TAX-EXEMPT BOND ALLOCATION ACT - REPEALED — 1985 Pa. Act 113 (historical enacted text)

Historical Act text

HOUSE AMENDED
PRIOR PRINTER'S NOS. 1548, 1572, 1606, PRINTER'S NO. 1705
1684
INTRODUCED BY SHAFFER, SINGEL, JUBELIRER, SALVATORE AND
PETERSON, NOVEMBER 8, 1985
AS AMENDED ON THIRD CONSIDERATION, HOUSE OF REPRESENTATIVES,
DECEMBER 11, 1985
AN ACT
1 Providing for the allocation of private activity bonds subject <--
2 to a State ceiling under Federal legislation.
3 PROVIDING FOR TAX-EXEMPT BONDS; AND IMPOSING POWERS AND DUTIES <--
4 ON THE SECRETARY OF COMMERCE.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. Short title. <--
8 This act shall be known and may be cited as the Private
9 Activity Bonds Allocation Act.
10 Section 2. Definitions.
11 The following words and phrases when used in this act shall
12 have the meanings given to them in this section unless the
13 context clearly indicates otherwise:
14 "County's ceiling limit." The maximum allocation made to a
15 county under the formula set forth in section 5(b).
16 "Department." The Department of Commerce of the
17 Commonwealth.
1 "Eligible project costs." Costs of the project which may be
2 financed under the legislative authority for issuance of private
3 activity banks for the project.
4 "Enterprise development area." A geographical area
5 designated as such by the Secretary of Community Affairs under
6 the act of July 2, 1984 (P.L.520, No.105), known as the Business
7 Infrastructure Development Act.
8 "Exempt facilities." Projects with socially desirable
9 benefits as defined by regulations promulgated by the department
10 under section 3. The term includes projects for pollution
11 control, sewage treatment disposal and municipal waste disposal;
12 airports; and similar projects.
13 "Inducement resolution." A resolution authorizing a local
14 issuing authority to issue private activity bonds.
15 "Issuing authority." A government entity which is authorized
16 to issue private activity bonds.
17 "Preliminary allocation request." The initial request for an
18 allocation made by a legally authorized issuing authority to the
19 department.
20 "Prior years' usage." The average use of small issue private
21 activity bonds for the years 1979 through 1983 on a county
22 basis.
23 "Private activity bonds." Industrial development and student
24 loan bonds.
25 "Professional business." A business enterprise limited under
26 this act to doctors, lawyers and accountants.
27 "Professional office buildings." A commercial building
28 having more than 25% of its floorspace occupied by doctors,
29 dentists, lawyers and accountants, and their support staff.
30 "Project ceiling limit." The maximum allocation made to a
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1 project as set forth in section 3(c).
2 "Retail projects." An enterprise where more than 50% of
3 sales of durable and nondurable goods are to final or ultimate
4 consumers.
5 "Secretary." The Secretary of Commerce of the Commonwealth.
6 "Small issues." Private activity bonds subject to the
7 principal amount restrictions under section 103(b)(6) of the
8 Internal Revenue Code of 1954 (68A Stat. 3, 26 U.S.C. §
9 103(b)(6)).
10 "State ceiling." Maximum amount of private activity bonds
11 which may be issued in this Commonwealth in a given year as
12 provided in section 103(n)(4) of the Internal Revenue Code of
13 1954 (68A Stat. 3, 26 U.S.C. § 103(n)(4)).
14 Section 3. Administration.
15 (a) Regulations.--The department shall implement this act by
16 promulgating regulations within 90 days of the effective date of
17 this act, to administer the issuance of allocations to
18 accomplish the following:
19 (1) Promote an incentive to issuing authorities to
20 utilize industrial development bonds to the maximum benefit
21 of the community in accordance with the generally accepted
22 standards of the community.
23 (2) Promote economic development in this Commonwealth.
24 (3) Promote higher education within this Commonwealth.
25 (4) Maintain fiscal accountability for allocations.
26 (5) Create and maintain employment within this
27 Commonwealth.
28 (b) Considerations.--In promulgating regulations under
29 subsection (a), the department shall consider:
30 (1) The characteristics and merits of the individual
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1 projects proposed.
2 (2) The record of the issuing authority in utilizing
3 industrial development financing to create and retain
4 employment.
5 (c) Project limit.--The maximum allocation for projects
6 using private activity bonds shall not exceed 80% of eligible
7 project costs. Applicants which employ less than 50 full-time
8 workers within this Commonwealth as certified by the authorized
9 issuing authority and are not subject to the restrictions placed
10 on retail and commercial office projects shall be limited to 90%
11 of total project costs.
12 (d) Future allocations.--The secretary shall apply the
13 formula as stated in this act to all future State allocations as
14 stipulated by the Tax Reform Act of 1984 (Public Law 98-369, 98
15 Stat. 494) as amended, or to any future Federal legislation that
16 may control these allocations.
17 Section 4. Allocation.
18 The allocation allotted to the Commonwealth for tax exemption
19 under section 103(n)(4) of the Internal Revenue Code of 1954
20 (68A Stat. 3, 26 U.S.C. § 103(n)(4)) shall be allocated by the
21 Commonwealth for reallocation under sections 5, 6 and 7.
22 Section 5. Counties.
23 (a) Amount.--An allocation equal to $1,098,783,000 of the
24 amount allotted to the Commonwealth under section 4 is allocated
25 for use by issuing authorities for industrial parks and small
26 issues.
