1Authorizing countywide implementation of sales, use, occupancy,
2personal income or earned income and net profits taxes;
3providing for the levying, assessment, collection and
4distribution of such taxes among municipalities within a
5county; requiring reduction of other taxes on real property
6and individuals; and providing for the powers and duties of
7the Department of Community and Economic Development, the
8Department of Revenue and the State Treasurer.

9TABLE OF CONTENTS

10Chapter 1. General Provisions

11Section 101. Short title.

12Section 102. Definitions.

13Section 103. Scope and limitations.

14Section 104. Home rule counties.

15Section 105. Certain rates of taxation limited.

16Chapter 3. Subjects of Taxation

17Subchapter A. Tax Authorization

18Section 301. General tax authorization.

19Section 302. Continuity of tax.

20Section 303. Election to participate under act.

21Section 304. Municipal input into participation.

1Subchapter B. County Sales and Use Tax

2Section 311. Construction.

3Section 312. Imposition.

4Section 313. Situs.

5Section 314. Licenses.

6Section 315. Rules and regulations; collection costs.

7Section 316. Procedure and administration.

8Section 317. County sales and use tax funds.

9Section 318. Disbursements.

10Subchapter C. Personal Income Tax

11Section 321. Construction.

12Section 322. Personal income tax.

13Section 323. Collections.

14Section 324. Rules and regulations.

15Section 325. Procedure and administration.

16Subchapter D. Earned Income and Net Profits Tax

17Section 331. Earned income and net profits tax.

18Section 332. Collections.

19Section 333. Rules and regulations.

20Section 334. Procedure and administration.

21Subchapters E through I (Reserved)

22Chapter 5. Credits, Exemptions and Deferrals

23Subchapter A. Credits and Exemptions

24Section 501. Credits.

25Section 502. Low-income tax provisions.

26Section 503. Regulations.

27Subchapter B. Real Estate Tax Deferral

28Section 511. Legislative intent.

29Section 512. Definitions.

30Section 513. Authority.

1Section 514. Income eligibility.

2Section 515. Tax deferral.

3Section 516. Application procedure.

4Section 517. Contents of application.

5Section 518. Attachment and satisfaction of liens.

6Subchapters C through J (Reserved)

7Chapter 7. Disposition and Use of Tax Revenues

8Section 701. Use of sales tax revenues.

9Section 702. Use of personal or earned income tax revenues.

10Section 703. Revenue limitation exceptions.

11Section 704. Methods of reducing real property tax.

12Section 705. Estimates of distributions and revenues.

13Chapter 9. Register for Certain Taxes

14Section 901. Definitions.

15Section 902. Register for taxes under this act.

16Section 903. Information for register.

17Section 904. Availability and effective period of register.

18Section 905. Effect of nonfiling.

19Section 906. Effect of chapter on liability of taxpayer.

20Chapter 17. Miscellaneous Provisions

21Section 1701. Effective date.

22The General Assembly of the Commonwealth of Pennsylvania
23hereby enacts as follows:

24CHAPTER 1

25GENERAL PROVISIONS

26Section 101. Short title.

27This act shall be known and may be cited as the Balanced
28Options - Local Decisions Act.

29Section 102. Definitions.

30The following words and phrases when used in this act shall

1have the meanings given to them in this section unless the
2context clearly indicates otherwise:

3"Association." As defined in section 301 of the act of March
44, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

5"Board of county commissioners." Includes the successor in
6function to the board of county commissioners in a county that
7has adopted a home rule charter under the former act of April
813, 1972 (P.L.184, No.62), known as the Home Rule Charter and
9Optional Plans Law, but does not include the city council of a
10city of the first class.

11"Budgeted revenue." The revenue from taxes actually levied
12and assessed by a local government unit. The term does not
13include revenue from:

14(1) Delinquent taxes.

15(2) Payments in lieu of taxes.

16(3) The real estate transfer tax.

17(4) The Public Utility Realty Tax, commonly known as
18PURTA.

19(5) Interest or dividend earnings.

20(6) Federal or State grants, contracts or
21appropriations.

22(7) Income generated from operations.

23(8) Any other source that is revenue not derived
24directly from taxes levied and assessed by a local government
25unit.

26"Business." As defined in section 301 of the act of March 4,
271971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

28"Classes of income." The classes of income set forth in
29section 303 of the act of March 4, 1971 (P.L.6, No.2), known as
30the Tax Reform Code of 1971.

1"Compensation." As defined in section 301 of the act of
2March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
31971.

4"County." A county-level municipality within this
5Commonwealth, regardless of classification. The term includes a
6county that has adopted a home rule charter or optional plan of
7government under the former act of April 13, 1972 (P.L.184,
8No.62), known as the Home Rule Charter and Optional Plans Law.
9The term does not include a county of the first or second class.

10"Current year." The calendar year or fiscal year for which
11the tax is levied.

12"Department." The Department of Revenue of the Commonwealth.

13"Domicile." As defined in section 501 of the act of December
1431, 1965 (P.L.1257, No.511), known as The Local Tax Enabling
15Act.

16"Earned income." The classes of income defined as earned
17income in section 501 of the act of December 31, 1965 (P.L.1257,
18No.511), known as The Local Tax Enabling Act.

19"Employer." As defined in section 301 of the act of March 4,
201971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

21"Governing body." The board of county commissioners,
22including the successor in function to the board of county
23commissioners in a county which has adopted a home rule charter
24under the former act of April 13, 1972 (P.L.184, No.62), known
25as the Home Rule Charter and Optional Plans Law, city council,
26borough council, incorporated town council, board of township
27commissioners, board of township supervisors, a governing
28council of a home rule municipality or optional plan
29municipality or a governing council of any similar general
30purpose unit of government which may hereafter be created by

1statute.

2"Home rule municipality." A city, borough, incorporated town
3or township that has adopted a home rule charter under the
4former act of April 13, 1972 (P.L.184, No.62), known as the Home
5Rule Charter and Optional Plans Law.

6"Individual." As defined in section 301 of the act of March
74, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

8"Inverse per capita income." A factor determined by dividing
9the integer one by the per capita income of the municipality, as
10determined by the most recent survey by the Department of
11Commerce.

12"Local Tax Enabling Act." The act of December 31, 1965
13(P.L.1257, No.511), known as The Local Tax Enabling Act.

14"Municipality." A city of the second class A, city of the
15third class, borough, incorporated town, township of the first
16class, township of the second class, home rule municipality,
17optional plan municipality, optional form municipality or
18similar general purpose unit of government that may be created
19by statute, except a city of the first or second class.

20"Net profits." The classes of income defined as net profits
21in section 501 of the act of December 31, 1965 (P.L.1257,
22No.511), known as The Local Tax Enabling Act.

23"Nonresident." An individual domiciled outside the
24municipality.

25"Optional form municipality." A city that has adopted an
26optional form of government under the act of July 15, 1957
27(P.L.901, No.399), known as the Optional Third Class City
28Charter Law.

