PRINTER'S NO. 73
No. 70 Session of 1987
INTRODUCED BY MARKOSEK, MAYERNIK, J. L. WRIGHT, FOSTER,
J. TAYLOR, D. W. SNYDER, RYBAK, JOHNSON, OLASZ, COY, McCALL,
STUBAN, PHILLIPS, TRELLO, CARN, HALUSKA, VEON, LIVENGOOD,
GANNON, SWEET, LESCOVITZ, HERSHEY, GODSHALL, STABACK,
VAN HORNE, MORRIS, RAYMOND, GEIST, SCHULER, ARTY, SHOWERS,
CLYMER, BORTNER, GRUPPO, SIRIANNI, BIRMELIN, HERMAN,
PETRARCA, LANGTRY, LaGROTTA, FATTAH, CIVERA, JACKSON, CAWLEY,
MERRY, FREEMAN, DALEY, BOOK, MICOZZIE, FISCHER AND FOX,
JANUARY 28, 1987
REFERRED TO COMMITTEE ON EDUCATION, JANUARY 28, 1987
AN ACT
1 Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
2 act relating to the public school system, including certain
3 provisions applicable as well to private and parochial
4 schools; amending, revising, consolidating and changing the
5 laws relating thereto," further providing for the imposition
6 of taxes on earned income by school districts which eliminate
7 certain other taxes; further providing for the sale of unused
8 and unnecessary lands and buildings; increasing reimbursement
9 for school building construction; providing for special aid
10 to school districts suffering loss of tax revenue due to
11 reorganization or bankruptcy of businesses in the district;
12 and making editorial changes.
13 The General Assembly of the Commonwealth of Pennsylvania
14 hereby enacts as follows:
15 Section 1. The act of March 10, 1949 (P.L.30, No.14), known
16 as the Public School Code of 1949, is amended by adding a
17 section to read:
18 Section 680.1. School District Option.--(a) Whenever any
19 school district subject to the provisions of the act of December
1 31, 1965 (P.L.1257, No.511), known as "The Local Tax Enabling
2 Act," has levied any occupation tax using a millage or
3 percentage as a base or intends to levy such a tax, such school
4 district, after the will of the electors of the school district
5 is determined in the affirmative by referendum, shall repeal any
6 such occupation tax and may in lieu thereof levy, assess and
7 collect an additional tax on wages, salaries, commissions and
8 other earned income of individuals at a rate not to exceed one
9 and one-half per centum. Such tax on earned income shall be in
10 addition to any other tax on earned income authorized by any
11 other act. The levy, assessment and collection of such
12 additional tax on earned income shall be done in accordance with
13 the provisions of "The Local Tax Enabling Act" which are
14 incorporated herein by reference. Any school district which
15 levies such additional tax on earned income shall permanently
16 lose the authority to levy and collect any occupation tax using
17 a millage or percentage as a base. Revenues derived from the tax
18 authorized by this section shall be for the sole use of the
19 school district.
20 (b) Whenever electors equal to at least five per centum of
21 the highest vote cast for any school director at the last
22 preceding municipal election in any school district described in
23 subsection (a), or the school board of any such district, files
24 a petition with the county board of elections of the county for
25 a referendum on the question of the will of the electors with
26 respect to the levy, assessment and collection for the sole use
27 of the school district, of an additional tax upon earned income
28 at a rate not to exceed one and one-half per centum, in lieu of
29 an occupation tax using a millage or percentage as a base, but
30 not oftener than once every five years, the county board of
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1 elections shall cause the question to be placed on the ballot
2 and submitted at the next municipal primary election more than
3 sixty (60) days after the petition is filed. These proceedings
4 shall be in the same manner and subject to the provisions of the
5 election laws insofar as such provisions are applicable.
6 (c) The question shall be in the following form:
7 Do you favor the imposition of an additional school tax
8 upon earned income, not to exceed one and one-half per
9 centum, in lieu of an occupation tax using a millage or
10 percentage as a base?
11 (d) If a majority of the voting electors vote "Yes," then
12 the school district may levy the tax authorized by subsection
13 (a).
14 (e) The aggregate amount of all taxes imposed by a school
15 district that levies the tax authorized by this section shall
16 not in the first year the tax is levied exceed one hundred five
17 per centum of the total taxes levied in the previous year.
