Amendment 1241 to House Bill 504 P.N. 561, Regular Session 2015-2016

H0504B0561A01241 AJM:JSL 05/12/15 #90 A01241

AMENDMENTS TO HOUSE BILL NO. 504 (As amended by A01564)

Sponsor: REPRESENTATIVE HARPER

Printer's No. 561

Amend Bill, page 1, lines 1 through 35; pages 2 through 21,

lines 1 through 51; page 22, lines 1 through 43 (A01564), by

striking out all of said lines on said pages and inserting

Amend Bill, page 1, line 11, by removing the period after

"timbering" and inserting

; establishing the Senior Citizen Property Tax Rent Rebate Act;

and repealing provisions relating to the Taxpayer Relief Act.

Amend Bill, page 7, line 10, by striking out all of said line

and inserting

Section 2. The act is amended by adding an article to read:

ARTICLE XVI

SENIOR CITIZEN PROPERTY TAX RENT REBATE

PART I

PRELIMINARY PROVISIONS

Section 1601. Short title of article.

This article shall be known and may be cited as the Senior

Citizen Property Tax Rent Rebate Act.

Section 1602. Definitions.

The following words and phrases when used in this article

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

context clearly indicates otherwise:

"Board." The Board of Finance and Revenue of the

Commonwealth.

"Claimant." A person who files a claim for property tax

rebate or rent rebate in lieu of property taxes and:

(1) was at least 65 years of age or whose spouse, if a

member of the household, was at least 65 years of age during

a calendar year in which real property taxes or rent were due

and payable;

(2) was a widow or widower and was at least 50 years of

age during a calendar year or part thereof in which real

property taxes or rent were due and payable; or

(3) was a person with permanent disabilities 18 years of

age or older during a calendar year or part thereof in which

the real property taxes or rent were due and payable.

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

"Homestead." A dwelling, whether owned or rented, and so

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much of the land surrounding it as is reasonably necessary for

the use of the dwelling as a home which is occupied by a

claimant. The term includes, but is not limited to:

(1) Premises occupied by reason of ownership or lease in

a cooperative housing corporation.

(2) Mobile homes which are assessed as realty for local

property tax purposes and the land, if owned or rented by the

claimant, upon which the mobile home is situated, and other

similar living accommodations.

(3) A part of a multidwelling or multipurpose building

and a part of the land upon which it is built.

(4) Premises occupied by reason of the claimant's

ownership or rental of a dwelling located on land owned by a

nonprofit incorporated association, of which the claimant is

a member, if the claimant is required to pay a pro rata share

of the property taxes levied against the association's land.

(5) Premises occupied by a claimant if the claimant is

required by law to pay a property tax by reason of the

claimant's ownership or rental, including a possessory

interest, in the dwelling, the land or both. An owner

includes a person in possession under a contract of sale,

deed of trust, life estate, joint tenancy or tenancy in

common or by reason of statutes of descent and distribution.

"Household income." All income received by a claimant and

the claimant's spouse while residing in the homestead during the

calendar year for which a rebate is claimed.

"Income." All income from any source, including, but not

limited to:

(1) Salaries, wages, bonuses, commissions, income from

self-employment, alimony, support money, cash public

assistance and relief.

(2) The gross amount of any pensions or annuities,

including railroad retirement benefits for calendar years

prior to 1999 and 50% of railroad retirement benefits for

calendar years 1999 and thereafter.

(3) (i) All benefits received under the Social Security

Act (49 Stat. 620, 42 U.S.C. § 301 et seq.), except

Medicare benefits, for calendar years prior to 1999, and

50% of all benefits received under the Social Security

Act, except Medicare benefits, for calendar years 1999

and thereafter.

(ii) Notwithstanding any other provision of this

article to the contrary, persons who, as of December 31,

2012, are eligible for the property tax or rent rebate

shall remain eligible if the household income limit is

exceeded due solely to a Social Security cost-of-living

adjustment.

(iii) Eligibility in the property tax and rent

rebate program pursuant to subparagraph (ii) shall expire

on December 31, 2016.

(4) All benefits received under State unemployment

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insurance laws and veterans' disability payments.

