Regular Session 2023-2024 House Bill 1219 P.N. 2089

CORRECTIVE REPRINT

PRIOR PRINTER'S NOS. 1310, 1694, 2076,

2088

PRINTER'S NO. 2089

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

1219

Session of

2023

INTRODUCED BY BRIGGS, FREEMAN, MADDEN, SCHLOSSBERG, SANCHEZ,

HILL-EVANS, GUENST, HANBIDGE, WEBSTER, NEILSON, SCOTT, GREEN,

PIELLI AND TAKAC, MAY 24, 2023

AS RE-REPORTED FROM COMMITTEE ON APPROPRIATIONS, HOUSE OF

REPRESENTATIVES, AS AMENDED, OCTOBER 3, 2023

AN ACT

Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An

act relating to tax reform and State taxation by codifying

and enumerating certain subjects of taxation and imposing

taxes thereon; providing procedures for the payment,

collection, administration and enforcement thereof; providing

for tax credits in certain cases; conferring powers and

imposing duties upon the Department of Revenue, certain

employers, fiduciaries, individuals, persons, corporations

and other entities; prescribing crimes, offenses and

penalties," in corporate net income tax, further providing

for definitions, for imposition of tax and for manufacturing

innovation and reinvestment deduction.

AMENDING THE ACT OF MARCH 4, 1971 (P.L.6, NO.2), ENTITLED "AN

ACT RELATING TO TAX REFORM AND STATE TAXATION BY CODIFYING

AND ENUMERATING CERTAIN SUBJECTS OF TAXATION AND IMPOSING

TAXES THEREON; PROVIDING PROCEDURES FOR THE PAYMENT,

COLLECTION, ADMINISTRATION AND ENFORCEMENT THEREOF; PROVIDING

FOR TAX CREDITS IN CERTAIN CASES; CONFERRING POWERS AND

IMPOSING DUTIES UPON THE DEPARTMENT OF REVENUE, CERTAIN

EMPLOYERS, FIDUCIARIES, INDIVIDUALS, PERSONS, CORPORATIONS

AND OTHER ENTITIES; PRESCRIBING CRIMES, OFFENSES AND

PENALTIES," IN PERSONAL INCOME TAX, FURTHER PROVIDING FOR

CLASSES OF INCOME AND FOR SPECIAL TAX PROVISIONS FOR POVERTY

AND PROVIDING FOR ALTERNATIVE SPECIAL TAX PROVISIONS FOR

POVERTY; IN CORPORATE NET INCOME TAX, FURTHER PROVIDING FOR

DEFINITIONS, FOR IMPOSITION OF TAX, FOR REPORTS AND PAYMENT

OF TAX, FOR CONSOLIDATED REPORTS AND FOR MANUFACTURING

<--

INNOVATION AND REINVESTMENT DEDUCTION; IN REALTY TRANSFER

TAX, FURTHER PROVIDING FOR TRANSFER OF TAX; IN TAX CREDIT AND

TAX BENEFIT ADMINISTRATION, FURTHER PROVIDING FOR

DEFINITIONS; IN ENTERTAINMENT PRODUCTION TAX CREDIT, FURTHER

PROVIDING FOR DEFINITIONS, FOR CREDIT FOR QUALIFIED FILM

PRODUCTION EXPENSES, FOR CARRYOVER, CARRYBACK AND ASSIGNMENT

OF CREDIT AND FOR LIMITATIONS; IN PENNSYLVANIA ECONOMIC

DEVELOPMENT FOR A GROWING ECONOMY (PA EDGE) TAX CREDITS,

PROVIDING FOR BIOTECHNOLOGY; IN NEIGHBORHOOD ASSISTANCE TAX

CREDIT, FURTHER PROVIDING FOR TAX CREDIT AND FOR GRANT OF TAX

CREDIT; PROVIDING FOR EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONES; IN PENNSYLVANIA CHILD AND DEPENDENT CARE ENHANCEMENT

TAX CREDIT PROGRAM, FURTHER PROVIDING FOR CREDIT FOR CHILD

AND DEPENDENT CARE EMPLOYMENT-RELATED EXPENSES; PROVIDING FOR

PUBLIC TRANSPORTATION TRUST FUND; AND, IN GENERAL PROVISIONS,

FURTHER PROVIDING FOR UNDERPAYMENT OF ESTIMATED TAX, FOR

METHOD OF FILING AND FOR ALLOCATION OF TAX CREDITS.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Section 401(3)4(c)(1) and (2) of the act of March

