tax imposed under |
5 | Article III of the act of March 4, 1971 (P.L.6, No.2), known |
6 | as the Tax Reform Code of 1971, through a reduction in the |
7 | rate of such tax, which reduction shall be established by an |
8 | act of the General Assembly to be effective for January 1 |
9 | through December 31 of the subsequent calendar year. |
10 | (2) The Secretary of the Budget, in conjunction with the |
11 | Secretary of Revenue, shall certify the rate reduction for |
12 | the tax imposed under Article III of the Tax Reform Code of |
13 | 1971, for the upcoming calendar year no later than September |
14 | 30. The new rate shall be published in the Pennsylvania |
15 | Bulletin, posted on the State's publicly accessible Internet |
16 | website and reported to the chairman and minority chairman of |
17 | the Appropriations Committee of the Senate and the chairman |
18 | and minority chairman of the Appropriations Committee of the |
19 | House of Representatives. |
20 | (c) Accumulation.--No moneys shall be distributed from the |
21 | Taxpayer Protection Fund pursuant to subsection (b) until such |
22 | time as the Secretary of the Budget certifies that the moneys |
23 | deposited therein are sufficient to provide a reduction of at |
24 | least 0.01% in the tax rate of taxation for the tax imposed |
25 | under Article III of the Tax Reform Code of 1971. |
26 | (d) Appropriated funds.--The General Assembly may at any |
27 | time provide additional amounts from any funds available to the |
28 | Commonwealth as an appropriation to the Budget Stabilization |
29 | Reserve Fund. |
30 | Section 5. Repeals. |
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1 | Repeals are as follows: |
2 | (1) The General Assembly declares that the repeal under |
3 | paragraph (2) is necessary to effectuate the provisions of |
4 | this act. |
5 | (2) Section 1702-A of the act of April 9, 1929 (P.L.343, |
6 | No.176), known as The Fiscal Code, is repealed. |
7 | Section 6. Effective date. |
8 | This act shall take effect immediately. |
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