PRINTER'S NO. 212
No. 217 Session of 1999
INTRODUCED BY GERLACH, MOWERY, MELLOW, WOZNIAK AND FUMO,
JANUARY 25, 1999
REFERRED TO FINANCE, JANUARY 25, 1999
AN ACT
1 Authorizing the State Tax Equalization Board to provide
2 financial assistance to counties for assessment reform;
3 creating a revolving loan fund from a restricted account
4 within the General Fund; providing for loans for assessment
5 improvement, including countywide reassessment; providing for
6 the powers and duties of the State Tax Equalization Board;
7 and making an appropriation.
8 TABLE OF CONTENTS
9 Chapter 1. Preliminary and Administrative Provisions
10 Section 101. Short title.
11 Section 102. Purpose and legislative intent.
12 Section 103. Definitions.
13 Section 104. Creation of advisory committee.
14 Section 105. Powers and duties of committee.
15 Section 106. Committee structure.
16 Section 107. Powers and duties of STEB.
17 Chapter 3. Revolving Loan Fund
18 Section 301. Assessment Reform Revolving Loan Fund.
19 Section 302. Prerequisite for loan.
20 Section 303. Contents of plan.
1 Section 304. Review of plan.
2 Section 305. Disbursement of loan funds.
3 Section 306. Restricted use of loan funds.
4 Section 307. Terms and conditions of loan repayment.
5 Chapter 5. Funding
6 Section 501. Appropriation.
7 Chapter 7. Miscellaneous Provisions
8 Section 701. Effective date.
9 The General Assembly of the Commonwealth of Pennsylvania
10 hereby enacts as follows:
11 CHAPTER 1
12 PRELIMINARY AND ADMINISTRATIVE PROVISIONS
13 Section 101. Short title.
14 This act shall be known and may be cited as the Assessment
15 Reform Loan Act.
16 Section 102. Purpose and legislative intent.
17 (a) Policy.--It is hereby declared to be a public policy of
18 this Commonwealth to improve the quality of the real estate
19 assessment process in each of the counties of this Commonwealth.
20 It is further a policy of this Commonwealth to assist counties
21 which desire to reassess valuations of real property by offering
22 a program of loans to accomplish this purpose.
23 (b) Legislative intent.--
24 (1) It is the intent of the General Assembly to provide
25 counties within this Commonwealth with the financial
26 resources necessary to assist them in improving their
27 respective real estate assessment processes, which
28 improvement may include, but may not be necessarily limited
29 to:
30 (i) Revaluation of real property located within a
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1 county.
2 (ii) Improvement of the maintenance and accuracy of
3 a county's assessment systems, procedures and standards
4 and the tax maps, property records and assessment rolls
5 related to them.
6 (iii) Improvement or establishment of a county's
7 appraisal practices, computer-assisted appraisal system
8 functional specifications, specifications for the conduct
9 of a revaluation program and procedures for the conduct
10 of public information programs.
11 (2) By this act, the General Assembly anticipates that
12 those counties eligible for funding under the provisions of
13 this act should be able to bring their established
14 predetermined ratios within the 15% tolerance of the board-
15 established common level ratio in the very near future and
16 maintain that tolerance over an extended period of time.
17 (3) The General Assembly has also concluded that
18 numerous counties within this Commonwealth have not
19 reassessed the value of taxable real estate for many years.
20 Consequently, while the market value of this property has
21 increased dramatically in recent years, counties have either
22 not kept pace with this higher valuation or have
23 unintentionally distributed the tax burden inequitably upon
24 their residents by not uniformly reassessing the entire
25 county.
26 Section 103. Definitions.
27 The following words and phrases when used in this act shall
28 have the meanings given to them in this section unless the
29 context clearly indicates otherwise:
30 "Advisory committee." The Assessment Reform Loan Advisory
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1 Committee created, empowered and defined under this act.
2 "Board." The State Tax Equalization Board, created under the
3 act of June 27, 1947 (P.L.1046, No.447), referred to as the
4 State Tax Equalization Board Law. Board may also be referred to
5 as "STEB."
6 "Coefficient of dispersion." A measure of the accuracy of
7 assessed values to true values, which measures the average
8 assessment error around the common level ratio as last
9 determined by the State Tax Equalization Board under the act of
10 June 27, 1947 (P.L.1046, No.447), referred to as the State Tax
11 Equalization Board Law.
12 "Common level ratio." The ratio of assessed value to current
13 market value used generally in the county as last determined by
14 the State Tax Equalization Board under the act of June 27, 1947
15 (P.L.1046, No.447), referred to as the State Tax Equalization
16 Board Law.
17 "County." A county within this Commonwealth, regardless of
18 classification, including a county adopting a home rule charter
19 or optional plan of government under the act of April 13, 1972
20 (P.L.184, No.62), known as the Home Rule Charter and Optional
21 Plans Law.
22 "Established predetermined ratio." The ratio of assessed
23 value to market value established by the board of county
24 commissioners or the legislative policymaking body in home rule
25 counties and uniformly applied in determining assessed value in
26 any year.
