Regular Session 2017-2018 House Bill 0453 P.N. 2410

PRIOR PRINTER'S NOS. 474, 1241, 1501,

2258

PRINTER'S NO. 2410

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

453

Session of

2017

INTRODUCED BY RYAN, CUTLER, DUNBAR, DUSH, GABLER, GROVE,

JOZWIAK, MILLARD, SAYLOR, SCHWEYER, WARD, CORR, ZIMMERMAN,

PHILLIPS-HILL, SOLOMON, STAATS, RABB, ROZZI, B. MILLER AND

GREINER, FEBRUARY 13, 2017

AMENDMENTS TO SENATE AMENDMENTS, HOUSE OF REPRESENTATIVES,

SEPTEMBER 13, 2017

AN ACT

Amending the act of April 9, 1929 (P.L.343, No.176), entitled

"An act relating to the finances of the State government;

providing for the settlement, assessment, collection, and

lien of taxes, bonus, and all other accounts due the

Commonwealth, the collection and recovery of fees and other

money or property due or belonging to the Commonwealth, or

any agency thereof, including escheated property and the

proceeds of its sale, the custody and disbursement or other

disposition of funds and securities belonging to or in the

possession of the Commonwealth, and the settlement of claims

against the Commonwealth, the resettlement of accounts and

appeals to the courts, refunds of moneys erroneously paid to

the Commonwealth, auditing the accounts of the Commonwealth

and all agencies thereof, of all public officers collecting

moneys payable to the Commonwealth, or any agency thereof,

and all receipts of appropriations from the Commonwealth,

authorizing the Commonwealth to issue tax anticipation notes

to defray current expenses, implementing the provisions of

section 7(a) of Article VIII of the Constitution of

Pennsylvania authorizing and restricting the incurring of

certain debt and imposing penalties; affecting every

department, board, commission, and officer of the State

government, every political subdivision of the State, and

certain officers of such subdivisions, every person,

association, and corporation required to pay, assess, or

collect taxes, or to make returns or reports under the laws

imposing taxes for State purposes, or to pay license fees or

other moneys to the Commonwealth, or any agency thereof,

every State depository and every debtor or creditor of the

Commonwealth," implementing the 2017-2018 Commonwealth budget

and instituting future budget implementation: in Treasury

Department, providing for provisions for General Assembly; in

Department of Auditor General, further providing for audits

of agencies receiving State aid and providing for audits of

interstate commissions; in procedure for the disbursement of

money from the State Treasury, further providing for

settlement agreements and enforcement actions; in financially

distressed municipalities, providing for payroll tax; in oil

and gas wells, further providing for definitions, providing

for Oil and Gas Lease Fund, repealing provisions relating to

AND FURTHER PROVIDING FOR oil and gas operations in the South

Newark Basin and providing for temporary cessation of oil and

gas wells; in transportation network companies and motor

carrier companies, providing for regulation of taxicabs and

limousines by parking authority of city of the first class,

for penalties and for provision of transportation network

service; in Budget Stabilization Reserve UNDERGROUND STORAGE

TANK INDEMNIFICATION Fund, further providing for funding

TRANSFER; in Pennsylvania Gaming Economic Development and

Tourism Fund, further providing for other grants; in Tobacco

Settlement Fund, further providing for use of fund; in

Pennsylvania Race Horse Development Fund, further providing

for definitions, for fund and for distributions from fund; in

miscellaneous limitations and transfers, further providing

for drug and alcohol programs and providing for Workers'

Compensation Security Fund; in Natural Gas Infrastructure

Development Fund, further providing for definitions and for

transfer of funds; providing for First Chance Trust Fund; in

2016-2017 restrictions on appropriations for funds and

accounts, repealing provisions relating to fund transfers; in

general budget implementation, further providing for

Department of Agriculture, for Department of Community and

Economic Development, for Department of Education, for

Pennsylvania Gaming Control Board, for Department of Human

Services, AND for Commonwealth Financing Authority Restricted

Revenue Account and for surcharges, providing for Multimodal

Transportation Fund, further providing for Pennsylvania

Liquor Control Board and providing for sales by distilleries,

for suspension for inspection deficiencies, for State

Employees' Retirement System Restricted Account and for

Public School Employees' Retirement System Restricted

Account; in school district debt refinancing bonds, further

providing for sinking fund charges for school building

projects, FOR LIMITATION ON NEW APPLICATIONS FOR DEPARTMENT

OF EDUCATION APPROVAL OF PUBLIC SCHOOL BUILDING PROJECTS and

for Public School Building Construction and Reconstruction

Advisory Committee; PROVIDING FOR TOBACCO ANNUITY

LIQUIDATION; repealing provisions relating to 2012-2013

budget implementation and 2012-2013 restrictions on

appropriations for funds and accounts; providing for 2017-

2018 budget implementation and for 2017-2018 restrictions on

appropriations for funds and accounts; making an editorial

change; and making related repeals.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The General Assembly finds and declares as

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follows:

(1) The intent of this act is to provide for the

implementation of the 2017-2018 Commonwealth budget.

