1Amend Bill, page 1, lines 6 and 7, by striking out all of
2said lines and inserting

3Section 1. Section 8811(a) of Title 53 of the Pennsylvania 
4Consolidated Statutes is amended and subsection (b) is amended 
5by adding a paragraph to read:

6Amend Bill, page 1, line 9, by striking out all of said line
7and inserting

8(a) Subjects of taxation enumerated.--Except as provided in
9subsection (b), all subjects and property made taxable by the
10laws of this Commonwealth for county, city, borough, town,
11township and school district purposes shall, as provided in this
12chapter, be valued and assessed at the annual rates, including
13all:

14(1) Real estate, namely:

15(i) houses;

16(ii) house trailers and mobile homes permanently
17attached to land or connected with water, gas, electric
18or sewage facilities;

19(iii) buildings permanently attached to land or
20connected with water, gas, electric or sewage facilities;

21(iv) lands, lots of ground and ground rents, trailer
22parks and parking lots;

23(v) mills and manufactories of all kinds, furnaces,
24forges, bloomeries, distilleries, sugar houses, malt
25houses, breweries, tan yards, fisheries, ferries and
26wharves;

27(vi) all office buildings;

28(vii) that portion of a steel, lead, aluminum or
29like melting and continuous casting structure which
30encloses or provides shelter or protection from the
31elements for the various machinery, tools, appliances,
32equipment, materials or products involved in the mill,
33mine, manufactory or industrial process; and

34(viii) telecommunication towers that have become
35affixed to land.

36(1.1) Rights held pursuant to a lease or other agreement

1subject to the act of July 20, 1979 (P.L.183, No.60),
2entitled "An act regulating the terms and conditions of
3certain leases regarding natural gas and oil," to extract,
4remove or recover gas, including natural gas, or oil shall be
5subject to taxation as real estate for all county, city,
6borough, town, township and school district purposes. The
7rights shall be assessed and taxed separately from the
8surface property assessment, in the name of the holder of
9such rights, and valued in accordance with section 8842(d)
10(relating to valuation of property). The following apply:

11(i) A political subdivision shall retain 10% of the
12revenues collected under this paragraph and shall remit
13the remainder of the revenues to the State Treasurer who
14shall allocate the moneys received as follows:

15(A) Forty percent shall be distributed to the
16Department of Education for the purpose of providing
17basic education funding to school districts.

18(B) Twenty-five percent shall be deposited in
19the Motor License Fund for costs of public highway
20and bridge construction.

21(C) Twenty-five percent shall be deposited in
22the Public Transportation Trust Fund for mass transit
23programs.

24(ii) The provisions of this paragraph are not 
25intended, nor shall they be construed, to affect any 
26other determination, including, but not limited to, the 
27determination of royalty due under mineral leases. 
28Notwithstanding any other provision of law, any tax 
29imposed by this chapter shall not reduce any royalty 
30payments due under mineral leases, and the producer under 
31a mineral lease may not recover any portion of the tax 
32paid from the royalty owner through other means of 
33deduction or reallocation, notwithstanding any provision 
34in the lease, contract or agreement.

35(2) All other things now taxable by the laws of this
36Commonwealth for taxing districts.

37Amend Bill, page 2, by inserting between lines 3 and 4

38Section 2. Section 8842 of Title 53 is amended by adding a
39subsection to read:

40§ 8842. Valuation of property.

41* * *

42(d) Gas and oil leases.--The valuation of rights held
43pursuant to a lease or other agreement subject to the act of
44July 20, 1979 (P.L.183, No.60), entitled "An act regulating the
45terms and conditions of certain leases regarding natural gas and
46oil," to extract, remove or recover gas, including natural gas,
47or oil shall be developed by the county assessor utilizing the
48income approach to value based upon the discounted value of the
49rights, supplemented by the sales comparison data approach as

1deemed necessary by the county assessor. The lessee or operator,
2or lessor on behalf of the lessee or operator, shall annually,
3no later than July 1, provide the county assessor with such
4nonproprietary lease and lease income information as the
5assessor determines is reasonably needed to determine value. The
6board may change the assessed valuation of the rights in the
7event information becomes available that would significantly
8affect the valuation, including, but not limited to,
9commencement of production on or near the property and the
10depletion of the hydrocarbon gas subject to the lease and
11related production.

12Amend Bill, page 2, line 4, by striking out "2" and inserting

13 3