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                                                       PRINTER'S NO. 346

THE GENERAL ASSEMBLY OF PENNSYLVANIA


HOUSE BILL

No. 300 Session of 2003


        INTRODUCED BY DIVEN, FEBRUARY 18, 2003

        REFERRED TO COMMITTEE ON URBAN AFFAIRS, FEBRUARY 18, 2003

                                     AN ACT

     1  Providing for the remediation of blighted properties in cities
     2     of the first and second class.

     3     The General Assembly of the Commonwealth of Pennsylvania
     4  hereby enacts as follows:
     5  Section 1.  Short title.
     6     This act shall be known and may be cited as the Blight
     7  Remediation Board Act.
     8  Section 2.  Legislative intent.
     9     The purpose of this act is to establish a blight remediation
    10  program that would provide affordable housing, improve the
    11  quality of life in urban neighborhoods and increase annual
    12  reoccurring revenue for school districts and cities of the first
    13  and second class without the commitment of future State tax
    14  dollars.
    15  Section 3.  Definitions.
    16     The following words and phrases when used in this act shall
    17  have the meanings given to them in this section unless the


     1  context clearly indicates otherwise:
     2     "Blighted property."  Includes any of the following:
     3         (1)  Any premises which, because of physical condition or
     4     use, is regarded as a public nuisance at common law or has
     5     been declared a public nuisance in accordance with the local
     6     housing, building, plumbing, fire and related codes.
     7         (2)  Any dwelling which, because it is dilapidated,
     8     unsanitary, unsafe, vermin-infested or lacking in the
     9     facilities and equipment required by the housing code of the
    10     municipality, has been designated by the local agency
    11     responsible for enforcement of the code as unfit for human
    12     habitation.
    13         (3)  Any structure which is a fire hazard or is otherwise
    14     dangerous to the safety of persons or property.
    15         (4)  Any structure from which the utilities, plumbing,
    16     heating, sewerage or other facilities have been disconnected,
    17     destroyed, removed or rendered ineffective so that the
    18     property is unfit for its intended use.
    19         (5)  Any vacant or unimproved lot or parcel of ground in
    20     a predominantly built-up neighborhood which by reason of
    21     neglect or lack of maintenance has become a place for
    22     accumulation of trash and debris or a haven for rodents or
    23     other vermin.
    24         (6)  Any property which has been tax delinquent for a
    25     period of two years.
    26     "Board."  The Blight Remediation Board established by this
    27  act.
    28     "Department."  The Department of Community and Economic
    29  Development of the Commonwealth.
    30     "Fund."  The Blight Remediation Fund established by this act.
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     1     "Program."  The Blight Remediation Program established by
     2  this act.
     3  Section 4.  Program.
     4     (a)  Establishment.--The Blight Remediation Program is hereby
     5  established within the department.
     6     (b)  Transfer of capital budget moneys.--Immediately
     7  following the deposit of capital budget moneys into the fund
     8  pursuant to section 8, $75,000,000 of the moneys shall be
     9  transferred to the city of the first class and $35,000,000 of
    10  the moneys shall be transferred to the city of the second class
    11  for expenditure pursuant to the purposes set forth in subsection
    12  (c).
    13     (c)  Use of transferred moneys.--The city of the first class
    14  and the city of the second class shall utilize the transferred
    15  moneys to purchase blighted property within their respective
    16  jurisdictions for inclusion in the program. Purchase may be
    17  effected by outright purchase, eminent domain, purchase at tax
    18  sale or by any other means available. Moneys may be utilized to
    19  defray all costs and expenses associated with obtaining good
    20  marketable title to the blighted properties, including, but not
    21  limited to, the satisfaction of liens and other claims, attorney
    22  fees and all other costs incurred to acquire such properties.
    23     (d)  Conveyance of purchased property to department.--Within
    24  nine months of the effective date of this act, the city of the
    25  first class and the city of the second class shall each submit a
    26  list of properties acquired pursuant to subsection (c) to the
    27  board. Such list shall also include information specifying the
    28  amount expended to purchase and clear title to each property,
    29  the exact location of each property and such other information
    30  deemed warranted by the board. Following board review of these
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     1  lists and the accompanying information pursuant to section 6,
     2  all properties on the list that have been approved by the board
     3  for program inclusion shall be conveyed by each city in fee
     4  simple to the Commonwealth.
     5     (e)  Development of conveyed property.--Capital budget moneys
     6  in the amount of $25,000,000 with respect to the city of the
     7  first class and $15,000,000 with respect to the city of the
     8  second class shall be utilized by the board in site preparation
     9  of the conveyed properties. These moneys may be used to cover
    10  costs in razing and clearing dilapidated buildings and in the
    11  installation of necessary infrastructure, including sewer, water
    12  and other utilities.
    13     (f)  Tax abatement programs.--Properties qualifying for this
    14  program are not eligible for any tax abatement program.
    15  Section 5.  Board.
    16     (a)  Establishment.--The Blight Remediation Board is hereby
    17  established with the department and shall administer the
    18  program.
    19     (b)  Composition.--The board shall be composed of a governing
    20  board composed of three members appointed by the Governor; one
    21  shall have expertise in the area of real estate appraisal and
    22  finance, one shall have expertise in the area of urban
    23  redevelopment and economic development, and one shall have