27 (b) Allocation.--The amount allocated under subsection (a)
28 shall be allocated geographically, by county, in accordance with
29 the following formula:
30 (1) One third of two times the average county usages for
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1 the years 1979 through 1983 inclusive as a percentage of the
2 State average usage for the years 1979 through 1983
3 inclusive, plus the population of the county as a percentage
4 of the State population, times 67% of the total State
5 allocation.
6 (2 x county average usage + county population)/3 x
7 (67% of State allocation) = county allocation.
8 (2) A county which used 25% or more of its 1985
9 allocation as determined by the Governor's proclamation shall
10 be limited to 150% of its 1985 usage through September 30,
11 1985.
12 (3) A county which used less than 25% of its 1985
13 allocation as determined by the Governor's proclamation shall
14 be allocated 50% of the amount computed by the formula above.
15 (4) A county for which the formula provides less than
16 its 1985 usage shall receive an allocation equal in amount to
17 its 1985 usage.
18 (5) Each county shall receive an additional allocation
19 equal to the percentage by which its 1984 county unemployment
20 rate exceeded the 1984 State unemployment rate. Counties with
21 unemployment rates below the State average will receive the
22 allocation subject to the above criteria.
23 Allocation = County Allocation x (County
24 Unemployment Rate - State Unemployment Rate).
25 (6) All allocations shall be rounded to the nearest
26 thousand.
27 (c) Professional office building projects.--No professional
28 office building project shall be eligible for tax-exempt private
29 activity bond allocation.
30 (d) Commercial projects.--Commercial projects within this
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1 section shall be considered in accordance with the following:
2 (1) Approved funding allocations shall not be for more
3 than 80% of the total eligible project cost or $2,000,000,
4 whichever is less.
5 (2) Office buildings used as corporate, national or
6 regional headquarters for industrial or manufacturing
7 industries shall be exempt from this section but subject to
8 limitations in accordance with section 3(c).
9 (3) Projects located within an enterprise development
10 area, or municipalities which meet the distress criteria of
11 section 6 of the act of July 2, 1984 (P.L.520, No.105), known
12 as the Business Infrastructure Development Act, or in
13 communities which have been designated as Federal Disaster
14 Relief Areas, for the entire period of such Federal
15 designation, provided that such projects are reasonably
16 related to the replacement, reconstruction or rehabilitation
17 of facilities or equipment destroyed or damaged by natural
18 disaster shall be exempt for the $2,000,000 limitation.
19 (e) Retail projects.--All issuing authorities are permitted
20 to use tax-exempt private activity bonds for retail projects in
21 accordance with the following:
22 (1) The amount of project financing shall be the lesser
23 of 80% of eligible project costs, or $1,000,000.
24 (2) Projects located within an enterprise development
25 area, or municipalities which meet the distress criteria of
26 section 6 of the act of July 2, 1984 (P.L.520, No.105), known
27 as the Business Infrastructure Development Act, or in
28 communities which have been designated as Federal Disaster
29 Relief Areas, for the entire period of such Federal
30 designation, provided that such projects are reasonably
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1 related to the replacement, reconstruction or rehabilitation
2 of facilities or equipment destroyed or damaged by natural
3 disaster, shall be exempt from the $1,000,000 limitation.
4 (f) Mixed usage.--An allocation shall be determined by the
5 criteria governing the use to which more than 50% of floor space
6 is assigned.
7 (g) Grants.--Allocations shall be granted in chronological
8 order of receipt of the preliminary allocation request for a
9 qualified project. Allocations shall be granted until the
10 county's ceiling limit is reached.
11 (h) Location.--The geographic location of the project shall
12 determine which county's ceiling limit shall be utilized.
13 Section 6. Secretary.
14 (a) Amount.--An allocation equal to $624,462,000 of the
15 amount allotted to the Commonwealth under section 4 is allocated
16 to the department for use under this section.
17 (b) Special allocation pool.--The department shall reserve
18 $100,000,000 of the amount allocated under subsection (a) for
19 transfer, in conjunction with the Secretary of the Budget, to
20 county allocations under section 5 in accordance with the
21 following:
22 (1) To qualify to use this pool, issuing authorities
23 must demonstrate to the department's satisfaction that they
24 have acted responsibly in selecting projects which maximize
25 long-term employment creation and retention.
26 (2) Projects shall be considered for allocations under
27 this subsection if the entire allocation for the county in
28 which the project is proposed has been utilized or is
29 insufficient to meet project expenses.
30 (3) In determining grants under this subsection, the
19850S1204B1705 - 7 -
1 department shall consider:
2 (i) The amount of the original allocation available.
3 (ii) The level of economic distress in the
4 community.
5 (iii) The ability to undertake the project without
6 the allocation.
7 (iv) The date the private activity bonds are to be
8 issued.
9 (v) The characteristics and merits of the proposed
10 projects.
11 (vi) The record of the issuing authority in
12 utilizing private activity bond financing to create and
13 retain employment.
14 (4) No county shall receive allocations under this
15 subsection totaling more than $10,000,000.