4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, are

amended to read:

Section 401. Definitions.--The following words, terms, and

phrases, when used in this article, shall have the meaning

ascribed to them in this section, except where the context

clearly indicates a different meaning:

* * *

(3) "Taxable income." * * *

4. * * *

(A) (I) For taxable years beginning before January 1, 2007,

two million dollars ($2,000,000);

(II) For taxable years beginning after December 31, 2006,

the greater of twelve and one-half per cent of taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

three million dollars ($3,000,000);

(III) For taxable years beginning after December 31, 2008,

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the greater of fifteen per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or three

million dollars ($3,000,000);

(IV) For taxable years beginning after December 31, 2009,

the greater of twenty per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or three

million dollars ($3,000,000);

(V) For taxable years beginning after December 31, 2013, the

greater of twenty-five per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or four million

dollars ($4,000,000);

(VI) For taxable years beginning after December 31, 2014,

the greater of thirty per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 or five million

dollars ($5,000,000);

(VII) For taxable years beginning after December 31, 2017,

thirty-five per cent of taxable income as determined under

subclause 1 or, if applicable, subclause 2;

(VIII) For taxable years beginning after December 31, 2018,

forty per cent of taxable income as determined under subclause 1

or, if applicable, subclause 2; [or]

(IX) For taxable years beginning after December 31, 2023,

fifty per cent of taxable income as determined under subclause 1

or, if applicable, subclause 2;

(X) For taxable years beginning after December 31, 2024,

sixty per cent of taxable income as determined under subclause 1

or, if applicable, subclause 2;

(XI) For taxable years beginning after December 31, 2025,

seventy per cent of taxable income as determined under subclause

1 or, if applicable, subclause 2; or

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(XII) For taxable years beginning after December 31, 2026,

eighty per cent of taxable income as determined under subclause

1 or, if applicable, subclause 2; or

(B) The amount of the net loss or losses which may be

carried over to the taxable year or taxable income as determined

under subclause 1 or, if applicable, subclause 2.

* * *

(2) (A) A net loss for a taxable year may only be carried

over pursuant to the following schedule:

Taxable Year Carryover

1981 1 taxable year

1982 2 taxable years

1983-1987 3 taxable years

1988 2 taxable years plus

1 taxable year

starting with the

1995 taxable year

1989 1 taxable year plus

2 taxable years

starting with the

1995 taxable year

1990-1993 3 taxable years

starting with the

1995 taxable year

1994 1 taxable year

1995-1997 10 taxable years

1998 and thereafter 20 taxable years

(B) The earliest net loss shall be carried over to the

earliest taxable year to which it may be carried under this

schedule. The total net loss deduction allowed in any taxable

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year shall not exceed:

(I) Two million dollars ($2,000,000) for taxable years

beginning before January 1, 2007.

(II) The greater of twelve and one-half per cent of the

taxable income as determined under subclause 1 or, if

applicable, subclause 2 or three million dollars ($3,000,000)

for taxable years beginning after December 31, 2006.

(III) The greater of fifteen per cent of the taxable income

as determined under subclause 1 or, if applicable, subclause 2

or three million dollars ($3,000,000) for taxable years

beginning after December 31, 2008.

(IV) The greater of twenty per cent of the taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

three million dollars ($3,000,000) for taxable years beginning

after December 31, 2009.

(V) The greater of twenty-five per cent of taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

four million dollars ($4,000,000) for taxable years beginning

after December 31, 2013.

(VI) The greater of thirty per cent of taxable income as

determined under subclause 1 or, if applicable, subclause 2 or

five million dollars ($5,000,000) for taxable years beginning

after December 31, 2014.

(VII) Thirty-five per cent of taxable income as determined

under subclause 1 or, if applicable, subclause 2 for taxable

years beginning after December 31, 2017.

(VIII) Forty per cent of taxable income as determined under

subclause 1 or, if applicable, subclause 2 for taxable years

beginning after December 31, 2018.

