HOUSE AMENDED
PRIOR PRINTER'S NOS. 606, 853, 963, PRINTER'S NO. 1501
1026, 1038
No. 10 Session of 2003
INTRODUCED BY BRIGHTBILL, JUBELIRER, PICCOLA, WENGER, THOMPSON,
EARLL, ROBBINS, M. WHITE, KUKOVICH, WONDERLING, D. WHITE,
PILEGGI, CONTI, MADIGAN, COSTA, DENT, LEMMOND, RHOADES,
ARMSTRONG, RAFFERTY AND PUNT, MARCH 28, 2003
AS RE-REPORTED FROM COMMITTEE ON APPROPRIATIONS, HOUSE OF
REPRESENTATIVES, AS AMENDED, MARCH 30, 2004
AN ACT
1 Amending Titles 12 (Commerce and Trade) and 72 (Taxation and <--
2 Fiscal Affairs) of the Pennsylvania Consolidated Statutes,
3 codifying portions of the Economic Development Financing Law
4 and further providing for contract requirements and for
5 Commonwealth obligations; codifying portions of the Job
6 Enhancement Act and further providing for contract
7 requirements, for guidelines, for administration and for
8 application and review requirements; codifying portions of
9 the Keystone Opportunity Zone and Keystone Opportunity
10 Expansion Zone Act and further providing for keystone
11 opportunity expansion subzones and for keystone opportunity
12 improvement zones; providing for the Project Review
13 Committee, for Keystone Innovation Zones, for the Economic
14 Enhancement Program, for the Economic Enhancement Financing
15 Program, for the Core Industries Infrastructure
16 Capitalization Program, for the Water and Wastewater
17 Infrastructure Capitalization Program, for the First
18 Industries Program, for the Secondary Growth Stage Financing
19 Program, for primary growth stage investment providing for
20 the Economic Enhancement Fund; codifying the Capital
21 Facilities Debt Enabling Act; further providing for
22 definitions, for procedures for capital budget and debt
23 authorizing legislation, for bonds, for appropriations for
24 and limitations on redevelopment assistance and site
25 development capital projects, and for funding and
26 administration of redevelopment assistance capital projects;
27 providing for funding and administration of site development
28 capital projects and for the Capital Project Oversight and
29 Review Committee; continuing debt authorization; making
1 repeals; requiring a referendum; and making appropriations.
2 AMENDING TITLE 12 (COMMERCE AND TRADE) OF THE PENNSYLVANIA <--
3 CONSOLIDATED STATUTES, PROVIDING FOR THE INFRASTRUCTURE AND
4 FACILITIES IMPROVEMENT PROGRAM; AND MAKING A RELATED REPEAL.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. The General Assembly finds and declares as <--
8 follows:
9 (1) An economic stimulus program which provides direct
10 immediate economic assistance to Pennsylvania businesses and
11 industries is needed to preserve and to create jobs within
12 this Commonwealth.
13 (2) By targeting grant and loan assistance to
14 Pennsylvania businesses and industries for job creation,
15 health care safety and industrial and commercial site
16 development, the Commonwealth will trigger the needed
17 redevelopment and economic growth of industrial and
18 commercial activities conducted within this Commonwealth.
19 (3) By targeting grant and loan assistance to
20 Pennsylvania communities for water and wastewater
21 infrastructure projects, the Commonwealth will trigger the
22 redevelopment of existing brownfield sites and improve the
23 environment and health of all residents of this Commonwealth.
24 (4) By expanding tax-based financing of economic
25 development projects, the Commonwealth will assist local
26 governments in retaining employers of and recruiting
27 employers to this Commonwealth.
28 (5) By targeting loan assistance to the tourism and
29 agriculture sectors of the Commonwealth's economy, the
30 Commonwealth will provide additional financial support to
31 those leading Commonwealth industries hard hit by world
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1 events and economic instability.
2 (6) By targeting capital investment and subsidized loan
3 assistance to emerging business, the Commonwealth will
4 stimulate the growth and increase the stability of small
5 businesses within this Commonwealth.
6 (7) By preparing the Commonwealth to face the Federal
7 Base Realignment and Closure (BRAC) process, the Commonwealth
8 will increase the number of existing jobs it retains during
9 the next round of Federal base realignment and closures.
10 Section 1.1. Title 12 of the Pennsylvania Consolidated
11 Statutes is amended by adding parts to read:
12 PART I
13 GENERAL PROVISIONS
14 Chapter
15 1. (Reserved)
16 3. Economic Development Financing Strategy
17 5. Small Business Council
18 7. Tax-Exempt Bond Allocation (Reserved)
19 CHAPTER 1
20 (RESERVED)
21 CHAPTER 3
22 ECONOMIC DEVELOPMENT FINANCING STRATEGY
23 Sec.
24 301. Scope.
25 302. Definitions.
26 303. Development.
27 304. Oversight.
28 § 301. Scope.
29 This chapter relates to the development of an annual economic
30 development financing strategy.
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1 § 302. Definitions.
2 The following words and phrases when used in this chapter
3 shall have the meanings given to them in this section unless the
4 context clearly indicates otherwise:
5 "Department." The Department of Community and Economic
6 Development of the Commonwealth.
7 "Economic development program." A program which is
8 administered by and which provides financial assistance for
9 economic development to persons or a program of a public entity
10 which provides financial assistance for economic development to
11 persons in coordination with the Department of Community and
12 Economic Development. The term includes all of the following:
13 (1) Any program created under Part III (relating to
14 economic development programs).
15 (2) Any program of an entity created under Part IV
16 (relating to economic development financing).
17 (3) The Pennsylvania Industrial Development Authority.
18 (4) The Pennsylvania Minority Business Development
19 Authority.
20 (5) The Infrastructure Development Program.
21 (6) The Industrial Sites Reuse Program.
22 (7) The tax credit programs established in Articles
23 XVII-B and XVIII-B of the act of March 4, 1971 (P.L.6, No.2),
24 known as the Tax Reform Code of 1971.
25 § 303. Development.
26 The department shall annually develop a report containing a
27 financing strategy for economic development within this
28 Commonwealth. In developing the report, the department shall
29 gather input and recommendations from businesses, community
30 leaders and organizations, legislators and private citizens. The
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1 report shall include all of the following:
2 (1) A financial audit or statement of operations for
3 each economic development program.
4 (2) A narrative description of accomplishments for each
5 economic development program during the preceding fiscal
6 year.
7 (3) A detailed description of the parameters of
8 operation for the economic development programs during the
9 upcoming fiscal year. The description shall include the terms
10 and conditions under which the economic development programs
11 shall be administered.
12 (4) A description of the performance measurements and
13 accountability factors to be applied and the performance
14 targets or goals to be met for each economic development
15 program.
16 (5) A description of long-range planning for the
17 economic development programs through the next five fiscal
18 years.
19 (6) A list of the loans, grants or credits approved by
20 the economic development programs during the fiscal year. The
21 list shall include a brief description of and details
22 regarding each loan, grant or credit approved.
23 (7) A review of pending projects.
24 § 304. Oversight.
25 Concurrent with the submission of the Governor's annual
26 budget message, the department shall submit the report required
27 by this chapter to all of the following:
28 (1) The Secretary of the Senate.
29 (2) The chairperson of the Appropriations Committee of
30 the Senate.
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1 (3) The Chief Clerk of the House of Representatives.
2 (4) The chairperson of the Appropriations Committee of
3 the House of Representatives.
4 CHAPTER 5
5 SMALL BUSINESS COUNCIL
6 Sec.
7 501. Scope.
8 502. Definitions.
9 503. Small Business Council.
10 504. Regulatory review.
11 § 501. Scope.
12 This chapter relates to the Small Business Council.
13 § 502. Definitions.
14 The following words and phrases when used in this chapter
15 shall have the meanings given to them in this section unless the
16 context clearly indicates otherwise:
17 "Council." The Small Business Council established under
18 section 503 (relating to Small Business Council).
19 "Department." The Department of Community and Economic
20 Development of the Commonwealth.
21 "Executive agency." The Governor and the departments,
22 boards, commissions, authorities and other officers and agencies
23 of the Commonwealth. The term does not include any court or
24 other officer or agency of the unified judicial system, the
25 General Assembly and its officers and agencies or any
26 independent agency or State-affiliated entity.
27 "Secretary." The Secretary of Community and Economic
28 Development of the Commonwealth.
29 "Small business." A person that employs fewer than 100
30 employees.
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1 § 503. Small Business Council.
2 (a) Establishment.--There is established within the
3 department an agency to be known as the Small Business Council.
4 The council shall do all of the following:
5 (1) Assist with the development of policies and
6 regulations which affect small businesses within this
7 Commonwealth.
8 (2) Provide advice relating to the nature of small
9 business practices and problems in this Commonwealth.
10 (3) Provide a review of existing and proposed policies
11 and regulations which are relevant to small business.
12 (b) Composition.--The council shall be composed of 13
13 members. The secretary shall serve ex officio. Twelve members
14 shall be appointed as follows:
15 (1) Four individuals appointed by the Governor.
16 (2) Two individuals appointed by the President pro
17 tempore of the Senate.
18 (3) Two individuals appointed by the Minority Leader of
19 the Senate.
20 (4) Two individuals appointed by the Speaker of the
21 House of Representatives.
22 (5) Two individuals appointed by the Minority Leader of
23 the House of Representatives.
24 (c) Qualifications.--In order to be eligible for appointment
25 to the council, an individual must:
26 (1) have a background in improving small businesses; and
27 (2) be one of the following:
28 (i) a present owner or operator of a small business
29 within this Commonwealth;
30 (ii) a member of the academic community who has
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1 expertise regarding small business practices; or
2 (iii) a professional who specializes in representing
3 small businesses.
4 (d) Term.--Each member of the council shall serve for a
5 period of two years.
6 (e) Organization.--The secretary shall serve as chairperson.
7 The members of the council shall elect from among themselves a
8 vice chairperson, secretary, treasurer and such other officers
9 as they may determine.
10 (f) Meetings.--The council shall meet at the call of the
11 chairperson but shall meet at least once each quarter.
12 (g) Quorum.--A majority of the board shall constitute a
13 quorum. A majority of the members present shall be necessary to
14 transact business on behalf of the council.
15 (h) Expenses.--A member shall not receive compensation or
16 remuneration, but shall be entitled to reimbursement for all
17 reasonable and necessary actual expenses.
18 (i) Administrative assistance.--The department shall do all
19 of the following:
20 (1) Provide administrative and technical support to the
21 council.
22 (2) Publish notice of council meetings in accordance
23 with 65 Pa.C.S. Ch.7 (relating to open meetings).
24 (3) Maintain a mailing list of persons who have
25 requested specific notification of meetings and activities of
26 the council.
27 (4) Designate a deputy secretary to attend council
28 meetings and to serve as the public's liaison of the council.
29 (j) Cooperation.--Upon the council's request, an executive
30 agency shall provide the council with officially promulgated
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1 regulatory and nonregulatory documents which regulate or would
2 regulate small businesses.
3 § 504. Regulatory review.
4 (a) Notification.--To the extent known to the secretary, the
5 department shall, on a semiannual basis, provide the council
6 with a list of regulations being proposed by all executive
7 agencies which may affect small businesses in this Commonwealth.
8 (b) Conference.--The department shall, upon request of the
9 council, arrange a meeting between the council and
10 representatives of an executive agency to discuss regulatory
11 proposals and policy initiatives of the executive agency which
12 might affect small businesses in this Commonwealth.
13 (c) Written comments.--The council shall provide the
14 department with written comments regarding the council's
15 position on the proposed regulations. The department shall
16 transmit the comments to the appropriate executive agencies. The
17 written comments shall include an impact statement and any other
18 information which the council deems necessary for the public to
19 make an informed opinion on the proposals.
20 (d) Exceptions.--The requirements under subsections (a) and
21 (b) shall not apply to the promulgation of the following
22 regulations relating to small businesses:
23 (1) Regulations required by court order.
24 (2) Regulations necessitated by a Federal or State
25 declaration of emergency.
26 (3) Interim regulations which are authorized by statute.
27 CHAPTER 7
28 TAX-EXEMPT BOND ALLOCATION
29 (RESERVED)
30 PART II
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1 ECONOMIC DEVELOPMENT ENTITIES
2 Chapter
3 11. Ben Franklin (Reserved)
4 13. Industrial Resource Centers (Reserved)
5 15. (Reserved)
6 17. (Reserved)
7 19. (Reserved)
8 CHAPTER 11
9 BEN FRANKLIN
10 (RESERVED)
11 CHAPTER 13
12 INDUSTRIAL RESOURCE CENTERS
13 (RESERVED)
14 CHAPTER 15
15 (RESERVED)
16 CHAPTER 17
17 (RESERVED)
18 CHAPTER 19
19 (RESERVED)
20 PART III
21 ECONOMIC DEVELOPMENT PROGRAMS
22 Chapter
23 21. Opportunity Grants
24 23. Small Business First
25 25. Industrial Development Assistance (Reserved)
26 27. Customized Job Training (Reserved)
27 29. Machinery and Equipment (Reserved)
28 31. Family Savings Account (Reserved)
29 33. Economic Enhancement
30 35. Keystone Economic Development Zones
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1 37. Keystone Innovation Zones
2 CHAPTER 21
3 OPPORTUNITY GRANTS
4 Sec.
5 2101. Scope.
6 2102. Definitions.
7 2103. Establishment.
8 2104. Application.
9 2105. Review.
10 2106. Approval.
11 2107. Penalty.
12 2108. Limitations.
13 2109. Guidelines.
14 § 2101. Scope.
15 This chapter relates to the Opportunity Grant Program.
16 § 2102. Definitions.
17 The following words and phrases when used in this chapter
18 shall have the meanings given to them in this section unless the
19 context clearly indicates otherwise:
20 "Applicant." A person that applies for a grant in accordance
21 with this chapter.
22 "Department." The Department of Community and Economic
23 Development of the Commonwealth.
24 "Developer." A person that has as a purpose the promotion or
25 construction of economic development projects and that is
26 engaged in the development of real estate for use by more than
27 one person.
28 "Eligible recipient." Any of the following persons:
29 (1) A municipality.
30 (2) An entity created under the act of August 23, 1967
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1 (P.L.251, No.102), known as the Economic Development
2 Financing Law.
3 (3) An entity certified as an industrial development
4 agency under the act of May 17, 1956 (1955 P.L.1609, No.537),
5 known as the Pennsylvania Industrial Development Authority
6 Act.
7 (4) An entity created under 53 Pa.C.S. Ch.56 (relating
8 to municipal authorities) or under the former act of May 2,
9 1945 (P.L.382, No.164), known as the Municipality Authorities
10 Act of 1945.
11 (5) An entity created under the act of May 24, 1945
12 (P.L.991, No.385), known as the Urban Redevelopment Law.
13 (6) A developer.
14 (7) A person that is engaged in any of the following
15 activities:
16 (i) The production or processing of farm
17 commodities.
18 (ii) Manufacturing.
19 (iii) Research and development.
20 (iv) Export services.
21 (v) Any other activity which offers a significant
22 economic impact on the Commonwealth, as determined by the
23 department.
24 "Eligible use." Any of the following activities:
25 (1) Job training.
26 (2) The acquisition of land, buildings or rights-of-way.
27 (3) The construction or rehabilitation of buildings.
28 (4) The construction or rehabilitation of
29 infrastructure.
30 (5) The purchase or upgrading of machinery and
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1 equipment.
2 (6) Working capital.
3 (7) Site preparation, including demolition and
4 clearance.
5 (8) Environmental assessments.
6 (9) Remediation of hazardous material.
7 (10) Architectural and engineering fees up to 10% of the
8 award.
9 "Job-creating economic development." Includes the expansion
10 or preservation of existing industry.
11 "Program." The Opportunity Grant Program established in
12 section 2103 (relating to establishment.)
13 "Project." An activity conducted in this Commonwealth.
14 "Recipient." A person who receives a grant under this
15 chapter.
16 § 2103. Establishment.
17 There is established within the department a program to be
18 known as the Opportunity Grant Program. The program shall be
19 administered by the department to provide grants to eligible
20 persons for certain projects which encourage job-creating
21 economic development within this Commonwealth.
22 § 2104. Application.
23 A person may submit an application to the department
24 requesting a grant for a project. The application shall be on
25 the form required by the department and shall include or
26 demonstrate all of the following:
27 (1) The name and address of the applicant.
28 (2) A statement that the applicant is an eligible
29 recipient under the program.
30 (3) A statement of the amount of grant sought.
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1 (4) A statement of the project, including a detailed
2 statement of the cost of the project.
3 (5) A statement identifying the economic impact of the
4 project to the region and the estimated impact on State and
5 local revenues.
6 (6) A firm financial commitment from a responsible
7 source for at least 80% of the cost of the project.
8 (7) A firm commitment from the applicant to complete the
9 project.
10 (8) Any other information required by the department.
11 § 2105. Review.
12 The department shall review the application to determine all
13 of the following:
14 (1) If the applicant is an eligible recipient under the
15 program.
16 (2) If the project is an eligible use of grant proceeds
17 under the program.
18 (3) If a financial commitment exists for at least 80% of
19 the cost of the project.
20 (4) If the financial commitment from the source is firm.
21 (5) If the source of the financial commitment is
22 responsible.
23 (6) If the applicant complied with all other criteria
24 established by the department.
25 § 2106. Approval.
26 The following shall apply:
27 (1) Upon being satisfied that all requirements have been
28 met, the department may approve the application and award a
29 grant. Grants shall be awarded in a manner which maximizes
30 geographic diversity.
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1 (2) Prior to providing grant funds to the applicant, the
2 department shall enter into a contract with the applicant.
3 The contract shall include provisions requiring the applicant
4 to do all of the following:
5 (i) Use the grant to pay the costs of the project.
6 (ii) Repay the grant from any proceeds resulting
7 from a sale or partial sale of the project by the
8 applicant in accordance with the following:
9 (A) If the project is sold less than two years
10 after receipt of the grant, the applicant shall repay
11 the Commonwealth 90% of the grant received.
12 (B) If the project is sold more than two years
13 but less than four years after receipt of the grant,
14 the applicant shall repay the Commonwealth 80% of the
15 grant received.
16 (C) If the project is sold more than four years
17 but less than six years after receipt of the grant,
18 the applicant shall repay the Commonwealth 70% of the
19 grant received.
20 (D) If the project is sold more than six years
21 but less than eight years after receipt of the grant,
22 the applicant shall repay the Commonwealth 60% of the
23 grant received.
24 (E) If the project is sold more than eight years
25 but less than ten years after receipt of the grant,
26 the applicant shall repay the Commonwealth 50% of the
27 grant received.
28 (3) The department may impose any other terms and
29 conditions on the grants authorized by this chapter as the
30 department determines is in the best interests of the
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1 Commonwealth, including a provision requiring collateral for
2 any penalty imposed under the program.
3 § 2107. Penalty.
4 (a) Imposition.--Except as provided in subsection (b), the
5 department shall impose a penalty upon a recipient for any of
6 the following:
7 (1) Failing to create the number of jobs specified in
8 the recipients application.
9 (2) Failing to inject the required amount of private
10 matching funds into the project.
11 (b) Exception.--The department may waive the penalty
12 required by subsection (a) if the department determines that the
13 failure was due to circumstances outside the control of the
14 recipient.
15 (c) Amount.--The amount of the penalty shall be equal to the
16 full amount of the grant received plus an additional amount of
17 up to 10% of the amount of the grant received. The penalty shall
18 be payable in one lump sum or in installments, with or without
19 interest, as the department deems appropriate.
20 § 2108. Limitations.
21 (1) An applicant may not receive a grant under this
22 chapter for more than two consecutive fiscal years for the
23 same project.
24 (2) A grant awarded under this chapter may not be used
25 to do any of the following:
26 (i) Refinance or retire existing debt.
27 (ii) Pay cost unrelated to a project location at a
28 site in this Commonwealth.
29 (3) In no case shall the aggregate amount of grants paid
30 in any fiscal year under this chapter exceed the annual
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1 appropriation to the department for the program.
2 (4) A grant awarded under this chapter shall in no way
3 constitute an entitlement derived from the Commonwealth or a
4 claim on any other funds of the Commonwealth.
5 § 2109. Guidelines.
6 (a) Development.--The department shall develop written
7 guidelines for the program. The guidelines shall do all of the
8 following:
9 (1) Limit grant size for any single project.
10 (2) Clarify eligible uses of grants.
11 (3) Clarify standards for eligibility.
12 (b) Use.--No projects may be approved until the written
13 guidelines have been completed and copies of the guidelines have
14 been submitted to the General Assembly.
15 CHAPTER 23
16 SMALL BUSINESS FIRST
17 Sec.
18 2301. Scope.
19 2302. Definitions.
20 2303. Establishment.
21 2304. Fund and accounts.
22 2305. Department responsibilities.
23 2306. Capital development loans.
24 2307. EDA loans.
25 2308. Loans in distressed communities.
26 2309. Pollution prevention assistance loans.
27 2310. Export financing loans.
28 2311. Reporting and inspection.
29 2312. Limitations.
30 § 2301. Scope.
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1 This chapter relates to the Small Business First Program.
2 § 2302. Definitions.
3 The following words and phrases when used in this chapter
4 shall have the meanings given to them in this section unless the
5 context clearly indicates otherwise:
6 "Agricultural producer." A person involved in the management
7 and use of a normal agricultural operation for the production of
8 a farm commodity.
9 "Apparel products." Products manufactured, woven, cut, sewn
10 or otherwise similarly processed by mechanical or human effort
11 from fabrics, leather or cloth and made for use as clothing,
12 shoes or other attire.
13 "Applicant." A person that applies for a loan in accordance
14 with this chapter.
15 "Area loan organization." A local development district, an
16 industrial development agency organized and existing under the
17 act of May 17, 1956 (1955 P.L.1609, No.537), known as the
18 Pennsylvania Industrial Development Authority Act, or any other
19 nonprofit economic development organization certified by the
20 Department of Community and Economic Development as possessing
21 the qualifications necessary to evaluate and administer loans
22 made under this chapter.
23 "Capital development project." Land, buildings, equipment
24 and machinery and working capital which is acquired,
25 constructed, renovated or used by a small business in accordance
26 with any of the following:
27 (1) As part of a for-profit project or venture not of a
28 mercantile or service-related nature, except for hospitality
29 industry projects.
30 (2) As part of an effort to:
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1 (i) bring a small business into compliance with
2 Federal or State environmental laws or regulations;
3 (ii) complete an approved remediation project; or
4 (iii) permit a small business to adopt generally
5 acceptable pollution prevention practices.
6 (3) As part of an effort to provide assistance to a
7 small business that is a recycler of municipal or commercial
8 waste or that is a manufacturer using recycled municipal or
9 commercial waste materials.
10 (4) As part of an effort to assist a small business with
11 defense conversion activities.
12 (5) As part of a for-profit project or venture to
13 manufacture products to be exported out of the United States
14 by a small business which is not of a mercantile or service-
15 related nature, except for export-related services and
16 international export-related mercantile ventures or advanced
17 technology and computer-related services and mercantile
18 ventures and which will increase this Commonwealth's national
19 or international market shares.
20 (6) As part of a for-profit project or venture that
21 meets the requirements of section 2308 (relating to loans in
22 distressed communities)
23 (7) As part of an effort to assist in the start-up or
24 expansion of a for-profit or not-for-profit child day-care
25 center subject to licensure by the Commonwealth.
26 "Child day-care center." Any premises in which child day
27 care is provided simultaneously for seven or more children who
28 are not related to the provider.
29 "Community development institution." Any of the following:
30 (1) An area loan organization for a distressed
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1 community.
2 (2) A community development financial institution
3 located in a distressed community and approved by the
4 Department of Community and Economic Development.
5 "Department." The Department of Community and Economic
6 Development of the Commonwealth.
7 "Distressed community." A community which has any of the
8 following:
9 (1) A census tract or other specifically defined
10 geographic area in which there is any of the following:
11 (i) A median income below 80% of the median income
12 for the United States or this Commonwealth.
13 (ii) Twenty percent or more of the population is
14 below the poverty level by family size published by the
15 Bureau of the Census.
16 (iii) An unemployment rate 50% higher than the
17 national average.
18 (2) An area which is designated a subzone, expansion
19 subzone, or improvement subzone under the act of October 6,
20 1998 (P.L.705, No.92), known as the Keystone Opportunity Zone
21 and Keystone Opportunity Expansion Zone Act.
22 (3) Any other geographic area designated by the
23 Department of Community and Economic Development as
24 distressed. The designation shall be published in the
25 Pennsylvania Bulletin.
26 "EDA loan." A loan made under this chapter utilizing funds
27 made available to the department under the Public Works and
28 Economic Development Act of 1965 (Public Law 89-136, 42 U.S.C. §
29 3121 et seq.).
30 "Ex-Im Bank." The Export-Import Bank of the United States.
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1 "Export activity." An activity undertaken by a person within
2 this Commonwealth related to exports.
3 "Export business." A person that is engaged in a for-profit
4 enterprise involving export activities and that employs 250 or
5 fewer individuals.
6 "Exports." Goods and services to be sold outside the United
7 States.
8 "Farm commodity." Any Pennsylvania-grown agricultural,
9 horticultural, aquacultural, vegetable, fruit and floricultural
10 product of the soil, livestock and meats, wools, hides, furs,
11 poultry, eggs, dairy products, nuts, mushrooms, honey products
12 and forest products.
13 "Fund." The Small Business First Fund continued under
14 section 2304 (relating to fund and accounts).
15 "Hazardous substance." Any element, compound or material
16 which is any of the following:
17 (1) Regulated as a hazardous air pollutant under section
18 6.6 of the act of January 8, 1960 (1959 P.L.2119, No.787),
19 known as the Air Pollution Control Act.
20 (2) Defined as a hazardous waste under section 103 of
21 the act of July 7, 1980 (P.L.380, No.97), known as the Solid
22 Waste Management Act.
23 (3) Regulated under the act of December 7, 1990
24 (P.L.639, No.165), known as the Hazardous Material Emergency
25 Planning and Response Act.
26 "Hospitality industry project." A for-profit project or
27 venture which involves a small business that operates a hotel,
28 motel or other lodging facility and that employs at least five
29 full-time equivalent employees at the time an application is
30 submitted to the Department of Community and Economic
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1 Development for financing. The term includes a for-profit
2 project or venture which involves a small business that operates
3 a restaurant or food service operation open to the public, that
4 has been in continuous operation for at least five years and
5 that employs at least five full-time equivalent employees at the
6 time an application is submitted.
7 "Insurance policy." An export credit insurance policy for
8 small businesses offered by the Export-Import Bank of the United
9 States.
10 "Natural disaster." As defined in 35 Pa.C.S. § 7102
11 (relating to definitions).
12 "Normal agricultural operation." As defined in section 2 of
13 the act of June 10, 1982 (P.L.454, No.133), entitled "An act
14 protecting agricultural operations from nuisance suits and
15 ordinances under certain circumstances.
16 "Pollution prevention." The reduction or elimination of
17 pollution at its source. The term does not include any of the
18 following:
19 (1) A substitution of one hazardous or toxic substance
20 for another which will cause an increased risk to the
21 environment or to human health.
22 (2) A cross-media transfer.
23 (3) A delisting of a hazardous waste or toxic chemical.
24 "Pollution prevention assistance agency." Any of the
25 following:
26 (1) An area loan organization.
27 (2) An industrial resource center created pursuant to
28 the act of June 22, 2001 (P.L.400, No.31), known as the
29 Industrial Resources Center Partnership Act.
30 "Pollution prevention infrastructure." A capital development
20030S0010B1501 - 22 -
1 project which permits a small business to adopt or install
2 pollution prevention equipment or processes to:
3 (1) Reduce or reuse raw materials onsite.
4 (2) Reduce the production of waste.
5 (3) Reduce energy consumption.
6 "Program." The Small Business First Program established
7 under section 2303 (relating to establishment).
8 "Reuse." Use of a product or component in its original form
9 more than once.
10 "Small business." A person that is engaged in a for-profit
11 enterprise and that employs 100 or fewer individuals. The term
12 includes the following:
13 (1) An enterprise located in a small business incubator
14 facility.
15 (2) An agricultural processor.
16 (3) An agricultural producer.
17 (4) An enterprise which manufactures apparel products.
18 (5) An enterprise which is a for-profit or not-for-
19 profit child day-care center subject to licensure by the
20 Commonwealth.
21 "Working capital." Capital used by a small business for
22 operations, excluding fixed assets and production machinery and
23 equipment.
24 § 2303. Establishment.
25 There is established within the department a program to be
26 known as the Small Business First Program. The program shall be
27 administered by the department and provide loans to eligible
28 persons for certain projects which encourage job creating and
29 job preserving economic development within this Commonwealth.
30 § 2304. Fund and accounts.
20030S0010B1501 - 23 -
1 (a) Fund.--The Small Business First Fund, created under
2 section 1302(a) of the act of June 29, 1996 (P.L.434, No.67),
3 known as the Job Enhancement Act, is continued. The Treasury
4 Department shall credit the following to the fund:
5 (1) Appropriations made by the General Assembly to the
6 department for the program.
7 (2) Federal funds made available under the Public Works
8 and Economic Development Act of 1965 (Public Law 89-136, 42
9 U.S.C. § 3121 et seq.), or any other Federal statute,
10 regulation or program for the program.
11 (3) Payments from recipients of loans made from the
12 fund.
13 (4) Payments from recipients of loans made under the
14 former act of July 2, 1984 (P.L.545, No.109), known as the
15 Capital Loan Fund Act.
16 (5) Interest income derived from investment of the money
17 in the fund.
18 (6) Any other deposits, payments or contributions from
19 any other source made available to the department for the
20 program.
21 (b) Pollution prevention assistance.--The Pollution
22 Prevention Assistance Account, created under the act of June 29,
23 1996 (P.L.434, No.67), known as the Job Enhancement Act, is
24 continued. The Treasury Department shall credit the following to
25 this account:
26 (1) Appropriations made by the General Assembly to the
27 department for pollution prevention assistance.
28 (2) Payments from recipients of loans made from the
29 Pollution Prevention Assistance Account.
30 (3) Transfers from the Hazardous Sites Cleanup Fund as
20030S0010B1501 - 24 -
1 established in section 602.3 of the act of March 4, 1971
2 (P.L.6, No.2), known as the Tax Reform Code of 1971.
3 (4) Interest income derived from investment of the money
4 in the Pollution Prevention Assistance Account.
5 (5) Any other deposits, payments or contributions from
6 any other source made available to the department for
7 pollution prevention assistance.
8 (c) Export financing.--There is created within the fund an
9 account to be known as the Export Financing Assistance Account.
10 The Treasury Department shall credit the following to this
11 account:
12 (1) Appropriations made by the General Assembly to the
13 department for export financing assistance.
14 (2) Payments from recipients of loans made from the
15 Export Financing Assistance Account.
16 (3) Interest income derived from investment of the money
17 in the Export Financing Assistance Account.
18 (4) Any other deposits, payments or contributions from
19 any other source made available to the department for export
20 financing assistance.
21 (d) Use of fund.--Money in the fund may be used as follows:
22 (1) By the department to make loans in accordance with
23 this chapter and for administrative costs of the department
24 in administering the program.
25 (2) By area loan organizations for administrative costs
26 associated with the program which are approved by the
27 department.
28 (e) Use of Pollution Prevention Assistance Account.--Money
29 in the Pollution Prevention Assistance Account may be used by
30 the department to provide loans to small businesses for the
20030S0010B1501 - 25 -
1 adoption or installation of pollution-prevention or energy-
2 efficient equipment or processes in accordance with section 2309
3 (relating to pollution prevention assistance loans).
4 (f) Use of Export Financing Assistance Account.--Money in
5 the Export Financing Assistance Account may be used by the
6 department to provide loans to export businesses for export
7 activities in accordance with section 2310 (relating to export
8 financing loans).
9 § 2305. Department responsibilities.
10 (a) General rule.--The department shall do all of the
11 following:
12 (1) Administer the program.
13 (2) Establish written guidelines as necessary. Any
14 guidelines established shall be included in the report
15 required by Chapter 3 (relating to economic development
16 financing strategy).
17 (3) Deposit payments made by recipients in the fund, the
18 Pollution Prevention Assistance Account or Export Financing
19 Assistance Account, as appropriate.
20 (4) Approve standards for area loan organization
21 application fees.
22 (5) Approve community development financial
23 institutions.
24 (b) Program.--In administering the program, the department
25 may do any of the following:
26 (1) Provide grants or other financial assistance to area
27 loan organizations for any of the following purposes:
28 (i) To establish loan reserve funds.
29 (ii) To reimburse loan losses to commercial banks
30 and other financial institutions as a means of
20030S0010B1501 - 26 -
1 encouraging the expansion and financing of small
2 businesses.
3 (2) Apply to the Ex-Im Bank for delegated authority
4 lender status under the Ex-Im Bank's Working Capital Guaranty
5 Program.
6 (3) Utilize the outstanding portfolio of loans made
7 under this chapter to raise additional funds by selling,
8 securing, hypothecating or otherwise using such loan proceeds
9 as a financing vehicle if the funds raised are used by the
10 department for either of the following purposes:
11 (i) To make new and additional loans under this
12 chapter.
13 (ii) To pay costs associated with financing.
14 § 2306. Capital development loans.
15 (a) Application.--A small business may submit an application
16 and any applicable application fee to its area loan organization
17 requesting a loan for certain costs of a capital development
18 project. The application shall be on the form required by the
19 department and shall include or demonstrate all of the
20 following:
21 (1) The name and address of the applicant.
22 (2) A statement of the amount of loan assistance sought.
23 (3) A statement of the capital development project
24 including a detailed statement of the cost of the project.
25 (4) A firm financial commitment from a responsible
26 source for any cost of the capital development project in
27 excess of the amount requested.
28 (5) Any other information required by the department.
29 (b) Area loan organization review.--
30 (1) Upon receipt of a completed application, an area
20030S0010B1501 - 27 -
1 loan organization shall investigate and determine all of the
2 following:
3 (i) If the applicant is a small business.
4 (ii) If the project is a capital development
5 project.
6 (iii) If, when the applicant is a small business,
7 the capital development project demonstrates a
8 substantial likelihood of creating or preserving
9 employment activities in this Commonwealth or if, when
10 the applicant is an agriculture producer, the project
11 demonstrates a substantial likelihood of enhancing and
12 growing normal agriculture operations.
13 (iv) The ability of the applicant to meet and
14 satisfy the debt service as it becomes due and payable.
15 (v) The existence and sufficiency of collateral for
16 the loan. Collateral may include lien positions on
17 nonresidential real property and on personal property.