29"Optional plan municipality." A city, borough, incorporated
30town or township that has adopted an optional plan of government

1under the former act of April 13, 1972 (P.L.184, No.62), known
2as the Home Rule Charter and Optional Plans Law.

3"Ordinance." Includes a resolution.

4"Personal income." The classes of income enumerated in
5section 303 of the act of March 4, 1971 (P.L.6, No.2), known as
6the Tax Reform Code of 1971, and upon which is imposed a
7personal income tax by the Commonwealth.

8"Preceding year." The calendar year or fiscal year before
9the current year.

10"Register." The register provided for in Chapter 9.

11"Resident individual." An individual who is domiciled in a
12municipality or county.

13"School district." A school district of the first class A,
14second class, third class or fourth class, including any
15independent school district.

16"Succeeding year." The calendar year or fiscal year
17following the current year.

18"Tax base." The collective value of activities, property and
19assets available for taxation.

20"Tax officer." The person, public employee or private agency
21designated by a governing body to collect and administer the
22taxes imposed under this act.

23"Tax Reform Code." The act of March 4, 1971 (P.L.6, No.2),
24known as the Tax Reform Code of 1971.

25"Taxpayer." An individual required under this act to file a
26tax return or to pay a tax.

27Section 103. Scope and limitations.

28(a) General rule.--Except as provided in subsections (b),
29(c), (d) and (e), it is the intent of this act to confer upon
30each county the power to levy, assess and collect taxes upon the

1subjects of taxation set forth in this act.

2(b) Real estate transfer taxes.--This act does not affect
3the powers of a municipality or school district to levy, assess
4and collect a real estate transfer tax, including any real
5estate transfer tax levied under the authority of section
6652.1(a)(4) of the act of March 10, 1949 (P.L.30, No.14), known
7as the Public School Code of 1949.

8(c) Amusement taxes.--A municipality or school district
9within a county that has elected to participate under section
10303 and has lawfully levied, assessed or collected or provided
11for the levying, assessment or collection of an amusement tax
12may continue to levy, assess and collect an amusement tax on the
13subjects upon which the tax was imposed at a rate not to exceed
14the rate imposed by the municipality or school district as of
15the effective date of this act. No new amusement taxes may be
16imposed by a municipality or school district within a county
17that has elected to participate under this act.

18(d) Mercantile or business privilege taxes on gross
19receipts.--Nothing in this act may, either explicitly or
20implicitly, permit a county, municipality or school district to
21impose, expand the subjects of or increase the rate of any
22mercantile or business privilege tax on gross receipts not
23otherwise permitted prior to the effective date of this act, nor
24shall any provision of this act affect the prohibitions on
25business gross receipts taxes as set forth in section 301.1 of
26the Local Tax Enabling Act, section 533 of the act of December
2713, 1988 (P.L.1121, No.145), known as the Local Tax Reform Act,
28the Tax Reform Code and any other relevant act.

29(e) Sign or sign privilege tax.--Any county or municipality
30that has on or before January 1, 2011, assessed, levied or

1collected an annual sign tax or annual sign privilege tax or
2provided for the levying, assessment or collection of that tax
3may continue to levy, assess and collect such tax on such
4subjects upon which the tax was imposed by the county or
5municipality at a rate not to exceed the rate imposed by the
6county or municipality as of January 1, 2011. A county or
7municipality that does not assess, levy or collect an annual
8sign tax or annual sign privilege tax as of January 1, 2011, may
9not assess, levy or collect that tax.

10Section 104. Home rule counties.

11The governing body of a home rule county that desires to
12participate under this act shall be subject to the requirements
13of section 303. A home rule county may not have the right or
14authority to fix the rate of taxation for the subjects of
15taxation authorized under Chapter 3 in excess of the rates fixed
16in Chapter 3. Home rule counties that elect to participate under
17the provisions of this act shall be subject to the distribution
18provisions of sections 701 and 702.

19Section 105. Certain rates of taxation limited.

20(a) General rule.--If a municipality and school district
21both impose an earned income tax on the same individual under
22the Local Tax Enabling Act and the municipality and school
23district are limited to, or have agreed upon, a division of the
24tax rate in accordance with section 311 of the Local Tax
25Enabling Act, then the municipality and school district that
26continue to levy the income tax under the Local Tax Enabling Act
27shall remain subject to that limitation or agreement.

28(b) Limitation.--In the event that a school district opts to
29impose or increase an earned income tax under the Local Tax
30Enabling Act within a county that has elected to participate

1under this act, the school district shall remain subject to the
2provisions of section 311 of the Local Tax Enabling Act, or any
3agreement pertaining to the division of the tax rate with
4affected municipalities.

5CHAPTER 3

6SUBJECTS OF TAXATION

7SUBCHAPTER A

8TAX AUTHORIZATION

9Section 301. General tax authorization.

10(a) General rule.--Subject to sections 303 and 304 and
11except as provided in subsection (b), a county of the third
12through eighth class shall have the power and may by ordinance
13levy, assess and collect or provide for the levying, assessment
14and collection of such taxes on the subjects specified in this
15chapter for general revenue purposes as it shall determine on
16any or all of the subjects of taxation set forth in this act
17within the geographical limits of the county.

18(b) Exclusions.--No county, or any municipality within the
19county that levies a tax authorized by this act, may have any
20power or authority to levy, assess or collect:

21(1) A tax based upon a flat rate or on a millage rate on
22an assessed valuation of a particular trade, occupation or
23profession, commonly known as an occupation tax.

24(2) A tax at a set or flat rate upon persons employed
25within the taxing district, commonly known as an occupational
26privilege tax.

27(3) A per capita, poll, residence or similar head tax.

28(4) A new, or an increase in any existing, earned income
29and net profits tax levied under the Local Tax Enabling Act.

30(5) Any other tax authorized or permitted under the

1Local Tax Enabling Act except a local services tax, an
2amusement tax in effect prior to the effective date of this
3act, or a mercantile or business privilege tax on gross
4receipts, as modified by paragraph (7).

5(6) The intangible personal property tax under the act
6of June 17, 1913 (P.L.507, No.335), referred to as the
7Intangible Personal Property Tax Law.

8(7) Any mercantile or business privilege tax on gross
9receipts, as limited by section 533 of the act of December
1013, 1988 (P.L.1121, No.145), known as the Local Tax Reform
11Act, after one year from the date of the election to
12participate under this act pursuant to section 303.

13Section 302. Continuity of tax.

14Every tax levied under the provisions of this act shall
15continue in force on a calendar or fiscal year basis, as the
16case may be, without annual reenactment unless the rate of tax
17is lawfully increased or the tax is subsequently repealed.

18Section 303. Election to participate under act.

19(a) General rule.--The imposition of a tax under Subchapter
20B, C or D shall only be done in accordance with this section.

21(b) Tax study commission.--Before a county or municipalities
22in a county seek referendum approval for the levy, assessment or
23collection of any tax under the authority of this act, a local
24tax study commission shall be appointed in accordance with the
25following provisions:

26(1) The local tax study commission shall consist of
27members appointed by the governing body of the county in
28consultation with municipal officials within the county. No
29member of the local tax study commission may be a relative,
30by blood or marriage, of an official or employee of the

1county or a municipality therein. All members must be
2residents of the county. The local tax study commission shall
3consist of seven members. Representatives on a local tax
4study commission must reasonably reflect the socioeconomic,
5age and occupational diversity of the county.

