PRINTER'S NO. 2657
No. 2015 Session of 2003
INTRODUCED BY MAHER, DeLUCA, GERGELY, HABAY, MARKOSEK, MUSTIO
AND TURZAI, SEPTEMBER 29, 2003
REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, SEPTEMBER 29, 2003
AN ACT
1 Amending the act of July 10, 1987 (P.L.246, No.47), entitled "An
2 act empowering the Department of Community Affairs to declare
3 certain municipalities as financially distressed; providing
4 for the restructuring of debt of financially distressed
5 municipalities; limiting the ability of financially
6 distressed municipalities to obtain government funding;
7 authorizing municipalities to participate in Federal debt
8 adjustment actions and bankruptcy actions under certain
9 circumstances; and providing for consolidation or merger of
10 contiguous municipalities to relieve financial distress,"
11 further providing for the right of a municipality to petition
12 the court for an increase in the rate of taxation.
13 The General Assembly of the Commonwealth of Pennsylvania
14 hereby enacts as follows:
15 Section 1. Section 123(c) of the act of July 10, 1987
16 (P.L.246, No.47), known as the Municipalities Financial Recovery
17 Act, amended July 11, 1996 (P.L.645, No.108), is amended to
18 read:
19 Section 123. Powers and duties of municipalities.
20 * * *
21 (c) Right to petition court for tax increase.--
22 (1) After a municipality has adopted a plan under
23 Subchapter C of Chapter 2, it may petition the court of
1 common pleas of the county in which the municipality is
2 located to increase its rates of taxation for earned income,
3 real property, or both, beyond maximum rates provided by law.
4 (2) If a tax increase above existing limits is granted
5 by the courts, the increase shall be effective for a period
6 of one year. The one-year increase shall run from the date
7 specified in the petition filed with the court or, if no such
8 date is specified, from the beginning of the current fiscal
9 year of the municipality. Subsequent increases in rates of
10 taxation may be granted by the court upon annual petition of
11 the municipality. The additional amount of taxes resulting
12 from the petition shall not be subject to sharing with a
13 school district.
14 (3) A petition filed by a city of the second class or
15 second class A under this subsection may not include an
16 increase in a tax on nonresident income unless the
17 municipality certifies to the court, with regard to those
18 provisions of the plan having a measurable fiscal impact,
19 that:
20 (i) the municipality has substantially implemented
21 the provisions which are within the authority of the
22 chief executive officer or governing body, including, but
23 not limited to, provisions of the plan that call for
24 increasing existing tax rates levied on residents and
25 increasing fees charged by the municipality;
26 (ii) the municipality has taken those actions
27 required to obtain the approval of other parties for
28 those provisions which may not be implemented without
29 such approval, including, but not limited to, the
30 approval of a court, local electors or any collective
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1 bargaining unit; and
2 (iii) the additional income from the aforementioned
3 actions is insufficient to balance the municipal budget,
4 necessitating additional revenue from an increase in the
5 tax on nonresident income.
6 Section 2. This act shall take effect in 60 days.
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