18 (vi) Relevant criminal and credit history and
19 ratings of the applicant as determined from outside
20 credit reporting services and other sources.
21 (vii) The number of employment opportunities to be
22 created or preserved by the proposed capital development
23 project.
24 (viii) If the applicant complied with all other
25 criteria established by the department.
26 (2) Upon being satisfied that all requirements have been
27 met, the area loan organizations shall recommend the
28 applicant to the department and forward the application with
29 all supporting documentation to the department for its review
30 and approval.
20030S0010B1501 - 28 -
1 (c) Department review.--
2 (1) Within 30 days of receiving a recommendation and
3 application, the department shall review the application. If
4 the department is satisfied that all requirements have been
5 met, the department may approve the loan request in
6 accordance with the following:
7 (i) A loan for land, buildings and machinery and
8 equipment may not exceed $200,000 or 50% of the total
9 capital development project costs, whichever is less.
10 (ii) A loan for working capital may not exceed
11 $100,000 or 50% of the total capital development project
12 costs, whichever is less.
13 (iii) Except for loans to agriculture producers, a
14 loan must create or preserve one job for every $25,000
15 loaned.
16 (2) The department shall notify the area loan
17 organization and applicant of its decision.
18 (d) Approvals.--For applications which are approved, the
19 department shall draw an advance equal to the principal amount
20 of the loan from the fund. The advance shall be forwarded to the
21 area loan organization and, upon receipt by the area loan
22 organization, shall become an obligation of the area loan
23 organization. Prior to providing loan funds to the applicant,
24 the area loan organization shall require the applicant to
25 execute a note and to enter into a loan agreement. In addition
26 to the requirements of subsection (e), the loan agreement shall
27 include a provision requiring the recipient to use the loan
28 proceeds to pay the costs of the capital development project.
29 The department may require the area loan organization to impose
30 other terms and conditions on the recipient if the department
20030S0010B1501 - 29 -
1 determines that they are in the best interests of this
2 Commonwealth, including a provision requiring collateral for any
3 penalty imposed under subsection (g).
4 (e) Loan terms.--A loan agreement entered into in accordance
5 with subsection (c) shall do all of the following:
6 (1) State the collateral securing the loan. All loans
7 shall be secured by lien positions on collateral at the
8 highest level of priority as may be determined by the area
9 loan organization with the approval of the department. The
10 collateral may include nonresidential real estate purchased
11 as part of the capital development project.
12 (2) State the repayment period in accordance with the
13 following:
14 (i) A loan for real property shall have a repayment
15 period of up to 15 years.
16 (ii) A loan for machinery and equipment shall have a
17 repayment period of up to ten years.
18 (iii) A loan for working capital shall have a
19 repayment period of up to three years.
20 (iv) If, in a capital development project, there are
21 two or more uses planned, the loan terms may be blended.
22 (3) State the interest rate in accordance with the
23 following:
24 (i) Except a provided in subparagraph (ii), loans
25 shall be made at an interest rate not to exceed 5% for
26 the term of the loan.
27 (ii) A loan to a small business which is an
28 agricultural producer shall be made at an interest rate
29 of not less than 2% for the term of the loan if all of
30 the following apply:
20030S0010B1501 - 30 -
1 (A) A declaration under 35 Pa.C.S. § 7301(c)
2 (relating to general authority of Governor) is in
3 effect for at least ten days prior to the date of
4 application.
5 (B) The application is made within nine months
6 of termination of the declaration.
7 (C) The agricultural producer is in the area
8 which has been declared to be a natural disaster
9 area.
10 (f) Loan administration.--A loan made under this section
11 shall be administered in accordance with departmental policies
12 and procedures by the area loan organization which made the
13 loan. Each area loan organization shall submit an annual report
14 on the form required by the department and which includes or
15 demonstrates all of the following:
16 (1) Each outstanding loan.
17 (2) The date approved.
18 (3) The original principal amount.
19 (4) The current principal balance.
20 (5) The interest rate.
21 (6) The purpose for which the loan was made.
22 (7) An enumeration of any problems or issues which have
23 arisen with regard to each loan.
24 (8) A statement regarding the progress of the small
25 business in creating or preserving its requisite number of
26 employment opportunities.
27 (9) Any other information or documentation required by
28 the department.
29 (g) Penalty.--
30 (1) Except as provided in paragraph (2), the department
20030S0010B1501 - 31 -
1 shall impose a penalty upon a recipient if the recipient
2 fails to create or preserve the number of employment
3 opportunities specified in its approved application.
4 (2) The department may waive the penalty required by
5 paragraph (1) if the department determines that the failure
6 was due to circumstances outside the control of the
7 recipient.
8 (3) The amount of the penalty imposed under paragraph
9 (1) shall be equal to an increase in the interest rate to 2%
10 greater than the current prime interest rate for the
11 remainder of the loan.
12 (h) Defaults.--The department may by foreclosure take title
13 to a capital development project which it financed if
14 acquisition is necessary to protect a loan made under this
15 section. The department shall pay all costs arising out of the
16 foreclosure and acquisition from moneys held in the fund. The
17 department may, in order to minimize financial losses and
18 sustain employment, lease the capital development project. The
19 department may withdraw moneys from the fund to purchase first
20 mortgages and to make payments on first mortgages on any capital
21 development project which it financed where purchase or payment
22 is necessary to protect a loan made under this section. The
23 department may sell, transfer, convey and assign the first
24 mortgages and shall deposit any moneys derived from the sale of
25 any first mortgages in the fund.
26 § 2307. EDA loans.
27 (a) Application and administration procedures.--The
28 department shall establish application and administration
29 procedures to be used for EDA loans. The procedures shall be
30 established by guidelines and shall conform in all respects to
20030S0010B1501 - 32 -
1 those procedures required or established by the Economic
2 Development Administration for use of Federal funds under the
3 Public Works and Economic Development Act of 1965 (Public Law
4 89-136, 42 U.S.C. § 3121 et seq.).
5 (b) Eligibility for EDA loans.--The department shall
6 establish eligibility requirements to be used for EDA loans. The
7 requirements shall be established by guidelines and shall
8 conform in all respects to those procedures required or
9 established by the Economic Development Administration for use
10 of Federal funds under the Public Works and Economic Development
11 Act of 1965.
12 § 2308. Loans in distressed communities.
13 (a) Application.--A small business located in a distressed
14 community may submit an application and any applicable
15 application fee to a community development institution
16 requesting a loan for certain costs of a capital development
17 project. The application shall be on the form required by the
18 department and shall include or demonstrate all of the
19 following:
20 (1) The name and address of the applicant.
21 (2) A statement that the small business is engaged in
22 business-to-public service or in the mercantile, commercial
23 or point-of-sale retail business sectors.
24 (3) A statement of the amount of loan assistance sought.
25 (4) A statement of the capital development project,
26 including a detailed statement of the cost of the project.
27 (5) A firm financial commitment from a responsible
28 source for the cost of the capital development project in
29 excess of the amount requested.
30 (6) Any other information required by the department.
20030S0010B1501 - 33 -
1 (b) Community development institution review.--
2 (1) Upon receipt of a completed application, a community
3 development institution shall investigate and determine all
4 of the following:
5 (i) If the applicant is a small business which is
6 engaged business-to-public service or in the mercantile,
7 commercial or point-of-sale retail business sectors in
8 accordance with conditions or criteria established by the
9 department.
10 (ii) If the project is a capital development
11 project.
12 (iii) If the applicant has demonstrated a direct
13 impact on the community in which the capital development
14 project is or will be located, on residents of that
15 community or on the local and/or regional economy. The
16 department shall establish criteria that will assist in
17 making this demonstration.
18 (iv) The ability of the applicant to meet and
19 satisfy the debt service as it becomes due and payable.
20 In reviewing repayment obligations, loans shall not be
21 approved on the basis of direct financial return on
22 investment and shall not be held to the loan loss
23 standards of private commercial lenders. Loans shall
24 review for the purpose of establishing a strong economic
25 base and promoting entrepreneurial activity within the
26 distressed community.
27 (v) The existence and sufficiency of collateral for
28 the loan. Collateral may include lien positions on
29 nonresidential real property and on personal property.
30 (vi) Relevant criminal and credit history and
20030S0010B1501 - 34 -
1 ratings of the applicant as determined from outside
2 credit reporting services and other sources.
3 (vii) Number of employment opportunities to be
4 created or preserved by the proposed capital development
5 project.
6 (viii) If the applicant complied with all other
7 criteria established by the department.
8 (2) Upon being satisfied that all requirements have been
9 met, the community development institution shall recommend
10 the applicant to the department and forward the application
11 with all supporting documentation to the department for its
12 review and approval.
13 (c) Department review.--
14 (1) Within 30 days of receiving a recommendation and
15 application, the department shall review the application. If
16 the department is satisfied that all requirements have been
17 met, the department may approve the loan request in
18 accordance with the following:
19 (i) A loan for land, buildings and machinery and
20 equipment may not exceed $200,000 or 50% of the total
21 capital development project costs, whichever is less.
22 (ii) A loan for working capital may not exceed
23 $100,000 or 50% of the total capital development project
24 costs, whichever is less.
25 (iii) Except for loans to agriculture producers, a
26 loan would create or preserve one job for every $25,000
27 loaned.
28 (2) The department shall notify the community
29 development institution and applicant of its decision.
30 (d) Approvals.--For applications which are approved, the
20030S0010B1501 - 35 -
1 department shall draw an advance equal to the principal amount
2 of the loan from the fund. The advance shall be forwarded to the
3 community development institution and, upon receipt by the
4 community development institution, become an obligation of the
5 community development institution. Prior to providing loan funds
6 to the applicant, the community development institution shall
7 require the applicant to execute a note and to enter into a loan
8 agreement. In addition to the requirements of subsection (e),
9 the loan agreement shall include a provision requiring the
10 recipient to use the loan proceeds to pay the costs of the
11 capital development project. The department may require the
12 community development institution to impose other terms and
13 conditions on the recipient if the department determines they
14 are in the best interests of this Commonwealth, including a
15 provision requiring collateral for any penalty imposed under
16 subsection (g).
17 (e) Loan terms.--A loan agreement entered into in accordance
18 with subsection (d) shall do all of the following:
19 (1) State any collateral securing the loan. The
20 department may use its best judgment to identify and secure
21 collateral.
22 (2) State the repayment period which may be flexible.
23 (3) State the interest rate which may not be less than
24 2% nor more than 5% for the term of the loan.
25 (4) State that the recipient agrees to maintain, at a
26 minimum, the number of jobs in existence as of the date of
27 loan application.
28 (f) Loan administration.--A loan made under this section
29 shall be administered in accordance with departmental policies
30 and procedures by the community development institution which
20030S0010B1501 - 36 -
1 made the loan. Each community development institution shall
2 submit an annual report on the form required by the department
3 which includes or demonstrates all of the following:
4 (1) Each outstanding loan.
5 (2) The date approved.
6 (3) The original principal amount.
7 (4) The current principal balance.
8 (5) The interest rate.
9 (6) The purpose for which the loan was made.
10 (7) An enumeration of any problems or issues which have
11 arisen with regard to each loan.
12 (8) A statement regarding the progress of the small
13 business in creating or preserving its requisite number of
14 employment opportunities.
15 (9) Any other information or documentation required by
16 the department.
17 (g) Penalty.--
18 (1) Except as provided in paragraph (2), the department
19 shall impose a penalty upon a recipient if the recipient
20 fails to create or preserve the number of employment
21 opportunities specified in its approved application.
22 (2) The department may waive the penalty required by
23 paragraph (1) if the department determines that the failure
24 was due to circumstances outside the control of the
25 recipient.
26 (3) The amount of any penalty imposed under paragraph
27 (1) shall be equal to an increase in the interest rate to 2%
28 greater than the current prime interest rate for the
29 remainder of the loan.
30 (h) Defaults.--The department may take title by foreclosure
20030S0010B1501 - 37 -
1 to a capital development project which it financed where
2 acquisition is necessary to protect a loan made under this
3 section. The department shall pay all costs arising out of the
4 foreclosure and acquisition from money held in the fund. The
5 department may, in order to minimize financial losses and
6 sustain employment, lease the capital development project. The
7 department may withdraw money from the fund to purchase first
8 mortgages and to make payments on first mortgages on any capital
9 development project which it financed if purchase or payment is
10 necessary to protect a loan made under this section. The
11 department may sell, transfer, convey and assign the first
12 mortgages and shall deposit in the fund money derived from the
13 sale of any first mortgages.
14 § 2309. Pollution prevention assistance loans.
15 (a) Application.--A small business may submit an application
16 and any application fee to a pollution prevention assistance
17 agency requesting a loan for a pollution prevention
18 infrastructure. The application shall be on the form required by
19 the department and shall include or demonstrate all of the
20 following:
21 (1) The name and address of the applicant.
22 (2) A statement of the amount of loan assistance sought.
23 (3) A statement of the pollution prevention
24 infrastructure, including a detailed statement of the cost of
25 the infrastructure.
26 (4) A firm financial commitment from a responsible
27 source for the cost of the pollution prevention
28 infrastructure in excess of the amount requested.
29 (5) Any other information required by the department.
30 (b) Pollution prevention assistance agency review.--
20030S0010B1501 - 38 -
1 (1) Upon receipt of a completed application, a pollution
2 prevention assistance agency shall investigate and determine
3 all of the following:
4 (i) If the applicant is a small business.
5 (ii) If the project is for pollution prevention
6 infrastructure.
7 (iii) If the pollution prevention infrastructure
8 demonstrates a substantial likelihood of preventing or
9 reducing pollution.
10 (iv) The ability of the applicant to meet and
11 satisfy the debt service as it becomes due and payable.
12 In reviewing repayment obligations, loans shall not be
13 approved on the basis of direct financial return on
14 investment and shall not be held to the loan loss
15 standards of private commercial lenders. Loans shall be
16 reviewed for the purpose of reducing pollution through
17 source reduction technologies or processes.
18 (v) The existence and sufficiency of collateral for
19 the loan. Collateral may include lien positions on
20 nonresidential real property and on personal property.
21 (vi) Relevant criminal and credit history and
22 ratings of the applicant as determined from outside
23 credit reporting services and other sources.
24 (vii) If the applicant complied with all other
25 criteria established by the department.
26 (2) Upon being satisfied that all requirements have been
27 met, the pollution prevention assistance agency shall
28 recommend the applicant to the department and forward the
29 application with all supporting documentation to the
30 department for its review and approval.
20030S0010B1501 - 39 -
1 (c) Department review.--
2 (1) Within 30 days of receiving a recommendation and
3 application, the department shall review the application. The
4 Department of Environmental Protection shall assist the
5 department in reviewing the applications and provide
6 technical assistance. If the department is satisfied that all
7 requirements have been met, the department may approve the
8 loan request. A loan approved under this subsection may not
9 exceed the lesser of:
10 (i) $100,000; or
11 (ii) 75% of infrastructure costs.
12 (2) The department shall notify the pollution prevention
13 assistance agency and applicant of its decision.
14 (d) Approvals.--For applications which are approved, the
15 department shall draw an advance equal to the principal amount
16 of the loan from the Pollution Prevention Assistance Account.
17 The advance shall be forwarded to the pollution prevention
18 assistance agency and, upon receipt by the pollution prevention
19 assistance agency, become an obligation of the pollution
20 prevention assistance agency. Prior to providing loan funds to
21 the applicant, the pollution prevention assistance agency shall
22 require the applicant to execute a note and to enter into a loan
23 agreement. In addition to the requirements of subsection (e),
24 the loan agreement shall include a provision requiring the
25 recipient to use the loan proceeds to pay the costs of the
26 pollution prevention infrastructure. The department may require
27 the pollution prevention assistance agency to impose other terms
28 and conditions on the recipient if the department determines
29 they are in the best interests of this Commonwealth, including a
30 provision requiring collateral for any penalty imposed under
20030S0010B1501 - 40 -
1 subsection (g).
2 (e) Loan terms.--A loan agreement entered into in accordance
3 with subsection (d) shall do all of the following:
4 (1) State the collateral securing the loan. All loans
5 shall be secured by lien positions on collateral at the
6 highest level of priority as may be determined by the
7 pollution prevention assistance agency with the approval of
8 the department. The collateral may include nonresidential
9 real estate purchased as part of the pollution prevention
10 infrastructure.
11 (2) State the repayment period which may not exceed 10
12 years.
13 (3) State that the interest rate is 2%.
14 (4) State that any loan fee is not to exceed 5% of the
15 loan amount.
16 (f) Loan administration.--A loan made under this section
17 shall be administered in accordance with departmental policies
18 and procedures by the pollution prevention assistance agency
19 which made the loan. Each pollution prevention assistance agency
20 shall submit an annual report on the form required by the
21 department which includes or demonstrates all of the following:
22 (1) Each outstanding loan.
23 (2) The date approved.
24 (3) The original principal amount.
25 (4) The current principal balance.
26 (5) The interest rate.
27 (6) The purpose for which the loan was made.
28 (7) An enumeration of any problems or issues which have
29 arisen with regard to each loan.
30 (8) Any other information or documentation required by
20030S0010B1501 - 41 -
1 the department.
2 (g) Penalty.--
3 (1) Except as provided in paragraph (2), the department
4 shall impose a penalty upon a recipient if the recipient
5 fails to prevent or reduce pollution as specified in its
6 approved application.
7 (2) The department may waive the penalty required by
8 paragraph (1) if the department determines that the failure
9 was due to circumstances outside the control of the
10 recipient.
11 (3) The amount of any penalty imposed under paragraph
12 (1) shall be equal to an increase in the interest rate to 2%
13 greater than the current prime interest rate for the
14 remainder of the loan.
15 (h) Defaults.--The department may take title by foreclosure
16 to a pollution prevention infrastructure which it financed if
17 acquisition is necessary to protect a loan made under this
18 section. The department shall pay all costs arising out of the
19 foreclosure and acquisition from money held in the Pollution
20 Prevention Assistance Account. The department may, in order to
21 minimize financial losses and sustain employment, lease the
22 pollution prevention infrastructure. The department may withdraw
23 money from the Pollution Prevention Assistance Account to
24 purchase first mortgages and to make payments on first mortgages
25 on any pollution prevention infrastructure which it financed if
26 the purchase or payment is necessary to protect a loan made
27 under this section. The department may sell, transfer, convey
28 and assign the first mortgages and shall deposit any money
29 derived from the sale of any first mortgages in the Pollution
30 Prevention Assistance Account.
20030S0010B1501 - 42 -
1 § 2310. Export financing loans.
2 (a) Application.--A person may submit an application and any
3 applicable application fee to the department or its area loan
4 organization requesting a loan for certain costs of a capital
5 development project which will be used in export activities. The
6 application must be on the form required by the department and
7 must include or demonstrate all of the following:
8 (1) The name and address of the applicant.
9 (2) A statement of the amount of loan assistance sought.
10 (3) A statement of the capital development project,
11 including a detailed statement of the cost of the project.
12 (4) A statement that the capital development project is
13 based upon an export contract which requires payment in
14 United States dollars.
15 (5) A firm financial commitment from a responsible
16 source for any cost of the capital development project in
17 excess of the amount requested.
18 (6) A statement that the loan, if approved, would not
19 supplant funding from private sector sources on commercially
20 reasonable terms.
21 (7) Any other information required by the department.
22 (b) Review.--
23 (1) Upon receipt of a competed application, the
24 department or, if applicable, an area loan organization shall
25 investigate and determine all of the following:
26 (i) If the applicant is an export business.
27 (ii) If the project is a capital development
28 project.
29 (iii) If the capital development project
30 demonstrates a substantial likelihood of creating or
20030S0010B1501 - 43 -
1 preserving employment activities in this Commonwealth.
2 (iv) The ability of the applicant to meet and
3 satisfy the debt service as it becomes due and payable.
4 (v) The existence and sufficiency of collateral for
5 the loan. Collateral may include lien positions on
6 nonresidential real property and on personal property.
7 (vi) Relevant criminal and credit history and
8 ratings of the applicant as determined from outside
9 credit reporting services and other sources.
10 (vii) Number of employment opportunities to be
11 created or preserved by the proposed capital development
12 project.
13 (viii) If the applicant complied with all other
14 criteria established by the department.
15 (2) Upon being satisfied that all requirements have been
16 met, the department may approve the application in accordance
17 with subsection (c) or the area loan organization shall
18 recommend the applicant to the department and forward the
19 application with all supporting documentation to the
20 department for its review and approval.
21 (c) Department review.--The department shall review an
22 application within 30 days of receiving it. If the department is
23 satisfied that all requirements have been met, the department
24 may approve the loan request. A loan approved under this section
25 may not exceed $350,000. The department shall notify the
26 applicant and, if applicable, the area loan organization of its
27 decision.
28 (d) Approvals.--
29 (1) For applications which were submitted directly to
30 the department and which are approved, the department shall
20030S0010B1501 - 44 -
1 draw an advance equal to the principal amount of the loan
2 from the Export Activities Assistance Account. Prior to
3 providing funds to the applicant, the department shall
4 require the applicant to execute a note and enter into a loan
5 agreement. In addition to the requirements of subsection (e),
6 the loan agreement shall include a provision requiring the
7 recipient to use the loan proceeds to pay the costs of the
8 capital development project. The department may impose other
9 terms and conditions on the recipient if the department
10 determines they are in the best interests of this
11 Commonwealth, including any of the following:
12 (i) A provision requiring collateral for any penalty
13 imposed under subsection (g).
14 (ii) A provision requiring the person to be eligible
15 for an insurance policy.
16 (iii) A provision requiring the loan to be
17 guaranteed by the Working Capital Guaranty Program
18 offered by the Ex-Im Bank.
19 (iv) A provision requiring an export credit sales
20 contract insured by an insurance policy.
21 (2) For applications which were submitted to the
22 department through an area loan organization and which are
23 approved, the department shall draw an advance equal to the
24 principal amount of the loan from the Export Activities
25 Assistance Account. The advance shall be forwarded to the
26 area loan organization and, upon receipt by the area loan
27 organization, become an obligation of the area loan
28 organization. Prior to providing loan funds to the applicant,
29 the area loan organization shall require the applicant to
30 execute a note and enter into a loan agreement. In addition
20030S0010B1501 - 45 -
1 to the requirements of subsection (e), the loan agreement
2 shall include a provision requiring the recipient to use the
3 loan proceeds to pay the costs of the capital development
4 project. The department may require the area loan
5 organization to impose other terms and conditions on the
6 recipient if the department determines they are in the best
7 interests of this Commonwealth, including any of the
8 following:
9 (i) A provision requiring collateral for any penalty
10 imposed under subsection (g).
11 (ii) A provision requiring the person to be eligible
12 for an insurance policy.
13 (iii) A provision requiring the loan to be
14 guaranteed by the Working Capital Guaranty Program
15 offered by the Ex-Im Bank.
16 (iv) A provision requiring an export credit sales
17 contract insured by an insurance policy.
18 (e) Loan terms.--A loan agreement entered into in accordance
19 with subsection (d) shall do all of the following:
20 (1) State the collateral securing the loan. All loans
21 shall be secured by lien positions on collateral at the
22 highest level of priority as may be determined by the area
23 loan organization with the approval of the department. The
24 collateral may include nonresidential real estate purchased
25 as part of a capital development project.
26 (2) State the repayment period as determined by the
27 department.
28 (3) State the interest rate as determined by the
29 department.
30 (f) Loan administration.--A loan made under this section
20030S0010B1501 - 46 -
1 shall be administered in accordance with departmental policies
2 and procedures. If a loan was made through an area loan
3 organization, the area loan organization shall submit an annual
4 report on the form required by the department which includes or
5 demonstrates all of the following:
6 (1) Each outstanding loan.
7 (2) The date approved.
8 (3) The original principal amount.
9 (4) The current principal balance.
10 (5) The interest rate.
11 (6) The purpose for which the loan was made.
12 (7) An enumeration of any problems or issues which have
13 arisen with regard to each loan.
14 (8) A statement regarding the progress of the person
15 creating or preserving its requisite number of employment
16 opportunities.
17 (9) Any other information or documentation required by
18 the department.
19 (g) Penalty.--
20 (1) Except as provided in paragraph (2), the department
21 shall impose a penalty upon a recipient if the recipient
22 fails to create or preserve the number of employment
23 opportunities specified in its approved application.
24 (2) The department may waive the penalty required by
25 paragraph (1) if the department determines that the failure
26 was due to circumstances outside the control of the
27 recipient.
28 (3) The amount of the penalty imposed under paragraph
29 (1) shall be equal to an increase in the interest rate to 2%
30 greater than the current prime interest rate for the
20030S0010B1501 - 47 -
1 remainder of the loan.
2 (h) Defaults.--The department may, by foreclosure, take
3 title to a capital development project which it financed if
4 acquisition is necessary to protect a loan made under this
5 section. The department shall pay all costs arising out of the
6 foreclosure and acquisition from money held in the Export
7 Activities Assistance Account. The department may, in order to
8 minimize financial losses and sustain employment, lease the
9 capital development project. The department may withdraw money
10 from the Export Activities Assistance Account to purchase first
11 mortgages and to make payments on first mortgages on any capital
12 development project which it financed if purchase or payment is
13 necessary to protect a loan made under this section. The
14 department may sell, transfer, convey and assign the first
15 mortgages and shall deposit any money derived from the sale of
16 any first mortgages in the Export Activities Assistance Account.
17 § 2311. Reporting and inspection.
18 (a) Inspection.--An applicant or a recipient shall, upon
19 request, permit authorized employees of the department or its
20 agent to inspect the plant, books and records of the applicant
21 or recipient.
22 (b) Updating.--An applicant or a recipient shall provide
23 updated information to the department and its agents if
24 conditions change or to the extent that the information
25 originally given becomes inaccurate or misleading.
26 (c) Periodic reports.--A recipient shall provide the
27 department and its agents with such periodic financial reports
28 as the department may require until the loan is repaid in full.
29 (d) Financial and performance audits.--An agent of the
30 department shall annually submit to the department, at the
20030S0010B1501 - 48 -
1 agent's expense, an independent financial audit. If the audit
2 reveals misconduct of a material nature on the part of the
3 agent, the department shall take appropriate action.
4 § 2312. Limitations.
5 No loans shall be recommended or approved if the proceeds of
6 the loan could do any of the following:
7 (1) Cause, aid or assist directly in the relocation of
8 any business operations from one part of this Commonwealth to
9 another unless there is at least a 25% net increase in
10 employment.
11 (2) Refinance any portion of the total cost of a capital
12 development project, pollution prevention infrastructure or
13 other existing loans or debt.
14 (3) Finance a capital development project or pollution
15 prevention infrastructure located outside the geographic
16 boundaries of this Commonwealth.
17 (4) Provide funds, directly or directly, for payment
18 distribution or as loan owners, partners or shareholders of a
19 small business, except as ordinary compensation for services
20 rendered.
21 (5) Provide funds for speculation in real or personal
22 property, whether tangible or intangible.
23 CHAPTER 25
24 INDUSTRIAL DEVELOPMENT ASSISTANCE
25 (RESERVED)
26 CHAPTER 27
27 CUSTOMIZED JOB TRAINING
28 (RESERVED)
29 CHAPTER 29
30 MACHINERY AND EQUIPMENT
20030S0010B1501 - 49 -
1 (RESERVED)
2 CHAPTER 31
3 FAMILY SAVINGS ACCOUNT
4 (RESERVED)
5 CHAPTER 33
6 ECONOMIC ENHANCEMENT
7 Sec.
8 3301. Scope of chapter.
9 3302. Definitions.
10 3303. Establishment.
11 3304. Review Committee.
12 3305. Application.
13 3306. Review and approval.
14 3307. Designation.
15 § 3301. Scope of chapter.
16 This chapter relates to the Economic Enhancement Program.
17 § 3302. Definitions.
18 The following words and phrases when used in this chapter
19 shall have the meaning given to them in this section unless the
20 context clearly indicates otherwise:
21 "Authority." The Pennsylvania Economic Development Financing
22 Authority established in Chapter 43 (relating to Pennsylvania
23 Economic Development Financing Authority).
24 "Committee." The Review Committee established in section
25 3304 (relating to review committee).
26 "Department." The Department of Community and Economic
27 Development of the Commonwealth.
28 "Deteriorated property." A blighted, impoverished area
29 containing residential, industrial, commercial or other real
30 property which is abandoned, unsafe, vacant, undervalued,
20030S0010B1501 - 50 -
1 underutilized, overgrown, defective, condemned, demolished or
2 which contains economically undesirable land use. The term
3 includes all of the following:
4 (1) A tax increment district.
5 (2) Property adjacent to deteriorated property which is
6 significantly undervalued and underutilized due to the
7 proximity of the deteriorated property.
8 "Issuing authority." As that term is defined in the act of
9 July 11, 1990 (P.L.465, No.113), known as the Tax Increment
10 Financing Act.
11 "Tax incentive district." A contiguous geographic area
12 designated by the Department of Community and Economic
13 Development under section 3307 (relating to designation).
14 "Tax increment district." The term as it is defined in the
15 act of July 11, 1990 (P.L.465, No.113), known as the Tax
16 Increment Financing Act.
17 § 3303. Establishment.
18 There is hereby established within the department a program
19 to be known as the Economic Enhancement Program. The program
20 shall provide economic assistance to deteriorated property by
21 using certain tax revenues from property located in incentive
22 districts to increase economic development in incentive
23 districts.
24 § 3304. Review Committee.
25 (a) Establishment.--There is hereby established a committee
26 to be known as the Review Committee. The committee shall review
27 and recommend applications to the Governor. The committee shall
28 be composed of the following five members:
29 (1) The Governor or the Secretary of the Budget.
30 (2) The Majority Leader of the Senate, or a designee.
20030S0010B1501 - 51 -
1 (3) The Minority Leader of the Senate, or a designee.
2 (4) The Majority Leader of the House of Representatives,
3 or a designee.
4 (5) The Minority Leader of the House of Representatives,
5 or a designee.
6 (b) Operation.--The Governor or the Secretary of the Budget
7 shall serve as chairperson. The committee shall meet at the call
8 of the chairperson. Four members shall constitute a quorum, and
9 the consent of four members of the committee shall be required
10 to recommend an application.
11 § 3305. Application.
12 A person or an issuing authority may apply to the department
13 to have deteriorated property designated an incentive district.
14 The application shall be on a form provided by the department
15 and shall include all of the following:
16 (1) The name and address of the applicant.
17 (2) A legal description of the property which is to be
18 included in the incentive district.
19 (3) A statement that the property is deteriorated.
20 (4) A firm commitment of future economic development on
21 the property if the property were designated an incentive
22 district.
23 (5) Any other information required by the department.
24 § 3306. Review and approval.
25 (a) Review.--The department shall forward the application to
26 the committee when it is complete. The committee shall review
27 the application to determine all of the following:
28 (1) If the applicant is firmly committed to improving
29 the property upon designation.
30 (2) If the applicant complied with all other criteria
20030S0010B1501 - 52 -
1 established by the committee.
2 (b) Approval.--Upon being satisfied that all requirements
3 have been met, the committee may approve the application and
4 recommend that the property be designated an incentive district.
5 The recommendation shall specify the time period for which the
6 property may be designated, not to exceed 20 years. The
7 department shall immediately notify affected municipalities of
8 the recommendation.
9 § 3307. Designation.
10 Within 90 days of receiving notification in accordance with
11 section 3306 (relating to review and approval), a municipality
12 may request the department to designate the deteriorated
13 property as a tax incentive district. The request shall be on a
14 form provided by the department and shall include a copy of the
15 ordinance, resolution or other required action from the
16 governing body of the municipality approving the designation of
17 the property as a tax incentive district. All appropriate
18 ordinances and resolutions shall be binding and nonrevocable on
19 the municipality. If all municipalities within a recommended tax
20 incentive district submit timely completed requests, the
21 department shall approve the requests and designate the property
22 as a tax incentive district. Upon designation, persons owning
23 property located within a tax incentive district and issuing
24 authorities of tax increment districts located within a tax
25 incentive district shall be eligible to receive grants and loans
26 under the Economic Enhancement Financing Program administered by
27 the Pennsylvania Economic Development Financing Authority.
28 CHAPTER 35
29 KEYSTONE ECONOMIC DEVELOPMENT ZONES
30 Subchapter
20030S0010B1501 - 53 -
1 A. General Provisions
2 B. Keystone Opportunity Zones and Keystone Opportunity
3 Expansion Zones
4 C. State Taxes (Reserved)
5 D. Local Taxes (Reserved)
6 E. Administration of Tax Provisions(Reserved)
7 F. Procedures for Zones (Reserved)
8 G. Miscellaneous Provisions (Reserved)
9 SUBCHAPTER A
10 GENERAL PROVISIONS
11 Sec.
12 3501. Scope.
13 3502. Legislative findings (Reserved).
14 3503. Definitions.
15 § 3501. Scope.
16 This chapter relates to Keystone Opportunity Zones and
17 Keystone Opportunity Expansion Zones.
18 § 3502. Legislative findings.
19 (Reserved)
20 § 3503. Definitions.
21 The following words and phrases when used in this chapter
22 shall have the meanings given to them in this section unless the
23 context clearly indicates otherwise:
24 "Business." An association, partnership, corporation, sole
25 proprietorship, limited liability company or employer.
26 "Department." The Department of Community and Economic
27 Development of the Commonwealth.
28 "Deteriorated property." Any blighted, impoverished area
29 containing residential, industrial, commercial or other real
30 property which is abandoned, unsafe, vacant, undervalued,
20030S0010B1501 - 54 -
1 underutilized, overgrown, defective, condemned, demolished or
2 which contains economically undesirable land use. The term
3 includes property adjacent to deteriorated property which is
4 significantly undervalued and underutilized due to the proximity
5 of the deteriorated property.
6 "Domicile." The place where a person has a true and fixed
7 home and principal establishment for an indefinite time and to
8 which, whenever absent, that person intends to return. Domicile
9 continues until another place of domicile is established.
10 "Expansion subzone." A clearly defined geographic area
11 containing a minimum of 15 contiguous acres or a minimum of five
12 contiguous acres in a rural area.
13 "Improvement subzone." A clearly defined geographic area.
14 "Institution."
15 (1) Every bank operating as such and having capital
16 stock which is incorporated under any law of this
17 Commonwealth, under the law of the United States or under the
18 law of any other jurisdiction and is located within this
19 Commonwealth.
20 (2) Every operating company having capital stock located
21 within this Commonwealth having any of the powers of
22 companies entitled to the benefits of section 29 of the act
23 of April 29, 1874 (P.L.73, No.32), entitled "An act to
24 provide for the incorporation and regulation of certain
25 corporations," and any supplements thereto and under the act
26 of June 27, 1895 (P.L.399, No.286), entitled "An act
27 conferring upon certain fidelity, insurance, safety deposit,
28 trust and savings companies the powers and privileges of
29 companies incorporated under the provisions of section
30 twenty-nine of an act, entitled 'An act to provide for the
20030S0010B1501 - 55 -
1 incorporation and regulation of certain corporations,'
2 approved April twenty-ninth, Anno Domini one thousand eight
3 hundred and seventy-four, and of the supplements thereto."
