1Amending Titles 64 (Public Authorities and Quasi-Public
2Corporations) and 72 (Taxation and Fiscal Affairs) of the
3Pennsylvania Consolidated Statutes, in Title 64, providing
4for community development authorities; and, in Title 72,
5providing for microenterprise assistance.

6The General Assembly of the Commonwealth of Pennsylvania
7hereby enacts as follows:

8Section 1. Title 64 of the Pennsylvania Consolidated
9Statutes is amended by adding a chapter to read:

10CHAPTER 17

11COMMUNITY DEVELOPMENT AUTHORITIES

12Sec.

131701. Scope of chapter.

141702. Legislative findings and purpose.

151703. Definitions.

161704. Creation and existence.

171705. Board.

181706. Staff.

11707. Powers.

21708. Eminent domain.

31709. Acquisition of property.

41710. Disposition of property.

51711. Financing of authority operations.

61712. Fund.

71713. Borrowing and issuance of bonds.

81714. Public records and public access.

91715. Merger.

101716. Dissolution of authority.

111717. Conflicts of interest.

121718. Construction, intent and scope.

131719. Annual audit and report.

141720. Collaboration of community development financial
15institutions with authorities.

161721. Cost sharing.

17§ 1701. Scope of chapter.

18This chapter relates to community development authorities.

19§ 1702. Legislative findings and purpose.

20The General Assembly finds and declares that:

21(1) Strong communities are important to the social and
22economic vitality of this Commonwealth. Whether urban,
23suburban or rural, many communities are struggling to cope
24with vacant, abandoned and tax-delinquent properties.

25(2) Citizens of this Commonwealth are affected adversely
26by vacant, abandoned and tax-delinquent properties, including
27properties which have been vacated or abandoned due to
28mortgage foreclosure.

29(3) Vacant, abandoned and tax-delinquent properties
30impose significant costs on neighborhoods, communities and

1municipalities by lowering property values, increasing fire
2and police protection costs, decreasing tax revenues and
3undermining community cohesion.

4(4) There is an overriding public need to confront the
5problems caused by vacant, abandoned and tax-delinquent
6properties through the creation of new tools to enable
7municipalities to turn vacant, abandoned and tax-delinquent
8spaces into vibrant places.

9(5) Community development authorities are one of the
10tools that municipalities may use to facilitate the return of
11vacant, abandoned and tax-delinquent properties to productive
12use.

13(6) One tool available to community development
14authorities is leasing to microenterprises. Microenterprises
15are part of the small business engine that forms the backbone
16of our national and State economies.

<-17(7) Community Development Authorities, by considering
18current land use plans, can serve to help communities grow
19and prosper through targeted enterprises around existing or
20proposed methods of transportation.

<-21(7) (8) By providing support for microenterprises, a
22powerful mechanism for job creation is strengthened and a
23viable tool is made available to revitalize struggling
24neighborhoods and improve the standard of living for
25impoverished citizens of this Commonwealth. The support of
26microenterprises will provide those in poverty an opportunity
27for an improved and more prosperous lifestyle while
28decreasing the number of individuals receiving public
29assistance.

30§ 1703. Definitions.

1The following words and phrases when used in this chapter
2shall have the meanings given to them in this section unless the
3context clearly indicates otherwise:

4"Area loan organization." A local development district or
5any other nonprofit economic development organization certified
6by the department as possessing the qualifications necessary to
7evaluate and administer loans made under this chapter.

8"Authority." A community development authority.

9"Board." The board of directors of a community development
10authority.

11"City." A city of the first class, second class, second
12class A or third class.

13"Community development authority." A public body and a body
14corporate and politic established under section 1704 (relating
15to creation and existence).

16"Community development authority jurisdiction." Any of the
17following:

18(1) A municipality with a population of more than
1910,000.

20(2) Two or more municipalities comprising an area with a
21population of more than 10,000 that is geographically
22contiguous and located in the same county, if the
23municipalities enter into an intergovernmental cooperation
24agreement to establish and maintain a community development
25authority.

26"Community development financial institution." A community
27development financial institution certified in accordance with
28the Community Development Banking and Financial Institutions Act
29of 1994 (Public Law 103-325, 108 Stat. 2163).

30"Department." The Department of Community and Economic

1Development of the Commonwealth.

2"Financial institution." A bank, savings association,
3operating subsidiary of a bank or savings association, community
4development financial institution, credit union, association
5licensed to originate mortgage loans or an assignee of a
6mortgage or note originated by such an institution.

7"Fund." The Community Small Business Development Fund
8established in section 1712 (relating to fund).

9"Fund board." The board of directors of the Community Small
10Business Development Fund.

11"Low income." A household with total income at or below 80%
12of the area median income, adjusted for household size, as
13defined annually by the United States Department of Housing and
14Urban Development.

15"Microenterprise." A business operated by a sole proprietor
16or limited liability company that employs one to five employees
17and has the qualifying amount of capital provided under the
18Small Business Jobs Act of 2010 (Public Law 111-240, 124 Stat.
192504).

20"Municipality." A <-county, city, borough, incorporated town,
21township or home rule municipality.

22"Owner-occupant." A natural person with a legal or equitable
23ownership interest in property which was the primary residence
24of the person for at least three consecutive months at any point
25in the year preceding the date of initial delinquency.

26"Partnership." A partnership between a commercial or
27nonprofit entity and an authority for the training of start-up
28entrepreneurs. The term includes a partnership between an
29authority and a nonprofit, commercial or religious entity the
30sole purpose of which is to use the building space of the entity

1for the training of start-up entrepreneurs.

2"Political subdivision." Any county, city, borough,
3incorporated town, township, school district, vocational school
4district and county institution district.

5"Real property." Land and all structures and fixtures
6thereon and all estates and interests in land, including
7easements, covenants and leaseholders.

8"School district." Any of the classifications of school
9districts specified in section 202 of the act of March 10, 1949
10(P.L.30, No.14), known as the Public School Code of 1949. The
11term includes, as to any real property acquired, owned or
12conveyed by an authority, the school district within whose
13geographical jurisdiction the real property is located.

14"Secretary." The Secretary of Community and Economic
15Development of the Commonwealth.

16"Start-up entrepreneur." An individual who establishes a
17microenterprise.

18§ 1704. Creation and existence.

19(a) Authority.--A community development authority
20jurisdiction may elect to create an authority by the adoption of
21an ordinance to create a binding legal obligation. The ordinance
22must specify the following:

23(1) The number of members of the board.

24(2) The names of individuals to serve as initial members
25of the board and the length of terms which they will serve.

26(3) The qualifications, manner of selection or
27appointment and terms of office of members of the board.

28(4) The manner by which residents will be provided an
29opportunity to have input into the authority decision-making
30process.

1(5) Additional terms and conditions the community
2development authority jurisdiction deems reasonable and
3necessary for operation of the authority.

4(b) Filing.--The governing body of the community development
5authority jurisdiction which creates an authority shall file a
6copy of the ordinance with the department and with the
7Department of State. After receipt of the ordinance, the
8Secretary of the Commonwealth shall issue a certificate of
9incorporation.

