PRINTER'S NO.  541

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

HOUSE BILL

 

No.

489

Session of

2009

  

  

INTRODUCED BY ARGALL, BRENNAN, DALEY, GEIST, GROVE, HARPER, MANN, MELIO, O'NEILL, PYLE, READSHAW, REICHLEY, SIPTROTH, VULAKOVICH, WANSACZ, WHEATLEY AND FREEMAN, FEBRUARY 18, 2009

  

  

REFERRED TO COMMITTEE ON COMMERCE, FEBRUARY 18, 2009  

  

  

  

AN ACT

  

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Providing for the establishment of cooperative community

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development programs throughout this Commonwealth utilizing

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the resources of the Commonwealth, local municipalities and

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employers to encourage employees to locate near and reside in

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communities located close to employer worksites; establishing

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a tax credit program to encourage employer participation; and

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imposing additional powers and duties on the Department of

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Community and Economic Development and the Department of

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Revenue.

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The General Assembly of the Commonwealth of Pennsylvania

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hereby enacts as follows:

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Section 1.  Short title.

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This act shall be known and may be cited as the Live Near

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Your Work Program Act.

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Section 2.  Legislative purpose.

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The General Assembly by enactment of this legislative

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proposal intends to accomplish the following objectives:

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(1)  Stimulate home ownership in designated neighborhoods

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which qualify for participation in a Live Near Your Work

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project.

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(2)  Promote public-private partnerships to strengthen,

 


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revitalize and preserve communities.

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(3)  Support Commonwealth transportation policy by

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promoting shorter commuting times and use of mass transit.

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(4)  Support employer compliance with the Clean Air Act

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Amendments of 1990 (Public Law 101-549, 42 U.S.C. § 7401 et

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seq.).

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(5)  Promote the controlled, planned, ecologically sound

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and people friendly growth of Pennsylvania communities.

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Section 3.  Definitions.

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The following words and phrases when used in this act shall

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have the meanings given to them in this section unless the

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context clearly indicates otherwise:

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"Borrower income."  The combined income of an employee-owner

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and any co-owner of an eligible residence who are assisted

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pursuant to the provisions of this act.

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"Department."  The Department of Community and Economic

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Development of the Commonwealth.

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"Designated neighborhood."  A neighborhood in a city of the

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first class, second class, second class A or third class or a

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borough in Pennsylvania that has been designated as a Live Near

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Your Work area neighborhood where employees may purchase homes

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under an LNYW program. The employee's plan and the designated

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neighborhood must be approved by the Department of Community and

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Economic Development.

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"Eligible employee."  An individual who meets all of the

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following criteria:

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(1)  Is employed by an employer participating in the Live

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Near Your Work Tax Credit Program.

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(2)  Is 18 years of age or older.

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(3)  Has a contract to purchase an eligible residence

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located in the employer's applicable LNYW area.

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(4)  Holds or will hold title to an eligible residence

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and certifies that the individual will occupy the residence

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as the primary residence.

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(5)  Makes or will make a cash contribution of at least

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$1,000 from the individual's own verifiable funds toward the

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cost of the down payment or settlement costs in connection

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with purchasing an eligible residence.

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(6)  Has income not exceeding the maximum allowable

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amount established by the program.

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(7)  Meets any additional eligibility requirements

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imposed by the local municipality, the participating employer

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or by the Department of Community and Economic Development

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and is approved by the department.

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"Eligible residence."  A residential dwelling unit that

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satisfies all of the following requirements:

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(1)  The dwelling unit is, or will be, the primary

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residence of an eligible employee.

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(2)  The dwelling unit is located in the Live Near Your

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Work area of the employer of the eligible employee.

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(3)  The dwelling unit is a single unit, a townhouse or a

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condominium unit.

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"Income."  The amount of Pennsylvania taxable income listed

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on the Pennsylvania Personal Income Tax Return of an eligible

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employee or any co-owner with an eligible employee for the

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calendar year in which assistance under this act is received.

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"Live Near Your Work Program" or "LNYW."  The Live Near Your

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Work Program established under section 4.

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"LNYW area."  An area within a local municipality that:

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(1)  Is designated as the area where eligible employees

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of an employer may purchase a residence.

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(2)  Has a relationship to the employer's worksite

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location that supports the objectives of the program.

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(3)  Is approved by the local municipality in which the

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area exists for consistency with the local comprehensive

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zoning plan.

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(4)  Is approved by the Department of Community and

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Economic Development.

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"LNYW grant."  The funds granted by the employer to the

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eligible employee under the terms of this act.

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"LNYW project."  The program operated by the local

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municipality within the Live Near Your Work boundary for the

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local municipality.

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"Local municipality."  A city of the first class, second

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class, second class A or third class or borough located within

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this Commonwealth.

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"Settlement costs."  Reasonable and customary costs which are

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paid by the buyer of a residence at the time of settlement,

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including, but not limited to:

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(1)  Any credit or mortgage application fee.

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(2)  Any title insurance premium and title search fees.

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(3)  Any attorney fees.

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(4)  Any document preparation fee.

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(5)  Any real property inspection or appraisal fees.

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(6)  Any portion of the Realty Transfer Tax paid by the

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buyer.