(5) All interest received from the Federal or any state

government or any instrumentality or political subdivision

thereof.

(6) Realized capital gains and rentals.

(7) Workers' compensation.

(8) The gross amount of loss of time insurance benefits,

life insurance benefits and proceeds, except the first $5,000

of the total of death benefit payments.

(9) Gifts of cash or property, other than transfers by

gift between members of a household, in excess of a total

value of $300.

The term does not include surplus food or other relief in kind

supplied by a governmental agency, property tax or rent rebate

or inflation dividend.

"Person with permanent disabilities." A person who is unable

to engage in any substantial gainful activity by reason of any

medically determinable physical or mental impairment which can

be expected to continue indefinitely, except as provided in

section 1621(b)(3) and (c).

"Real property taxes." All taxes on a homestead, exclusive

of municipal assessments, delinquent charges and interest, due

and payable during a calendar year.

"Rent rebate in lieu of property taxes." Twenty percent of

the gross amount actually paid in cash or its equivalent in any

calendar year to a landlord in connection with the occupancy of

a homestead by a claimant, irrespective of whether such amount

constitutes payment solely for the right of occupancy or

otherwise.

"Secretary." The Secretary of Revenue of the Commonwealth.

"Taxpayer Relief Act." The act of June 27, 2006 (1st

Sp.Sess., P.L.1873, No.1), known as the Taxpayer Relief Act.

"Widow" or "widower." The surviving wife or the surviving

husband, as the case may be, of a deceased individual and who

has not remarried except as provided in section 1621(b)(3) and

(c).

Section 1603. Senior Citizen Property Tax Rebate Fund.

(a) Establishment.--The Senior Citizen Property Tax Rebate

Fund is established as a special fund in the State Treasury.

The fund shall not lapse.

(b) Purpose.--Money in the fund shall be utilized for senior

citizen property tax rebates as established in Part III.

under section 1602 shall be deposited into the fund.

PART II

ADDITIONAL SALES AND USE TAX

Section 1611. Additional sales and use tax imposed.

(a) Additional taxation.--The tax imposed by this section

shall be in addition to any tax imposed under Article II or II-

B, section 503 of the act of June 5, 1991 (P.L.9, No.6), known

as the Pennsylvania Intergovernmental Cooperation Authority Act

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for Cities of the First Class, or section 3152-B of the act of

July 28, 1953 (P.L.73, No.230), known as the Second Class County

Code. The provisions of Article II shall apply to the tax

imposed by this section.

(b) Sales tax.--Beginning January 1, 2016, there is imposed

a tax upon each separate sale at retail of tangible personal

property or services. The tax under this subsection shall be

imposed upon the purchase price. The tax shall be collected by

the vendor from the purchaser and shall be paid over to the

Commonwealth in the same manner as provided in Article II.

tax upon the use of tangible personal property purchased at

retail and on services purchased at retail. The tax under this

subsection shall be imposed upon the purchase price. The tax

shall be paid over to the Commonwealth by the person who makes

such use. The tax imposed under this subsection shall not be

paid over to the Commonwealth by any person who has paid the tax

imposed under subsection (b) or has paid the tax imposed under

this subsection to the vendor with respect to such use.

(d) Hotel tax.--Beginning January 1, 2016, there is imposed

an excise tax on the rent upon every occupancy of a room or

rooms in a hotel, as defined in Article II. The tax shall be

collected by the operator or owner from the occupant and paid

over to the Commonwealth.

(e) Rate.--The tax imposed by subsections (b), (c) and (d)

shall be at a rate of 0.5%.

(f) Tax computation.--The tax imposed under subsections (b),

(1) If the purchase price is 50¢ or less, no tax shall

be collected.

(2) If the purchase price is 51¢ or more but less than

$1.51, 1¢ shall be collected.

(3) If the purchase price is $1.51 or more but less than

$2.51, 2¢ shall be collected.

(4) If the purchase price is $2.51 or more but less than

$3.51, 3¢ shall be collected.

(5) If the purchase price is $3.51 or more but less than

$4.51, 4¢ shall be collected.

