PRINTER'S NO. 221
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
267
Session of
2019
INTRODUCED BY YUDICHAK, HUGHES, BREWSTER, FONTANA, SANTARSIERO,
COSTA AND FARNESE, FEBRUARY 7, 2019
REFERRED TO COMMUNITY, ECONOMIC AND RECREATIONAL DEVELOPMENT,
FEBRUARY 7, 2019
AN ACT
Establishing the Manufacturing Competitiveness Board within the
Department of Community and Economic Development and
providing for its powers and duties; and providing for a
Commonwealth manufacturing strategy.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the Manufacturing
Competitiveness Act.
Section 2. Findings and declarations.
(a) Findings.--The General Assembly finds as follows:
(1) The manufacturing sector consists of establishments
that are primarily engaged in the transformation of
materials, substances or components into products.
(2) The Commonwealth supports manufacturing in a variety
of ways with manufacturing-related activities scattered in
several agencies in the executive branch.
(3) Manufacturing employment, output and exports are
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impacted by, among other things, tax policies, the state of
infrastructure and transportation, small business
regulations, environmental regulations, innovation
ecosystems, work force development and education initiatives.
(4) Manufacturers account for 12% of the total gross
domestic product output in this Commonwealth, employing more
than 9% of the work force. Total output from manufacturing is
more than $85,150,000,000. There are more than 566,000
manufacturing employees in this Commonwealth, with an average
annual compensation of about $72,500 as of 2015.
(5) Legislative policies and executive actions often
result in unintended, inconsistent and conflicting outcomes
with respect to the growth of manufacturing in this
Commonwealth.
(6) The manufacturing sector is vital to the economic
well-being of this Commonwealth.
(7) The manufacturing industry provides crucial job
opportunities for the middle class.
(8) Other states and foreign jurisdictions have
repeatedly tried to lure Pennsylvania manufacturers to
relocate with the promise of tax breaks and other economic
incentives.
(9) When Pennsylvania manufacturing operations relocate
outside this Commonwealth, it results in a loss of jobs and
income for Pennsylvania families and puts a strain on this
Commonwealth's social safety net.
(10) The Commonwealth needs to take all reasonable
measures to improve the current state of Pennsylvania's
climate as it relates to the manufacturing industry.
(b) Declarations.--The General Assembly declares as follows:
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(1) A well-designed Statewide manufacturing strategy
would benefit the Commonwealth's economy in several important
ways.
(2) A revitalized manufacturing sector would enable this
Commonwealth to derive a larger percentage of economic growth
from exports and domestic production.
(3) Average Commonwealth wages would rise in response to
growing manufacturing output, as manufacturing jobs
historically have paid higher wages and benefits than
nonmanufacturing jobs.
(4) A growing manufacturing sector would help lay a
foundation for future economic growth in this Commonwealth as
manufacturing industries perform the vast share of private-
sector research and development, which fuels the innovation
that serves as a primary engine of economic growth.
Section 3. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Board." The Manufacturing Competitiveness Board established
under section 5.
"Department." The Department of Community and Economic
Development of the Commonwealth.
"Independent agency." As defined in 62 Pa.C.S. § 103
(relating to definitions).
"Manufacturing sector." Any establishment engaged in the
mechanical, physical or chemical transformation of materials,
substances or components into new products.
"Nonprofit organization." An organization that is described
under section 501(c) and exempt from tax under section 501(a) of
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the Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C.
§ 501).
"Private sector experience." Work experience in the private
sector or for-profit sector in any of the following areas:
(1) Managing manufacturing companies, including managing
small business manufacturing companies with less than 100
employees.
(2) Managing supply chain providers.
(3) Managing labor organizations.
(4) Work force development.
(5) Finance.
(6) Analyzing manufacturing policy and competitiveness.
(7) Conducting manufacturing-related research and
development.
"Secretary." The Secretary of Community and Economic
Development of the Commonwealth.
"Sunshine Act." 65 Pa.C.S. Ch. 7 (relating to open
meetings).
Section 4. Chief Manufacturing Officer of the Commonwealth.
(a) Appointment.--The following apply:
(1) Not later than six months after the effective date
of this section, the Governor shall appoint a Chief
Manufacturing Officer of the Commonwealth.
(2) The Governor shall select the Chief Manufacturing
Officer from among individuals who have basic qualifications
and expertise in manufacturing technology and policy.
(3) The position of Chief Manufacturing Officer shall be
in the Executive Office of the Governor and shall report to
the Governor.
