Regular Session 2015-2016 Senate Bill 0385 P.N. 1619

HOUSE AMENDED

PRIOR PRINTER'S NOS. 298, 500, 738,

1363

PRINTER'S NO. 1619

THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

No.

385

Session of

2015

INTRODUCED BY PILEGGI, RAFFERTY, BREWSTER, COSTA, GREENLEAF,

SCHWANK, SMITH, VULAKOVICH, WARD, YUDICHAK AND BROWNE,

FEBRUARY 3, 2015

AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES,

MARCH 16, 2016

AN ACT

Amending the act of December 8, 2004 (P.L.1801, No.238),

entitled "An act empowering municipalities, counties and

public transportation agencies to work cooperatively to

establish Transit Revitalization Investment Districts (TRID),

including partnerships with the National Railroad Passenger

Corporation requiring planning studies, comprehensive plan

and zoning amendments and use of existing statutes and

techniques to achieve transit-oriented development,

redevelopment, community revitalization and enhanced

community character through TRID creation; establishing value

capture areas as a means to reserve and use future,

designated incremental tax revenues for public transportation

capital improvements, related site development improvements

and maintenance; promoting the involvement of and

partnerships with the private sector in TRID development and

implementation; encouraging public involvement during TRID

planning and implementation; and providing for duties of the

Department of Community and Economic Development," in general

provisions, further providing for definitions; in TRID

creation and location, further providing for criteria for

proposed TRID, for TRID designation, for implementing

authority, for TRID planning study factors, for roles and

responsibilities of public transportation agencies and

municipalities and for amendments to TRID planning study; in

land development powers of public transportation agencies,

further providing for development or redevelopment of

property AND PROVIDING FOR ADDITIONAL POWERS OF MANAGEMENT

ENTITIES AND FOR PROHIBITION ON MANAGEMENT ENTITIES; in value

capture approaches, further providing for creation of value

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capture area and for dedication of tax revenues; providing

for capture of TRID tax revenue GRANT OF TRID REVENUE AND

ESTABLISHING THE TRID FUND; and, in community involvement,

further providing for public meeting to explain TRID and

alternative implementation approaches.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Section 103 of the act of December 8, 2004

(P.L.1801, No.238), known as the Transit Revitalization

Investment District Act, is amended by adding a definition

DEFINITIONS to read:

Section 103. Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

* * *

"BOND." THE TERM INCLUDES BOND, NOTE, INSTRUMENT, REFUNDING

BOND, REFUNDING NOTE OR OTHER EVIDENCE OF INDEBTEDNESS OR

OBLIGATION.

* * *

"ELIGIBLE PROJECT." DEVELOPMENT OR IMPROVEMENT WITHIN A

TRID, INCLUDING CONSTRUCTION, INFRASTRUCTURE AND SITE

PREPARATION, RECONSTRUCTION OR RENOVATION OF A FACILITY WITHIN A

TRID WHICH WILL RESULT IN ECONOMIC DEVELOPMENT OR TRANSIT-

ORIENTED DEVELOPMENT IN ACCORDANCE WITH THE TRID AND THE TRID

PLANNING STUDY.

"Management entity." Any of the following:

(1) A participating municipality or transit , COUNTY OR

PUBLIC TRANSPORTATION agency.

(2) A redevelopment authority, municipal authority,

neighborhood improvement district MANAGEMENT ASSOCIATION ,

business improvement district or a similar governmental or

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nonprofit organization authorized to act in a manner

consistent with the TRID planning study and with a services

area compatible with the TRID.

* * *

"PROJECT COSTS." ANY EXPENDITURES MADE OR ESTIMATED TO BE

MADE, OR MONETARY OBLIGATIONS INCURRED OR ESTIMATED TO BE

INCURRED, WHICH ARE LISTED IN A TRID PLAN OR AGREEMENT AS COSTS

OF IMPROVEMENTS THAT CREATE ECONOMIC DEVELOPMENT OR

REVITALIZATION WITHIN A TRID DISTRICT, PLUS ANY COSTS INCIDENTAL

THERETO. PROJECT COSTS INCLUDE, BUT ARE NOT LIMITED TO, THE

CAPITAL, FINANCING, REAL PROPERTY ASSEMBLY, PROFESSIONAL

SERVICE, ADMINISTRATIVE, RELOCATION, ORGANIZATIONAL AND OTHER

NECESSARY OR CONVENIENT COSTS DELINEATED IN THE ACT OF JULY 11,

1990 (P.L.465, NO.113), KNOWN AS THE TAX INCREMENT FINANCING

ACT .

* * *

"REDEVELOPMENT AUTHORITY." AN AUTHORITY CREATED PURSUANT TO

THE ACT OF MAY 24, 1945 (P.L.991, NO.385), KNOWN AS THE URBAN

REDEVELOPMENT LAW.

* * *

Section 2. Sections 301, 302, 303, 304, 305, 306, 502, 701

and 702 AND 502 of the act are amended to read:

Section 301. Criteria for proposed TRID.