(6) If the purchase price is $4.51 or more but less than

$5.51, 5¢ shall be collected.

(7) If the purchase price is $5.51 or more but less than

$6.51, 6¢ shall be collected.

(8) If the purchase price is $6.51 or more but less than

$7.51, 7¢ shall be collected.

(9) If the purchase price is $7.51 or more but less than

$8.51, 8¢ shall be collected.

(10) If the purchase price is $8.51 or more but less

than $9.51, 9¢ shall be collected.

(11) If the purchase price is $9.51 or more but less

than $10.01, 10¢ shall be collected.

(12) If the purchase price is more than $10, 0.5% of

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each $10 purchase price plus the above bracket charges upon

any fractional part of a $10 increment shall be collected.

(g) Deposit of tax proceeds.--The department shall deposit

taxes collected under this section in the Senior Citizen

Property Tax Rebate Fund. The amount shall be the sum of taxes

collected under this section and Article II multiplied by a

fraction equal to the rate of tax imposed under this section

divided by the sum of the rate of the tax imposed under this

section and the rate of tax imposed under Article II.

(h) Rules and regulations.--The rules and regulations of the

department which are promulgated under Article II or any other

act, shall be applicable to the tax imposed by this section to

the extent that they are applicable to the tax imposed under

Article II.

(i) Definitions.--As used in this section, the following

words and phrases shall have the meanings given to them in this

subsection unless the context clearly indicates otherwise:

"Purchase price." As defined in Article II.

"Sale at retail." As defined in Article II.

"Tangible personal property." As defined in Article II.

PART III

SENIOR CITIZENS PROPERTY TAX

AND RENT REBATE ASSISTANCE

Section 1621. Property tax and rent rebate.

(a) Schedule of rebates.--

(1) The amount of any claim for property tax rebate or

rent rebate in lieu of property taxes for real property taxes

or rent due and payable during calendar years 1985 through

2005 shall be determined in accordance with the following

schedule:

Household Income

Percentage of Real

Property Taxes or

Rent Rebate in Lieu of

Property Taxes Allowed

as Rebate

$ 0 - $ 4,999 100%

5,000 - 5,499 100

5,500 - 5,999 90

6,000 - 6,499 80

6,500 - 6,999 70

7,000 - 7,499 60

7,500 - 7,999 50

8,000 - 8,499 40

8,500 - 8,999 35

9,000 - 9,999 25

10,000 - 11,999 20

12,000 - 12,999 15

13,000 - 15,000 10

(2) The following apply:

(i) The base amount of any claim for property tax

rebate for real property taxes due and payable during

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calendar year 2006 through 2016 shall be determined in

accordance with the following schedule:

Household Income

Amount of Real Property

Taxes

Allowed as Rebate

$ 0 - $ 8,000 $650

8,001 - 15,000 500

15,001 - 18,000 300

18,001 - 35,000 250

(ii) The supplemental amount for a claimant with a

household income equal to or less than $30,000 and an

eligible claim for property tax rebate for real property

taxes due and payable during the calendar year preceding

the first year in which a payment under section 1625(b)

of the Taxpayer Relief Act is made and each year

thereafter and whose real property taxes exceed 15% of

the claimant's household income shall be equal to 50% of

the base amount determined under subparagraph (i). A

claimant who is a resident of a city of the first class,

a city of the second class A or a school district of the

first class A shall be ineligible for the supplemental

amount under this subparagraph.

(3) The amount of any claim for rent rebate in lieu of

property taxes for rent due and payable during calendar year

2006 and thereafter shall be determined in accordance with

the following:

Household Income

Amount of Rent Rebate in

Lieu of Property Taxes

Allowed as Rebate

$ 0 - $ 8,000 $650

8,001 - 15,000 500

(4) The following apply:

(i) The base amount of any claim for property tax

rebate for real property taxes due and payable during the

calendar year 2017 and thereafter shall be determined in

accordance with the following schedule:

Household Income

Amount of Real Property

Taxes

Allowed as Rebate

$ 0 - $ 8,000 $1,700

8,001 - 15,000 1,600

15,001 - 18,000 1,500

18,001 - 35,000 1,400

35,001 - 40,000 1,300

40,001 - 50,000 1,200

(b) Limitations on claims.--

(1) No claim through calendar year 2005 shall be allowed

if the amount of property tax or rent rebate computed in

accordance with this section is less than $10, and the

maximum amount of property tax or rent rebate payable shall

not exceed $500.