27 "Fund." Assessment Reform Revolving Loan Fund.
28 "STEB." The State Tax Equalization Board, created under the
29 act of June 27, 1947 (P.L.1046, No.447), referred to as the
30 State Tax Equalization Board Law. STEB may also be referred to
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1 as "board."
2 Section 104. Creation of advisory committee.
3 There is hereby created the Assessment Reform Loan Advisory
4 Committee which shall assist STEB in devising, preparing and
5 promulgating comprehensive standards of assessment reform to be
6 applied uniformly throughout the counties in this Commonwealth.
7 Section 105. Powers and duties of committee.
8 (a) Promulgate standards.--In conjunction with STEB, the
9 advisory committee shall devise, prepare and promulgate
10 comprehensive standards and procedures of assessment reform.
11 (b) Review applications.--In conjunction with STEB, the
12 advisory committee shall review applications for certification
13 by counties seeking to become recipients of loans in order to
14 ascertain whether the county plan is likely to result in an
15 acceptable level of assessment accuracy as defined in this act.
16 Section 106. Committee structure.
17 (a) Membership.--The advisory committee shall consist of
18 seven members, none of whom shall be an employee of the General
19 Assembly. They shall be appointed or designated as follows:
20 (1) The Governor shall appoint three members who are
21 broadly representative of the following groups:
22 (i) Licensed real estate brokers.
23 (ii) Instructors or researchers in various
24 disciplines related to mathematics or statistics who may
25 be employed by an accredited institution of higher
26 learning.
27 (iii) Citizens with general knowledge or interest in
28 real estate assessment practices.
29 (2) The President pro tempore of the Senate, the
30 Minority Leader of the Senate, the Speaker of the House of
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1 Representatives and the Minority Leader of the House of
2 Representatives shall each appoint one member with general
3 knowledge or interest in real estate assessment practices.
4 (b) Term.--The initial term of each member of the advisory
5 committee shall commence upon the date of his appointment and
6 shall expire 30 days after the convening of the next regular
7 session of the General Assembly. Thereafter, the term of each
8 member shall commence upon the date of his appointment and shall
9 expire two years later. All members shall serve until a
10 successor is appointed and qualified, and any member of the
11 advisory committee may serve successive terms. Any vacancy
12 occurring in the membership shall be filled by the appointing
13 power making the original appointment for the duration of the
14 unexpired term.
15 (c) Compensation.--An advisory committee member may not
16 receive a salary but shall be reimbursed for actual expenses
17 incurred in the performance of his official duties.
18 (d) Organization.--The advisory committee shall organize as
19 soon as possible after the appointment of members and shall
20 reorganize upon a change in membership. The advisory committee
21 shall select a chairman and other officers from among its
22 members.
23 (e) Deportment.--A member of the advisory committee, upon
24 clear and convincing evidence of misfeasance, malfeasance or
25 nonfeasance in office, including neglect of duty, may be removed
26 by majority vote of the members of the committee. A member
27 neglecting or refusing to attend two successive regular
28 meetings, unless prevented by sickness or other necessity, shall
29 be subject to removal by majority vote of the members of the
30 advisory committee.
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1 Section 107. Powers and duties of STEB.
2 (a) Maintain data.--STEB shall maintain accurate and current
3 data on the valuations of taxable and tax-exempt real property
4 and the number and status of all parcels of real property in
5 each county as provided to STEB by the respective assessment
6 offices of each county.
7 (b) Establish assessment procedures.--STEB, in conjunction
8 with the advisory committee, shall devise, prepare and
9 promulgate comprehensive assessment standards and procedures to
10 be applied uniformly throughout all counties in this
11 Commonwealth; this shall not include, however, the power of STEB
12 to set a standard or uniform established predetermined ratio of
13 assessed value to market value to be applied throughout all
14 counties of this Commonwealth.
15 (c) Review county systems.--STEB shall review plans
16 submitted by a county to improve that county's assessment
17 systems, procedures and standards which include countywide
18 reassessment programs.
19 (d) Evaluate county plans.--STEB shall either approve or
20 reject plans submitted by a county; however, in the event that
21 STEB rejects a plan submitted by a county, STEB shall provide
22 detailed documentation to enable the county to resubmit an
23 amended plan which is capable of approval by STEB.
24 (e) Review certification applications.--STEB, in conjunction
25 with the advisory committee, shall review applications for
26 certifications by a county to become a recipient of a loan to
27 assist the county in its ongoing process of assessment reform.
28 (f) Award loans.--STEB shall award loans to eligible
29 counties in accordance with the provisions of this act.
30 (g) Make regulations.--STEB shall promulgate rules and
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1 regulations necessary to implement the provisions of this act.
2 CHAPTER 3
3 REVOLVING LOAN FUND
4 Section 301. Assessment Reform Revolving Loan Fund.
5 (a) Creation.--There is hereby created a restricted revenue
6 account within the General Fund in the Treasury Department, to
7 be known as the Assessment Reform Revolving Loan Fund. Into this
8 account shall be credited all appropriations made by the General
9 Assembly, including the continuing appropriation under section
10 501, and the repayment of principal on loans made under this
11 act.