Local municipalities, counties, transportation authorities

and public transportation agencies proposing to define and

develop a TRID shall use the following criteria and process:

(1) Eligible TRID locations may include any geographic

area of a municipality or municipalities, including vacant,

underutilized or potentially redevelopable land, within an

area [generally formed by a minimum radius of one-eighth mile

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and] not to exceed a radius of [one-half] THREE-QUARTERS mile

from a railroad, transit, light rail, busway or similar

transit stop or station, measured from the centerline of the

track or roadway traversing the station or stop location.

TRID designation may also include new station locations

proposed in conjunction with a planned public transportation

service, as defined on an adopted county, regional or public

transportation agency plan.

[(2) The specific boundaries of a TRID may be expanded

or reduced based on local circumstances such as local

economic development and planning goals, community character,

property boundary and scale variations but only when:

(i) authorized by the governing body or bodies of

the affected jurisdiction or jurisdictions in cooperation

with the pertinent public transportation agency; and

(ii) the rationale for the boundaries is supported

by the findings of the required TRID planning study.]

(3) A local municipality or municipalities shall

[further] define and support the rationale for the TRID

designation through a TRID planning study as well as

appropriate amendments to the municipal comprehensive plan,

zoning ordinance and other pertinent regulations.

(4) A local municipality may designate the county

planning agency to undertake or assist the TRID planning

study on its behalf.

(5) An existing neighborhood improvement district, tax

increment district or urban renewal area may be used as the

basis for the boundaries of a TRID when justified by the TRID

planning study required in section 304.

Section 302. TRID designation.

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(a) Designation.--Local municipalities and counties working

with public transportation agencies, transportation authorities,

AMTRAK, passenger rail transportation providers or any

combination thereof may designate TRIDs in advance of

implementation of a new public transit service or in conjunction

with an existing public transportation service and in advance of

or in conjunction with actual development proposals. A TRID and

its boundaries shall be established by ordinance. IN A CITY OF

THE THIRD CLASS SITUATE WITHIN A COUNTY OF THE SECOND CLASS A,

THE DESIGNATION AND BOUNDARIES OF THE TRID SHALL BE MADE

EXCLUSIVELY BY THE GOVERNING BODY OF THE COUNTY.

(b) Agreement.--To create a TRID, in addition to the

planning study described in section 301(3), the municipality or

municipalities shall enter into an agreement with the transit

agency that approves the TRID planning study under section

301(3) and defines the activities [and], commitments and

administrative and management roles of each party to the TRID,

including any specific actions or financial participation to

help implement the TRID. The agreement shall include the

development agreement specified in section 504 as well as a

description of the TRID management entity described in section

[502(4)] 303.

Section 303. [Implementing authority] Management entity.

[A [participating county, local municipality, transportation

authority and public transportation agency may designate on

their behalf the county redevelopment authority to assume

responsibility for TRID implementation.] The participating local

municipality or county and the transit , WHICH MADE THE

DESIGNATION UNDER SECTION 302, AND THE PUBLIC TRANSPORTATION

agency shall designate the management entity in the TRID

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agreement to administer, manage and facilitate the

implementation of the TRID planning study.

Section 304. TRID planning study factors.

The scope and scale of transit improvements and community

facility improvements, as well as any needed support facilities,

shall be assessed in the TRID planning study. The TRID planning

study shall also serve as the basis for a comprehensive plan

amendment to establish the TRID if the municipality has a

currently adopted comprehensive plan. The following shall apply:

(1) The planning study shall consider the need for

capital improvements to transit-related facilities and

adjacent public infrastructure, including roads, sidewalks

and water, sewer and storm drainage service and public

facilities, as well as opportunities for private sector real

estate development and ways in which such facilities,

services and development can be financed.

(2) Municipalities and counties undertaking a TRID

planning study shall receive priority consideration for

planning [and implementation] grants and technical assistance

from the department[, working in partnership with the

pertinent county planning agency or agencies and other State

agencies with grant or loan programs that may be applicable

to TRID planning or implementations]. Any funding

[appropriated to the Department of Community and Economic

Development for the purpose of carrying out this act is

intended to assist counties and local governments on a 25%

matching basis to undertake TRID planning studies and related

implementation activities. Individual grants for a TRID

planning study or implementation project shall not exceed

$75,000. The department in consultation with the Department

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of Transportation shall administer the supplemental TRID

program through the existing land use planning and technical

assistance program, with application guidance as necessary.]

utilized PROVIDED by the department to assist with TRID

planning studies, except where otherwise limited by law,

shall require a match of 25% .

(3) Commonwealth agencies are directed to provide State

resources, programs and new capital investments that will

assist local governments, transportation authorities and

[transit] PUBLIC TRANSPORTATION agencies to implement TRIDS.

Section 305. Roles and responsibilities of public

transportation agencies and municipalities.

As guidelines to implement the findings and recommendation of

the TRID planning study, the following roles and

responsibilities are defined:

(1) [The] IDENTIFYING THE scope and scale of needed or

proposed transit capital improvements within the TRID area

are the responsibility of the partnering public

transportation agency. The cost, financing, phasing and

schedule of all transit-related improvements shall be

included in the public transportation agency's adopted

capital program.

