PRINTER'S NO. 3292
No. 2509 Session of 1980
INTRODUCED BY NAHILL, SWEET, CORNELL, SEVENTY, McVERRY,
J. L. WRIGHT, JR., VROON, POTT, SCHMITT, RICHARDSON, WACHOB,
KUKOVICH, E. H. SMITH, FEE, COCHRAN, TRELLO, AUSTIN, BURNS,
MRKONIC, WASS, PETRARCA, PYLES, DeWEESE, BOWSER, DAWIDA,
TADDONIO, SCHEAFFER, SHADDING, DUMAS, HALVERSON, PITTS,
STAIRS, KNEPPER, LEHR, LEVI, DIETZ, STEIGHNER, KOLTER, ZORD,
DeMEDIO, TELEK, W. W. FOSTER, NOVAK, F. TAYLOR,
B. F. O'BRIEN, YAHNER, COLE, FISCHER, A. K. HUTCHINSON,
DUFFY, KNIGHT, STEWART, LEWIS, CAPPABIANCA, B. D. CLARK AND
GLADECK, MAY 2, 1980
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, MAY 2, 1980
AN ACT
1 Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2 act relating to tax reform and State taxation by codifying
3 and enumerating certain subjects of taxation and imposing
4 taxes thereon; providing procedures for the payment,
5 collection, administration and enforcement thereof; providing
6 for tax credits in certain cases; conferring powers and
7 imposing duties upon the Department of Revenue, certain
8 employers, fiduciaries, individuals, persons, corporations
9 and other entities; prescribing crimes, offenses and
10 penalties," altering the rate of tax upon utility realty
11 readied for use after December 31, 1980 and changing the
12 formula for distribution of the realty tax equivalent to
13 local taxing authorities.
14 The General Assembly of the Commonwealth of Pennsylvania
15 hereby enacts as follows:
16 Section 1. Clauses (3) and (6) of section 1101-A, act of
17 March 4, 1971 (P.L.6, No.2), known as the "Tax Reform Code of
18 1971," added July 4, 1979 (No.27), are amended to read:
19 Section 1101-A. Definitions.--The following words, terms and
1 phrases when used in this article shall have the meaning
2 ascribed to them in this section, except where the context
3 clearly indicates a different meaning:
4 * * *
5 (3) "Utility realty." All lands, together with all
6 buildings, towers, smokestacks, dams, dikes, canals, cooling
7 towers, storage tanks, reactor structures, pump houses,
8 supporting foundations, enclosing structures, supporting
9 structures, containment structures, reactor containment outer
10 shells, reactor containment vessels, turbine buildings, recovery
11 tanks, solid waste area enclosures, primary auxiliary buildings,
12 containment auxiliary safeguard structures, fuel buildings,
13 decontamination buildings, and, all other structures and
14 enclosures whatsoever which are physically affixed to the land,
15 no matter how such structures and enclosures are designated and
16 without regard to the classification thereof for local real
17 estate taxation purposes, but not including machinery and
18 equipment, whether or not housed within such building, structure
19 or enclosure, located within this Commonwealth and owned by a
20 public utility either directly or by or through a subsidiary,
21 which are used or are in the course of development or
22 construction for use, in the furnishing, including producing,
23 storing, distributing or transporting, of public utility service
24 and which are not subject to local real estate taxation under
25 any law in effect on April 23, 1968. Utility realty so used
26 prior to December 31, 1980 shall be known as "pre-December 31,
27 1980 utility realty." Utility realty placed into such use on or
28 after December 31, 1980 shall be known as "post-December 31,
29 1980 utility realty": Provided, however, That the following
30 specified items shall be exempt from the tax hereby imposed:
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1 (i) Easements or similar interests.
2 (ii) Railroad rights-of-way and superstructures thereon.
3 (iii) Pole, transmission tower, pipe, rail or other lines
4 whether or not said lines are attached to the land or to any
5 structure or enclosure which is physically affixed to the land.
6 * * *
7 (6) "Realty tax equivalent." The total amount of taxes
8 which a local taxing authority could have imposed on utility
9 realty but for this article, and unless otherwise provided shall
10 be the product of the real estate property tax rate and the
11 assessed valuation of utility realty. The realty tax equivalent
12 with respect to pre-December 31, 1980 utility realty shall be
13 known as "realty tax equivalent on pre-December 31, 1980 utility
14 realty." The realty tax equivalent with respect to post-December
15 31, 1980 utility realty shall be known as "realty tax equivalent
16 on post-December 31, 1980 utility realty."
17 * * *
18 Section 2. Subsections (a) and (b) of section 1102-A,
19 subsection (b) of section 1104-A and sections 1106-A and 1107-A,
20 added July 4, 1979 (No.27), are amended to read:
21 Section 1102-A. Imposition of Tax; Report; Interest and
22 Penalties.--(a) On or before the first day of June of [1970]
23 1981 and of each year thereafter, every public utility shall pay
24 to the State Treasurer, through the Department of Revenue, a tax
25 at the rate of thirty mills upon each dollar of the State
26 taxable value of its [utility realty at the end of the preceding
27 calendar year.] pre-December 31, 1980 utility realty at the end
28 of the preceding calendar year, and a tax equal to the realty
29 tax equivalent on its post-December 31, 1980 utility realty, as
30 determined by each local taxing authority as of the date and in
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1 the manner prescribed by section 1106-A, and a tax at the rate
2 of one per cent of the total of the above or such other amount
3 as is determined on or before the first day of April of 1981 and
4 each year thereafter by the State Treasurer to defray the cost
5 of the Commonwealth in collecting and administering the
6 provisions of this act.