18 Section 2. Section 707(8) of the act, amended July 31, 1968
19 (P.L.796, No.242), is amended to read:
20 Section 707. Sale of Unused and Unnecessary Lands and
21 Buildings.--The board of school directors of any district is
22 hereby vested with the necessary power and authority to sell
23 unused and unnecessary lands and buildings, by any of the
24 following methods and subject to the following provisions:
25 * * *
26 (8) Notwithstanding the foregoing provisions of this
27 section, any school district of the second, third or fourth
28 class, upon approval of two-thirds (2/3) of the members of the
29 board of school directors of such district, may convey any
30 unused and unnecessary lands and buildings of the district to
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1 the city, borough, town or township, the boundaries of which are
2 coterminous with or within those of the district or a volunteer
3 fire company, volunteer ambulance service or volunteer rescue
4 squad located within the district, without consideration, or for
5 such consideration and on such terms of exchange or otherwise as
6 may be agreed upon, without first complying with the
7 requirements of the foregoing provisions of this section.
8 All such conveyances to a city, borough, town or township
9 shall contain a clause whereby the lands and buildings will
10 revert to the school district if they are no longer being used
11 for municipal or authority purposes. All such conveyances to a
12 volunteer fire company, volunteer ambulance service or volunteer
13 rescue squad shall contain a clause whereby the lands and
14 buildings will revert to the school district if they are no
15 longer being used for fire, ambulance or rescue services.
16 * * *
17 Section 3. The act is amended by adding a section to read:
18 Section 2502.16. Special Aid to School Districts Suffering
19 Loss of Tax Revenue Due to Reorganization or Bankruptcy of
20 Businesses in District.--(a) For the school year 1985-1986 and
21 each school year thereafter, a school district experiencing a
22 ten percent (10%) loss in revenue from real estate taxes for the
23 support of the public schools in any one (1) year or reasonably
24 projecting a loss of such percent of revenue following the
25 nonpayment of such taxes when due, by reason of the commencement
26 of reorganization or other bankruptcy proceedings by one or more
27 businesses owning real estate within the boundaries of the
28 public school district, shall qualify for special aid under this
29 section.
30 (b) Such special aid shall be paid from undistributed basic
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1 instruction subsidy funds to the extent that such funds are
2 available, and otherwise, shall be paid from any lapsed funds
3 which are then payable or subsequently do become payable into
4 the General Fund by any department or agency from appropriations
5 allotted to such department for the same or prior fiscal years.
6 A sufficient amount of such lapsed funds shall be made payable
7 from the General Fund to the Department of Education to
8 facilitate the prompt and orderly payment of all special aid to
9 which any and all school districts may be entitled under this
10 section.
11 (c) Such special aid shall be payable until such time as the
12 business reorganization or other bankruptcy proceedings are
13 completed: Provided, however, That a school district which
14 qualified for such special aid prior to the effective date of
15 this section shall receive its first payment in the year this
16 section takes effect.
17 (d) Any subsequent payments made on account of such ceased
18 or suspended real estate taxes by such business or businesses or
19 bankruptcy officials, either during the course of such
20 bankruptcy proceedings or following their completion, shall be
21 reimbursed to the Department of Education by the school district
22 to the extent that such previously unpaid taxes have been
23 supplanted by special aid already provided under this section.
24 Any interest or penalties accompanying such belatedly paid taxes
25 shall be retained by the school district to the extent that the
26 special aid previously paid to the school district did not
27 include such interest and penalties.
28 (e) The special aid owing hereunder shall be due whenever
29 the real estate taxes of such business or businesses in
30 bankruptcy are unpaid as of their due date and the business or
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1 businesses in question will not certify, in writing, that such
2 unpaid taxes will definitely be paid within sixty (60) days
3 after their due date, and there is in fact uncertainty as to the
4 payment of such taxes, whether such uncertainty is due to
5 bankruptcy proceeding restrictions, lack of funds or other
6 reasons.
7 Section 4. Section 2574(e) of the act, amended June 12, 1968
8 (P.L.192, No.96), is amended and subsections (b) and (c) are
9 amended by adding clauses to read:
10 Section 2574. Approved Reimbursable Rental for Leases
11 Hereafter Approved and Approved Reimbursable Sinking Fund
12 Charges on Indebtedness.--* * *
13 (b) For new school buildings the approved building
14 construction cost shall be the lesser of
15 * * *
16 (3.1) For school buildings for which the general
17 construction contract is awarded subsequent to July 1, 1984, and
18 for approved school building projects for which the general
19 construction contract was awarded but for which a lease or
20 general obligation bond resolution was not approved by the
21 Department of Education prior to July 1, 1984, the product of
22 the rated pupil capacity as determined by the Department of
23 Education at the time the project is approved and (i) three
24 thousand nine hundred dollars ($3,900) in the case of elementary
25 schools, (ii) five thousand one hundred dollars ($5,100) in the
26 case of secondary schools, (iii) an amount in the case of
27 combined elementary-secondary schools obtained by multiplying
28 the rated elementary pupil capacity by three thousand nine
29 hundred dollars ($3,900) and the rated secondary pupil capacity
30 by five thousand one hundred dollars ($5,100) and dividing the
19870H0070B0073 - 6 -
1 sum by the total rated pupil capacity.