6(2) The governing body of the county shall provide
7necessary and reasonable staff to support the local tax study
8commission and shall reimburse the members of the local tax
9study commission for necessary and reasonable expenses in the
10discharge of their duties.

11(3) The local tax study commission shall study the
12existing taxes levied, assessed and collected by the county
13and the municipalities in the county and the effect of any
14county or municipal taxes imposed concurrently with a school
15district and shall determine if and how the tax policies of
16the county and its municipalities could be strengthened or
17made more equitable by adopting for levy, assessment and
18collection a different combination of any of the following
19taxes: personal income tax, earned income and net profits
20tax, real estate tax or sales and use tax at such levels and
21in such combinations on permissible subjects of taxation as
22do not exceed the limitations in this act. This study shall
23include, but not be limited to, consideration of all of the
24following:

25(i) Historic rate and revenue provided by taxes
26currently levied, assessed and collected by the county
27and the municipalities therein.

28(ii) The percentage of total revenues provided by
29taxes currently levied, assessed and collected.

30(iii) The age, income, employment and property use

1characteristics of the existing tax base.

2(iv) The projected revenues of any taxes currently
3levied, assessed and collected.

4(v) The projected revenues of any taxes referred to
5in this paragraph not currently levied, assessed and
6collected by the municipality or county.

7(4) Within 120 days of its appointment, the local tax
8study commission shall submit a nonbinding recommendation to
9the county and its municipalities with regard to the
10appropriate tax or combination of taxes, identified in
11paragraph (3), to be levied, assessed and collected
12commencing the next fiscal year. No later than 60 days after
13submission of the recommendation, the governing body of the
14county shall accept or reject the recommendation of the local
15tax study commission.

16(5) If the local tax study commission fails to make a
17nonbinding recommendation within 120 days of its appointment,
18the governing body of the county shall discharge the
19appointed local tax study commission and may appoint itself
20as the local tax study commission or may propose the adoption
21of a combination of taxes for the county and its
22municipalities for the next fiscal year.

23(6) The local tax study commission shall publish or
24cause to be published, concurrent with issuing its
25recommendation, a final report of its activities and
26recommendations and shall deliver the final report to the
27governing bodies of the county and municipalities in the
28county. The local tax study commission shall be subject to 65
29Pa.C.S. Ch. 7 (relating to open meetings) and the act of
30February 14, 2008 (P.L.6, No.3), known as the Right-to-Know

1Law.

2(7) Receipts are required for all reimbursable expenses
3under paragraph (2).

4(8) The records, receipts, tapes, minutes of meetings
5and written discussions of the local tax study commission
6shall, upon its discharge, be turned over to the secretary or
7chief clerk of the county for permanent safekeeping. The
8secretary or chief clerk shall make those materials available
9for public inspection at any time during regular business
10hours.

11(9) The local tax study commission shall be discharged
12upon the filing of its final report.

13(c) Public referendum requirements to participate under
14act.--Subject to the notice and public hearing requirements of
15section 316(a), 325(a) or 334, whichever is applicable, a
16governing body may elect to participate under this act by
17obtaining the approval of the electorate of the affected county
18and its municipalities in a public referendum at only the
19municipal or general primary election preceding the calendar
20year or fiscal year when the taxes will be initially imposed.
21The referendum question must state the initial rate of the
22proposed tax, the reason for the tax and the amount of proposed
23revenue growth, if any, in the fiscal year of transition to the
24tax system authorized under this act, expressed as a percent
25increase over the prior year's budgeted revenue. Any increase in
26revenues between the transition year and the prior year's
27budgeted revenue shall not exceed 2%. The governing body must
28frame the question in clear language that is readily
29understandable by the layperson. For the purpose of
30illustration, a referendum question could be framed as follows:

1Do you favor the imposition of an X% (name of tax) to be used
2to replace certain existing local taxes and to make
3reductions in real property taxes by means of a homestead
4exemption in the amount of Y?

5A nonlegal interpretative statement must accompany the question
6in accordance with section 201.1 of the act of June 3, 1937
7(P.L.1333, No.320), known as the Pennsylvania Election Code,
8that includes all of the following:

9(1) The initial rate of the tax or taxes to be imposed
10and the maximum allowable rate of the tax or taxes imposed
11under this act.

12(2) The estimated revenues to be derived from the
13initial rate of the tax or taxes imposed under this act in
14the fiscal year of transition to the tax system authorized
15under this act.

16(3) The estimated tax savings from the reduction in real
17property taxes and the elimination of certain existing taxes
18under this act.

19(4) The identification of the existing taxes to be
20eliminated under this act.

21(5) The method or methods to be used to reduce real
22property taxes.

23(6) The class or classes of real property for which real
24property taxes would be reduced.

25(7) The estimated amount of real property tax reduction
26by class, expressed as an average percent reduction by class,
27if applicable.

28(d) Existing taxes.--If a referendum under this section
29fails to win majority approval of the electorate, a county or
30municipality shall not be required to seek the approval of the

1electorate as a prerequisite to an increase in the rate of any
2tax which the governing body of the affected county or
3municipality is already authorized to levy and increase under
4any other act.

5Section 304. Municipal input into participation.

6(a) Decision to participate.--After the first January 1
7occurring at least six months following the effective date of
8this section, if the board of county commissioners of a county
9has not elected to participate under this act, municipalities
10located in that county may require, as provided in this section,
11the board of county commissioners of the county to establish a
12local tax study commission under section 303. The affirmative
13votes of the governing bodies of municipalities whose combined
14population represents more than 60% of the population within the
15county shall be necessary to require the board of county
16commissioners to elect participation under this act. The
17population of a municipality that is located in more than one
18county shall be determined separately for each county where the
19municipality is located on the basis of the municipality's
20population within each county.

21(b) Decision not to participate.--If the board of county
22commissioners of a county has elected to participate under this
23act, municipalities located in that county may, at any time
24prior to a final vote by the county commissioners under section
25303(b)(4) or (5), submit a resolution passed by the
26municipality's governing body to the board of county
27commissioners of the county indicating the municipality's desire
28to reject participation under this act. If the county receives
29duly passed resolutions from municipalities whose combined
30population represents 60% of the county's population, a county

1shall reject participation and no referendum may be placed
2before the electorate.

3(c) Procedure.--

4(1) Each governing body of a municipality voting in the
5affirmative on the question shall certify its vote on the
6question to the board of county commissioners. The governing
7body of a municipality that is located in more than one
8county shall certify its vote on the question to the board of
9county commissioners for each county where the municipality
10is located.

11(2) The affirmative votes of the governing bodies of
12municipalities whose combined population represents more than
1360% of the population within the county shall be necessary
14for the board of county commissioners to be required to elect
15or reject participation under this act. The population of a
16municipality that is located in more than one county shall be
17determined separately for each county where the municipality
18is located on the basis of the municipality's population
19within each county.