7 (b) Each such payment shall be accompanied by a report, upon
8 oath of the owner or responsible officer of the public utility,
9 showing the amount and manner of computation of the State
10 taxable value upon which such payment is based, and containing a
11 copy of the report submitted to it pursuant to section 1106-A(b)
12 showing the amount of the realty tax equivalent on its post-
13 December 31, 1980 utility realty.
14 * * *
15 Section 1104-A. Effect of Payment; Additional Assessment.--
16 * * *
17 (b) If in any calendar year [the amount determined by the
18 department pursuant to section 1107-A(a)(2)] the amount of the
19 total realty tax equivalent determined by the department
20 pursuant to section 1107-A(a)(2) shall exceed the total amount
21 of tax collected pursuant to section 1102-A(a), the department
22 shall determine the ratio which the amount of such excess bears
23 to the total State taxable value of all pre-December 31, 1980
24 utility realty reported to it pursuant to section 1102-A(b). The
25 department shall notify each reporting public utility of such
26 ratio, and it shall be the duty of such public utility, within
27 forty-five days thereafter, to pay to the State Treasurer,
28 through the Department of Revenue, an additional amount of tax
29 equal to the product of (1) such ratio and (2) the State taxable
30 value shown in its report required by section 1102-A(b). The
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1 provisions of section 1102-A(c) shall be applicable to such
2 additional amount of tax.
3 Section 1106-A. Reports by Local Taxing Authorities.--(a)
4 On or before the first day of April of [1971] 1981 and of each
5 year thereafter, each local taxing authority shall submit to the
6 department:
7 (1) The name and address of each public utility owning
8 utility realty within its jurisdiction, and the assessed value
9 of such utility realty pre-December 31, 1980 utility realty, and
10 the post-December 31, 1980 utility realty.
11 (2) Its real estate tax rate for its current fiscal year.
12 (3) [The realty tax equivalent, which is the assessed value
13 of clause (1) multiplied by the tax rate of clause (2).] The
14 realty tax equivalent, realty tax equivalent on pre-December 31,
15 1980 utility realty, and realty tax equivalent on post-December
16 31, 1980 utility realty, which are the respective assessed
17 values in clause (1) multiplied by the tax rate of clause (2).
18 (4) Its total tax receipts for its last completed fiscal
19 year.
20 (5) Any adjustment to the assessed values, tax rates, realty
21 tax equivalents, realty tax equivalents on pre-December 31, 1980
22 utility realty, realty tax equivalents on post-December 31, 1980
23 utility realty or total tax receipts previously reported
24 pursuant to clauses (1) to (4).
25 (b) [If a local taxing authority shall fail to file the
26 report required by subsection (a) by the date therein
27 prescribed, or within any extension granted by the department,
28 it shall forfeit its right to share in the next-ensuing
29 distribution made pursuant to section 1107-A.] On or before the
30 last day of April of 1981 and of each year thereafter, each
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1 local taxing authority shall submit to each public utility
2 having post-December 31, 1980 utility realty within its
3 jurisdiction a report showing the realty tax equivalent on such
4 public utility's post-December 31, 1980 utility realty. Such
5 amount shall be in the same amount as is reported to the
6 department in the report required to be filed pursuant to
7 subsection (a).
8 (c) If a local taxing authority fails to file the reports
9 required by subsections (a) and (b) by the dates therein
10 prescribed, or within any extension granted by the department,
11 it shall forfeit its right to share in the next-ensuing
12 distribution made pursuant to section 1107-A.
13 Section 1107-A. Distribution to Local Taxing Authorities.--
14 (a) From the reports received by it in each year pursuant to
15 section 1106-A, the department shall determine:
16 (1) The total tax receipts shown in all such reports.
17 (2) [The total realty tax equivalent shown in all such
18 reports.] The total realty tax equivalent, realty tax equivalent
19 on pre-December 31, 1980 utility realty, and realty tax
20 equivalent on post-December 31, 1980 utility realty shown in all
21 such reports.
22 (b) On or before the first day of October of 1971 and of
23 each year thereafter, the department shall distribute to each
24 reporting local taxing authority its share of the total realty
25 tax equivalent determined pursuant to subsection (a)(2), which
26 share shall [be the ratio which the total tax receipts reported
27 by that local taxing authority bear to the total tax receipts
28 determined pursuant to subsection (a)(1).] equal the sum of its
29 realty tax equivalent on post-December 31, 1980 utility realty,
30 plus an amount equal to the ratio which the total tax receipts
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1 reported by that local taxing authority bear to the total tax
2 receipts determined pursuant to subsection (a)(1) multiplied by
3 the total realty tax equivalent on pre-December 31, 1980 utility
4 realty determined pursuant to subsection (a)(2).
5 (c) For the purpose of making such payment, the department
6 shall make requisition therefor in the manner prescribed by "The
7 Fiscal Code."
8 Section 3. This act shall take effect January 31, 1981.
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