(IX) Fifty per cent of taxable income as determined under

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subclause 1 or, if applicable, subclause 2 for taxable years

beginning after December 31, 2023.

(X) Sixty per cent of taxable income as determined under

subclause 1 or, if applicable, subclause 2 for taxable years

beginning after December 31, 2024.

(XI) Seventy per cent of taxable income as determined under

subclause 1 or, if applicable, subclause 2 for taxable years

beginning after December 31, 2025.

(XII) Eighty per cent of taxable income as determined under

subclause 1 or, if applicable, subclause 2 for taxable years

beginning after December 31, 2026.

* * *

Section 2. Section 402(b) of the act, amended July 8, 2022

(P.L.513, No.53), is amended to read:

Section 402. Imposition of Tax.--* * *

(b) The annual rate of tax on corporate net income imposed

by subsection (a) for taxable years beginning for the calendar

year or fiscal year on or after the dates set forth shall be as

follows:

Taxable Year Tax Rate

January 1, 1995,

through December

31, 2022 9.99%

January 1, 2023,

through December

31, 2023 [8.99%] 7.99%

January 1, 2024,

through December

31, 2024 [8.49%] 6.99%

January 1, 2025,

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through December

31, 2025 [7.99%] 5.99%

January 1, 2026,

[through December

31, 2026] and each

taxable year

thereafter

[7.49%] 4.99%

[January 1, 2027,

through December

31, 2027 6.99%

January 1, 2028,

through December

31, 2028 6.49%

January 1, 2029,

through December

31, 2029 5.99%

January 1, 2030,

through December

31, 2030 5.49%

January 1, 2031, and

each taxable year

thereafter 4.99%]

* * *

Section 3. Section 407.7 of the act is amended to read:

Section 407.7. Manufacturing Innovation and Reinvestment

Deduction.--(a) In order to be eligible to receive a

manufacturing innovation and reinvestment deduction, a taxpayer

must demonstrate to the department a private capital investment

in excess of [sixty million dollars ($60,000,000)] fifty million

dollars ($50,000,000) for the creation of new or refurbished

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manufacturing capacity within [three years of a designated start

date] the applicable time period specified in subsection (b).

(b) (1) A taxpayer must advise the department in advance of

the start date of any project for which the taxpayer may seek a

qualified manufacturing innovation and reinvestment deduction. A

taxpayer must attest the taxpayer's intent to meet the

eligibility criteria and provide relevant information pertinent

to the project's size and scope in a manner as determined by the

department.

(2) For a private capital investment of less than or equal

to one hundred fifty million dollars ($150,000,000), the

following shall apply:

(i) The project must be completed within three years of the

project's start date.

(ii) Within five years of [a] the project's start date, [a]

the taxpayer must complete to the department's satisfaction an

application on a form and in a manner as determined by the

department to attest that the project has been completed and the

eligibility criteria has been satisfied.

(3) For a private capital investment greater than one

hundred fifty million one dollars ($150,000,001) and less than

two hundred fifty million dollars ($250,000,000), the following

shall apply:

(i) The project must be completed within five years of the

project's start date.

(ii) Within seven years of the project's start date, the

taxpayer must complete to the department's satisfaction an

application on a form and in a manner as determined by the

department to attest that the project has been completed and the

eligibility criteria has been satisfied.

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(4) For a private capital investment greater than two

hundred fifty million one dollars ($250,000,001) and less than

three hundred fifty million dollars ($350,000,000), the

following shall apply:

(i) The project must be completed within seven years of the

project's start date.

(ii) Within nine years of the project's start date, the

taxpayer must complete to the department's satisfaction an

application on a form and in a manner as determined by the

department to attest that the project has been completed and the

eligibility criteria has been satisfied.

(5) For a private capital investment greater than three

hundred fifty million one dollars ($350,000,001) , the department

shall establish the time period from the project's start date in

which the project must be completed and the time period in which

the application as described in paragraph (4) must be completed.

Department of Revenue [must] shall make a finding [that] whether

the applicant has filed all required State tax reports and

returns for all applicable tax years and paid any balance of

State tax due as determined at settlement, assessment or

determination, and the department, then in conjunction with the

Department of Revenue, shall make an eligibility or satisfaction

determination within ninety days of submission. If the

department makes a satisfaction determination, the department

and the taxpayer shall execute a satisfaction commitment letter

containing the following:

(1) The number of new jobs created and their corresponding

description.