10(c) Combinations.--

11(1) The authority under subsection (a) may be exercised
12in combination pursuant to an intergovernmental cooperation
13agreement by:

14(i) more than one community development authority
15jurisdiction; or

16(ii) a community development authority jurisdiction
17and one or more municipalities.

18(2) If an authority is established under paragraph (1),
19the intergovernmental cooperation agreement must specify
20matters identified in subsection (a).

21(d) Limitation.--Except as set forth in subsection (c), if a
22county establishes an authority, the authority shall have the
23power to acquire real property only in those portions of the
24county located outside of the geographical boundaries of any
25other authority established by another community development
26authority jurisdiction located partially or entirely within the
27county.

28(e) Legal status of authority.--An authority shall:

29(1) be a public body corporate and politic; and

30(2) have duration until terminated and dissolved under

1section 1716 (relating to dissolution of authority).

2(f) Collaboration.--An authority and political subdivision
3and another municipal entity may enter into an intergovernmental
4cooperation agreement relative to the operations of an
5authority.

6§ 1705. Board.

7(a) Membership.--A board shall consist of at least 11
8members. Unless restricted by the actions or agreements
9specified in section 1704 (relating to creation and existence)
10and subject to the limits stated in this section, the size of
11the board may be adjusted in accordance with bylaws of the
12authority, provided that the board consist of an odd number of
13members. The board must include an experienced loan officer and
14individuals qualified to properly administer the fund.

15(b) Eligibility to serve on board.--

16(1) Notwithstanding any law to the contrary, a public
17officer shall not be eligible to serve as a board member.

18(2) A municipal employee shall not be eligible to serve
19as a board member.

20(3) The governing body of a municipality and a school
21district which are parties to an intergovernmental
22cooperation agreement establishing an authority may nominate
23two members to the board who meet the qualifications for
24board members under this section. The following apply:

25(i) A nomination recommendation may be made to the
26governing body by a financial institution, nonprofit
27organization or other entity that represents the
28interests of the community.

29(ii) Nominations under this paragraph may only be
30made following establishment of the board and are subject

1to board approval.

2(iii) A nominee under this paragraph may not be a
3relative of a public official.

4(4) An established authority board shall include at
5least one voting member who:

6(i) is a resident of the community development
7authority jurisdiction;

8(ii) is an appointee of the chief executive officer
9of the authority's authorizing jurisdiction;

10(iii) is an appointee of the governing body of the
11authority's authorizing jurisdiction;

12(iv) is an appointee of the secretary;

13(v) is a representative of a reputable financial
14institution; and

15(vi) maintains membership with a recognized civic
16organization within the community development authority
17jurisdiction.

18(5) A member removed under subsection (d)(3) shall be
19ineligible for reappointment to the board unless the
20reappointment is confirmed unanimously by the board.

21(6) As used in this subsection, the term "public
22officer" means an individual who is elected to a municipal
23office.

24(c) Officers.--The members of the board shall select
25annually from among their members a chairperson, vice
26chairperson, secretary, treasurer and other officers as the
27board determines.

28(d) Rules.--The board shall establish rules on all of the
29following:

30(1) Duties of officers under subsection (c).

1(2) Attendance and participation of members in its
2regular and special meetings.

3(3) A procedure to remove a member by a majority vote of
4the other members for failure to comply with a rule.

5(4) Other matters necessary to govern the conduct of an
6authority.

7(e) Vacancies.--A vacancy on the board shall be filled in
8the same manner as the original appointment. Upon removal under
9subsection (d)(3), the position shall become vacant.

10(f) Compensation.--Board members shall serve without
11compensation. The board may reimburse a member for expenses
12actually incurred in the performance of duties on behalf of the
13authority.

14(g) Meetings.--

15(1) The board shall meet as follows:

16(i) In regular session according to a schedule
17adopted by the board.

18(ii) In special session:

19(A) as convened by the chairperson; or

20(B) upon written notice signed by a majority of
21the members.

22(2) A majority of the board, excluding vacancies,
23constitutes a quorum. Physical presence is required under
24this paragraph.

25(h) Voting.--

26(1) Except as set forth in paragraph (2) or (3), action
27of the board must be approved by the affirmative vote of a
28majority of the board present and voting.

29(2) Action of the board on the following matters must be
30approved by a majority of the entire board membership:

1(i) Adoption of bylaws.

2(ii) Adoption of rules under subsection (d).

3(iii) Hiring or firing of an employee or contractor
4of the authority. This function may, by majority vote of
5the entire board membership, be delegated by the board to
6a specified officer or committee of the authority.

7(iv) Incurring of debt.

8(v) Adoption or amendment of the annual budget.

9(vi) Sale, lease, encumbrance or alienation of real
10property or personal property with a value of more than
11$50,000.

12(3) A resolution under section 1716 (relating to
13dissolution of authority) must be approved by two-thirds of
14the entire board membership.

15(4) A member of the board may not vote by proxy.

16(5) A member may request a recorded vote on any
17resolution or action of the authority.

18(i) Immunity.--A community development authority
19jurisdiction which establishes an authority and a municipality
20and a school district which are parties to an intergovernmental
21cooperation agreement establishing an authority shall not be
22liable personally on the bonds or other obligations of the
23authority. Rights of creditors of an authority shall be solely
24against the authority.

25§ 1706. Staff.

26(a) Employees.--An authority may employ or enter into a
27contract for an executive director, counsel and legal staff,
28financial personnel to underwrite and manage loans issued by the
29authority, technical experts and other individuals and may
30determine the qualifications and fix the compensation and

1benefits of those employees.

2(b) Contracts.--An authority may enter into a contract with
3a municipality for:

4(1) the municipality to provide staffing services to the
5authority; or

6(2) the authority to provide staffing services to the
7municipality.

8(c) Cost.--The cost for administering an authority may not
9exceed 10% of the authority's operating budget.

10§ 1707. Powers.

11(a) General rule.--An authority constitutes a public body,
12corporate and politic, exercising public powers of the
13Commonwealth necessary or appropriate to carry out this chapter,
14including the following powers:

15(1) To adopt, amend and repeal bylaws for the regulation
16of its affairs and the conduct of its business.

17(2) To sue and be sued in its own name and be a party in
18a civil action. This paragraph includes an action to clear
19title to property of the authority.

20(3) To adopt a seal and to alter the same at pleasure.

21(4) To borrow from Federal Government funds, from the
22Commonwealth, from private lenders or from municipalities, as
23necessary, for the operation and work of the authority.

24(5) To issue negotiable revenue bonds and notes
25according to the provisions of this chapter.

26(6) To enter into contracts and other instruments
27necessary, incidental or convenient to the performance of its
28duties and the exercise of its powers. This paragraph
29includes intergovernmental cooperation agreements under 53
30Pa.C.S. Ch. 23 Subch. A (relating to intergovernmental

1cooperation) for the joint exercise of powers under this
2chapter.