(2) The Constitution of Pennsylvania confers numerous

express duties upon the General Assembly, including the

passage of a balanced budget for the Commonwealth.

(3) Section 24 of Article III of the Constitution of

Pennsylvania requires the General Assembly to adopt all

appropriations for the operation of government in this

Commonwealth, regardless of their source. The Supreme Court

has repeatedly affirmed that, "It is fundamental within

Pennsylvania's tripartite system that the General Assembly

enacts the legislation establishing those programs which the

state provides for its citizens and appropriates the funds

necessary for their operation."

(4) Pursuant to section 13 of Article VIII of the

Constitution of Pennsylvania, the General Assembly is

explicitly required to adopt a balanced Commonwealth budget.

Given the unpredictability and potential insufficiency of

revenue collections, various changes in State law relating to

sources of revenue, the collection of revenue and the

implementation of statutes which impact revenue may be

required to discharge this constitutional obligation.

(5) Section 11 of Article III of the Constitution of

Pennsylvania requires the adoption of a general appropriation

act that embraces "nothing but appropriations." While actual

items of appropriation can be contained in a General

Appropriation Act, the achievement and implementation of a

comprehensive budget involves more than subjects of

appropriations and dollar amounts. Ultimately, the budget has

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to be balanced under section 13 of Article VIII of the

Constitution of Pennsylvania. This may necessitate changes to

sources of funding and enactment of statutes to achieve full

compliance with these constitutional provisions.

(6) For the reasons set forth in paragraphs (1), (2),

(3), (4) and (5), it is the intent of the General Assembly

through this act to provide for the implementation of the

2017-2018 Commonwealth budget.

(7) Every provision of this act relates to the

implementation of the operating budget of the Commonwealth

for this fiscal year, addressing in various ways the fiscal

operations, revenues and potential liabilities of the

Commonwealth. To that end, this act is intended to implement

the 2017-2018 Commonwealth budget without specifically

appropriating public money from the General Fund. This act

provides accountability for spending and makes transfers or

other changes necessary to impact the availability of revenue

in order to meet the requirements of section 13 of Article

VIII of the Constitution of Pennsylvania and to implement the

act of July 11, 2017 (P.L. , No.1A), known as the General

Appropriation Act of 2017.

Section 1.1. The act of April 9, 1929 (P.L.343, No.176),

known as The Fiscal Code, is amended by adding a section to

read:

Section 311. Provisions for General Assembly.--(a) Funds

available to the Senate or the House of Representatives through

a short-term agreement or other instrument executed with a

lending institution shall be considered augmenting revenues and

are hereby appropriated for the payment of salaries, wages and

all other expenses incurred in the operation of the Senate or

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the House of Representatives. The amounts shall be remitted to

the State Treasurer for deposit in the account as the Chief

Clerk of the Senate or the Chief Clerk A FLOOR LEADER of the

House of Representatives , AS APPLICABLE, may direct.

(b) Upon presentation of requisitions by the Chief Clerk of

the Senate or the Chief Clerk A FLOOR LEADER of the House of

Representatives, AS APPLICABLE, the requisition shall be paid on

warrant of the State Treasurer directly to and in favor of the

persons designated in the requisition as entitled to receive the

compensation or expenses.

Section 1.2. Section 403 of the act is amended to read:

Section 403. Audits of Agencies Receiving State Aid.--The

Department of the Auditor General shall have the power, and its

duty shall be, to audit the accounts and records of every

person, association, corporation, and public agency, receiving

an appropriation of money, payable out of any fund in the State

Treasury, or entitled to receive any portion of any State tax

for any purpose whatsoever, as far as may be necessary to

satisfy the department that the money received was expended or

is being expended for no purpose other than that for which it

was paid. Copies of all such audits shall be furnished to the

Governor.

If at any time the department shall find that any money

received by any person, association, corporation, or public

agency, has been expended for any purpose other than that for

which it was paid, it shall forthwith notify the Governor, and

shall decline to approve any further requisition for the payment

of any appropriation, or any further portion of any State tax,

to such person, association, corporation or public agency, until

an amount equal to that improperly expended shall have been

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expended for the purpose for which the money improperly expended

was received from the State Treasury.