16 (5) Projects located within an enterprise development
17 area, or municipalities which meet the distress criteria of
18 section 6 of the Business Infrastructure Development Act, or
19 in communities which have been designated as Federal Disaster
20 Relief Areas, for the entire period of such Federal
21 designation, provided that such projects are reasonably
22 related to the replacement, reconstruction or rehabilitation
23 of facilities or equipment destroyed or damaged by natural
24 disaster shall be exempt for the $1,000,000 limitation.
25 (c) Exempt facilities allocation pool.--The department shall
26 reserve $484,362,000 of the amount allocated under subsection
27 (a) for exempt facilities in accordance with the following:
28 (1) An allotment of at least 25% of the allocation
29 stated in this subsection shall be reserved for municipal
30 solid waste disposal projects. Each project allocation shall
19850S1204B1705 - 8 -
1 be limited to no more than 70% of eligible project costs.
2 (2) Allocations for projects up to $50,000,000 of the
3 allocation reserved under this subsection shall be granted in
4 chronological order of receipt of preliminary allocation
5 requests. For purposes of this paragraph, multiple allocation
6 request for the same project shall be aggregated and
7 considered as one request.
8 (3) Allocations for projects in excess of $50,000,000 of
9 the allocation reserved under this subsection must be
10 approved by the department on the basis of the following:
11 (i) The amount of the allocation available.
12 (ii) The size of the project.
13 (iii) The effect on environmental policy.
14 (iv) The number of jobs to be created and retained.
15 (v) The ability to undertake the project without the
16 grant.
17 (vi) The date the private activity bonds are to be
18 issued.
19 Section 7. Commonwealth.
20 An allocation equal to $105,000,000 of the amount allotted to
21 the Commonwealth under section 4 is allocated for use by
22 agencies, other than issuing authorities, of the Commonwealth.
23 Section 8. Preliminary allocation requests.
24 (a) General rule.--In order to qualify for an allocation
25 under section 5 or 6, issuing authorities must submit to the
26 department a preliminary allocation request establishing
27 eligibility under this act.
28 (b) Additional requirements.--Small issue, industrial park
29 and exempt facilities private activity bonds under sections 5
30 and 6 are also subject to the following:
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1 (1) The department shall not accept preliminary
2 allocation requests until the following have been met:
3 (i) The inducement resolution has been passed.
4 (ii) The hearings under section 103(k)(2)(B)(i) of
5 the Internal Revenue Code of 1954 (68A Stat. 3, 26 U.S.C.
6 § 103(k)(2)(B)(i)) have been completed.
7 (iii) Approvals of highest elected officials
8 required under section 103(k) of the Internal Revenue
9 Code of 1954 (68A Stat. 3, 26 U.S.C. § 103(k)) have been
10 obtained.
11 (iv) The project has been approved by the secretary
12 in accordance with the act of August 23, 1967 (P.L.251,
13 No.102), known as the Industrial and Commercial
14 Development Authority Law; or the project has been
15 otherwise approved under the law of this Commonwealth.
16 (2) The department shall make preliminary allocations if
17 it determines that the issuing authority is eligible under
18 this act.
19 (3) Issuing authorities which receive preliminary
20 allocations under paragraph (2) must issue private activity
21 bonds within 90 days of the date of the preliminary
22 allocation or by December 31 of the year in which the
23 preliminary application is made, whichever date is earlier.
24 Failure to comply with this paragraph shall result in the
25 loss of the allocation. Issuing authorities may submit
26 subsequent preliminary allocation requests for allocations
27 lost under this paragraph in accordance with regulations
28 promulgated under section 3.
29 (4) An increase in the amount of the private activity
30 bonds after a preliminary allocation has been made shall
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1 require a new preliminary allocation request for the
2 increased amount.
3 (5) Issuing authorities receiving a preliminary
4 allocation must submit Form 8038 to the department and the
5 Internal Revenue Service within 15 days of the date of the
6 bond issue. Failure to comply with this paragraph shall
7 result in loss of the allocation. Issuing authorities may
8 submit a subsequent preliminary allocation request for
9 allocations lost under this paragraph in accordance with
10 regulations promulgated under section 3.
11 (6) If the preliminary allocation request is made after
12 September 30, the issuing authority must provide substantial
13 evidence that private activity bonds will be issued by
14 December 31 of the same year.
15 (7) Issuing authorities which have not issued private
16 activity bonds by November 30 of the year in which the
17 preliminary allocation was made must provide substantial
18 evidence that the private activity bonds will be issued by
19 December 31 of that year. If the issuing authority fails to
20 comply with this paragraph, the department shall rescind the
21 preliminary allocation.
22 (8) The department shall finalize preliminary
23 allocations in accordance with regulations promulgated under
24 section 3.
25 (9) An increase in the amount of private activity bonds
26 after final allocation shall be treated as a new project.
27 (10) Allocations may not be granted to issuing
28 authorities using private activity bonds for interim
29 financing pending receipt of Federal, State or local loans,
30 loan guarantees or grant funds.
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1 Section 9. Prohibition.
2 Allocations may not be made:
3 (1) For professional office buildings except those
4 projects that qualify under section 5(d).
5 (2) For retail projects unless the projects qualify
6 under section 5(e).
