1Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
2act relating to tax reform and State taxation by codifying
3and enumerating certain subjects of taxation and imposing
4taxes thereon; providing procedures for the payment,
5collection, administration and enforcement thereof; providing
6for tax credits in certain cases; conferring powers and
7imposing duties upon the Department of Revenue, certain
8employers, fiduciaries, individuals, persons, corporations
9and other entities; prescribing crimes, offenses and
10penalties," providing for the Pennsylvania port volume
11increase tax credit.

12The General Assembly of the Commonwealth of Pennsylvania
13hereby enacts as follows:

14Section 1. The act of March 4, 1971 (P.L.6, No.2), known as 
15the Tax Reform Code of 1971, is amended by adding an article to
16read:

17Article XVII-J

18Pennsylvania Port Volume Increase Tax Credit

19Section 1701-J. Short title.

20This article shall been known as the Pennsylvania Port Volume
21Increase Tax Credit Act.

22Section 1702-J. Definitions.

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

4"Base year." The calendar year prior to the taxable year.

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

7"Pass-through entity." A partnership as defined in section
8301(n.0) or a Pennsylvania S corporation as defined in section
9301(n.1).

10"Port cargo volume." The total amount of net tons of break-
11bulk cargo, roll on roll off cargo or containerized cargo
12measured in TEUs of cargo transported by way of a waterborne
13ship or vehicle through a port facility.

14"Port facility." A publicly or privately owned marine
15terminal located within this Commonwealth used or to be used in
16connection with the transportation or transfer of freight by way
17of a waterborne ship to or from international destinations
18outside this Commonwealth.

19"Qualified tax liability." The liability for taxes imposed
20under Articles III, IV or VI. The term shall not include any tax
21withheld by an employer from an employee under Article III.

22"Taxpayer." A person that is subject to tax under Article
23III, IV or VI. The term shall include the shareholder, owner or
24member of a pass-through entity that receives a tax credit.

25"Tax credit." The port volume tax credit authorized under
26this article.

27"TEU" or "20-foot equivalent unit." A volumetric measure
28based on the size of a container that is 20 feet long by eight
29feet wide by eight feet, six inches high.

30Section 1703-J. Tax credit.

1(a) Authorized.--A taxpayer that moves cargo through a port
2facility may apply for a credit against its qualified tax
3liability in accordance with this article.

4(b) Requirements.--The following shall apply to an
5application submitted by a taxpayer for a tax credit:

6(1) The tax credit may be claimed by the taxpayer only
7for cargo owned by the taxpayer at the time the port facility
8is used.

9(2) The amount of cargo moved by the taxpayer through a
10port facility for the taxable year for which the tax credit
11is sought is at least 90% of the amount of cargo moved by the
12taxpayer through a port facility in the base year, subject to
13the following:

14(i) The taxpayer may seek a waiver of the
15requirements of this paragraph by filing an application
16with the department.

17(ii) In reviewing the application for waiver, the
18department may take into account the circumstances that
19lead to the decrease in cargo; the future projection of
20cargo; the length of time the taxpayer has moved cargo
21through the port facility; and the history of the type of
22cargo moving through the port facility.

23(c) Amount of credit.--

24(1) A taxpayer that meets the requirements of this
25section and is awarded a tax credit shall receive a credit in
26the following amounts:

27(i) for container cargo: $50 for each TEU of
28containerized cargo;

29(ii) for break-bulk cargo: $50 per each 12-metric
30tons of break-bulk cargo; or

1(iii) for roll on roll off cargo:

2(A) $25 per each unit of equipment that weighs
3less than 10,000 pounds; or

4(B) $50 per each unit of equipment that weighs
510,000 pounds or more.

6(2) In addition to the credit authorized in paragraph
7(1), if a taxpayer increases the amount of cargo it moves
8through a port facility by more than 5% over the base year,
9the taxpayer shall be eligible for an additional credit based
10on the increased cargo above the amount of cargo moved in the
11base year. The authorized credit shall be in the following
12amounts:

13(i) for container cargo: $5 for each TEU of
14containerized cargo;

15(ii) for break-bulk cargo: $5 for every 12-metric
16tons of break-bulk cargo; or

17(iii) for roll on roll off cargo:

18(A) $2.50 per unit of equipment that weighs less
19than 10,000 pounds; or

20(B) $5 per unit of equipment that weighs 10,000
21pounds or more.

22(3) A qualifying taxpayer may not receive more than
23$250,000 in tax credits in a taxable year.

24Section 1704-J. Application.

25(a) Filing.--A taxpayer must submit an application to the
26department in a form and manner determined by the department.
27The application shall be developed by the department and shall
28include:

29(1) The amount of the port cargo volume for the taxable
30year stated both in net tons of break-bulk cargo, the number

1of units broken out by pieces below 10,000 pounds and 10,000
2pounds and above of roll on roll off cargo, or TEUs of
3containerized cargo.

4(2) The amount of port cargo volume for the base year
5stated both in net tons of break-bulk cargo, the number of
6units broken out by pieces below 10,000 pounds and 10,000
7pounds and above of roll on roll off cargo, or TEUs of
8containerized cargo.