(b) Compensation.--The following apply:
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(1) The Executive Board established under the act of
April 9, 1929 (P.L.177, No.175), known as The Administrative
Code of 1929, shall establish the compensation of the Chief
Manufacturing Officer, which shall be commensurate with the
qualification and expertise of the individual appointed.
(2) The Chief Manufacturing Officer shall be reimbursed
for all necessary and actual expenses.
(3) The Chief Manufacturing Officer shall be eligible
for retirement under the State Employees' Retirement Code and
shall, if the member elects to participate, be considered a
State employee for the purposes of 71 Pa.C.S. Pt. XXV
(relating to retirement for State employees and officers).
(c) Duties.--The Chief Manufacturing Officer shall:
(1) Advise the Governor on policy issues that affect the
economic activities and the work force of the manufacturing
sector.
(2) Conduct, through the board, a comprehensive
assessment of the current state of this Commonwealth's
manufacturing sector in accordance with section 5(j) no later
than January 1, 2020.
(3) Develop, through the board, the Commonwealth
manufacturing strategy described in section 6 not later than
July 1, 2020.
(4) Foster the coordination of manufacturing-related
policies and activities across agencies by:
(i) encouraging the use of best innovative
manufacturing practices across State government;
(ii) ensuring the use of best information
technologies and cybersecurity practices for
manufacturing; and
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(iii) analyzing the status of manufacturing
technology needs across independent agencies.
(5) Conduct technology policy analyses to improve
Commonwealth manufacturing productivity, technology and
innovation and cooperate with the Commonwealth's
manufacturing industry in the improvement of Commonwealth
productivity, technology and ability to compete successfully
in world markets.
(6) Identify technological needs, problems and
opportunities within and across the Commonwealth's
manufacturing sector that, if addressed, could make a
significant contribution to the State economy.
(7) Assess whether the capital, technical and other
resources being allocated to manufacturing are likely to
generate new technologies, adequate to meet private and
social demands for goods and services and sufficient to
promote productivity and economic growth.
(8) Encourage the creation of joint initiatives by local
governments, regional organizations, private companies,
institutions of higher education or nonprofit organizations
to encourage technology transfer, to stimulate innovation and
to promote an appropriate climate for investment in
manufacturing-related industries.
(9) Propose manufacturing-related cooperative research
involving appropriate independent agencies, local
governments, regional organizations, institutions of higher
education, nonprofit organizations or private companies to
promote the common use of resources, to improve training
programs and curricula, to stimulate interest in high
technology manufacturing careers and to encourage the
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effective dissemination of manufacturing technology skills
within the wider community.
(10) Serve as a focal point for discussions among
companies that manufacture in this Commonwealth on topics of
interest to the manufacturing industry and work force,
including discussions regarding emerging and advanced
technologies.
(11) Develop strategies and policies that would
encourage manufacturing enterprises to maintain production
facilities and retain manufacturing jobs in this Commonwealth
and use manufacturing supply chains based in this
Commonwealth.
(12) Support communities negatively impacted by the
closure or relocation of manufacturing facilities by
promoting efforts to revitalize communities for new
manufacturing enterprises.
(13) Assist local governments in their economic
development plans for manufacturing and in their efforts to
relocate manufacturing facilities within this Commonwealth
rather than moving manufacturing outside of this
Commonwealth.
(14) Perform such other functions or activities as the
Governor may assign.
Section 5. Manufacturing Competitiveness Board.
(a) Establishment.--The Manufacturing Competitiveness Board
is established within the department for the purpose of
reviewing and making recommendations on the competitiveness of
this Commonwealth's manufacturing sector.
(b) Composition.--The board shall be composed of the
following members:
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(1) The Chief Manufacturing Officer of the Commonwealth.
(2) The secretary or a designee.
(3) The Secretary of Labor and Industry or a designee.
(4) The Secretary of Revenue or a designee.
(5) The Small Business Advocate.
(6) Four members with private sector experience
appointed by the Governor.
(7) One member with private sector experience appointed
by the President pro tempore of the Senate.
(8) One member with private sector experience appointed
by the Minority Leader of the Senate.
(9) One member with private sector experience appointed
by the Speaker of the House of Representatives.
(10) One member with private sector experience appointed
by the Minority Leader of the House of Representatives.
(c) Terms.--Except for the initial appointments, members of
the board appointed under subsection (b)(6) shall serve terms of
four years.
(d) Chair.--The Chief Manufacturing Officer of the
Commonwealth shall serve as the chair of the board.
