PRINTER'S NO. 3822
No. 2617 Session of 2002
INTRODUCED BY MELIO, STEIL, GRUCELA, RUBLEY, ARMSTRONG, BASTIAN,
BUNT, CAPPELLI, CIVERA, CORRIGAN, CREIGHTON, CURRY, DAILEY,
DALEY, DALLY, DiGIROLAMO, DIVEN, FEESE, FLICK, FREEMAN,
GODSHALL, HANNA, HARHAI, HENNESSEY, HERMAN, HERSHEY, LEH,
MANDERINO, MANN, MARSICO, McCALL, McNAUGHTON, NAILOR,
PALLONE, PIPPY, PISTELLA, READSHAW, ROSS, SAINATO, SCHRODER,
SEMMEL, SHANER, B. SMITH, STEELMAN, R. STEVENSON, TANGRETTI,
E. Z. TAYLOR, THOMAS, TIGUE, VANCE, WALKO, WATSON,
YOUNGBLOOD, YUDICHAK AND ZIMMERMAN, MAY 6, 2002
REFERRED TO COMMITTEE ON FINANCE, MAY 6, 2002
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," providing for school district real
6 property tax relief for qualified owners of homesteads or
7 farmsteads and for certain Commonwealth payments.
8 The General Assembly of the Commonwealth of Pennsylvania
9 hereby enacts as follows:
10 Section 1. The act of March 10, 1949 (P.L.30, No.14), known
11 as the Public School Code of 1949, is amended by adding an
12 article to read:
13 ARTICLE VI-B
14 SPECIAL REAL PROPERTY TAX PROVISIONS
15 Section 601-B. Short title of article.
16 This article shall be known and may be cited as the School
17 District Real Property Tax Relief Act.
1 Section 602-B. Legislative declaration.
2 The General Assembly, in recognition of the powers contained
3 in section 2(b)(ii) of Article VIII of the Constitution of
4 Pennsylvania which provides for the establishing as a class or
5 classes of subjects of taxation the property or privileges of
6 persons who because of poverty are determined to be in need of
7 special tax provisions, hereby declares as its legislative
8 intent and purpose to implement such power under such
9 constitutional provision by establishing special real property
10 tax provisions as provided in this article.
11 Section 603-B. Definitions.
12 The following words and phrases when used in this article
13 shall have the meanings given to them in this section unless the
14 context clearly indicates otherwise:
15 "Claimant." A resident individual domiciled in a school
16 district who is the owner of a homestead or farmstead and who is
17 liable for the payment of real property taxes levied by the
18 school district on the homestead or farmstead.
19 "Farmstead." All buildings and structures on a farm not less
20 than ten contiguous acres in area, not otherwise exempt from
21 real property taxation or qualified for any other abatement or
22 exclusion pursuant to any other law, that are used primarily to
23 produce or store any farm product produced on the farm for
24 purposes of commercial agricultural production, to house or
25 confine any animal raised or maintained on the farm for the
26 purpose of commercial agricultural production, to store any
27 agricultural supply to be used on the farm in commercial
28 agricultural production or to store any machinery or equipment
29 used on the farm in commercial agricultural production. This
30 term shall only apply to farms used as the domicile of an owner.
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1 "Governing body." A board of school directors of a school
2 district or any other entity performing the duties of school
3 directors.
4 "Homestead." A dwelling, including the parcel of land on
5 which the dwelling is located and the other improvements located
6 on the parcel, for which any of the following apply:
7 (1) The dwelling is primarily used as the domicile of an
8 owner who is a natural person. The homestead for real
9 property qualifying under this paragraph shall not include
10 the land on which the dwelling is located if the land is not
11 owned by a person who owns the dwelling.
12 (2) The dwelling is a unit in a condominium as the term
13 is defined in 68 Pa.C.S. § 3103 (relating to definitions) and
14 the unit is primarily used as the domicile of a natural
15 person who is an owner of the unit; or the dwelling is a unit
16 in a cooperative as the term is defined in 68 Pa.C.S. § 4103
17 (relating to definitions) and the unit is primarily used as
18 the domicile of a natural person who is an owner of the unit.
19 The homestead for a unit in a condominium or a cooperative
20 shall be limited to the assessed value of the unit, which
21 shall be determined in a manner consistent with the
22 assessment of real property taxes on those units under 68
23 Pa.C.S. (relating to real and personal property) or as
24 otherwise provided by law. If the unit is not separately
25 assessed for real property taxes, the homestead shall be a
26 pro rata share of the real property.
27 (3) The dwelling does not qualify under paragraphs (1)
28 and (2) and a portion of the dwelling is used as the domicile
29 of an owner who is a natural person. The homestead for real
30 property qualifying under this paragraph shall be the portion
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1 of the real property that is equal to the portion of the
2 dwelling that is used as the domicile of an owner.
3 "Household income." All income as defined in this section
4 which is received by the claimant and by the claimant's spouse
5 during the calendar year for which a claim is filed for school
6 district real property tax relief as provided in this article.