20(3) Immediately upon receipt of certifications
21indicating the approval of resolutions by municipalities
22whose combined population represents more than 60% of the
23population of the county, the board of county commissioners
24of the county shall either elect to participate and initiate
25the procedures under section 303 or reject participation
26under this section, in accordance with the decision contained
27in those resolutions which represent more than 60% of the
28population of the county.

29SUBCHAPTER B

30COUNTY SALES AND USE TAX

1Section 311. Construction.

2The tax imposed by the governing body of a county under this
3subchapter shall be in lieu of imposing taxes under sections 322
4and 331 and in addition to any tax imposed by the Commonwealth
5under Article II of the Tax Reform Code. Except for the situs
6provisions under section 313, the provisions of Article II of
7the Tax Reform Code shall apply to the tax.

8Section 312. Imposition.

9(a) Sales.--The governing body of a county of the third
10through eighth class may levy and assess upon each separate sale
11at retail of tangible personal property or services, as defined
12in Article II of the Tax Reform Code, within the boundaries of
13the county, a tax on the purchase price. The tax shall be
14collected by the vendor from the purchaser and shall be paid
15over to the Commonwealth as provided in this subchapter. The
16sales tax shall not be paid to the Commonwealth by any person
17who has paid the tax imposed under Chapter 5 of the act of June
185, 1991 (P.L.9, No.6), known as the Pennsylvania
19Intergovernmental Cooperation Authority Act for Cities of the
20First Class, or subdivision (e) of Article XXXI-B of the act of
21July 28, 1953 (P.L.723, No.230), known as the Second Class
22County Code, equal to or greater than the tax imposed under this
23subsection.

24(b) Use.--In any county, except for a county of the first or
25second class, within which the tax authorized in subsection (a)
26is imposed, there shall be levied, assessed and collected upon
27the use, within the county, of tangible personal property
28purchased at retail and on services purchased at retail, as
29defined in Article II of the Tax Reform Code, a tax on the
30purchase price. The tax shall be paid over to the Commonwealth

1by the person who makes the use. The use tax imposed under this
2subchapter shall not be paid over to the Commonwealth by any
3person who has paid the tax imposed under:

4(1) Subsection (a).

5(2) This subsection to the vendor with respect to the
6use.

7(3) Chapter 5 of the Pennsylvania Intergovernmental
8Cooperation Authority Act for Cities of the First Class,
9equal to or greater than the tax imposed under either
10subsection (a) or this subsection.

11(4) Subdivision (e) of Article XXXI-B of the Second
12Class County Code equal to or greater than the tax imposed
13under either subsection (a) or this subsection.

14(c) Occupancy.--In any county within which a tax authorized
15by subsection (a) is imposed, there shall be levied, assessed
16and collected an excise tax on the rent upon every occupancy of
17a room or rooms in a hotel in the county. The tax shall be
18collected by the operator or owner from the occupant and paid
19over to the Commonwealth.

20(d) Rate and uniformity.--

21(1) The tax authorized by subsections (a), (b) and (c)
22shall be imposed at a rate not to exceed 1%.

23(2) The tax imposed by subsections (a), (b) and (c)
24shall be uniform.

25(e) Computation.--The tax imposed under this section shall
26be computed in the manner set forth in section 503(e)(2) of the
27Pennsylvania Intergovernmental Cooperation Authority Act for
28Cities of the First Class.

29Section 313. Situs.

30(a) General rule.--Except as provided in subsection (b), the

1situs of sales at retail or uses, including leases, of motor
2vehicles, aircraft, motorcraft and utility services shall be
3determined in the manner specified by section 504 of the act of
4June 5, 1991 (P.L.9, No.6), known as the Pennsylvania
5Intergovernmental Cooperation Authority Act for Cities of the
6First Class, as well as the Tax Reform Code of 1971.

7(b) Premium cable and telecommunications services.--The sale
8or use of premium cable or telecommunications service shall be
9deemed to occur at the address in the county where the customer
10receives the bill for service. This subsection shall determine
11the situs of premium cable service for the purpose of all county
12sales taxes, including those imposed under Chapter 5 of the
13Pennsylvania Intergovernmental Cooperation Authority Act for
14Cities of the First Class and under subdivision (e) of Article
15XXXI-B of the act of July 28, 1953 (P.L.723, No.230), known as
16the Second Class County Code.

17Section 314. Licenses.

18A license for the collection of the tax imposed by this
19subchapter shall be issued in the same manner as is provided for
20in section 505 of the act of June 5, 1991 (P.L.9, No.6), known
21as the Pennsylvania Intergovernmental Cooperation Authority Act
22for Cities of the First Class. Licensees shall be entitled to
23the same discount as provided in section 227 of the Tax Reform
24Code.

25Section 315. Rules and regulations; collection costs.

26(a) Regulations.--Rules and regulations shall be applicable
27to the taxes imposed under section 312 in the same manner as is
28provided for in section 506(1) and (2) of the act of June 5,
291991 (P.L.9, No.6), known as the Pennsylvania Intergovernmental
30Cooperation Authority Act for Cities of the First Class.

1(b) Administrative costs.--The department, to cover its
2costs of administration, may retain a sum equal to the costs of
3administration. When the annual operating budget for the
4department is submitted to the General Assembly, the department
5shall also submit to the chairman and minority chairman of the
6Appropriations Committee of the Senate and to the chairman and
7minority chairman of the Appropriations Committee of the House
8of Representatives a report of the actual sums retained for
9costs of collection in the preceding fiscal year, together with
10all supporting details.

11Section 316. Procedure and administration.

12(a) Ordinance.--Any county authorized to impose the tax
13under section 312 shall give at least 60 days' written notice to
14every municipality and school district located in the county of
15its intent to impose the tax and shall adopt an ordinance after
16the expiration of 60 days after the date of the notice. The
17notice and an ordinance shall state the tax rate and refer to
18this subchapter. The ordinance shall authorize the imposition of
19all taxes provided for in section 312. Prior to adopting an
20ordinance imposing the tax authorized by section 312, the
21governing body of the county shall give public notice of its
22intent to adopt the ordinance in the manner provided by section
23306 of the Local Tax Enabling Act and shall conduct at least one
24public hearing regarding the proposed adoption of the ordinance.

25(b) Notification to department.--A certified copy of the
26county ordinance shall be delivered to the department by
27September 1 of the year prior to the effective date of the
28ordinance. The county ordinance shall become effective on
29January 1 of the following year.

30(c) Delivery of repeal ordinance.--A certified copy of any

1repeal ordinance shall be delivered to the department at least
230 days prior to the effective date of the repeal.

3Section 317. County sales and use tax funds.