7 (3) To issuing authorities using private activity bonds
8 for interim financing pending receipt of Federal, State or
9 local loans, loan guarantees or grant funds.
10 Section 10. Reallocation.
11 Unobligated portions of allocations shall revert to the
12 department on October 1 of each year. The department shall
13 reallocate the unused amounts under section 5, 6 or 7 by
14 November 1 of each year. Reallocations shall be as follows:
15 (1) If the allocation was made under section 5, then the
16 reallocation shall be made under section 5.
17 (2) If the allocation was made under section 5(e), 6(b)
18 or 7:
19 (i) Sixty percent of the reallocation shall be made
20 under section 6(c).
21 (ii) Forty percent of the reallocation shall be made
22 under section 7.
23 (3) If the reallocation or any part of the reallocation
24 is not required, the secretary shall determine the best
25 utilization of the remaining allocation.
26 Section 11. Applicability.
27 This act shall apply to private activity bonds issued after
28 December 31, 1985.
29 Section 12. Prior project approvals.
30 All projects approved in 1985, but for which Preliminary
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1 Allocation Requests were granted, may receive their Preliminary
2 Allocation Request in 1986 subject to the 1985 proclamation and
3 the county's 1986 allocation limits. Allocations shall be made
4 prior to the adoption of regulations required under section 3.
5 Section 13. Effective date.
6 This act shall take effect immediately.
7 SECTION 1. SHORT TITLE. <--
8 THIS ACT SHALL BE KNOWN AND MAY BE CITED AS THE TAX-EXEMPT
9 BOND ALLOCATION ACT.
10 SECTION 2. PURPOSE.
11 A TAX-EXEMPT BOND ALLOCATION FORMULA IS ESTABLISHED IN
12 RESPONSE TO RESTRICTIONS IMPOSED BY AMENDMENTS TO THE INTERNAL
13 REVENUE CODE OF 1954 (68A STAT. 3, 26 U.S.C. § 1 ET SEQ.).
14 BECAUSE OF THE LIMITS ON THE AMOUNTS OF TAX-EXEMPT BOND FUNDING
15 AVAILABLE, THIS ACT IS INTENDED TO USE THE RESTRICTED FUNDING
16 AVAILABLE IN ORDER TO:
17 (1) CREATE CAREER-ORIENTED NET NEW JOBS OR PRESERVE JOBS
18 AT AN INCOME LEVEL HIGH ENOUGH TO SUPPORT AN INDIVIDUAL AND
19 THE INDIVIDUAL'S DEPENDENTS.
20 (2) INCREASE AND DIVERSIFY THE MANUFACTURING BASE OF
21 THIS COMMONWEALTH.
22 (3) AID IN THE EXPANSION OF EXISTING PRIVATE COMPANIES,
23 PARTICULARLY THOSE WHICH SELL THEIR PRODUCTS OUTSIDE THIS
24 COMMONWEALTH.
25 (4) ATTRACT NEW INDUSTRIES WITH NEW PRODUCTS INTO
26 DISTRESSED AREAS WITHIN THIS COMMONWEALTH.
27 (5) PREPARE THE NECESSARY PERSONNEL, THROUGH A PROGRAM
28 OF EDUCATIONAL FINANCIAL ASSISTANCE TO POSTSECONDARY
29 STUDENTS, THEIR FAMILIES AND OTHERS PROVIDING EDUCATIONAL
30 OPPORTUNITIES TO STUDENTS AND THEIR FAMILIES, TO ASSUME THE
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1 MANPOWER AND ADMINISTRATIVE LEADERSHIP ROLES REQUIRED TO
2 CARRY OUT THE OBJECTIVES OF PARAGRAPHS (1) THROUGH (4).
3 SECTION 3. DEFINITIONS.
4 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS ACT SHALL
5 HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE
6 CONTEXT CLEARLY INDICATES OTHERWISE:
7 "EXEMPT FACILITIES." PROJECTS WHICH ARE DETERMINED BY THE
8 FEDERAL GOVERNMENT NOT TO BE SUBJECT TO SMALL-ISSUE PROJECT
9 LIMITATIONS. EXAMPLES MAY BE POLLUTION CONTROL FACILITIES,
10 AIRPORTS AND WASTE-DISPOSAL SITES.
11 "NET NEW JOB." A FULL-TIME JOB, OR ITS EQUIVALENT, WHICH
12 INCREASES THE NUMBER OF JOBS AT THE PROJECT SITE ABOVE THE
13 NUMBER OF JOBS PRESENT BEFORE THE PROJECT IS STARTED. THE TERM
14 DOES NOT INCLUDE A JOB WHICH:
15 (1) IS BEING RELOCATED FROM WITHIN THIS COMMONWEALTH.
16 (2) IS CREATED BY THE CONSTRUCTION OF THE PROJECT.
17 (3) IS NOT DESIGNED TO BE PERMANENT.
18 "PROJECT." AN ACTIVITY FOR WHICH TAX-EXEMPT BONDS MAY BE
19 USED.
20 "SECRETARY." THE SECRETARY OF COMMERCE OF THE COMMONWEALTH.