4 (3) Every company organized and operating as a bank and
5 trust company or as a trust company having capital stock
6 located in this Commonwealth, whether the institution is
7 incorporated under any law of this Commonwealth, the law of
8 the United States or any law of any jurisdiction. The term
9 shall not include any of such companies, all of the shares of
10 capital stock of which, other than shares necessary to
11 qualify directors, are owned by a company which is liable to
12 pay to the Commonwealth a tax pursuant to Article VII of the
13 act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform
14 Code of 1971.
15 (4) A mutual thrift institution.
16 "Insurance company." Every insurance company, association or
17 exchange incorporated or organized by or under the laws of this
18 Commonwealth, the United States, territories, dependencies,
19 other states or foreign governments and engaged in transacting
20 insurance business of any kind or classification within this
21 Commonwealth, except title insurance companies subject to tax
22 under Article VIII or XVI of the act of March 4, 1971 (P.L.6,
23 No.2), known as the Tax Reform Code of 1971, as the case may be,
24 except purely mutual beneficial associations whose funds for the
25 benefit of members and families or heirs are made up entirely of
26 the weekly, monthly, quarterly, semiannual or annual
27 contributions to their members and the accumulated interest
28 thereon and corporations organized under the former act of June
29 21, 1937 (P.L.1948, No.378), known as the Nonprofit Hospital
30 Plan Act, and under the former act of June 27, 1939 (P.L.1125,
20030S0010B1501 - 56 -
1 No.399), known as the Nonprofit Medical, Osteopathic, Dental and
2 Podiatry Service Corporation Act.
3 "Keystone Act." The act of October 6, 1998 (P.L.705, No.92),
4 known as the Keystone Opportunity Zone and Keystone Opportunity
5 Expansion Zone Act.
6 "Keystone opportunity expansion zone." A defined geographic
7 area comprised of one or more political subdivisions or portions
8 of political subdivisions designated by the Department of
9 Community and Economic Development under Subch. B (relating to
10 keystone opportunity zones and keystone expansion zones). A
11 keystone opportunity expansion zone may be comprised of not more
12 than eight expansion subzones.
13 "Keystone opportunity zone." A defined geographic area
14 comprised of one or more political subdivisions or portions of
15 political subdivisions designated by the Department of Community
16 and Economic Development under Subch. B (relating to keystone
17 opportunity zones and keystone opportunity expansion zones). A
18 keystone opportunity zone may be comprised of not more than 12
19 subzones.
20 "Metropolitan statistical area." A core area containing a
21 city with a population of 50,000 or more or a Bureau of Census
22 defined urbanized area of 50,000 with a total metropolitan
23 population of at least 100,000.
24 "Mutual thrift institution." Every:
25 (1) savings bank without capital stock;
26 (2) building and loan association;
27 (3) savings and loan association;
28 (4) savings institution having capital stock;
29 whether the mutual thrift institution is incorporated under any
30 law of this Commonwealth or under the law of the United States,
20030S0010B1501 - 57 -
1 or is incorporated under the law of any other jurisdiction and
2 is located within this Commonwealth.
3 "Opportunity plan." A written plan that addresses the
4 criteria and meets the requirements in section 3514(a) (relating
5 to application).
6 "Person." An individual.
7 "Political subdivision." A county, city, borough, township,
8 town or school district with taxing jurisdiction in a defined
9 geographic area within this Commonwealth.
10 "Qualified business." A business authorized to do business
11 in this Commonwealth that is located or partially located within
12 a subzone or expansion subzone and is engaged in the active
13 conduct of a trade or business in accordance with the
14 requirements of section 3519 (relating to qualified businesses)
15 for the taxable year. An agent, broker or representative of a
16 business is not engaged in the active conduct of trade or
17 business for the business.
18 "Qualified political subdivision." A political subdivision
19 that has real property within its jurisdiction which has been
20 designated by the department as a subzone or expansion subzone.
21 "Resident." A person who is domiciled and resides in an area
22 that is designated a subzone or expansion subzone and who meets
23 the requirements of section 3518 (relating to residency).
24 "Subzone." A clearly defined geographic area containing a
25 minimum of 20 contiguous acres or a minimum of ten contiguous
26 acres in a rural area.
27 "Tax Reform Code of 1971." The act of March 4, 1971 (P.L.6,
28 No.2), known as the Tax Reform Code of 1971, and any subsequent
29 amendments thereto.
30 SUBCHAPTER B
20030S0010B1501 - 58 -
1 KEYSTONE OPPORTUNITY ZONES AND KEYSTONE
2 OPPORTUNITY EXPANSION ZONES
3 Sec.
4 3511. Keystone opportunity zones.
5 3512. Keystone opportunity expansion zones.
6 3513. Keystone opportunity improvement zones.
7 3514. Application.
8 3515. Review.
9 3516. Criteria for authorization of keystone opportunity
10 zone.
11 3517. Zone limitations.
12 3518. Residency.
13 3519. Qualified businesses.
14 3520. Forms.
15 3521. Decertification.
16 § 3511. Keystone opportunity zones.
17 (a) Establishment.--There is established within the
18 department a program providing for keystone opportunity zones. A
19 keystone opportunity zone shall be comprised of deteriorated
20 property and shall not exceed a total of 5,000 acres.
21 (b) Zone authorization.--The department shall authorize not
22 more than 12 keystone opportunity zones in this Commonwealth.
23 Persons and businesses within an authorized keystone opportunity
24 zone that are qualified under this chapter shall be entitled to
25 all tax exemptions, deductions, abatements or credits set forth
26 in Chapters 5 and 7 of the Keystone Act for a period not to
27 exceed 15 years beginning January 1, 1999, and ending on or
28 before December 31, 2013.
29 (c) Subzone designation.--The department may designate not
30 more than 12 subzones in each keystone opportunity zone. The
20030S0010B1501 - 59 -
1 total number of subzone acres in a keystone opportunity zone
2 shall not exceed 5,000 acres in the aggregate.
3 (d) Authorization for local tax exemption.--Every political
4 subdivision within which a proposed subzone is located, whether
5 in whole or in part, is authorized to provide tax exemptions,
6 deductions, abatements or credits to persons and businesses
7 qualified under this chapter. The political subdivision must
8 agree to provide exemptions, deductions, abatements or credits
9 from all local taxes set forth in Chapter 7 of the Keystone Act
10 in order to qualify to be designated a subzone. Except as
11 provided in section 3515(e) (relating to review), the
12 exemptions, deductions, abatements or credits must be effective
13 January 1, 1999, if designation of a subzone within the
14 political subdivision is granted by the department. The
15 exemptions, deductions, abatements or credits shall be binding
16 upon the political subdivision for the duration of the subzone
17 designation.
18 (e) Authorization to extend the duration of a keystone
19 opportunity zone or subzone.--A subzone of a keystone
20 opportunity zone may request to extend its designation as a
21 subzone for a period of three years. A subzone that is part of a
22 keystone opportunity zone that will expire on December 31, 2008,
23 may extend its designation as a subzone to December 31, 2010, or
24 to December 31, 2013. The request to extend a subzone
25 designation must be made on a subzone-by-subzone basis. A
26 qualified political subdivision having an approved subzone
27 within its jurisdiction and seeking to extend the subzone
28 designation must pass the required ordinances, resolutions or
29 other required action of the qualified political subdivision for
30 the exemptions, deductions, abatements or credits set forth in
20030S0010B1501 - 60 -
1 Chapter 7 of the Keystone Act for the period beginning after
2 December 31, 2008, or December 31, 2010, as the case may be, and
3 must submit copies of the ordinance, resolution or other action
4 to the department by June 30, 2001. The department may grant the
5 request to extend if all the proper binding ordinances,
6 resolutions or other governing documents are passed by all
7 qualified political subdivisions within the subzone extending
8 the necessary exemptions, deductions, abatements and credits to
9 the entire subzone to December 31, 2010, or December 31, 2013.
10 The department shall approve or deny the request for extension
11 of duration of a subzone by July 31, 2001, and shall provide
12 written notice, irrespective of whether approved or denied, to
13 each qualified political subdivision, resident and qualified
14 business affected. Upon approval of a request for extension of
15 duration of a subzone, the exemptions, deductions, abatements or
16 credits shall be binding upon the qualified political
17 subdivision as provided in subsection (d).
18 (f) Authorization to enhance existing subzones.--Unless as a
19 result of a request the limitation on size established in
20 subsection (a) would be exceeded, a subzone of a keystone
21 opportunity zone may request to enhance its size. The request to
22 enhance a subzone must be made on a subzone-by-subzone basis. A
23 qualified political subdivision having an approved subzone
24 within its jurisdiction which is seeking to enhance its size
25 must pass the required ordinances, resolutions or other required
26 action of the qualified political subdivision for the
27 exemptions, deductions, abatements or credits set forth in
28 Chapter 7 of the Keystone Act for the period beginning on the
29 date of designation and ending on the date the subzone expires
30 and must submit copies of the ordinance, resolution or other
20030S0010B1501 - 61 -
1 action to the department by June 1, 2003.
2 § 3512. Keystone opportunity expansion zones.
3 (a) Establishment.--There is established within the
4 department a program providing for keystone opportunity
5 expansion zones. A keystone opportunity expansion zone shall be
6 comprised of deteriorated property and shall not exceed a total
7 of 1,500 acres.
8 (b) Authorization.--The department shall authorize not more
9 than 12 keystone opportunity expansion zones in this
10 Commonwealth. Persons and businesses within an authorized
11 keystone opportunity expansion zone that are qualified under the
12 Keystone Act shall be entitled to all tax exemptions,
13 deductions, abatements or credits set forth in Chapters 5 and 7
14 of the Keystone Act for a period of ten or 13 years beginning
15 January 1, 2001, and ending on December 31, 2010, or December
16 31, 2013.
17 (c) Expansion subzone designation.--The department may
18 designate not more than eight expansion subzones in a keystone
19 opportunity expansion zone. The total number of expansion
20 subzone acres in a keystone opportunity expansion zone shall not
21 exceed 1,500 acres in the aggregate.
22 (d) Authorization for local tax exemption.--Every political
23 subdivision within which a proposed expansion subzone is
24 located, whether in whole or in part, is authorized to provide
25 tax exemptions, deductions, abatements or credits to persons and
26 businesses qualified under this chapter for a period ending
27 December 31, 2010, or December 31, 2013. The exemption period
28 must be uniform within each expansion subzone. The political
29 subdivision must agree to provide exemptions, deductions,
30 abatements or credits from all local taxes set forth in Chapter
20030S0010B1501 - 62 -
1 7 of the Keystone Act in order to qualify to be designated an
2 expansion subzone. The exemptions, deductions, abatements or
3 credits must be effective January 1, 2001, if designation of an
4 expansion subzone within the political subdivision is granted by
5 the department. The exemptions, deductions, abatements or
6 credits shall be binding upon the political subdivision for the
7 duration of the expansion subzone designation.
8 (e) Authorization to enhance existing expansion subzones.--
9 Unless as a result of a request the limitation on size
10 established in subsection (a) would be exceeded, a keystone
11 opportunity expansion zone may request to enhance its size. The
12 request to enhance the expansion zone must be made on an
13 expansion-subzone-by-expansion-subzone basis. A qualified
14 political subdivision which is seeking an expansion subzone
15 within its jurisdiction must pass the required ordinance,
16 resolution or other required action of the qualified political
17 subdivision for the exemptions, deductions, abatements or
18 credits set forth in Chapter 7 of the Keystone Act for the
19 period beginning on January 1, 2004, and ending on December 31,
20 2010, or on December 31, 2013. Copies of the ordinance,
21 resolution or other action must be submitted to the department
22 by December 31, 2003.
23 § 3513. Keystone opportunity improvement zones.
24 (a) Establishment.--There is established within the
25 department a program for keystone opportunity improvement zones.
26 A keystone opportunity improvement zone shall be comprised of
27 improvement subzones consisting of deteriorated property
28 designated by the Governor.
29 (b) Proposal.--By January 1, 2003, and notwithstanding any
30 designation under sections 3511 (relating to keystone
20030S0010B1501 - 63 -
1 opportunity zones) and 3512 (relating to keystone opportunity
2 expansion zones), the Governor may, by executive order,
3 designate deteriorated property in this Commonwealth as a
4 proposed improvement subzone. The executive order shall specify
5 the period of time, not to exceed 15 years, for which the tax
6 exemptions, deductions, abatements or credits provided by
7 Chapters 5 and 7 of the Keystone Act may be granted. The
8 department shall immediately notify political subdivisions
9 located within the area designated.
10 (c) Application.--By June 1, 2004, a political subdivision
11 may apply to the department for approval of the designation of
12 the deteriorated property as an improvement subzone for the
13 period designated under subsection (b). The application must be
14 on a form provided by the department and must include a copy of
15 an ordinance, resolution or other required action from the
16 governing body of the political subdivision exempting or
17 providing the deductions, abatements or credits set forth in
18 Chapter 7 of the Keystone Act to qualified persons and qualified
19 businesses within the proposed improvement subzone. Except as
20 provided in section 3521 (relating to decertification), all
21 appropriate ordinances and resolutions must be effective for the
22 period specified in the executive order and must be binding and
23 nonrevocable on the political subdivision.
24 (d) Designation.--If all political subdivisions within a
25 proposed improvement subzone submit timely completed
26 applications, the department shall approve the applications and
27 designate the property as an improvement subzone. If a proposed
28 improvement subzone is an existing subzone or an existing
29 expansion subzone, failure of a political subdivision to submit
30 the application as required by this section shall not terminate
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1 the existing designation as either a subzone or an expansion
2 subzone. Qualified persons and qualified businesses within the
3 improvement subzone shall be entitled to the State exemptions,
4 deductions, abatements or credits set forth in Chapter 5 of the
5 Keystone Act and the local tax exemptions, deductions,
6 abatements or credits set forth in Chapter 7 of the Keystone Act
7 for the period for which the improvement subzone has been
8 designated.
9 § 3514. Application.
10 (a) Initial application.--One or more political
11 subdivisions, or a designee of one or more political
12 subdivisions, may apply to the department to designate
13 deteriorated property within the political subdivision or
14 portions thereof a subzone or expansion subzone. The application
15 must contain the following:
16 (1) The geographic area of the proposed keystone
17 opportunity zone or proposed keystone opportunity expansion
18 zone. The geographic area must be located within the
19 boundaries of the participating political subdivision and
20 must not contain more than 5,000 acres in the case of a
21 keystone opportunity zone or 1,500 acres in the case of a
22 keystone opportunity expansion zone.
23 (2) An opportunity plan that must include the following:
24 (i) A detailed map of the proposed keystone
25 opportunity zone or proposed keystone opportunity
26 expansion zone, including geographic boundaries, total
27 area and present use and conditions of the land and
28 structures of the proposed keystone opportunity zone or
29 proposed keystone opportunity expansion zone.
30 (ii) Evidence of support from and participation of
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1 local government, school districts and other educational
2 institutions, business groups, community organizations
3 and the public.
4 (iii) A proposal to increase economic opportunity,
5 reduce crime, improve education, facilitate
6 infrastructure improvement, reduce the local regulating
7 burden and identify potential jobs and job training
8 opportunities and which states whether or not the zone is
9 located in an area which has tax revenue dedicated to the
10 payment of debt.
11 (iv) A description of the current social, economic
12 and demographic characteristics of the proposed keystone
13 opportunity zone or proposed keystone opportunity
14 expansion zone and anticipated improvements in education,
15 health, human services, public safety and employment,
16 that will result from keystone opportunity zone or
17 keystone opportunity expansion zone designation.
18 (v) A description of anticipated activity in the
19 proposed keystone opportunity zone or proposed keystone
20 opportunity expansion zone, including, industrial use,
21 industrial site reuse, commercial or retail use and
22 residential use.
23 (vi) Evidence of potential private and public
24 investment in the proposed keystone opportunity zone or
25 proposed keystone opportunity expansion zone.
26 (vii) The role of the proposed keystone opportunity
27 zone or proposed keystone opportunity expansion zone in
28 regional economic and community development.
29 (viii) Plans to utilize existing resources for the
30 administration of the proposed keystone opportunity zone
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1 or proposed keystone opportunity expansion zone.
2 (ix) Any other information deemed appropriate by the
3 department.
4 (3) A report on youth at risk to include issues relating
5 to health, welfare and education.
6 (4) The duration of the proposed subzones or proposed
7 expansion subzones. The duration of a subzone may not exceed
8 15 years. The duration of an expansion subzone may not exceed
9 13 years.
10 (5) A formal, binding ordinance or resolution passed by
11 every political subdivision in which the proposed subzone or
12 proposed expansion subzone is located that specifically
13 provides for all local tax exemptions, deductions, abatements
14 or credits for persons and businesses set forth in the
15 Keystone Act.
16 (6) Evidence that the proposed keystone opportunity zone
17 or proposed keystone opportunity expansion zone meets the
18 required criteria under section 3516 (relating to criteria
19 for authorization of keystone opportunity zone).
20 (a.1) Enhancement application.--One or more political
21 subdivisions within an existing keystone opportunity zone or
22 keystone opportunity expansion zone, or a designee of one or
23 more political subdivisions within an existing keystone
24 opportunity zone or keystone opportunity expansion zone, may
25 apply to the department to designate deteriorated property
26 within the political subdivision or portions of the political
27 subdivision as enhancements to a subzone or an expansion
28 subzone. The application must satisfy the requirements of
29 subsection (a)(1), (2), (3), (5) and (6).
30 (b) Participation limitation.--A political subdivision may
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1 not be a part of more than one proposed keystone opportunity
2 zone or proposed keystone opportunity expansion zone. A proposed
3 expansion subzone may not overlap the boundaries of a subzone.
4 (c) Application limitation.--A political subdivision may
5 submit only one application to the department for authorization
6 as a keystone opportunity zone. A political subdivision may
7 submit only one application to the department for authorization
8 as a keystone opportunity expansion zone. A political
9 subdivision may submit only one application to the department
10 for designation of enhancements to existing keystone opportunity
11 zones and keystone opportunity expansion zones. If a political
12 subdivision seeks to enhance its existing keystone opportunity
13 zone under section 3511(f) (relating to keystone opportunity
14 zones) or a keystone opportunity expansion zone under section
15 3512(e) (relating to keystone opportunity expansion zones) and
16 the Governor has designated an improvement subzone located
17 within the political subdivision under section 3513(b) (relating
18 to keystone opportunity improvement zones), the political
19 subdivision must submit one application containing both the
20 request required by section 3511(f) or 3512(e) and the
21 application required by section 3513(c).
22 § 3515. Review.
23 (a) Action of department.--The department, in consultation
24 with the Department of Revenue, shall review all completed
25 applications submitted under this chapter. An application for
26 authorization as a keystone opportunity zone and designation of
27 subzones must be received by the department by September 30,
28 1998, in order to be considered by the department. An
29 application for authorization as a keystone opportunity
30 expansion zone and designation of expansion subzones must be
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1 received by the department by February 28, 2001, in order to be
2 considered by the department. An application for enhancement of
3 an existing keystone opportunity zone or of a keystone
4 opportunity expansion zone must be received by the department by
5 December 31, 2003.
6 (b) Process.--The department shall authorize up to 12
7 keystone opportunity zones from applications meeting the
8 criteria in section 3516 (relating to criteria for authorization
9 of keystone opportunity zone), based upon need and likelihood of
10 success. The department shall authorize up to 12 keystone
11 opportunity expansion zones from applications meeting the
12 criteria in section 3516, based upon need and likelihood of
13 success. Additionally, the department shall not alter the
14 geographic boundaries of a subzone or expansion subzone or the
15 duration of a subzone or expansion subzone described in an
16 application. The department shall designate additional
17 enhancements to existing keystone opportunity zones and keystone
18 opportunity expansion zones from applications meeting the
19 criteria in section 3516 based upon need and likelihood of
20 success.
21 (c) Authorizations.--The department shall authorize all
22 keystone opportunity zones by November 30, 1998. The department
23 shall authorize all keystone opportunity expansion zones by
24 March 30, 2001. The department shall designate all enhancements
25 to existing keystone opportunity zones and to keystone
26 opportunity expansion zones by January 31, 2004.
27 (d) Effective date of designation.--The designation of a
28 subzone under this chapter shall take effect on January 1, 1999.
29 The designation of an expansion subzone under this chapter shall
30 take effect on January 1, 2001. The designation of enhancements
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1 to existing keystone opportunity zones and to keystone
2 opportunity expansion zones under this chapter shall take effect
3 January 1, 2004.
4 (e) Extension.--The department may extend the deadline for
5 the receipt of applications for keystone opportunity zones until
6 December 31, 1998, if all 12 zones have not been authorized and
7 the extension is necessary to allow eligible political
8 subdivisions to apply. The department shall authorize additional
9 keystone opportunity zones under this subsection by February 28,
10 1999. The authorization shall take effect January 1, 1999; or,
11 if the authorization occurs after January 1, 1999, that
12 subsequent authorization shall for all purposes be retroactive
13 to January 1, 1999. The keystone opportunity zone authorization
14 shall end as provided in section 3511(b) (relating to keystone
15 opportunity zones).
16 § 3516. Criteria for authorization of keystone opportunity
17 zone.
18 (a) Specific criteria.--In order to qualify for
19 authorization under this chapter, the proposed keystone
20 opportunity zone or proposed keystone opportunity expansion zone
21 must meet at least two of the following criteria:
22 (1) At least 20% of the population is below the poverty
23 level.
24 (2) The unemployment rate is 1.25 times the Statewide
25 average.
26 (3) At least 20% of all real property within a five-mile
27 radius of the proposed keystone opportunity zone, proposed
28 keystone opportunity expansion zone, proposed subzone or
29 proposed expansion subzone in a nonurban area is deteriorated
30 or underutilized.
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1 (4) At least 20% of all real property within a one-mile
2 radius of the proposed keystone opportunity zone, proposed
3 keystone opportunity expansion zone, proposed subzone or
4 proposed expansion subzone in an urban area is deteriorated
5 or underutilized.
6 (5) At least 20% of all occupied housing within a two-
7 mile radius of the proposed keystone opportunity zone,
8 proposed keystone opportunity expansion zone, proposed
9 subzone or proposed expansion subzone in a nonurban area is
10 deteriorated.
11 (6) At least 20% of all occupied housing within a one-
12 mile radius of the proposed keystone opportunity zone,
13 proposed keystone opportunity expansion zone, proposed
14 subzone or proposed expansion subzone in an urban area is
15 deteriorated.
16 (7) In an urban area, the median family income is 80% or
17 less of the urban median family income for that metropolitan
18 statistical area.
19 (8) In an area other than an urban area, the median
20 family income is 80% or less of the Statewide nonurban median
21 family income.
22 (9) The population loss exceeds 10% in an area that
23 includes the proposed keystone opportunity zone or proposed
24 keystone opportunity expansion zone and its surrounding area
25 but is not larger than the county or counties in which the
26 proposed keystone opportunity zone or proposed keystone
27 opportunity expansion zone is located, based on census data
28 for the period between 1980 and 1990 or census estimates
29 since 1990 establishing a pattern of population loss.
30 (10) The political subdivision in which the proposed
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1 keystone opportunity zone or proposed keystone opportunity
2 expansion zone is located has experienced a sudden or severe
3 job loss.
4 (11) At least 33% of the real property in a proposed
5 keystone opportunity zone or proposed keystone opportunity
6 expansion zone in a nonurban area would otherwise remain
7 underdeveloped or nonperforming due to physical
8 characteristics of the real property.
9 (12) The area has substantial real property with
10 adequate infrastructure and energy to support new or expanded
11 development.
12 (b) Additional criteria.--In addition to the required
13 criteria under subsection (a), the department shall consider the
14 following criteria:
15 (1) Evidence of distress, including unemployment,
16 percentage of population below 80% of the State median
17 income, poverty rate, deteriorated property and adverse
18 economic and socioeconomic conditions, in the proposed
19 keystone opportunity zone or proposed keystone opportunity
20 expansion zone.
21 (2) The strength and viability of the proposed goals,
22 objectives and strategies, in the opportunity plan.
23 (3) Whether the opportunity plan is creative and
24 innovative in comparison to other applications.
25 (4) Local public and private commitment to the
26 development of the proposed keystone opportunity zone or
27 proposed keystone opportunity expansion zone and the
28 potential cooperation of surrounding communities.
29 (5) Existing resources available to the proposed
30 keystone opportunity zone or proposed keystone opportunity
20030S0010B1501 - 72 -
1 expansion zone.
2 (6) How keystone opportunity zone or keystone
3 opportunity expansion zone authorization or economic
4 redevelopment relates to other current economic and community
5 development projects and to regional initiatives or programs.
6 (7) How the local regulatory burden will be eased for
7 businesses operating in the proposed keystone opportunity
8 zone or proposed keystone opportunity expansion zone.
9 (8) Proposals to implement educational opportunities and
10 improvements.
11 (9) Crime statistics and proposals to implement local
12 crime reduction measures.
13 (10) Proposals to establish and link job creation and
14 job training.
15 (c) Tax exemption ordinances.--An area shall not be
16 authorized as a keystone opportunity zone or a keystone
17 opportunity expansion zone unless, as a part of the application,
18 each political subdivision in which the proposed subzone or
19 proposed expansion subzone is to be located adopts and provides
20 a copy of an ordinance, resolution or other required action from
21 the governing body of each political subdivision that exempts or
22 provides deductions, abatements or credits to qualified persons
23 and qualified businesses from local taxes upon designation of
24 the area as a subzone or expansion subzone. All appropriate
25 ordinances and resolutions must be effective by January 1, 1999,
26 if designation as a subzone is granted. All appropriate
27 ordinances and resolutions must be effective on January 1, 2001,
28 if designation as an expansion subzone is granted. All
29 appropriate ordinances and resolutions must be effective January
30 1, 2004, if designation of enhancements to an existing keystone
20030S0010B1501 - 73 -
1 opportunity zone or to a keystone opportunity expansion zone are
2 granted. Except as provided in section 3521 (relating to
3 decertification), the resolution, ordinance or other required
4 action shall be binding and nonrevocable on the qualified
5 political subdivisions for the duration of the opportunity plan.
6 (d) Urban areas.--The department shall promulgate guidelines
7 that include the definition of "urban area" for the purposes of
8 receiving applications for authorization as a keystone
9 opportunity zone or keystone opportunity expansion zone.
10 § 3517. Zone limitations.
11 The department shall not authorize more than 12 keystone
12 opportunity zones within this Commonwealth. No subzone shall
13 encompass an entire political subdivision. The department shall
14 not authorize more than 12 keystone opportunity expansion zones
15 within this Commonwealth. No expansion subzones shall encompass
16 an entire political subdivision.
17 § 3518. Residency.
18 In order to qualify each year for the tax exemptions,
19 deductions, abatements or credits under Chapters 5 and 7 of the
20 Keystone Act, a person must be domiciled and must reside in a
21 subzone or expansion subzone for a period of 184 consecutive
22 days during each taxable year, which may begin on the date of
23 designation by the department or on the date the person first
24 resides within the subzone or expansion subzone.
25 § 3519. Qualified businesses.
26 (a) Qualifications.--In order to qualify each year for the
27 tax exemptions, deductions, abatements or credits under Chapters
28 5 and 7 of the Keystone Act, a business must own or lease real
29 property in a subzone, improvement subzone or expansion subzone
30 from which the business actively conducts a trade, profession or
20030S0010B1501 - 74 -
1 business. The qualified business must receive certification from
2 the department that the business is located and is in the active
3 conduct of a trade, profession or business, within the subzone,
4 improvement subzone or expansion subzone. The business must
5 obtain annual renewal of the certification from the department
6 to continue to qualify under this section.
7 (b) Relocation.--
8 (1) Any business that relocates from outside a subzone,
9 improvement subzone or expansion subzone into a subzone,
10 improvement subzone or expansion subzone shall not receive
11 any of the exemptions, deductions, abatements or credits set
12 forth in the Keystone Act unless that business either:
13 (i) increases full-time employment by at least 20%
14 in the first full year of operation within the subzone,
15 improvement subzone or expansion subzone; or
16 (ii) makes a capital investment in the property
17 located within a subzone, improvement subzone or
18 expansion subzone equivalent to 10% of the gross revenues
19 of that business in the immediately preceding calendar or
20 fiscal year.
21 (2) The department, in consultation with the Department
22 of Revenue, may waive or modify the requirements of this
23 subsection, as appropriate.
24 § 3520. Forms.
25 (a) Application forms.--Applications for authorization as a
26 keystone opportunity zone or keystone opportunity expansion zone
27 must be on forms prescribed by the department.
28 (b) Department assistance.--The department shall assist
29 political subdivisions in using the Internet as a tool for
30 encouraging new business development, including assisting
20030S0010B1501 - 75 -
1 political subdivisions in making available via the Internet
2 information, applications and other forms necessary under this
3 chapter or the Keystone Act.
4 § 3521. Decertification.
5 (a) Application.--One or more political subdivisions, or a
6 designee of one or more political subdivisions, may apply to the
7 department to decertify and remove the designation of
8 deteriorated property as part of a subzone, improvement subzone
9 or expansion subzone. The application must contain all of the
10 following:
11 (1) An identification of the property to be removed.
12 (2) A copy of an agreement which was supported by
13 consideration in which each entity which possesses an
14 interest in the real property to be removed, including any
15 holder of an option either to purchase the real estate or to
16 enter into a ground lease of the real estate or any other
17 leasehold interest in the real estate, waives the party's
18 right to any exemptions, deductions, abatements or credits
19 granted by the Keystone Act.
20 (3) A copy of a binding ordinance, resolution or other
21 governing document passed by the political subdivision
22 removing any exemptions, deductions, abatements or credits
23 set forth in Chapter 7 of the Keystone Act, effective upon
24 decertification by the department.
25 (b) Process.--The department may grant the request to
26 decertify and remove the property if completed applications have
27 been submitted by all qualified political subdivisions in which
28 the property is located.
29 CHAPTER 37
30 KEYSTONE INNOVATION ZONES
20030S0010B1501 - 76 -
1 Sec.
2 3701. Scope of chapter.
3 3702. Definitions.
4 3703. Keystone innovation zones.
5 3704. Assistance.
6 3705. Expansion subzone designation.
7 § 3701. Scope of chapter.
8 This chapter deals with keystone innovation zones.
9 § 3702. Definitions.
10 The following words and phrases when used in this chapter
11 shall have then meanings given to them in this section unless
12 the context clearly indicates otherwise:
13 "Department." The Department of Community and Economic
14 Development of the Commonwealth.
15 "Eligible property." Real property which is located within a
16 five-mile radius of an institution of higher education in a
17 rural setting and which is located within a one-mile radius of
18 an institution of higher education in an urban setting.
19 "Institution of higher education." A public or private
20 institution within this Commonwealth authorized by the
21 Department of Education to grant an associate degree or higher
22 academic degree.
23 "Keystone innovation zone." A clearly defined geographic
24 area comprised of eligible property designated by the Department
25 of Community and Economic Development.
26 "Qualified employer." An entity that meets all of the
27 following:
28 (1) Is located within a keystone innovation zone.
29 (2) Employs three or more individuals within the
30 keystone innovation zone.
20030S0010B1501 - 77 -
1 (3) Has been in operation seven years or less.
2 "Secretary." The Secretary of Community and Economic
3 Development of the Commonwealth.
4 § 3703. Keystone innovation zones.
5 (a) Establishment.--There is hereby established within the
6 department a program to be known as the keystone innovation
7 zones program. The program shall provide economic assistance in
8 areas surrounding institutions of higher education.
9 (b) Application.--On or before January 1, 2005, an
10 institution of higher education may submit to the department an
11 application to establish a keystone innovation zone. The
12 application shall be on a form provided by the department and
13 shall include all of the following:
14 (1) A list of which eligible properties are to be
15 included in the keystone innovation zone.
16 (2) The name and address of the keystone innovation
17 zone.
18 (3) The name and address of the coordinator or executive
19 director of the keystone innovation zone.
20 (4) Any other information required by the department.
21 (c) Review and designation.--The department shall review the
22 application. Upon being satisfied that the application is
23 complete and accurate, the department may approve the
24 application. If the department approves the application, the
25 secretary shall designate the property as a keystone innovation
26 zone.
27 § 3704. Assistance.
28 (a) Existing programs.--A qualified employer shall be given
29 priority consideration in applying for assistance under any of
30 the programs established by:
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1 (1) This part and Part IV (relating to economic
2 development financing).
3 (2) The act of May 17, 1956 (1955 P.L.1609, No.537),
4 known as the Pennsylvania Industrial Development Authority
5 Act.
6 (3) The act of August 23, 1967 (P.L.251, No.102), known
7 as the Economic Development Financing Law.
8 (4) The act of June 22, 2001 (P.L.569, No.38), known as
9 the Ben Franklin Technology Development Authority Act.
10 (5) The act of June 26, 2001 (P.L.755, No.77), known as
11 the Tobacco Settlement Act.
12 (b) Loans.--A qualified employer with a project approved for
13 financing under this part, Part IV or by the Pennsylvania
14 Industrial Development Authority shall receive the lowest
15 interest rate extended to borrowers.
16 (c) Grants.--The department may provide a one-time $250,000
17 grant to a keystone innovation zone to establish and implement
18 the zone. The grant shall be drawn down as needed over a period
19 not to exceed the first five years of authorization as a
20 keystone innovation zone. Grant recipients shall comply with the
21 provisions of the grant.
22 § 3705. Expansion subzone designation.