4There is created for each county levying the tax under
5section 312 the (proper name) County Sales and Use Tax Fund. The
6State Treasurer shall be custodian of the funds that shall be
7subject to the provisions of law applicable to funds listed in
8section 302 of the act of April 9, 1929 (P.L.343, No.176), known
9as The Fiscal Code. Taxes imposed under section 312 shall be
10received by the department and paid to the State Treasurer and,
11along with interest and penalties, less any collection costs
12allowed under this subchapter and any refunds and credits paid,
13shall be credited to the funds not less frequently than every
14two weeks. During any period prior to the credit of moneys to
15the funds, interest earned on moneys received by the department
16and paid to the State Treasurer under this subchapter shall be
17deposited into the funds. All moneys in the funds, including,
18but not limited to, moneys credited to the funds under this
19section, prior year encumbrances and the interest earned
20thereon, shall not lapse or be transferred to any other fund,
21but shall remain in the funds. Pending their disbursement,
22moneys received on behalf of or deposited into the funds shall
23be invested or reinvested as are other moneys in the custody of
24the State Treasurer in the manner provided by law. All earnings
25received from the investment or reinvestment of the moneys shall
26be credited to the respective funds. The Auditor General shall
27periodically audit the records of the department relative to its
28duties under this section and shall furnish the results of the
29audit to any county levying the sales and use tax under section
30312 and to any municipality within the county upon its request.

1Section 318. Disbursements.

2(a) General rule.--On or before the tenth day of every
3month, the State Treasurer shall make the disbursements on
4behalf of the county imposing the tax out of the moneys which
5are, as of the last day of the previous month, contained in the
6respective county sales and use tax fund.

7(b) Disbursement to counties.--The State Treasurer shall
8disburse to a county imposing the tax authorized under section
9312 an amount of money equal to 50% of the tax collected in that
10county and remitted to the department and deposited in the
11respective county sales and use tax fund. The county shall
12deposit the revenue from the respective county sales and use tax
13fund into the county general fund for disposition as provided
14under section 701(a).

15(c) Disbursement to municipalities.--The State Treasurer
16shall, at the same time, disburse to the municipalities 50% of
17the tax collected in their respective counties as provided in
18subsection (d). Each municipality's portion shall be deposited
19in the municipal general fund for disposition as provided in
20section 701(b).

21(d) Allocation to municipalities.--The money allocated to
22municipalities in the county shall be distributed pro rata based
23on the population of each municipality located in the county as
24a percentage of the sum of the population of all municipalities
25located in the county. For municipalities located in more than
26one county, the population shall be determined separately for
27each county where the municipality is located on the basis of
28the municipality's population within each county.

29SUBCHAPTER C

30PERSONAL INCOME TAX

1Section 321. Construction.

2The tax imposed in a county under this subchapter shall be in
3lieu of imposing taxes under sections 312 and 331, and in
4addition to any tax imposed by the Commonwealth under Article
5III of the Tax Reform Code. In addition to the provisions in
6sections 501, 502 and 503, the provisions of Article III of the
7Tax Reform Code shall apply to the tax.

8Section 322. Personal income tax.

9Upon approval by referendum under this act, a county shall
10have the power to levy, assess and collect a tax on the personal
11income of resident individuals of the county up to a maximum
12rate of 1.5%, in increments of 0.25 of 1%.

13Section 323. Collections.

14A county imposing a tax under section 322 shall designate
15either the tax officer under the Local Tax Enabling Act or the
16Department of Revenue as the collector of the countywide
17personal income tax. In the performance of the tax collection
18duties under this subchapter, the designated tax officer shall
19have all the same powers, rights, responsibilities and duties
20for the collection of the taxes that may be imposed under the
21Local Tax Enabling Act or otherwise by law.

22Section 324. Rules and regulations.

23Taxes imposed under section 322 will be subject to the rules
24and regulations adopted by the department under Article III of
25the Tax Reform Code.

26Section 325. Procedure and administration.

27(a) Ordinance.--The governing body of the county, in order
28to impose the tax authorized by section 322, shall adopt an
29ordinance that shall refer to this subchapter. Prior to adopting
30an ordinance imposing the tax authorized by section 322, the

1governing body shall give public notice of its intent to adopt
2the ordinance in the manner provided in section 316, and shall
3conduct at least one public hearing regarding the proposed
4adoption of the ordinance.

5(b) Delivery.--A certified copy of the ordinance imposing
6the tax shall be delivered to the department no later than 90
7days prior to the effective date of the ordinance.

8(c) Delivery of repeal ordinance.--A certified copy of any
9repeal ordinance shall be delivered to the department at least
1030 days prior to the effective date of the repeal.

11SUBCHAPTER D

12EARNED INCOME AND NET PROFITS TAX

13Section 331. Earned income and net profits tax.

14If approved by referendum, and in lieu of imposing the taxes
15under sections 312 and 322, a county shall have the power to
16levy, assess and collect a tax on the earned income and net
17profits of resident individuals of the municipality up to a
18maximum rate of 1.5%, in increments of 0.25 of 1%. A county that
19imposes a tax under this subsection may not impose any tax under
20section 322.

21Section 332. Collections.

22A county imposing a tax under section 331 shall designate the
23tax officer who is appointed under the Local Tax Enabling Act as
24the collector of the earned income and net profits tax. In the
25performance of the tax collection duties under this subchapter,
26the designated tax officer shall have all the same powers,
27rights, responsibilities and duties for the collection of the
28taxes that may be imposed under the Local Tax Enabling Act or
29otherwise by law.

30Section 333. Rules and regulations.

1Taxes imposed under section 331 shall be subject to the rules
2and regulations under the Local Tax Enabling Act.

3Section 334. Procedure and administration.

4The governing body of the county, in order to impose the tax
5authorized by section 331, shall adopt an ordinance that shall
6refer to this subchapter. Prior to adopting an ordinance
7imposing the tax authorized by section 331, the governing body
8shall give public notice of its intent to adopt the ordinance in
9the manner provided by section 306 of the Local Tax Enabling
10Act, and shall conduct at least one public hearing regarding the
11proposed adoption of the ordinance.

12SUBCHAPTERS E THROUGH I (RESERVED)

13CHAPTER 5

14CREDITS, EXEMPTIONS AND DEFERRALS

15SUBCHAPTER A

16CREDITS AND EXEMPTIONS

17Section 501. Credits.

18The provisions of section 317 of the Local Tax Enabling Act
19shall be used to determine any credits under the provisions of
20this act for any taxes imposed under section 322 on the earned
21income portion of the personal income tax or section 331.

22Section 502. Low-income tax provisions.

23The provisions of section 304 of the Tax Reform Code shall be
24applied in any county which levies a tax under section 322 or
25331.

26Section 503. Regulations.

27Each county shall adopt regulations for the processing of
28claims under sections 501 and 502.

29SUBCHAPTER B

30REAL ESTATE TAX DEFERRAL

1Section 511. Legislative intent.

2In order to provide additional relief to residential property
3owners facing tax increases caused by changes in the millage
4rate, assessment rates or method or by a countywide
5reassessment, it is the intent of the General Assembly to create
6a program that will allow counties and municipalities to defer
7the increased portion of real property taxes when certain
8conditions are met.

9Section 512. Definitions.