3(7) To enter into contracts and intergovernmental
4cooperation agreements with municipalities for the
5performance of functions by municipalities on behalf of the
6authority or by the authority on behalf of municipalities.

7(8) To make and execute contracts and other instruments
8necessary or convenient to the exercise of the powers of the
9authority. Any contract or instrument signed shall be
10executed by and for the authority if the contract or
11instrument is signed, including an authorized facsimile
12signature, by:

13(i) the chairperson or vice chairperson of the
14authority; and

15(ii) either:

16(A) the secretary or assistant secretary of the
17authority; or

18(B) the treasurer or assistant treasurer of the
19authority.

20(9) To procure insurance against losses in connection
21with the real property, assets or activities of the
22authority.

23(10) To invest money of the authority at the discretion
24of the board in instruments, obligations, securities or
25property determined proper by the board and to name and use
26depositories for its money.

27(11) To enter into contracts for the management of, the
28collection of rent from or the sale of real property of the
29authority.

30(12) To design, develop, construct, demolish,

1reconstruct, rehabilitate, renovate, relocate and otherwise
2improve real property or rights or interests in real
3property.

4(13) To fix, charge and collect rents, fees and charges
5for the use of real property of the authority and for
6services provided by the authority.

7(14) To grant or acquire licenses, easements, leases or
8options with respect to real property of the authority.

9(15) To enter into partnerships, joint ventures and
10other collaborative relationships with municipalities and
11other public and private entities for the ownership,
12management, development and disposition of real property.

13(16) To organize and reorganize the executive,
14administrative, clerical and other departments of the
15authority and to fix the duties, powers and compensation of
16employees, agents and consultants of the authority.

17(17) To do all other things necessary or convenient to
18achieve the objectives and purposes of the authority or other
19law related to the purposes and responsibility of the
20authority.

21(b) Additional authority.--In addition to the powers granted
22to an authority under subsection (a), an authority shall have
23the following powers:

24(1) To issue loans to microenterprises that will operate
25on property owned by the authority. The loan program shall
26target microenterprises of low-income and moderate-income
27individuals.

28(2) To issue bonds for the purpose of repairing and
29improving structures owned by the authority. The bond or
30other obligation of an authority related to a bond shall not

1be a debt of a municipality or of the Commonwealth.

2(3) To negotiate for loans and grants from both public
3and private sources, provided that the Commonwealth does not
4guarantee these loans.

5(4) To make loans to low-income and moderate-income
6start-up entrepreneurs.

7§ 1708. Eminent domain.

8An authority does not possess the power of eminent domain.

9§ 1709. Acquisition of property.

10(a) Title to be held in its name.--An authority shall hold
11in its own name all real property it acquires.

12(b) Tax exemption.--

13(1) Except as set forth in paragraph (2), the real
14property of an authority and its income and operations are
15exempt from State and local tax.

16(2) Paragraph (1) does not apply to real property of an
17authority after the fifth consecutive year in which the real
18property is continuously leased to a private third party.
19However, real property shall continue to be exempt from State
20and local taxes if it is leased to a nonprofit or
21governmental agency at substantially less than fair market
22value. A nonprofit agency qualifies under this paragraph if
23it is acting within the scope and intent of this chapter to
24further the development of the community and assist in the
25creation of microenterprises.

26(c) Acquisitions from municipalities.--

27(1) An authority may acquire real property by purchase
28contracts, lease purchase agreements, installment sales
29contracts and land contracts and may accept transfers from
30municipalities upon terms and conditions as agreed to by the

1authority and the municipality.

2(2) A municipality may transfer to an authority real
3property and interests in real property of the municipality
4on terms and conditions and according to procedures
5determined by the municipality as long as the real property
6is located within the jurisdiction of the authority.

7(3) A redevelopment authority located within a community
8development authority jurisdiction established under this
9chapter may, with the consent of the local governing body and
10without a redevelopment contract, convey property which it
11acquired before the effective date of this paragraph to the
12authority. A conveyance under this paragraph shall be with
13fee simple title, free of all liens and encumbrances.

14(d) Maintenance.--An authority shall maintain all of its
15real property in accordance with the statutes and ordinances of
16the jurisdiction in which the real property is located.

17(e) Prohibition.--

18(1) Subject to the provisions of paragraph (2), an
19authority may not own or hold real property located outside
20the jurisdictional boundaries of the entities which created
21the authority under section 1704(c) (relating to creation and
22existence).

23(2) An authority may be granted authority pursuant to an
24intergovernmental cooperation agreement with a municipality
25to manage and maintain real property located within the
26jurisdiction of the municipality.

27(f) Tax claim bureaus.--A tax claim bureau may transfer to
28an authority real property of the county held by the tax claim
29bureau, as trustee for the county.

30(g) Acquisition of tax delinquent properties.--If authorized

1by the community development authority jurisdiction which
2created an authority or otherwise by intergovernmental
3cooperation agreement, an authority may accept donations of real
4property and extinguish delinquent claims for taxes as to the
5property under section 5.1 of the act of May 16, 1923 (P.L.207,
6No.153), referred to as the Municipal Claim and Tax Lien Law, or
7section 303 of the act of July 7, 1947 (P.L.1368, No.542), known
8as the Real Estate Tax Sale Law. For the purposes of this
9subsection, the authority shall have all rights and obligations
10of the municipality provided for in section 5.1 of the Municipal
11Claim and Tax Lien Law.

12(h) Donation to microenterprise.--Notwithstanding any other
13provision of law to the contrary, if a tax delinquent property
14offered at judicial sale is not sold, the trustee may donate the
15property to an authority for the purpose of a microenterprise
16after written notification of the transfer to all interested
17parties.

18§ 1710. Disposition of property.

19(a) Public access to inventory.--An authority shall maintain
20and make available for public review and inspection an inventory
21of real property held by the authority.

22(b) Power.--The authority may convey, exchange, sell,
23transfer, lease, grant or mortgage interests in real property of
24the authority in the form and by the method determined to be in
25the best interests of the authority.

26(c) Consideration.--

27(1) The authority shall determine the amount and form of
28consideration necessary to convey, exchange, sell, transfer,
29lease as lessor, grant or mortgage interests in real
30property.

1(2) Consideration may take the form of monetary payments
2and secured financial obligations, covenants and conditions
3related to the present and future use of the property,
4contractual commitments of the transferee and other forms of
5consideration as determined by the board to be in the best
6interest of the authority.

7(d) Policies and procedures.--

8(1) A board shall determine and state in the authority
9policies and procedures the general terms and conditions for
10consideration to be received by the authority for the
11transfer of real property and interests in real property.

12(2) Requirements which may be applicable to the
13disposition of real property and interests in real property
14by municipalities shall not be applicable to the disposition
15of real property and interests in real property by the
16authority.

17(e) Land use plans.--The authority shall consider all duly
18adopted land use plans and make reasonable efforts to coordinate
19the disposition of an authority's real property with such land
20use plans.

