THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

INTRODUCED BY MENSCH, ADOLPH, BAKER, BARRAR, BENNINGHOFF, BEYER, BOBACK, BOYD, BRENNAN, BRIGGS, CAUSER, CLYMER, CUTLER, DALLY, ELLIS, EVERETT, FAIRCHILD, FLECK, FRANKEL, GEIST, GODSHALL, GOODMAN, GROVE, GRUCELA, HARHART, HARKINS, HARPER, HARRIS, HENNESSEY, HICKERNELL, HORNAMAN, HUTCHINSON, KAUFFMAN, KESSLER, KILLION, KORTZ, LONGIETTI, MAJOR, MANN, MARSICO, McILVAINE SMITH, MELIO, MILLARD, MILLER, MURT, D. O'BRIEN, O'NEILL, PALLONE, PEIFER, PETRI, PHILLIPS, PICKETT, PYLE, QUINN, READSHAW, REED, SABATINA, SAINATO, SANTARSIERO, SCAVELLO, SEIP, SIPTROTH, SOLOBAY, STERN, SWANGER, R. TAYLOR, VEREB, VULAKOVICH, WALKO, WATSON AND YOUNGBLOOD, FEBRUARY 26, 2009

REFERRED TO COMMITTEE ON FINANCE, FEBRUARY 26, 2009  

AN ACT

Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An

act relating to tax reform and State taxation by codifying

and enumerating certain subjects of taxation and imposing

taxes thereon; providing procedures for the payment,

collection, administration and enforcement thereof; providing

for tax credits in certain cases; conferring powers and

imposing duties upon the Department of Revenue, certain

employers, fiduciaries, individuals, persons, corporations

and other entities; prescribing crimes, offenses and

penalties," in personal income tax, further providing for

classes of income.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Section 303 of the act of March 4, 1971 (P.L.6,

No.2), known as the Tax Reform Code of 1971, is amended by

adding a subsection to read:

Section 303.  Classes of Income.--* * *

(a.8)  The following shall apply:

(1)  The purchase price at retail or use of a building energy

efficiency measure by an individual purchaser for nonbusiness

use shall be deductible on the annual personal income tax

return, provided that the product has been certified as in

compliance with and qualifies as an Energy Star product pursuant

to the Environmental Protection Agency and the Department of

Energy, Energy Star Program and bears the Energy Star label. The

amount of the allowable deduction shall be ten per cent of the

aggregate purchase price at retail or use of building energy

efficiency measures in the taxable year, not to exceed one

thousand five hundred dollars ($1,500) or the amount of tax due

under this article, whichever is less. The deduction shall not

include the leasing, rental, repair or servicing of such system

or product.

(2)  This subsection shall apply to taxable years beginning

after December 31, 2008, through the first taxable year

beginning after December 31, 2010. The Department of Revenue in

conjunction with the Department of Environmental Protection

shall offer a review by December 31, 2009, of this subsection

showing the fiscal impact and offering an evaluation of the

program to the General Assembly.

(3)  The Department of Revenue shall promulgate regulations

it deems necessary to implement the provisions of this

subsection and shall cooperate with the Department of

Environmental Protection in ensuring adherence to any energy and

environmental standards or criteria associated with this

subsection.

(4)  For the purposes of this subsection, "building energy

efficiency measure" includes all of the following products:

(i)  "Air-source heat pump" meaning an air-source unitary

heat pump model consisting of one or more factory-made

assemblies that:

(A)  Include an indoor conditioning coil, compressor and

outdoor coil, a means to provide controlled temperature air

heating and cooling functions and may also perform air

circulation, air cleaning, dehumidifying or humidifying

functions.

(B)  May be a single-packaged system, where there is only one

assembly or a split system, where there are two assemblies.

(C)  Contain at a minimum an Energy Star rating of: Heating

Seasonal Performance Factor (HSPF) 7.6, Energy Efficiency Ratio

(EER) 10.5, and a Seasonal Energy Efficiency Ratio (SEER) 12 or

higher and, for a split system, may be rated at a Heating

Seasonal Performance Factor (HSPF) 8.