23 (a) Establishment.--Notwithstanding sections 301.1, 303 and
24 304 of the act of October 6, 1998 (P.L 705, No.92), known as the
25 Keystone Opportunity Zone and Keystone Opportunity Expansion
26 Zone Act, and within one year of being designated a keystone
27 innovation zone under this chapter, a keystone innovation zone
28 may apply to the department to be designated as an expansion
29 subzone under the Keystone Opportunity Zone and Keystone
30 Opportunity Expansion Zone Act. The application shall be on a
20030S0010B1501 - 79 -
1 form provided by the department. In addition to the completed
2 application, the keystone innovation zone shall submit a copy of
3 an ordinance, resolution or other required action from the
4 governing body of each of the political subdivisions located
5 within the keystone innovation zone which exempts or provides
6 the deductions, abatements or credits required by Chapter 7 of
7 the Keystone Opportunity Zone and Keystone Opportunity Expansion
8 Zone Act to qualified persons and qualified businesses within
9 the keystone innovation zone as those terms are defined within
10 that act. The department may approve the application and
11 designate the property located within the keystone innovation
12 zone as an expansion subzone for the period beginning on the
13 date of designation and ending on December 31, 2013. Qualified
14 persons and qualified businesses within the expansion subzone
15 shall be entitled to the State tax exemptions, deductions,
16 abatements or credits set forth in Chapter 5 of the Keystone
17 Opportunity Zone and Keystone Opportunity Expansion Zone Act and
18 the local tax exemptions, deductions, abatements or credits set
19 forth in Chapter 7 of the Keystone Opportunity Zone and Keystone
20 Opportunity Expansion Zone Act for the period for which the
21 expansion subzone has been designated.
22 (b) Construction.--A keystone innovation zone designated an
23 expansion subzone under this section shall be subject to the
24 requirements of the Keystone Opportunity Zone and Keystone
25 Opportunity Expansion Zone Act.
26 PART IV
27 ECONOMIC DEVELOPMENT FINANCING
28 Chapter
29 41. Pennsylvania Industrial Development Authority (Reserved)
30 43. Pennsylvania Economic Development Financing Authority
20030S0010B1501 - 80 -
1 45. Local Economic Development Financing Authority
2 (Reserved)
3 47. Pennsylvania Infrastructure Investment Authority
4 (Reserved)
5 CHAPTER 41
6 PENNSYLVANIA INDUSTRIAL DEVELOPMENT AUTHORITY
7 (RESERVED)
8 CHAPTER 43
9 PENNSYLVANIA ECONOMIC DEVELOPMENT FINANCING AUTHORITY
10 Subchapter
11 A. General Provisions
12 B. Structure and Powers
13 C. Bonds
14 D. Programs
15 E. Miscellaneous
16 SUBCHAPTER A
17 GENERAL PROVISIONS
18 Sec.
19 4301. Scope of chapter.
20 4302. Definitions.
21 § 4301. Scope of chapter.
22 This chapter relates to the Pennsylvania Economic Development
23 Financing Authority.
24 § 4302. Definitions.
25 The following words and phrases when used in this chapter
26 shall have the meaning given to them in this section unless the
27 context clearly indicates otherwise:
28 "Acquisition." The act of acquiring or equipping a project.
29 The term includes installation of equipment.
30 "Agricultural production." The raising, preparing or
20030S0010B1501 - 81 -
1 marketing of crops, livestock or other related farm products.
2 "Applicant." A person that applies for financial assistance
3 in accordance with this chapter.
4 "Authority." The Pennsylvania Economic Development Financing
5 Authority created in section 4303 (relating to authority).
6 "Board." The board of Pennsylvania Economic Development
7 Financing Authority created in accordance with section 4304
8 (relating to board).
9 "Business site infrastructure." Tangible personal property
10 which is purchased and used to construct utility services and to
11 provide access to a location within the Commonwealth to be used
12 by a business. The term includes electric lines, water
13 pipelines, wastewater facilities and pipelines,
14 telecommunications lines, natural gas pipelines and roads. The
15 term does not include working capital, buildings or land except
16 those acquired to provide utilities or access to the location.
17 "Committee." The Project Review Committee established in
18 section 4303 (relating to authority).
19 "Construction." The act of erecting, reconstructing,
20 expanding, extending, improving, rehabilitating, remodeling,
21 renovating or repairing a building or structure employed in or
22 related to a project.
23 "Cost of the project." An expense associated with a project.
24 The term includes all of the following:
25 (1) Costs and expenses of acquisition of interests in
26 real estate, buildings, structures, equipment, furnishings
27 and other tangible or intangible property comprising the
28 project.
29 (2) Costs and expenses of construction of buildings and
30 structures.
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1 (3) Costs and expenses of demolishing, removing or
2 relocating any buildings or structures on lands acquired or
3 to be acquired, including the cost or expense of acquiring
4 any lands onto which buildings or structures may be moved or
5 relocated.
6 (4) Financing charges and other costs and expenses of
7 financing and issuing bonds.
8 (5) Interest expenses prior to and during construction
9 and for a period of 12 months after construction is
10 completed, including any reserves for interest and such other
11 expenses as may be necessary or incidental to the
12 development, implementation or use of the project and
13 placement of the same in operation.
14 (6) Costs and expenses of administrative expenses and
15 professional services, including the costs of engineering,
16 financial services, accounting and legal services.
17 (7) Costs and expenses associated with the preparation
18 of plans, specifications, studies, surveys necessary or
19 incidental to determining the feasibility or practicability
20 of constructing the project.
21 (8) Operating capital or other capital needs related to
22 the project subject to limitation by the authority.
23 "Department." The Department of Community and Economic
24 Development of the Commonwealth.
25 "Economic Enhancement Fund." The Economic Enhancement Fund
26 established in 72 Pa.C.S. § 7203 (relating to establishment).
27 "Federal agency." The President of the United States of
28 America; the Congress and any department, agency or
29 instrumentality of the government of the United States of
30 America.
20030S0010B1501 - 83 -
1 "Infrastructure." Tangible personal property which is
2 purchased and used in creation or provision of goods or
3 services. The term does not include working capital, buildings,
4 structures or land.
5 "Interagency project." A project which meets the definition
6 of project under the provisions of the act of March 1, 1988
7 (P.L.82, No.16), known as the Pennsylvania Infrastructure
8 Investment Authority Act.
9 "Local economic development agency." An entity certified as
10 an industrial development agency under the act of May 17, 1956
11 (1955 P.L.1609, No.537), known as the Pennsylvania Industrial
12 Development Authority Act.
13 "Local economic development financing authority." An entity
14 created under the act of August 23, 1967 (P.L.251, No.102),
15 known as the Economic Development Financing Law.
16 "Manufacturer." An entity which is engaged in the giving of
17 new shapes, new qualities or new combinations to matter by the
18 application of skill and labor.
19 "Medical facility." A private entity licensed as a medical
20 facility under the act of June 13, 1967 (P.L.31, No.21), known
21 as the Public Welfare Code, or under the act of July 19, 1979
22 (P.L.130, No.48), known as the Health Care Facilities Act.
23 "Medical infrastructure." Tangible personal property which
24 is purchased and used by a medical facility in providing patient
25 care. The term does not include working capital, buildings,
26 structures or land.
27 "Municipal authority." A public authority created under 53
28 Pa.C.S. Ch. 56 (relating to municipal authorities) or under the
29 former act of May 2, 1945 (P.L.382, No.164), known as the
30 Municipality Authorities Act of 1945.
20030S0010B1501 - 84 -
1 "Project." An activity which increases economic activity
2 within this Commonwealth. The term includes the acquisition of
3 real or personal property, whether tangible or intangible.
4 "Project user." A person that owns, leases or uses all or
5 any part of a project.
6 "Water and wastewater infrastructure." Real property or
7 tangible personal property which is part of a publicly owned
8 facility or system:
9 (1) for the collection, treatment or disposal of sewage
10 and wastewater, including industrial waste; or
11 (2) for the supply, treatment, storage or distribution
12 of drinking water.
13 SUBCHAPTER B
14 STRUCTURE AND POWERS
15 Sec.
16 4303. Authority.
17 4304. Board.
18 4305. Powers and duties.
19 § 4303. Authority.
20 (a) Establishment.--There is hereby established a public
21 authority to be known as the Pennsylvania Economic Development
22 Financing Authority. The authority shall be an instrumentality
23 of the Commonwealth and a body corporate and politic which shall
24 assist persons in funding industrial and commercial development
25 within this Commonwealth.
26 (b) Governance.--The powers and duties of the authority
27 shall be exercised by a board.
28 (c) Committee.--There is hereby established a committee to
29 be known as the Project Review Committee. The committee shall
30 review and recommend certain projects to the board. The
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1 committee shall be composed of the following five members:
2 (1) The Governor or the Secretary of the Budget.
3 (2) The Majority Leader of the Senate, or a designee.
4 (3) The Minority Leader of the Senate, or a designee.
5 (4) The Majority Leader of the House of Representatives,
6 or a designee.
7 (5) The Minority Leader of the House of Representatives,
8 or a designee.
9 The Governor or the Secretary of the Budget shall serve as
10 chairperson. The committee shall meet at the call of the
11 chairperson. Four members shall constitute a quorum, and the
12 consent of four members of the committee shall be required to
13 award a grant or recommend a loan for a project.
14 (d) Revenues.--Expenses of the authority shall be paid from
15 assets or income of the authority. Except as provided in this
16 chapter, the Commonwealth shall not be responsible for funding
17 the annual budget of the authority.
18 (e) Fiscal year.--The fiscal year of the authority shall be
19 the same as the fiscal year of the Commonwealth.
20 (f) Audit.--The authority shall conduct an independent audit
21 of its accounts and records annually.
22 (g) General Assembly review.--
23 (1) The Appropriations Committee of the Senate and the
24 Appropriations Committee of the House of Representatives
25 shall have the right at any time to examine the books,
26 accounts and records of the authority.
27 (2) The authority shall file an annual report with the
28 Appropriations Committee of the Senate and the Appropriations
29 Committee of the House of Representatives. The report shall
30 include all of the following:
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1 (i) A copy of the authority's budget.
2 (ii) The total amount of debt service to become due
3 on authority bonds for the ensuing fiscal year, including
4 payments of interest and principal, maturity value or
5 sinking fund payments.
6 (iii) The amount, if any, due to any provider of any
7 credit or liquidity facility representing payments made
8 by the provider as provided in the applicable resolution
9 or trust indenture as a result of any previous failure of
10 the authority to make any payment provided for in the
11 applicable resolution or trust indenture, including any
12 related reasonable interest, fees or charges and interest
13 rate exchange agreements, interest rate cap and floor
14 agreements and other similar agreements which the
15 authority enters into to manage the interest costs of the
16 authority.
17 (iv) The amount, if any, required to restore a debt
18 service reserve fund and the resolution of the authority
19 establishing the fund.
20 (v) The amount, if any, required to be rebated to
21 the United States for continued Federal tax exemption for
22 bonds of the authority.
23 (h) Publication.--The authority shall annually publish a
24 concise financial statement in the Pennsylvania Bulletin.
25 (i) Funds of authority.--
26 (1) The authority may create funds and accounts
27 necessary or desirable for its corporate purposes and shall
28 pay into each fund or account any money of the authority
29 available. No other provision of this chapter shall be
30 construed to prohibit the authority from creating within any
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1 fund one or more accounts which may be used or pledged by the
2 authority for a special purpose.
3 (2) All funds of the authority received from any source
4 shall be delivered to or upon the order of the treasurer of
5 the authority or to such other agent of the authority as the
6 board may designate. Funds received by the authority shall be
7 promptly deposited in a bank or banks in this Commonwealth
8 chosen by the board. The money in the accounts of the
9 authority may be paid by the treasurer of the authority or
10 other designated agent of the authority on warrant of the
11 treasurer of the authority. All deposits of money may, if
12 required by the authority, be secured by obligations of the
13 United States or of the Commonwealth of a market value equal
14 at all times to the amount of the deposit, and all banks and
15 trust companies are authorized to give security for such
16 deposits.
17 (3) Subject to the provisions of any agreements with
18 obligees of the authority, all funds of the authority,
19 including the proceeds from the sale of bonds, which are not
20 required for immediate use may be invested in obligations of
21 the Federal Government or of the Commonwealth or other
22 obligations which are legal investments for Commonwealth
23 funds.
24 (j) Termination.--The authority may, with the approval of
25 the Governor, terminate one year after all of its liabilities
26 have been fully paid and discharged. Upon the termination, all
27 of its rights and properties, including funds remaining in the
28 debt service reserve fund, shall be paid to the Commonwealth.
29 (k) Applicability.--The following acts shall apply to the
30 board:
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1 (1) The act of June 21, 1957 (P.L.390, No.212), referred
2 to as the Right-to-Know Law.
3 (2) The act of July 19, 1957 (P.L.1017, No.451), known
4 as the State Adverse Interest Act.
5 (3) The provisions of 65 Pa.C.S. Chs. 7 (relating to
6 open meetings) and 11 (relating to ethics standards and
7 financial disclosure).
8 § 4304. Board.
9 (a) Composition.--The board of the authority shall be
10 composed of the following 15 members:
11 (1) The Secretary of Community and Economic Development.
12 (2) The Secretary of the Budget.
13 (3) The Secretary of Labor and Industry.
14 (4) The Secretary of Agriculture.
15 (5) The Secretary of Banking.
16 (6) One member appointed by the Majority Leader of the
17 Senate, or a designee; one member appointed by the Minority
18 Leader of the Senate, or a designee; one member appointed by
19 the Majority Leader of the House of Representatives, or a
20 designee; and one member appointed by the Minority Leader of
21 the House of Representatives, or a designee. Legislative
22 appointments shall serve at the pleasure of the appointing
23 authority.
24 (7) Six members of the public with experience in finance
25 or management appointed, with the advice and consent of the
26 Senate, by the Governor.
27 (b) Term.--The members of the board appointed by the
28 Governor shall serve for a term of three years.
29 (c) Organization.--The Secretary of Community and Economic
30 Development shall serve as chairperson. The members of the board
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1 shall elect from among themselves a vice chairperson, secretary,
2 treasurer and any other officers as they may determine.
3 (d) Meetings.--The board shall meet at the call of the
4 chairperson but shall meet at least once each month.
5 (e) Quorum.--Eleven members of the board shall constitute a
6 quorum for the transaction of any authority business. The
7 consent of at least ten members of the board shall be necessary
8 to transact business on behalf of the authority.
9 (f) Expenses.--A member of the board shall not receive
10 compensation or remuneration, but shall be entitled to
11 reimbursement for all reasonable and necessary actual expenses.
12 (g) Public officials and party officers.--The members of the
13 board appointed by the Governor shall not seek or hold a
14 position as a public official within this Commonwealth or as a
15 party officer while being a member of the board.
16 (h) Liability.--Members of the board and the committee shall
17 not be liable personally on any obligations of the authority,
18 including, without limitation, bonds of the authority and shall
19 be immune from suit.
20 § 4305. Powers and duties.
21 (a) Powers.--The authority, through action of the board,
22 shall have all of the following powers:
23 (1) The power to adopt bylaws and guidelines as it deems
24 necessary.
25 (2) The power to contract and to execute instruments,
26 including financing agreements, letters of credit,
27 guarantees, sureties, mortgages, loans, standby loan
28 commitments and contracts of insurance, which are necessary
29 or convenient for the carrying on of its business.
30 (3) The power to sue and be sued, implead and be
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1 impleaded, complain and defend in court.
2 (4) The power to borrow money, obtain lines and letters
3 of credit, incur debt and, in anticipation of the receipt of
4 income of the authority, make, issue and secure taxable and
5 tax-exempt bonds or notes, including limited obligation
6 revenue bonds.
7 (5) The power to acquire, accept, purchase, receive,
8 collect, hold, convey and invest funds, fees and property,
9 whether tangible or intangible, from all sources, directly or
10 by assignment, pledge or otherwise.
11 (6) The power to sell, transfer, convey and dispose of
12 any property, tangible or intangible.
13 (7) The power to adopt, use and alter at will a
14 corporate seal.
15 (8) The power to employ an executive director and such
16 other persons as are necessary or convenient for the carrying
17 on of its business.
18 (9) The power to retain counsel and auditors to render
19 professional services as the authority deems appropriate.
20 (10) The power to pledge the credit of the authority and
21 to provide security and liquidity as may be required by
22 creditors.
23 (11) The power to cooperate with any Federal agency or
24 Commonwealth agency.
25 (12) Any other power necessary or convenient for the
26 promotion or general welfare of the authority.
27 (b) Duties.--The authority shall provide financial
28 assistance to applicants for projects. The financial assistance
29 shall be in the form of loans or single-year or multiyear grants
30 and may include proceeds from the sale of bonds. Prior to
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1 providing funds to an applicant, the authority shall enter into
2 a contract with the applicant. The contract shall include all of
3 the following:
4 (1) A provision requiring the applicant to repay any
5 grant made under this chapter from any proceeds resulting
6 from a sale or partial sale of the project by the applicant.
7 Grants shall be repaid in accordance with the following:
8 (i) If the project is sold less than two years after
9 receipt of the grant, the applicant shall pay to the
10 authority 90% of the grant received.
11 (ii) If the project is sold more than two years but
12 less than four years after receipt of the grant, the
13 applicant shall pay to the authority 80% of the grant
14 received.
15 (iii) If the project is sold more than four years
16 but less than six years after receipt of the grant, the
17 applicant shall pay to the authority 70% of the grant
18 received.
19 (iv) If the project is sold more than six years but
20 less than eight years after receipt of the grant, the
21 applicant shall pay to the authority 60% of the grant
22 received.
23 (v) If the project is sold more than eight years but
24 less than ten years after receipt of the grant, the
25 applicant shall pay to the authority 50% of the grant
26 received.
27 (2) Any other terms or conditions on the financial
28 assistance authorized by this chapter as the board determines
29 to be in the best interests of the Commonwealth.
30 (c) Limitations.--
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1 (1) In accordance with section 8 of Article VIII of the
2 Constitution of Pennsylvania, the board and the authority
3 shall have no power to pledge the credit or taxing powers of
4 the Commonwealth or of a political subdivision or other
5 instrumentality of the Commonwealth, nor, except as provided
6 in this chapter, shall any of the bonds of the authority be
7 deemed a debt or liability of the Commonwealth or a political
8 subdivision or instrumentality of the Commonwealth.
9 (2) Except as provided in this chapter, the authority
10 shall be solely liable for the payment of the principal,
11 interest or premium on any bonds issued by the authority.
12 Except as provided in this chapter, the Commonwealth or a
13 political subdivision or instrumentality of the Commonwealth
14 shall have no legal or moral obligation for the payment of
15 any expenses or obligations of the authority, including bond
16 principal and interest, the funding or refunding of any
17 reserves and any administrative or operating expenses
18 whatsoever. Bonds issued by the authority shall contain a
19 prominent statement of the limitations set forth in this
20 subsection and shall further recite that obligees of the
21 authority shall have no recourse, either legal or moral, to
22 the Commonwealth or a political subdivision or
23 instrumentality of the Commonwealth for payment of the bonds
24 of the authority.
25 SUBCHAPTER C
26 BONDS
27 Sec.
28 4306. Bonds issuances.
29 4307. Commonwealth taxation.
30 4308. Federal taxation.
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1 4309. Validity of bonds; limitation on actions.
2 4310. Provisions of bonds; trust indentures.
3 4311. Remedies of obligee of authority.
4 4312. Validity of pledge.
5 4313. Commonwealth pledges.
6 4314. Resolution and law are contracts with holders of bonds.
7 4315. Bonds to be legal investments.
8 4316. Right to enforcement of pledge of revenues.
9 4317. Debt service reserve fund.
10 4318. Debt service funds.
11 § 4306. Bonds issuances.
12 (a) Authorization.--
13 (1) Bonds of the authority, whether taxable or tax
14 exempt, shall be authorized by a resolution of the board and
15 shall be of a series, bear such date or dates and bear or
16 accrue interest at the rate or rates determined by the board
17 to be necessary to issue and sell the authorized bonds.
18 (2) The bonds shall:
19 (i) be in the denominations;
20 (ii) be in the form, either coupon or fully
21 registered without coupons or in certificated or book-
22 entry-only form;
23 (iii) carry such registration, exchangeability and
24 interchangeability privileges;
25 (iv) be payable in the medium of payment and at such
26 place or places;
27 (v) be subject to the terms of redemption; and
28 (vi) be entitled to the priorities of payment in the
29 revenues or receipts of the authority as the board
30 provides by resolution.
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1 (3) Bonds shall be signed by or shall bear the facsimile
2 signatures of the officer designated by the board.
3 (4) Interest coupons shall be attached to coupon bonds
4 and shall bear the facsimile signature of the treasurer of
5 the authority.
6 (5) Bonds shall be authenticated by an authenticating
7 agent, fiscal agent or trustee.
8 (6) Bonds may be issued and delivered notwithstanding
9 that the officer signing the bonds or the treasurer whose
10 facsimile signature is on a coupon shall have ceased to be
11 the officer at the time when the bond is actually delivered.
12 (b) Maturity date.--
13 (1) Except as provided in paragraph (2), bonds issued to
14 finance the costs of a project shall mature at a time or
15 times not exceeding the weighted average useful life of the
16 projects being financed and in no event exceeding 30 years
17 from their respective dates of original issue.
18 (2) Bonds issued in anticipation of income of the
19 authority shall mature within the fiscal year of the date of
20 issuance thereof, except for bonds issued in anticipation of
21 a grant or appropriation from the Commonwealth, a
22 Commonwealth agency or a Federal agency, which bonds shall
23 mature no later than the time of anticipated receipt of the
24 grant or appropriation.
25 (c) Sale.--Bonds may be sold at public sale or invited sale
26 for the price or prices and at the rate or rates of interest as
27 the authority determines. Bonds may be sold at private sale by
28 negotiation at the price or prices and at the rate or rates of
29 interest as the authority determines, but only if the authority
30 makes a written public explanation of the circumstances and
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1 justification for the private sale by negotiation. Pending the
2 preparation of the definitive bonds, interim receipts may be
3 issued to the purchaser or purchasers of the bonds and shall
4 contain the terms and conditions established by the authority.
5 The authority shall ensure that minority-owned or minority-
6 controlled firms shall have a opportunity to participate in a
7 significant way in any bond sale activities.
8 (d) Negotiable instruments.--Bonds of the authority shall
9 have the qualities of negotiable instruments under 13 Pa.C.S.
10 (relating to commercial code).
11 (e) Use of proceeds.--The proceeds of an issue of bonds may
12 be used for any of the following:
13 (1) To pay the costs of issuance of the bonds.
14 (2) To fund reserves for the bond.
15 (3) To capitalize interest on the bonds for a period not
16 to exceed 12 months.
17 (4) To pay costs of administration of the authority.
18 (5) To make grants in accordance with sections 4321
19 (relating to Water and Wastewater Infrastructure
20 Capitalization Program) and 4324 (relating to Economic
21 Enhancement Financing Program).
22 (6) To make loans in accordance with sections 4319
23 (relating to the Infrastructure Development Program), 4320
24 (relating to Core Industries Infrastructure Capitalization
25 Program), 4321, 4322 (relating to Business in Our Sites
26 Program), 4323 (relating to First Industries Program), 4324
27 and 4325 (relating to Secondary Growth Stage Financing
28 Program).
29 (7) To purchase loans, mortgages, security interests or
30 loan participations agreements which the authority determines
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1 is in its best interest.
2 (f) Refunding.--Subject to provisions of this chapter and
3 bonds, notes or other obligations issued in accordance with this
4 chapter, the authority may refund any outstanding debt of the
5 authority, whether the debt represents principal or interest, in
6 whole or in part, at any time. For the purposes of this
7 subsection, the term "refund" and its variations shall mean the
8 issuance and sale of obligations the proceeds of which are used
9 or are to be used for the payment or redemption of outstanding
10 obligations upon or prior to maturity. The term of any bonds
11 issued for refunding purposes shall not extend to a maturity
12 date which could not have been included in the original issue of
13 bonds being refunded.
14 § 4307. Commonwealth taxation.
15 The effectuation of Subchapter D (relating to programs) by
16 the authority shall and will be in all respects for the benefit
17 of the people of this Commonwealth, for the increase of their
18 commerce and prosperity and for the improvement of their health,
19 safety, welfare and living conditions. Since the authority will
20 be performing essential governmental functions in effectuating
21 such purposes, the authority shall not be required to pay any
22 taxes or assessments upon any property acquired or used or
23 permitted to be used by the authority for its purposes, and the
24 bonds issued by the authority, their transfer and the income
25 therefrom, including any profits made on their sale, shall at
26 all times be free from State and local taxation within this
27 Commonwealth. This exemption shall not extend to gift, estate,
28 succession or inheritance taxes or any other taxes not levied
29 directly on the bonds, their transfer, the income therefrom or
30 the realization of profits on their sale.
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1 § 4308. Federal taxation.
2 (a) Allocation.--If the bonds issued by the authority for a
3 project are federally tax-exempt bonds for which Federal law
4 requires an allocation, the department shall, upon receipt of a
5 written request from the authority, issue an allocation charging
6 the project's pro rata share of the issue to the county in which
7 the project will be located.
8 (b) Approval.--If gubernatorial approval is required by a
9 Federal agency in order for a bond issue of the authority to
10 qualify for tax-exempt status, the Governor shall, upon receipt
11 of a written request from the authority, approve the bond issue.
12 The request shall state that the authority has conducted a
13 hearing in accordance with 65 Pa.C.S. Ch. 7 (relating to open
14 meetings) and shall contain a description of the project to be
15 financed, a summary of the method of financing and a summary of
16 the comments made and questions posed at the hearing.
17 § 4309. Validity of bonds; limitation on actions.
18 (a) Presumption.--A bond reciting in substance that it has
19 been issued by the authority to accomplish the public purposes
20 of this chapter shall be conclusively deemed in any suit, action
21 or proceeding involving the validity or enforceability of the
22 bonds or their security to have been issued for the public
23 purposes of this chapter.
24 (b) Filing.--
25 (1) The authority shall file a copy of a resolution
26 authorizing the issuance of bonds in its office for public
27 inspection and shall publish in three newspapers of general
28 circulation in this Commonwealth a notice stating:
29 (i) The fact and date of the resolution.
30 (ii) The places where the resolution has been filed
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1 for public inspection.
2 (iii) The date of publication of the notice.
3 (iv) Any action or proceeding of any kind or nature
4 in any court questioning the validity or proper
5 authorization of bonds provided for by the resolution or
6 the validity of any covenants, agreements or contract
7 provided for by the resolution shall be commenced within
8 ten days after the publication of the notice.
9 (2) If no action or proceeding questioning the validity
10 or proper authorization of bonds provided for by the
11 resolution referred to in the notice required under paragraph
12 (1) or questioning the validity of any covenant, agreement or
13 contract provided by the resolution is commenced within ten
14 days after the publication of the notice required under
15 paragraph (1):
16 (i) All persons shall be forever barred and
17 foreclosed from instituting or commencing any action or
18 proceeding in any court or pleading any defense to any
19 action or proceedings questioning the validity or proper
20 authorization of the bonds or the validity of the
21 covenants, agreements or contracts; and
22 (ii) the bonds, covenants, agreements and contracts
23 shall be conclusively deemed to be valid and binding
24 obligations in accordance with their terms and tenor.
25 (c) Estoppel.--After issuance, bonds shall be conclusively
26 presumed to be fully authorized and issued by all the laws of
27 this Commonwealth, and any person shall be estopped from
28 questioning their sale, execution or delivery by the authority.
29 § 4310. Provisions of bonds; trust indentures.
30 (a) Powers.--In connection with the issuance of bonds and in
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1 order to secure the payment of its bonds, the authority, in
2 addition to its other powers, shall have the power to do all of
3 the following:
4 (1) Pledge or grant a security interest in all or any
5 part of its gross or net revenues to which its right then
6 exists or which may later come into existence.
7 (2) Grant a security interest in all or any part of its
8 personal property then owned or later acquired.
9 (3) Covenant against:
10 (i) pledging or granting a security interest in all
11 or any part of its revenues or all or any part of its
12 personal property to which its right or title exists or
13 which may later come into existence; or
14 (ii) permitting or suffering any lien on its
15 revenues or property.
16 (4) Covenant with respect to limitations on its right to
17 sell, lease or otherwise dispose of any of its real property.
18 (5) Covenant as to which other or additional debts or
19 obligations may be incurred by it.
20 (6) Covenant as to the bonds to be issued and as to the
21 issuance of the bonds, in escrow or otherwise, and as to the
22 use and disposition of the proceeds thereof.
23 (7) Provide for the replacement of lost, destroyed or
24 mutilated bonds.
25 (8) Covenant against extending the time for the payment
26 of bonds or interest thereon.
27 (9) Redeem bonds.
28 (10) Covenant for their redemption and provide the terms
29 and conditions thereof.
30 (11) Covenant as to the amount of revenues to be
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1 received in each fiscal year or other period of time by the
2 authority and to the use and disposition to be made of the
3 revenues.
4 (12) Create or authorize the creation of special funds
5 or reserves for debt service or other purposes and covenant
6 as to the use and disposition of the money held in the
7 special funds.
8 (13) Prescribe the procedure, if any, by which the terms
9 of any contract with bondholders may be amended or abrogated,
10 the amount of bonds the holders of which must consent to and
11 the manner in which the consent may be given.
12 (14) Covenant as to the use of any or all of its real or
13 personal property to warrant its title.
14 (15) Covenant as to the maintenance of its real and
15 personal property, the replacement of its real and personal
16 property, the insurance to be carried on its real and
17 personal property and the use and disposition of insurance
18 proceeds.
19 (16) Covenant as to the rights, liabilities, powers and
20 duties arising upon the breach by it of any covenant,
21 condition or obligation, except that the authority shall not
22 be permitted to covenant that upon a breach any or all of its
23 bonds shall become or may be declared due before their stated
24 maturity.
25 (17) Pay the costs or expenses incident to:
26 (i) the enforcement of the bonds;
27 (ii) the provisions of the resolution authorizing
28 the issuance of the bonds;
29 (iii) the trust indenture securing the bonds; or
30 (iv) any covenant or agreement of the financing
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1 authority with the holders of the bonds, notes or other
2 obligations.
3 (18) Vest in a trustee or the holders of bonds or any
4 proportion of them the right to enforce the payment of the
5 bonds or any covenants securing or relating to the bonds.
6 (19) Vest in a trustee the right, in the event of
7 default in payments of interest or on principal of bonds by
8 the authority, to take possession and use, operate and manage
9 any real or personal property, to collect the revenues and
10 receipts of an authority and to dispose of the money in
11 accordance with the agreement of the authority with the
12 trustee.
13 (20) Provide for the:
14 (i) powers and duties of a trustee and to limit the
15 trustee's liabilities; and
16 (ii) terms and conditions upon which a trustee or
17 the holders of bonds or any proportion of them may
18 enforce any covenant or rights securing or relating to
19 the bonds.
20 (21) Enter into interest rate exchange agreements,
21 interest rate cap and floor agreements and other similar
22 agreements which in the judgment of the authority will assist
23 the authority in managing the interest costs of the
24 authority.
25 (22) Obtain letters of credit, bonds insurance and other
26 facilities for credit enhancement and liquidity.
27 (23) Exercise all or any part or combination of the
28 powers granted in this chapter.
29 (24) Make covenants other than and in addition to the
30 covenants expressly authorized by this chapter.
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1 (25) Make any other covenants and do any and all other
2 acts and things as may be necessary, convenient or desirable
3 in order to secure its bonds or, in the absolute discretion
4 of the authority, as will tend to accomplish the purposes of
5 this chapter by making the bonds more marketable,
6 notwithstanding that the covenants, acts or things may not be
7 specifically enumerated by this chapter.
8 (b) Limitations.--Notwithstanding any provision of this
9 chapter to the contrary, the real property of the authority
10 shall not be mortgaged and shall not be subject to attachment
11 nor levied upon by execution or otherwise. The revenues of the
12 authority and the personal property of the authority shall be
13 pledged or otherwise encumbered only as expressly provided in
14 this chapter and, except to the extent necessary to effectuate
15 the pledge or encumbrance, shall not be subject to attachment
16 nor levied upon by execution or otherwise.
17 § 4311. Remedies of obligee of authority.
18 In addition to all other rights which may be conferred on the
19 obligee subject only to any contractual restrictions binding
20 upon the obligee, an obligee of the authority shall have all of
21 the following rights:
22 (1) To compel, by mandamus, suit, action or proceeding
23 at law or in equity, the authority and the members of its
24 governing board, officers, agents or employees to perform
25 each and every term, provision and covenant contained in any
26 bond or contract of the authority with or for the benefit of
27 the obligee and to require the carrying out of any covenants
28 and agreements of the authority and the fulfillment of all
29 duties imposed upon the authority by this chapter.
30 (2) To obtain, by proceeding in equity, an injunction
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1 against any acts or things which may be unlawful or the
2 violation of any of the rights of the obligee.
3 (3) To require the authority to account as if it were
4 the trustee of an express trust for the obligees of the
5 authority for any pledged revenues received.
6 § 4312. Validity of pledge.
7 Any pledge of or grant of a security interest in revenues or
8 personal property of the authority made by the authority shall
9 be valid and binding from the time when the pledge is made. The
10 revenues or other property pledged and later received by the
11 authority shall immediately be subject to the lien of the pledge
12 or security interest without any physical delivery thereof or
13 further act. The lien of the pledge or security interest shall
14 be valid and binding as against all parties having claims of any
15 kind in tort, contract or otherwise against the authority
16 irrespective of whether the parties have notice. Neither the
17 resolution nor any other instrument of the authority by which a
18 pledge or security interest is created need be recorded or filed
19 to perfect the pledge or security interest.
20 § 4313. Commonwealth pledges.
21 (a) Bondholders.--The Commonwealth does hereby pledge to and
22 agree with each and every obligee of the authority that the
23 Commonwealth will not limit or alter the rights hereby vested in
24 the authority in any manner inconsistent with the obligations of
25 the authority to its obligees until all bonds at any time
26 issued, together with the interest on the bonds, are fully paid
27 and discharged.
28 (b) Lessees.--The Commonwealth does hereby pledge to and
29 agree with any person who, as owner of property that is leased
30 or subleased to or from the authority, that it will not limit or
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1 alter the rights and powers vested in the authority or otherwise
2 created by this chapter in any manner which impairs the
3 obligations of the authority until all the obligations of the
4 authority under the lease or sublease are fully met and
5 discharged.
6 § 4314. Resolution and law are contracts with holders of bonds.
7 Except as otherwise provided in any resolution of the
8 authority authorizing or awarding bonds, the terms of a
9 resolution and any agreement authorized by the resolution and
10 the terms of this chapter as in effect when the bonds were
11 authorized shall constitute a contract between the authority and
12 the obligees, subject to modification by the vote by holders of
13 the percentage of bonds as the resolution authorizing or
14 awarding the bonds provides.
15 § 4315. Bonds to be legal investments.
16 Bonds issued pursuant to this chapter are made securities in
17 which all government agencies, insurance companies, trust
18 companies, banking associations, banking corporations, savings
19 banks, investment companies, executors, the trustees of any
20 retirement, pension or annuity fund or system of the
21 Commonwealth, trustees and other fiduciaries may properly and
22 legally invest funds, including capital, deposits or other funds
23 in their control or belonging to them. The bonds are hereby made
24 securities which may properly and legally be deposited with and
25 received by any government agency for any purpose for which the
26 deposit of bonds or other obligations of the Commonwealth are
27 authorized by law.