    24  expertise in general business practices and marketing.
    25     (c)  Term; vacancies.--The term of a board member shall begin
    26  on the date of appointment. A member's term shall be coterminous
    27  with that of his or her appointing authority, provided that the
    28  member's term shall continue until his or her replacement is
    29  appointed. Board members shall serve at the pleasure of the
    30  appointing authority. Whenever a vacancy occurs on the board,
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     1  whether prior to or on the expiration of a term, the appointing
     2  authority who originally appointed the board member whose seat
     3  has become vacant shall appoint a successor member within 30
     4  days of the vacancy. A member appointed to fill a vacancy
     5  occurring prior to the expiration of a term shall serve the
     6  unexpired term.
     7     (d)  Meetings.--The board shall meet as frequently as it
     8  deems appropriate but at least once during each quarter of the
     9  fiscal year. In addition, a meeting of the board shall be called
    10  by the chairperson if a request for a meeting is submitted to
    11  the chairperson by at least two members of the board. A majority
    12  of the board shall constitute a quorum for the purpose of
    13  conducting the business of the board and for all other purposes.
    14  All actions of the board shall be taken by a majority of the
    15  board unless specific provisions of this act require that action
    16  be taken by a qualified majority. The provisions of 65 Pa.C.S.
    17  Ch. 7 (relating to open meetings) shall apply to the board.
    18     (e)  Expenses.--A member shall not receive compensation or
    19  remuneration, but shall be entitled to reimbursement for all
    20  reasonable and necessary actual expenses.
    21     (f)  Public officials and party officers.--Members of the
    22  board shall not seek or hold a position as any other public
    23  official within this Commonwealth or as a party officer while in
    24  service. Members of the board shall not seek election as public
    25  officials or party officers for one year after their service on
    26  the board. Members of the board may serve as appointive public
    27  officials any time after their periods of service on the board.
    28  Section 6.  Powers and duties of board.
    29     (a)  Review of property lists.--Upon receipt of the lists of
    30  blighted properties purchased by the first and second class
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     1  cities pursuant to section 4(d), the board shall review the
     2  lists to ascertain that each property is in a position to be
     3  conveyed to the Commonwealth with a good marketable title and
     4  free of all liens and claims. No property shall be approved for
     5  conveyance and program inclusion if it is determined that there
     6  exists a title problem of any sort or any environmental or other
     7  type of site problem that carries the potential for owner
     8  liability. The Commonwealth shall be held harmless for any title
     9  problem or environmental problem. These are the sole
    10  responsibility of the city.
    11     (b)  Acceptance of conveyed property.--Once the board has
    12  conducted the review prescribed in subsection (a), it shall
    13  notify each city of the properties the board will accept for
    14  program inclusion. The conveyance from the cities shall then
    15  occur.
    16     (c)  Agreement.--At the time of conveyance, each city and the
    17  board shall execute a separate agreement that sets forth the
    18  responsibilities and duties of each party under the program. In
    19  such agreements, the board shall obligate itself to undertake
    20  site demolition and clearing work and the installation of
    21  necessary infrastructure and to ultimately convey the property
    22  to other entities, including private developers, for
    23  development. Each city, county and school district shall agree
    24  to repay the capital budget moneys forwarded pursuant to this
    25  program by dedicating 50% of the amount of city, county and
    26  school district real estate taxes levied from these properties
    27  to the repayment effort.
    28     (d)  Site development on conveyed property.--The board,
    29  utilizing $25,000,000 in capital budget moneys in the case of
    30  the first class city and $15,000,000 in the case of the second
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     1  class city, shall perform the work as stated in subsection (c).
     2     (e)  Request for proposals.--Simultaneously with the
     3  undertaking of the preliminary site development called for in
     4  subsection (d), the board shall advertise for development
     5  proposals from public and private development entities,
     6  including, but not limited to, redevelopment authorities,
     7  housing authorities and private developers. The board shall
     8  promulgate regulations regarding the criteria to be used in
     9  reviewing the proposals received. The promulgation of these
    10  regulations shall not be subject to the provisions of the act of
    11  June 25, 1982 (P.L.633, No.181), known as the Regulatory Review
    12  Act.
    13     (f)  Selection of developers.--Upon review of the proposals
    14  received pursuant to subsection (e), the board is authorized to
    15  convey a property or groups of properties to a given developer
    16  for development. The conveyances shall occur for the
    17  consideration of $1 per property. Simultaneously with the
    18  conveyance, a separate agreement shall be executed in which the
    19  developer agrees to develop the property within a given period
    20  of time and pursuant to the specific development standards, all
    21  of which shall be detailed in regulations promulgated by the
    22  department. Promulgation of the regulations shall not be subject
    23  to the provisions of the Regulatory Review Act. Among other
    24  things, the regulations shall provide for reversion of title to
    25  the Commonwealth in the event the contract terms are breached by
    26  the developer.
    27  Section 7.  Fund.
    28     (a)  Establishment.--The Blight Remediation Fund is hereby
    29  established in the State Treasury. All money in the fund is
    30  hereby appropriated to the department on a continuing basis to
    20030H0300B0346                  - 7 -     