(2) [The] IDENTIFYING THE scope and scale of needed or

proposed support facilities, highway accessways and community

or neighborhood facility improvements, for example, sidewalks

and recreation facilities, are the responsibility of the

partnering county and local jurisdiction or jurisdictions and

may include support from the private sector.

[(3) [Notwithstanding these stated roles and

responsibilities, the parties to a TRID shall be responsible

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for defining the administrative and management roles and

responsibilities that will be most appropriate to achieve

implementation of the TRID in their community.]

ADMINISTRATION, MANAGEMENT AND FACILITATION OF THE TRID

IMPLEMENTATION ARE PRIMARILY THE RESPONSIBILITY OF THE

MANAGEMENT ENTITY, INCLUDING, BUT WITHOUT LIMITATION, ISSUING

BONDS AND NOTES , SECURING GRANT FUNDS AND OTHERWISE RAISING,

EXPENDING AND ADMINISTERING FUNDS FOR TRID PROJECTS.

Section 306. Amendments [to TRID planning study].

[Proposed real estate development or redevelopment may

trigger additional needs for transit improvements and community

facility improvements or support facilities and shall be

accommodated through pertinent amendments of the TRID planning

study and county, multimunicipal or local municipal

comprehensive plan.] If warranted by a changing economic or

community condition, planning goal, real estate development,

redevelopment opportunity or a demonstrated need for transit or

community facility improvement, a TRID or TRID planning study

may be amended. The following shall apply:

(1) The boundaries of a TRID may be expanded or reduced

by an amendment to the ordinance establishing the TRID and

shall be accompanied by justification for the boundary change

supported by findings in the original or amended TRID

planning study.

(2) A TRID planning study may be amended by approval of

the municipality , municipalities or counties and the transit

agency that are parties to the TRID designation under section

302.

Section 502. Development or redevelopment of property.

Development or redevelopment of property within a TRID shall

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generally occur in the following manner:

(1) The public transportation agency, MUNICIPALITY OR

MANAGEMENT ENTITY may acquire the property, improve it for

future development, such as site clearance, utility work,

environmental remediation and similar improvements, and work

cooperatively with the pertinent local jurisdiction or

jurisdictions and implementing agencies to offer it for sale

to the private sector for use or uses consistent with the

adopted TRID plan.

(2) Alternatively, the public transportation agency,

MUNICIPALITY OR MANAGEMENT ENTITY may advertise the presence

of available development sites within a TRID, including a map

of potentially developable or redevelopable properties, and

invite interested developers to submit proposals in

cooperation with the pertinent local jurisdiction or

jurisdictions and implementing agencies.

(3) In the case of either paragraph (1) or (2), the

public transportation agency may not be the primary real

estate developer, and joint development activities are

confined to the construction of support and access

facilities: that is, vehicular access, parking, pedestrian

ways, building pads, foundation columns, signage and similar

items.

[(4) [The partnering TRID local municipality or

municipalities shall designate a management entity for the

TRID which may be a municipal authority or joint municipal

authority, in accordance with the requirements of 53 Pa.C.S.

Ch. 56 (relating to municipal authorities) to manage and

facilitate TRID implementation. The local municipality or

municipalities involved in the TRID shall retain policy and

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oversight responsibilities for all budgetary and programmatic

actions of the designated TRID management entity.] SIMILAR

TO, BUT NOT LIMITED BY, THE ACT OF JULY 11, 1990 (P.L.465,

NO.113), KNOWN AS THE TAX INCREMENT FINANCING ACT, A PUBLIC

TRANSPORTATION AGENCY, MUNICIPALITY, MANAGEMENT ENTITY OR A

DESIGNATED AGENT MAY ISSUE BONDS OR NOTES , DEPOSIT MONEY INTO

THE TRID FUND OF ANY TRID DISTRICT ACCOUNT , ENTER INTO ANY

CONTRACTS OR AGREEMENTS, INCLUDING AGREEMENTS WITH

BONDHOLDERS, AS DETERMINED TO BE NECESSARY OR CONVENIENT TO

IMPLEMENT THE PROVISIONS AND EFFECTUATE THE PURPOSES OF TRID

PROJECT PLANS. THE CONTRACTS OR AGREEMENTS MAY INCLUDE

CONDITIONS, RESTRICTIONS OR COVENANTS WHICH EITHER RUN WITH

THE LAND OR OTHERWISE REGULATE THE USE OF THE LAND.

(5) Creative partnerships with AMTRAK, passenger rail

transportation providers, transportation authorities and the

private sector to accomplish TRID purposes that use the

benefits of AMTRAK's and passenger rail service providers'

existing real estate development powers are both desirable

and encouraged.

[(6) Neighborhood improvement districts, business

improvement districts or similar entities may be designated

to manage the TRID implementation activities.]

SECTION 3. THE ACT IS AMENDED BY ADDING SECTIONS TO READ:

SECTION 505. ADDITIONAL POWERS OF MANAGEMENT ENTITIES.