If an audit completed by the department under this section

makes recommendations, any person, association, corporation, or

public agency being audited shall submit a response to the

department detailing adoption of such recommendations, or the

reason why recommendations have not been adopted, within one

hundred and twenty business days of the publication of the

audit. The department shall provide notice to the subject of an

audit sixty business days after the date of the audit's

publication that future appropriations could be denied for the

person, association, corporation or public agency if a response

is not made.

The department shall regularly notify the Governor, the

chairperson and minority chairperson of the Appropriations

Committee of the Senate and the chairperson and minority

chairperson of the Appropriations Committee of the House of

Representatives of responses received, accompanied by any

comments the department may wish to submit. The department shall

post responses to the department's publicly accessible Internet

website. The Governor, the chairperson and minority chairperson

of the Appropriations Committee of the Senate and the

chairperson and minority chairperson of the Appropriations

Committee of the House of Representatives may consider this

response when determining whether future appropriations to the

person, association, corporation or public agency will be

considered.

If the person, association, corporation or public agency does

not respond to the department within one hundred and twenty

business days from the date of the publication of the audit, the

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department shall notify the Governor, the chairperson and

minority chairperson of the Appropriations Committee of the

Senate and the chairperson and minority chairperson of the

Appropriations Committee of the House of Representatives. The

Governor, the chairperson and minority chairperson of the

Appropriations Committee of the Senate and the chairperson and

minority chairperson of the Appropriations Committee of the

House of Representatives may consider a failure to respond to

the audit when determining whether future appropriations to the

person, association, corporation or public agency will be

considered.

The department shall work with the Governor, chairperson and

minority chairperson of the Appropriations Committee of the

Senate and the chairperson and minority chairperson of the

Appropriations Committee of the House of Representatives to

determine the most effective method to communicate information

concerning responses to the department's audit recommendations

based on the type of audit and significance of the

recommendations.

Section 2. The act is amended by adding a section to read:

Section 410. Audits of Interstate Commissions.--(a) For the

purpose of section 15.11 of the act of July 17, 1968 (P.L.368,

No.181), referred to as the Susquehanna River Basin Compact Law,

the Auditor General shall be deemed to be a duly authorized

officer on behalf of the Commonwealth as a signatory party for

the exclusive purpose of examining and auditing all of the

books, documents, records, files and accounts and all other

papers, things or property of the commission. The designation

under this subsection shall be in addition to any other duly

authorized officer of the Commonwealth under the Susquehanna

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River Basin Compact Law.

(b) For the purpose of section 14.11 of the act of July 7,

1961 (P.L.518, No.268), known as the Delaware River Basin

Compact, the Auditor General shall be deemed to be a duly

authorized officer on behalf of the Commonwealth as a signatory

party for the exclusive purpose of examining and auditing all of

the books, documents, records, files and accounts and all other

papers, things or property of the commission. The designation

under this subsection shall be in addition to any other duly

authorized officer of the Commonwealth under the Delaware River

Basin Compact.

Section 3. Section 1507.1 of the act is amended to read:

Section 1507.1. Settlement Agreements; Enforcement

Actions.--(a) Except as set forth in [subsection (b) and (b.1)]

SUBSECTIONS (B), (B.1), (B.2) AND (B.3), the following apply:

(1) Unless otherwise provided by this section or another

provision of law, money received by an agency as a result of a

settlement, litigation or an enforcement action shall be deemed

funds of the Commonwealth and shall, upon receipt, be deposited

into the General Fund.

(2) If money to pursue a settlement, litigation or

enforcement action was expended by the agency from the General

Fund or other fund or account established by law, those costs

recovered shall be credited to the appropriation, fund or

account from which the original costs were expended and used as

provided by law and shall be available for expenditure in

accordance with the law governing the expenditure.

(3) Amounts that exceed the actual costs of a settlement,

litigation or enforcement action and are deposited in the

General Fund may be redirected to the agency that was the party

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to the settlement, litigation or enforcement action to

supplement the activities of the agency upon request of the

agency and approval of the Secretary of the Budget.

(4) If there is a redirection under paragraph (3), the

secretary shall provide notice of the transfer to the chair of

the Appropriations Committee of the Senate and the chair of the

Appropriations Committee of the House of Representatives and

include a detailed determination of actual costs incurred by the

agency and the identification of the associated settlement,

litigation or enforcement action.