     1  carry out the provisions of this act.
     2     (b)  Administration.--The assets of the fund shall be
     3  preserved, invested and expended solely pursuant to and for the
     4  purposes set forth in this act.
     5  Section 8.  Funding.
     6     Up to $150,000,000 of the net proceeds of the sale of
     7  obligations authorized in a capital budget act for the purposes
     8  of blight remediation is hereby appropriated to the Department
     9  of Community and Economic Development for deposit into the fund
    10  established and to be used to implement the provisions of this
    11  act. To the extent moneys from this appropriation are expended
    12  pursuant to this act, the moneys shall be repaid, without
    13  interest, to the Commonwealth as soon as practicable pursuant to
    14  section 9.
    15  Section 9.  Repayment of funds.
    16     (a)  Repayment.--Each city shall be responsible for the
    17  repayment of all Commonwealth funding it received directly
    18  pursuant to section 4(b), as well as the funds expended on its
    19  behalf by the board pursuant to section 6(d), within 20 years of
    20  the calendar year in which the expenditures were made. The board
    21  shall advise each city of the year by which all repayments are
    22  to be made.
    23     (b)  Sources of repayment.--Repayment shall be made from any
    24  sources available to the respective cities, including positive
    25  city and school district real estate tax increments generated on
    26  the properties rehabilitated pursuant to the program. Each city
    27  shall determine the aggregate value of the property approved for
    28  and included in the program as of the calendar year in which
    29  funds are made available to the cities under section 4(c), which
    30  aggregate valuation shall constitute the tax increment base.
    20030H0300B0346                  - 8 -     

     1  With respect to each city, in any year in which its debt remains
     2  unpaid, at least 50% of any positive tax increment generated in
     3  that year shall be utilized to make payment toward the
     4  outstanding debt.
     5  Section 10.  Effective date.
     6     This act shall take effect immediately.
















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