(2) The number of new jobs created during construction of

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the project.

(3) The amount of private capital investment in the creation

of new jobs.

(4) The increase in the annual taxable payroll attributable

to new manufacturing jobs.

(5) A determination of the maximum allowable deduction

against a taxpayer's qualified tax liability under this article.

(6) Any other information as the department deems

appropriate.

(d)

(1.1) If the private capital investment is in excess of

sixty million dollars ($60,000,000), but not more than one

hundred million dollars ($100,000,000), the maximum allowable

deduction shall be equal to thirty-seven and one-half per cent

of the private capital investment utilized in the creation of

new or refurbished manufacturing capacity. A taxpayer may

utilize the deduction in an amount not to exceed seven and one-

half per cent of the private capital investment utilized in the

creation of new or refurbished manufacturing capacity in any one

year of the succeeding ten tax years immediately following the

department's satisfaction determination and the execution of a

satisfaction commitment letter, up to the maximum allowable

deduction. This paragraph shall only apply to applications made

prior to January 1, 2024.

(1.2) If [the] a taxpayer's private capital investment for a

project exceeds [one hundred million dollars ($100,000,000)]

fifty million dollars ($50,000,000), the maximum allowable

deduction shall be equal to twenty-five per cent of the private

capital investment utilized in the creation of new or

refurbished manufacturing capacity. A taxpayer may utilize the

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deduction in an amount not to exceed five per cent of the

private capital investment utilized in the creation of new or

refurbished manufacturing capacity in any one year of the

succeeding ten tax years immediately following the department's

satisfaction determination and the execution of a satisfaction

commitment letter, up to the maximum allowable deduction.

(1.3) If a taxpayer executes a satisfaction commitment

letter for more than two concurrent projects with a total

private capital investment exceeding five hundred million

dollars ($500,000,000), the maximum allowable deduction for any

succeeding project shall be equal to twenty-five per cent of the

private capital investment utilized in the creation of new or

refurbished manufacturing capacity. A taxpayer may utilize the

deduction in an amount not to exceed five per cent of the

private capital investment utilized in the creation of new or

refurbished manufacturing capacity in any one year of the

succeeding twenty tax years immediately following the

department's satisfaction determination and the execution of a

satisfaction commitment letter, up to the maximum allowable

deduction.

(3) A taxpayer cannot use the deduction to reduce [its] the

taxpayer's tax liability by more than fifty per cent of the tax

liability under this article for the taxable year. The deduction

is nontransferable and any unused portion in a tax year shall

expire at the end of the corresponding tax year.

Section 4. The amendment of section 407.7 of the act shall

apply to tax years beginning after December 31, 2023.

Section 5. This act shall take effect immediately.

SECTION 1. SECTIONS 303(A.7)(2)(I) AND 304(D) OF THE ACT OF

MARCH 4, 1971 (P.L.6, NO.2), KNOWN AS THE TAX REFORM CODE OF

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1971, ARE AMENDED BY ADDING CLAUSES TO READ:

SECTION 303. CLASSES OF INCOME.--* * *

(A.7) THE FOLLOWING APPLY:

* * *

(2) (I) THE FOLLOWING SHALL NOT BE SUBJECT TO TAX UNDER

THIS ARTICLE:

* * *

(E) AMOUNTS PAID OR INCURRED BY AN EMPLOYER OF AN EMPLOYE

FOR DEPENDENT CARE ASSISTANCE PROVIDED TO THE EMPLOYE THAT ARE

EXCLUDABLE UNDER SECTION 129 OF THE INTERNAL REVENUE CODE OF

1986, AS AMENDED.