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(2) For calendar year 2006 and thereafter, the maximum

amount of property tax or rent rebate in lieu of property

taxes payable shall not exceed the lesser of:

(i) the amount of a claim under subsection (a)(2) or

(3);

(ii) the amount of real property taxes actually

paid; or

(iii) twenty percent of gross rent actually paid.

(3) No claim shall be allowed if the claimant is a

tenant of an owner of real property exempt from real property

taxes.

(1) The department shall apportion the real property

taxes or rent in accordance with the period or degree of

ownership or leasehold or eligibility of the claimant in

determining the amount of rebate for which a claimant is

eligible if any of the following exist relating to a claim:

(i) a homestead is owned or rented and occupied for

only a portion of a year or is owned or rented in part by

a person who does not meet the qualifications for a

claimant, exclusive of any interest owned or leased by a

claimant's spouse;

(ii) the claimant is a widow or widower who

remarries; or

(iii) the claimant is a formerly disabled person who

is no longer disabled.

(2) A claimant who receives public assistance from the

Department of Human Services shall not be eligible for rent

rebate in lieu of property taxes during those months within

which the claimant receives public assistance.

(d) Government subsidies.--Rent shall not include subsidies

provided by or through a governmental agency.

Section 1622. Filing of claim.

(a) General rule.--Except as otherwise provided in

subsection (b), a claim for property tax or rent rebate shall be

filed with the department on or before the 30th day of June of

the year next succeeding the end of the calendar year in which

real property taxes or rent was due and payable.

(b) Exception.--A claim filed after the June 30 deadline

until December 31 of such calendar year shall be accepted by the

secretary as long as money is available to pay the benefits to

the late filing claimant.

claim shall be made from the State Lottery Fund earlier than the

day following the 30th day of June provided in this part on

which that claim may be filed with the department.

(d) Eligibility of claimants.--

(1) Only one claimant from a homestead each year shall

be entitled to the property tax or rent rebate.

(2) If two or more persons are able to meet the

qualifications for a claimant, they may determine who the

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claimant shall be.

(3) If they are unable to agree, the department shall

determine to whom the rebate is to be paid.

Section 1623. Proof of claim.

(a) Contents.--Each claim shall include:

(1) Reasonable proof of household income.

(2) The size and nature of the property claimed as a

homestead.

(3) The rent, tax receipt or other proof that the real

property taxes on the homestead have been paid or rent in

connection with the occupancy of a homestead has been paid.

(4) If the claimant is a widow or widower, a declaration

of such status in such manner as prescribed by the secretary.

(b) Proof of disability.--

(1) Proof that a claimant is eligible to receive

disability benefits under the Social Security Act (49 Stat.

620, 42 U.S.C. § 301 et seq.) shall constitute proof of

disability under this part.

(2) No person who has been found not to be disabled by

the Social Security Administration shall be granted a rebate

under this part.

(3) A claimant not covered under the Social Security Act

shall be examined by a physician designated by the department

and such status determined using the same standards used by

the Social Security Administration.

not be necessary that taxes or rent were paid directly by the

claimant if the rent or taxes have been paid when the claim is

filed.

(d) Proof of age on first claim.--The first claim filed

shall include proof that the claimant or the claimant's spouse

was at least 65 years of age, or at least 50 years of age in the

case of a widow or widower during the calendar year in which

real property taxes or rent were due and payable.

Section 1624. Incorrect claim.

Whenever on audit of a claim the department finds the claim

to have been incorrectly determined, it shall redetermine the

correct amount of the claim and notify the claimant of the

reason for the redetermination and the amount of the corrected

claim.

Section 1625. Funds for payment of claims.

(a) Payment.--Approved claims shall be paid from the State

Lottery Fund established by the act of August 26, 1971 (P.L.351,

No.91), known as the State Lottery Law .