21 "TAX-EXEMPT BONDS." PRIVATE ACTIVITY AND OTHER BONDS AND
22 FINANCINGS WHICH COUNT AGAINST THE STATE CEILING DEFINED IN THE
23 INTERNAL REVENUE CODE OF 1954 (68A STAT. 3, 26 U.S.C. § 1 ET
24 SEQ.).
25 SECTION 4. SELECTION OF PROJECTS.
26 (A) PROJECTS USING COUNTY ALLOCATIONS.--
27 (1) EXCEPT UNDER PARAGRAPH (2), THE SECRETARY SHALL NOT
28 APPROVE BOND PROJECTS UNDER THE ACT OF AUGUST 23, 1967
29 (P.L.251, NO.102), KNOWN AS THE INDUSTRIAL AND COMMERCIAL
30 DEVELOPMENT AUTHORITY LAW, FOR:
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1 (I) PROJECTS RELATED TO THE RETAIL SALE OF CONSUMER
2 GOODS, EXCEPT THAT NO MORE THAN 5% OF THE ALLOCATION OF <--
3 EACH COUNTY, AS PROVIDED BY SECTION 5(A)(1), MAY BE
4 UTILIZED FOR SUCH PROJECTS, AND THE AMOUNT FINANCED IN
5 ANY SUCH PROJECT MAY NOT EXCEED $1,000,000.
6 (II) OFFICE BUILDINGS IN WHICH 75% 50% OR LESS OF <--
7 THE SQUARE FOOTAGE HAS GUARANTEED OCCUPANCY. OFFICE <--
8 BUILDINGS WHICH RECEIVE FINANCING SHALL BE LIMITED TO
9 $2,000,000 IN FINANCING. THIS SUBPARAGRAPH DOES NOT APPLY
10 TO OFFICE BUILDINGS USED TO HOUSE REGIONAL OR NATIONAL
11 CORPORATE HEADQUARTERS.
12 (III) OFFICE BUILDINGS WHOSE PRIMARY TENANTS WILL BE <--
13 DOCTORS, LAWYERS, ACCOUNTANTS OR OTHER PROFESSIONALS WHOM
14 THE SECRETARY DESIGNATES IN REGULATIONS PROMULGATED UNDER
15 SECTION 6(4). WITH MORE THAN 20% OF THE SQUARE FOOTAGE <--
16 OCCUPIED BY DOCTORS, LAWYERS, ACCOUNTANTS, DENTISTS OR
17 OTHER PROFESSIONALS.
18 (IV) PROJECTS WHICH WILL NOT GENERATE AT LEAST ONE
19 NET NEW JOB OR PRESERVE ONE FULL-TIME JOB FOR EVERY
20 $50,000 OF BOND AUTHORITY.
21 (V) PROJECTS WHICH REQUIRE OVER $5,000,000 IN TAX- <--
22 EXEMPT BONDS.
23 (VI) (V) PROJECTS WHOSE BENEFICIARY HAS OUTSTANDING <--
24 TAX-EXEMPT BOND INDEBTEDNESS FOR A PROJECT WHICH WAS
25 INITIATED AFTER JANUARY 1, 1984, AND WHICH DOES NOT MEET
26 JOB PROJECTIONS WITHIN TWO THREE YEARS FOLLOWING ITS <--
27 COMPLETION.
28 (2) THE SECRETARY MAY WAIVE, ON A PROJECT-BY-PROJECT <--
29 BASIS, THE EXCLUSIONS IN PARAGRAPH (1)(I) THROUGH (V) FOR
30 REASONS SPECIFIED BY THE SECRETARY IN THE SEMIANNUAL REPORT
19850S1204B1705 - 15 -
1 UNDER SECTION 7(3). THE SECRETARY SHALL MAKE THE WAIVER UNDER
2 THIS PARAGRAPH FOR PROJECTS LOCATED WITHIN ENTERPRISE
3 DEVELOPMENT AREAS, AS CERTIFIED BY THE SECRETARY OF COMMUNITY
4 AFFAIRS UNDER 16 PA.CODE CH. 23 (RELATING TO ENTERPRISE
5 DEVELOPMENT AREA INITIATIVE), OR WITHIN COMMUNITIES WHICH
6 HAVE BEEN DESIGNATED AS FEDERAL DISASTER RELIEF AREAS, FOR
7 THE ENTIRE PERIOD OF SUCH FEDERAL DESIGNATION, PROVIDED THAT
8 SUCH PROJECTS ARE REASONABLY RELATED TO THE REPLACEMENT,
9 RECONSTRUCTION OR REHABILITATION OF FACILITIES OR EQUIPMENT
10 DESTROYED OR DAMAGED BY NATURAL DISASTER. THE SECRETARY SHALL
11 CONSIDER THE ECONOMIC DISTRESS OF THE AREA WHEN DECIDING ON A
12 WAIVER.
13 (B) PROJECTS SET ASIDE BY SECRETARY.--TO FUND PROJECTS THAT
14 DO NOT USE COUNTY ALLOCATIONS AND TO FUND PROJECTS UNDER SECTION
15 5(A)(2)(II) AND (III), (B)(1)(II), AND (C), THE SECRETARY SHALL
16 USE THE FOLLOWING CRITERIA:
17 (1) SIZE OF THE PROJECT, PARTICULARLY AS IT COMPARES TO
18 THE INDIVIDUAL COUNTY'S ALLOCATION.
19 (2) NUMBER OF NET NEW JOBS CREATED.