7 "Income." All income from whatever source derived,
8 including, but not limited to, salaries, wages, bonuses,
9 commissions, income from self-employment, alimony, support
10 money, cash public assistance and relief, the gross amount of
11 any pensions or annuities, including railroad retirement
12 benefits, all benefits received under the Social Security Act
13 (49 Stat. 620, 42 U.S.C. § 301 et seq.) except Medicare
14 benefits, all benefits received under State unemployment
15 insurance laws and veterans' disability payments, all interest
16 received from the Federal Government or any state government or
17 any instrumentality or political subdivision thereof, realized
18 capital gains, rentals, workers' compensation and the gross
19 amount of loss of time insurance benefits, life insurance
20 benefits and proceeds, except the first $5,000 of the total of
21 death benefits payments, and gifts of cash or property, other
22 than transfers by gift between members of a household, in excess
23 of a total value of $300, but shall not include surplus food or
24 other relief in kind supplied by a government agency or property
25 tax rebate.
26 "Owner." Includes any of the following:
27 (1) A joint tenant or tenant in common.
28 (2) A person who is purchasing real property under a
29 contract.
30 (3) A partial owner.
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1 (4) A person who owns real property as a result of being
2 a beneficiary of a will or trust or as a result of intestate
3 succession.
4 (5) A person who owns or is purchasing a dwelling on
5 leased land.
6 (6) A person holding a life lease in real property
7 previously sold or transferred to another.
8 (7) A person in possession under a life estate.
9 (8) A grantor who has placed the real property in a
10 revocable trust.
11 (9) A member of a cooperative as defined in 68 Pa.C.S. §
12 4103 (relating to definitions).
13 (10) A unit owner of a condominium as defined in 68
14 Pa.C.S. § 3103 (relating to definitions).
15 (11) A partner of a family farm partnership or a
16 shareholder of a family farm corporation as the terms are
17 defined in section 1101-C of the act of March 4, 1971 (P.L.6,
18 No.2), known as the Tax Reform Code of 1971.
19 "Real property taxes." Taxes levied by or on behalf of a
20 school district on all real property assessed and certified for
21 taxation in the territory constituting the school district.
22 "Resident individual." An individual who is domiciled in a
23 school district.
24 "School district." A school district of the first class,
25 first class A, second class, third class or fourth class,
26 including any independent school district.
27 Section 604-B. Real property tax relief.
28 (a) General rule.--Any claimant who meets the requirements
29 of this section shall be exempt from the payment of the balance
30 of any real property tax imposed by a school district which is
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1 in excess of 3% of household income.
2 (b) Eligibility.--To be eligible for school district real
3 property tax relief in any calendar year, a claimant must
4 satisfy all of the following requirements:
5 (1) The claimant must be a resident individual domiciled
6 in the school district and the owner of a homestead or a
7 farmstead against which is assessed and levied a school
8 district real property tax.
9 (2) The claimant in each calendar year shall have
10 household income which is equal to or less than 235% of the
11 Federal poverty level and have levied and assessed school
12 district real property taxes which equal or exceed 3% of
13 household income.
14 (c) Filing of claim.--Each claimant for school district real
15 property tax relief shall file a claim with the school district
16 levying the tax on or before October 1, 2002, and each October 1
17 thereafter.
18 (d) Content of claim.--The claim form shall contain at least
19 all of the following information:
20 (1) The name and marital status of the claimant.
21 (2) The address of the real property which is the
22 subject of the tax.
23 (3) A copy of the school district real property tax
24 duplicate for the property.
25 (4) A complete statement of household income for the
26 previous calendar year.
27 (5) A certification that the real property is either a
28 homestead or a farmstead.
29 (6) A certification that all information is correct to
30 the best of the claimant's knowledge, information and belief.
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1 (e) Approval of claims.--All claims for school district real
2 property tax relief shall be approved or disapproved by December
3 1 of each calendar year.
4 Section 605-B. Duties of school district.
5 (a) Form.--Each school district shall develop a form for
6 claims for school district real property tax relief which
7 complies with the requirements of section 604-B(d) (relating to
8 real property tax relief). The form shall be included with each
9 real property tax duplicate sent to taxpayers.
10 (b) Report to department.--On or before February 1, 2003,
11 and annually thereafter, each school district shall file a
12 report with the Department of Education which lists the total
13 amount of real property tax relief approved by the school
14 district and a list of approved claimants.
15 (c) Initial real property tax relief.--School district real
16 property tax relief under this article shall initially occur for
17 the school tax year beginning July 1, 2003, and for each school
18 year thereafter.
19 Section 606-B. Responsibilities of Commonwealth.
20 (a) General rule.--As provided in section 2(b)(ii) of
21 Article VIII of the Constitution of Pennsylvania, the
22 Commonwealth shall reimburse each school district for the
23 revenues lost as a result of real property tax relief approved
24 under this article. The initial payment to school districts for
25 real property tax relief shall be made in the fiscal year July
26 1, 2004, to June 30, 2005, based on information gathered in 2003
27 and 2004.
28 (b) Duties of department.--The Department of Education shall
29 annually determine the amount of real property tax relief
30 payments each school district shall receive from the
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1 Commonwealth. The initial payment shall be made on or before
2 September 1, 2004, and all subsequent payments made annually
3 thereafter.
4 Section 2. This act shall take effect as follows:
5 (1) For school districts where fiscal year begins on
6 January 1, this act shall take effect January 1, 2003.
7 (2) For school districts where fiscal year begins on
8 July 1, this act shall take effect July 1, 2003.
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