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

13"Base payment." The amount of property tax paid by an
14applicant in the base year.

15"Base year." The tax year preceding the first tax year for
16which a taxing authority implements the provisions of this
17subchapter or the tax year immediately preceding an applicant's
18entry into the tax deferral program.

19"Claimant." A person who qualifies as a claimant under the
20provisions of the former act of March 11, 1971 (P.L.104, No.3),
21known as the Senior Citizens Rebate and Assistance Act, whether
22or not a claim is filed under that act and whose household
23income does not exceed the limit provided for in section 515.

24"Homestead." Real property that qualifies as a homestead
25under the provisions of the former act of March 11, 1971
26(P.L.104, No.3), known as the Senior Citizens Rebate and
27Assistance Act, except real property which is rented or leased
28to a claimant.

29"Household income." All income as defined in the former act
30of March 11, 1971 (P.L.104, No.3), known as the Senior Citizens

1Rebate and Assistance Act, received by the claimant and by the
2claimant's spouse while residing in the homestead during the
3calendar year for which a tax deferral is claimed.

4"Increases in property taxes." An increase in the property
5tax above the base payment, resulting from a millage increase, a
6change in the assessment ratio or method or any other reason.

7"Taxing authority." A county, city, borough, town or
8township in a county that has elected to participate under this
9act in accordance with section 303.

10Section 513. Authority.

11All taxing authorities shall have the power and authority to
12grant annual tax deferrals in the manner provided in this
13subchapter.

14Section 514. Income eligibility.

15(a) First year of enactment.--During the first calendar year
16this subchapter takes effect, a claimant shall be eligible for a
17tax deferral if the claimant has a household income of $15,000
18or less.

19(b) Subsequent years.--The amount of household income
20provided for in subsection (a) shall be increased by $500 each
21calendar year following the calendar year this subchapter takes
22effect.

23Section 515. Tax deferral.

24(a) Amount.--An annual real estate tax deferral granted
25under this subchapter shall equal the increase in real property
26taxes in excess of the claimant's base payment.

27(b) Prohibition.─No tax deferral may be granted if the total
28amount of deferred taxes, plus the total amount of all other
29unsatisfied liens on the homestead of the claimant, exceeds 85%
30of the market value of the homestead or if the outstanding

1principal on any and all mortgages on the homestead exceeds 70%
2of the market value of the homestead. Market value shall equal
3assessed value divided by the common level ratio as most
4recently determined by the State Tax Equalization Board for the
5county in which the property is located.

6Section 516. Application procedure.

7(a) Initial application.--A person eligible for a tax
8deferral under this subchapter may apply annually to the taxing
9authority. In the initial year of application, the following
10information shall be provided in the manner required by the
11taxing authority:

12(1) A statement of request for the tax deferral.

13(2) A certification that the applicant or the applicant
14and his or her spouse jointly are the owners in fee simple
15and residents of the property upon which the real property
16taxes are imposed.

17(3) A certification that the applicant's residence is
18adequately insured under a homeowner's policy to the extent
19of all outstanding liens.

20(4) Receipts showing timely payment of the immediately
21preceding year's nondeferred real property tax liability.

22(5) Proof of income eligibility under section 514.

23(b) Subsequent years.--After the initial entry into the
24program, a claimant shall remain eligible for tax deferral in
25subsequent years so long as the claimant continues to meet the
26eligibility requirements of this subchapter.

27Section 517. Contents of application.

28An application for a tax deferral distributed to persons
29shall contain the following:

30(1) A statement that the tax deferral granted under this

1subchapter is provided in exchange for a lien against the
2homestead of the applicant.

3(2) An explanation of the manner in which the deferred
4taxes shall become due, payable and delinquent and include,
5at a minimum, the consequences of noncompliance with the
6provisions of this subchapter.

7Section 518. Attachment and satisfaction of liens.

8(a) Nature of lien.--All taxes deferred under this
9subchapter shall constitute a prior lien on the homestead of the
10claimant in favor of the taxing authority and shall attach as of
11the date and in the same manner as other liens for taxes. The
12deferred taxes shall be collected as other liens for taxes, but
13the deferred taxes shall be due, payable and delinquent only as
14provided in subsection (b), and no interest may be collected on
15the lien.

16(b) Payment.--

17(1) All or part of the deferred taxes may at any time be
18paid to the taxing authority.

19(2) In the event that the deferred taxes are not paid by
20the claimant or the claimant's spouse during his or her
21lifetime or during their continued ownership of the property,
22the deferred taxes shall be paid either:

23(i) prior to the conveyance of the property to any
24third party; or

25(ii) prior to the passing of the legal or equitable
26title, either by will or by statute, to the heirs of the
27claimant or the claimant's spouse.

28(3) The surviving spouse of a claimant shall not be
29required to pay the deferred taxes by reason of his or her
30acquisition of the property due to death of the claimant as

1long as the surviving spouse maintains his or her residence
2in the property. The surviving spouse may continue to
3participate in the tax deferral program in subsequent years
4provided he or she is eligible under the provisions of this
5subchapter.

6SUBCHAPTERS C THROUGH J (RESERVED)

7CHAPTER 7

8DISPOSITION AND USE OF TAX REVENUES

9Section 701. Use of sales tax revenues.

10(a) Counties.--

11(1) In the fiscal year of implementation, each county
12that imposes a sales and use tax under this act shall use all
13revenues from the tax first to offset any lost revenue to the
14county from the taxes prohibited under section 301(b) in an
15amount equal to the revenue the county collected from the
16prohibited taxes in the immediately preceding fiscal year and
17then to reduce the county real property tax by means of:

18(i) The universal exemption or the homestead
19exemption.

20(ii) A reduction in the millage rate.

21(iii) A rent and tax rebate program modeled after
22the Commonwealth's Property Tax and Rent Rebate Program.

23(iv) Any combination of the options under the
24foregoing subparagraphs.

25(2) Reductions under paragraph (1) shall be done in
26accordance with section 704.

27(3) The department shall provide to each county that
28imposes a sales and use tax an estimate of the total dollar
29amount of revenue that the county can expect to receive from
30the county's share of the 1% county sales and use tax for the

1fiscal year of implementation. The department may charge the
2county for the actual costs of calculating the requested
3estimates. Guidelines concerning the costs shall be published
4in the Pennsylvania Bulletin. In the event the actual amount
5of sales and use tax revenue received by a county is less
6than the estimate of sales and use tax revenue provided by
7the department, the county may increase its real property tax
8millage rate to the level necessary to offset any shortfall
9resulting from an overestimation of sales and use tax
10revenue, as certified by the department, in the fiscal year
11of implementation.

12(b) Municipalities.--

13(1) All sales and use tax revenues received by any
14municipality shall be first used to offset any lost revenue
15from the taxes prohibited under section 301(b), and then used
16to reduce the municipal real property tax by means of:

17(i) The universal exemption or the homestead
18exemption.

19(ii) A reduction in the millage rate.

20(iii) A rent and tax rebate program modeled after
21the Commonwealth's Property Tax and Rent Rebate Program.