(e) Quorum.--A majority of the members appointed to the
board shall constitute a quorum for purposes of transacting the
business of the board.
(f) Meetings.--The board shall hold its first meeting within
60 days of the appointment of the Chief Manufacturing Officer
and shall meet quarterly but may meet more frequently if deemed
necessary by the board in order to carry out the purposes of
this act.
(g) Compensation.--Board members shall not receive
compensation for their participation on the board. Board members
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may be reimbursed for reasonable expenses incurred in relation
to the attendance of board meetings and hearings.
(h) Hearings.--The board may hold hearings for the purpose
of fact-finding on issues related to manufacturing
competitiveness. Any hearings held by the board shall be subject
to the Sunshine Act.
(i) Administrative support.--The department shall make
office space available to the board. The department shall
provide administrative support and any other technical
assistance required by the board to carry out its duties under
this act.
(j) Assessment.--The board shall work with the department to
conduct a comprehensive assessment of the laws, regulations,
policies and procedures of this Commonwealth and of other states
related to the manufacturing sector and market competitiveness.
The board's assessment, analysis and recommendations shall
include, but not be limited to, the following areas:
(1) The state of this Commonwealth's existing
manufacturing sector.
(2) This Commonwealth's regulatory climate as it relates
to the manufacturing sector.
(3) The Commonwealth's current programs and tax
incentives made available to the manufacturing sector.
(4) This Commonwealth's manufacturing competitiveness
and how it compares to other states.
(5) Programs and tax incentives benefiting the
manufacturing sector in other states and the cost of
implementing similar programs in this Commonwealth.
(6) Federal programs and incentives that are currently
available to assist and stimulate growth in the manufacturing
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sector.
(7) Other manufacturing issues deemed appropriate by the
board, including, but not limited to:
(i) Work force skills, gaps and development.
(ii) Statistics on manufacturing productivity,
output and growth.
(iii) Programs to help small and mid-sized
manufacturers become more competitive.
(iv) Impact of Commonwealth tax policy.
(v) Financing and investment, including challenges
associated with commercialization and scaling up
production.
(vi) Job creation and employment disparities.
(vii) Levels of Commonwealth production.
Section 6. Commonwealth manufacturing strategy.
(a) Requirements.--The Commonwealth manufacturing strategy
developed under section 4(c)(3) shall contain the comprehensive
assessment of the current state of manufacturing completed under
section 4(c)(2) and comprehensive strategies and recommendations
for:
(1) identifying and addressing the anticipated work
force needs of the manufacturing sector;
(2) strengthening education and the required training
and certifications for manufacturing;
(3) creating training and appropriate career paths to
manufacturing jobs for veterans and others that have become
unemployed;
(4) promoting the development of quality control and
other technical standards;
(5) maintaining reliable physical and telecommunications
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infrastructure, and the required investments in
infrastructure projects, as needed, for manufacturing;
(6) analyzing the status of manufacturing technology
needs in the industrial sector and providing recommendations
for economic and labor force expansions;
(7) monitoring technology directions and analyzing
strengths, weaknesses, threats and opportunities in this
Commonwealth's manufacturing sector;
(8) implementing appropriate tax incentives and credits
to assist manufacturing enterprises in improving
competitiveness;
(9) recommending State laws, regulations and policies to
reduce the cost of manufacturing and improve productivity;
(10) promoting the export of Commonwealth-manufactured
goods;
(11) identifying other forms of assistance to companies
that manufacture in this Commonwealth to successfully compete
in world markets; and
(12) addressing other issues as the Governor determines
necessary.
(b) Updates.--The Chief Manufacturing Officer may update the
Commonwealth manufacturing strategy on a continuing basis or as
necessary to ensure the competitiveness of this Commonwealth's
manufacturing sector.
Section 7. Report.
(a) Submission.--Beginning in calendar year 2020, the
Governor shall submit an annual report outlining the
manufacturing competitiveness strategy, including its findings
and recommendations, no later than September 30, to the
following:
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(1) The President pro tempore of the Senate.
(2) The Majority Leader of the Senate.
(3) The Minority Leader of the Senate.
(4) The Speaker of the House of Representatives.
(5) The Majority Leader of the House of Representatives.
(6) The Minority Leader of the House of Representatives.
(b) Publication.--Upon submission of the report required
under subsection (a), the Governor shall transmit notice of the
submission of the report to the Legislative Reference Bureau for
publication in the Pennsylvania Bulletin.
Section 8. Effective date.
This act shall take effect in 60 days.
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