(b) Subsection (a) shall not apply as follows:

(1) The recovery of Federal money shall be disposed of in

accordance with this section and applicable Federal or State law

or contract.

(2) Nothing in this section shall supersede any payments,

including restitution, ordered by a court.

(b.1) Notwithstanding the act of January 8, 1960 (1959

P.L.2119, No.787), known as the "Air Pollution Control Act," or

any other provision of law to the contrary, the sum of

$30,409,055, received from a settlement during the 2017-2018

fiscal year, shall be deemed funds of the Commonwealth and

shall, upon receipt, be deposited into the General Fund to be

expended in compliance with the Commonwealth's trustee duties

under section 27 of Article I of the Constitution of

Pennsylvania.

(B.2) NOTWITHSTANDING ANY OTHER PROVISION OF LAW TO THE

CONTRARY, THE SUM OF $248,830, RECEIVED FROM A SETTLEMENT WITH

AN INSURANCE COMPANY AND A SUBSIDIARY DURING THE 2017-2018

FISCAL YEAR, SHALL BE DEEMED FUNDS OF THE COMMONWEALTH AND

SHALL, UPON RECEIPT, BE DEPOSITED INTO THE GENERAL FUND.

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(B.3) NOTWITHSTANDING ANY OTHER PROVISION OF LAW TO THE

CONTRARY, THE SUM OF $8,300,000, RECEIVED FROM A SETTLEMENT WITH

A DRUG MANUFACTURER DURING THE 2017-2018 FISCAL YEAR, SHALL BE

DEEMED FUNDS OF THE COMMONWEALTH AND SHALL, UPON RECEIPT, BE

DEPOSITED INTO THE GENERAL FUND.

Commonwealth and an agency or instrumentality of the

Commonwealth.

Section 3.1. The act is amended by adding a section to read:

Section 1603-D.1. Payroll tax.

Notwithstanding any provision of law to the contrary, in the

event that the rate of a payroll tax imposed by a city of the

second class A, or a home rule municipality that was previously

a city of the second class A, under section 123(d)(2) of the act

of July 10, 1987 (P.L.246, No.47), known as the Municipalities

Financial Recovery Act, produces less than the revenues

projected in the first full year after the imposition of a

payroll tax, the city may, for a second year, adjust the rate to

one that is sufficient to produce revenues equal to the revenues

collected as a result of the mercantile or business privilege

tax in the final year it was levied. The city may levy the

payroll tax in any subsequent year at a rate not to exceed the

adjusted rate authorized under this section.

Section 3.2 3.1. The definition of "fund" in section 1601-E

of the act is amended to read:

Section 1601-E. Definitions.

The following words and phrases when used in this article

shall have the meanings given to them in this subarticle unless

the context clearly indicates otherwise:

* * *

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"Fund." [The Oil and Gas Lease Fund established under the

act of December 15, 1955 (P.L.865, No.256), entitled, "An act

requiring rents and royalties from oil and gas leases of

Commonwealth land to be placed in a special fund to be used for

conservation, recreation, dams, and flood control; authorizing

the Secretary of Forests and Waters to determine the need for

and location of such projects and to acquire the necessary

land."] The Oil and Gas Lease Fund.

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Section 3.3 3.2. The act is amended by adding a section to

read:

Section 1601.2-E. Oil and Gas Lease Fund.

(a) Continuation.--The Oil and Gas Lease Fund is continued

as a special fund in the State Treasury.

(b) Sources.--The following shall be deposited into the

fund:

(1) Rents and royalties from oil and gas leases of land

owned by the Commonwealth, except rents and royalties

received from game and fish lands.

(2) Amounts as provided under section 5 of the act of

October 8, 2012 (P.L.1194, No.147), known as the Indigenous

Mineral Resources Development Act.

(3) Any other money appropriated or transferred to the

fund.

under subsection (e) or as annually appropriated by the General

Assembly. In making an appropriation from the fund, the General

Assembly shall consider the Commonwealth's trustee duties under

section 27 of Article I of the Constitution of Pennsylvania.

(d) Priority.--Money appropriated from the fund under a

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General Appropriation Act or other appropriation act shall be

distributed prior to allocations under subsection (e).

(e) Annual transfers.--The following apply:

(1) For the 2017-2018 fiscal year and each fiscal year

thereafter, $20,000,000 shall be transferred from the fund to

the Marcellus Legacy Fund for distribution to the

Environmental Stewardship Fund.

(2) For the 2017-2018 fiscal year and each fiscal year

thereafter, $15,000,000 shall be transferred from the fund to

the Marcellus Legacy Fund for distribution to the Hazardous

Sites Cleanup Fund.

