PRIOR PRINTER'S NO. 1563 PRINTER'S NO. 2557
No. 1311 Session of 1983
INTRODUCED BY MURPHY, D. R. WRIGHT, TRELLO, ITKIN, SEVENTY, F.
E. TAYLOR, WAMBACH, O'DONNELL, FEE, FREEMAN, KUKOVICH,
MANDERINO, OLASZ, CAWLEY, DeWEESE, TIGUE, RUDY, LLOYD,
GRUITZA, AFFLERBACH, McHALE, STEIGHNER, HALUSKA, ZWIKL,
WOZNIAK, FATTAH, CLARK, VAN HORNE, McMONAGLE, COY, GAMBLE,
DALEY, COLAFELLA, RICHARDSON, EVANS, COHEN, DEAL, STEWART,
MAYERNIK, PISTELLA, MISCEVICH, HARPER, SWEET, WACHOB,
MICHLOVIC, CALTAGIRONE, LEVIN, LINTON AND PRESTON, JUNE 29,
1983
AS REPORTED FROM COMMITTEE ON FINANCE, HOUSE OF REPRESENTATIVES,
AS AMENDED, FEBRUARY 15, 1984
AN ACT
1 To establish a State-run grant program which would provide <--
2 infrastructure support moneys to complement new private
3 investment projects; AND MAKING AN APPROPRIATION. <--
4 The General Assembly of the Commonwealth of Pennsylvania
5 hereby enacts as follows:
6 Section 1. Short title.
7 This act shall be known and may be cited as the Pennsylvania
8 Development Investment Program Act.
9 Section 2. Definitions.
10 The following words and phrases when used in this act shall
11 have the meanings given to them in this section unless the
12 context clearly indicates otherwise:
13 "Infrastructure." Those improvements to real property
14 usually performed by a municipality or municipal authority or a
1 private concern which include, but are not limited to, roadways,
2 curbing, street-widening, water or sewage lines, railroad
3 sidings, utility services, drainage and other improvements
4 necessary to provide services or improve services to an
5 industrial or commercial project.
6 "Local sponsor." Any municipality or any industrial and
7 commercial authority organized pursuant to, OR INDUSTRIAL <--
8 DEVELOPMENT COMPANY AS CERTIFIED BY THE DEPARTMENT OF COMMERCE
9 PURSUANT TO, the act of August 23, 1967 (P.L.251, No.102), known
10 as the Industrial and Commercial Development Authority Law. Any
11 council of government organization or any multimunicipal agency
12 organization created pursuant to the act of July 12, 1972
13 (P.L.762, No.180), referred to as the Intergovernmental
14 Cooperation Law, any municipal authority organized pursuant to
15 the act of May 2, 1945 (P.L.382, No.164), known as the
16 Municipality Authorities Act of 1945 and any redevelopment
17 authority organized pursuant to the act of May 24, 1945
18 (P.L.991, No.385), known as the Urban Redevelopment Law.
19 "Municipality." Any county, city, borough, incorporated
20 town, township or home rule municipality.
21 "Pennsylvania Economic Development Board." The Pennsylvania <--
22 Economic Development Board as established by the act of
23 .
24 "PennPRIDE." The Pennsylvania Program for Recovery,
25 Investment, Development and Education.
26 "PRIVATE COMPANY." ANY CORPORATION, PARTNERSHIP OR <--
27 ASSOCIATION AS WELL AS A NATURAL PERSON.
28 Section 3. Establishment of program.
29 (a) General purpose.--There is hereby established under the
30 direction of Pennsylvania Economic Development Board THE <--
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1 DEPARTMENT OF COMMERCE a program to be known as the Pennsylvania
2 Development Investment Program AND DEVELOPMENT FUND for the <--
3 purpose of making grants or loans of moneys to local sponsors in <--
4 order to develop or install specific infrastructure necessary to
5 complement or encourage new or expanded industrial or commercial
6 investment by private companies.
7 (b) Private company initiatives commitments.--An application
8 for a loan or grant shall be initiated by a private company by a <--
9 request to a local sponsor, as defined in this act, and such
10 local sponsor shall proceed only upon the basis of a contractual
11 agreement or signed letter of intent by the private company that
12 it will locate, build or expand an industrial or commercial
13 venture within this Commonwealth in the jurisdiction of the
14 local sponsor if the specific infrastructure which is being
15 sought is provided. THE AMOUNT OF STATE FUNDS COMMITTED TO ONE <--
16 DEVELOPMENT WILL NOT EXCEED $1 FOR EVERY $6 OF INVESTMENT IN THE
17 CASE OF PRIVATE INVESTMENTS OR $1 FOR EVERY $3 IN THE CASE WHERE
18 A NONPROFIT ORGANIZATION IS THE INVESTOR.
19 (c) Grant and loan LOAN conditions.--The Economic <--
20 Development Board DEPARTMENT OF COMMERCE shall consider grant <--
21 and loan applications from local sponsors based upon the
22 criteria to encourage certain kinds of economic development by
23 certain types of commercial and industrial firms as set forth in
24 the economic development strategy as developed and required by
25 the Pennsylvania Economic Development Board DEPARTMENT OF <--
26 COMMERCE, and shall determine whether the benefits to be derived
27 from a proposed infrastructure grant or loan are worth the <--
28 investment based on the following criteria:
29 (1) The number of new jobs that will be provided
30 directly by the private company's new or expanded industrial
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1 or commercial investment.