12 (b) Function.--Upon approval of a loan, STEB shall routinely
13 requisition from the fund the amounts allocated by STEB for
14 loans to eligible counties. When and as the amounts so allocated
15 by STEB as loans to counties are repaid to STEB under the terms
16 of the covenants made and entered into with STEB under this act,
17 STEB shall pay the amounts into the fund, it being the intent of
18 this act that the fund shall operate as a revolving fund from
19 which the appropriations and payments made to the fund may be
20 applied and reapplied to the purposes of this act.
21 Section 302. Prerequisite for loan.
22 A county which seeks a loan from the Assessment Reform
23 Revolving Loan Fund shall be required to first submit a detailed
24 plan for assessment reform to STEB.
25 Section 303. Contents of plan.
26 The plan submitted by a county to STEB shall be consistent
27 with applicable law and STEB requirements and shall include the
28 following specifications:
29 (1) A detailed statement of the current permanent
30 records system of a county's assessment office, including tax
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1 maps, property record cards, property owner's index,
2 computerized systems and related matters.
3 (2) A comprehensive explanation of the method by which a
4 county intends to implement assessment reform.
5 (3) In the event that a county seeks financial
6 assistance to conduct a countywide reassessment of the
7 valuations of the real property located within the county,
8 the county shall include within the plan a comprehensive
9 proposed methodology by which the county intends to perform
10 the reassessment.
11 (4) A plan submitted to STEB shall include a detailed
12 statement of the precise costs associated with proposed
13 assessment reform which includes countywide reassessment.
14 Section 304. Review of plan.
15 (a) Preliminary review.--STEB shall review a plan or amended
16 plan submitted by a county to insure compliance with applicable
17 provisions of this act and shall issue a preliminary approval or
18 rejection of the plan within 60 days from the date the plan is
19 received by STEB.
20 (b) Disbursement of funds.--If satisfied that the
21 requirements of this act have been met, STEB shall issue final
22 approval of a plan, including disbursement of approved loan
23 funds, within 60 days of the date of preliminary approval.
24 (c) Rejection statement.--In the event of a preliminary
25 rejection of the plan, STEB shall provide detailed documentation
26 to enable the county to resubmit an amended plan. The
27 resubmission of an amended plan by a county shall occur within
28 60 days of the date a county receives a preliminary rejection of
29 the original or of any amended plan in order for the county to
30 remain eligible for disbursement of loan funds.
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1 (d) Resubmission of amended plans.--Resubmission of an
2 amended plan may be made as many times as may be required by
3 STEB in order for a county to be eligible for disbursement of
4 loan funds.
5 Section 305. Disbursement of loan funds.
6 In calculating a precise amount of loan funds to be disbursed
7 to a county which submits an approved plan, STEB shall first
8 certify the number of parcels of real estate located within the
9 county. Then STEB shall calculate the amount of the loan by
10 certification of a sum of money up to $40 per parcel which, when
11 applied to the number of parcels of real estate within the
12 county, shall constitute the final total amount of loan funds to
13 be disbursed to the county.
14 Section 306. Restricted use of loan funds.
15 (a) General rule.--Loan funds disbursed following submission
16 of an approved plan under the provisions of this act shall be
17 used only to implement the assessment reform set forth in the
18 plan submitted by the county.
19 (b) Restrictions.--None of the proceeds of the loan shall be
20 used to retire "debt" or "unfunded debt" as defined in the act
21 of July 12, 1972 (P.L.781, No.185), known as the Local
22 Government Unit Debt Act, and shall not be subject to the
23 provisions of that act.
24 Section 307. Terms and conditions of loan repayment.
25 A county to which loan funds are disbursed following
26 submission of an approved plan to STEB shall comply with the
27 following terms and conditions with respect to repayment and
28 shall enter into a covenant with respect to these terms:
29 (1) Loans shall be repayable by a county without
30 interest charged on the principal sum of the loan.
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1 (2) Loans shall be repayable by a county in five equal
2 annual installments, the first of which shall become due and
3 payable within 90 days of one of the following dates,
4 whichever occurs first:
5 (i) The date of complete implementation of the
6 approved plan as certified by STEB.
7 (ii) Three years following the date of disbursement
8 of loan funds.
9 (3) The second annual installment payment on any loan
10 shall become due and payable 12 months after the date of
11 payment of the first installment, and subsequent annual
12 installment payments shall be due and payable at 12-month
13 intervals.
14 CHAPTER 5
15 FUNDING
16 Section 501. Appropriation.
17 After deduction of actual expenses by the Department of
18 Revenue, all interest earned on personal income taxes and sales
19 taxes collected by the department on behalf of counties,
20 municipalities and school districts pursuant to the act of
21 December 31, 1965 (P.L.1257, No.511), known as The Local Tax
22 Enabling Act, is appropriated on a continuing basis to the
23 Assessment Reform Revolving Loan Fund.
24 CHAPTER 7
25 MISCELLANEOUS PROVISIONS
26 Section 701. Effective date.
27 This act shall take effect January 1, 1999.
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