Section 4. Section 1607-E(c) of the act is repealed AMENDED

TO READ:

Section 1607-E. Oil and gas operations in the South Newark

Basin.

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[(c) Expiration.--This section shall expire January 1,

[2018] 2024.]

Section 5. The act is amended by adding a section to read:

Section 1610-E. Temporary cessation of oil and gas wells.

(a) General rule.--An oil and gas lessor shall be deemed to

acknowledge that a period of nonproduction under an oil and gas

lease is a temporary cessation insufficient to terminate the

lease and the lessor waives his right to seek lease termination

upon those grounds if, prior to claiming the lease has

terminated:

(1) production is recommenced and the lessor accepts

royalty payments for the production. Any first royalty

payment following recommencement of production after a period

of more than one year of inactivity shall be accompanied by

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an explanation, in plain terms, that acceptance of the

royalty payment shall constitute acknowledgment of an

existing lease with the operator; or

(2) the operator, after notifying the lessor of its

intent to drill a new well and giving the lessor 90 days

within which to object, drills a new well under the lease.

(b) Lease provisions.--Nothing in this section is intended

to waive lease requirements related to commencement of

operations during a lease's primary term or affect a lease

provision expressly providing for lease termination following a

fixed period of nonproduction.

Section 5.1 5. The heading of Article XVI-M of the act,

added July 13, 2016 (P.L.664, No.85), is amended to read:

ARTICLE XVI-M

TRANSPORTATION NETWORK COMPANIES

[AND], MOTOR CARRIER COMPANIES AND PARKING AUTHORITY OF A CITY

OF THE FIRST CLASS

Section 5.2 5.1. The act is amended by adding sections to

read:

Section 1603-M. Regulation of taxicabs and limousines by

parking authority of city of the first class.

For the purpose of the temporary and final-form regulations

required under 53 Pa.C.S. § 57B02(c)(1) (relating to regulation

of taxicabs and limousines) and notwithstanding 53 Pa.C.S. §

5707 (relating to budget and assessments), the owner of a

taxicab authorized by the authority to provide taxicab service

in a city of the first class shall pay to the authority an

assessment equal to 1% of the gross receipts from the fares

charged to passengers for taxicab service in the city of the

first class. The amount assessed must be remitted on a quarterly

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basis to the authority.

Section 1604-M. Penalties.

(a) Suspension or revocation.--In addition to any other

penalties authorized under 53 Pa.C.S. Ch. 57A (relating to

transportation network companies), the authority may suspend or

revoke the license of a transportation network company which

fails to comply with 53 Pa.C.S. § 57A16(n)(2) (relating to

operating regulations).

(b) Definitions.--As used in this section, the following

words and phrases shall have the meanings given to them in this

subsection unless the context clearly indicates otherwise:

"Authority." As defined in 53 Pa.C.S. § 57A01 (relating to

definitions).

"License." As defined in 53 Pa.C.S. § 57A01.

"Transportation network company." As defined in 53 Pa.C.S. §

57A01.

Section 1605-M. Provision of transportation network service.

Notwithstanding any provision under 53 Pa.C.S. § 57A08(a)(5)

(relating to vehicle ownership and standards) or 66 Pa.C.S. §

2606(b) (relating to personal vehicle requirements) to the

contrary, a vehicle up to 15 model years old may be used to

provide transportation network service.

Section 6. Section 1702-A of the act, amended July 13, 2016

(P.L.664, No.85), is amended to read:

Section 1702-A. Funding.

(a) Intent.--It is hereby declared as the intent and goal of

the General Assembly to create a stabilization reserve in an

eventual amount of 6% of the revenues of the General Fund of the

Commonwealth.

(b) Transfer of portion of surplus.--

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(1) Except as may be provided in paragraph (2), for

fiscal years beginning after June 30, 2002, the following

apply:

(i) Except as set forth in this paragraph, if the

Secretary of the Budget certifies that there is a surplus

in the General Fund for a specific fiscal year, 25% of

the surplus shall be deposited by the end of the next

succeeding quarter into the Budget Stabilization Reserve

Fund.

(ii) If the Secretary of the Budget certifies, after

June 30, 2005, that there is a surplus in the General

Fund for the fiscal year 2004-2005, 15% of the surplus

shall be deposited by the end of the next succeeding

quarter into the Budget Stabilization Reserve Fund.

(iii) No amount of the surplus in the General Fund

for fiscal year 2007-2008 may be deposited into the