28 § 4316. Right to enforcement of pledge of revenues.
29 The obligees of the authority shall have the right to enforce
30 a pledge of or security interest in revenues of the authority
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1 securing payment of bonds of the authority against all
2 government agencies in possession of any such revenues at any
3 time. The revenues may be collected directly from such officials
4 upon notice by the obligees or a trustee for the obligees for
5 application to the payment of the bonds as and when due or for
6 deposits in any sinking, bond or debt service fund established
7 in accordance with this chapter or established by resolution of
8 the authority with the trustee at the times and in the amounts
9 specified in the bonds or the resolution or indenture or trust
10 agreement securing the bonds. Any government agency in
11 possession of any such revenues shall make payment against
12 receipt and shall be discharged from any further liability or
13 responsibility for such revenues. If payment is made to a holder
14 of bonds, it shall be made against surrender of the bonds to the
15 payor for delivery to the authority in the case of payment in
16 full; otherwise, it shall be made against production of the
17 bonds for notation thereon of the amount of the payment. The
18 provisions of this section with respect to the enforceability
19 and collection of revenues which secure bonds shall supersede
20 any contrary or inconsistent statutory provision or rule of law.
21 This section shall be construed and applied to fulfill the
22 legislative purpose of clarifying and facilitating the financing
23 of the authority by assuring to the obligees of the authority
24 the full and immediate benefit of the security for the bonds
25 without delay, diminution or interference based on any statute,
26 decision, ordinance or administrative rule or practice.
27 § 4317. Debt service reserve fund.
28 (a) Authorization.--
29 (1) The authority may establish one or more debt service
30 reserve funds into which it shall deposit:
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1 (i) Proceeds from the sale of bonds, to the extent
2 provided in the resolution or resolutions authorizing the
3 bonds.
4 (ii) Any other money made available to the authority
5 from any source.
6 (2) All money held in any debt service reserve fund,
7 except as provided in this subsection, shall be used when
8 required solely for the:
9 (i) payment of the principal of bonds secured in
10 whole or in part by the fund;
11 (ii) payment of sinking fund payments, if any, with
12 respect to the bonds;
13 (iii) purchase or redemption of bonds;
14 (iv) payment of interest on bonds; or
15 (v) payment of any redemption premium required to be
16 paid when bonds and notes are redeemed prior to maturity.
17 (3) Any debt service reserve fund established pursuant
18 to this section shall be a trust fund held for the benefit
19 and security of the obligees of the authority whose bonds are
20 secured by the fund.
21 (4) Money in a debt service reserve fund shall not be
22 withdrawn from the fund at any time in an amount that would
23 reduce the amount of the fund to less than the minimum
24 reserve fund requirement established for the fund in the
25 resolution of the authority creating the fund, except for
26 withdrawals for the purpose of making payments when due of
27 principal, interest, redemption premiums and sinking fund
28 payments, if any, with respect to the bonds for the payment
29 of which other money of the authority are not available.
30 (5) Any income or interest earned by or increments to
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1 any debt service reserve fund due to the investment thereof
2 may be transferred by the authority to other funds or
3 accounts of the authority to the extent the transfer does not
4 reduce the amount of the debt service reserve fund below the
5 minimum reserve fund requirement established for that fund.
6 (6) Funds transferred to other accounts in accordance
7 with the requirements of paragraph (5) may be used for
8 whatever purposes the authority deems appropriate if the
9 purposes are consistent with this chapter and the contracts
10 of the authority with obligees of the authority.
11 (b) Bond limitation.--The authority shall not at any time
12 issue bonds secured in whole or in part by a debt service
13 reserve fund if issuance of the bonds would cause the amount in
14 the debt reserve fund to fall below the minimum reserve
15 requirement for the fund, unless the authority at the time of
16 issuance of the bonds shall deposit in the fund an amount, from
17 the proceeds of the bonds to be issued or from other sources,
18 which when added to the amount already in the fund will cause
19 the total amount on deposit in the fund to equal or exceed the
20 minimum reserve fund requirement.
21 (c) Definition.--For the purposes of this section, the term
22 "minimum reserve fund requirement" shall mean that amount
23 defined as the minimum reserve fund requirement in the
24 resolution of the authority authorizing the bonds.
25 § 4318. Debt service funds.
26 Any money deposited in any fund created by the authority to
27 be used to pay debt service, including, without limitation, the
28 bond payment account, any sinking fund or debt service reserve
29 fund and all investments and proceeds of investments thereof
30 shall, without further action or filing, be subjected to a
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1 perfected security interest for the obligees of the authority
2 for whom the fund is held until the money or investments shall
3 be properly disbursed in accordance with this chapter and with
4 the terms of the contract of the authority with its obligees.
5 SUBCHAPTER D
6 PROGRAMS
7 Sec.
8 4319. Infrastructure Development Program.
9 4320. Core Industries Infrastructure Capitalization Program.
10 4321. Water and Wastewater Infrastructure Capitalization
11 Program.
12 4322. Business in Our Sites Program.
13 4323. First Industries Program.
14 4324. Economic Enhancement Financing Program.
15 4325. Secondary Growth Stage Financing Program.
16 4326. Community Development Bank Program. (Reserved)
17 § 4319. Infrastructure Development Program.
18 (a) Establishment.--There is hereby established within the
19 authority a program to be known as the Infrastructure
20 Development Program. The program shall provide financial
21 assistance in the form of loans for projects which, when
22 completed, increase economic development within this
23 Commonwealth.
24 (b) Application.--A person may submit an application to the
25 authority requesting financial assistance for a project. The
26 application shall be on the form required by the authority and
27 shall include or demonstrate all of the following:
28 (1) The name and address of the applicant.
29 (2) A statement of the amount of finance assistance
30 sought.
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1 (3) A statement of the project, including a detailed
2 statement of the cost of the project.
3 (4) A firm financial commitment from a responsible
4 source for any cost of the project in excess of the amount
5 requested.
6 (5) A firm commitment from the applicant or project user
7 to use or lease the project upon completion.
8 (6) Any other information required by the authority.
9 (c) Additional requirements for certain projects.--If the
10 applicant is not a political subdivision, local economic
11 development agency or local economic development financing
12 authority, the applicant shall, in addition to the information
13 required by subsection (b), submit a copy of the document
14 verifying approval of the project by the appropriate local
15 economic development agency or local economic development
16 financing authority. If the applicant is requesting financial
17 assistance for a project which is an interagency project, the
18 applicant shall, in addition to the information required by
19 subsection (b), submit a copy of the document issued by the
20 Pennsylvania Infrastructure Investment Authority referring the
21 applicant to the authority for financial assistance. If the
22 applicant is not a municipality or municipal authority and is
23 requesting financial assistance for a project constructing or
24 improving transportation infrastructure, the applicant shall, in
25 addition to the information required by subsection (b), submit a
26 copy of the document verifying approval of the project by the
27 appropriate municipality or municipal authority or a
28 Commonwealth agency and a determination by the applicant that
29 financing the project through the authority will reduce the cost
30 of the project.
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1 (d) Local economic development agencies.--If the applicant
2 is a local economic development agency, in addition to the
3 information required by subsection (b), the applicant shall do
4 all of the following:
5 (1) Be incorporated under the laws of this Commonwealth.
6 (2) Agree to be bound by the rules of the authority
7 relating to projects which receive financial assistance under
8 this chapter.
9 (3) Agree to submit to examination of its books, records
10 and accounts by the authority at times as the authority may
11 require during the term of any loan made to it by the
12 authority.
13 (e) Local economic development financing authorities.--If
14 the applicant is a local economic development financing
15 authority, in addition to the information required by subsection
16 (b), the applicant shall do all of the following:
17 (1) Submit an application verified by the chairperson of
18 the local economic development financing authority and any
19 other information required by the authority, including any
20 application fee.
21 (2) Agree to be bound by the rules of the authority
22 relating to projects which receive financial assistance under
23 this chapter.
24 (3) Agree to submit to examination of its books, records
25 and accounts by the authority at times as the authority may
26 require during the term of any loan made to it by the
27 authority.
28 (f) Review.--Within 45 days of a completed application being
29 submitted, the board shall review the application to determine
30 all of the following:
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1 (1) If the financial commitment exists for any cost of
2 the project in excess of the amount requested.
3 (2) If the financial commitment from the source is firm.
4 (3) If the source of the financial commitment is
5 responsible.
6 (4) If the commitment to use or lease the project upon
7 completion is firm.
8 (5) If, in the case where the project will not be used
9 by the applicant, the project user may reasonably be expected
10 to comply with the terms of the use or lease.
11 (6) If the applicant satisfied the requirements of
12 subsections (c), (d) and (e), if applicable.
13 (7) If the project complies with all other rules and
14 regulations of the authority governing projects.
15 (g) Approval.--Upon being satisfied that all applicable
16 requirements have been met, the board may approve the
17 application. If the board approves the application, the board
18 shall enter into a contract with the applicant and finance the
19 loan.
20 (h) Applicability.--If a project of a local economic
21 development agency or a local economic development financing
22 authority has been approved for financing and the project is to
23 be financed with the proceeds of bonds which are not exempt from
24 Federal income taxation, the provisions of Chapter 27 of the act
25 of June 29, 1996 (P.L.434, No.67), known as the Job Enhancement
26 Act, shall not apply to the financing of the project.
27 (i) Limitations.--
28 (1) Except upon foreclosure or default or violation of a
29 loan made, the authority may not approve an application and
30 finance a project if the authority would be required to
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1 operate, service or maintain the project under a lease or
2 other agreement. Nothing in this paragraph shall prohibit the
3 authority from approving an application or financing a
4 project if, at the end of the term of a loan, the authority
5 transferred the project to the applicant, any project user or
6 a designee of either.
7 (2) The authority may not approve an application and
8 finance a project which is a public facility if the authority
9 determines that, if the project was financed by an entity
10 other than the authority, the project could receive a rating
11 of A or better from either Moodys Investors Service or
12 Standard & Poors Corporation.
13 § 4320. Core Industries Infrastructure Capitalization Program.
14 (a) Establishment.--There is established within the
15 authority a program to be known as the Core Industries
16 Infrastructure Capitalization Program. The program shall provide
17 financial assistance in the form of loans to all of the
18 following:
19 (1) To medical facilities for the acquisition or
20 construction of projects which, when completed, improve or
21 construct medical infrastructure directly related to patient
22 safety.
23 (2) To manufacturers for the acquisition or construction
24 of projects which, when completed, improve or construct
25 infrastructure which creates additional full-time jobs.
26 (b) Application.--A medical facility or a manufacturer may
27 submit an application to the authority requesting financial
28 assistance for a project. The application shall be on the form
29 required by the authority and shall include or demonstrate all
30 of the following:
20030S0010B1501 - 113 -
1 (1) The name and address of the applicant.
2 (2) A statement of the amount of financial assistance
3 sought.
4 (3) A statement of the project, including a detailed
5 statement of the cost of the project, and how it directly
6 relates to patient safety.
7 (4) A firm financial commitment from a responsible
8 source for any cost of the project in excess of the amount
9 requested.
10 (5) A firm commitment from the applicant to use or lease
11 the project upon completion.
12 (6) Any other information required by the authority.
13 (c) Review.--The authority shall forward the application to
14 the committee when it is complete. The committee shall review
15 the application to determine all of the following:
16 (1) If the project is for the construction or
17 acquisition of medical infrastructure directly related to
18 patient safety or for the construction or acquisition of
19 manufacturing infrastructure which creates additional full-
20 time jobs.
21 (2) If a financial commitment exists for any cost of the
22 project in excess of the amount requested.
23 (3) If the financial commitment from the source is firm.
24 (4) If the source of the financial commitment is
25 responsible.
26 (5) If the applicant is firmly committed to using or
27 leasing the project upon completion.
28 (6) If the applicant complied with all other criteria
29 established by the committee.
30 (d) Approval.--Upon being satisfied that all requirements
20030S0010B1501 - 114 -
1 have been met, the committee may approve the application and
2 notify the board. Upon being notified that a loan has been
3 approved, the board shall enter into a contract with the
4 applicant and finance the loan. As provided in subsection (e),
5 the contract may permit performance-based loan forbearance or
6 forgiveness.
7 (e) Forbearance or forgiveness.--The board, in consultation
8 with the department, may establish guidelines permitting
9 performance-based forbearance or forgiveness of payments by loan
10 recipients under this program. If the board establishes
11 guidelines, the guidelines shall permit the board to forbear or
12 forgive payments by loan recipients under this program when, in
13 the discretion of the board, the board determines that it is in
14 the interest of the Commonwealth to grant forbearance or
15 forgiveness.
16 (f) Applicability.--If a project of a medical facility or a
17 manufacturer has been approved for loan financing and the
18 project is to be financed with the proceeds of bonds which are
19 not exempt from Federal income taxation, the provisions of
20 Chapter 27 of the act of June 29, 1996 (P.L.434, No.67), known
21 as the Job Enhancement Act, shall not apply to the financing of
22 the project.
23 (g) Limitation.--Except upon foreclosure or default or
24 violation of a loan made, the board may not approve an
25 application or finance a project if the authority would be
26 required to operate, service or maintain the project under a
27 lease or other agreement. Nothing in this subsection shall
28 prohibit the authority from approving an application or
29 financing a project if at the end of the term of a loan the
30 authority transferred the project to the medical facility or
20030S0010B1501 - 115 -
1 manufacturer or a designee of the medical facility or
2 manufacturer.
3 § 4321. Water and Wastewater Infrastructure Capitalization
4 Program.
5 (a) Establishment.--There is established within the
6 authority a program to be known as the Water and Wastewater
7 Infrastructure Capitalization Program. The program shall provide
8 financial assistance in the form of loans or single-year or
9 multiyear grants to municipalities and municipal authorities for
10 projects which, when completed, improve or construct water and
11 wastewater infrastructure related to economic development.
12 (b) Application.--A municipality or a municipal authority
13 may submit an application to the authority requesting financial
14 assistance for a project. The application must be on the form
15 required by the authority and must include or demonstrate all of
16 the following:
17 (1) The name and address of the municipality or
18 municipal authority.
19 (2) A statement of the type and amount of financial
20 assistance sought. If the applicant is requesting financial
21 assistance in the form of a grant, the request may not exceed
22 75% of the cost of the project.
23 (3) A statement of the project, including a detailed
24 statement of the cost of the project.
25 (4) A firm financial commitment from a responsible
26 source for any cost of the project in excess of the amount
27 requested. If the applicant is requesting financial
28 assistance in the form of a grant from the authority, the
29 commitment may not be in the form of a grant from a
30 Commonwealth agency.
20030S0010B1501 - 116 -
1 (5) A firm commitment from the municipality or municipal
2 authority to use the project upon completion.
3 (6) Any other information required by the authority.
4 (c) Grants.--
5 (1) If an applicant is requesting financial assistance
6 in the form of a grant, the authority shall forward the
7 application to the committee when it is complete. The
8 committee shall review the application to determine all of
9 the following:
10 (i) If the project is for the improvement or
11 construction of water and wastewater infrastructure
12 related to economic development.
13 (ii) If there is a financial commitment for at least
14 25% of the project.
15 (iii) If the financial commitment from the source is
16 firm.
17 (iv) If the source of the financial commitment is
18 responsible.
19 (v) If the municipality or municipal authority is
20 firmly committed to using the project upon completion.
21 (vi) If the municipality or municipal authority
22 complied with all other criteria established by the
23 committee.
24 (2) Upon being satisfied that all requirements have been
25 met, the committee may approve the application and award a
26 grant to the applicant for the project in accordance with all
27 of the following:
28 (i) The grant may not exceed $10,000,000 in the
29 aggregate.
30 (ii) The aggregate amount of grants awarded to all
20030S0010B1501 - 117 -
1 applicants under this subsection shall not exceed
2 $250,000,000.
3 (3) Upon being notified that a grant has been awarded to
4 an applicant, the board shall enter into a contract with the
5 applicant and finance the grant.
6 (d) Authority loans.--
7 (1) If an applicant is requesting financial assistance
8 in the form of a loan, the authority shall forward the
9 application to the board when it is complete. Within 45 days
10 of a completed application being submitted, the board shall
11 review the application to determine all of the following:
12 (i) If the project is for the improvement or
13 construction of water and wastewater infrastructure
14 related to economic development.
15 (ii) If a financial commitment exists for any cost
16 of the project in excess of the amount requested.
17 (iii) If the financial commitment from the source is
18 firm.
19 (iv) If the source of the financial commitment is
20 responsible.
21 (v) If the municipality or municipal authority is
22 firmly committed to using the project upon completion.
23 (vi) If the municipality or municipal authority
24 complied with all other criteria established by the
25 board.
26 (2) Upon being satisfied that all program requirements
27 have been met, the board may approve the application. If the
28 board approves the application, the board shall enter into a
29 contract with the applicant and finance the loan.
30 (e) Pennvest loans.--In order to facilitate additional
20030S0010B1501 - 118 -
1 funding for water and wastewater infrastructure projects related
2 to economic development, the authority may utilize the remaining
3 amount of voter-approved debt under the act of March 16, 1992
4 (P.L.10, No.5), known as the Small Water Systems Assistance Act,
5 in accordance with the following:
6 (1) If an applicant is requesting financial assistance
7 in the form of a loan, the authority shall forward the
8 application to the board when it is complete. Within 45 days
9 of a completed application being submitted, the board shall
10 review the application to determine all of the following:
11 (i) If the project is for the improvement or
12 construction of water and wastewater infrastructure
13 related to economic development.
14 (ii) If a financial commitment exists for any cost
15 of the project in excess of the amount requested.
16 (iii) If the financial commitment from the source is
17 firm.
18 (iv) If the source of the financial commitment is
19 responsible.
20 (v) If the municipality or municipal authority is
21 firmly committed to using the project upon completion.
22 (vi) If the municipality or municipal authority
23 complied with all other criteria established by the
24 board.
25 (2) Upon being satisfied that all program requirements
26 have been met, the board may approve the application. If the
27 board approves the application, the board shall do all of the
28 following:
29 (i) Notify the applicant of the approval.
30 (ii) Notify the Pennsylvania Infrastructure
20030S0010B1501 - 119 -
1 Investment Authority of the amount approved.
2 (3) Loans approved under paragraph (2) shall not exceed
3 $220,000,000 in the aggregate.
4 (4) Upon being notified that a loan has been approved
5 for an applicant, the Pennsylvania Infrastructure Investment
6 Authority shall enter into a contract with the applicant and
7 finance the loan.
8 (f) Limitation.--Except upon foreclosure or default or
9 violation of a loan made, the board may not approve an
10 application or finance a project if the authority would be
11 required to operate, service or maintain the project under a
12 lease or other agreement. Nothing in this subsection shall
13 prohibit the authority from approving an application or
14 financing a project if, at the end of the term of a loan, the
15 authority transferred the project to the municipal authority.
16 (g) Debt.--If the question is submitted to the electors and
17 approved in accordance with law, the authority is authorized to
18 incur a maximum of $250,000,000 to finance grants and loans
19 awarded under subsection (c) and (d). Annual payments for
20 principal and interest resulting from grants made under this
21 section shall be annually appropriated to the authority from the
22 General Fund.
23 § 4322. Business in Our Sites Program.
24 (a) Establishment.--There is established within the
25 authority a program to be known as the Business in Our Sites
26 Program. The program shall provide financial assistance in the
27 form of loans to persons for projects which, when completed,
28 improve existing business sites, construct new business sites or
29 improve or construct business site infrastructure.
30 (b) Application.--A person may submit an application to the
20030S0010B1501 - 120 -
1 authority requesting financial assistance for a project. The
2 application shall be on the form required by the authority and
3 shall include or demonstrate all of the following:
4 (1) The name and address of the applicant.
5 (2) A statement of the amount of financial assistance
6 sought.
7 (3) A statement of the project, including a detailed
8 statement of the cost of the project.
9 (4) If the applicant is not a local economic development
10 agency, a copy of the document verifying approval of the
11 project by the appropriate local economic development agency.
12 (5) A firm financial commitment from a responsible
13 source for any cost of the project in excess of the amount
14 requested.
15 (6) A firm commitment from the applicant to use or lease
16 the project upon completion.
17 (7) Any other information required by the authority.
18 (c) Review.--The authority shall forward the application to
19 the committee when it is complete. The committee shall review
20 the application to determine all of the following:
21 (1) If the project is for the improvement of existing
22 business sites, the construction of new business sites or the
23 improvement or construction of business site infrastructure.
24 (2) If the project is approved by the appropriate local
25 economic development agency when the applicant is not a local
26 economic development agency.
27 (3) If a financial commitment exists for any cost of the
28 project in excess of the amount requested.
29 (4) If the financial commitment from the source is firm.
30 (5) If the source of the financial commitment is
20030S0010B1501 - 121 -
1 responsible.
2 (6) If the applicant is firmly committed to using or
3 leasing the project upon completion.
4 (7) If the applicant complied with all other criteria
5 established by the committee.
6 (d) Approval.--Upon being satisfied that all requirements
7 have been met, the committee may approve the application and
8 notify the board. Upon being notified that a loan has been
9 approved, the board shall enter into a contract with the
10 applicant and finance the loan. As provided in subsection (e),
11 the contract may permit performance-based loan forbearance or
12 forgiveness.
13 (e) Forbearance or forgiveness.--The board, in consultation
14 with the department, may establish guidelines permitting
15 performance-based forbearance or forgiveness of payments by loan
16 recipients under this program. If the board establishes
17 guidelines, the guidelines shall permit the board to forbear or
18 forgive payments by loan recipients under this program when, in
19 the discretion of the board, the board determines that it is in
20 the interest of the authority to grant forbearance or
21 forgiveness.
22 (f) Limitation.--Except upon foreclosure or default or
23 violation of a loan made, the board may not approve an
24 application or finance a project if the authority would be
25 required to operate, service or maintain the project under a
26 lease or other agreement. Nothing in this subsection shall
27 prohibit the authority from approving an application or
28 financing a project if, at the end of the term of a loan, the
29 authority transferred the project to the local economic
30 development authority.
20030S0010B1501 - 122 -
1 § 4323. First Industries Program.
2 (a) Establishment.--There is established within the
3 authority a program to be known as the First Industries Program.
4 The program shall provide financial assistance in the form of
5 loans to persons engaged in agriculture production or to persons
6 involved in tourism-related activities.
7 (b) Application.--A person may submit an application to the
8 authority requesting financial assistance for a project. The
9 application shall be on the form required by the authority and
10 shall include or demonstrate all of the following:
11 (1) The name and address of the person.
12 (2) A statement that the person is engaged in
13 agriculture production or is involved in tourism-related
14 activities.
15 (3) A statement of the amount of financial assistance
16 sought.
17 (4) A statement of the project, including a detailed
18 statement of the cost of the project.
19 (5) Any additional information required by Chapter 23
20 (relating to small business first).
21 (6) Any other information required by the authority.
22 (c) Review.--The authority shall forward the application to
23 the department when it is complete. The department shall review
24 the application in accordance with the requirements of this
25 section and Chapter 23 (relating to Small Business First). If
26 the department is satisfied that all requirements have been met,
27 the department may recommend approval of the application to the
28 board.
29 (d) Approval.--If the board receives a recommendation for
30 approval of an application from the department, the board may
20030S0010B1501 - 123 -
1 approve the application and finance the loan.
2 (e) Loan service.--Any loan financed by the authority under
3 this program shall be administered by the department. The
4 authority and the department shall enter into an agreement in
5 which the department agrees to transfer to the authority in a
6 timely manner any payments the department receives on loans made
7 in accordance with this section.
8 § 4324. Economic Enhancement Financing Program.
9 (a) Establishment.--There is established within the
10 authority a program to be known as the Economic Enhancement
11 Financing Program. The program shall provide financial
12 assistance to persons in the form of loans or single-year or
13 multiyear grants for projects.
14 (b) Application.--A person may submit an application to the
15 authority requesting financial assistance for a project. The
16 application shall be on the form required by the authority and
17 shall include or demonstrate all of the following:
18 (1) The name and address of the applicant.
19 (2) A statement of the type of financial assistance
20 sought.
21 (3) A statement of the project, including a detailed
22 statement of the cost of the project.
23 (4) Any other information required by the authority.
24 (c) Review.--The authority shall forward the application to
25 the committee when it is complete. The committee shall review
26 the application to determine all of the following:
27 (1) If the applicant is a person that owns property in a
28 tax incentive district or if the applicant is an issuing
29 authority of a tax increment district located within a tax
30 incentive district.
20030S0010B1501 - 124 -
1 (2) The project would be located in a tax incentive
2 district or is located in a tax increment district.
3 (3) The project would do or does any of the following:
4 (i) Creates career-oriented net new jobs or preserve
5 jobs.
6 (ii) Increases and diversifies the manufacturing
7 base of this Commonwealth.
8 (iii) Aids in the expansion of existing private
9 companies, particularly those that sell their products
10 outside this Commonwealth.
11 (iv) Attracts new industries with new products into
12 this Commonwealth.
13 (v) Promotes industrial, commercial and other
14 economic development within this Commonwealth.
15 (vi) Promotes a healthy environment through the
16 abatement, safe storage, transportation, reduction,
17 elimination, remediation and disposal within this
18 Commonwealth of pollutants and wastes.
19 (vii) Otherwise promotes the health, welfare and
20 safety of the residents of this Commonwealth by promoting
21 economic activity and efficiency or alleviating or
22 eliminating unemployment, blight and other unhealthy
23 conditions.
24 (4) If the applicant complied with all other criteria
25 established by the committee.
26 (d) Award.--Upon being satisfied that all requirements have
27 been met, the committee may approve an application and award a
28 grant or loan for a project in accordance with the following:
29 (1) The grant or loan may not exceed $10,000,000 in the
30 aggregate.
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1 (2) The aggregate amount of grants or loans awarded to
2 all applicants under this section shall not exceed financing
3 supported by the Economic Enhancement Fund.
4 (e) Financing.--Upon being notified that a grant or loan has
5 been awarded to an applicant, the board shall finance the grant
6 or loan.
7 (f) Debt limitation.--The authority is authorized on a
8 continuing basis to incur debt supported by the Economic
9 Enhancement Fund to finance grants and loans awarded under this
10 section. All payments for the debt resulting from grants or
11 loans made under this section shall be paid from the Economic
12 Enhancement Fund.
13 (g) Contract proceeds.--Any money received from a grant or
14 loan recipient under this program shall be deposited in the
15 Economic Enhancement Fund.
16 (h) First issuance.--The first series of bonds to be issued
17 by the authority shall be issued in a manner and at a time so
18 that the net proceeds of the bonds shall be available on or
19 before June 30, 2004, or as soon as practicable after June 30,
20 2004.
21 § 4325. Secondary Growth Stage Financing Program.
22 (a) Establishment.--There is established within the
23 authority a program to be known as the Secondary Growth Stage
24 Financing Program. The program shall provide financial
25 assistance to certain persons in the form of loans for projects.
26 (b) Growth stage partners.--
27 (1) A person may submit an application to the authority
28 requesting designation as a growth stage partner. The
29 application shall be on the form required by the authority
30 and shall include or demonstrate all of the following:
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1 (i) The name and address of the person.
2 (ii) A statement demonstrating that the person is
3 experienced in financing expanding businesses.
4 (iii) A statement of the maximum amount of
5 investment the person is willing to make in the program.
6 (iv) Any other information required by the
7 authority.
8 (2) The authority shall forward the application to the
9 committee. The committee shall review the application and
10 determine if the person possesses prudent investment
11 experience. Upon being satisfied that all requirements have
12 been met, the committee shall recommend the person to the
13 board.
14 (3) If the board receives a recommendation from the
15 committee, the board shall enter into a contract with the
16 person and designate the person a growth stage partner in
17 accordance with all of the following:
18 (i) The board shall ensure that at least one growth
19 stage partner exists in each geographic region of the
20 Commonwealth.
21 (ii) The contract shall specify that loan payments
22 will be applied on a pro rata basis.
23 (c) Loans.--
24 (1) A person may submit an application to a growth stage
25 partner requesting financial assistance for a project. The
26 application shall be on the form required by the authority
27 and shall include or demonstrate all of the following:
28 (i) The name and address of the person.
29 (ii) A statement that the person has been in
30 business more than two years but less than seven.
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1 (iii) A statement of the amount of financial
2 assistance sought.
3 (iv) A statement of the project including a detailed
4 statement of the cost of the project.
5 (v) Any other information required by the authority
6 or by the growth stage partner.
7 (2) The growth stage partner shall review the
8 application to determine if the project is a responsible
9 investment. If the growth stage partner is satisfied that the
10 project is responsible, the growth stage partner may
11 recommend approval of the application to the board.
12 (3) If the board receives a recommendation for approval
13 of an application from a growth stage partner, the board may
14 approve the application.
15 (4) Upon approval of the application, the growth stage
16 partner and the authority shall enter into a contract with
17 the applicant and finance the loan in accordance with the
18 following:
19 (i) The growth stage partner shall finance at least
20 25% of the loan amount.
21 (ii) The authority may finance the loan in an amount
22 not to exceed 75% of the loan.
23 (iii) The contract may include a provision granting
24 the growth stage partner a mortgage interest in property
25 owned by the applicant.
26 (d) Loan service.--Any loan financed by the authority under
27 this section shall be administered by the growth stage partner.
28 The authority and each growth stage partner shall enter into an
29 agreement pursuant to which the growth stage partner agrees to
30 transfer to the authority in a timely manner its pro rata share
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1 of any payments received by the growth stage partner on loans
2 made in accordance with this section.
3 § 4326. Community Development Bank Program (Reserved).
4 SUBCHAPTER E
5 MISCELLANEOUS
6 (RESERVED)
7 CHAPTER 45
8 LOCAL ECONOMIC DEVELOPMENT FINANCING AUTHORITIES
9 (RESERVED)
10 CHAPTER 47
11 PENNSYLVANIA INFRASTRUCTURE INVESTMENT AUTHORITY
12 (RESERVED)
13 Section 2. Title 72 is amended by adding parts to read:
14 PART III
15 FUNDS
16 Chapter
17 72. Economic Enhancement Fund
18 CHAPTER 72
19 ECONOMIC ENHANCEMENT FUND
20 Sec.
21 7201. Scope.
22 7202 Definitions.
23 7203. Establishment.
24 7204. Calculation.
25 7205. Transfer.
26 7206. Appropriation and payments.
27 § 7201. Scope.
28 This chapter relates to the Economic Enhancement Fund.
29 § 7202. Definitions.
30 The following words and phrases when used in this chapter
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1 shall having the meaning given to them in this section unless
2 the context clearly indicates otherwise:
3 "Authority." The Pennsylvania Economic Development Authority
4 established by 12 Pa.C.S. Ch. 43 (relating to Pennsylvania
5 Economic Development Financing Authority).
6 "Department." The Department of Revenue of the Commonwealth.
7 "Fund." The Economic Enhancement Fund established by section
8 7203 (relating to establishment).
9 "Tax incentive district." Property designated by the
10 Department of Community and Economic Development as a tax
11 incentive district in accordance with 12 Pa.C.S. Ch. 33
12 (relating to economic enhancement).
13 "Tax Reform Code of 1971." The act of March 4, 1971 (P.L.6,
14 No.2), known as the Tax Reform Code of 1971.
15 § 7203. Establishment.
16 There is hereby established a special fund known as the
17 Economic Enhancement Fund. Interest income derived from
18 investment of the money in the fund shall be credited by the
19 Treasury Department to the fund.
20 § 7204. Calculation.
21 Within 30 days of the end of each quarter, the department
22 shall calculate and notify the Secretary of the Budget of the
23 aggregate revenue received pursuant to Articles II, IV and VI of
24 the Tax Reform Code of 1971 from taxpayers located within tax
25 incentive districts.
26 § 7205. Transfer.
27 Within ten days of receiving notification in accordance with
28 section 7204 (relating to calculation), the Secretary of the
29 Budget shall direct the State Treasurer to transfer a sum, equal
30 to 25% of the aggregate revenue received pursuant to Articles
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1 II, IV and VI of the Tax Reform Code of 1971, from taxpayers
2 located within tax incentive districts, from the General Fund to
3 the fund. Transfers from the General Fund to the fund shall not
4 exceed $10,000,000 in the aggregate in any one fiscal year.
5 § 7206. Appropriation and payments.
6 Money in the fund is hereby appropriated on a continuing
7 basis to the authority for the Economic Enhancement Financing
8 Program established in 12 Pa.C.S. § 4324 (relating to Economic
9 Enhancement Financing Program). The State Treasurer shall
10 provide semiannual payments to the authority on August 1 and
11 February 1 of each year until the authority is terminated in
12 accordance with 12 Pa.C.S. § 4303(j) (relating to authority).
13 August 1 payments shall be equal to the balance of the fund on
14 July 15 of that calendar year, and February 1 payments shall be
15 equal to the balance of the fund on January 15 of that calendar
16 year.
17 PART IV
18 DEBT
19 Chapter
20 91. Capital Facilities
21 92. Sports Facilities
22 CHAPTER 91
23 CAPITAL FACILITIES
24 Sec.
25 9101. Scope of chapter.
26 9102. Definitions.
27 9103. Procedures for capital budget bill and debt-authorizing
28 legislation.
29 9104. Certificates of the Auditor General.
30 9105. Constitutional limitations, authorizations, issuing
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1 officials.
2 9106. Temporary borrowing.
3 9107. Bonds, issue of bonds and notes, maturity, interest.
4 9108. Direct obligations, exemption from taxation, means of
5 payment.
6 9109. Sale of bonds.
7 9110. Disposition and use of proceeds.
8 9111. Capital Debt Fund; investments; redemption of bonds.
9 9112. Funding bonds.
10 9113. Reporting requirements.
11 9114. Registration of bonds.
12 9115. Voting requirements.
13 9116. Appropriation.
14 9117. Appropriation for and limitation on redevelopment
15 assistance and site development capital projects.
16 9118. Funding and administration of redevelopment assistance
17 capital projects.
18 9119. Funding and administration of site development capital
19 projects.
20 9120. Capital Project Oversight and Review Committee.
21 § 9101. Scope of chapter.
22 This chapter deals with capital facilities.
23 § 9102. Definitions.
24 The following words and phrases when used in this chapter
25 shall have the meanings given to them in this section unless the
26 context clearly indicates otherwise:
27 "Acquisition cost." The cost of acquiring:
28 (1) buildings;
29 (2) structures;
30 (3) facilities;
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1 (4) property, real, personal or mixed, tangible or
2 intangible; or
3 (5) any other interest;
4 necessary or desirable in connection with a capital project,
5 whether the acquisition be by purchase or by condemnation,
6 including the amount of an award or final judgment in a
7 proceeding to acquire by condemnation lands, rights-of-way,
8 rights-of-slope, property rights, franchises, easements or other
9 interests as deemed necessary or convenient in connection with
10 the acquisition or construction of a project, and costs of
11 options and partial payments on and under options.