(b) Transfers.--The Secretary of the Budget shall transfer

the following amounts from the Property Tax Relief Fund to the

State Lottery:

(1) Notwithstanding any other provision of law, an

amount equal to $100,000,000 of the total slot machine

license fees paid by successful applicants for a Category 1

slot machine license under 4 Pa.C.S. § 1209 (relating to slot

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machine license fee). The transfer under this paragraph shall

occur upon deposit in the Property Tax Relief Fund of money

derived from the fee from the fourth successful applicant for

a Category 1 slot machine license.

(2) Notwithstanding any other provision of law, an

amount equal to $100,000,000 of the total slot machine

license fees paid by successful applicants for a Category 2

slot machine license under 4 Pa.C.S. § 1209. The transfer

under this paragraph shall occur upon deposit in the Property

Tax Relief Fund of money derived from the fee from the third

successful applicant for a Category 2 slot machine license.

(3) For fiscal years 2007-2008 and 2008-2009, an amount

equal to the sum of approved claims to be paid in each of

those fiscal years under section 704 of the Taxpayer Relief

Act and section 1621(a)(2)(ii), if any.

(4) For fiscal year 2009-2010 and each fiscal year

thereafter, all of the following:

(i) The difference between the sum of the amount of

approved claims to be paid in the next fiscal year under

section 1621(a)(2)(i) and (3) and the amount of approved

claims paid in fiscal year 2006-2007 under section

1621(a)(1).

(ii) The sum of the amount of approved claims to be

paid in the next fiscal year under section 704 of the

Taxpayer Relief Act and section 1621(a)(2)(ii), if any.

(5) Beginning in fiscal year 2009-2010 and until the

difference between the sum of subparagraphs (i) and (ii) and

$200,000,000 is paid, an amount of not less than $40,000,000

annually or the amount of the difference, whichever is less.

All transfers under this paragraph shall be completed no

later than four years after the transfer required by

paragraph (2).

(i) The difference between the sum of the amount of

approved claims to be paid in fiscal year 2007-2008 under

section 1621(a)(2)(i) and (3) and the amount of approved

claims paid in fiscal year 2006-2007 under section

1621(a)(1).

(ii) The difference between the sum of the amount of

approved claims to be paid in fiscal year 2008-2009 under

section 1621(a)(2)(i) and (3) and the amount of approved

claims paid in fiscal year 2006-2007 under section

1621(a)(1).

provision of law, The Secretary of the Budget shall transfer all

money from the Senior Citizen Property Tax Rebate Fund to the

State Lottery Fund.

Section 1626. Claim forms and rules and regulations.

(a) General rule.--Necessary rules and regulations shall be

prescribed by a committee consisting of the Secretary of Aging,

the Secretary of Revenue and the Secretary of Community and

Economic Development. The Secretary of Aging shall serve as the

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chairman of the committee. The department shall receive all

applications, determine the eligibility of claimants, hear

appeals, disburse payments and make available suitable forms for

the filing of claims.

(b) Report to General Assembly.--In addition to any rules

and regulations prescribed under subsection (a), the department

shall collect the following information and issue a report

including such information to the chairman and minority chairman

of the Appropriations Committee of the Senate and the chairman

and minority chairman of the Appropriations Committee of the

House of Representatives by September 30, 2006, and September 30

of each year thereafter.

(1) The total number of claims which will be paid in the

fiscal year in which the report is issued with the

information provided by school district, by county and for

each household income level under section 1621(a)(2)(i).

(2) The total amount of rebates paid in the fiscal year

in which the report is issued with the information provided

by school district, by county and for each household income

level under section 1621(a)(2)(i).

Section 1627. Fraudulent claims and conveyances to obtain

benefits.

(a) Civil penalty.--In any case in which a claim is

excessive and was filed with fraudulent intent, the claim shall

be disallowed in full, and a penalty of 25% of the amount

claimed shall be imposed. The penalty and the amount of the

disallowed claim, if the claim has been paid, shall bear

interest at the rate of 1.5% per month from the date of the

claim until repaid.