21(f) Specific voting and approval requirements.--

22(1) A community development authority jurisdiction may,
23in its ordinance creating an authority or in the case of
24multiple community development authority jurisdictions and
25municipalities creating a single authority in the applicable
26intergovernmental cooperation agreement, require that a
27particular form of disposition of real property or a
28disposition of real property located within specified
29jurisdictions be subject to specified voting and approval
30requirements of the board.

1(2) Except as restricted or constrained under paragraph
2(1), the board may delegate to officers and employees the
3authority to enter into and execute agreements, instruments
4of conveyance and other related documents pertaining to the
5conveyance of real property by the authority.

6§ 1711. Financing of authority operations.

7(a) General rule.--The authority may receive funding through
8grants and loans from:

9(1) the Federal Government;

10(2) the Commonwealth;

11(3) a municipality;

12(4) the community development authority jurisdiction
13which created the authority; and

14(5) private sources.

15(b) Funding.--An authority may receive and retain payments
16for services rendered, for rents and leasehold payments
17received, for consideration for disposition of real and personal
18property, for proceeds of insurance coverage for losses
19incurred, for income from investments and for an asset and
20activity lawfully permitted to the authority under this chapter.

21(c) Allocated real property taxes.--

22(1) A taxing jurisdiction may authorize the remittance
23or dedication of a portion of real property taxes collected
24pursuant to the laws of this Commonwealth to the authority on
25real property conveyed by an authority.

26(2) Allocation of property tax revenues in accordance
27with this subsection, if authorized by the taxing
28jurisdiction, shall commence with the first taxable year
29following the date of conveyance and continue for a period of
30up to five years and may not exceed a maximum of 50% of the

1aggregate property tax revenues generated by the property.

2(3) Remittance or dedication of real property taxes
3shall include the real property taxes of a school district
4only if the school district enters into an agreement with the
5authority for the remittance or dedication.

6§ 1712. Fund.

7(a) Fund established.--A separate fund within the State
8Treasury, to be known as the Community Small Business
9Development Fund, is established. The following apply:

10(1) The State Treasurer shall invest 20% of the fund.

11(2) The fund shall operate as a revolving fund whereby
12all appropriations and payments made thereto may be applied
13and reapplied to the purposes of this section.

14(3) The balance of the fund at any time may not be less
15than 20% of the initial funding.

16(a.1) Source.--The fund shall receive moneys from the
17following sources:

18(1) State appropriations.

19(2) Federal appropriations.

20(3) Repayment of loan principal.

21(4) Payment on interest loans made by the fund board.

22(5) Gifts and other contributions from public and
23private sources. Contributions from a financial institution
24to the fund may be used by the financial institution to meet
25the requirements of the Community Reinvestment Act of 1977
26(91 Stat. 1111, 12 U.S.C. § 2901 et seq.) to the extent
27permissible under that act.

28(b) Grants.--The fund shall be in part supplemented by
29matching grants through private partners, including financial
30institutions. Grants shall be made by an authority in

1partnership with private financial institutions to
2microenterprises. A total of two grants shall be made to
3microenterprises as follows:

4(1) The initial grant shall be at least 1.5% and no more
5than 5% of the amount of the State contribution to the fund,
6with an equal amount to be contributed by the private partner
7and a portion of the total amount of the grant to be used to
8finance a delinquency fund to cover losses incurred by the
9fund.

10(2) The second grant to be contributed by the private
11partner shall be an amount equal to 10% of the loan provided
12by a community development financial institution to the
13microenterprise. A grant under this paragraph is limited to
14$50,000.

15(c) Board.--The fund shall be under the general supervision
16of a board of directors, which board shall be an independent
17board in the department. The fund board shall be comprised of
18the following members:

19(1) The secretary or a designee of the secretary, who
20shall serve as chairperson of the fund board.

21(2) Two members appointed by the President pro tempore
22of the Senate and two members appointed by the Minority
23Leader of the Senate.

24(3) Two members appointed by the Speaker of the House of
25Representatives and two members appointed by the Minority
26Leader of the House of Representatives.

27(4) No more than four members appointed by the secretary
28who represent the fund's private partners chosen from a list
29of nominees provided by the fund's private partners.

30(d) Loan.--An authority may apply to the fund board for a

1loan under this section. Upon approval of the loan by the fund
2board, a loan shall be made to an authority from the fund in
3accordance with the following:

4(1) A loan shall be made from the fund to an authority
5for the purpose of lending funds to microenterprises that are
6operating on the property owned by the authority. A loan to a
7microenterprise shall be a minimum of $5,000 and a maximum of
8$10,000.

9(2) If the fund board approves by a 60% majority vote, a
10loan from the fund may be made to microenterprises in <-cities
<-11municipalities under the act of July 10, 1987 (P.L.246,
12No.47), known as the Municipalities Financial Recovery Act,
13or their successors.

14(3) Authorities may partner with private entities that
15issue microloans for the purpose of providing loans to
16existing microenterprises for business expansion.

17(4) For the purpose of reducing the risk involved with
18making the loan and providing applicants the skills necessary
19to succeed, all applicants for a loan from an authority must
20complete business courses and workshops on operating a
21business, creating market strategy and customer interaction.
22The department shall assist authorities in identifying
23organizations that can partner with or provide training
24resources to applicants. The authority shall direct
25applicants to the organizations that provide the training
26required by this paragraph.

27(5) Authorities may partner with private entities to use
28their facilities or expertise to help facilitate the required
29entrepreneurial training for applicants. The following apply:

30(i) Private partners under this paragraph may

1include commercial or nonprofit groups specializing in
2training start-up entrepreneurs.

3(ii) The authority may enter into contracts to pay
4private partners to expand their operations to provide
5the applicant training. Moneys may not be paid for this
6purpose unless the fund board approves the expenditure by
7a two-thirds majority vote.

8(iii) An authority may also form a partnership with
9a commercial, nonprofit or religious entity for the
10purpose of acquiring building space, which may be leased
11or donated, for applicant training.

12(6) The terms of the loan are to be established by the
13authority, the fund board and an area loan organization. The
14fund board shall develop loan program criteria that is
15consistent with criteria used by area loan organizations.

16(7) If loan payments become delinquent, the fund board
17shall offer a hardship agreement to the microenterprise to
18restructure the payment process.

19(8) Special priority is to be given to qualified
20veterans and minority applicants as determined by the area
21loan organizations.

22§ 1713. Borrowing and issuance of bonds.

23(a) Authority.--

24(1) An authority may issue a bond for any of its
25corporate purposes.

26(2) The principal and interest of a bond shall be
27payable from the authority's general revenue.

28(3) The bond may be secured by any of the following:

29(i) A pledge of revenue. This subparagraph includes
30a grant or contribution from:

1(A) The Federal Government or a Federal agency
2or instrumentality.

3(B) The Commonwealth, a Commonwealth agency or
4an instrumentality of the Commonwealth.

5(ii) A mortgage of property of the authority.