22(iv) Any combination of the options under the
23foregoing subparagraphs.

24(2) Reductions under paragraph (1) shall be done in
25accordance with section 704.

26(3) In the event the actual amount of sales and use tax
27revenue received by a municipality is less than the estimate
28of sales and use tax revenue provided by the department, the
29municipality may increase its real property tax millage rate
30to the level necessary to offset any shortfall resulting from

1an overestimation of sales and use tax revenue, as certified
2by the department, in the fiscal year of implementation.

3Section 702. Use of personal or earned income tax revenues.

4(a) Counties.--

5(1) For the fiscal year of implementation of a newly
6imposed income tax, all revenues received by a county shall
7first be used to offset any lost revenue to the county from
8the taxes prohibited under section 301(b) in an amount equal
9to the revenue the county collected from the prohibited taxes
10in the immediately preceding fiscal year and then to reduce
11the municipal real property tax by means of:

12(i) The universal exemption or the homestead
13exemption.

14(ii) A reduction in the millage rate.

15(iii) A rent and tax rebate program modeled after
16the Commonwealth's Property Tax and Rent Rebate Program.

17(iv) Any combination of the options under the
18foregoing subparagraphs.

19(2) Reductions under paragraph (1) shall be done in
20accordance with section 704.

21(b) Municipalities.--The disposition of revenue from an
22income tax or an increase in the rate of an income tax imposed
23by municipalities under the authority of this act shall occur in
24the following manner:

25(1) In a municipality that currently does not impose an
26income tax, all revenues received by the municipality shall
27first be used to offset any lost revenue to the municipality
28from the taxes prohibited under section 301(b) in an amount
29equal to the revenue the municipality collected from the
30prohibited taxes in the immediately preceding fiscal year and

1then to reduce the municipality's real property tax by means
2of:

3(i) The universal exemption or the homestead
4exemption.

5(ii) A reduction in the millage rate.

6(iii) A rent and tax rebate program modeled after
7the Commonwealth's Property Tax and Rent Rebate Program.

8(iv) Any combination of the options under the
9subparagraphs (i), (ii) and (iii).

10(2) Reductions under paragraph (1) shall be done in
11accordance with section 704.

12(3) In municipalities that currently impose an earned
13income tax, all revenues received by the municipality in
14excess of current revenue, including the existing earned
15income tax, shall first be used to offset lost revenue from
16the taxes prohibited under section 301(b), and then to reduce
17the municipality's real property tax by means of:

18(i) The universal exemption or the homestead
19exemption.

20(ii) A reduction in the millage rate.

21(iii) A rent and tax rebate program modeled after
22the Commonwealth's Property Tax and Rent Rebate Program.

23(iv) Any combination of the options under the
24foregoing subparagraphs.

25(4) Reductions under paragraph (1) shall be done in
26accordance with section 704.

27(c) Revenue estimates of department.--The department shall
28provide to each taxing jurisdiction that imposes an income tax
29under this act an estimate of the total dollar amount of revenue
30that the taxing jurisdiction can expect to receive from an

1income tax for the fiscal year of implementation. The department
2may charge the taxing jurisdiction for the actual costs of
3calculating the requested estimates. Guidelines concerning the
4costs shall be published in the Pennsylvania Bulletin. In the
5event the actual dollar amount of income tax revenue received by
6a taxing jurisdiction is less than the estimate of income tax
7revenue provided by the department, the taxing jurisdiction may
8increase its real property tax millage rate to the level
9necessary to offset any shortfall resulting from an
10overestimation of income tax revenue, as certified by the
11department, in the fiscal year of implementation.

12Section 703. Revenue limitation exceptions.

13(a) Exceptions listed.--The limitations in sections 312, 322
14and 331 may not be waived, except in the following cases:

15(1) To respond to or recover from an emergency or
16disaster declared under 35 Pa.C.S. Pt. V (relating to
17emergency management services), for the duration of the
18emergency or duration of the disaster or for the costs of the
19recovery from the emergency or disaster.

20(2) To implement a court order or an administrative
21decision of a Federal or State agency. In instances where the
22tax increase is necessary to respond to a court order or an
23administrative decision of a Federal or State agency
24requiring a temporary increase in local expenditures, the
25rate increase shall be rescinded following fulfillment of the
26court decision.

27(3) To respond to a Federal or State statute, regulation
28or order adding to or significantly altering responsibilities
29and duties or requiring expenditure of county or local funds
30to the extent not funded by the Federal or State Government.

1This provision shall apply only to a Federal or State
2statute, regulation or order taking effect after the
3effective date of this act.

4(b) Court action.--Prior to any waiver under subsection (a),
5approval is required by the court of common pleas in the
6judicial district in which the governing body is located. The
7following shall apply to any proceedings instituted under this
8subsection:

9(1) The governing body must prove by clear and
10convincing evidence the necessity for the waiver.

11(2) The court may retain continuing jurisdiction in
12these cases and may, on its own motion or on petition of an
13interested party, revoke approval for the waiver.

14(c) Distressed municipality or county.--This section shall
15not be construed to prohibit any municipality or county declared
16distressed under the act of July 10, 1987 (P.L.246, No.47),
17known as the Municipalities Financial Recovery Act, from
18petitioning the court of common pleas for a tax increase in
19accordance with section 123(c) of the Municipalities Financial
20Recovery Act.

21(d) Standing.--A taxpayer or business shall have standing as
22a party to a proceeding under this section as long as the
23taxpayer or business resides within or pays real property taxes
24to the taxing jurisdiction of the governing body instituting the
25action.

26Section 704. Methods of reducing real property tax.

27(a) General rule.--A county or municipality that levies or
28receives revenue from a county sales and use tax or an income
29tax under the provisions of this act may achieve the required
30reduction of the real property tax by exercising one or any

1combination of the options contained in the following
2paragraphs:

3(1) The taxing jurisdiction may exclude from taxation by
4means of the homestead exemption a fixed amount of the
5assessed value of each homestead property in the taxing
6jurisdiction within the limits, if any, imposed by Article
7VIII of the Constitution of Pennsylvania, as provided in
8subsection (b). The property tax shall be levied at the same
9millage rate as levied by the taxing jurisdiction for the
10fiscal year immediately preceding the year of implementation
11of the sales and use tax or income tax, as appropriate,
12imposed under this act.

13(2) The taxing jurisdiction may exclude from taxation by
14means of the universal exemption a fixed amount of the
15assessed value of each property in the taxing jurisdiction
16within the limits, if any, imposed by Article VIII of the
17Constitution of Pennsylvania. The property tax shall be
18levied at the same millage rate as levied by the taxing
19jurisdiction for the fiscal year immediately preceding the
20year of implementation of the sales and use tax or income
21tax, as appropriate, imposed under this act.

22(3) The taxing jurisdiction may reduce the millage rate
23of the real property tax generally to the same rate on all
24taxable real property. The reduction in millage rate shall be
25calculated based on the millage rate levied by the taxing
26jurisdiction for the fiscal year immediately preceding the
27year of implementation of the sales and use tax or income
28tax, as appropriate, imposed under this act.