20 (3) ECONOMIC DISTRESS OF THE AREA, DETERMINED BY ITS
21 UNEMPLOYMENT RATE AND ITS MEDIAN INCOME.
22 (4) AMOUNT OF PRIVATE FUNDS LEVERAGED BY THE TAX-EXEMPT
23 BOND FUNDING.
24 (5) COORDINATION WITH ECONOMIC DEVELOPMENT PLANS OF THE
25 COMMONWEALTH AND OF MUNICIPALITIES AND REGIONS.
26 SECTION 5. ALLOCATION.
27 (A) INITIAL ALLOCATION.--BY DECEMBER 1 OF EACH YEAR, THE
28 SECRETARY SHALL ALLOCATE THE TAX-EXEMPT BOND AUTHORITY FOR THE
29 FOLLOWING CALENDAR YEAR ACCORDING TO THE FOLLOWING:
30 (1) SEVENTY PERCENT TWO-THIRDS SHALL BE ALLOCATED FOR <--
19850S1204B1705 - 16 -
1 USE INSIDE THE BORDERS OF EACH COUNTY IN THIS COMMONWEALTH.
2 IF THE LOCAL AUTHORITY RESIDES OUTSIDE OF THE COUNTY WHICH
3 CONTAINS THE PROJECT SITE, NO PROJECT SHALL BE APPROVED
4 WITHOUT WRITTEN APPROVAL OF THE HIGHEST ELECTED OFFICIALS IN
5 THAT COUNTY. THE FOLLOWING IS THE ALLOCATION FORMULA:
6 (I) THE SECRETARY SHALL DETERMINE THE RATIO OF TAX- <--
7 EXEMPT BOND USAGE OF THE COUNTY TO THE TAX-EXEMPT BOND
8 USAGE OF ALL COUNTIES FOR THE TWO MOST RECENTLY COMPLETED
9 CALENDAR YEARS, EXCLUDING PROJECTS FOR WHICH THE TAX-
10 EXEMPT FINANCING EXCEEDS $5,000,000.
11 (II) THE SECRETARY SHALL DETERMINE THE RATIO OF THE
12 AVERAGE NUMBER OF UNEMPLOYED INDIVIDUALS IN THE COUNTY TO
13 THE AVERAGE NUMBER OF UNEMPLOYED INDIVIDUALS IN ALL
14 COUNTIES FOR THE MOST RECENT 12 MONTHS FOR WHICH REVISED
15 UNEMPLOYMENT STATISTICS ARE AVAILABLE.
16 (III) THE SECRETARY SHALL MULTIPLY THE RATIO
17 DETERMINED IN SUBPARAGRAPH (II) BY TWO.
18 (IV) THE SECRETARY SHALL ADD THE RATIO DETERMINED IN
19 SUBPARAGRAPH (I) TO THE PRODUCT DETERMINED IN
20 SUBPARAGRAPH (III).
21 (V) THE SECRETARY SHALL DIVIDE THE SUM DETERMINED IN
22 SUBPARAGRAPH (IV) BY THREE.
23 (VI) THE SECRETARY SHALL MULTIPLY THE QUOTIENT
24 DETERMINED IN SUBPARAGRAPH (V) BY THE TOTAL AMOUNT
25 AVAILABLE TO BE ALLOCATED UNDER THIS PARAGRAPH.
26 (I) THE SECRETARY SHALL DETERMINE THE RATIO OF THE <--
27 COUNTY'S 1985 ALLOCATION TO THE SUM OF EVERY COUNTY'S
28 1985 ALLOCATION, AS CONTAINED IN THE PROCLAMATION
29 ESTABLISHING A FORMULA FOR THE ALLOCATION OF PRIVATE
30 ACTIVITY BONDS SUBJECT TO THE STATE CEILING IN ACCORDANCE
19850S1204B1705 - 17 -
1 WITH THE DEFICIT REDUCTION ACT OF 1984, AS SIGNED BY THE
2 GOVERNOR ON JANUARY 4, 1985.
3 (II) THE SECRETARY SHALL MULTIPLY THE RATIO
4 DETERMINED IN SUBPARAGRAPH (I) BY THE TOTAL AMOUNT
5 AVAILABLE TO BE ALLOCATED UNDER THIS PARAGRAPH.
6 (2) THIRTY PERCENT ONE-THIRD SHALL BE SET ASIDE BY THE <--
7 SECRETARY FOR THE FOLLOWING PURPOSES:
8 (I) USE BY COMMONWEALTH AGENCIES, EXCEPT FOR THE
9 PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY, WHICH
10 REQUIRE THE USE OF TAX-EXEMPT BONDS.
11 (II) PROJECTS WHICH REQUIRE MORE THAN $5,000,000 IN <--
12 BOND AUTHORITY THAN THE COUNTY HAS CURRENTLY AVAILABLE TO <--
13 IT, AND WHICH ARE DETERMINED BY THE SECRETARY TO BE
14 EXCEPTIONAL IN FURTHERING THE PURPOSES OF THIS ACT.
15 (III) EXEMPT FACILITIES PROJECTS.
