H0584B0635A05171 AJB:BTW 12/08/17 #90 A05171
AMENDMENTS TO HOUSE BILL NO. 584
Sponsor: REPRESENTATIVE LEWIS
Printer's No. 635
Amend Bill, page 1, lines 1 through 5, by striking out all of
said lines and inserting
Amending Title 72 (Taxation and Fiscal Affairs) of the
Pennsylvania Consolidated Statutes, establishing
microenterprise loan programs and abating real property
assessment.
Amend Bill, page 1, lines 8 through 19; pages 2 through 32,
lines 1 through 30; page 33, lines 1 through 21; by striking out
all of said lines on said pages and inserting
Section 1. Title 72 of the Pennsylvania Consolidated
Statutes is amended by adding a chapter to read:
CHAPTER 31
MICROENTERPRISE ASSISTANCE
Subchapter
A. Preliminary Provisions
B. Microenterprise Loan Programs
SUBCHAPTER A
PRELIMINARY PROVISIONS
Sec.
3101. Definitions.
§ 3101. 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:
"Administrative entity." Any of the following:
(1) An entity certified by the Pennsylvania Industrial
Development Authority under 64 Pa.C.S. § 1123 (relating to
certification of economic development organizations).
(2) A public instrumentality of the Commonwealth and a
body politic and corporate created under the act of August
23, 1967 (P.L.251, No.102), known as the Economic Development
Financing Law.
(3) An authority organized and existing under the former
act of May 2, 1945 (P.L.382, No.164), known as the
Municipality Authorities Act of 1945, or an authority
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established under 53 Pa.C.S. Ch. 56 (relating to municipal
authorities).
(4) A redevelopment authority established under the act
of May 24, 1945 (P.L.991, No.385), known as the Urban
Redevelopment Law.
(5) A community development financial institution
certified in accordance with the Community Development
Banking and Financial Institutions Act of 1994 (Public Law
103-325, 108 Stat. 2163).
"Department." The Department of Community and Economic
Development of the Commonwealth.
"Low income." A household with total income at or below 80%
of the area median income, adjusted for household size, as
defined annually by the United States Department of Housing and
Urban Development.
"Microenterpise." A sole proprietorship, partnership or
limited liability company that employs one to five employees and
has the qualifying amount of capital provided under the Small
Business Jobs Act of 2010 (Public Law 111-240, 124 Stat. 2504).
"Municipality." A county, city, borough, incorporated town,
township or home rule municipality.
"Program." A microenterprise assistance program authorized
by this chapter.
"Real property." Land and all structures and fixtures
thereon and all estates and interests in land, including
easements, covenants and leaseholders.
"School district." As to any real property acquired, owned
or conveyed by an administrative entity, the school district
within which the geographical jurisdiction of the real property
is located.
"Secretary." The Secretary of Community and Economic
Development of the Commonwealth.
"Start-up entrepreneur." An individual, partnership, limited
liability company that establishes a microenterprise.
SUBCHAPTER B
MICROENTERPRISE LOAN PROGRAMS
Sec.
3111. Purpose.
3112. Powers of administrative entity.
3113. Acquisition of property and responsibilities.
3114. Funding.
3115. Property tax exemption schedule of real property.
3116. Microenterprise loans.
3117. Administration of program.
3118. Disposition of property.
§ 3111. Purpose.
An administrative entity may create a microenterprise loan
program to assist low-income individuals in the establishment of
a microenterprise.
§ 3112. Powers of administrative entity.
(a) General rule.--In addition to powers granted to an
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administrative entity in other laws, an administrative entity
shall have the following powers necessary to operate a program:
(1) To issue loans to microenterprises that will operate
on property owned by the administrative entity and leased to
the microenterprise. The program shall target
microenterprises of low-income individuals.
(2) To negotiate for loans and grants from both public
and private sources in order to fund the program.
(3) To make loans to low-income start-up entrepreneurs.
(4) To acquire property to lease to start-up
entrepreneurs in order to facilitate the establishment of a
microenterprise.
(5) To enter into an intergovernmental cooperation
agreement with other administrative entities or
municipalities relative to the operations of the program.
(b) Eminent domain.-- An administrative entity does not
possess the power of eminent domain by establishing and
implementing a program.
§ 3113. Acquisition of property and responsibilities.
(a) General rule.--An administrative entity may acquire real
property to lease to start-up entrepreneurs who receive a
microenterprise loan under the program in the following manners:
(1) An administrative entity may acquire real property
by purchase contracts, lease purchase agreements, installment
sales contracts and land contracts and may accept transfers
from municipalities upon terms and conditions as agreed to by
the administrative entity and the municipality.
(2) A municipality may transfer to an administrative
entity real property and interests in real property of the
municipality on terms and conditions and according to
procedures determined by the municipality so long as the real
property is located within the jurisdiction of the
municipality.
(3) A redevelopment authority may, with the consent of
the local governing body and without a redevelopment
contract, convey property which the redevelopment authority
acquired before the effective date of this paragraph to the
administrative entity. A conveyance under this paragraph
shall be with fee simple title, free of all liens and
encumbrances.
(4) An administrative entity may, if authorized by the
jurisdiction that created an authority or otherwise by
intergovernmental cooperation agreement, accept donations of
real property and extinguish delinquent claims for taxes as
to the property under section 5.1 of the act of May 16, 1923
(P.L.207, No.153), referred to as the Municipal Claim and Tax
Lien Law, or section 303 of the act of July 7, 1947
(P.L.1368, No.542), known as the Real Estate Tax Sale Law.
For the purposes of this paragraph, the administrative entity
shall have all rights and obligations of the municipality
provided for in section 5.1 of the Municipal Claim and Tax
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Lien Law.