(b) Criminal penalty.--The claimant and any person who

assisted in the preparation or filing of a fraudulent claim

commits a misdemeanor of the third degree and, upon conviction,

shall be sentenced to pay a fine of not more than $1,000 or to

imprisonment for not more than one year, or both.

disallowed if the claimant received title to the homestead

primarily for the purpose of receiving property tax rebate.

Section 1628. Petition for redetermination.

(a) Right to file.--A claimant whose claim is denied,

corrected or otherwise adversely affected by the department may

file with the department a petition for redetermination on forms

supplied by the department within 90 days after the date of

mailing of written notice by the department of such action.

(b) Contents.--The petition shall set forth the grounds upon

which the claimant alleges that such departmental action is

erroneous or unlawful, in whole or part, and shall contain an

affidavit or affirmation that the facts contained in the

petition are true and correct.

(1) An extension of time for filing the petition may be

allowed for cause but may not exceed 120 days.

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(2) The department shall hold such hearings as may be

necessary for the purpose of redetermination, and each

claimant who has duly filed such petition for redetermination

shall be notified by the department of the time when and the

place where such hearing in the claimant's case will be held.

(d) Time period for decision.--The department shall, within

six months after receiving a filed petition for redetermination,

dispose of the matters raised by such petition and shall mail

notice of the department's decision to the claimant.

Section 1629. Review by Board of Finance and Revenue.

(a) Right to review.--Within 90 days after the date of

official receipt by the claimant of notice mailed by the

department of its decision on a petition for redetermination

filed with it, the claimant who is adversely affected by the

decision may by petition request the board to review such

action.

(b) Effect of no decision from department.--The failure of

the department to officially notify the claimant of a decision

within the six-month period provided for by section 1628 shall

act as a denial of the petition, and a petition for review may

be filed with the board within 120 days after written notice is

officially received by the claimant that the department has

failed to dispose of the petition within the six-month period.

for redetermination filed shall state the reasons upon which the

claimant relies or shall incorporate by reference the petition

for redetermination in which such reasons were stated. The

petition shall be supported by affidavit that the facts set

forth therein are correct and true.

(d) Time period for decision.--The board shall act in

disposition of petitions filed with it within six months after

they have been received, and, in the event of failure of the

board to dispose of any petition within six months, the action

taken by the department upon the petition for redetermination

shall be deemed sustained.

(e) Relief authorized by board.--The board may sustain the

action taken by the department on the petition for

redetermination or it may take such other action as it shall

deem necessary and consistent with provisions of this part.

(f) Form of notice.--Notice of the action of the board shall

be given by mail to the department and to the claimant.

Section 1630. Appeal.

A claimant aggrieved by a decision of the board may appeal

from the decision of the board in the manner provided by law for

appeals from decisions of the board in tax cases.

PART IV

Miscellaneous Provisions

Section 1631. Additional provisions.

Any reference to Chapter 13 of the Taxpayer Relief Act shall

be deemed a reference to Part III of Article XVI of this act.

Section 3. Repeals are as follows:

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(1) The General Assembly declares that the repeal under

paragraph (2) is necessary to effectuate the addition of

Article XVI of the act.

(2) Chapter 13 of the Taxpayer Relief Act.

Section 4. The addition of Part III of Article XVI of the

act is a continuation of Chapter 13 of the Taxpayer Relief Act.

Except as otherwise provided in Part III of Article XVI of the

act, all activities initiated under Chapter 13 of the Taxpayer

Relief Act shall continue and remain in full force and effect

and may be completed under Part III of Article XVI of the act.

Orders, regulations, rules and decisions which were made under

Chapter 13 of the Taxpayer Relief Act and which are in effect on

the effective date of this section shall remain in full force

and effect until revoked, vacated or modified under Part III of

Article XVI of the act. Contracts, obligations and collective

bargaining agreements entered into under Chapter 13 of the

Taxpayer Relief Act are not affected nor impaired by the repeal

of Chapter 13 of the Taxpayer Relief Act.

Section 5. This act shall take effect as follows:

(1) The amendment of section 201(k)(8) and (o)(4)(B) of

the act shall take effect in 60 days.

(2) The remainder of this act shall take effect

immediately.

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