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Section 4.  Live Near Your Work Program.

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The department shall establish, implement and administer the

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Live Near Your Work Program. The LNYW Program shall be a

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cooperative effort between the Commonwealth, local

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municipalities and employers to designate LNYW areas within

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local municipalities where LNYW projects may be located and

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where employer assistance may be given to eligible employees to

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purchase eligible residences within the LNYW project.

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Section 5.  Employer eligibility criteria for participation in

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LNYW Program.

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(a)  Specific criteria.--Any employer who wishes to

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participate in a program and designate an LNYW area shall meet

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all of the following requirements:

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(1)  In conjunction with the local municipality, apply to

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the department for the approval of a designated area or areas

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within a local municipality as an LNYW area.

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(2)  Agree to provide an LNYW cash grant equal to at

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least $500 per household to each participating employee who

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purchases a residential dwelling unit within an LNYW area to

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reimburse the employee for a portion of the settlement costs

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incurred for the purchase.

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(3)  In coordination with the local municipality

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designate an LNYW area.

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(4)  Coordinate participation in the LNYW Program with

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the local municipality.

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(5)  Submit all other materials to and comply with any

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restrictions imposed by the local municipality or the

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department.

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(6)  Make all contributions in the form of a cash grant.

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(7)  Designate LNYW area neighborhoods within a

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reasonable distance by bicycle or by foot or mass transit

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from the participating employer.

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(b)  Additional criteria.--Consistent with the purposes of

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this act, the department shall, and a local municipality may,

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promulgate and adopt additional criteria necessary to carry out

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the provisions of this act.

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(c)  Multiple employer locations.--If an employer has more

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than one worksite location, there may be an LNYW area for each

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worksite location, each of which shall comply with this act and

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any department and local municipal regulations regarding the

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designation and approval of an LNYW area. The LNYW areas for an

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employer under this section may overlap. In addition to any

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other requirements of this act, an employee and a residence

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shall only be eligible if the residence is located in the LNYW

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area of the employer for the worksite location where the

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employee works.

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Section 6.  Employee eligibility to participate in LNYW Program.

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In addition to any other criteria established by the

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department, the local municipality and the employer for

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participation by an employee, an employee who has a Pennsylvania

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taxable income in excess of 150% of Statewide median income in

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the year of application for a cash grant shall not be eligible

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for participation.

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Section 7.  LNYW tax credit.

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(a)  Eligibility.--Each employer who establishes an approved

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LNYW area and makes a minimum of $12,000 per taxable year of

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cash grants to eligible employees shall, subject to subsection

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(b), be eligible to receive a tax credit equal to 50% of the

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amount of money invested in the LNYW area and paid as cash

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grants.

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(b)  Annual approval.--The department and each local

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municipality where the employer has an approved LNYW area shall

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annually certify to the Department of Revenue that the employer

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applicant for a tax credit has complied with the provisions of

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this act and the regulations promulgated by the department and

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local municipality.

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(c)  Grant of tax credit.--The Department of Revenue, after

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receipt of an application under subsection (a) and the

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certification under subsection (b), shall grant a tax credit as

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provided in subsection (a) to be used by the employer to satisfy

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any Pennsylvania tax liability due under Article III, IV, VI,

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VII, VIII, IX or XV of the act of March 4, 1971 (P.L.6, No.2),

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known as the Tax Reform Code of 1971.

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(d)  Annual limitations.--Annually, the total amount of tax

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credits approved under this section shall not exceed $2,000,000.

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(e)  Employer limitations.--The following limitations shall

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apply to any employer who receives a tax credit under this

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section:

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(1)  The tax credit used in any one taxable year shall

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not exceed the tax liability of the employer.

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(2)  An employer which is a bank, bank and trust company,

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insurance company, trust company, national bank, savings

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association, mutual savings bank or building and loan

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association shall not be eligible to receive any tax credits

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under this section for activities that are part of their

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normal course of business or for which they receive credit

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under the Community Reinvestment Act of 1977 (91 Stat. 1111,

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12 U.S.C. § 2901 et seq.).

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(f)  Carryforward of unused tax credit.--Any tax credit not

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used in the period the investment was made may be carried

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forward for the next five succeeding calendar or fiscal years

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until the full credit has been exhausted.

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Section 8.  Taxability of cash grant.

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Any LNYW cash grant received under this act shall not be

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taxable for any purposes under Article III of the act of March

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4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971.

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Section 9.  Additional duties of department.

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(a)  Annual list of approved LNYW areas.--The department

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shall compile a list of all applications for LNYW areas

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submitted under this act. The list shall also include the

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disposition of each application. This list shall be submitted by

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the department to the Governor and the General Assembly annually

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on or before October 1.

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(b)  Written response.--The decision of the Secretary of

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Community and Economic Development to approve or disapprove an

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application under section 7 shall be in writing, and if the

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proposal is approved, it shall state the maximum credit

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allowable to the employer. A copy of the decision of the

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secretary shall be transmitted to the Secretary of Revenue.

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Section 10.  Expiration.

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This act shall expire July 1, 2012.

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Section 11.  Effective date.

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This act shall take effect in 90 days.

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