IN ADDITION TO OTHER POWERS AND FUNCTIONS OF MANAGEMENT

ENTITIES GRANTED UNDER THIS ACT, A MANAGEMENT ENTITY SHALL HAVE

THE POWER TO PROVIDE OR BORROW MONEY FOR PURPOSES OF EXECUTING A

TRID, A TRID PLANNING STUDY OR FOR AN ELIGIBLE PROJECT. A

MANAGEMENT ENTITY MAY ALSO ISSUE BONDS, IF PERMITTED TO DO SO

UNDER COMMONWEALTH STATUTE, FOR THE PURPOSES OF EXECUTING A

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TRID, A TRID PLANNING STUDY OR FOR AN ELIGIBLE PROJECT.

SECTION 506. PROHIBITION ON MANAGEMENT ENTITIES.

A MEMBER OF THE MANAGEMENT ENTITY MAY NOT RECEIVE MONEY

DIRECTLY OR INDIRECTLY FROM THE TRID.

SECTION 4. SECTIONS 701 AND 702 OF THE ACT ARE AMENDED TO

READ:

Section 701. Creation of value capture area.

In conjunction with the formal establishment of the TRID

boundaries, a coterminous value capture area shall

simultaneously be created to enable local municipalities, school

districts, the county and the public transportation agency to

share the increased tax increment of real estate and other

designated tax revenues generated by new real estate investment

within the TRID. The participants in the TRID, through the

designated management entity, shall develop an administrative

and project schedule and budget to implement the project,

including future maintenance needs, as defined in the TRID

planning study, as well as the shares and use of [such tax] the

incremental revenues as are projected to be generated from the

TRID value capture area. The participating municipality or

municipalities may review and revise the TRID budget.

Section 702. [Dedication of tax revenues] FINANCING OF PROJECT

COSTS.

[Tax] A portion of incremental tax revenues [generated

within] TRANSFERRED TO a TRID shall be dedicated to completion

and future maintenance of the specific and necessary transit

capital and public infrastructure improvements designated in the

comprehensive plan amendment and TRID planning study as follows:

(1) Local [municipalities and counties shall not use

such revenues for general government purposes, and a public

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transportation agency shall not use such revenues for transit

capital investments elsewhere on the public transportation

system.] taxing bodies shall approve that portion of revenues

which shall be dedicated to support TRID implementation and

that portion which shall be dedicated for general government

purposes.

(1.1) A public transportation agency may not use the

revenue for a transit capital investment outside of a

designated TRID except if the investment is necessary and

integral to achieve an approved TRID implementation

objective.

(2) Local municipalities, school districts and the

county shall establish an amortization schedule for receipt,

investment and expenditure of any TRID tax incremental

revenues[, not to exceed 20 years,] similar to [the

amortization schedule], BUT NOT LIMITED BY, THE FINANCING OF

COSTS PROVISIONS in the act of July 11, 1990 (P.L.465,

No.113), known as the Tax Increment Financing Act. [However,

where a municipal or joint municipal authority has been

created, it shall be responsible for fixing the amortization

schedule and for defining the TRID capital improvement plan.]

Incremental tax revenue generated by a TRID property may be

directed for use in TRID projects for up to 20 years from the

date a property is designated as a TRID. OR ELIGIBLE

PROJECTS, INCLUDING FOR USE IN FINANCING A BOND OR NOTE THE

PROCEEDS OF WHICH ARE USED IN TRID PROJECTS OR ELIGIBLE

PROJECTS, FOR UP TO 20 YEARS FROM THE DATE A PROPERTY IS

DESIGNATED AS A PARCEL THAT WILL CONTRIBUTE TAX REVENUE IN A

TRID.

(3) FOR THE PURPOSES OF THIS ACT, PROJECT COSTS AND THE

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FINANCING THEREOF SHALL BE REGARDED AS LIKE AND SIMILAR TO

THE PROVISIONS DELINEATED IN THE TAX INCREMENT FINANCING ACT.

Section 3 5. The act is amended by adding a chapter to read:

CHAPTER 8

CAPTURE OF TRID TAX REVENUE

Section 801. Definitions.

The following words and phrases when used in this chapter

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Baseline year." The calendar year the department approved

the TRID as a recipient of tax revenue generated within the

TRID.

"Bond." The term includes a note, instrument, refunding note

or other evidence of indebtedness or obligation.

"Department." The Department of Revenue of the Commonwealth.

"Eligible project." Development or improvement within a

TRID, including construction, infrastructure and site

preparation, reconstruction or renovation of a facility within a

TRID which will result in economic development or transit-

oriented development in accordance with the TRID and the TRID

planning study.

"Eligible tax." As follows:

(1) Any of the following taxes if generated within an

area of not more than 100 acres, comprised of parcels

designated by the management entity:

(i) Corporate net income tax, capital stock and

franchise tax or bank shares tax, calculated and

apportioned as to amount attributable to the location

within the TRID and calculated under section 1904 - B(b)

and (c) of the act of March 4, 1971 (P.L.6, No.2), known

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as the Tax Reform Code of 1971.

(ii) Sales and use tax, only to the extent the tax

is related to the activity of a qualified business within

the TRID.

(iii) Personal income tax withheld from its

employees by a qualified business for work performed in

the TRID.

(iv) Tax paid to the Commonwealth related to the

sale of liquor, wine or malt or brewed beverages in the

TRID.