12 "Capital project." A project which is financed by debt or by
13 other funds and which meets all of the following:
14 (1) Is an undertaking to construct, repair, renovate,
15 improve, equip, furnish or acquire any:
16 (i) building, structure, facility or physical public
17 betterment or improvement;
18 (ii) land or rights in land; or
19 (iii) furnishings, machinery, apparatus or equipment
20 for a building, structure, facility or physical public
21 betterment or improvement.
22 (2) Is designated in a capital budget as a capital
23 project.
24 (3) Has an estimated useful life in excess of five
25 years.
26 (4) Has an estimated financial cost in excess of
27 $250,000. This paragraph does not apply to original equipment
28 or furnishings for previously authorized public improvement
29 projects.
30 Capital projects are categorized as flood control projects,
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1 highway projects, public improvement projects, redevelopment
2 assistance capital projects, site development capital projects
3 and transportation assistance projects.
4 "Committee." The Capital Project Oversight and Review
5 Committee established in section 9120 (relating to Capital
6 Project Oversight and Review Committee).
7 "Commonwealth agency or authority." Excludes an agency or
8 authority organized by action of a political subdivision.
9 "Construction cost." Obligations incurred:
10 (1) for labor and to contractors, builders and
11 materialmen in connection with the construction, fabrication
12 or assembly of a capital project;
13 (2) for machinery and equipment required for
14 construction under paragraph (1);
15 (3) for the restoration of property damaged or destroyed
16 in connection with construction under paragraph (1); and
17 (4) for the payment of damages incurred by others
18 incident to or consequent upon construction under paragraph
19 (1) which the Commonwealth or its agency or authority is
20 under legal obligation to pay or desires to pay in settlement
21 of a disputed claim of liability.
22 "Debt." The issued and outstanding obligations of the
23 Commonwealth incurred without a vote of the electorate or
24 incurred with such vote under a law making such debt subject to
25 the provisions of section 7(a)(4) of Article VIII of the
26 Constitution of Pennsylvania. The term includes obligations of
27 Commonwealth agencies and authorities to the extent that such
28 obligations are to be repaid from lease rentals or other charges
29 payable directly or indirectly from revenues of the
30 Commonwealth. The term does not include:
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1 (1) that portion of debt which is to be repaid from
2 charges made to the public for the use of the capital
3 projects financed, as such portion of debt may be determined
4 by the Auditor General;
5 (2) obligations to be repaid from lease rentals or other
6 charges payable by a school district or other local taxing
7 authority; or
8 (3) obligations to be repaid by agencies or authorities
9 created for the joint benefit of the Commonwealth and one or
10 more other state governments.
11 "Debt-authorizing act." The legislation required by section
12 9103(d) (relating to procedures for capital budget bill and
13 debt-authorizing legislation).
14 "Financial cost." Acquisition cost and construction cost,
15 where applicable, and an allocated portion of all of the
16 following:
17 (1) Fees, expenses and costs of issuing obligations the
18 proceeds of which are used to finance the project.
19 (2) Fees, expenses and costs of issuing and selling
20 notes or replacement notes issued under this chapter.
21 (3) Establishing and maintaining any purchase, loan or
22 credit agreements in connection with an issue or series of
23 issues of notes, and the fees and expenses of any fiscal or
24 loan and transfer agent and bond counsel incurred in
25 connection with the issue of the obligations.
26 (4) Premiums on insurance in connection with a project
27 during construction.
28 (5) Taxes and other municipal or governmental charges
29 lawfully levied or assessed during construction.
30 (6) Fees and expenses of architects, engineers and other
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1 professionals for:
2 (i) making preliminary studies, reports or estimates
3 of costs;
4 (ii) preparing plans and specifications and
5 inspecting and reviewing the progress of construction;
6 and
7 (iii) obtaining abstracts of title, title insurance
8 or title opinions.
9 (7) Costs and expenses of preliminary investigations,
10 preplanning, surveys and reports to determine the proper
11 scope, feasibility and probable costs of capital projects to
12 be included in future capital budgets.
13 (8) Costs of administration, including the salaries and
14 expenses of administrators, reviewing architects and
15 engineers, construction inspectors, accountants and legal
16 counsel of the Commonwealth and its agencies or authorities,
17 incurred for the proper planning and supervision of the
18 capital projects program.
19 "Flood control projects." Projects of the type which the
20 Water and Power Resources Board is authorized to construct,
21 improve, equip, maintain, acquire or operate under the
22 provisions of the act of August 7, 1936 (1st Sp.Sess., P.L.106,
23 No.46), referred to as the Flood Control Law.
24 "Fund." Any fund other than a fund, or an account in a fund,
25 established by this chapter.
26 "Funding bonds." General obligation bonds used to provide
27 funds for and towards the payment of outstanding notes or to
28 refund other outstanding bonds prior to or at or after the
29 stated maturity date of the bonds being refunded or of the notes
30 being funded.
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1 "Highway projects." Projects of a type which the Department
2 of Transportation is authorized to construct, improve, equip,
3 maintain, acquire or operate.
4 "Hospital." As defined in section 802.1 of the act of July
5 19, 1979 (P.L.130, No.48), known as the Health Care Facilities
6 Act.
7 "Issuing officials." The Governor, the Auditor General and
8 the State Treasurer.
9 "Net debt."
10 (1) The aggregate principal amount of all debt; plus
11 (2) the amount of any past due and unpaid interest on
12 that debt; minus
13 (3) all funds held exclusively for the payment of that
14 principal and past due interest.
15 Neither accrued but not yet past due interest nor funds held for
16 the payment of the interest next falling due, up to the amount
17 of such interest, shall be included in such computations.
18 "Notes." Temporary obligations and replacement notes issued
19 by the Commonwealth pursuant to this chapter in anticipation of
20 bonds.
21 "Obligations." Notes or bonds of the Commonwealth, its
22 agencies or authorities, issued pursuant to any debt authorizing
23 act.
24 "Public improvement projects." Projects of a type which the
25 General State Authority is authorized to construct, improve,
26 equip, furnish, maintain, acquire or operate under the
27 provisions of the act of March 31, 1949 (P.L.372, No.34), known
28 as The General State Authority Act of one thousand nine hundred
29 forty-nine, and projects which the Department of General
30 Services is authorized to construct, improve, equip, furnish,
20030S0010B1501 - 137 -
1 maintain, acquire or operate.
2 "Redevelopment assistance capital project." The design and
3 construction of facilities which meet the following:
4 (1) Are facilities, other than housing units, highways,
5 bridges, waste disposal facilities, sewage facilities or
6 water facilities. This paragraph includes:
7 (i) water and sewer infrastructure, bridges and
8 roads included in business or industrial park facilities;
9 and
10 (ii) hospital facilities and capital improvements
11 for hospital facilities.
12 (2) Are economic development projects which generate
13 substantial increases in employment, tax revenues or other
14 measures of economic activity. This paragraph includes
15 projects with cultural, historical or civic significance.
16 (3) Are facilities which have a regional or
17 multijurisdictional impact.
18 (4) Are eligible for tax-exempt bond funding under
19 existing Federal law and regulations.
20 (5) Have a 50% non-State participation documented at the
21 time of application, including a portion of any funds
22 reserved for future physical maintenance and operation of the
23 facilities:
24 (i) at least half of which is secured funding;
25 (ii) toward which the only noncash non-State
26 participation permitted is land or fixed assets which
27 have a substantial useful life and are directly related
28 to the project;
29 (iii) toward which State funds from other programs
30 may not be used; and
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1 (iv) toward which funds from Federal sources may be
2 used.
3 (6) Have a total project cost of at least $1,000,000.
4 Applicants must be one of the following:
5 (i) A redevelopment authority.
6 (ii) An industrial development authority.
7 (iii) A general purpose unit of local government.
8 (iv) A local development district which has an
9 agreement with a general purpose unit of local government
10 under which the unit assumes ultimate responsibility for
11 debt incurred to obtain the 50% non-State participation
12 required by paragraph (5).
13 (v) An industrial development corporation.
14 "Replacement notes." Notes:
15 (1) the net proceeds of which are used to pay principal,
16 accrued interest and premium of previously issued notes or
17 replacement notes; and
18 (2) which evidence the same temporary borrowing of the
19 Commonwealth as the notes or replacement notes replaced.
20 "Site development capital projects." The design and
21 construction of infrastructure and improvements for locations
22 which meet all of the following:
23 (1) Are locations suitable for the siting of business,
24 industrial or research facilities upon completion of the
25 project.
26 (2) Create opportunities to develop new facilities or to
27 expand existing facilities for business, service industries,
28 manufacturing, research and development or other business or
29 industrial operations which produce goods or services as
30 determined by the Secretary of Community and Economic
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1 Development.
2 (3) Result in the creation of new jobs or the
3 preservation of existing jobs.
4 (4) Have a 50% non-State participation documented at the
5 time of application:
6 (i) at least one-half of which is secured funding;
7 (ii) toward which the only noncash, non-State
8 participation permitted is land or fixed assets which
9 have a substantial useful life and are directly related
10 to the project; and
11 (iii) toward which State funds from other programs
12 may not be used.
13 (5) Have a total project cost of at least $1,000,000.
14 (6) The project applicant is a municipality, municipal
15 authority, industrial development authority, redevelopment
16 authority, industrial development corporation or a general
17 purpose unit of local government.
18 (7) The project applicant can demonstrate to the
19 secretary that the location will be occupied by a business or
20 industrial tenant within five years of completion of the
21 project or such other reasonable period of time as may be
22 designated by the secretary.
23 "Tax revenues." All revenues from Commonwealth imposed
24 taxes, regardless of the fund to which they are deposited,
25 including revenues from motor vehicle licenses, which are
26 declared to be taxes for purposes of this chapter. The term does
27 not include revenues from any other licenses or from interest,
28 fees, fines or penalties.
29 "Transportation assistance projects." Projects of a type
30 which the Department of Transportation is authorized to
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1 construct, improve, equip, furnish, maintain, acquire or operate
2 under 74 Pa.C.S. Pt. II (relating to public transportation) and
3 capital projects which the Department of Transportation is
4 authorized to construct, improve, equip or furnish under the
5 provisions of the act of February 11, 1976 (P.L.14, No.10),
6 known as the Pennsylvania Rural and Intercity Common Carrier
7 Surface Transportation Assistance Act, including the acquisition
8 of property authorized in those statutes.
9 § 9103. Procedures for capital budget bill and debt-authorizing
10 legislation.
11 (a) Legislative process.--A capital budget prepared in
12 accordance with this chapter shall be submitted for each fiscal
13 year by the Governor to the General Assembly and shall be
14 considered in the form of a bill as provided in Article III of
15 the Constitution of Pennsylvania.
16 (b) Itemization.--
17 (1) Except as set forth in paragraph (2), the capital
18 budget bill must specifically itemize, by brief identifying
19 description and estimated financial cost, the capital
20 projects to be financed from:
21 (i) the proceeds of obligations of the Commonwealth;
22 or
23 (ii) current revenues.
24 (2) Paragraph (1) does not apply if the itemization is:
25 (i) contained in or approved by prior legislation
26 referred to in the capital budget bill; or
27 (ii) included in one or more supplemental capital
28 budget bills.
29 (3) Projects must be listed in separate categories as
30 well as according to the fund to be charged with the
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1 repayment of the obligations to be incurred.
2 (4) The capital budget bill must state the maximum
3 amount of such obligations which may be incurred in the
4 ensuing fiscal year to provide funds for and towards the
5 financial costs of each category of capital projects, which
6 shall be by the issue of general obligations of the
7 Commonwealth.
8 (c) Timing.--Each year the Governor shall submit a capital
9 budget bill for the ensuing fiscal year.
10 (d) Debt-authorizing legislation.--At the time the Governor
11 submits the capital budget or a supplement, the Governor shall,
12 to the extent the debt to be incurred is not within the limits
13 of legislation then in force authorizing the incurring of debt,
14 submit additional bills for each category of capital projects,
15 authorizing the incurring of debt to provide funds for and
16 towards the payment of the financial costs of capital projects
17 in such category which have been specifically itemized in a
18 capital budget for the same or any prior year.
19 (e) Categories.--Each debt-authorizing bill must do all of
20 the following:
21 (1) State the category of capital projects to be
22 financed by the debt so authorized but need not enumerate the
23 capital projects to be financed.
24 (2) Authorize the incurring of debt in not less than the
25 amount of the incurred or expected to be incurred financial
26 cost of all capital projects in such category not covered by
27 a previous debt authorization, including any overall
28 allowance for contingencies.
29 (3) State the estimated useful lives of the capital
30 projects to be financed in such detail as may be requisite if
20030S0010B1501 - 142 -
1 capital projects of varying useful lives are to be combined
2 for financing purposes.
3 (4) State the maximum term of the debt to be incurred.
4 § 9104. Certificates of the Auditor General.
5 (a) Requirement.--By March 1 and September 1, the Auditor
6 General shall certify to the Governor and the General Assembly
7 the average annual tax revenues deposited in all funds in the
8 five fiscal years ended next preceding the date of the
9 certificate, determined by adding the total of such revenues so
10 deposited and dividing the sum by five. At the time of each
11 certification, the Auditor General shall also certify as
12 separate items:
13 (1) the amount of outstanding net debt as of the end of
14 the preceding fiscal year;
15 (2) the amount of outstanding net debt as of the date of
16 the certificate;
17 (3) the difference between the limitation upon all
18 outstanding net debt as provided in section 7(a)(4) of
19 Article VIII of the Constitution of Pennsylvania and
20 paragraph (2);
21 (4) the amount of outstanding net debt scheduled to be
22 repaid during the remainder of the fiscal year in which the
23 certificate is issued;
24 (5) the amount of debt authorized by law to be issued
25 but not yet incurred; and
26 (6) the amount of outstanding obligations excluded from
27 outstanding debt as self-sustaining pursuant to section
28 7(c)(1), (2) and (3) of Article VIII of the Constitution of
29 Pennsylvania.
30 (b) Additional certificates.--As required in connection with
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1 the sale of or settlement for obligations of the Commonwealth,
2 the Auditor General shall issue certificates containing items
3 listed in subsection (a)(2) and (3) as of the dates determined
4 by the Governor to be relevant to such sales or settlements.
5 (c) Reliance on certifications.--In making certificates, the
6 Auditor General shall be entitled to rely, as to any of items
7 listed in subsection (a)(1) through (5), upon:
8 (1) any certificate furnished by the State Treasurer
9 with respect to outstanding Commonwealth general obligation
10 bonds;
11 (2) any certificate furnished by the Department of
12 Revenue; and
13 (3) any certificate furnished by the appropriate bank or
14 trust company operating as fiscal agent or trustee with
15 respect to the outstanding obligations of any authority.
16 § 9105. Constitutional limitations, authorizations, issuing
17 officials.
18 Within the limitation set forth in section 7(a)(4) of Article
19 VIII of the Constitution of Pennsylvania, the issuing officials
20 are authorized and directed to borrow, on the credit of the
21 Commonwealth and subject to the conditions and limitations of
22 the act of April 9, 1929 (P.L.343, No.176), known as The Fiscal
23 Code, money necessary to carry out the purposes of debt-
24 authorizing acts passed in accordance with the provisions of
25 this chapter.
26 § 9106. Temporary borrowing.
27 (a) Authorization.--Pending the issuance of bonds of the
28 Commonwealth as authorized in section 9107 (relating to bonds,
29 issue of bonds and notes, maturity, interest), the issuing
30 officials are authorized, in accordance with the provisions of
20030S0010B1501 - 144 -
1 this chapter and on the credit of the Commonwealth, to make
2 temporary borrowings not to exceed three years in anticipation
3 of the issue of bonds in order to provide funds in such amounts
4 as deemed advisable to carry out the purposes of any debt-
5 authorizing acts prior to the issue of bonds. In order to
6 provide for and in connection with the temporary borrowings, the
7 issuing officials are authorized in the name and on behalf of
8 the Commonwealth to enter into any purchase, loan or credit
9 agreement or other agreement with banks, trust companies,
10 lending institutions, investment banking firms or persons in the
11 United States having the appropriate power. Agreements may
12 contain provisions not inconsistent with the provisions of this
13 chapter, as authorized by the issuing officials.
14 (b) Evidence.--All temporary borrowings made under the
15 authorization of this section shall be evidenced by notes of the
16 Commonwealth, which shall be issued for such amounts not
17 exceeding in the aggregate the applicable statutory and
18 constitutional debt limitation, in form and denominations and
19 subject to terms and conditions of sale and issue, prepayment or
20 redemption and maturity, rate of interest and time of payment of
21 interests, as the issuing officials authorize and direct and in
22 accordance with the applicable debt-authorizing act.
23 Authorization and direction may provide for the subsequent
24 issuance of replacement notes to refund outstanding notes or
25 replacement notes. Replacement notes shall, upon issuance,
26 evidence the borrowing and may specify other terms and
27 conditions with respect to the notes and replacement notes
28 authorized for issuance as the issuing officials may determine
29 and direct.
30 (c) Replacement notes.--
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1 (1) If the authorization and direction of the Governor,
2 the Auditor General and the State Treasurer provide for the
3 issuance of replacement notes, the Governor, the Auditor
4 General and the State Treasurer are authorized, in the name
5 and on behalf of the Commonwealth, to issue, enter into or
6 authorize and direct the State Treasurer to do the following:
7 (i) Enter into agreements with banks, trust
8 companies, investment banking firms or other institutions
9 or persons in the United States having appropriate power
10 to purchase or underwrite an issue or series of issues of
11 notes.
12 (ii) Enter into a purchase, loan or credit
13 agreement.
14 (iii) Draw money pursuant to a purchase, loan or
15 credit agreement on the terms and conditions set forth in
16 the agreement.
17 (iv) Issue notes as evidence of borrowings made
18 under a purchase, loan or credit agreement.
19 (v) Appoint an issuing and paying agent or agents
20 with respect to notes.
21 (vi) Perform acts necessary or appropriate to
22 provide for the payment, when due, of the interest on and
23 principal of notes.
24 (2) Agreements under paragraph (1) may provide that the
25 compensation of purchasers or underwriters of notes or
26 replacement notes, by discount in the purchase price of the
27 notes or by payment of a fixed fee or commission at the time
28 of issuance of the notes, and that all other costs and
29 expenses, including fees for agreements related to the notes,
30 issuing and payment agent costs and costs and expenses of
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1 issuance, may be paid from the proceeds of the notes.
2 (d) Issuance of replacement notes.--If the authorization and
3 direction of the Governor, the Auditor General and the State
4 Treasurer provide for the issuance of replacement notes, the
5 State Treasurer shall, by the time of delivery of these notes or
6 replacement notes, determine the principal amounts, dates of
7 issuance, interest rates or procedures for establishing interest
8 rates, rates of discount, denominations and all other terms and
9 conditions relating to the issuance and shall perform all acts
10 necessary to pay or cause to be paid when due all principal of
11 and interest on the notes being refunded by replacement notes
12 and to assure that payment may draw upon any money available for
13 that purpose pursuant to any purchase, loan or credit agreements
14 established with respect to the notes, subject to the
15 authorization and direction of the Governor, the Auditor General
16 and the State Treasurer.
17 (e) Funding and retirement.--Outstanding notes evidencing
18 borrowings may be funded and retired by the issuance and sale of
19 the bonds of the Commonwealth under section 9112 (relating to
20 funding bonds). Funding bonds must be issued and sold not later
21 than a date three years after the date of issuance of the first
22 notes evidencing the borrowings, to the extent that payment of
23 the notes has not otherwise been made or provided for by sources
24 other than proceeds of replacement notes.
25 (f) Proceeds.--The proceeds of temporary borrowings except
26 those evidenced by replacement notes shall be paid to the State
27 Treasurer to be held and disposed of under section 9110
28 (relating to disposition and use of proceeds). The proceeds of
29 temporary borrowings evidenced by replacement notes shall be
30 paid to the State Treasurer to be held and disposed of under
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1 subsection (d).
2 § 9107. Bonds, issue of bonds and notes, maturity, interest.
3 (a) Issue.--As evidence of indebtedness as authorized,
4 bonds, which may be for one or more purposes, shall be issued
5 under this chapter for all of the following purposes:
6 (1) To fund or retire notes issued under section 9106
7 (relating to temporary borrowing) and bonds issued under
8 paragraph (2).
9 (2) To provide money necessary to carry out the purposes
10 of a debt-authorizing statute.
11 (b) Series.--The bonds of each issue shall constitute a
12 separate series to be designated by the issuing officials or may
13 be combined for sale as one series with other general obligation
14 bonds of the Commonwealth. Each series of bonds shall bear such
15 rate of interest as determined by the issuing officials. Bonds
16 shall be issued in denominations and in form, whether coupon or
17 registered as to both principal and interest, and with or
18 without such provisions of interchangeability, as the issuing
19 officials determine. If interest coupons are attached, they
20 shall, unless the debt-authorizing act provides otherwise,
21 contain the facsimile signature of the State Treasurer.
22 (c) Terms and conditions.--
23 (1) Except as set forth in subsection (a) or (b), the
24 terms and conditions of issue, redemption and maturity and
25 time of payment of interest shall be as the issuing officials
26 shall specify. Bonds of any series shall mature within a
27 period not to exceed the estimated useful lives of the
28 capital projects as stated in the debt-authorizing act but
29 not later than 30 years from the date of issuance.
30 (2) The issuing officials shall provide for the
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1 amortization of the bonds in substantial and regular amounts
2 over the term of the debt, but the first retirement of
3 principal shall be stated to mature prior to the expiration
4 of a period of time equal to one-tenth of the time from the
5 date of the first obligation issued to evidence the debt to
6 the date of the expiration of the term of the debt.
7 (3) Retirements of principal shall be regular and
8 substantial if made in annual or semiannual amounts whether
9 by stated serial maturities or by mandatory sinking fund
10 retirements computed in accordance with either a level annual
11 debt service plan as nearly as may be or upon the equal
12 annual maturities plan.
13 (4) If debt is incurred in one issue of bonds to provide
14 funds for and towards the financial cost of capital projects
15 having estimated useful lives of varying length, the
16 following shall apply:
17 (i) The aggregate of the financial costs shall be
18 considered as the debt to be incurred for the purpose of
19 fixing the regular and substantial amounts of principal
20 to be retired.
21 (ii) The term of the debt shall be to the end of the
22 longest estimated useful life for the purpose of
23 determining the first date for the retirement of
24 principal. At the end of the estimated useful life of
25 each project, the aggregate principal retirements
26 required to be made at or before that date shall exceed:
27 (A) the aggregate financial cost of all capital
28 projects having the same or shorter estimated useful
29 lives; or
30 (B) if bonds are issued for less than the full
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1 financial cost of all projects being financed in the
2 same category, a proportionate amount in each case.
3 (5) The issuing officials may enter into the following
4 agreements and contracts, which in the judgment of the
5 issuing officials will assist in managing the interest costs
6 of the debt of the Commonwealth:
7 (i) Interest rate exchange agreements, interest rate
8 cap and floor agreements and other similar agreements.
9 (ii) Contracts to insure or secure payment of
10 principal, interest or the purchase price of bonds.
11 (6) The issuing officials are authorized to carry out
12 the provisions of this chapter relating to the issuance of
13 bonds and shall determine all matters in connection with the
14 issuance of bonds subject to the provisions hereof.
15 (d) Verification.--
16 (1) Bonds issued under the authority of this chapter,
17 unless the debt-authorizing acts provide another method of
18 signature, shall bear the facsimile signatures of the issuing
19 officials and a facsimile of the Great Seal of the
20 Commonwealth of Pennsylvania and shall be countersigned by an
21 officer of an authorized loan and transfer agent of the
22 Commonwealth.
23 (2) The action taken by the issuing officials
24 authorizing the issuance of bonds or notes shall set forth
25 the title and citation of the debt-authorizing acts.
26 (3) Notes and bonds issued under the authority of this
27 chapter shall:
28 (i) either contain a similar recital or refer to the
29 recital of titles and citations set forth in the action
30 authorizing issuance; and
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1 (ii) state that the bonds or notes are issued in
2 accordance with the provisions of this chapter. In any
3 action or proceeding involving the validity or
4 enforceability of bonds or notes under this chapter, a
5 recital under paragraph (3) shall be conclusive as to
6 their authorization.
7 § 9108. Direct obligations, exemption from taxation, means of
8 payment.
9 (a) Direct obligation.--Notes and bonds issued under this
10 chapter shall be direct obligations of the Commonwealth, and the
11 full faith and credit of the Commonwealth are pledged for the
12 payment of the interest as it becomes due and the payment of the
13 principal at maturity.
14 (b) Exemptions.--Notes and bonds issued under this chapter
15 shall be exempt from taxation for State and local purposes
16 except as provided under the act of March 4, 1971 (P.L.6, No.2),
17 known as the Tax Reform Code of 1971.
18 (c) Payment.--The principal of and interest on notes and
19 bonds issued under this chapter shall be payable in lawful money
20 of the United States of America.
21 § 9109. Sale of bonds.
22 (a) Public sale.--When bonds are issued under this chapter,
23 they shall be offered for sale at not less than 98% of the
24 principal amount and accrued interest and shall be sold by the
25 issuing officials to the highest and best bidder or bidders
26 after public advertisement on terms and conditions and upon open
27 competitive bidding as the issuing officials direct. The manner
28 and times of advertising shall be prescribed by the issuing
29 officials.
30 (b) Private sale.--Any portion of a bond issue offered under
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1 subsection (a) and not sold or subscribed to may be disposed of
2 by private sale by the issuing officials in a manner and at
3 prices, not less than 98% of the principal amount and accrued
4 interest, as the Governor directs. No commission shall be
5 allowed or paid for the sale of bonds issued under this chapter.
6 (c) Temporary bonds.--Until permanent bonds can be prepared,
7 the issuing officials may issue, in lieu of permanent bonds,
8 temporary bonds in form and with privileges as to the
9 registration and exchange for permanent bonds as may be
10 determined by the issuing officials.
11 § 9110. Disposition and use of proceeds.
12 (a) General rule.--The proceeds of temporary borrowings made
13 under section 9106 (relating to temporary borrowing), other than
14 the proceeds of replacement notes, and the proceeds from the
15 sale of bonds, other than funding bonds, shall be paid to the
16 State Treasurer and be held by the State Treasurer in a separate
17 fund and shall be deposited in depositories as selected by the
18 State Treasurer to the credit of the Capital Facilities Fund,
19 which shall have such separate accounts as may be deemed
20 desirable by the issuing officials, but not less than one
21 separate account for each category of capital projects. The
22 proceeds of replacement notes shall be deposited and applied as
23 provided in section 9106(d). The proceeds of funding bonds shall
24 be deposited and applied as provided in section 9112 (relating
25 to funding bonds).
26 (b) Dedication.--The money in the Capital Facilities Fund is
27 specifically dedicated to meeting the financial costs of capital
28 projects. The money shall be paid by the State Treasurer to
29 those departments, agencies or authorities authorized to expend
30 it as required by them to pay financial costs at the time the
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1 department, agency or authority certifies the payment to be due
2 and payable.
3 (c) Investment.--Pending their application to the purposes
4 authorized, money held or deposited by the State Treasurer may
5 be invested and reinvested as are other funds in the custody of
6 the State Treasurer in the manner provided by law. Earnings
7 received from the investment or deposit of the funds shall be
8 paid into the State Treasury to the credit of the account in the
9 Capital Facilities Fund to which the funds were originally
10 deposited.
11 § 9111. Capital Debt Fund; investments; redemption of bonds.
12 (a) Capital Debt Fund.--Bonds issued under this chapter
13 shall be paid at maturity. Interest due after July 1, 1968, on
14 bonds and on notes issued under this chapter shall be paid by
15 the Board of Finance and Revenue from the Capital Debt Fund. The
16 General Assembly shall appropriate annually the money necessary
17 to pay the interest on the bonds and notes and the principal of
18 the bonds and notes at maturity if no other provision is made.
19 Money appropriated shall be paid into the Capital Debt Fund by
20 the State Treasurer.
21 (b) Investment.--Money received under subsection (a) prior
22 to the date for disbursement shall be invested by the board
23 pending disbursement in securities as are provided by law for
24 the investment of surplus money of the Commonwealth. The
25 investment and the accumulations in the Capital Debt Fund shall
26 be devoted to and be used exclusively for the payment of the
27 interest accruing on the bonds and notes and for the redemption
28 of the bonds and notes at maturity or upon the redemption date
29 if called for prior redemption. The board is authorized to use
30 such funds for the purchase and retirement of all or any part of
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1 the bonds issued under this chapter; but no purchase may be made
2 which will reduce the money in the Capital Debt Fund below the
3 amount necessary to pay all principal and interest still to
4 become due in the fiscal year of the purchase. If all or any
5 part of any bonds issued under this chapter are purchased by the
6 Commonwealth, they shall be canceled and returned to the State
7 Treasurer as canceled and paid bonds. Thereafter, all payment of
8 interest on the bonds shall cease; and the canceled bonds and
9 coupons shall be destroyed in accordance with the act of April
10 27, 1925 (P.L.319, No.180), entitled, "An act relating to the
11 destruction of canceled or unused bonds or other evidences of
12 indebtedness of this Commonwealth."
13 § 9112. Funding bonds.
14 The issuing officials, subject to the provisions of a bond
15 resolution or trust indenture, are authorized to issue funding
16 bonds for the purpose of refunding obligations then outstanding
17 to provide funds to redeem and retire such outstanding
18 obligations with accrued interest and any premium payable
19 thereon at maturity or any call date. The issuance of funding
20 bonds, the maturities and other details, the rights of the
21 holders and the duties of the issuing officials shall be
22 governed by the applicable provisions of sections 9103 (relating
23 to procedures for capital budget bill and debt-authorizing
24 legislation) through 9111 (relating to Capital Debt Fund;
25 investments; redemption of bonds). Funding bonds may be issued
26 to refund bonds previously issued for refunding purposes. The
27 proceeds of the sale of funding bonds shall be paid to the State
28 Treasurer and applied to the payment of the principal of, and
29 any accrued interest and premium on, the bonds or notes for the
30 refunding of which funding bonds have been issued. No funding
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1 bonds shall be issued having a stated maturity date later than
2 the expiration of the useful life of the capital projects
3 constructed or acquired from the proceeds of the debt originally
4 incurred in respect of the bonds or notes being refunded, nor
5 shall funding bonds be issued to refund beyond the same fiscal
6 year any portion of debt required by this chapter and the
7 Constitution of Pennsylvania to be retired in the year of issue
8 of the funding bonds in order to comply with the retirement in
9 substantial and regular amounts as provided in section 9107(d)
10 (relating to bonds, issue of bonds and notes, maturity,
11 interest).
12 § 9113. Reporting requirements.
13 The State Treasurer shall determine and report to the
14 Secretary of the Budget and the chairman and minority chairman
15 of the Appropriations Committee of the Senate and the chairman
16 and minority chairman of the Appropriations Committee of the
17 House of Representatives by January 1 of each year the amount of
18 money necessary for the payment of interest on outstanding
19 obligations and the principal of the obligations for the
20 following fiscal year and the time and amounts of payments.
21 § 9114. Registration of bonds.
22 The Auditor General shall prepare the necessary registry
23 books to be kept in the office of the authorized loan and
24 transfer agent of the Commonwealth for the registration of any
25 bonds of the Commonwealth according to the terms and conditions
26 of issue specified by the issuing officials under section
27 9107(d) (relating to bonds, issue of bonds and notes, maturity,
28 interest). Bonds issued without interest coupons attached shall
29 be registered in the registry books kept by the authorized loan
30 and transfer agent of the Commonwealth.
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1 § 9115. Voting requirements.
2 If this chapter requires an action to be taken or a decision
3 to be made by the issuing officials and the three officers shall
4 not be able to agree unanimously, the action or decision of the
5 Governor and either the Auditor General or State Treasurer shall
6 be binding and final.
7 § 9116. Appropriation.
8 The money received by the Commonwealth from the issuance and
9 sale of bonds and notes pursuant to this chapter and any debt-
10 authorizing act adopted after July 23, 1984, shall be
11 appropriated by the General Assembly from the Capital Facilities
12 Fund in the debt-authorizing acts for the purposes set forth in
13 those acts.
14 § 9117. Appropriation for and limitation on redevelopment
15 assistance and site development capital projects.
16 (a) Appropriation.--The amount necessary to pay principal of
17 and interest on all obligations issued to provide funds for
18 redevelopment assistance capital projects and site development
19 capital projects is hereby appropriated from the General Fund
20 and shall be transferred to the Capital Debt Fund upon
21 authorization by the Governor.
22 (b) Limitation.--
23 (1) The maximum amount of redevelopment assistance
24 capital projects undertaken by the Commonwealth for which
25 obligations are outstanding shall not exceed, in the
26 aggregate, $1,550,000,000. On or after the effective date of
27 this section, at least $100,000,000 shall be specifically set
28 aside for projects for the construction of or improvements to
29 hospital facilities.
30 (2) The maximum amount of site development capital
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1 projects for which obligations are outstanding shall not
2 exceed, in the aggregate, $100,000,000.
3 § 9118. Funding and administration of redevelopment assistance
4 capital projects.
5 (a) Applications.--Persons seeking funding for redevelopment
6 assistance capital projects itemized in accordance with section
7 9103(b) (relating to procedures for capital budget bill and
8 debt-authorizing legislation) may request an application from
9 the Office of the Budget. Completed applications shall be
10 submitted to the Office of the Budget which shall review them to
11 determine if the proposed project meets the definition of
12 redevelopment assistance capital project and for compliance with
13 application requirements, including the submission of all
14 project descriptions, schedules, budgets and other materials as
15 may be required. Deficient applications shall be returned to the
16 applicant for revision. Applications found to be complete by the
17 Office of the Budget shall be forwarded to the Secretary of the
18 Budget for review.
19 (b) Review and approval.--The Secretary of the Budget, in
20 consultation with the Secretary of Community and Economic
21 Development, shall review completed applications and shall
22 approve or disapprove applications for redevelopment assistance
23 capital projects. If an application is approved, the Secretary
24 of the Budget shall execute a grant agreement or contract with
25 the applicant. State funding for approved redevelopment
26 assistance projects shall be paid in accordance with subsection
27 (c).
28 (c) Time period.--State funding for approved redevelopment
29 assistance capital projects shall be paid over not less than a
30 36-month period unless the Secretary of the Budget authorizes a
20030S0010B1501 - 157 -
1 shorter period.
