72 Pa. Stat. § 8802-C

Current through Pa Acts 2024-53, 2024-56 through 2024-111

Section 8802-C - Definitions

The following words and phrases when used in this article shall have the meanings given to them in this section unless the context clearly indicates otherwise:

"Baseline tax amount." The amount of State or local eligible taxes paid relating to each qualified business that is not a new business, less eligible State or local tax refunds, relating to each qualified business for the first full calendar year in which the qualified business established a presence in the zone.

"Baseline year." The calendar year in which a zone was established.

"Bond." The term includes any public or private financing, note, mortgage, loan, deed of trust, instrument, refunding note or other evidence of indebtedness or obligation.

"Business personal property." The term includes furniture, fixtures, equipment and other similar property purchased and used in the zone.

"City." A city of the second class a or third class or a home rule city or a municipality with a population of at least 20,000 based on the most recent Federal decennial census. The term does not include a city that is determined to be distressed under the act of July 10, 1987 (P.L.246, No.47), known as the Municipalities Financial Recovery Act.

"City revitalization and improvement zone." An area of not more than 130 acres in a city or municipality, that may include an area in one or more contiguous municipalities, comprised of parcels designated by the contracting authority, which will provide economic development and job creation within a city or one or more contiguous municipalities.

"Contracting authority."

A new or existing authority established or designated by a city, municipality or home rule county to designate and administer zones. The term shall include:

(i) An authority established under 53 Pa.C.S. Ch. 56 (relating to municipal authorities).

(ii) An authority established under the former act of December 27, 1994 (P.L.1375, No.162), known as the Third Class County Convention Center Authority Act, or under Article XXIII(n) or (o) of the act of August 9, 1955 (P.L.323, No.130), known as the County Code.

(iii) An authority established by a contiguous municipality under 53 Pa.C.S. Ch. 56 for the purposes of this act.

"Department." The Department of Revenue of the Commonwealth.

"Earned income tax." A tax imposed on earned income within a zone under the act of December 31, 1965 (P.L.1257, No.511), known as The Local Tax Enabling Act, which a city, or a school district contained entirely within the boundaries of or coterminous with the city, is entitled to receive.

"Eligible tax." Any of the following taxes:

(1) Corporate net income tax, capital stock and franchise tax, bank shares tax, personal income tax paid by shareholders, members or partners of Subchapter S corporations, limited liability companies, partnerships or sole proprietors on income other than passive activity income as defined under section 469 of the Internal Revenue Code of 1986 (Public Law 99-516, 26 U.S.C. § 1 et seq.) or business privilege tax, calculated and apportioned as to amount attributable to the location within the zone and calculated under section 1904-B(b) and (c).

(1.1) For a zone designated after July 1, 2024, insurance premiums tax, calculated and apportioned as to the amount attributable to the location within the zone and calculated under section 1904-B(c).

(2) Amusement tax, only to the extent the tax is related to the activity of a qualified business within the zone.

(3) Sales and use tax, only to the extent the tax is related to the activity of a qualified business within the zone. The term includes sales and use taxes on material used for construction in the zone and business personal property to be used by the qualified business in the zone.

(3.1) The hotel occupancy tax imposed under Part V of Article II.

(4) Personal income tax withheld from its employees by a qualified business for work performed in the zone.

(5) Local services tax withheld from its employees by a qualified business for work performed in the zone.

(6) Earned income tax withheld from its employees by a qualified business for work performed in the zone.

(7) All taxes paid to the Commonwealth , or an amount equal to all of the taxes paid to the Commonwealth, related to the purchase or sale of liquor, wine or malt or brewed beverages by a licensee located in the zone for purchases that occurred outside the zone.

The term does not include cigarette tax.

"Facility." A structure or complex of structures in a zone to be used for commercial, industrial, sports, exhibition, hospitality, conference, retail, community, office, recreational or mixed-use purposes.

"Increment." The amount of eligible taxes generated by a new business, taxes excluded from the baseline tax amount pursuant to section 1810-C(b)(3), and amount of eligible taxes generated by a qualified business above the qualified business's baseline tax amount.

"Infrastructure." Any improvements in or out of the zone that the contracting authority determines to be related to the development of a facility in the zone, including, but not limited to, improvements to utilities, water, sewer, storm water, parking, road improvements or telecommunications within the city or municipality or within a municipality contiguous to that city or municipality.

"Licensee" shall mean an individual licensed under the act of April 12, 1951 (P.L.90, No.21), known as the Liquor Code.

"Lobbyist." As defined in 65 Pa.C.S. § 13A03 (relating to definitions).

"Municipality." An incorporated town, a township or a borough. The term does not include an incorporated town, a township or a borough that is determined to be distressed under the Municipalities Financial Recovery Act.

"New business." Any of the following:

(1) any new or separate legal entity that locates or has a location in the zone; or

(2) a business already located in this Commonwealth and conducting operations outside the zone which expands into the zone with a new operation as evidenced by a new facility, business personal property, products or additional employees and continues operations outside the zone without substantial change in business. Only eligible taxes related to activity within the zone shall be attributable to the location in the zone.

"Office." The Office of the Budget.

"Pilot zone." An area of not more than 100 acres designated by the contracting authority prior to July 1, 2024, following application and approval by the Department of Community and Economic Development, the office and the department which will provide economic development and job creation within one or more municipalities, with a total population of at least 7,000 based on the most recent Federal decennial census.

"Professional services." Any of the following:

(1) Legal services.

(2) Advertising or public relations services.

(3) Engineering services.

(4) Architectural, landscaping or surveying services.

(5) Accounting, auditing or actuarial services.

(6) Security consultant services.

(7) Computer and information technology services, except telephone service.

(8) Insurance underwriting services.

(9) Compliance services.

(10) Financial auditing services.

"Qualified business." As follows:

(1) An entity located or partially located in a zone which meets the requirements of all of the following:

(i) Has conducted an active trade or business in the zone.

(ii) Appears on the timely filed list under section 1807-C(a).

(2) A construction contractor engaged in construction, including infrastructure or site preparation, reconstruction or renovation of a facility .

(3) The term does not include an agent, broker or representative of a business.

"Zone." Any of the following:

(1) A city revitalization and improvement zone.

(2) A pilot zone.

"Zone Fund." A city revitalization and improvement zone or pilot zone fund established under section 1808-C.

72 P.S. § 8802-C

Amended by P.L. (number not assigned at time of publication) 2024 No. 56,§ 13, eff. 7/11/2024.

Amended by P.L. TBD 2019 No. 13, § 17.1, eff. 7/1/2019.

Amended by P.L. TBD 2016 No. 84, § 34, eff. 7/13/2016.

Amended by P.L. TBD 2014 No. 194, § 12, eff. 10/31/2014.

Added by P.L. 270 2013 No. 52, § 31, eff. 7/9/2013.