16 (IV) USE BY THE PENNSYLVANIA HIGHER EDUCATION
17 ASSISTANCE AGENCY. THE AGENCY SHALL, ON OR BEFORE
18 FEBRUARY 1 OF EACH YEAR, PROVIDE THE SECRETARY WITH A
19 REPORT JUSTIFYING REQUESTS FOR BOND AUTHORITY IN THAT
20 YEAR. NOTWITHSTANDING SECTION 4(3) OF THE ACT OF AUGUST
21 7, 1963 (P.L.549, NO.290), REFERRED TO AS THE
22 PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY ACT, THE
23 SECRETARY HAS THE SOLE AUTHORITY TO DETERMINE THE AMOUNT
24 OF THE REQUEST WHICH MAY ACTUALLY BE USED BY THE AGENCY.
25 AN ALLOTMENT OF AT LEAST 25% OF THE ALLOCATION STATED IN <--
26 THIS SUBSECTION SHALL BE RESERVED FOR SOLID WASTE
27 DISPOSAL PROJECTS.
28 (B) REALLOCATION.--
29 (1) ON JULY 1 AUGUST 1 OF EACH YEAR, THE SECRETARY SHALL <--
30 ALLOCATE UNUSED TAX-EXEMPT BOND AUTHORITY AS FOLLOWS:
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1 (I) EIGHTY PERCENT SHALL BE ALLOCATED ON THE BASIS <--
2 OF THE FOLLOWING FORMULA:
3 (A) THE SECRETARY SHALL DETERMINE THE RATIO OF
4 TAX-EXEMPT BOND USAGE OF THE COUNTY TO THE TAX-EXEMPT
5 BOND USAGE OF ALL COUNTIES FOR THE TWO MOST RECENTLY
6 COMPLETED CALENDAR YEARS, EXCLUDING PROJECTS FOR
7 WHICH THE TAX-EXEMPT FINANCING EXCEEDS $5,000,000.
8 (B) THE SECRETARY SHALL MULTIPLY THE RATIO
9 DETERMINED IN CLAUSE (A) BY THE TOTAL AMOUNT
10 AVAILABLE TO BE ALLOCATED UNDER THIS SUBPARAGRAPH.
11 (I) FIFTY PERCENT SHALL BE ALLOCATED FOR USE BY THE <--
12 COUNTIES. THE SECRETARY SHALL GIVE ALLOCATIONS TO THOSE
13 LOCAL PROJECTS WHICH BEST FURTHER THE PURPOSES OF THIS
14 ACT.
15 (II) TWENTY PERCENT FIFTY PERCENT SHALL BE RETAINED <--
16 BY THE SECRETARY FOR A CONTINGENCY RESERVE, WHICH THE
17 SECRETARY MAY USE FOR PROJECTS UNDER SUBSECTION (A)(2).
18 REQUESTS SUBMITTED UNDER SUBSECTION (A)(2)(IV) AFTER
19 FEBRUARY 1 OF EACH YEAR AND UNFUNDED REQUESTS UNDER
20 SUBSECTION (A)(2)(IV) SHALL MAY BE FUNDED THROUGH THE <--
21 CONTINGENCY RESERVE, IN ADDITION TO BEING FUNDED UNDER
22 SUBSECTION (C).
23 (2) AS USED IN THIS SUBSECTION THE TERM "UNUSED TAX-
24 EXEMPT BOND AUTHORITY" MEANS THE TOTAL TAX-EXEMPT BOND
25 ALLOCATION FOR THE COMMONWEALTH, MINUS THE AMOUNT ALLOCATED
26 TO APPROVED PROJECTS UNDER SUBSECTION (A).
27 (C) FINAL ALLOCATION.--ON NOVEMBER 1 OF EACH YEAR, THE
28 SECRETARY SHALL ALLOCATE UNUSED BOND AUTHORITY AT THE DISCRETION
29 OF THE SECRETARY. PROJECTS SHALL BE EVALUATED ACCORDING TO THE
30 PURPOSES SET FORTH IN SECTION 2, AND THE FAILURE TO COMPLY WITH
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1 DEADLINES ESTABLISHED IN THIS SECTION SHALL NOT RENDER AN
2 APPLICANT INELIGIBLE FOR FUNDS IN THE FINAL ALLOCATION PROCESS.
3 REQUESTS SUBMITTED UNDER SUBSECTION (A)(2)(IV) AFTER FEBRUARY 1
4 OF EACH YEAR AND UNFUNDED REQUESTS UNDER SUBSECTION (A)(2)(IV)
5 SHALL MAY BE FUNDED UNDER THIS SUBSECTION, IN ADDITION TO BEING <--
6 FUNDED UNDER SUBSECTION (B)(1)(II).
7 SECTION 6. FEDERAL LAW CHANGE.
8 IN THE EVENT THAT FEDERAL LAW REGULATING TAX-EXEMPT BONDS IS
9 CHANGED, AND THAT SUCH CHANGE WOULD, IN THE OPINION OF THE
10 SECRETARY, CONFLICT WITH THIS ACT IN SUCH A WAY AS TO IMPAIR THE
11 ABILITY OF THE COMMONWEALTH TO USE TAX-EXEMPT BONDS TO THEIR
12 MAXIMUM BENEFIT, THE SECRETARY SHALL HAVE THE POWER TO