6(b) Nature.--The bond must meet the requirements of 13
7Pa.C.S. § 3104 (relating to negotiable instrument).

8(c) Tax exempt.--A bond and the income from the bond is
9exempt from taxation by:

10(1) the Commonwealth; or

11(2) a political subdivision.

12(d) Procedure.--

13(1) A bond must be authorized by resolution of the board
14and shall be a limited obligation of the authority.

15(2) The principal and interest, costs of issuance and
16other costs incidental to the bond shall be payable solely
17from the income and revenue derived from the sale, lease or
18other disposition of the assets of the authority. The
19authority may secure the bond by a mortgage or other security
20device covering all or part of the project from which the
21pledged revenues may be derived.

22(3) A refunding bond issued under this section:

23(i) shall be payable from:

24(A) a source described in this chapter; or

25(B) the investment of the proceeds of the
26refunding bonds; and

27(ii) shall not constitute an indebtedness or pledge
28of the general credit of a political subdivision within
29the meaning of a constitutional or statutory limitation
30of indebtedness and shall contain a recital to that

1effect.

2(4) A bond must comply with the authorizing resolution
3as to:

4(i) form;

5(ii) denomination;

6(iii) interest rate;

7(iv) maturity; and

8(v) execution.

9(5) A bond may be subject to redemption at the option of
10and in the manner determined by the board in the authorizing
11resolution.

12(e) Powers of municipalities.--A municipality may elect to
13guarantee, insure or otherwise become primarily or secondarily
14obligated on the indebtedness of the authority, subject,
15however, to all other provisions of law of this Commonwealth
16applicable to municipal indebtedness.

17(f) Sale.--

18(1) A bond shall be issued, sold and delivered in
19accordance with the terms and provisions of the authorizing
20resolution. The board, to effectuate its best interest, may
21determine the manner of sale, public or private, and the
22price of the bond.

23(2) The resolution issuing a bond must be published in a
24newspaper of general circulation within the jurisdiction in
25which the authority is located.

26(g) Liability.--

27(1) Neither the members of an authority nor a person
28executing the bond shall be liable personally on the bonds by
29reason of the issuance of the bond.

30(2) The bond or other obligation of the authority

1related to a bond shall not be a debt of a municipality or of
2the Commonwealth. A statement to this effect shall appear on
3the face of the bond or obligation.

4(3) On the bond or other obligation of the authority
5related to a bond, all of the following apply:

6(i) The Commonwealth has no liability. This
7subparagraph applies to the revenue and property of the
8Commonwealth.

9(ii) A municipality has no liability. This
10subparagraph applies to the revenue and property of a
11municipality.

12§ 1714. Public records and public access.

13(a) Public records.--A board shall keep minutes and a record
14of its proceedings.

15(b) Public access.--The authority is subject to:

16(1) 65 Pa.C.S. Ch. 7 (relating to open meetings); and

17(2) the act of February 14, 2008 (P.L.6, No.3), known as
18the Right-to-Know Law.

19§ 1715. Merger.

20(a) Merger and consolidation authorized.--An authority and
21an existing economic development authority may be merged into
22one authority, which for purposes of this section shall be
23designated as the surviving authority, or consolidated into a
24new authority.

25(b) Articles of merger or consolidation.--Articles of merger
26or articles of consolidation, as the case may be, shall first be
27proposed by the governing body of the municipality or
28municipalities creating the authority. The governing body of the
29municipality or municipalities incorporating one or more of the
30existing authorities shall each adopt <-a an identical resolution

1which shall contain the language of the proposed merger or
2consolidation. The articles of merger or consolidation shall be
3signed by the proper officers of the municipality or
4municipalities and under their respective municipal seals and
5shall set forth the following:

6(1) The name of the surviving or new authority.

7(2) The location of the registered office of the
8surviving or new authority.

9(3) The names and addresses and term of office of the
10members of the board of the surviving or new authority as
11specified in the plan of merger or consolidation.

12(4) A statement indicating the date on which each
13existing authority was formed and the purpose for which it
14was formed, taken from the articles of incorporation, the
15name of the original incorporating municipality or
16municipalities and the name of any successor to the original
17incorporating municipality or municipalities thereof.

18(5) The time and place of the meetings of the governing
19bodies of the municipality or municipalities party to the
20plan of merger or consolidation.

21(6) A statement of the plan of merger and a timeline for
22implementing the plan for merger.

23(7) Any changes in the articles of incorporation of the
24surviving authority in the case of a merger and a statement
25of the articles of incorporation in full in the case of the
26new authority to be formed, in each case in conformity with
27the provisions of this chapter relating to the incorporation
28of authorities, except that any item required to be stated
29which is covered elsewhere in the articles of merger or
30consolidation need not be repeated.

1(c) Publication of resolution.--Each municipality party to
2the plan of merger or consolidation shall cause a notice of the
3resolution setting forth the merger or consolidation to be
4published at least one time in the legal periodical of the
5county or counties in which the surviving authority is to be
6organized and at least one time in a newspaper published and in
7general circulation in such county or counties. The notice shall
8contain a brief statement of the substance of the resolution,
9including the substance of the articles of merger making
10reference to this chapter, and shall state that on a day
11certain, not less than three days after publication of the
12notice, articles of merger or consolidation shall be filed with
13the Secretary of the Commonwealth. The publication shall be in
14sufficient compliance with the laws of this Commonwealth or any
15existing laws dealing with publication for municipalities.

16(d) Documentation.--The articles of merger or consolidation
17shall be filed on or before the day specified in the
18advertisement with the Secretary of the Commonwealth together
19with the proof of publication of the notice required under
20subsection (c).

21(e) Certification of merger or consolidation.--The Secretary
22of the Commonwealth shall file the articles of merger or
23consolidation and the proof of advertisement required in
24subsection (c), but not prior to the day specified in the
25advertisement, certify the date of the filing when all fees and
26charges have been paid and issue to the surviving or new
27authority or its representative a certificate of merger or
28consolidation to which shall be attached a copy of the filed
29articles of merger or consolidation.

30(f) Filing the articles of merger or consolidation.--Upon

1the filing of the articles of merger or consolidation by the
2Secretary of the Commonwealth, the merger or consolidation shall
3be effective, and, in the case of a consolidation, the new
4authority shall come into existence, and, in either case, the
5articles of merger or consolidation shall constitute the
6articles of incorporation of the surviving or new authority.

7(g) Creation of surviving or new authority.--Upon the merger
8or consolidation becoming effective, the several existing
9authorities to the plan of merger or consolidation shall become
10a single authority, which in the case of a merger shall be that
11authority designated in the articles of merger as the surviving
12authority and in the case of a consolidation shall be a new
13authority as provided in the articles of consolidation. The
14separate existence of all existing authorities named in the
15articles of merger or consolidation shall cease, except that of
16the surviving authority in the case of a merger.

