Pennsylvania Act 1986-202 — NEW HOME CONSTRUCTION LOCAL TAX ABATEMENT ACT

Act text

NEW HOME CONSTRUCTION LOCAL TAX ABATEMENT ACT
                 Act of Dec. 17, 1986, P.L. 1693, No. 202             Cl. 53
                                  AN ACT

     Empowering certain local taxing authorities to provide
        exemptions from taxation for certain improvements made to
        certain unimproved residential property.

        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 New Home
     Construction Local Tax Abatement Act.
     Section 2.  Construction.
        This act shall be construed to authorize local taxing
     authorities to exempt improvement to certain unimproved
     residential property implementing section 2(b)(iv) of Article
     VIII of the Constitution of Pennsylvania.
     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:
        "Improvement."  The erection or construction of one or more
     residential buildings in compliance with laws, ordinances or
     regulations governing such actions.
        "Local taxing authority."  A county, city, borough,
     incorporated town, township, school district or home rule
     municipality having authority to levy real property taxes.
        "Unimproved residential property."  Any unimproved real
     estate owned by an individual, association, corporation or
     governmental entity located in this Commonwealth, which is or
     may be zoned, in accordance with the provisions of the act of
     July 31, 1968 (P.L.805, No.247), known as the Pennsylvania
     Municipalities Planning Code, for residential use.
     Section 4.  New residential construction.
        (a)  Power to grant exemptions.--Each local taxing authority
     may, by ordinance or resolution, exempt from real property
     taxation the assessed valuation of improvements to unimproved
     residential property in the amounts and in accordance with the
     provisions and limitations set forth in this act. Prior to the
     adoption of the ordinance or resolution authorizing the granting
     of tax exemptions, the local taxing authority by ordinance or
     resolution shall affix the boundaries of the unimproved
     residential property or properties wholly or partially located
     within its jurisdiction for which the tax exemption shall be
     available. Such ordinance or resolution shall also specify the
     purpose for determining such boundaries, including, but not
     limited to, maintenance of neighborhoods, consistency of zoning
     districts, rejuvenation of blighted areas and development of
     vacant property. Prior to the adoption of the ordinance or
     resolution authorizing the granting of tax exemptions, the local
     taxing authority shall conduct at least one public hearing for
     the purpose of discussion of the provisions of the ordinance,
     including, but not limited to, the abatement period and the
     exemption schedule. At the public hearing, local taxing
     authorities, planning commissioners, redevelopment authorities,
     and other public and private agencies, individuals, associations
     and corporations which are knowledgeable and interested in the
     improvement of unimproved residential property may present their
     recommendations concerning the location of boundaries of the
     unimproved residential property or properties for the guidance
     of the local taxing authority. The ordinance or resolution
     adopted by a local taxing authority shall specify the cost of
     improvements per dwelling unit to be exempted, and the schedule
     of taxes exempted.
        (b)  Cooperation between municipalities.--Two or more local
     taxing authorities may join together for the purpose of
     implementing this act. The local taxing authorities may, by
     implementing ordinance or resolution, agree to adopt tax
     exemptions contingent upon the similar adoption by an adjacent
     local taxing authority or by a local taxing authority with
     mutual jurisdiction, within the limitations provided herein.
        (c)  Limitation.--In the event a local taxing authority
     enacts an ordinance under subsection (a) and subsequently amends
     the ordinance to shorten the abatement period provided for in
     the original or latest version of the ordinance, the taxing
     authority shall not reduce the abatement period for those
     property owners eligible for and participating in the previously
     enacted abatement program. In the event a local taxing authority
     enacts an abatement ordinance under subsection (a) and
     subsequently amends the ordinance to extend the abatement period
     provided for in the original or latest version of the ordinance,
     the taxing authority may extend the abatement period for those
     property owners eligible for and participating in the previously
     enacted abatement program provided, however, that in no case
     shall the original period plus the extension result in an
     abatement period that exceeds two years.
     Section 5.  Exemption schedule.
        (a)  Amount of exemption.--A local taxing authority granting
     a tax exemption pursuant to this act may provide for tax
     exemption on the assessment attributable to the actual cost of
     improvements or up to any maximum cost uniformly established by
     the local taxing authority. The maximum cost shall apply
     uniformly to all eligible unimproved residential property within
     the local taxing authority jurisdiction.
        (b)  Schedule of taxes.--Whether or not the assessment
     eligible for exemption is based upon actual cost or a maximum
     cost, the actual amount of taxes exempted shall be in accordance
     with the schedule of taxes exempted established by the local
     taxing authority, subject to the following limitations:
            (1)  The length of the schedule of taxes exempted which
        shall be known as the abatement period shall not exceed two
        years.
            (2)  The schedule of taxes exempted shall stipulate the
        portion of improvements to be exempted each year.
            (3)  The exemption from taxes shall be limited to the
        additional assessment valuation attributable to the actual
        cost of improvements to the property or not in excess of the
        maximum cost per unit established by the local taxing
        authority.
     Section 6.  Procedure for obtaining an exemption.
        (a)  Notification.--Any person desiring tax exemption,
     pursuant to ordinances or resolutions adopted pursuant to this
     act, shall notify each local taxing authority granting the
     exemption on a form provided by the local taxing authority. The
     form shall be submitted between the time the person desiring tax
     exemption secures the building permit and when the occupancy
     permit is issued, or if no building permit or other notification
     of improvement is required, prior to the time the structure is
     assessed for tax purposes. A copy of the exemption request shall
     be forwarded to the Board of Assessment and Revision of Taxes or
     other appropriate assessment agency. The assessment agency shall
     not be required to reassess that portion of the property which
     has been exempted by the municipality for taxation purposes
     until the exemption period has expired. Appeals from any
     reassessment and the amounts eligible for the exemption may be
     taken by the taxpayer or the local taxing authorities as
     provided by law. ((a) amended Dec. 19, 1997, P.L.617, No.63)
        (b)  Application of changes.--Except as may be authorized in
     section 4(c), the cost of improvements to be exempted and the
     schedule of taxes exempted existing at the time of the
     submission of the form as provided in subsection (a) shall be
     applicable to that exemption request.
     Section 7.  Effective date.
        This act shall take effect immediately.