13 PROMULGATE REGULATIONS WHICH BECOME EFFECTIVE WHEN THE FEDERAL
14 LAW TAKES EFFECT AND WHICH SHALL ENABLE THE COMMONWEALTH TO
15 UTILIZE TAX-EXEMPT BONDS TO THEIR MAXIMUM BENEFIT, AND WHICH
16 SHALL, TO THE LARGEST EXTENT POSSIBLE, CARRY OUT THE PURPOSES
17 SET FORTH IN THIS ACT.
18 SECTION 7. POWERS AND DUTIES OF SECRETARY.
19 THE SECRETARY HAS THE FOLLOWING POWERS AND DUTIES:
20 (1) DISTRIBUTE TO LOCAL AUTHORITIES MODEL GUIDELINES FOR
21 THE LOCAL AUTHORITIES TO USE IN CARRYING OUT THE PRIORITIES
22 AND OTHER PROVISIONS OF THIS ACT.
23 (2) NOTIFY AFFECTED COMMONWEALTH AGENCIES AND
24 AUTHORITIES OF THEIR BOND ALLOCATIONS WITHIN 15 DAYS OF
25 DEADLINES UNDER SECTION 5. THE NOTICE UNDER THIS PARAGRAPH
26 SHALL INCLUDE A JUSTIFICATION OF THE ALLOCATION AND THE
27 NUMBERS USED IN THE FORMULA APPLICABLE TO THE ALLOCATION OF
28 THE AGENCY OR AUTHORITY.
29 (3) SUBMIT REPORTS TO THE CHIEF CLERK OF THE HOUSE OF
30 REPRESENTATIVES AND THE SECRETARY OF THE SENATE WITHIN 45
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1 DAYS OF JANUARY 1 AND WITHIN 45 DAYS OF JULY 1 OF EACH YEAR.
2 REPORTS SHALL INCLUDE:
3 (I) A LIST OF PROJECTS APPROVED, DISAPPROVED AND
4 PENDING. THE LIST SHALL CONTAIN, FOR EACH REQUEST:
5 (A) AMOUNT.
6 (B) LOCATION.
7 (C) ESTIMATED JOBS.
8 (D) ISSUING AUTHORITY OR COMMONWEALTH AGENCY.
9 (E) SECTION OF THIS ACT UNDER WHICH BOND
10 AUTHORITY WAS GIVEN.
11 (II) THE MOST RECENT REPORT SUBMITTED TO THE
12 SECRETARY BY THE PENNSYLVANIA HIGHER EDUCATION ASSISTANCE
13 AGENCY UNDER SECTION 5(A)(2)(IV), THE REASONS FOR
14 APPROVAL OR DISAPPROVAL OF THE REQUEST AND A CASH FLOW
15 PROJECTION OF ALL BONDS ISSUED BY THE AGENCY.
16 (III) THE MODEL GUIDELINES UNDER PARAGRAPH (1).
17 (IV) OTHER INFORMATION WHICH THE SECRETARY DEEMS
18 PERTINENT, INCLUDING SUGGESTED CHANGES TO THE PROGRAM.
19 (4) PROMULGATE REGULATIONS TO CARRY OUT THE PURPOSES SET <--
20 FORTH IN SECTION 2.
21 (4) PROMULGATE ANY REGULATIONS AS MAY BE NECESSARY TO <--
22 CARRY OUT THE PURPOSES SET FORTH IN THIS ACT AND PUBLISH AS
23 STATEMENTS OF POLICY THE COUNTY-BY-COUNTY ALLOCATIONS
24 PROVIDED BY SECTION 5(A)(1) AND PUBLISH ALL OTHER GENERAL
25 PROCEDURES, REQUIREMENTS, INTERPRETATIONS AND GUIDELINES AND
26 CHANGES THERETO UTILIZED IN THE IMPLEMENTATION OF THIS ACT.
27 SECTION 8. PRIOR PROJECT APPROVALS.
28 ALL PROJECTS APPROVED IN 1985, BUT FOR WHICH PRELIMINARY
29 ALLOCATION REQUESTS WERE NOT GRANTED, MAY FILE THEIR PRELIMINARY
30 ALLOCATION REQUEST IN 1986 SUBJECT TO THE PROCLAMATION
19850S1204B1705 - 21 -
1 ESTABLISHING A FORMULA FOR THE ALLOCATION OF PRIVATE ACTIVITY
2 BONDS SUBJECT TO THE STATE CEILING IN ACCORDANCE WITH THE
3 DEFICIT REDUCTION ACT OF 1984, AS SIGNED BY THE GOVERNOR ON
4 JANUARY 4, 1985, AND THE COUNTY'S 1986 ALLOCATION LIMITS.
5 SECTION 8 9. EFFECTIVE DATE. <--
6 (A) INITIAL ALLOCATION.--SECTION 5(A) SHALL TAKE EFFECT
7 NOVEMBER 30, 1985, OR IMMEDIATELY, WHICHEVER IS LATER.
8 (B) NOTICE.--SECTION 7(2) SHALL TAKE EFFECT DECEMBER 1,
9 1985, OR IMMEDIATELY, WHICHEVER IS LATER.
10 (C) REMAINDER.--THE REMAINDER OF THIS ACT SHALL TAKE EFFECT
11 JANUARY 1, 1986, OR IMMEDIATELY, WHICHEVER IS LATER.
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