17(h) Disposition of property and accounts.--All of the
18property, real, personal and mixed, and all interests in the
19property of each of the existing authorities named in the plan
20of merger or consolidation, all debts due and whatever amount
21due to any of them, including their respective right, title and
22interest in and to all lease rentals, sinking funds on deposit,
23all funds deposited under lease or trust instruments shall be
24taken and deemed to be transferred to and vested in the
25surviving or new authority, as the case may be, without further
26act or deed.

27(i) Continuation of contracts.--The surviving authority or
28the new authority shall be responsible for the liabilities and
29obligations of each of the existing authorities so merged or
30consolidated but shall be subject to the same limitations,

1pledges, assignments, liens, charges, terms and conditions as to
2revenues and restrictions and as to leases of properties as were
3applicable to each existing authority. The liabilities of the
4merging or consolidating authorities or the members of their
5boards or officers shall not be affected nor shall the rights of
6creditors thereof or any persons dealing with the merging or
7consolidating authorities or any liens upon the property of the
8merging or consolidating authorities or any outstanding bonds be
9impaired by the merger or consolidation, and any claim existing
10or action or proceeding pending by or against any such
11authorities shall be prosecuted to judgment as if the merger or
12consolidation had not taken place, or the surviving authority or
13the new authority may be proceeded against or substituted in its
14place.

15§ 1716. Dissolution of authority.

16(a) General rule.--An authority may be dissolved as a public
17body corporate and politic upon compliance with all of the
18following:

19(1) Sixty calendar days' advance written notice of
20consideration of a resolution to request dissolution must:

21(i) be given to the community development authority
22jurisdiction which created the authority;

23(ii) be published in a local newspaper of general
24circulation; and

25(iii) be sent by certified mail to the trustees of
26outstanding bonds of the authority.

27(2) A resolution requesting dissolution must be approved
28under section 1705(h)(3) (relating to board).

29(b) Authority.--Upon receipt of a proper resolution
30described in subsection (a)(1), the community development

1authority jurisdiction which created the authority may dissolve
2the authority by adoption of an ordinance subject to the<-
3approval of the mayor in a city or the county executive in a
4home rule county. If approved, the governing body of the
5community development authority jurisdiction which created the
6authority shall file a certified copy of the ordinance with the
7Department of State, and the Secretary of the Commonwealth shall
8cause the termination of the existence of the authority to be
9noted on the record of incorporation. Upon such filing, the
10authority shall cease to function. The Secretary of the
11Commonwealth shall also notify the department of the dissolution
12of the authority.

13(c) Transfer of assets.--Upon dissolution of the authority,
14real property, personal property and other assets of the
15authority shall become the assets of the municipality in which
16the property is located. The following shall apply:

17(1) Personal property, including financial assets, of
18the authority shall be divided among participating community
19development authority jurisdictions in proportion to the
20population of each jurisdiction.

21(2) The municipality in which real property is located
22shall approve the transfer of title to the municipality.

23(d) Multiple jurisdictions.--If multiple community
24development authority jurisdictions create an authority under
25section 1704(c) (relating to creation and existence), the
26withdrawal of one or more community development authority
27jurisdictions shall not require dissolution of the authority
28unless:

29(1) the intergovernmental cooperation agreement provides
30for dissolution in this event; and

1(2) there is no community development authority
2jurisdiction which desires to continue the existence of the
3authority.

4§ 1717. Conflicts of interest.

5(a) Applicability of adverse interest act.--The acts and
6decisions of members of a board and of employees of the
7authority shall be subject to the act of July 19, 1957
8(P.L.1017, No.451), known as the State Adverse Interest Act.

9(b) Ethical standards.--Board members and authority
10employees are subject to 65 Pa.C.S. Ch. 11 (relating to ethics
11standards and financial disclosure).

12(c) Supplemental rules and guidelines.--The board may adopt:

13(1) supplemental rules addressing potential conflicts of
14interest; and

15(2) ethical guidelines for members of the board and
16employees of the authority.

17§ 1718. Construction, intent and scope.

18This chapter shall be construed liberally to effectuate the
19legislative intent and the purposes as complete and independent
20authorization for the implementation of this chapter, and all
21powers granted shall be broadly interpreted to effectuate the
22intent and purposes and not as a limitation of powers.

23§ 1719. Annual audit and report.

24The following shall apply:

25(1) An authority shall annually, within 120 days after
26the end of the fiscal year, submit an audit of income and
27expenditures, together with a report of its activities for
28the preceding year, to the department.

29(2) A duplicate of the audit and the report shall be
30filed with the governing body of:

1(i) the community development authority jurisdiction
2which created the authority; and

3(ii) each municipality which opted to participate in
4the authority pursuant to an intergovernmental agreement.

5§ 1720. Collaboration of community development financial
6institutions with authorities.

7Community development financial institutions within a <-city
<-8municipality are eligible for financial assistance for the
9purpose of providing loans to microenterprises that operate on
10leased property acquired by an authority. The financial
11assistance:

12(1) Shall be paid from the fund.

13(2) Is limited to an amount equal to 50% of the loan to
14the microenterprise.

15(3) May not exceed $10,000.

16§ 1721. Cost sharing.

17If an authority acquires property in a city for demolition,
18the former lienholder of the property acquired shall share the
19authority's demolition costs.

20Section 2. Title 72 is amended by adding a chapter to read:

21CHAPTER 31

22MICROENTERPRISE ASSISTANCE

23Subchapter

24A. Preliminary Provisions

25B. Tax Credit for Community Small Business Development

26C. Microenterprise Tax Credit

27D. Business Entity Tax Credit

28E. Tax Credit for Mixed-use and Space-sharing Projects

29F. Miscellaneous Provisions

30SUBCHAPTER A

1PRELIMINARY PROVISIONS

2Sec.

33101. Definitions.

4§ 3101. Definitions.

5The following words and phrases when used in this chapter
6shall have the meanings given to them in this section unless the
7context clearly indicates otherwise:

8"Company." Any corporation, partnership, limited liability
9company, limited liability partnership, business trust,
10affiliate, unincorporated joint venture or other business entity
11doing business within this Commonwealth.

12"Department." The Department of Community and Economic
13Development of the Commonwealth.

14"Fund." The Community Small Business Development Fund.

15"Microenterprise." A business operated by a sole proprietor
16or limited liability company that employs one to five employees
17and has the qualifying amount of capital provided under the
18Small Business Jobs Act of 2010 (Public Law 111-240, 124 Stat.
192504).

20"Qualified microenterprise expenditures." The increase in
21costs and expenses incurred by a qualified taxpayer:

22(1) for new equipment or for the cost of equipment
23repairs over costs expended in the prior year for equipment;
24and

25(2) for leasing space over costs expended in the prior
26year for leasing space.

27"Qualified tax liability." The liability for taxes imposed
28under Article III, IV or IX of the act of March 4, 1971 (P.L.6,
29No.2), known as the Tax Reform Code of 1971. The term includes
30the liability for taxes imposed under Article III of the Tax

1Reform Code of 1971 on the owner or owners of a pass-through
2entity. The term does not include amounts withheld or required
3to be withheld from employees under Article III of the Tax
4Reform Code of 1971.