(v) Real estate taxes.

(2) The term does not include cigarette tax.

"Qualified business." As follows:

(1) An entity located or partially located in a TRID

which meets the requirements of all of the following:

(i) Has conducted an active trade or business in the

TRID.

(ii) Appears on the timely filed list under section

805(a).

(2) A construction contractor engaged in construction,

including infrastructure or site preparation, reconstruction

or renovation of a facility located in or partially in the

TRID.

(3) The term does not include an agent, broker or

representative of a business.

"TRID fund." A TRID fund established under section 806.

GRANT OF TRID REVENUE

SECTION 801. ESTABLISHMENT.

THERE IS ESTABLISHED A SPECIAL FUND IN THE STATE TREASURY TO

BE KNOWN AS THE TRID FUND. MONEYS DEPOSITED INTO THE FUND AND

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INTEREST WHICH ACCRUES FROM THOSE FUNDS SHALL BE USED FOR THE

PURPOSES DELINEATED IN THIS CHAPTER.

Section 802. Approval.

(a) Submission.--A management entity may apply to the

Department of Community and Economic Development to establish a

TRID fund DEPARTMENT for the purposes of funding an eligible

project or for covering debt service payments related to debt

incurred to fund an eligible project.

(b) Agencies.--The Department of Community and Economic

Development DEPARTMENT , IN CONSULTATION WITH THE OFFICE OF THE

BUDGET AND THE DEPARTMENT OF REVENUE , shall approve two

applications within six months of the effective date of this

section and may approve additional applications thereafter.

Economic Development DEPARTMENT shall develop a schedule for the

approval of applications . provided that an application under

this section shall be approved or disapproved within 90 days of

the postmark date of the submission. An application which is not

disapproved within the time period under this subsection shall

be deemed to be approved.

(d) Reapplication.--If an application is not approved under

this section, the applicant may revise the application and plan

and reapply for approval.

Section 803. Additional powers of management entities.

In addition to other powers and functions of management

entities granted under this act, a management entity shall have

the power to borrow money for the purposes of executing a TRID

or TRID planning study for which a TRID fund AN APPLICATION has

been approved under section 802.

Section 804. Prohibition on management entities.

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A member of the management entity may not receive money

directly or indirectly from the TRID fund FUND .

Section 805. Qualified businesses.

(a) List.--By June 1 following the end of the baseline year,

and for every year thereafter, each management entity shall WORK

IN CONSULTATION WITH THE DEPARTMENT TO DEVELOP A LIST OF

BUSINESSES AND file with the department a complete list of all

businesses located in the TRID and all construction contractors

engaged in construction, reconstruction or renovation of a

facility in the TRID in the prior calendar year. The list shall

include for each business address, State tax identification

number and parcel number and a map of the TRID with parcel

numbers. NOTHING IN THIS SUBSECTION SHALL REQUIRE THE DEPARTMENT

TO DISCLOSE INFORMATION THAT IS PROTECTED BY LAW FROM

DISCLOSURE.

(b) Time.--If the list under subsection (a) is not timely

provided to the department, no eligible State tax shall be

certified by the department for the prior calendar year. , UNLESS

THE MANAGEMENT ENTITY REQUESTS AN EXTENSION FROM THE DEPARTMENT.

THE EXTENSION SHALL BE REQUESTED AT LEAST 30 DAYS PRIOR TO THE

DATE SPECIFIED IN SUBSECTION (A) AND MAY NOT BE FOR A PERIOD

LONGER THAN 30 DAYS UNLESS SPECIFICALLY APPROVED BY THE

DEPARTMENT.

Section 806. Funds.

(a) Notice.--Following the approval of an application under

section 802, the management entity shall notify the State

Treasurer.

(b) Establishment.--Upon receipt of notice under subsection

(a), the State Treasurer shall establish for each TRID a special

fund for the benefit of the management entity to be known as the

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TRID Fund. Interest income derived from investment of money in a

fund shall be credited by the State Treasury to the fund.

Section 807. Reports.

(a) TRID report.--By June 15 following the baseline year and

each year thereafter, each qualified business shall file a

report with the department in a form or manner required by the

department which includes all of the following:

(1) Amount of each eligible tax which was paid to the

Commonwealth by the qualified business in the prior calendar

year.

(2) Amount of each eligible tax refund received from the

Commonwealth in the prior calendar year by the qualified

business.

(b) Penalties.--

(1) Failure to file a timely and complete report under

subsection (a) may result in the imposition of a penalty of

the lesser of:

(i) ten percent of all eligible tax due the taxing

authority in the prior calendar year; or

(ii) one thousand dollars.

(2) A penalty for a violation of subsection (a) shall be

imposed, assessed and collected by the department under

procedures set forth in Article II of the act of March 4,

1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

Money collected under this paragraph shall be deposited in

the General Fund.

(3) NO PENALTIES SHALL BE IMPOSED UNDER THIS SECTION ON

QUALIFIED BUSINESSES FOR A YEAR IN WHICH THE AMOUNT CERTIFIED

FOR THE TRID EXCEEDS $350,000.