(5) Notwithstanding any other provision of law to the
contrary, if a tax delinquent property offered at judicial
sale is not sold, the trustee may donate the property to an
administrative entity for the purpose of this chapter after
written notification of the transfer to all interested
parties.
(b) Title to be held in its name.--An administrative entity
shall hold in its own name all real property it acquires to
administer the microenterprise program under this chapter.
§ 3114. Funding.
(a) General rule.--The administrative entity may receive
funding through grants from:
(1) The Federal Government.
(2) The Commonwealth.
(3) A municipality that created the authority.
(4) Private sources.
(b) Revenue.--An administrative entity may receive and
retain payments for services rendered, for rents and leasehold
payments received, for consideration for disposition of real and
personal property, for proceeds of insurance coverage for losses
incurred, for income from investments and for an asset and
activity lawfully permitted to the authority under this chapter.
§ 3115. Property tax exemption schedule of real property.
A municipality and school district shall have the power and
authority to grant property tax abatement, in the manner
provided in this section, to properties leased to a
microenterprise for one or more consecutive years, and owned by
an administrative entity:
(1) For the first, second and third years for which the
property would otherwise be taxable, and is continually
leased to the microenterprise, 100% of the eligible
assessment shall be exempted.
(2) For the fourth year for which the property would
otherwise be taxable, and is continually leased to the
microenterprise, 90% of the eligible assessment shall be
exempted.
(3) For the fifth year for which the property would
otherwise be taxable, and is continually leased to the
microenterprise, 75% of the eligible assessment shall be
exempted.
(4) For the sixth year for which the property would
otherwise be taxable, and is continually leased to the
microenterprise, 60% of the eligible assessment shall be
exempted.
(5) For the seventh year for which the property would
otherwise be taxable, and is continually leased to the
microenterprise, 45% of the eligible assessment shall be
exempted.
(6) For the eighth year for which the property would
otherwise be taxable, and is continually leased to the
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microenterprise, 30% of the eligible assessment shall be
exempted.
(7) For the ninth year for which the property would
otherwise be taxable, and is continually leased to the
microenterprise, 15% of the eligible assessment shall be
exempted.
(8) For the tenth year for which the property would
otherwise be taxable, and is continually leased to the
microenterprise, 10% of the eligible assessment shall be
exempted.
(9) After the tenth year of being continually leased to
the microenterprise, the exemption shall terminate.
§ 3116. Microenterprise loans.
(a) Loan issuance.--
(1) An administrative entity may issue a loan to a
microenterprise that operates on property owned by the
administrative entity within the program.
(2) An administrative entity may partner with a private
entity that issues microloans for the purpose of providing a
loan under paragraph (1).
(3) If a loan payment becomes delinquent, the
administrative entity may offer a hardship agreement to the
microenterprise to restructure the payment process.
(b) Training.--For the purpose of reducing the financial
risk involved in issuing a loan under subsection (a)(1) and
providing loan applicants with the skills necessary to succeed,
a loan applicant must complete business courses and workshops on
operating a business, creating market strategy and customer
interaction to be eligible to receive a loan.
(c) Training resources.--
(1) Upon request by an administrative entity, the
department shall assist the administrative entity in
identifying organizations that can provide the business
training required under subsection (b) to loan applicants.
The administrative entity shall direct loan applicants to the
organizations that provide the business training.
(2) The administrative entity may partner with a private
entity, including commercial, and nonprofits or organizations
specializing in training start-up entrepreneurs, for any of
the following:
(i) using the private entity's facilities or
expertise to help loan applicants fulfill the business
training required under subsection (b); or
(ii) acquiring building space, whether the building
space is leased or donated, for the purpose of conducting
business training required under subsection (b).
(d) Eligible applicants.--
(1) An administrative entity shall impose requirements
for eligible applicants and the requirements are readily
available to the public. The requirements shall include, but
not be limited to:
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(i) An applicant must be low income.
(ii) An applicant must demonstrate need for capital
and technical assistance to operate a business, with need
defined by the administrative entity.
(iii) An applicant must have an established business
plan and provide a summary of the plan to the
administrative entity, if requested.
§ 3117. Administration of program.
(a) Limitation on administrative cost.--The cost of
administering a program may not exceed 10% of the program's
operating budget.
(b) Maintenance.--An administrative entity shall maintain
all of its real property in accordance with the laws of this
Commonwealth and ordinances of the jurisdiction in which the
real property is located.
§ 3118. Disposition of property.
(a) Public access to inventory.--An administrative entity
shall maintain and make available for public review and
inspection an inventory of real property held by the
administrative entity for the program.
(b) Power.--The authority may convey, exchange, sell,
transfer, lease, grant or mortgage interests in real property of
the administrative entity in the form and by the method
determined by the administrative entity to be in the best
interests of the microenterprise loan program.
(c) Consideration.--
(1) The administrative entity shall determine the amount
and form of consideration necessary to convey, exchange,
sell, transfer, lease as lessor, grant or mortgage interests
in real property.
(2) Consideration may take the form of monetary payments
and secured financial obligations, covenants and conditions
related to the present and future use of the property,
contractual commitments of the transferee and other forms of
consideration as determined by the administrative entity to
be in the best interest of the program.
(d) Policies and procedures.--
(1) An administrative entity shall create policies and
procedures providing the general terms and conditions for
consideration to be received by the administrative entity for
the transfer of real property and interests in real property.
(2) Requirements which may be applicable to the
disposition of real property and interests in real property
by municipalities shall not be applicable to the disposition
of real property and interests in real property by the
administrative entity.
(e) Land use plans.--The administrative entity shall
consider all duly adopted land use plans and make reasonable
efforts to coordinate the disposition of an administrative
entity's real property with the land use plans.
Section 2. This act shall take effect in 60 days.
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