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Senate Co-Sponsorship Memoranda
Senate of Pennsylvania
Session of 2015 - 2016
Regular Session
MEMORANDUM
| Posted: | June 5, 2015 03:30 PM |
|---|---|
| From: | Senator Lloyd K. Smucker |
| To: | All Senate members |
| Subject: | Keystone Opportunity Zone Extension |
| From: Senator Lloyd K. Smucker To: All Senators Subject: Keystone Opportunity Zone Extension In the near future, I plan to introduce KOZ extension legislation that would incentivize significant job creation across the Commonwealth. This language provides for DCED approval of the continuation of one or more parcels within existing zones or subzones beyond their respective termination dates in order to promote additional job creation or additional capital investment. This continuation would apply only to state tax payments. The language of the amendment mirrors an existing section of the KOZ Act (73 P.S. § 820.301.7) that authorized zone and subzone expansion for job creation purposes. The current KOZ Act was enacted in 1998 as Act 92. The Act can be found at 73 P.S. § 820.301 et seq. There are some businesses currently located within KOZs that have high levels of employment and that have made significant capital investments at their locations. Continuation of the life of a KOZ parcel for these businesses serves to encourage the expanded operation of these businesses at the site and throughout the Commonwealth, to maintain the momentum of economic development, and to bring the full tax benefit to the local political subdivision by limiting the continuation to state taxes only. In fact, continuation of these parcels will effectively propel further economic development both inside and outside of the zones and within the Commonwealth as a whole. This legislation allows certain qualifying businesses to apply to DCED for the continuation of one or more parcels within a KOZ for a period of up to 10 years after the expiration date of the existing zone. Once approved, the qualifying businesses would receive only state tax exemptions, deductions, abatements or credits. A qualified business singly, or a group of qualified businesses jointly, may apply to DCED for a continuation of one or more parcels within a zone or subzone. Application must be made to DCED at least three months prior to the expiration date of the existing zone. The qualified business, as a single applicant, or the qualified businesses applying jointly, taken as a whole, must: 1) Have a minimum of 2500 employees located in the Commonwealth, 2) Show a prior minimum capital investment in the Commonwealth of at least $300 million, 3) Be conducting active business operations from the parcel or parcels that are the subject of the application, and 4) Otherwise be in compliance with the KOZ Act. DCED will publish guidelines establishing the requirements for an application. If approved, the continuation will expire after 10 years or upon the removal of all qualified businesses from the continued parcel. After continuation is approved, the qualified business or businesses will receive an annual renewal of certification for tax exemptions, etc. for the first year of the continuation period. For each year thereafter, the qualified business or businesses must show increased job creation within the Commonwealth of at least 100 jobs or increased capital investment within the Commonwealth of at least $10 million over the previous year in order to qualify for subsequent annual renewals. If, in any one year, the qualified business or businesses show increased job creation of at least 300 jobs within the Commonwealth or increased capital investment of at least $50 million within the Commonwealth over the previous year, then the business or businesses do not need to show additional job creation or capital investment for the remainder of the continuation term. Those businesses must still comply with the other provisions of the KOZ Act. |
Introduced as SB884