1Providing for the establishment of the Historic Preservation
2Incentive Grant Program for historic commercial and
3residential sites.

4The General Assembly of the Commonwealth of Pennsylvania
5hereby enacts as follows:

6Section 1.  Short title.

7This act shall be known and may be cited as the Historic
8Preservation Incentive Grant Act.

9Section 2.  Definitions.

10The following words and phrases when used in this act shall
11have the meanings given to them in this section unless the
12context clearly indicates otherwise:

13"Applicant."  A commercial applicant or a residential
14applicant.

15"Commercial applicant."  A natural person, corporation,
16foundation, organization, business trust, estate, limited
17liability company, licensed corporation, trust, partnership,

1limited liability partnership, association or any other form of
2legal business entity that owns an eligible commercial property.

3"Commission."  The Pennsylvania Historical and Museum
4Commission.

5"Department."  The Department of Community and Economic
6Development of the Commonwealth.

7"Eligible building improvements."  Exterior rehabilitation or
8restoration work performed on an eligible commercial property or
9an eligible residential property, including work involving
10windows, consistent with the Standards for Rehabilitation of the
11Secretary of the Interior.

12"Eligible commercial property."  A building used or zoned to
13be used for income-producing purposes that is listed on the
14National Register of Historic Places, is a contributing property
15in a National Register historic district or is located in a
16local government historic district. The term includes a building
17used or zoned to be used for commercial purposes that is also
18used for residential purposes. The term also includes for-sale
19condominium projects.

20"Eligible property."  An eligible commercial property or an
21eligible residential property.

22"Eligible residential property."  A single-family dwelling or
23a building that:

24(1)  is a single family dwelling used as the owner's
25principal residence or is a building that is divided into no
26more than four residential units, one of which is used as the
27owner's principal residence;

28(2)  is owned by one or more natural persons; and

29(3)  either:

30(i)  is listed on the National Register of Historic

1Places or is a contributing property in a National
2Register historic district; or

3(ii)  is located in a local government historic
4district.

5"Elm Street area."  A geographically defined portion of a
6municipality that has been designated as an Elm Street area by
7the Department of Community and Economic Development in
8accordance with the terms and conditions of the act of February 
99, 2004 (P.L.61, No.7), known as the Elm Street Program Act. The
10term includes an area that has exited the official program but
11still has a program functioning to revitalize the designated
12areas pursuant to the department's program guidelines.

13"Enterprise zone."  A geographic area designated by the
14Department of Community and Economic Development as an
15enterprise zone. The term includes an area that has exited the
16official program but still has a program functioning to
17revitalize the designated areas pursuant to the department's
18program guidelines.

19"Historic district."  A local government historic district or
20an area in this Commonwealth that has been designated as a
21historic district under the National Historic Preservation Act
22(Public Law 89-665, 80 Stat. 915).

23"Local government historic district."  A historic district
24designated by any of the following:

25(1)  Section 2 of the act of June 13, 1961 (P.L.282, 
26No.167), entitled "An act authorizing counties, cities,
27boroughs, incorporated towns and townships to create historic
28districts within their geographic boundaries; providing for
29the appointment of Boards of Historical Architectural Review;
30empowering governing bodies of political subdivisions to

1protect the distinctive historical character of these
2districts and to regulate the erection, reconstruction,
3alteration, restoration, demolition or razing of buildings
4within the historic districts."

5(2)  The Historic Preservation Ordinance, Section 14-
62007, of the Philadelphia City Code.

7(3)  Title 11 of the Pittsburgh City Code, Chapter 1,
8Section 3, as amended by City Council on July 22, 1997.

9(4)  The City of Scranton under the City of Scranton
10Commission for Architectural and Urban Design Review
11ordinance.

12"Main Street community."  A geographic area designated as a
13Main Street community by the Department of Community and
14Economic Development. The term includes an area that has exited
15the official program but still has a program functioning to
16revitalize the designated areas pursuant to the department's
17program guidelines.

18"National Register."  The National Register of Historic
19Places established under section 101 of the National Historic
20Preservation Act (Public Law 89-665, 80 Stat. 915).

21"Residential applicant."  One or more natural persons who own
22an eligible residential property.

23"Standards."  The Secretary of the Interior's Standards for
24the Treatment of Historic Properties, excluding reconstruction,
25set forth at 36 CFR 67.7 (relating to standards for
26rehabilitation).

27Section 3.  Program.

28(a)  Establishment.--There is established a program in the
29department to be known as the Historic Preservation Incentive
30Grant Program. The program shall provide grants to owners of

1eligible properties located within this Commonwealth that
2undertake eligible building improvements.

3(b)  Application.--An applicant must submit an application to
4the department requesting a grant for the reimbursement of costs
5associated with eligible building improvements to an eligible
6property owned by the applicant. The application must be
7submitted on a form developed by the department in consultation
8with the commission and must include all of the following:

9(1)  The name and address of the applicant.

10(2)  The location of the property.

11(3)  Proof of ownership of the property by the applicant.
12The applicant may satisfy this requirement by providing
13evidence satisfactory to the department that the applicant
14will own the property at some point in time following
15submission of the application and has sufficient control of
16the property at the time of submission to perform the work
17described in the application.

18(4)  A description of the property providing sufficient
19information to establish that the property meets the criteria
20for either an eligible commercial property or an eligible
21residential property, including information specified in the
22commission's guidelines.

23(5)  A detailed description of the proposed work to be
24performed, including plans, drawings and specifications as
25appropriate.

26(6)  A detailed estimate of the cost of the work to be
27performed.

