PRINTER'S NO. 227
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
152
Session of
2015
INTRODUCED BY TEPLITZ, HUGHES, SCHWANK, COSTA, BREWSTER,
YUDICHAK AND WILLIAMS, JANUARY 27, 2015
REFERRED TO COMMUNITY, ECONOMIC AND RECREATIONAL DEVELOPMENT,
JANUARY 27, 2015
AN ACT
Amending Title 12 (Commerce and Trade) of the Pennsylvania
Consolidated Statutes, providing for implementation and
administration of the Pennsylvania First Program; and
imposing penalties.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 12 of the Pennsylvania Consolidated
Statutes is amended by adding a chapter to read:
CHAPTER 22
PENNSYLVANIA FIRST PROGRAM
Sec.
2201. Definitions.
2202. Administration.
2203. Application review.
2204. Terms and conditions.
2205. Penalties.
2206. Guidelines.
2207. Recipient report.
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2208. Evaluation.
§ 2201. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Eligible applicant." Any of the following entities that
apply for financial assistance:
(1) A for-profit entity.
(2) A not-for-profit entity.
(3) A municipality.
(4) A municipal authority organized under the former act
of May 2, 1945 (P.L.382, No.164), known as the Municipality
Authorities Act of 1945, or 53 Pa.C.S. Ch. 56 (relating to
municipal authorities).
(5) A redevelopment authority organized under the act of
May 24, 1945 (P.L.991, No.385), known as the Urban
Redevelopment Law.
(6) An industrial and commercial development authority
as defined under the act of August 23, 1967 (P.L.251,
No.102), known as the Economic Development Financing Law.
(7) A local development district as defined under the
act of December 7, 1994 (P.L.845, No.120), known as the Local
Development District Act.
(8) An industrial development agency as defined under
the act of May 17, 1956 (1955 P.L.1609, No.537), known as the
Pennsylvania Industrial Development Authority Act.
"Eligible use." Any of the following activities of an
eligible applicant:
(1) Job training for residents in this Commonwealth.
(2) The acquisition of interest in land, buildings or
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rights-of-way.
(3) The construction or rehabilitation of buildings.
(4) The construction or rehabilitation of
infrastructure.
(5) The purchase, upgrade or installation of machinery
and equipment.
(6) Working capital.
(7) Site preparation, including demolition and
clearance.
(8) Environmental assessments.
(9) Remediation of hazardous material.
(10) Payment of architectural and engineering fees not
to exceed 10% of the overall cost of a project.
"Financial assistance." A grant, loan or loan guarantee
provided by State funds for an eligible use.
"Program." The Pennsylvania First Program administered by
the department to provide financial assistance to facilitate
increased investment, job creation and job retention within this
Commonwealth.
"Recipient." An eligible applicant who receives financial
assistance under the program.
§ 2202. Administration.
The department shall administer the program with the goals
of:
(1) Promoting job creation.
(2) Promoting job retention.
(3) Maximizing each award of financial assistance.
(4) Promoting accountability for the use of financial
assistance.
§ 2203. Application review.
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The department shall review program applications to determine
if an applicant meets the department's eligibility criteria.
Applications shall be reviewed in accordance with the standards
and procedures adopted by the department for use in the review
process.
§ 2204. Terms and conditions.
(a) General rule.--The department shall impose terms and
conditions on the award of financial assistance.
(b) Penalty provision.--Loan agreements shall include a
penalty provision that specifies the penalty that may be imposed
by the department if:
(1) the loan is repaid in full prior to the date of the
recipient's final evaluation; and
(2) the recipient failed to create or retain the number
of required jobs.
(c) Collateral.--For any applicant that is determined by the
department to be at risk of not meeting job creation or job
retention requirements, the department shall require collateral
to secure repayment of any penalty imposed under the program.
§ 2205. Penalties.
(a) Imposition.--Except as provided in subsection (d), the
department shall impose a penalty upon a recipient for any of
the following:
(1) Failing to create or retain the number of jobs
specified in the executed commitment letter.
(2) Failing to invest the amount of private funds
specified in the executed commitment letter.
(3) Failing to operate at the project site for a minimum
period of seven years.
(b) Amount.-- The department shall use a formula to calculate
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the penalty amount to be assessed under subsection (a)(1). The
formula shall be based on the number of jobs a recipient fails
to create or retain.
(c) Limitations.--The following limitations apply:
(1) For grants, the penalty amount may not exceed the
full amount of the financial assistance received. The penalty
shall be payable in one lump sum or in installments, with or
without interest, as the department deems appropriate.
(2) For loans, the interest rate charged on the
outstanding principal amount of the loan may be increased up
to an additional 5% per year.
(d) Exception.--The department may waive the penalty
required by subsection (a) if the department determines that the
failure was due to circumstances outside the control of the
recipient. The department shall establish procedures governing
the process by which a waiver determination is made, including,
but not limited to, the following:
(1) Detailing the documentation, data and other
information required to be submitted by a recipient seeking a
waiver.
(2) Instituting methods for validating information
submitted by a recipient in support of the recipient's waiver
request.
(3) Documenting the department's waiver decision and the
factors it considered in rendering the decision.
§ 2206. Guidelines.
The department shall develop written guidelines for the
program. The guidelines shall do all of the following:
(1) Prescribe standards and procedures to be used in
evaluating and reviewing program applications and require
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consistent application of the standards and procedures.
(2) Require recipients to provide and update contact
information. Contact information shall include:
(i) The names and addresses of the officers and
directors if the recipient is a corporation.
(ii) The name and residence address of the owner if
the recipient is an individual owner.
(iii) The name and residence address of each owner,
partner or member and any managers if the recipient is a
partnership, association or limited liability company.
§ 2207. Recipient report.
Recipients shall provide the following information to the
department:
(1) Payroll records. A recipient shall provide its
payroll records to the department in monthly intervals. The
department shall examine payroll records to verify the
recipient's job creation or retention numbers.
(2) Annual progress update reports.
(3) A change or proposed change in operations or
corporate status that adversely affects or potentially
adversely affects the recipient's work force, including any
planned merger or consolidation. The recipient shall report
the change or proposed change immediately upon obtaining
knowledge thereof.
§ 2208. Evaluation.
The department shall:
(1) Outline program goals and performance measures in
its report under section 303 (relating to development) and
develop procedures to evaluate the program using these
measures.
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(2) Develop an objective evaluation process that
provides success and failure statistics on an award-by-award
basis.
(3) Refuse to accept recipient-reported job data unless
the report is signed and certified by the recipient's
highest-ranking officer and chief financial officer. The
progress update report form must include notification to
signatories that a misrepresentation of requested information
may subject the recipient to criminal prosecution under 18
Pa.C.S. § 4904 (relating to unsworn falsification to
authorities).
(4) Conduct site visits to review project expenditures.
(5) Perform the following to independently verify a
recipient's report of the number of jobs created or retained:
(i) Examine recipient payroll records. The
department shall ensure that a recipient provides actual
payroll records that contain sufficient information to
verify the accuracy and validity of the reported number
of jobs created or retained.
(ii) Use employment data available from the
Department of Labor and Industry.
(iii) Conduct periodic unannounced visits to project
sites.
(6) Conduct interim performance monitoring of all
recipients.
(7) Work in conjunction with applicable Federal and
State agencies to obtain employment data that is up to date
and useful in verifying the number of jobs created or
retained by a recipient.
Section 2. This act shall take effect in 60 days.
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