2 (c) For additions or alterations to existing buildings
3 approved building construction cost shall be the lesser of
4 * * *
5 (3.1) For school buildings for which the general
6 construction contract is awarded subsequent to July 1, 1984, and
7 for approved school building projects for which the general
8 construction contract was awarded but for which a lease or
9 general obligation bond resolution was not approved by the
10 Department of Education prior to July 1, 1984, the difference
11 obtained by subtracting the appraisal value of the existing
12 building from the product of the rated pupil capacity of the
13 altered or expanded building as determined by the Department of
14 Education at the time the project is approved and (i) three
15 thousand nine hundred dollars ($3,900) in the case of elementary
16 schools, (ii) five thousand one hundred dollars ($5,100) in the
17 case of secondary schools, (iii) an amount in the case of
18 combined elementary-secondary schools obtained by multiplying
19 the rated elementary pupil capacity by three thousand nine
20 hundred dollars ($3,900) and the rated secondary pupil capacity
21 by five thousand one hundred dollars ($5,100) and dividing the
22 sum by the total rated pupil capacity of the altered or expanded
23 building.
24 * * *
25 (e) For area vocational-technical school and technical
26 institute projects leased subsequent to July 1, 1964, by or for
27 lease to a board of school directors authorized to operate such
28 a school, the Department of [Public Instruction] Education shall
29 calculate an approved reimbursable rental charge.
30 For area vocational-technical school and technical institute
19870H0070B0073 - 7 -
1 projects constructed or purchased subsequent to July 1, 1964, by
2 a board of school directors authorized to operate such a school,
3 the Department of [Public Instruction] Education may calculate
4 an approved reimbursable sinking fund charge.
5 Approved reimbursable rental or sinking fund charge shall
6 consist of that part of the annual rental or sinking fund
7 attributable to:
8 (1) Cost of acquiring land and preparing it for use to the
9 extent that such costs are deemed reasonable by the Department
10 of [Public Instruction] Education and the interest on such cost
11 of acquisition, cost of preparation and the cost of sewage
12 treatment and the interest on such costs.
13 (2) Machinery, apparatus, furniture and equipment and all
14 other necessary expenses and interest charges, but excluding
15 architects' fees in excess of six percent of the construction
16 cost.
17 The approved building construction cost and the interest on
18 such construction cost shall not exceed the product of the rated
19 full-time pupil capacity, as determined by the Department of
20 [Public Instruction] Education at the time the project is
21 approved and two thousand two hundred dollars ($2,200).
22 The provisions of the foregoing paragraph shall apply to all
23 school building projects for which the general construction
24 contract is awarded prior to July 1, 1966, and for approved
25 school building projects for which a lease was approved by the
26 Department of [Public Instruction] Education prior to July 1,
27 1966. For school buildings for which the general construction
28 contract is awarded subsequent to July 1, 1966, and for approved
29 school building projects for which the general construction
30 contract was awarded but for which a lease was not approved by
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1 the Department of [Public Instruction] Education prior to July
2 1, 1966, the approved building construction cost and the
3 interest on such construction cost shall not exceed the product
4 of the rated full-time pupil capacity, as determined by the
5 Department of [Public Instruction] Education at the time the
6 project is approved, and three thousand seven hundred dollars
7 ($3700).
8 For school buildings for which the general construction
9 contract is awarded subsequent to July 1, 1984, and for approved
10 school building projects for which the general construction
11 contract was awarded but for which a lease or general obligation
12 bond resolution was not approved by the Department of Education
13 prior to July 1, 1984, the approved building construction cost
14 and the interest on such construction cost shall not exceed the
15 product of the rated full-time pupil capacity, as determined by
16 the Department of Education at the time the project is approved,
17 and six thousand three hundred dollars ($6,300).
18 The Department of [Public Instruction] Education shall not
19 approve the expenditure of any funds borrowed or obtained by the
20 sale of bonds by any authority, nonprofit corporation, profit
21 corporation, company or individual for construction of area
22 vocational-technical schools or technical institutes for
23 bleachers, athletic field, lighting equipment or apparatus used
24 to promote and conduct interscholastic athletics.
25 * * *
26 Section 5. (a) Section 4 of this act shall take effect July
27 1, 1987.
28 (b) The remainder of this act shall take effect immediately.
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