(ii)  "Boiler" meaning a self-contained fuel burning

appliance of less than 300,000 BTUs per hour energy input, for

supplying low pressure steam or hot water for space heating

applications, that provides hot water for domestic use and that

has an Annual Fuel Utilization Efficiency Factor (AFUE) of 85 or

higher.

(iii)  "Ceiling fan" meaning a ceiling mounted fan and light

combination.

(iv)  "Central air conditioner" meaning an air conditioning

unit intended to control air temperature in entire building.

(v)  "Dehumidifier" meaning an appliance used to remove water

vapor from the air.

(vi)  "Door" meaning a residential entry or patio door system

including the door leaf and frame, where applicable, and that is

Energy Star rated.

(vii)  "Furnace" meaning a heating unit that has as its

function the combustion of fossil fuel for space heating with

forced hot air, that includes a burner, heat exchanger, blower

and connection to a heating duct, that provides hot water for

domestic use and that, at a minimum, contains an Annual Fuel

Utilization Efficiency (AFUE) 90 or higher.

(viii)  "Geothermal heat pump" meaning equipment that uses

the thermal energy of the ground or groundwater as the heat

source and heat sink for residential space heating or cooling

functions only, or both, consisting of one or more factory-made

assemblies that:

(A)  Normally include an indoor conditioning coil with air

moving means, compressor and refrigerant to fluid a heat

exchanger.

(B)  Provide a partial or all of the domestic water heating

through the use of a desuperheater, integrated demand water

heater or a separately installed compressor that provides demand

water heating, including all equipment and connections from the

point at which the ground heat exchanger enters the house,

except for indoor equipment that was installed by someone not

representing the manufacturer or manufacturer's representative.

(C)  Contain at a minimum an Energy Star rating of: Energy

Efficiency Ratio (EER) 14.1 Coefficient of Performance (COP) 3.3

for Closed Loop Systems, Energy Efficiency Ratio (EER) 16.2

Coefficient of Performance (COP) 3.6 for Open Loop Systems and

Energy Efficiency Ratio (EER) 15 Coefficient of Performance

(COP) 3.5 for Direct Expansion Systems.

(ix)  "Insulation" meaning a material or substance with the

primary purpose of insulating, including floor, ceiling, wall or

duct insulation used to retrofit an existing residential

building.

(x)  "Programmable clock thermostat" meaning a device that

enables the user to set one or more time periods each day when a

comfort setpoint temperature is maintained, one or more time

periods each day when an energy-saving setpoint temperature is

maintained and that may be capable of controlling one or more

zones of a conditioned space.

(xi)  "Reflective roofing" meaning elastometric roof coating

applied to the roof of a residential building and used to

deflect solar radiation and aiding in reducing indoor air

temperature.

(xii)  "Room air conditioner" meaning a window-mounted air

conditioning unit that is intended to control air temperature in

one room only.

(xiii)  "Solar energy system" meaning the equipment and

requisite hardware that provide and are used for collecting,

transferring, converting, storing or using incidental solar

energy for water heating, space heating and cooling, generating

electricity or other applications that would otherwise require

the use of a conventional source of energy such as coal,

petroleum products, natural gas, manufactured gas or

electricity. Eligible solar water heating equipment must be

certified by the Solar Rating and Certification Corporation and

solar photovoltaic systems must bear a certification by the

Florida Solar Energy Center.

(xiv)  "Ventilating fan" meaning a fan used to improve

ventilation including kitchen range hoods, bathroom fans,

utility fans and in-line fans.

(xv)  "Window or skylight" meaning an entire glazed unit

designed for installation in an external wall of a residential

building to allow for views and natural daylighting and that is

Energy Star rated, regardless of whether it is fixed or

operable.

Section 2.  This act shall take effect immediately.