9(3) The amount of any tax credit utilized by the
10taxpayer in prior years.

11(4) The amount of any tax credit carried over from prior
12years.

13(5) Any other information required by the department.

14(b) Submission and review.--

15(1) A taxpayer seeking a tax credit under this article
16shall submit an application to the department by March 1 of
17the calendar year after the calendar year in which the port
18cargo volume occurs.

19(2) The department shall authorize tax credits on a
20first-come, first-served basis.

21(c) Notification of Department of Revenue.--Upon approval of
22the application by the department, the department shall notify
23the Department of Revenue, which shall issue to an applicant a
24tax certificate that sets forth the amount of the tax credit
25approved for the eligible applicant.

26Section 1705-J. Carryover, carryback and assignment of credit.

27(a) General rule.--If the taxpayer cannot use the entire
28amount of the tax credit for the taxable year in which the tax
29credit is first approved, then the excess may be carried over to
30succeeding taxable years and used as a credit against the

1qualified tax liability of the taxpayer for those taxable years.
2Each time the tax credit is carried over to a succeeding taxable
3year, it shall be reduced by the amount that was used as a
4credit during the immediately preceding taxable year. The tax
5credit provided may be carried over and applied to succeeding
6taxable years for no more than three taxable years following the
7first taxable year for which the taxpayer was entitled to claim
8the credit.

9(b) Application.--A tax credit approved by the department in
10a taxable year first shall be applied against the taxpayer's
11qualified tax liability for the current taxable year as of the
12date on which the credit was approved before the tax credit can
13be applied against any tax liability under subsection (a).

14(c) No carryback or refund.--A taxpayer is not entitled to
15carry back or obtain a refund of all or any portion of an unused
16tax credit granted to the taxpayer.

17(d) Sale or assignment.--

18(1) A taxpayer, upon application to and approval by the
19department, may sell or assign, in whole or in part, a tax
20credit granted to the taxpayer.

21(2) The department and the Department of Revenue shall
22jointly promulgate regulations for the approval of
23applications under this subsection.

24(3) Before an application is approved, the Department of
25Revenue must make a finding that the applicant has filed all
26required State tax reports and returns for all applicable
27taxable years and paid any balance of State tax due as
28determined at settlement, assessment or determination by the
29Department of Revenue.

30(4) Notwithstanding any other provision of law, the

1Department of Revenue shall settle, assess or determine the
2tax of an applicant under this subsection within 90 days of
3the filing of all required final returns or reports in
4accordance with section 806.1(a)(5) of the act of April 9,
51929 (P.L.343, No.176), known as The Fiscal Code.

6(e) Purchasers and assignees.--Except as set forth in
7subsection (g), the following apply:

8(1) The purchaser or assignee of all or a portion of a
9tax credit under subsection (d) shall immediately claim the
10credit in the taxable year in which the purchase or
11assignment is made.

12(2) The amount of the tax credit that a purchaser or
13assignee may use against any one qualified tax liability may
14not exceed 50% of such qualified tax liability for the
15taxable year.

16(3) The purchaser or assignee may not carry forward,
17carry back or obtain a refund of or sell or assign the tax
18credit.

19(4) The purchaser or assignee shall notify the
20Department of Revenue of the seller or assignor of the tax
21credit in compliance with procedures specified by the
22Department of Revenue.

23(f) Limited carryforward of tax credits by a purchaser or
24assignee.--A purchaser or assignee may carry forward all or any
25unused portion of a tax credit purchased or assigned for no more
26than three taxable years following the first taxable year for
27which the taxpayer was entitled to claim the credit.

28Section 1706-J. Department guidelines and regulations.

29The department shall develop written guidelines for the
30implementation of the provisions of this article. The guidelines

1shall be in effect until such time as the department promulgates
2regulations for the implementation of the provisions of this
3article. The department shall promulgate regulations for the
4implementation of this article within two years of the effective
5date of this section.

6Section 1707-J. Reports to General Assembly.

7(a) Annual report.--By October 1, 2015, and October 1 of
8each year thereafter, the department shall submit a report on
9the tax credit to the chairman and minority chairman of the
10Appropriations Committee of the Senate, the chairman and
11minority chairman of the Community, Economic and Recreational
12Development Committee of the Senate, the chairman and minority
13chairman of the Appropriations Committee of the House of
14Representatives and the chairman and minority chairman of the
15Commerce Committee of the House of Representatives.

16(b) Content of report.--The report must include:

17(1) The names of the qualified taxpayers utilizing the
18tax credit as of the date of the report.

19(2) The amount of tax credits approved for, utilized by
20or sold or assigned by a qualified taxpayer.

21(3) The total increase in port cargo volume in this
22Commonwealth over the preceding year.

23(4) Any recommendations for changes in the calculation
24of the credit or administration of this article.

25(c) Publication.--Notwithstanding any law providing for the
26confidentiality of tax records, the information contained in the
27report shall be public information and shall be posted on the
28department's publicly accessible Internet website.

29Section 1708-J. Limitation on credits.

30The total amount of tax credits approved by the department

1under this article shall not exceed $5,000,000 in any calendar
2year.

3Section 2. This act shall take effect in 60 days.