Section 808. Calculation of baseline.

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(a) Baseline tax.--By October 15 following the end of the

baseline year and for each year thereafter, the department shall

verify the State baseline tax amount which consists of 75% of

the following:

(1) For qualified businesses that file timely TRID

reports under section 807, the amount of eligible State tax

paid, less eligible State tax refunds.

(2) For qualified businesses not included under

paragraph (1) but located or partially located in the TRID as

determined by the department or included in the information

received by the department under section 807(a), the amount

of eligible State tax paid, less eligible State tax refunds.

(b) Moves and noninclusions.--

(1) This subsection applies to a qualified business

that:

(i) moves into a zone from within this Commonwealth

after the baseline year; or

(ii) is in a zone but not included in the

calculation of the State baseline tax under subsection

(a).

(2) A qualified business subject to paragraph (1) shall

file a TRID report under section 807 following the end of the

first full calendar year in which the qualified business

conducted business in the TRID and each calendar year

thereafter. The amount of eligible State tax verified by the

department for the qualified business for the prior calendar

year shall be added to the State baseline tax amount for the

zone for the prior calendar year and each year thereafter.

(3) The calculation under this section may not include

the eligible taxes of a qualifying business moving into the

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TRID from outside this Commonwealth.

Section 809. Certification.

(a) Amounts.--By the October 15 following the baseline year,

and each year thereafter, the department shall do all of the

following for the prior calendar year:

(1) Make the following calculation for qualified

businesses which file TRID reports under section 807(a),

separately for each TRID:

(i) Subtract:

(A) the amount of eligible State tax refunds

received; from

(B) the amount of eligible State tax paid.

(ii) Subtract:

(A) the State tax baseline amount for the zone;

from

(B) the difference under subparagraph (i).

(2) Certify to the Office of the Budget the difference

under paragraph (1)(ii).

(b) Content.--

(1) The certification may include the following:

(i) Adjustment made to timely filed TRID reports by

the department for eligible State tax actually paid by a

qualified business in the prior calendar year.

(ii) Eligible State tax refunds paid to a qualified

business in the TRID in a prior calendar year.

(iii) State tax penalties paid by a qualified

business in the prior year under section 807(b).

(2) The certification shall not include the following:

(i) Tax paid by a qualified business that did not

file a timely TRID report under section 807(a).

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(ii) Tax paid by a qualified business whose tax was

not included in the State tax baseline amount calculation

under section 808.

(iii) Tax paid by a qualifying business not

appearing on a timely filed list under section 805(a).

CALCULATE OR CERTIFY STATE TAX AMOUNTS IN EXCESS OF $350,000 PER

ANNUM FOR EACH TRID.

Section 810. Transfers.

(a) Office.--Within 10 days of receiving the certification

from the department under section 809, the Office of the Budget

shall direct the State Treasurer to transfer the amount of

certified eligible TRID tax not to exceed $350,000 per annum

from the General Fund to each TRID fund.

(b) State Treasurer.--Within 10 days of receiving direction

under subsection (a), the State Treasurer shall pay into the

TRID fund the amount directed under subsection (a) until bonds

OR NOTES issued to finance the construction, including related

infrastructure and site preparation, reconstruction or

renovation of a facility or other eligible project in the TRID

are retired.

(1) If the transfers under subsection (a) are

insufficient to make payments on the bonds OR NOTES issued

under section 811(a)(1) for the calendar year when the

transfers are made, the management entity shall notify the

Department of Community and Economic Development, the Office

of the Budget and the department of the amount of additional

money necessary to make payments on the bonds OR NOTES .

(2) The notification under paragraph (1) must be

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accompanied by a detailed account of the management entity's

expenditures and the calculation which resulted in the

request for additional money. The Department of Community and

Economic Development, the Office of the Budget or the

department may request additional information from the

management entity and shall jointly verify the proper amount

of money necessary to make the payments on the bonds OR

NOTES .

(3) Notwithstanding 53 Pa.C.S. § 5607(e) (relating to

purposes and powers) within 90 days of the date of the

notification request, the Office of the Budget shall direct

the State Treasurer to establish a restricted account within

the General Fund. The Office of the Budget shall direct the

State Treasurer to transfer the amount verified under

paragraph (2) from the General Fund to the restricted account

for the use of the management entity to make payments on the

bonds OR NOTES issued under section 811(a)(1).

(4) Money transferred under paragraph (3):

(i) shall be limited to $100,000; and

(ii) must occur in the first seven calendar years

following the baseline year.

(5) Under extraordinary circumstances, a management

entity may request money in excess of the limitations under

paragraph (4)(i). The Department of Community and Economic

Development, the Office of the Budget and the department

shall determine whether the circumstances merit additional

money and the amount to be transferred. The money shall be

transferred under the procedure under this section.

(6) Money transferred under paragraph (3) OR (5) shall

be repaid to the General Fund by the management entity. If

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money transferred under paragraph (3) is not repaid to the

General Fund by the management entity by the date of the

final payment on the bonds OR NOTES originally issued under

section 811 (a) (1), the municipality or county and the transit

agency which established the management entity shall pay, in

equal shares, the money not repaid to the General Fund plus

an additional penalty of 10% of the amount outstanding on the

date of the final payment on the bonds OR NOTES originally

issued under section 811(a)(1).