29(4) The taxing jurisdiction may reduce the millage rate
30of the real property tax generally to the same rate on all

1taxable real property in combination with either the
2homestead exemption as provided under paragraph (1) or the
3universal exemption as provided under paragraph (2). The
4reduction in the real property millage rate shall be
5calculated based on the millage rate levied by the taxing
6jurisdiction for the fiscal year immediately preceding the
7year of implementation of the sales and use tax or income
8tax, as appropriate, imposed under this act.

9(b) Limitations.--

10(1) A taxing jurisdiction that elects to reduce the real
11property tax by means of the homestead exemption shall reduce
12the assessed value of each homestead in the taxing
13jurisdiction by a fixed amount established by its governing
14body up to the maximum limits contained in section 2(b) of
15Article VIII of the Constitution of Pennsylvania.

16(2) After a countywide revision of assessments within a
17county or municipality which has established a homestead
18exemption, the governing body of the taxing jurisdiction
19shall adjust the amount of the homestead exemption as
20follows:

21(i) if the county changes its assessment base by
22applying a change in the established predetermined ratio,
23the homestead exemption shall be adjusted by the percent
24change between the existing predetermined ratio and the
25newly established predetermined ratio; or

26(ii) if the county performs a countywide revision of
27assessments by revaluing all properties and applying an
28established predetermined ratio, the homestead exemption
29shall be adjusted by dividing the homestead exemption for
30the year preceding the countywide revision of assessments

1by the common level ratio and multiplying the quotient of
2that calculation by the newly established predetermined
3ratio.

4(3) If after reducing the real property tax by means of
5either the homestead exemption or the universal exemption
6there are any revenues remaining from a sales and use tax or
7income tax imposed under this act, the remaining revenues
8shall be used to further reduce the real property tax by
9means of a uniform reduction in the millage rate.

10(c) Definitions.--As used in this section, the following
11words and phrases shall have the meanings given to them in this
12subsection:

13"Common level ratio." The ratio of assessed value to current
14market value used generally in the county as last determined by
15the State Tax Equalization Board under the act of June 27, 1947
16(P.L.1046, No.447), referred to as the State Tax Equalization
17Board Law.

18"Established predetermined ratio." The ratio of assessed
19value to market value established by the board of county
20commissioners and uniformly applied in determining assessed
21value in any year.

22"Homestead." A dwelling, and as much of the land surrounding
23it as is reasonably necessary for the use of a dwelling as a
24home, occupied as the principal dwelling place by the owner or
25owners of the dwelling. The term also includes premises occupied
26by reason of ownership by individuals as defined in section 301
27of the Tax Reform Code. The term also includes premises occupied
28by reason of ownership in a cooperative housing corporation,
29mobile homes that are assessed as realty for local property tax
30purposes and the land, if owned by the person claiming the

1homestead property exemption upon which the mobile home is
2situated, and other similar living accommodations, as well as
3part of a multidwelling or multipurpose building and a part of
4the land on which it is built. The term also includes premises
5occupied by reason of ownership of a dwelling located on land
6owned by a nonprofit incorporated association of which the
7person claiming the homestead property exemption is a member, if
8the person is required to pay a pro rata share of the property
9taxes levied against the association's land. As used in this
10subsection, the term "owner" includes a person in possession
11under a contract of sale, deed of trust, life estate, joint
12tenancy or tenancy in common or by reason of statutes of descent
13or distribution.

14Section 705. Estimates of distributions and revenues.

15(a) General rule.--Estimates and proposed tax rates utilized
16by a county, municipality or local study commission shall be
17formulated so that in the fiscal year of implementation, the
18total budgeted revenues of a county or municipality, including
19the funds distributed under section 318, do not exceed the total
20budgeted revenues in the prior fiscal year. Increases in the tax
21base that occur as a natural result of social or economic
22factors, such as increases in property values, population,
23retail sales or other taxable activities, and not as a result of
24changes in rates of taxation, may be excluded from the
25formulation.

26(b) Refund of excess.--If, in the fiscal year of
27implementation, revenues from the taxes authorized by this act
28cause the total budgeted revenues of a county or municipality,
29including funds distributed under section 318, to exceed the
30budgeted revenues of the prior fiscal year by more than 2%, the

1county or municipality shall return the excess to the taxpayers
2and adjust its tax rates to comply with subsection (a) in the
3next fiscal year.

4(c) Use of excess.--If, in the fiscal year of
5implementation, a county's or municipality's total budgeted
6revenues do not exceed the prior fiscal year's budgeted revenues
7by more than 2%, any excess shall be used to retire debt or
8pension obligations of the government entity.

9CHAPTER 9

10REGISTER FOR CERTAIN TAXES

11Section 901. Definitions.

12The following words and phrases when used in this chapter
13shall have the meanings given to them in this section unless the
14context clearly indicates otherwise:

15"Department." The Department of Community and Economic
16Development of the Commonwealth.

17Section 902. Register for taxes under this act.

18(a) General rule.--It shall be the duty of the department to
19have available an official continuing register supplemented
20annually of all sales and use, personal income, earned income
21and net profits and municipal service taxes levied under this
22act.

23(b) Contents of register.--The register and its supplements
24shall list:

25(1) The counties or municipalities levying personal
26income tax, earned income and net profits tax or sales and
27use tax under this act.

28(2) The rate of tax as stated in the ordinance levying
29the tax.

30(3) The rate on taxpayers.

1(4) The name and address of the tax officer responsible
2for administering the collection of the tax and from whom
3information, forms for reporting and copies of rules and
4regulations are available.

5Section 903. Information for register.

6Information for the register shall be furnished by the chief
7clerk or secretary of each county or municipality to the
8department in such manner and on such forms as the department
9may prescribe. The information must be received by the
10department no later than July 15 of each year following the
11first year of imposition to show new tax enactments, repeals and
12changes. Failure to comply with this date for filing may result
13in the omission of the tax levy from the register for that year.
14Failure of the department to receive information of taxes
15continued without change may be construed by the department to
16mean that the information contained in the previous register
17remains in force.

18Section 904. Availability and effective period of register.

19The department shall have the register, with such annual
20supplements as may be required by new tax enactments, repeals or
21changes, available upon request no later than August 15 of each
22year. The effective period for each register shall be from July
231 of the year in which it is issued to June 30 of the following
24year.

25Section 905. Effect of nonfiling.

26Employers shall not be required by any ordinance to withhold
27from the compensation of their employees any personal income tax
28or earned income and net profits tax imposed under the
29provisions of this act that is not listed in the register or to
30make reports of compensation in connection with taxes not so

1listed. If the register is not available by August 15, the
2register of the previous year shall continue temporarily in
3effect for an additional period of not more than one year.

4Section 906. Effect of chapter on liability of taxpayer.

5The provisions of this chapter may not affect the liability
6of any taxpayer for taxes lawfully imposed under this act.

7CHAPTER 17

8MISCELLANEOUS PROVISIONS

9Section 1701. Effective date.

10This act shall take effect immediately.