28(7)  Proof that the applicant is current with respect to
29the payment of all real estate taxes assessed against the
30property or evidence that the applicant is contesting the

1taxes in good faith and has set aside sums to cover any tax
2liability in the event the contest fails.

3(8)  Evidence of the source of matching funds to be
4utilized for the project. If the source of matching funds is
5a loan from a financial institution, the applicant must
6provide a copy of the loan application and commitment or
7other evidence satisfactory to the department of the
8applicant's ability to obtain the necessary financing.

9(9)  Any other information required by the department or
10the commission.

11(c)  Review and recommendation by commission.--The department
12shall forward the application to the commission for review. If
13the commission determines that the property qualifies as an
14eligible property and that the proposed improvements would
15qualify as eligible building improvements, then the commission
16may recommend approval of the property for the program and shall
17notify the department of its recommendation within 45 days
18following receipt of a completed application by the commission.

19(d)  Award of grant by department.--Upon receipt of the
20commission's recommendation for approval as provided in
21subsection (c), the department may award the applicant a grant
22and shall notify the applicant and the commission of its action.

23(e)  Certification and disbursement.--Following completion of
24the work, the applicant must file a certification with the
25commission stating that the work has been completed. The
26certification must be accompanied by photographs showing the
27completed project, evidence of the actual expenditures made by
28the applicant and evidence, in the form of a letter or letters
29from local code enforcement officials, that the property, as
30improved, complies with all local building, fire, safety and

1health codes. The commission shall complete its review of the
2certification within 90 days of receipt of the certification by
3the commission. The commission may request additional
4information and conduct a site inspection as it deems necessary
5to determine compliance with the requirements of the program
6established by this act. If the commission is satisfied with the
7certification submitted, it shall notify the department of the
8approved eligible building improvements. The department shall
9calculate the amount of the grant and disburse the grant funds
10to the applicant.

11(f)  Agreement.--The department is not required to enter into
12a grant agreement with the applicant prior to awarding and
13disbursing a grant.

14(g)  Special rules relating to eligible residential
15properties.--An application for a grant for eligible building
16improvements for an eligible residential property must include
17one of the following statements from the applicant:

18(1)  That the applicant has owned the eligible
19residential property for at least five years prior to the
20date of submission of the application.

21(2)  That the applicant has owned the eligible
22residential property for less than five years prior to the
23date of submission of the application but agrees to continue
24to own the property for a total of at least five years.

25Section 4.  Exemption from State taxes.

26Grant amounts awarded by the department for eligible
27residential properties shall not be considered income to the
28applicant under section 303 of the act of March 4, 1971 (P.L.6, 
29No.2), known as the Tax Reform Code of 1971.

30Section 5.  Allocation of grant funds; limitations; priorities.

1(a)  Source.--Funds for this program shall be provided to the
2department from funds authorized for this purpose.

3(b)  Proration.--If the total amount of grants to be awarded
4exceeds the amount of funds available for the program in any
5year, the amount of grants may be prorated among the successful
6applicants.

7(c)  Minimum.--At least 31% of the funds available in any
8year shall be reserved by the department for grants to
9successful residential applicants. If reserved funds are more
10than are needed to satisfy the total amount of those grants
11awarded in any year, the department may utilize the excess funds
12for grants to successful commercial applicants.

13(d)  Limitations.--

14(1)  Subject to the other limitations set forth in this
15subsection, a grant awarded to a successful applicant shall
16not be more than 70% of the total amount of expenditures made
17for eligible building improvements.

18(2)  In no event shall any grant be awarded unless:

19(i)  the applicant is current with respect to all
20local real estate taxes assessed against the applicant's
21eligible property; or

22(ii)  the applicant, in good faith, is contesting
23local real estate taxes assessed against the applicant's
24eligible property, provides the department with evidence
25of the contest and has set aside sums to cover any tax
26liability in the event the contest fails.

27(3)  Up to $15,000 may be awarded to a residential
28applicant in connection with a single project and up to
29$500,000 may be awarded to a commercial applicant in
30connection with a single project.

1(4)  In order to receive money from a grant, the
2applicant must complete the project being funded by the grant
3within two years of receipt of notification from the
4department of the award.

5(e)  Priorities.--Priority may be given to properties located
6in Elm Street areas, Main Street communities, enterprise zones
7and local government historic districts. In addition, the
8department shall take into account geographical distribution of
9grants in making awards.

10Section 6.  Administration.

11(a)  Guidelines.--The department and the commission shall
12develop guidelines for the implementation of the program
13established by this act.

14(b)  Expenditures.--The department may utilize up to an
15aggregate of 3% of the funds available for the program annually,
16not to exceed $500,000, as allocated by the Governor, for
17expenses incurred in administering the program established by
18this act. The department and the commission shall enter into an
19agreement for the payment to the commission of a portion of sums
20for expenses incurred by the commission.

21Section 7.  Repayment.

22The department, at its discretion, shall be entitled to a
23return of all grant funds paid to the applicant if, within five
24years following completion of the project, either of the
25following occur:

26(1)  The owner of the eligible property makes
27improvements to the exterior of the property that do not meet
28the standards.

29(2)  The eligible property is removed from the National
30Register, either individually or as a contributing building

1within a historic district, whether or not as a result of the
2owner making improvements to the exterior of the property
3that do not meet the standards.

4(3)  The eligible residential property is transferred in
5violation of the agreement made by the owner under the
6provisions of section 3(g)(2), if applicable, unless the
7transfer occurs as a result of the death of the owner or is
8otherwise involuntary.

9Section 20.  Effective date.

10This act shall take effect in 120 days.