SECTION 805. TRANSFERS.

(A) MATCHING FUNDS.--THE AMOUNT OF MONEY TRANSFERRED FROM

THE TRID FUND UTILIZED FOR THE CONSTRUCTION, INCLUDING RELATED

SITE PREPARATION AND INFRASTRUCTURE, RECONSTRUCTION OR

RENOVATION OF FACILITIES, SHALL BE MATCHED BY OTHER SOURCES OF

FUNDING AT A RATIO OF TWO FUND DOLLARS TO ONE PRIVATE DOLLAR.

(B) REPORT.--BY APRIL 1, FOLLOWING YEAR ONE, AND FOR EACH

YEAR THEREAFTER, THE MANAGEMENT ENTITY SHALL FILE AN ANNUAL

REPORT WITH THE DEPARTMENT AND THE OFFICE OF THE BUDGET THAT

CONTAINS A DETAILED ACCOUNT OF THE TRID FUND MONEY EXPENDITURES

AND THE EXPENDITURES OF FUNDS FROM OTHER SOURCES AND A

CALCULATION OF THE RATIO IN SUBSECTION (A) FOR THE PRIOR

CALENDAR YEAR. THE AGENCIES SHALL DETERMINE WHETHER SUFFICIENT

FUNDING FROM OTHER SOURCES WAS UTILIZED.

THE MATCHING FUNDING REQUIREMENT, THE AGENCIES SHALL ALLOW A

MANAGEMENT ENTITY TO DEMONSTRATE THAT A MULTIYEAR ELIGIBLE

MATCHING FUNDING INVESTMENT WAS MADE IN A PARTICULAR YEAR. IN

SUBSEQUENT YEARS, THE MANAGEMENT ENTITY SHALL REFER TO THE GROSS

MATCHING FUND INVESTMENT IN THE YEAR IT WAS ESTABLISHED AND

CARRY FORWARD A CREDIT IN AN AMOUNT OF THE ORIGINAL INVESTMENT

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MINUS THE FUNDS ALREADY APPLIED AS A MATCHING FUND REQUIREMENT,

UP TO THE REMAINING MATCHING FUNDS.

(D) DEDUCTION.--IF IT IS DETERMINED THAT INSUFFICIENT

FUNDING FROM OTHER SOURCES WAS UTILIZED UNDER SUBSECTION (A),

THE AMOUNT OF TRID FUND MONEY UTILIZED UNDER SUBSECTION (A) IN

THE PRIOR CALENDAR YEAR SHALL BE DEDUCTED FROM THE NEXT TRANSFER

OF THE FUND.

(E) FINANCIAL APPROVAL.--UPON BEING SATISFIED THAT ALL

REQUIREMENTS HAVE BEEN MET INCLUDING PRIVATE DOLLAR MATCH, THE

DEPARTMENT SHALL NOTIFY THE STATE TREASURER TO ISSUE A GRANT IN

AN AMOUNT NOT TO EXCEED $350,000 ANNUALLY, AS ESTABLISHED BY THE

SECRETARY OF THE BUDGET PER TRID.

(F) SALES TAX TRANSFER.--ON JUNE 1, 2016, AND ON EACH JUNE 1

FOR THE NEXT 20 CALENDAR YEARS, $700,000 FROM THE TAX IMPOSED BY

ARTICLE II OF THE ACT OF MARCH 4, 1971 (P.L.6, NO.2), KNOWN AS

THE TAX REFORM CODE OF 1971, SHALL BE TRANSFERRED TO THE TRID

FUND FOR PAYMENT TO THE FIRST TWO TRIDS APPROVED UNDER SECTION

802(B).

(G) REMAINING TRID FUND MONEY.--EACH YEAR AFTER THE

TRANSFERS FROM THE TRID FUND TO THE TRIDS UNDER SUBSECTION (F),

ANY MONEY REMAINING IN THE TRID FUND SHALL BE RETURNED TO THE

GENERAL FUND.

(H) GRANTS TO OTHER TRIDS.--FOR ANY TRID OTHER THAN THE

FIRST TWO TRIDS APPROVED UNDER SECTION 802(B), THE DEPARTMENT

MAY PROVIDE GRANTS OF UP TO $350,000 EACH YEAR FOR THE PURPOSES

DELINEATED IN THIS CHAPTER.

Section 811 806 . Restrictions.

(a) Utilization.--If the use was approved in an application

filed under section 802, money transferred under section 810 805

may only be utilized for the following:

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(1) Payment of debt service on bonds OR NOTES issued for

the construction, including related infrastructure and site

preparation, reconstruction or renovation of a facility in

the TRID.

(2) Construction, including related infrastructure and

site preparation, reconstruction or renovation of all or a

part of a facility.

(3) Replenishment of amounts in debt service reserve

funds established to pay debt service on bonds OR NOTES .

(4) Improvement or development of all or part of a TRID.

(5) Improvement projects, including fixtures and

equipment for a facility owned by a public authority.