5"Qualified taxpayer." Any natural person, corporation,
6business trust, limited liability company, partnership, limited
7liability partnership, association or any other form of legal
8business entity that is subject to a tax imposed under Article
9III, IV or IX of the Tax Reform Code of 1971 excluding any tax
10withheld by an employer under Article III of the Tax Reform Code
11of 1971.

12"Tax credit." A tax credit provided under this chapter.

13SUBCHAPTER B

14TAX CREDIT FOR COMMUNITY SMALL BUSINESS DEVELOPMENT

15Sec.

163121. Tax credit.

173122. Duties.

183123. Use of tax credits by qualified taxpayers.

193124. Sale, carryover and carryback.

203125. Sale of tax credits to qualified taxpayers.

213126. Payment for tax credits purchased and certificates.

223127. Failure to make contribution of capital and reallocation.

23§ 3121. Tax credit.

24A qualified taxpayer may purchase tax credits from the
25department in accordance with this subchapter and may apply the
26tax credits against its qualified tax liability in accordance
27with this chapter.

28§ 3122. Duties.

29The department shall have the authority to sell up to
30$50,000,000 in tax credits to qualified taxpayers. The sale of

1the tax credits shall be in accordance with section 3125
2(relating to sale of tax credits to qualified taxpayers). No tax
3credits may be sold after December 31, 2019.

4§ 3123. Use of tax credits by qualified taxpayers.

5(a) Use against qualified tax liability.--A qualified
6taxpayer that purchases tax credits under section 3125 (relating
7to sale of tax credits to qualified taxpayers) may claim the
8credits beginning in calendar year 2015 against qualified tax
9liability incurred for the taxable year that begins on or after
10January 1, 2014, and must apply the credits against qualified
11tax liability beginning no later than the taxable year that
12begins in calendar year 2017.

13(b) Application to department.--A qualified taxpayer seeking
14to use purchased tax credits may submit an application to the
15department in a manner prescribed by the department.

16(c) Limitations.--The credit to be applied in any one year
17may not exceed:

18(1) The qualified tax liability of the qualified
19taxpayer for that taxable year.

20(2) Twenty percent of the purchased credit.

21§ 3124. Sale, carryover and carryback.

22(a) Carryover.--If the qualified taxpayer cannot use the
23entire amount of the tax credit for the taxable year in which
24the taxpayer is eligible for the credit, the excess may be
25carried over to no more than the next succeeding three taxable
26years and used as a credit against the qualified tax liability
27of the taxpayer for those taxable years, provided that the
28credit may not be carried over to any taxable year that begins
29after December 31, 2025.

30(b) Sale.--No sooner than 30 days after providing the

1department written notice of the intent to transfer tax credits,
2a qualified taxpayer may transfer tax credits held without
3restriction to any entity that is a qualified taxpayer in good
4standing with the Department of Revenue and that agrees to
5assume all of the transferor's obligations with respect to the
6tax credit.

7(c) Carryback.--A qualified taxpayer may not carry back a
8tax credit.

9§ 3125. Sale of tax credits to qualified taxpayers.

10(a) Conduct of sale.--The sale of tax credits authorized
11under section 3122 (relating to duties) shall be conducted in
12accordance with this section.

13(b) Process.--The department may sell the tax credits
14authorized under this subchapter or may contract with an
15independent third party to conduct a bidding process among
16qualified taxpayers to purchase the tax credits. In raising
17capital for the fund, the department shall have the discretion
18to distribute tax credits using a market-driven approach or any
19approach that maximizes the yield to the Commonwealth.

20(c) Application.--A qualified taxpayer seeking to purchase
21tax credits may apply to the department in the manner prescribed
22by the department.

23(d) Bidding process.--Using procedures adopted by the
24department or, if applicable, by an independent third party,
25each qualified taxpayer that submits an application shall make a
26timely and irrevocable offer, subject only to the department's
27issuance to the taxpayer of tax credit certificates, to make
28specified contributions of capital to the department for payment
29into the fund on dates specified by the department.

30(e) Contents of offer.--The offer under subsection (d) must

1include all of the following:

2(1) The requested amount of tax credits, which may not
3be more than a total of $2,000,000.

4(2) The qualified taxpayer's capital contribution for
5each tax credit dollar requested, which may not be less than
6the greater of either of the following:

7(i) Seventy-five percent of the requested dollar
8amount of tax credits.

9(ii) The percentage of the requested dollar amount
10of tax credits that the department and, if applicable,
11the independent third party, determines to be consistent
12with market conditions as of the offer date.

13(3) Any other information the department or, if
14applicable, independent third party requires.

15(f) Notice of approval.--Each qualified taxpayer that
16submits an application under this section shall receive a
17written notice from the department indicating whether it has
18been approved as a purchaser of tax credits and, if so, the
19amount of tax credits allocated.

20§ 3126. Payment for tax credits purchased and certificates.

21(a) Payment of capital.--Twenty-five percent of the capital
22committed by a qualified taxpayer shall be paid to the
23department for deposit into the fund, and the remaining capital
24shall be paid to the department for deposit into the General
25Fund. Nothing under this section shall prohibit the department
26from establishing an installment payment schedule for capital
27payments to be made by the qualified taxpayer.

28(b) Issuance of tax credit certificates.--On receipt of
29payment of capital, the department shall issue to each qualified
30taxpayer a tax credit certificate representing a fully vested

1credit against qualified tax liability.

2(c) Certificate issued in accordance with bidding process.--
3The department shall issue tax credit certificates to qualified
4taxpayers in accordance with the bidding process selected by the
5department or the independent third party. The department may
6give priority for the purchase of credits to qualified taxpayers
7that are smaller companies.

8(d) Contents.--The tax credit certificate shall state all of
9the following:

10(1) The total amount of tax credits that the qualified
11taxpayer may claim.

12(2) The amount of capital that the qualified taxpayer
13has contributed or agreed to contribute in return for the
14issuance of the tax credit certificate.

15(3) The dates on which the tax credits will be available
16for use by the qualified taxpayer.

17(4) Any penalties or other remedies for noncompliance.

18(5) The procedures to be used for transferring the tax
19credits.

20(6) Any other requirements the department considers
21necessary.

22§ 3127. Failure to make contribution of capital and
23reallocation.

24(a) Prohibition.--A tax credit certificate under section
253126 (relating to payment for tax credits purchased and
26certificates) may not be issued to any qualified taxpayer that
27fails to make a contribution of capital within the time the
28department specifies.

29(b) Penalty.--A qualified taxpayer that fails to make a
30contribution of capital within the time the department specifies

1shall be subject to a penalty equal to 10% of the amount of
2capital that remains unpaid. The penalty shall be paid to the
3department within 30 days after demand.

4(c) Reallocation.--The department may offer to reallocate
5the defaulted capital among other qualified taxpayers, so that
6the result after reallocation is the same as if the initial
7allocation had been performed without considering the tax credit
8allocation to the defaulting qualified taxpayer.