2 (2) The amount of additional income that will be
3 directly and indirectly generated by the private company's
4 new or expanded industrial or commercial investment.
5 (3) The availability or lack thereof of Federal
6 Government Urban Development Action Grants or other Federal
7 assistance that would fund development of the infrastructure.
8 (4) The degree of economic distress in the jurisdiction
9 of the local sponsor and, when appropriate, the surrounding
10 area, as measured by rates of unemployment, income levels,
11 and such other criteria as the Economic Development Board <--
12 DEPARTMENT OF COMMERCE shall establish by rules or <--
13 guidelines.
14 (5) The amount of expansion in the local tax base that
15 will be generated by the proposed new or expanded investment
16 by the private company.
17 (6) WHILE NOT EXCLUDING OTHER TYPES OF DEVELOPMENT, A <--
18 HIGH PREFERENCE SHALL BE GIVEN TO MANUFACTURING.
19 (7) NO MORE THAN 10% OF THE FUNDS APPROPRIATED IN
20 SECTION 5 SHALL BE LOANED TO LOCAL SPONSORS IN A PARTICULAR
21 MUNICIPALITY UNLESS NO OTHER APPLICATIONS FOR LOANS PURSUANT
22 TO THIS ACT ARE PENDING AND FUNDS ARE AVAILABLE TO BE LOANED.
23 (D) LOAN REPAYMENT.--THE DEPARTMENT OF COMMERCE WILL
24 ESTABLISH REGULATIONS FOR THE REPAYMENT OF FUNDS LOANED FROM THE
25 DEVELOPMENT FUND. THE PROVISIONS WILL INCLUDE, BUT NOT BE
26 LIMITED TO:
27 (1) FUNDS MAY BE LENT FOR A MAXIMUM OF 40 YEARS OR THE
28 ESTIMATED USEFUL LIFE OF THE IMPROVEMENT, WHICHEVER IS LESS.
29 (2) INTEREST RATES WILL BE FLEXIBLE DEPENDING ON THE
30 PROJECT'S ABILITY TO MEET THE CRITERIA IN SUBSECTION (C) AND
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1 THE FINANCIAL STATUS OF THE DEVELOPER.
2 (3) THE DEPARTMENT OF COMMERCE WILL HAVE THE ABILITY TO
3 DEFER INTEREST AND PRINCIPAL PAYMENTS FOR A MAXIMUM OF FIVE
4 YEARS.
5 (4) INTEREST PAYMENTS MAY BE FORGIVEN TO A MAXIMUM OF
6 75% OF THE INTEREST DUE ON THE LOAN BASED ON THE FOLLOWING
7 CRITERIA:
8 (I) THE NUMBER OF JOBS CREATED.
9 (II) THE AVERAGE WAGE RATE OF THE JOBS CREATED
10 COMPARED TO THE STATE AVERAGE.
11 (III) THE PUBLIC REVENUES GENERATED DIRECTLY AND
12 INDIRECTLY THROUGH LOCAL AND STATE TAXES.
13 NO INTEREST SHALL BE FORGIVEN UNLESS, IN THE CASE OF EACH
14 LOAN, THE FORGIVENESS IS APPROVED BY A MAJORITY VOTE OF THE
15 FOLLOWING FIVE PERSONS: THE AUDITOR GENERAL, THE STATE
16 TREASURER, THE SECRETARY OF COMMERCE, THE SECRETARY OF THE
17 BUDGET AND AN AGENT OF THE MUNICIPAL GOVERNMENT IN WHICH THE
18 INFRASTRUCTURE IS LOCATED WHO IS AUTHORIZED BY LAW TO COMMIT
19 THE MUNICIPALITY TO REIMBURSE THE STATE FOR 50% OF THE AMOUNT
20 OF INTEREST FORGIVEN. INTEREST PAYMENTS SHALL NOT BE FORGIVEN
21 UNTIL THE MUNICIPALITY IN WHICH THE INFRASTRUCTURE IS LOCATED
22 HAS REIMBURSED THE STATE FOR 50% OF THE AMOUNT OF INTEREST
23 FORGIVEN.
24 Section 4. Economic Development Board DEPARTMENT <--
25 OF COMMERCE powers.
26 The Economic Development Board DEPARTMENT OF COMMERCE shall <--
27 have the power and duty to:
28 (1) Set from time to time such rates of interest and
29 repayment schedules as may be required for any loans made
30 pursuant to section 3.
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1 (2) Prescribe such applicant form and promulgate such
2 rules or guidelines as may be necessary to carry out the
3 provisions of section 3, and specifically section 3(c)(5)
4 with respect to grant and loan conditions, criteria for <--
5 evaluation of the economic benefit of proposed grants or <--
6 loans, and for determining and evaluating compliance with all
7 the other criteria established in section 3(c).
8 (3) Follow the criteria with respect to an economic
9 development strategy for the Commonwealth and the
10 encouragement of certain kinds of economic development by
11 certain types of commercial and industrial firms.
12 SECTION 5. APPROPRIATION. <--
13 THE SUM OF $60,000,000 IS APPROPRIATED TO THE DEPARTMENT OF
14 COMMERCE TO CARRY OUT THE PROVISIONS OF THIS ACT.
15 Section 5 6. Effective date. <--
16 This act shall take effect in 60 days.
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