(b) Excess money.--

(1) If the amount of money transferred to the fund under

section 810 805 in any one calendar year exceeds the money

utilized under this section in that calendar year, the

management entity shall submit by January 15 following the

end of the calendar year the excess money to the State

Treasurer for deposit into the General Fund.

(2) At the time of submission to the State Treasurer,

the management entity shall submit to the State Treasurer,

the Office of the Budget and department a detailed accounting

of the calculation resulting in the excess money.

(3) The excess money shall be credited to the management

entity and applied to the amount required to be repaid under

section 810(c)(6) until there is full repayment.

(1) The amount of money transferred from the TRID fund

utilized for the construction, including related site

preparation and infrastructure, reconstruction or renovation

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of facilities shall be matched by other sources of funding at

a ratio of two fund dollars to one private dollar BY A SOURCE

OTHER THAN A TRID FUND .

(2) By April 1, following the baseline year and for each

year thereafter, the management entity shall file an annual

report with the Department of Community and Economic

Development, the Office of the Budget and the department that

contains detailed account of the fund money expenditures and

the expenditures of funds from other sources and a

calculation of the ratio in paragraph (1) for the prior

calendar year. The agencies shall determine whether

sufficient funding from other sources was utilized.

(3) If it is determined that insufficient funding from

other sources was utilized under paragraph (1), the amount of

TRID fund money utilized under paragraph (1) in the prior

calendar year shall be deducted from the next transfer of the

fund.

Section 812. Duration.

A TRID fund shall be in effect for:

(1) the amount of time required to complete any approved

eligible project for which debt was not incurred; or

(2) a period equal to the length of time for the

repayment of debt incurred for the TRID, including bonds OR

NOTES issued. Bonds OR NOTES shall be paid no later than 30

years following the initial issuance of the bonds OR NOTES .

SECTION 807. EXPIRATION.

THE TRID FUND SHALL EXPIRE ON DECEMBER 31, 2035. UPON

EXPIRATION, MONEY IN THE FUND NOT ENCUMBERED SHALL LAPSE TO THE

GENERAL FUND.

Section 813 808 . Commonwealth pledges.

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(a) Pledge.--If and to the extent the management entity

pledges amounts required to be transferred to its TRID fund THE

TRID FUND under section 810 805 for payment of bonds OR NOTES

issued by the management entity, until all bonds DEBT BONDS

secured by the pledge of the management entity, together with

interest on the bonds DEBT BONDS , are fully paid or provided

for, the Commonwealth pledges to and agrees with any person,

firm, corporation or government agency, in this Commonwealth or

elsewhere and pledges to and agrees with any Federal agency

subscribing to or acquiring the bonds OR NOTES of the

contracting authority OF THE MANAGEMENT ENTITY that the

Commonwealth will not, nor will it authorize any government

entity to, do any of the following:

(1) Abolish or reduce the size of the TRID .

(2) Amend or repeal section 808 or 809.

(3) (2) Limit or alter the rights vested in the

management entity in a manner inconsistent with the

obligations of the management entity with respect to the

bonds DEBT BONDS issued by the management entity.

(4) (3) Impair revenue to be paid under this chapter to

the management entity necessary to pay debt service on bonds

OR NOTES .

(b) Limitation.--Nothing under this section shall limit the

authority of the Commonwealth to change the rate, base or

subject of a specific tax or to repeal or enact any tax.

Section 814. Confidentiality.

(a) Sole use.--A TRID report or certification under this

chapter shall only be used by the management entity, the

Department of Community and Economic Development, the Office of

the Budget or the department to verify the amount of the State

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tax baseline amount calculated under section 808 and State tax

certification under section 809.

(b) Prohibition.--Use of a TRID report other than as

provided under subsection (a) shall be prohibited and shall be

subject to the law applicable to the confidentiality of tax

records.

Section 815 809 . Guidelines.

The Department of Community and Economic Development,

DEPARTMENT AND the Office of the Budget and the department shall

develop and publish guidelines necessary to implement this

chapter.

Section 4 6. Section 901 of the act is amended to read:

Section 901. Public meeting to explain TRID and alternative

implementation approaches.

Community and public involvement in the establishment of

TRIDs is required. The municipality and the public

transportation agency shall jointly conduct at least one public

meeting in the proposed TRID area prior to the enactment of a

TRID[,] and TRID planning study[, comprehensive plan or zoning

amendment]. The meeting is intended to explain the purpose and

components of the TRID and the alternative implementation

approaches. The public meeting or meetings shall be in addition

to any required local government public hearing or hearings

prior to comprehensive or multimunicipal plan amendment

adoption. However, nothing in this act shall relieve the [TRID

management entity] municipality or public transportation entity

AGENCY from conducting all public meetings required by law where

the TRID is acting or seeking to act under the:

(1) Act of May 24, 1945 (P.L.991, No.385), known as the

Urban Redevelopment Law.

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(2) Act of July 11, 1990 (P.L.465, No.113), known as the

Tax Increment Financing Act.

(3) Act of December 20, 2000 (P.L.949, No.130), known as

the Neighborhood Improvement District Act.

Section 5 7. This act shall take effect in 60 days.

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