1Amending the act of June 27, 2006 (1st Sp.Sess., P.L.1873,
2No.1), entitled "An act providing for taxation by school
3districts, for the State funds formula, for tax relief in
4first class cities, for school district choice and voter
5participation, for other school district options and for a
6task force on school cost reduction; making an appropriation;
7prohibiting prior authorized taxation; providing for
8installment payment of taxes; restricting the power of
9certain school districts to levy, assess and collect taxes;
10and making related repeals," further providing for
11certification and calculation of minimum and maximum
12modifiers and for the Property Tax Relief Reserve Fund;
13providing for senior citizen tax relief; and further
14providing for State property tax reduction allocation.

15The General Assembly of the Commonwealth of Pennsylvania
16hereby enacts as follows:

17Section 1. Section 503(e)(2) introductory paragraph of the
18act of June 27, 2006 (1st Sp.Sess., P.L.1873, No.1), known as
19the Taxpayer Relief Act, is amended and the subsection is
20amended by adding a paragraph to read:

21Section 503. Certification; calculation of minimum and maximum
22modifiers.

1* * *

2(e) Distribution.--

3* * *

4(2) For fiscal year 2009-2010 [and each fiscal year
5thereafter] through fiscal year 2012-2013, the secretary
6shall distribute the difference between the amount certified
7under subsection (a)(1)(i) and the sum of all of the
8following:

9* * *

10(3) For fiscal year 2013-2014 and each fiscal year
11thereafter, the secretary shall distribute the difference
12between the amount certified under subsection (a)(1)(i) and
13the sum of all of the following:

14(i) The difference between the sum of:

15(A) the amount of approved claims to be paid in
16the next fiscal year under section 1304(a)(2)(i) and
17(3); and

18(B) the amount of approved claims paid in the
192006-2007 fiscal year under section 1304(a)(1).

20(ii) The sum of all of the following:

21(A) The amount sufficient to fund reimbursements
22to eligible school districts pursuant to section 324.
23The amount deducted under this clause shall be
24calculated based on the information provided by
25school districts under subsection (b)(2).

26(B) The amount of approved claims under section
27704.

28(C) The amount of approved claims under section
291304(a)(2)(ii).

30(D) The amount of payments to school districts

1under section 504.1.

2Section 2. Section 504(d)(1) of the act is amended to read:

3Section 504. Property Tax Relief Reserve Fund.

4* * *

5(d) Transfers.--

6(1) The secretary may authorize a transfer from the
7Property Tax Relief Reserve Fund to the fund if the amount
8for distribution under section 503(e) in 2014 is less than
9the amount for distribution under section 503(e) [made in the
10prior year] in 2013 or any year thereafter. [The] Beginning 
11in 2015 and each year thereafter, the amount of the transfer
12under this subsection shall be equal to the difference
13between the amount for distribution under section 503(e) and
14the amount for distribution under section 503(e) made in the
15prior year.

16* * *

17Section 3. The act is amended by adding a section to read:

18Section 504.1. Senior citizen tax relief.

19(a) Tax freeze.--Notwithstanding any other law, an eligible
20claimant shall be entitled to a freeze of school property taxes
21imposed by a school district on the person's homestead and shall
22not be required to pay any increases in those school property
23taxes in excess of the claimant's base payment.

24(b) Application.--An eligible claimant must apply for the
25tax freeze under subsection (a) by filing the following with the
26school district imposing the school property tax on a form
27prescribed by the department:

28(1) A request for the tax freeze and a copy of the most
29recent school property tax bill.

30(2) Certification that the claimant or the claimant's

1spouse is the owner of the homestead upon which the school
2property taxes are imposed.

3(3) Receipts showing prompt payment of the current
4year's school property tax liability.

5(c) Timing.--

6(1) The application under subsection (b) must be filed
7within 45 days of the date the school property tax under
8subsection (b)(1) is due.

9(2) Within 15 days of receipt of an application, the
10school district shall determine the claimant to be eligible
11or ineligible. A determination of ineligibility under this
12paragraph is subject to 2 Pa.C.S. Ch. 7 Subch. B (relating to
13judicial review of local agency action).

14(d) Termination.--

15(1) Subject to paragraph (2), the tax rate on and the
16assessment of school property tax shall become current on the
17sale or transfer of the real property subject to the tax,
18including any transfer under a recorded real property sales
19contract.

20(2) A tax freeze under this section shall remain in
21effect upon the transfer of the affected real property to a
22surviving spouse if, at the time of the death of the
23claimant, the surviving spouse is at least 65 years of age or
24will be 65 years of age within six months of the date of
25death of the claimant.

26(e) Commonwealth payment.--

27(1) Beginning April 2013 and each April thereafter, the
28secretary shall pay school districts, from the fund, the
29amount of each eligible claimant's increase in school
30property taxes in excess of the claimant's base payment.

1Payments under this section shall be made prior to any
2distribution of funds under subsection 504(c).

3(2) The school district shall provide notification and
4documentation to the department of the total balance due to
5the local taxing authorities for increases in school property
6tax for eligible claimants.

7(3) The department shall certify the total amount due to
8increase in school property tax for each school district.

9(f) Definitions.--The following words and phrases when used
10in this section shall have the meanings given to them in this
11subsection unless the context clearly indicates otherwise:

12"Base payment."

13(1) Except as set forth in paragraph (2), the amount of
14school property tax paid by the eligible claimant either in
15the tax year beginning January 1, 2013, or in the first tax
16year during which the claimant first becomes eligible,
17whichever occurs later, on the principal residence in which
18the claimant has maintained continuous occupancy and
19ownership since either January 1, 2013, or the date the
20claimant first becomes eligible.

21(2) If the claimant purchases a principal residence
22after January 1, 2013, or after the date upon which the
23claimant first becomes eligible, the amount of school
24property tax paid during the tax year in which the purchase
25was made.

26"Base year." The tax year under paragraph (1) or (2) of the
27definition of "base payment."

28"Eligible claimant." An individual who meets all of the
29following for the base year and each succeeding year up to and
30including the year for which the freeze is sought:

1(1) Was at least 65 years of age or whose spouse, if a
2member of the household, was at least 65 years of age during
3the base year.

4(2) Has held a homestead exemption for the previous five
5years.

6(3) Has paid the full amount of property taxes due for
7each succeeding year up to and including the year for which
8the freeze is sought.

9"Homestead." As defined in section 302.

10"School property tax." The property tax levied by a school
11district on the homestead of an eligible claimant. The term does
12not include a penalty, interest or a payment made in lieu of
13tax.

14"School property tax increase." The increase in school
15property tax levied in a calendar year over school property tax
16levied in the base year.

17Section 4. Section 505(a) of the act is amended by adding a
18paragraph and the section is amended by adding a subsection to
19read:

20Section 505. State property tax reduction allocation.

21(a) Administration.--The department shall do all of the
22following:

23* * *

24(2.1) Prior to calculating the property tax reduction 
25under paragraph (3), the department shall calculate the 
26amount due to school districts under section 504.1.

27* * *

28(a.1) Initial payment.--For the fiscal year commencing July
291, 2013, and July 1 of each year thereafter, prior to making a
30payment under subsection (b), the department shall pay to each

1school district the amount due under section 504.1(e).

2* * *

3Section 5. This act shall take effect immediately.