2 (d) Costs.--Fees for professional services incurred for the
3 design and construction of redevelopment assistance capital
4 projects shall be paid from non-State funds. Land acquisition is
5 a permissible State-funded expenditure if the acquisition cost
6 is supported by an appraisal done by a certified appraiser.
7 (e) Proportion.--Expenditure of State and non-State funds
8 shall be made on a proportional basis for direct land and
9 building acquisition costs and construction expenses.
10 (f) Verification.--Redevelopment assistance capital project
11 cost estimates must be verified by the Office of the Budget or
12 its designated agent before final approval is given to a project
13 application. Cost estimates include total project cost,
14 projected use for State and non-State funds and a year-by-year
15 schedule of costs for the entire project construction phase.
16 (g) Bids.--
17 (1) Notwithstanding any other provisions of law and
18 subject to paragraph (2), the solicitation of a minimum of
19 three written bids for all contracted construction work on
20 redevelopment assistance capital projects shall be the sole
21 requirement for the composition, solicitation, opening and
22 award of bids on such projects.
23 (2) The construction work shall be performed subject to
24 the act of March 3, 1978 (P.L.6, No.3), known as the Steel
25 Products Procurement Act.
26 (h) Review and audit.--Redevelopment assistance capital
27 projects shall be reviewed at regular intervals by the Office of
28 the Budget or its designated agent during the funding phase to
29 ensure financial and program compliance. A final closeout audit
30 shall be performed by the Office of the Budget or its designated
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1 agent for all projects. Copies of closeout audits shall be
2 provided to the committee by the Office of the Budget upon
3 completion.
4 (i) Grant administration.--In the event an applicant does
5 not administer the grant, the applicant shall enter into a
6 cooperation agreement with the entity administering the grant
7 which agreement shall be subject to the approval of the Office
8 of the Budget.
9 § 9119. Funding and administration of site development capital
10 projects.
11 (a) Applications.--Persons seeking funding for site
12 development capital projects itemized in a capital budget
13 itemization act may request an application from the Office of
14 the Budget. Completed applications shall be submitted to the
15 Office of the Budget which shall review them to determine if the
16 proposed project meets the definition of site development
17 capital project and for compliance with application
18 requirements, including the submission of all project
19 descriptions, schedules, budgets and other materials as may be
20 required. Deficient applications shall be returned to the
21 applicant for revision. Applications found to be complete by the
22 Office of the Budget shall be forwarded to the committee for
23 review. The Secretary of the Budget may recommend projects to
24 the committee for approval. The committee shall not be bound by
25 a recommendation by the Secretary of the Budget.
26 (b) Review.--The following shall apply:
27 (1) The committee shall review an application for a site
28 development capital project to determine all of the
29 following:
30 (i) If the project locations are suitable for the
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1 siting of business, industrial or research facilities.
2 (ii) If the project creates opportunities to develop
3 new facilities or to expand existing facilities for
4 business, service industries, manufacturing, research and
5 development or other business or industrial operations
6 that produce goods or services.
7 (iii) If the project will result in the creation of
8 new jobs or the preservation of existing jobs.
9 (iv) If the project has 50% non-State participation
10 documented at the time of application.
11 (v) If the project has a total project cost of at
12 least $1,000,000.
13 (vi) If it is likely that the project will be
14 occupied by a business or industrial tenant within five
15 years of completion or any other reasonable period of
16 time as may be designated by the Secretary of Community
17 and Economic Development.
18 (2) The committee may consider the following when
19 reviewing site development capital projects:
20 (i) The geographic distribution of site development
21 capital projects throughout this Commonwealth.
22 (ii) The ratio of State share to non-State share of
23 the total project cost.
24 (c) Approval.--The following shall apply:
25 (1) The committee may approve a site development capital
26 project for which an application has been submitted if it
27 determines that the proposed project meets the requirements
28 of the definitions of site development capital project
29 contained in section 9102 (relating to definitions) and will
30 result in a significant positive impact as evidenced by the
20030S0010B1501 - 160 -
1 review criteria contained in subsection (b).
2 (2) Upon the approval of an application by the
3 committee, the Secretary of the Budget shall execute a grant
4 agreement or contract with the applicant. State funding for
5 approved site development capital projects shall be paid in
6 accordance with subsection (d).
7 (3) The Commonwealth shall not contract with or enter
8 into a grant agreement with an applicant for a site
9 development capital project itemized in a capital budget
10 itemization act for the purpose of providing funding unless
11 the project has been approved by at least four members of the
12 committee.
13 (d) Time period.--State funding for approved site
14 development capital projects shall be paid over not less than a
15 36-month period unless the Secretary of the Budget or the
16 committee authorizes a shorter period.
17 (e) Costs.--Fees for professional services incurred for the
18 design and construction of site development capital projects
19 shall be paid from non-State funds. Land acquisition shall be a
20 permissible State-funded expenditure if the acquisition cost is
21 supported by an appraisal done by a certified appraiser.
22 (f) Proportion.--Expenditure of State and non-State funds
23 shall be made on a proportional basis for direct land
24 acquisition costs and construction expenses.
25 (g) Verification.--Site development capital project cost
26 estimates must be verified by the Office of the Budget or its
27 designated agent before final approval is given to a project
28 application by the committee. Cost estimates shall include total
29 project cost, projected use for State and non-State funds and a
30 year-by-year schedule of costs for the entire project
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1 construction phase.
2 (h) Bids.--The following shall apply:
3 (1) Notwithstanding any other provisions of law and
4 subject to paragraph (2), the solicitation of a minimum of
5 three written bids for all contracted construction work on
6 site development capital projects shall be the sole
7 requirement for the composition, solicitation, opening and
8 award of bids on such projects.
9 (2) The construction work shall be performed subject to
10 the act of March 3, 1978 (P.L.6, No.3), known as the Steel
11 Products Procurement Act.
12 (i) Review and audit.--Site development capital projects
13 shall be reviewed at regular intervals by the Office of the
14 Budget or its designated agent during the funding phase to
15 ensure financial and program compliance. A final closeout audit
16 shall be performed by the Office of the Budget or its designated
17 agent for all projects. Copies of closeout audits shall be
18 provided to the committee by the Office of the Budget upon
19 completion.
20 (j) Grant administration.--In the event an applicant does
21 not administer the grant, the applicant shall enter into a
22 cooperation agreement with the entity administering the grant.
23 The cooperation agreement shall be subject to the approval of
24 the Office of the Budget.
25 § 9120. Capital Project Oversight and Review Committee.
26 (a) Establishment.--There is established a Capital Project
27 Oversight and Review Committee for the purpose of reviewing and
28 approving site development capital projects.
29 (b) Composition.--The following shall apply:
30 (1) The Capital Project Oversight and Review Committee
20030S0010B1501 - 162 -
1 shall consist of:
2 (i) the Governor or a designee;
3 (ii) the Majority Leader of the Senate or a
4 designee;
5 (iii) the Minority Leader of the Senate or a
6 designee;
7 (iv) the Majority Leader of the House of
8 Representatives or a designee;
9 (v) the Minority Leader of the House of
10 Representatives or a designee.
11 (2) The Governor or the Governor's designee shall act as
12 chairman of the committee.
13 (3) The Secretary of the Budget shall act as the
14 committee secretary and shall provide staff support as
15 required by the committee. The Secretary of the Budget shall
16 not be a voting member of the committee.
17 (c) Meetings.--
18 (1) The committee shall meet at the call of the chairman
19 but at least once during each quarter of the fiscal year.
20 (2) Four members shall constitute a quorum.
21 (3) The consent of four members of the committee shall
22 be required to approve an application for a site development
23 capital project.
24 CHAPTER 92
25 SPORTS FACILITIES
26 Sec.
27 9201. Definitions.
28 9202. Commonwealth funds.
29 9203. Eligibility.
30 9204. Requirement.
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1 9205. Other agreements.
2 9206. Report.
3 9207. Financial commitment.
4 9208. Enforcement and penalties.
5 9209. Expiration.
6 9210. Scope.
7 § 9201. Definitions.
8 The following words and phrases when used in this chapter
9 shall have the meanings given to them in this section unless the
10 context clearly indicates otherwise:
11 "Baseline tax amount." The average of taxes referred to in
12 section 9204(7)(i) (relating to requirement) paid to the
13 Commonwealth in 1996, 1997 and 1998.
14 "Contracting authority." An authority created pursuant to 53
15 Pa.C.S. Ch. 56 (relating to municipal authorities), for the
16 purpose of constructing or renovating a facility or other
17 authority established under the laws of this Commonwealth which
18 is eligible to apply for and receive redevelopment assistance
19 capital grants under Chapter 91 (relating to capital facilities)
20 under a contract with the office to receive Commonwealth grants
21 under this chapter.
22 "Contracting municipality." A city, county, township, town
23 or borough which contracts with the office to receive
24 Commonwealth funds to construct or renovate a facility.
25 "Facility." A stadium, arena or other place owned or leased
26 by a professional sports organization at which a professional
27 athletic event is conducted in the presence of individuals who
28 pay admission to view the event. The term includes a facility to
29 be constructed as well as an existing facility.
30 "Office." The Office of the Budget.
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1 "Professional sports organization." A sole proprietorship,
2 corporation, limited liability company, partnership or
3 association that:
4 (1) owns a professional major league baseball or
5 national football franchise; and
6 (2) conducts professional athletic events of the
7 franchise at a facility.
8 § 9202. Commonwealth funds.
9 The receipt of grants of Commonwealth funds by a contracting
10 municipality or contracting authority under Chapter 91 (relating
11 to capital facilities) or this chapter to finance any cost
12 related to the construction or renovation of a facility shall be
13 subject to the requirements of this chapter.
14 § 9203. Eligibility.
15 In order for a facility to qualify for grants of Commonwealth
16 funds, the professional sports organization utilizing the
17 facility must certify that:
18 (1) it maintains its headquarters, principal business
19 offices, training facilities and camps, except baseball
20 spring training, and related enterprises and activities,
21 except minor league activities, in this Commonwealth;
22 (2) except for a sole proprietorship, it is
23 incorporated, organized or otherwise created under the laws
24 of this Commonwealth; and
25 (3) it will continue to comply with the certifications
26 under paragraphs (1) and (2) for the duration of the lease
27 under section 9204(1) (relating to requirement) or for the
28 initial term of the debt, whichever is longer.
29 § 9204. Requirement.
30 In order for grants of Commonwealth funds to be used to
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1 construct or renovate a facility, the contracting municipality
2 or contracting authority must contract with the professional
3 sports organization to ensure compliance by the professional
4 sports organization with the following terms and conditions:
5 (1) Agreement by the professional sports organization to
6 remain and conduct professional sporting events in the
7 facility for the duration of the lease or for the term of any
8 debt of the Commonwealth, whichever is longer, but in no
9 event longer than 29.5 years. The contract shall include
10 agreement by the professional sports organization that if the
11 agreement to remain and conduct professional sporting events
12 is violated, the contracting municipality or contracting
13 authority shall seek specific performance of the agreement to
14 remain and conduct professional sporting events or receive a
15 payment in the amount set forth in the agreement between the
16 contracting municipality or contracting authority and the
17 professional sports organization and the amount equal to the
18 Commonwealth's principal contribution under Chapter 91
19 (relating to capital facilities) or this chapter to the
20 construction or renovation of the facility.
21 (2) Establishment of a procedure to provide written
22 notice by the professional sports organization to the
23 contracting municipality or contracting authority and the
24 Commonwealth of any sale, transfer or relocation of its
25 sports franchise or team immediately upon entering into any
26 commitment to sell, transfer or relocate the sports franchise
27 or team.
28 (3) Agreement that if the professional sports
29 organization sells or transfers its sports franchise or team,
30 the purchaser or transferee shall be bound by and shall
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1 contract to be subject to the same terms and conditions
2 required by this chapter as a condition of the sale.
3 (4) Agreement that all costs of design and construction
4 of a new or renovated facility which are due to delays or
5 which exceed the projected costs set forth in the financial
6 plan or contract with the office shall be the responsibility
7 of the contracting municipality or contracting authority or
8 the professional sports organization.
9 (5) Agreement that during the term of the lease for the
10 facility, the professional sports organization or the
11 contracting municipality or contracting authority shall be
12 responsible for all capital improvements to the facility and
13 for all operating expenses relating to the use of the
14 facility, including security, cleaning, insurance,
15 maintenance and utilities.
16 (6) Agreement to set aside a specified minimum number of
17 days, at reasonable times throughout the year, to be
18 available for the use of the facility by the contracting
19 municipality or contracting authority or by the Commonwealth.
20 Under this agreement, the Commonwealth shall receive the same
21 number of days and be entitled to the same terms as the
22 contracting municipality or contracting authority.
23 (7) Agreement to make an additional rental payment of
24 $25,000,000 reduced by available credits under subparagraphs
25 (i) through (iii) in the tax year immediately following the
26 expiration of the first ten-year period of occupancy or lease
27 of the facility and at the expiration of every ten-year
28 period thereafter. The professional sports organization shall
29 pay the additional rental payment to the contracting
30 municipality or contracting authority, which shall remit the
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1 additional rental payment to the Commonwealth. The additional
2 rental payment made by the professional sports organization
3 shall be reduced by the following credits:
4 (i) The credits available for the first ten-year
5 period of occupancy or lease shall be amounts paid to the
6 Commonwealth which exceed the product of the baseline tax
7 amount multiplied by 7.5. The credits available for each
8 subsequent ten-year period of occupancy shall be the
9 amounts paid to the Commonwealth which exceed the product
10 of the baseline tax amount multiplied by 10. Available
11 credits include all of the following:
12 (A) An amount equal to all corporate net income
13 tax, capital stock and franchise tax and personal
14 income tax related to the ownership and operation of
15 the professional sports organization.
16 (B) An amount equal to:
17 (I) all personal income tax withheld from
18 its employees by the professional sports
19 organization;
20 (II) all personal income tax withheld from
21 the employees of any provider of events at or
22 services to, or any operator of an enterprise in,
23 a facility or facility complex; and
24 (III) all personal income tax to which the
25 Commonwealth would be entitled from performers or
26 other participants, including visiting teams, at
27 an event or activity at the facility.
28 (C) An amount equal to all sales and use tax
29 related to the operation of the professional sports
30 organization and the facility and enterprises
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1 developed as part of the facility complex. This
2 clause includes sales and use tax paid by any
3 provider of events or activities at or services to a
4 facility, including sales and use tax paid by vendors
5 and concessionaires and contractors at the facility.
6 (D) An amount equal to all tax paid, by the
7 professional sports organization or by any provider
8 of events or activities at or services to a facility,
9 to the Commonwealth related to the sale of any
10 liquor, wine or malt or brewed beverage in the
11 facility or facility complex.
12 (E) The amount paid by the professional sports
13 organization or by any provider of events or
14 activities at or services to a facility or facility
15 complex of any new tax enacted by the Commonwealth
16 after February 9, 1999.
17 (ii) In addition to the credits available under
18 subparagraph (i), the professional sports organization
19 may credit an amount equal to one-third of the following,
20 incurred prior to the occupancy or lease of the facility:
21 (A) all personal income tax withheld from
22 personnel by the professional sports organization or
23 by a contractor or other entity involved in the
24 construction or renovation of the facility; and
25 (B) sales and use tax paid on materials and
26 other construction costs, whether withheld or paid by
27 the professional sports organization or other entity,
28 directly related to the construction or renovation of
29 the facility.
30 (iii) To the extent the amount of the credits
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1 available for a specific ten-year period under
2 subparagraphs (i) and (ii) exceeds $25,000,000, the
3 excess may be carried over and added to the amount of
4 credits claimed under subparagraphs (i) and (ii) for the
5 following ten-year period. Any excess credit still
6 remaining shall be carried over to subsequent ten-year
7 periods until it is exhausted or until the expiration of
8 this chapter under section 9209 (relating to expiration),
9 whichever is sooner.
10 (iv) Payments shall be made by the professional
11 sports organization and remitted by the contracting
12 municipality or contracting authority at a time and in a
13 manner, including required documentation of all credits,
14 as the office prescribes. This subparagraph includes
15 annual reconciliation of all credits under subparagraphs
16 (i) through (iii). All tax records and information shall
17 be subject to all confidentiality protections provided by
18 the act of March 4, 1971 (P.L.6, No.2), known as the Tax
19 Reform Code of 1971; however, the Department of Revenue
20 shall provide records and information to the office as
21 necessary for the office to enforce this chapter.
22 (8) An agreement that, upon sale of the facility or the
23 expiration or termination of the lease at the facility, the
24 Commonwealth shall have an option to purchase for $1 a one-
25 third interest in the facility.
26 § 9205. Other agreements.
27 The contracting municipality or the contracting authority and
28 the professional sports organization may enter into all other
29 agreements necessary and appropriate for the construction,
30 renovation and operation of the facility. The contracting
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1 municipality or the contracting authority shall enter into all
2 contracts with the office required to receive Commonwealth
3 funds.
4 § 9206. Report.
5 The office shall file a report every ten years to the General
6 Assembly regarding the additional rental payments under this
7 chapter.
8 § 9207. Financial commitment.
9 The contracting municipality or contracting authority and the
10 professional sports organization must provide to the office all
11 of the following:
12 (1) A financial plan for all funding related to the
13 construction or renovation of the facility, to include
14 details regarding the financial commitment of the parties to
15 the project.
16 (2) An economic development plan for the area
17 surrounding the facility.
18 (3) A plan to provide affordable seating within a
19 portion of the facility.
20 (4) A representation from the contracting municipality
21 or contracting authority that tax revenues to the
22 Commonwealth will be increased and a description of how the
23 grant of Commonwealth funds will provide the increase.
24 § 9208. Enforcement and penalties.
25 (a) Injunction.--The Commonwealth may enjoin a violation of
26 section 9204 (relating to requirement).
27 (b) Withhold funding.--The Commonwealth has the right to
28 withhold funding under this chapter and to exercise all rights
29 and remedies at law or in equity for any of the following:
30 (1) Failure of a professional sports organization to
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1 comply with the provisions of this chapter in a timely and
2 appropriate manner.
3 (2) A violation of a covenant under any agreement with
4 or for the benefit of the Commonwealth relating to the
5 construction or renovation or use of the facility.
6 (3) Any other violation of law applicable to the
7 construction or renovation or use of the facility.
8 (c) Civil penalty.--A person that intentionally, recklessly
9 or negligently violates this chapter shall be subject to a civil
10 penalty of up to $100,000 per violation.
11 (d) Criminal penalty.--A person that intentionally or
12 knowingly provides false or fraudulent information or makes a
13 material misrepresentation under this chapter commits a
14 misdemeanor of the third degree.
15 § 9209. Expiration.
16 This chapter shall cease to apply to each participating
17 professional sports organization 30 years following the
18 occupancy or lease of the facility.
19 § 9210. Scope.
20 This issuance of grants under this chapter is subject to
21 Chapter 91.
22 Section 2.1. The addition of 12 Pa.C.S. § 3503 is intended
23 to be in pari materia with section 103 of the act of October 6,
24 1998 (P.L.705, No.92), known as the Keystone Opportunity Zone
25 and Keystone Opportunity Expansion Zone Act.
26 Section 2.2. The Pennsylvania Economic Development Financing
27 Authority is authorized to incur debt on behalf of the
28 Commonwealth in an amount equal to the remaining debt authorized
29 by section 16 of act of March 1, 1988 (P.L.82, No.16), known as
30 the Pennsylvania Infrastructure Investment Authority Act, for
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1 loans under 12 Pa.C.S. § 4321.
2 Section 3. Repeals are as follows:
3 (1) Sections 6.1, 6.2, 6.3, 6.4, 6.5, 6.6, 6.7 and 6.8
4 of the act of August 23, 1967 (P.L.251, No.102), known as the
5 Economic Development Financing Law, are repealed.
6 (2) The following provisions of the act of June 29, 1996
7 (P.L.434, No.67), known as the Job Enhancement Act, are
8 repealed:
9 (i) Chapter 3.
10 (ii) Chapter 7.
11 (iii) Chapter 13.
12 (iv) Chapter 17.
13 (2.1) Chapter 3 of the act of October 6, 1998 (P.L.705,
14 No.92), known as the Keystone Opportunity Zone and Keystone
15 Opportunity Expansion Zone Act, is repealed.
16 (2.2) The following apply:
17 (i) Except as set forth in subparagraph (ii), the
18 act of February 9, 1999 (P.L.1, No.1), known as the
19 Capital Facilities Debt Enabling Act, is repealed.
20 (ii) Section 301 of the Capital Facilities Debt
21 Enabling Act is saved from repeal.
22 (3) Section 305(e) of the act of June 26, 2001 (P.L.755,
23 No.77), known as the Tobacco Settlement Act, is repealed.
24 (4) All acts and parts of acts are repealed insofar as
25 they are inconsistent with this act.
26 Section 4. Chapters 3, 7, 13, and 17 of the act of June 29,
27 1996 (P.L.434, No.67), known as the Job Enhancement Act, are
28 continued by this codification as follows:
29 (1) The addition of 12 Pa.C.S. Ch. 3 is a continuation
30 of Chapter 3 of the Job Enhancement Act. The following apply:
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1 (i) Except as otherwise provided in 12 Pa.C.S. Ch.
2 3, all activities initiated under Chapter 3 of the Job
3 Enhancement Act shall continue and remain in full force
4 and effect and may be completed under 12 Pa.C.S. Ch. 3.
5 Orders, regulations, rules and decisions which were made
6 under Chapter 3 of the Job Enhancement Act and which are
7 in effect on the effective date of section 3(2)(i) of
8 this act shall remain in full force and effect until
9 revoked, vacated or modified under 12 Pa.C.S. Ch. 3.
10 Contracts, obligations and collective bargaining
11 agreements entered into under Chapter 3 of the Job
12 Enhancement Act are not affected nor impaired by the
13 repeal of Chapter 3 of the Job Enhancement Act.
14 (ii) Any difference in language between 12 Pa.C.S.
15 Ch. 3 and Chapter 3 of the Job Enhancement Act is
16 intended only to conform to the style of the Pennsylvania
17 Consolidated Statutes and is not intended to change or
18 affect the legislative intent, judicial construction or
19 administration and implementation of Chapter 3 of the Job
20 Enhancement Act.
21 (2) The addition of 12 Pa.C.S. Ch. 5 is a continuation
22 of Chapter 17 of the Job Enhancement Act. The following
23 apply:
24 (i) All activities initiated under the Chapter 17 of
25 the Job Enhancement Act shall continue and remain in full
26 force and effect and may be completed under 12 Pa.C.S.
27 Ch. 5. Orders, regulations, rules and decisions which
28 were made under Chapter 17 of the Job Enhancement Act and
29 which are in effect on the effective date of section
30 3(2)(iv) of this act shall remain in full force and
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1 effect until revoked, vacated or modified under 12
2 Pa.C.S. Ch. 5. Contracts, obligations and collective
3 bargaining agreements entered into under Chapter 17 of
4 the Job Enhancement Act are not affected nor impaired by
5 the repeal of Chapter 17 of the Job Enhancement Act.
6 (ii) Except as set forth in subparagraph (iii), any
7 difference in language between 12 Pa.C.S. Ch. 5 and
8 Chapter 17 of the Job Enhancement Act is intended only to
9 conform to the style of the Pennsylvania Consolidated
10 Statutes and is not intended to change or affect the
11 legislative intent, judicial construction or
12 administration and implementation of Chapter 17 of the
13 Job Enhancement Act.
14 (iii) Subparagraph (ii) does not apply to the
15 following:
16 (A) The addition of 12 Pa.C.S. § 502.
17 (B) The addition of 12 Pa.C.S. § 503.
18 (iv) The members of Small Business Council in office
19 on the effective date of section 3(2)(iv) of this act
20 shall continue in office under the addition of 12 Pa.C.S.
21 Ch. 5.
22 (3) The addition of 12 Pa.C.S. Ch. 21 is a continuation
23 of Chapter 7 of the Job Enhancement Act. The following apply:
24 (i) Except as otherwise provided in 12 Pa.C.S. Ch.
25 21, all activities initiated under the Chapter 7 of the
26 Job Enhancement Act shall continue and remain in full
27 force and effect and may be completed under 12 Pa.C.S.
28 Ch. 21. Orders, regulations, rules and decisions which
29 were made under Chapter 7 of the Job Enhancement Act and
30 which are in effect on the effective date of section
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1 3(2)(ii) of this act shall remain in full force and
2 effect until revoked, vacated or modified under 12
3 Pa.C.S. Ch. 21. Contracts, obligations and collective
4 bargaining agreements entered into under Chapter 7 of the
5 Job Enhancement Act are not affected nor impaired by the
6 repeal of Chapter 7 of the Job Enhancement Act.
7 (ii) Except as set forth in subparagraph (iii), any
8 difference in language between 12 Pa.C.S. Ch. 21 and
9 Chapter 7 of the Job Enhancement Act is intended only to
10 conform to the style of the Pennsylvania Consolidated
11 Statutes and is not intended to change or affect the
12 legislative intent, judicial construction or
13 administration and implementation of Chapter 7 of the Job
14 Enhancement Act.
15 (iii) Subparagraph (ii) does not apply to any of the
16 following provisions:
17 (A) The addition of 12 Pa.C.S. § 2106(2).
18 (B) The addition of 12 Pa.C.S. § 2109(b).
19 (4) The addition of 12 Pa.C.S. Ch. 23 is a continuation
20 of Chapter 13 of the Job Enhancement Act. The following
21 apply:
22 (i) Except as otherwise provided in 12 Pa.C.S. Ch.
23 23, all activities initiated under the Chapter 13 of the
24 Job Enhancement Act shall continue and remain in full
25 force and effect and may be completed under 12 Pa.C.S.
26 Ch. 23. Orders, regulations, rules and decisions which
27 were made under Chapter 13 of the Job Enhancement Act and
28 which are in effect on the effective date of section
29 3(2)(iii) of this act shall remain in full force and
30 effect until revoked, vacated or modified under 12
20030S0010B1501 - 176 -
1 Pa.C.S. Ch. 23. Contracts, obligations and collective
2 bargaining agreements entered into under Chapter 13 of
3 the Job Enhancement Act are not affected nor impaired by
4 the repeal of Chapter 13 of the Job Enhancement Act.
5 (ii) Except as set forth in subparagraph (iii), any
6 difference in language between 12 Pa.C.S. Ch. 23 and
7 Chapter 13 of the Job Enhancement Act is intended only to
8 conform to the style of the Pennsylvania Consolidated
9 Statutes and is not intended to change or affect the
10 legislative intent, judicial construction or
11 administration and implementation of Chapter 13 of the
12 Job Enhancement Act.
13 (iii) Subparagraph (ii) does not apply to any of the
14 following provisions:
15 (A) The addition of 12 Pa.C.S. § 2305(a).
16 (B) The addition of 12 Pa.C.S. § 2306(a), (b)
17 and (e).
18 (C) The addition of 12 Pa.C.S. § 2308(a) and
19 (b).
20 (D) The addition of 12 Pa.C.S. § 2309(b).
21 (E) The addition of 12 Pa.C.S. § 2310(b).
22 (iv) In continuation of section 1302 of the Job
23 Enhancement Act, all funds, accounts, assets,
24 encumbrances and liabilities located in or associated
25 with the Air Quality Improvement Fund, the Storage Tank
26 Loan Fund and the Recycling Incentive Development Account
27 shall be transferred to the Pollution Prevention
28 Assistance Account and shall be administered in
29 accordance with 12 Pa.C.S. §§ 2304 and 2309. The
30 Department of Community and Economic Development shall
20030S0010B1501 - 177 -
1 report annually to the Department of Environmental
2 Protection on the status of the Pollution Prevention
3 Assistance Account and the loans made under 12 Pa.C.S. §
4 2309.
5 (v) In continuation of section 1309(a) of the Job
6 Enhancement Act, as of July 1, 1997, all funds, accounts,
7 assets, encumbrances and liabilities located in or
8 associated with the Capital Loan Fund shall be
9 transferred to the Small Business First Fund and shall
10 thereafter be administered in accordance with 12 Pa.C.S.
11 Ch. 23.
12 (vi) In continuation of section 1309(b) of the Job
13 Enhancement Act, annually on July 1, the State Treasurer
14 may transfer, upon approval by the Governor, up to
15 $2,000,000 from the Hazardous Sites Cleanup Fund into the
16 Pollution Prevention Assistance Account. This transfer
17 shall be in addition to other appropriations, Federal
18 funding and private contributions received by the
19 account.
20 Section 4.1. The addition of 12 Pa.C.S. Ch. 35 is a
21 continuation of Chapter 3 of the act of October 6, 1998
22 (P.L.705, No.92), known as the Keystone Opportunity Zone and
23 Keystone Opportunity Expansion Zone Act. The following apply:
24 (1) Except as otherwise provided in 12 Pa.C.S. Ch. 35,
25 all activities initiated under Chapter 3 of the Keystone
26 Opportunity Zone and Keystone Opportunity Expansion Zone Act
27 shall continue and remain in full force and effect and may be
28 completed under 12 Pa.C.S. Ch. 35. Orders, regulations, rules
29 and decisions which were made under Chapter 3 of the Keystone
30 Opportunity Zone and Keystone Opportunity Expansion Zone Act
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1 and which are in effect on the effective date of section
2 3(2.1) of this act shall remain in full force and effect
3 until revoked, vacated or modified under 12 Pa.C.S. Ch. 35.
4 Contracts, obligations and collective bargaining agreements
5 entered into under Chapter 3 of the Keystone Opportunity Zone
6 and Keystone Opportunity Expansion Zone Act are not affected
7 nor impaired by the repeal of Chapter 3 of the Keystone
8 Opportunity Zone and Keystone Opportunity Expansion Zone Act.
9 (2) Except as set forth in paragraph (3), any difference
10 in language between 12 Pa.C.S. Ch. 35 and Chapter 3 of the
11 Keystone Opportunity Zone and Keystone Opportunity Expansion
12 Zone Act is intended only to conform to the style of the
13 Pennsylvania Consolidated Statutes and is not intended to
14 change or affect the legislative intent, judicial
15 construction or administration and implementation of Chapter
16 3 of the Keystone Opportunity Zone and Keystone Opportunity
17 Expansion Zone Act.
18 (3) Paragraph (2) does not apply to the following:
19 (i) The addition of 12 Pa.C.S. § 3512(e).
20 (ii) The addition of 12 Pa.C.S. § 3513(c).
21 (iii) The addition of 12 Pa.C.S. § 3514(c).
22 (iv) The addition of 12 Pa.C.S. § 3515(a) and (c).
23 Section 5. Sections 6.1, 6.2, 6.3, 6.4, 6.5, 6.6, 6.7 and
24 6.8 of the act of August 23, 1967 (P.L.251, No.102), known as
25 the Economic Development Financing Law, are continued by the
26 addition of 12 Pa.C.S. Ch. 43. The following apply:
27 (1) Except as otherwise provided in 12 Pa.C.S. Ch. 43,
28 all activities initiated under sections 6.1 through 6.8 of
29 the Economic Development Financing Law shall continue and
30 remain in full force and effect and may be completed under 12
20030S0010B1501 - 179 -
1 Pa.C.S. Ch. 43. Orders, regulations, rules and decisions
2 which were made under sections 6.1 through 6.8 of the
3 Economic Development Financing Law and which are in effect on
4 the effective date of section 3(1) of this act shall remain
5 in full force and effect until revoked, vacated or modified
6 under 12 Pa.C.S. Ch. 43. Contracts, obligations, collective
7 bargaining agreements and outstanding bonds entered into
8 under sections 6.1 through 6.8 of the Economic Development
9 Financing Law are not affected nor impaired by the repeal of
10 sections 6.1 through 6.8 of the Economic Development
11 Financing Law. The provisions of 12 Pa.C.S. Ch. 43 shall not
12 in any way impair or in any manner affect the rights and
13 remedies of obligees of the Pennsylvania Economic Development
14 Authority. Notwithstanding any other provision of 12 Pa.C.S.
15 Ch. 43, all such rights and remedies shall be preserved by 12
16 Pa.C.S. Ch. 43 and shall be and shall remain valid, binding
17 and enforceable in all respects. As used in this paragraph,
18 "obligees of the Pennsylvania Economic Development Authority"
19 shall mean the holders of any notes, bonds, refunding notes
20 and bonds, interim certificates, debentures and other
21 evidences of indebtedness, obligees of contracts or other
22 obligations of the Pennsylvania Economic Development
23 Authority established under the provisions of sections 6.1
24 through 6.8 of the Economic Development Finance Law.
25 (2) Except as set forth in paragraph (3), any difference
26 in language between 12 Pa.C.S. Ch. 43 and sections 6.1
27 through 6.8 of the Economic Development Financing Law is
28 intended only to conform to the style of the Pennsylvania
29 Consolidated Statutes and is not intended to change or affect
30 the legislative intent, judicial construction or
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1 administration and implementation of sections 6.1 through 6.8
2 of the Economic Development Financing Law.
3 (3) Paragraph (2) does not apply to any of the following
4 provisions:
5 (i) The addition of 12 Pa.C.S. § 4303(c).
6 (ii) The addition of 12 Pa.C.S. § 4305(b) and (c).
7 (iii) The addition of 12 Pa.C.S. § 4320.
8 (iv) The addition of 12 Pa.C.S. § 4321.
9 (v) The addition of 12 Pa.C.S. § 4322.
10 (vi) The addition of 12 Pa.C.S. § 4323.
11 (vii) The addition of 12 Pa.C.S. § 4324.
12 (viii) The addition of 12 Pa.C.S. § 4325.
13 (4) The members of board of the Pennsylvania Economic
14 Development Financing Authority in office on the effective
15 date of section 3(1) of this act shall continue in office
16 under the addition of 12 Pa.C.S. Ch. 43.
17 Section 5.1. The addition of 72 Pa.C.S. Ch. 91 is a
18 continuation of Chapter 3 of the act of February 9, 1999 (P.L.1,
19 No.1), known as the Capital Facilities Debt Enabling Act. The
20 following apply:
21 (1) Except as otherwise provided in 72 Pa.C.S. Ch. 91,
22 all activities initiated under Chapter 3 of the Capital
23 Facilities Debt Enabling Act shall continue and remain in
24 full force and effect and may be completed under 72 Pa.C.S.
25 Ch. 91.
26 (2) Orders, regulations, rules and decisions which were
27 made under Chapter 3 of the Capital Facilities Debt Enabling
28 Act and which are in effect on the effective date of section
29 3(2.2) of this act shall remain in full force and effect
30 until revoked, vacated or modified under 72 Pa.C.S. Ch. 91.