9(d) Contribution.--If the reallocation of capital under
10subsection (c) results in the contribution by another qualified
11taxpayer of the amount of capital not contributed by the
12defaulting qualified taxpayer, the department may waive the
13penalty provided under subsection (b).

14(e) Transfer.--A qualified taxpayer that fails to make a
15contribution of capital within the time specified may avoid the
16imposition of the penalty by transferring the allocation of tax
17credits to a new or existing qualified taxpayer within 30 days
18after the due date of the defaulted installment. Any transferee
19of an allocation of tax credits of a defaulting qualified
20taxpayer under this subsection shall agree to make the required
21contribution of capital within 30 days after the date of the
22transfer.

23SUBCHAPTER C

24MICROENTERPRISE TAX CREDIT

25Sec.

263141. Microenterprise tax credit.

27§ 3141. Microenterprise tax credit.

28(a) Application.--

29(1) A qualified taxpayer that is a microenterprise owner
30may apply to the department for a tax credit certificate

1under this section.

2(2) The application shall be on the form required by the
3department.

4(3) The application shall be filed on or before February
51 for qualified microenterprise expenditures incurred.

6(b) Procedure.--If the department approves the application,
7it shall issue the qualified taxpayer a tax credit certificate
8by April 1. A tax credit certificate issued under this section
9shall not exceed 20% of qualified microenterprise expenditures
10determined by the department under paragraph (1) of the
11definition of "qualified microenterprise expenditures" in
12section 3101 (relating to definitions) and an additional amount
13not to exceed 20% of qualified microenterprise expenditures
14determined by the department under paragraph (2) of the
15definition of "qualified microenterprise expenditures" in
16section 3101.

17(c) Claiming the credit.--Upon presenting a tax credit
18certificate to the Department of Revenue, the qualified taxpayer
19may claim a tax credit against the qualified tax liability of
20the qualified taxpayer. A tax credit certificate received by the
21Department of Revenue in a taxable year first shall be applied
22against the qualified taxpayer's qualified tax liability for the
23current taxable year as of the date on which the credit was
24issued before the tax credit can be applied against any
25qualified tax liability under section 3124 (relating to sale, 
26carryover and carryback).

27(d) Limitation.--A qualified taxpayer may apply for a tax
28credit under this section no more than twice in a two-year
29period.

30SUBCHAPTER D

1BUSINESS ENTITY TAX CREDIT

2Sec.

33151. Business entity tax credit.

4§ 3151. Business entity tax credit.

5(a) Application.--

6(1) A qualified taxpayer that is a company may apply to
7the department for a tax credit certificate under this
8section.

9(2) The application shall be on the form required by the
10department.

11(3) The application shall be filed on or before February
121.

13(b) Procedure.--If the department approves the application,
14it shall issue the qualified taxpayer a tax credit certificate
15by April 1. A tax credit under this section shall be equal to:

16(1) Fifteen percent of the value of any equipment sold
17by the company to a microenterprise, as determined by the
18department.

19(2) A tax credit in the amount of $300 for each
20microenterprise owner that the company provides with on-the-
21job training.

22(c) Claiming the credit.--Upon presenting a tax credit
23certificate to the Department of Revenue, the qualified taxpayer
24may claim a tax credit against the qualified tax liability of
25the qualified taxpayer. A tax credit certificate received by the
26Department of Revenue in a taxable year first shall be applied
27against the qualified taxpayer's qualified tax liability for the
28current taxable year as of the date on which the credit was
29issued before the tax credit can be applied against any
30qualified tax liability under section 3124 (relating to sale,
 

1carryover and carryback).

2(d) Conditions.--

3(1) The equipment sold shall not be defective or of
4deficient quality.

5(2) The equipment sold must be subject to a warranty for
6a term of at least six months.

7(e) User error.--Reasonably expected user error by a
8microenterprise which damages or prevents the use of the
9equipment does not affect eligibility for a tax credit under
10subsection (b).

11SUBCHAPTER E

12TAX CREDIT FOR MIXED-USE AND SPACE-SHARING PROJECTS

13Sec.

143161. Tax credit for developing mixed-use and space-sharing
15projects.

163162. Tax credit for developing space-sharing projects.

17§ 3161. Tax credit for developing mixed-use and space-sharing
18projects.

19(a) Tax credit.--A qualified taxpayer that purchases
20property for development from an authority is eligible for a tax
21credit under this section if:

22(1) The authority has demolished any improvements to the
23property.

24(2) The property development by the qualified taxpayer
25is a mixed-use development project.

26(b) Amount of credit.--The tax credit under this section
27shall be equal to 15% of the net profit attributable to the
28mixed-use development project and applied against the qualified
29taxpayer's qualified tax liabilities incurred in the taxable
30year for which the credit was approved. If the net profit is

1reinvested in other mixed-use development, the tax credit shall
2be equal to 15% of those profits and applied against the
3qualified taxpayer's qualified tax liabilities incurred in the
4taxable year for which the credit was approved.

5§ 3162. Tax credit for developing space-sharing projects.

6A qualified taxpayer in a <-city municipality is eligible to
7receive a tax credit for developing shared space for
8microenterprises located in a city. The tax credit shall be
9equal to 15% percent of the net profit attributable to the
10shared-space development and applied against the qualified
11taxpayer's qualified tax liabilities incurred in the taxable
12year for which the credit was approved. If the net profit is
13reinvested in other shared-space development, the tax credit
14shall be equal to 15% of those profits and applied against the
15qualified taxpayer's qualified tax liabilities incurred in the
16taxable year for which the credit was approved.

17SUBCHAPTER F

18MISCELLANEOUS PROVISIONS

19Sec.

203191. Carryover, carryback and sale.

213192. Regulations.

22§ 3191. Carryover, carryback and sale.

23(a) Carryover.--If a qualified taxpayer under Subchapter B
24(relating to tax credit for community small business
25development), C (relating to microenterprise tax credit), D
26(relating to business entity tax credit) or E (relating to tax
27credit for mixed-use and space-sharing projects) cannot use the
28entire amount of the tax credit for the taxable year in which
29the taxpayer is eligible for the credit, the excess may be
30carried over to succeeding taxable years and used as a credit

1against the qualified tax liability of the taxpayer for those
2taxable years.

3(b) Carryback.--A qualified taxpayer under Subchapter B, C,
4D or E may not carry back or obtain a refund of an unused tax
5credit.

6(c) Sale or assignment.--The following shall apply:

7(1) A qualified taxpayer, upon application to and
8approval by the department, may sell or assign, in whole or
9in part, a tax credit granted to the qualified taxpayer under 
10Subchapter B, C, D or E.

11(2) Before an application is approved, the department
12must find that the applicant has filed all required State tax
13reports and returns for all applicable taxable years and paid
14any balance of State tax due as determined at settlement,
15assessment or determination by the department.

16§ 3192. Regulations.

17The department, in consultation with the Department of
18Revenue, shall promulgate regulations implementing this chapter.

19Section 3. This act shall take effect in 60 days.