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1 (3) Contracts, obligations and collective bargaining
2 agreements entered into under Chapter 3 of the Capital
3 Facilities Debt Enabling Act are not affected nor impaired by
4 the repeal of the Capital Facilities Debt Enabling Act.
5 (4) Except as set forth in paragraph (5), any difference
6 in language between 72 Pa.C.S. Ch. 91 and Chapter 3 of the
7 Capital Facilities Debt Enabling Act is intended only to
8 conform to the style of the Pennsylvania Consolidated
9 Statutes and is not intended to change or affect the
10 legislative intent, judicial construction or administration
11 and implementation of Chapter 3 of the Capital Facilities
12 Debt Enabling Act.
13 (5) Paragraph (4) does not apply to any of the following
14 provisions:
15 (i) The addition of 72 Pa.C.S. § 9102.
16 (ii) The addition of 72 Pa.C.S. § 9103(b)(1)(ii).
17 (iii) The addition of 72 Pa.C.S. § 9107(c)(5).
18 (iv) The addition of 72 Pa.C.S. § 9113.
19 (v) The addition of 72 Pa.C.S. § 9117.
20 (vi) The addition of 72 Pa.C.S. § 9118(a), (g) and
21 (i).
22 (vii) The addition of 72 Pa.C.S. § 9119.
23 (viii) The addition of 72 Pa.C.S. § 9120.
24 Section 5.2. The addition of 72 Pa.C.S. Ch. 92 is a
25 continuation of Chapter 5 of the act of February 9, 1999 (P.L.1,
26 No.1), known as the Capital Facilities Debt Enabling Act. The
27 following apply:
28 (1) Except as otherwise provided in 72 Pa.C.S. Ch. 92,
29 all activities initiated under Chapter 5 of the Capital
30 Facilities Debt Enabling Act shall continue and remain in
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1 full force and effect and may be completed under 72 Pa.C.S.
2 Ch. 92.
3 (2) Orders, regulations, rules and decisions which were
4 made under Chapter 5 of the Capital Facilities Debt Enabling
5 Act and which are in effect on the effective date of section
6 3(2.2) of this act shall remain in full force and effect
7 until revoked, vacated or modified under 72 Pa.C.S. Ch. 92.
8 (3) Contracts, obligations and collective bargaining
9 agreements entered into under Chapter 5 of the Capital
10 Facilities Debt Enabling Act are not affected nor impaired by
11 the repeal of Chapter 5 of the Capital Facilities Debt
12 Enabling Act.
13 (4) Any difference in language between 72 Pa.C.S. Ch. 92
14 and Chapter 5 of the Capital Facilities Debt Enabling Act is
15 intended only to conform to the style of the Pennsylvania
16 Consolidated Statutes and is not intended to change or affect
17 the legislative intent, judicial construction or
18 administration and implementation of Chapter 5 of the Capital
19 Facilities Debt Enabling Act.
20 Section 6. The following apply to the Tobacco Settlement
21 Investment Board:
22 (1) The board is authorized to invest, in addition to
23 any amount invested on the effective date of this section in
24 venture capital, $30,000,000 in primary growth stage
25 investments:
26 (i) in which at least 70% of the investments will be
27 made in companies located primarily in this Commonwealth
28 or in companies willing to relocate significant business
29 operations to this Commonwealth; and
30 (ii) which are equitably distributed geographically
20030S0010B1501 - 183 -
1 throughout this Commonwealth.
2 (2) Primary growth stage investments must comply with
3 the requirements of section 305(a) and (g) of the act of June
4 26, 2001 (P.L.755, No.77), known as the Tobacco Settlement
5 Act.
6 Section 7. The following shall apply:
7 (1) Pursuant to the provisions of section 7(a)(3) of
8 Article VIII of the Constitution of Pennsylvania, the
9 question of incurring indebtedness of $250,000,000 for grants
10 and loans for the acquisition, repair, construction,
11 reconstruction, rehabilitation, extension, expansion and
12 improvement of water and wastewater infrastructure, including
13 water supply and sewage treatment systems, subject to
14 implementation through 12 Pa.C.S. § 4321, shall be submitted
15 to the electors at the next primary election following the
16 effective date of this section.
17 (2) The Secretary of the Commonwealth shall forthwith
18 certify the question to the county boards of elections.
19 (3) The question shall be in substantially the following
20 form:
21 Do you favor the incurring of indebtedness by the
22 Commonwealth in the amount of $250,000,000 for use as
23 grants and loans for construction, expansion and
24 improvement of water and wastewater infrastructure,
25 including water supply and sewage treatment systems?
26 Section 8. Appropriations are as follows:
27 (1) The sum of $10,000,000, or as much thereof as may be
28 necessary, is hereby appropriated to the Economic Enhancement
29 Fund for the fiscal year July 1, 2003, to June 30, 2004, to
30 carry out the provisions of 12 Pa.C.S. § 4324.
20030S0010B1501 - 184 -
1 (2) The sum of $2,000,000, or as much thereof as may be
2 necessary, is hereby appropriated to the Department of
3 Community and Economic Development for the fiscal year July
4 1, 2003, to June 30, 2004, for the following:
5 (i) For the Base Retention and Conversion
6 Pennsylvania Action Committee to develop a Statewide
7 strategy.
8 (ii) For matching grants for economic impact
9 studies, environmental impact studies, encroachment
10 studies, community and regional interaction with military
11 bases, infrastructure needs at military bases and job
12 training needs at or near military bases. Grants under
13 this subparagraph:
14 (A) shall be awarded by the Base Retention and
15 Conversion Pennsylvania Action Committee;
16 (B) require a 25% local match; and
17 (C) are limited to less than $75,000 per
18 military base.
19 Section 8.1. The addition of 12 Pa.C.S. § 3513(c) shall
20 apply retroactively to May 31, 2003.
21 Section 9. This act shall take effect July 1, 2003, or
22 immediately, whichever is later.
23 SECTION 1. TITLE 12 OF THE PENNSYLVANIA CONSOLIDATED <--
24 STATUTES IS AMENDED BY ADDING A CHAPTER TO READ:
25 CHAPTER 33
26 INFRASTRUCTURE AND FACILITIES IMPROVEMENT PROGRAM
27 SEC.
28 3301. SCOPE OF CHAPTER.
29 3302. DEFINITIONS.
30 3303. ESTABLISHMENT.
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1 3304. APPLICATION.
2 3305. REVIEW.
3 3306. APPROVAL.
4 § 3301. SCOPE OF CHAPTER.
5 THIS CHAPTER RELATES TO THE INFRASTRUCTURE AND FACILITIES
6 IMPROVEMENT PROGRAM.
7 § 3302. DEFINITIONS.
8 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS CHAPTER
9 SHALL HAVE THE MEANING GIVEN TO THEM IN THIS SECTION UNLESS THE
10 CONTEXT CLEARLY INDICATES OTHERWISE:
11 "APPLICANT." AN ISSUING AUTHORITY WHICH APPLIES FOR
12 FINANCIAL ASSISTANCE UNDER SECTION 3304 (RELATING TO
13 APPLICATION).
14 "CONVENTION CENTER." INTERESTS IN LAND, IMPROVEMENT,
15 STRUCTURE, BUILDINGS OR PART OF A BUILDING, WHETHER OWNED BY,
16 LEASED BY OR TO OR OTHERWISE ACQUIRED BY AN AUTHORITY WHICH ARE
17 APPROPRIATE FOR LARGE PUBLIC ASSEMBLIES, THE HOLDING OF
18 CONVENTIONS, CONFERENCES, TRADE EXHIBITIONS AND OTHER BUSINESS,
19 SOCIAL, CULTURAL, SCIENTIFIC AND PUBLIC INTEREST EVENTS.
20 "CONVENTION CENTER AUTHORITY." AN ENTITY CREATED UNDER ANY
21 OF THE FOLLOWING:
22 (1) ARTICLE XXV-A OF THE ACT OF JULY 28, 1953 (P.L.723,
23 NO.230), KNOWN AS THE SECOND CLASS COUNTY CODE.
24 (2) ARTICLE XXIII(N) AND (O) OF THE ACT OF AUGUST 9,
25 1955 (P.L.323, NO.130), KNOWN AS THE COUNTY CODE.
26 (3) 53 PA.C.S. CH. 56 (RELATING TO MUNICIPAL
27 AUTHORITIES) OR THE FORMER ACT OF MAY 2, 1945 (P.L. 382, NO.
28 164), KNOWN AS THE MUNICIPALITY AUTHORITIES ACT OF 1945 FOR
29 PURPOSES RELATED TO CONVENTION CENTERS.
30 (4) 64 PA.C.S. CH. 60 (RELATING TO PENNSYLVANIA
20030S0010B1501 - 186 -
1 CONVENTION CENTER AUTHORITY).
2 "COST OF A PROJECT." ANY OF THE FOLLOWING EXPENSES INCURRED
3 FOR A PROJECT:
4 (1) EXPENSES FOR THE ACQUISITION, CONSTRUCTION,
5 RECONSTRUCTION, EXPANSION, EXTENSION, DEMOLITION,
6 IMPROVEMENT, REHABILITATION OR REMODELING OF INTERESTS IN
7 LAND, BUILDINGS, STRUCTURES, IMPROVEMENTS OR INFRASTRUCTURE,
8 WHICH ARE PART OF THE PROJECT.
9 (2) EXPENSES FOR THE REMEDIATION OF EXISTING
10 ENVIRONMENTAL HAZARDS ON LAND WHERE THE PROJECT IS OR WILL BE
11 LOCATED.
12 (3) FINANCING CHARGES AND OTHER COSTS AND EXPENSES
13 INCURRED IN FINANCING AND ISSUING BONDS FOR THE PROJECT.
14 (4) COSTS AND EXPENSES OF ADMINISTRATIVE EXPENSES AND
15 PROFESSIONAL SERVICES, INCLUDING THE COSTS OF ENGINEERING,
16 FINANCIAL SERVICES, ACCOUNTING AND LEGAL SERVICES, RENDERED
17 IN COMPLETING THE PROJECT.
18 (5) COSTS AND EXPENSES ASSOCIATED WITH THE PREPARATION
19 OF PLANS, SPECIFICATIONS, STUDIES, AND SURVEYS, NECESSARY OR
20 INCIDENTAL TO DETERMINING THE FEASIBILITY OR PRACTICABILITY
21 OF CONSTRUCTING THE PROJECT.
22 "DEPARTMENT." THE DEPARTMENT OF COMMUNITY AND ECONOMIC
23 DEVELOPMENT OF THE COMMONWEALTH.
24 "HOSPITAL." A FACILITY OPERATED BY AN ENTITY LICENSED AS A
25 HOSPITAL UNDER THE ACT OF JUNE 13, 1967 (P.L.31, NO.21), KNOWN
26 AS THE PUBLIC WELFARE CODE OR THE ACT OF JULY 19, 1979 (P.L.130,
27 NO.48), KNOWN AS THE HEALTH CARE FACILITIES ACT, WHICH IS USED
28 TO PROVIDE INPATIENT CARE AND SERVICES.
29 "HOTEL ESTABLISHMENT." A HOTEL WHICH IS ASSOCIATED WITH A
30 CONVENTION CENTER.
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1 "INDUSTRIAL ENTERPRISE." AN ENTERPRISE OTHER THAN A
2 MERCANTILE, COMMERCIAL OR RETAIL ENTERPRISE, WHICH, BY VIRTUE OF
3 ITS SIZE, REQUIRES SUBSTANTIAL CAPITAL AND WILL CREATE
4 SIGNIFICANT EMPLOYMENT OPPORTUNITIES.
5 "INFRASTRUCTURE." ANY OF THE FOLLOWING:
6 (1) DRAINAGE AND STORM WATER SYSTEMS.
7 (2) ENERGY FACILITIES WHICH DISTRIBUTE ELECTRIC POWER.
8 (3) WASTEWATER SYSTEMS.
9 (4) TRANSPORTATION FACILITIES. THE TERM INCLUDES ROADS,
10 PARKING FACILITIES, SIDEWALKS, BRIDGES, RAILS, PORTS,
11 WATERWAYS AND AIRPORTS.
12 (5) PIPELINES FOR TRANSPORTING NATURAL GAS.
13 (6) FACILITIES FOR THE TRANSMISSION OF INFORMATION. THE
14 TERM INCLUDES TELECOMMUNICATION AND CABLE.
15 (7) WATER SUPPLY FACILITIES.
16 (8) INTERESTS IN LAND TO CONSTRUCT A FACILITY, PIPELINE
17 OR SYSTEM LISTED IN PARAGRAPHS (1) THROUGH (7).
18 (9) ENGINEERING, DESIGN AND INSPECTION COSTS ASSOCIATED
19 WITH THE CONSTRUCTION OF A FACILITY, PIPELINE OR SYSTEM
20 LISTED IN PARAGRAPHS (1) THROUGH (7).
21 "ISSUING AUTHORITY." ANY OF THE FOLLOWING:
22 (1) AN AUTHORITY CREATED UNDER THE ACT OF MAY 24, 1945
23 (P.L. 991, NO.385), KNOWN AS THE URBAN REDEVELOPMENT LAW.
24 (2) AN AUTHORITY CREATED UNDER ARTICLE XXV-A OF THE ACT
25 OF JULY 28, 1953 (P.L.723, NO.230), KNOWN AS THE SECOND CLASS
26 COUNTY CODE.
27 (3) ARTICLE XXIII(N) AND (O) OF THE ACT OF AUGUST 9,
28 1955 (P.L.323, NO.130), KNOWN AS THE COUNTY CODE.
29 (4) THE PENNSYLVANIA ECONOMIC DEVELOPMENT FINANCING
30 AUTHORITY OR AN AUTHORITY ESTABLISHED UNDER SECTION 4 OF THE
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1 ACT OF AUGUST 23, 1967 (P.L.251, NO.102), KNOWN AS THE
2 ECONOMIC DEVELOPMENT FINANCING LAW.
3 (5) AN ISSUING AUTHORITY AS DEFINED IN SECTION 3 OF THE
4 ACT OF JULY 11, 1990 (P.L.465, NO.113), KNOWN AS THE TAX
5 INCREMENT FINANCING ACT.
6 (6) AN AUTHORITY CREATED UNDER 53 PA.C.S. CH. 56
7 (RELATING TO MUNICIPAL AUTHORITIES) OR THE FORMER ACT OF MAY
8 2, 1945 (P.L. 382, NO. 164), KNOWN AS THE MUNICIPALITY
9 AUTHORITIES ACT OF 1945 FOR PURPOSES RELATED TO CONVENTION
10 CENTERS.
11 (7) AN AUTHORITY CREATED AND CONTINUED UNDER 64 PA.C.S.
12 CH. 60 (RELATING TO PENNSYLVANIA CONVENTION CENTER
13 AUTHORITY).
14 "MANUFACTURER." AN ENTITY WHICH IS ENGAGED IN THE GIVING OF
15 NEW SHAPES, NEW QUALITIES OR NEW COMBINATIONS TO MATTER BY THE
16 APPLICATION OF SKILL AND LABOR.
17 "PROJECT." AS FOLLOWS:
18 (1) IF THE PROJECT USER IS AN INDUSTRIAL ENTERPRISE OR
19 RETAIL ENTERPRISE:
20 (I) INFRASTRUCTURE.
21 (II) REMEDIATION OF ENVIRONMENTAL HAZARDS WHICH WERE
22 NOT CAUSED OR CONTRIBUTED TO BY THE APPLICANT OR THE
23 PROJECT USER.
24 (2) IF THE PROJECT USER IS A MANUFACTURER, HOSPITAL,
25 CONVENTION CENTER OR HOTEL ESTABLISHMENT:
26 (I) INFRASTRUCTURE.
27 (II) REMEDIATION OF ENVIRONMENTAL HAZARDS WHICH WERE
28 NOT CAUSED OR CONTRIBUTED TO BY THE APPLICANT OR THE
29 PROJECT USER.
30 (III) INTERESTS IN LAND, BUILDINGS, STRUCTURE OR
20030S0010B1501 - 189 -
1 IMPROVEMENTS REQUIRED BY THE PROJECT USER.
2 "PROJECT USER." AN INDUSTRIAL ENTERPRISE, RETAIL ENTERPRISE,
3 MANUFACTURER, HOSPITAL, CONVENTION CENTER OR HOTEL
4 ESTABLISHMENT, WHICH OWNS, LEASES OR USES ALL OR ANY PART OF A
5 PROJECT.
6 "RETAIL ENTERPRISE." AN ENTITY ENGAGED IN RETAIL SALES WHICH
7 CREATED OR WILL CREATE AT LEAST 200 FULL-TIME JOBS AND OCCUPIES
8 OR WILL OCCUPY AT LEAST A 200,000 SQUARE FOOT FACILITY.
9 "SECRETARY." THE SECRETARY OF COMMUNITY AND ECONOMIC
10 DEVELOPMENT OF THE COMMONWEALTH.
11 "YEAR." THE FISCAL YEAR OF THE COMMONWEALTH.
12 § 3303. ESTABLISHMENT.
13 THERE IS ESTABLISHED WITHIN THE DEPARTMENT A PROGRAM TO BE
14 KNOWN AS THE INFRASTRUCTURE AND FACILITIES IMPROVEMENT PROGRAM.
15 THE PROGRAM SHALL ENHANCE THE ECONOMIC DEVELOPMENT OF THE
16 COMMONWEALTH BY PROVIDING FINANCIAL ASSISTANCE IN THE FORM OF
17 MULTIYEAR GRANTS TO ISSUING AUTHORITIES TOWARD PAYMENT OF DEBT
18 SERVICE ON PROJECTS.
19 § 3304. APPLICATION.
20 AN ISSUING AUTHORITY MAY SUBMIT AN APPLICATION TO THE
21 DEPARTMENT REQUESTING FINANCIAL ASSISTANCE FOR A PROJECT. THE
22 APPLICATION MUST BE ON A FORM REQUIRED BY THE DEPARTMENT AND
23 MUST INCLUDE ALL OF THE FOLLOWING:
24 (1) THE NAME AND ADDRESS OF THE APPLICANT.
25 (2) THE NAME, ADDRESS AND STATE TAX IDENTIFICATION
26 NUMBERS OF THE PROJECT USER.
27 (3) A DESCRIPTION OF THE PROJECT. THE DESCRIPTION SHALL
28 INCLUDE ALL OF THE FOLLOWING:
29 (I) A DETAILED NARRATIVE DESCRIBING THE PROJECT AND
30 THE PROJECT USER.
20030S0010B1501 - 190 -
1 (II) A DETAILED STATEMENT OF THE COST OF THE
2 PROJECT. THE STATEMENT MUST INCLUDE THE AMOUNT AND TYPE
3 OF DEBT TO BE ISSUED BY THE APPLICANT FOR THE PROJECT,
4 THE IDENTITY OF THE PARTY RESPONSIBLE FOR REPAYMENT OF
5 THE DEBT AND THE COLLATERAL OR SECURITY TO BE PROVIDED.
6 (III) A STATEMENT OF THE NUMBER OF NET NEW FULL-TIME
7 JOBS TO BE CREATED BY THE PROJECT AND THE NUMBER OF
8 EXISTING FULL-TIME JOBS TO BE PRESERVED BY THE PROJECT.
9 (4) A STATEMENT OF THE AMOUNT OF GRANT FUNDS BEING
10 REQUESTED PER YEAR.
11 (5) A STATEMENT OF THE NUMBER OF YEARS A GRANT IS BEING
12 REQUESTED. IF THE APPLICANT IS REQUESTING A GRANT FOR A
13 PROJECT OF A PROJECT USER THAT IS AN INDUSTRIAL ENTERPRISE,
14 RETAIL ENTERPRISE OR A MANUFACTURER, THE REQUEST MAY NOT
15 EXCEED TEN YEARS. IF THE APPLICANT IS REQUESTING A GRANT FOR
16 A PROJECT OF A PROJECT USER THAT IS A HOSPITAL, CONVENTION
17 CENTER OR HOTEL ESTABLISHMENT, THE REQUEST MAY NOT EXCEED 20
18 YEARS.
19 (6) FINANCIAL INFORMATION FROM THE PROJECT USER PREPARED
20 OR REPORTED ON BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
21 PROJECTING FOR THE NEXT THREE YEARS ALL OF THE FOLLOWING:
22 (I) THE SALES OR EXPECTED SALES TAX COLLECTED OR TO
23 BE COLLECTED BY THE PROJECT USER FROM ACTIVITIES AS A
24 RESULT OF THE PROJECT.
25 (II) THE EXPECTED HOTEL OCCUPANCY TAX TO BE
26 COLLECTED BY THE PROJECT USER FROM ACTIVITIES AS A RESULT
27 OF THE PROJECT.
28 (III) THE EXPECTED NET INCREASE IN PERSONAL INCOME
29 TAX WITHHELD BY THE PROJECT USER AS AN EMPLOYER PURSUANT
30 TO ARTICLE III OF THE ACT OF MARCH 4, 1971 (P.L.6, NO.2),
20030S0010B1501 - 191 -
1 KNOWN AS THE TAX REFORM CODE OF 1971, FROM ACTIVITIES AS
2 A RESULT OF THE PROJECT.
3 (7) EVIDENCE OF A FIRM COMMITMENT FROM THE PROJECT USER
4 TO USE THE PROJECT UPON COMPLETION.
5 (8) IF THE PROJECT IS SOLELY FOR INFRASTRUCTURE, A
6 STATEMENT THAT A PORTION OF THE PROJECT IS BEING FUNDED UNDER
7 THE ACT OF JULY 11, 1990 (P.L. 465, NO. 113), KNOWN AS THE
8 TAX INCREMENT FINANCING ACT.
9 (9) ANY OTHER INFORMATION REQUIRED BY THE DEPARTMENT.
10 SECTION 3305. REVIEW.
11 (A) PROJECT REVIEW.--UPON RECEIVING A COMPLETED APPLICATION,
12 THE DEPARTMENT SHALL REVIEW THE APPLICATION TO DETERMINE ALL OF
13 THE FOLLOWING:
14 (1) THAT THE COST OF THE PROJECT IS REASONABLE.
15 (2) THE NUMBER OF NET NEW FULL-TIME JOBS CREATED OR TO
16 BE CREATED BY THE PROJECT AND THE NUMBER OF EXISTING FULL-
17 TIME JOBS TO BE PRESERVED BY THE PROJECT.
18 (3) THAT A FIRM COMMITMENT FROM THE PROJECT USER TO USE
19 THE PROJECT UPON COMPLETION EXISTS.
20 (4) THAT THE FINANCING FOR THE PROJECT IDENTIFIES A
21 PARTY OTHER THAN THE COMMONWEALTH THAT WILL BE RESPONSIBLE
22 FOR REPAYMENT OF THE DEBT.
23 (5) THAT THE APPLICANT SUBMITTED SATISFACTORY FINANCIAL
24 INFORMATION FROM THE PROJECT USER PREPARED OR REPORTED ON BY
25 AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT.
26 (6) THAT THE FINANCING FOR THE PROJECT DOES NOT PLEDGE
27 THE FULL FAITH AND CREDIT OF THE COMMONWEALTH.
28 (7) IF THE PROJECT IS SOLELY FOR INFRASTRUCTURE, THAT A
29 PORTION OF THE PROJECT IS BEING FUNDED UNDER THE TAX
30 INCREMENT FINANCING ACT.
20030S0010B1501 - 192 -
1 (8) IF THE PROJECT WAS COMPLETED PRIOR TO THE EFFECTIVE
2 DATE OF THIS SECTION, THAT THE PROJECT USER IS A RETAIL
3 ENTERPRISE.
4 (9) THAT THE APPLICANT AND THE PROJECT USER COMPLIED
5 WITH ALL OTHER CRITERIA ESTABLISHED BY THE DEPARTMENT.
6 (B) FINANCIAL REVIEW.--
7 (1) UPON BEING SATISFIED THAT ALL REQUIREMENTS HAVE BEEN
8 MET, THE DEPARTMENT SHALL FORWARD THE APPLICATION TO THE
9 OFFICE OF THE BUDGET AND THE DEPARTMENT OF REVENUE. THE
10 OFFICE, IN CONJUNCTION WITH THE DEPARTMENT OF REVENUE, SHALL
11 REVIEW THE APPLICATION. NOTWITHSTANDING THE PROVISIONS OF
12 SECTION 353(F) OF THE ACT OF MARCH 4, 1971 (P.L.6, NO.2),
13 KNOWN AS THE TAX REFORM CODE OF 1971, THE DEPARTMENT OF
14 REVENUE MAY SUPPLY THE DEPARTMENT AND THE OFFICE WITH
15 INFORMATION CONCERNING TAXES OWED OR PAID BY A PROJECT USER
16 OR FOR WHICH A PROJECT USER MAY OTHERWISE BE LIABLE OR WITH
17 ANY OTHER ASPECT OF AN APPLICANT'S TAX LIABILITY. THE OFFICE,
18 IN CONJUNCTION WITH THE DEPARTMENT OF REVENUE, SHALL EVALUATE
19 ALL OF THE FOLLOWING:
20 (I) THE SALES TAX COLLECTED OR EXPECTED TO BE
21 COLLECTED BY THE PROJECT USER PURSUANT TO ARTICLE II OF
22 THE TAX REFORM CODE OF 1971 FROM ACTIVITIES AS A RESULT
23 OF THE PROJECT.
24 (II) THE HOTEL OCCUPANCY TAX TO BE COLLECTED BY THE
25 PROJECT USER PURSUANT TO ARTICLE II OF THE TAX REFORM
26 CODE OF 1971 FROM ACTIVITIES AS A RESULT OF THE PROJECT.
27 (III) THE EXPECTED NET INCREASE IN PERSONAL INCOME
28 TAX WITHHELD BY THE PROJECT USER AS AN EMPLOYER PURSUANT
29 TO ARTICLE III OF THE TAX REFORM CODE OF 1971 FROM
30 ACTIVITIES AS A RESULT OF THE PROJECT.
20030S0010B1501 - 193 -
1 (2) THE OFFICE OF THE BUDGET MAY ACCEPT, REJECT OR
2 ADJUST THE ESTIMATE OF THE AMOUNT OF TAX REMITTED OR TO BE
3 REMITTED TO THE COMMONWEALTH BY THE PROJECT USER FROM
4 ACTIVITIES RESULTING FROM THE PROJECT.
5 § 3306. APPROVAL.
6 (A) FINANCIAL APPROVAL.--UPON BEING SATISFIED THAT ALL
7 REQUIREMENTS HAVE BEEN MET, THE SECRETARY OF THE BUDGET SHALL
8 ESTABLISH A MAXIMUM ANNUAL AMOUNT FOR THE GRANT AND SHALL NOTIFY
9 THE DEPARTMENT AND THE DEPARTMENT OF REVENUE. THE ANNUAL AMOUNT
10 ESTABLISHED SHALL BE BASED UPON THE REVIEW MADE IN SECTION
11 3305(B) (RELATING TO REVIEW) AND THE ANNUAL DEBT SERVICE OF THE
12 PROJECT.
13 (B) GRANT APPROVAL.--UPON RECEIPT OF THE NOTIFICATION
14 REQUIRED IN SUBSECTION (A), THE DEPARTMENT MAY APPROVE THE
15 APPLICATION AND AWARD THE APPLICANT A GRANT IN AN ANNUAL AMOUNT
16 NOT TO EXCEED THE AMOUNT ESTABLISHED BY THE SECRETARY OF THE
17 BUDGET. PRIOR TO PROVIDING GRANT FUNDS TO THE APPLICANT, THE
18 DEPARTMENT SHALL ENTER INTO A CONTRACT WITH THE APPLICANT AND
19 THE PROJECT USER. THE CONTRACT SHALL INCLUDE PROVISIONS WHICH DO
20 ALL OF THE FOLLOWING:
21 (1) SPECIFY THE AMOUNT OF THE GRANT PER YEAR FOR THE
22 FIRST THREE YEARS.
23 (2) SPECIFY THE TOTAL NUMBER OF YEARS THAT GRANT FUNDS
24 MAY BE PROVIDED TO THE APPLICANT. IF THE APPLICANT IS AN
25 INDUSTRIAL ENTERPRISE, RETAIL ENTERPRISE OR A MANUFACTURER,
26 THE NUMBER OF YEARS MAY NOT EXCEED TEN YEARS. IF THE
27 APPLICANT IS A HOSPITAL, CONVENTION CENTER OR HOTEL
28 ESTABLISHMENT, THE NUMBER OF YEARS MAY NOT EXCEED 20 YEARS.
29 (3) IF THE GRANT WILL BE AWARDED FOR MORE THAN THREE
30 YEARS, ESTABLISH THE PROCEDURE FOR THE AWARD OF A GRANT AFTER
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1 YEAR THREE. TO PROVIDE A GRANT BEYOND THE INITIAL THREE-YEAR
2 PERIOD, THE APPLICANT SHALL BE REQUIRED TO DEMONSTRATE TO THE
3 SATISFACTION OF THE DEPARTMENT, THE SECRETARY OF THE BUDGET
4 AND THE DEPARTMENT OF REVENUE ALL OF THE FOLLOWING:
5 (I) THAT THE TAX REVENUES SPECIFIED IN SECTION 3305
6 DURING THE FIRST OR SECOND YEAR GENERATED AN AMOUNT EQUAL
7 TO OR EXCEEDING THE AMOUNT OF THE GRANT AWARDED FOR THAT
8 YEAR.
9 (II) THAT THE TAX REVENUES SPECIFIED IN SECTION
10 3305(A) DURING THE THIRD YEAR ARE ANTICIPATED TO BE EQUAL
11 TO OR EXCEED THE AMOUNT OF THE GRANT TO BE AWARDED DURING
12 THE THIRD YEAR.
13 (III) THAT THE TAX REVENUES SPECIFIED IN SECTION
14 3305(A) DURING THE SUCCEEDING TWO-YEAR PERIOD ARE
15 ANTICIPATED TO BE EQUAL TO OR EXCEED THE AMOUNT OF THE
16 GRANT TO BE AWARDED DURING THAT SAME PERIOD. GRANTS MUST
17 BE VERIFIED PRIOR TO ANY SUBSEQUENT REQUEST BEING
18 GRANTED.
19 (IV) THAT THE AMOUNT OF THE ANNUAL GRANT REQUESTED
20 IN YEAR FOUR AND THEREAFTER WILL NOT EXCEED THE AMOUNT OF
21 THE ANNUAL DEBT SERVICE OWED ON THE PROJECT.
22 (4) REQUIRE THE APPLICANT TO USE THE GRANT TO PAY DEBT
23 SERVICE FOR THE PROJECT AND TO REPAY ALL OR ANY PORTION OF A
24 GRANT IF THE APPLICANT FAILS TO USE THE GRANT TO PAY DEBT
25 SERVICE.
26 (5) SPECIFY THAT THE ANNUAL AMOUNT OF THE GRANT IN ANY
27 ONE YEAR MAY NOT EXCEED THE ANNUAL AMOUNT OF THE DEBT SERVICE
28 ON THE PROJECT FOR THAT YEAR.
29 (6) IF THE GRANT IN ANY ONE YEAR EXCEEDS THE ANNUAL
30 PAYMENT ON DEBT SERVICE IN THAT YEAR, REQUIRE THE APPLICANT
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1 TO REPAY THE AMOUNT OF THE GRANT FOR THAT YEAR WHICH EXCEEDS
2 THE PAYMENT ON DEBT SERVICE FOR THAT YEAR.
3 (7) IF THE PROJECT USER IS NOT A GOVERNMENTAL ENTITY,
4 PROHIBIT THE PROJECT USER FROM HOLDING TITLE TO THE PROJECT
5 DURING THE PERIOD WHICH THE APPLICANT IS RECEIVING A GRANT
6 FROM THE DEPARTMENT.
7 (8) REQUIRE THE PROJECT USER TO PAY TO THE APPLICANT A
8 SUM EQUAL TO ANY PAYMENTS RECEIVED BY THE PROJECT USER FROM
9 THIRD PARTIES FOR INFRASTRUCTURE WHICH IS PART OF THE PROJECT
10 DURING THE PERIOD WHICH THE APPLICANT IS RECEIVING A GRANT
11 FROM THE DEPARTMENT. ANY PAYMENT RECEIVED BY THE APPLICANT
12 UNDER THIS PARAGRAPH MUST BE APPLIED TO PAYMENT OF THE DEBT
13 SERVICE FOR THE PROJECT.
14 (9) REQUIRE THE APPLICANT TO INSURE THAT THE FULL AMOUNT
15 OF ANNUAL DEBT SERVICE IS PAID FOR THE PROJECT, REGARDLESS OF
16 THE AMOUNT OF THE GRANT RECEIVED.
17 (10) REQUIRE THE PROJECT USER TO USE THE PROJECT FOR THE
18 PERIOD OF TIME THE APPLICANT IS RECEIVING GRANTS UNDER THIS
19 CHAPTER AND TO REPAY ALL OR ANY PORTION OF A GRANT IF THE
20 PROJECT USER FAILS TO USE THE PROJECT FOR THE PERIOD OF TIME
21 THE APPLICANT IS RECEIVING GRANTS.
22 (11) REQUIRE THE PROJECT USER TO TIMELY PAY ALL
23 COMMONWEALTH AND LOCAL TAXES AND FEES.
24 (12) REQUIRE THE DEPARTMENT TO APPROVE ANY CHANGE OF USE
25 OF A PROJECT DURING THE PERIOD IN WHICH THE APPLICANT IS
26 RECEIVING A GRANT FROM THE DEPARTMENT. THE DEPARTMENT MAY NOT
27 UNREASONABLY WITHHOLD ITS CONSENT TO A CHANGE OF USE.
28 (C) LIMITATIONS.--
29 (1) IF SUFFICIENT FUNDS ARE NOT APPROPRIATED TO COVER
30 THE ANTICIPATED COST OF THE GRANTS AWARDED IN ANY GIVEN
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1 FISCAL YEAR, THE DEPARTMENT SHALL PRORATE PAYMENTS TO ISSUING
2 AUTHORITIES.
3 (2) FOR GRANTS RENEWED IN ACCORDANCE WITH SUBSECTION
4 (B)(3), GRANTS MAY NOT EXCEED THE INCREMENTAL GROWTH IN
5 REVENUES REALIZED BY THE COMMONWEALTH FROM THE TAX SOURCES
6 IDENTIFIED IN SECTION 3305(B).
7 SECTION 2. ALL ACTS OR PARTS OF ACTS ARE REPEALED INSOFAR AS
8 THEY ARE INCONSISTENT WITH THIS ACT.
9 SECTION 3. THIS ACT SHALL TAKE EFFECT JULY 1, 2004, OR
10 IMMEDIATELY, WHICHEVER IS LATER.
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