* * *

SECTION 304. SPECIAL TAX PROVISIONS FOR POVERTY.--* * *

(D) ANY CLAIM FOR SPECIAL TAX PROVISIONS HEREUNDER SHALL BE

DETERMINED IN ACCORDANCE WITH THE FOLLOWING:

* * *

(4) THE POVERTY INCOME AMOUNTS UNDER CLAUSE (1) SHALL BE

INCREASED BY AN ANNUAL COST-OF-LIVING ADJUSTMENT CALCULATED BY

APPLYING THE PERCENTAGE CHANGE IN THE CONSUMER PRICE INDEX FOR

ALL URBAN CONSUMERS (CPI-U) FOR THE PENNSYLVANIA, NEW JERSEY,

DELAWARE AND MARYLAND AREA, FOR THE MOST RECENT TWELVE-MONTH

PERIOD FOR WHICH FIGURES HAVE BEEN OFFICIALLY REPORTED BY THE

UNITED STATES DEPARTMENT OF LABOR, BUREAU OF LABOR STATISTICS

IMMEDIATELY PRIOR TO THE DATE THE ADJUSTMENT IS DUE TO TAKE

EFFECT, TO THE THEN CURRENT POVERTY INCOME AMOUNTS. THE

DEPARTMENT SHALL DETERMINE THE PERCENTAGE INCREASE AND THE NEW

POVERTY INCOME AMOUNTS PRIOR TO THE ANNUAL EFFECTIVE DATE OF THE

ADJUSTMENT AND SHALL TRANSMIT NOTICE TO THE LEGISLATIVE

REFERENCE BUREAU FOR PUBLICATION IN THE PENNSYLVANIA BULLETIN

WITHIN TEN DAYS OF THE DATE THE DETERMINATION IS MADE. THE

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POVERTY INCOME AMOUNTS MAY NOT BE DECREASED AS A RESULT OF A

NEGATIVE PERCENTAGE CHANGE IN THE CPI-U FOR THE PENNSYLVANIA,

NEW JERSEY, DELAWARE AND MARYLAND AREA.

SECTION 1.1. THE ACT IS AMENDED BY ADDING A SECTION TO READ:

SECTION 304.3. ALTERNATIVE SPECIAL TAX PROVISIONS FOR

POVERTY.--(A) A CLAIMANT WHO HAS A DEPENDENT SHALL BE ENTITLED

TO A REFUND OR FORGIVENESS OF MONEY THAT HAS BEEN PAID OVER TO,

OR WOULD EXCEPT FOR THE PROVISIONS OF THIS SECTION BE PAYABLE

TO, THE COMMONWEALTH UNDER THE PROVISIONS OF THIS ARTICLE FOR

TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2023, IN THE AMOUNT

BY WHICH TWENTY-FIVE PER CENT OF THE EARNED INCOME CREDIT

ALLOWABLE UNDER 26 U.S.C. § 32 (RELATING TO EARNED INCOME)

EXCEEDS THE TAX IMPOSED UNDER THIS ARTICLE FOR THE TAXABLE YEAR.

(B) A CLAIMANT WHO IS ELIGIBLE FOR THE SPECIAL TAX

PROVISIONS FOR POVERTY UNDER SECTION 304 MAY CLAIM A REFUND OR

FORGIVENESS UNDER SUBSECTION (A) IN LIEU OF UTILIZING THE

SPECIAL TAX PROVISIONS FOR POVERTY.

FEDERAL TAX RETURNS, THE CREDIT AUTHORIZED UNDER SUBSECTION (A)

MAY ONLY BE USED BY THE SPOUSE WITH THE GREATER TAX OTHERWISE

DUE, COMPUTED WITHOUT REGARD TO THE CREDIT.

SECTION 2. SECTION 401(3)1(A), (B) AND (T) AND 4(C)(1) AND

(2) AND (5) OF THE ACT ARE AMENDED, (3)2(A)(9)(A) IS AMENDED BY

ADDING A UNIT, (3)1 AND (3)4 ARE AMENDED BY ADDING PHRASES AND

THE SECTION IS AMENDED BY ADDING CLAUSES TO READ:

SECTION 401. DEFINITIONS.--THE FOLLOWING WORDS, TERMS, AND

PHRASES, WHEN USED IN THIS ARTICLE, SHALL HAVE THE MEANING

ASCRIBED TO THEM IN THIS SECTION, EXCEPT WHERE THE CONTEXT

CLEARLY INDICATES A DIFFERENT MEANING:

* * *

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(3) "TAXABLE INCOME." 1. (A) IN CASE THE ENTIRE BUSINESS

OF THE CORPORATION IS TRANSACTED WITHIN THIS COMMONWEALTH, FOR

ANY TAXABLE YEAR WHICH BEGINS ON OR AFTER JANUARY 1, 1971,

TAXABLE INCOME FOR THE CALENDAR YEAR OR FISCAL YEAR AS RETURNED

TO AND ASCERTAINED BY THE FEDERAL GOVERNMENT BEFORE SPECIAL

DEDUCTIONS PROVIDED FOR IN 26 U.S.C. CH. 1 SUBCH. B PT. VIII

(RELATING TO SPECIAL DEDUCTIONS FOR CORPORATIONS), NOT INCLUDING

THE DEDUCTIONS PROVIDED FOR IN 26 U.S.C. § 243 (RELATING TO

DIVIDENDS RECEIVED BY CORPORATIONS), OR IN THE CASE OF A

CORPORATION PARTICIPATING IN THE FILING OF CONSOLIDATED RETURNS

TO THE FEDERAL GOVERNMENT OR THAT IS NOT REQUIRED TO FILE A

RETURN WITH THE FEDERAL GOVERNMENT, THE TAXABLE INCOME WHICH

WOULD HAVE BEEN RETURNED TO AND ASCERTAINED BY THE FEDERAL

GOVERNMENT BEFORE SPECIAL DEDUCTIONS PROVIDED FOR IN 26 U.S.C.

CH. 1 SUBCH. B PT. VIII, NOT INCLUDING THE DEDUCTIONS PROVIDED

FOR IN 26 U.S.C. § 243, IF SEPARATE RETURNS HAD BEEN MADE TO THE

FEDERAL GOVERNMENT FOR THE CURRENT AND PRIOR TAXABLE YEARS,

SUBJECT, HOWEVER, TO ANY CORRECTION THEREOF, FOR FRAUD, EVASION,

OR ERROR AS FINALLY ASCERTAINED BY THE FEDERAL GOVERNMENT.

(B) ADDITIONAL DEDUCTIONS SHALL BE ALLOWED FROM TAXABLE

INCOME ON ACCOUNT OF ANY DIVIDENDS RECEIVED FROM ANY OTHER

CORPORATION BUT ONLY TO THE EXTENT THAT SUCH DIVIDENDS ARE

INCLUDED IN TAXABLE INCOME AS RETURNED TO AND ASCERTAINED BY THE

FEDERAL GOVERNMENT. FOR TAX YEARS BEGINNING ON OR AFTER JANUARY

1, 1991, ADDITIONAL DEDUCTIONS SHALL ONLY BE ALLOWED FOR AMOUNTS

INCLUDED, UNDER [SECTION 78 OF THE INTERNAL REVENUE CODE OF 1986

(PUBLIC LAW 99-514, 26 U.S.C. § 78)] 26 U.S.C. § 78 (RELATING TO

GROSS UP FOR DEEMED PAID FOREIGN TAX CREDIT), IN TAXABLE INCOME

RETURNED TO AND ASCERTAINED BY THE FEDERAL GOVERNMENT AND FOR

THE AMOUNT OF ANY DIVIDENDS RECEIVED FROM A FOREIGN CORPORATION

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INCLUDED IN TAXABLE INCOME TO THE EXTENT SUCH DIVIDENDS WOULD BE

DEDUCTIBLE IN ARRIVING AT FEDERAL TAXABLE INCOME IF RECEIVED

FROM A DOMESTIC CORPORATION. FOR TAXABLE YEARS BEGINNING AFTER

DECEMBER 31, 2024, THE ADDITIONAL DEDUCTION WITH RESPECT TO

DIVIDENDS SHALL NOT BE ALLOWED FOR DIVIDENDS BETWEEN MEMBERS OF

A UNITARY GROUP.

* * *

(B.2) AN ADDITIONAL DEDUCTION SHALL BE ALLOWED FROM THE

TAXABLE INCOME OF A MEDICAL MARIJUANA ORGANIZATION, AS DEFINED

BY THE ACT OF APRIL 17, 2016 (P.L.84, NO.16), KNOWN AS THE

"MEDICAL MARIJUANA ACT," IN THE AMOUNT OF THE ORDINARY AND

NECESSARY EXPENSES PAID OR INCURRED DURING THE TAXABLE YEAR BY

THE MEDICAL MARIJUANA ORGANIZATION WHICH ARE ORDINARILY

DEDUCTIBLE FOR FEDERAL INCOME TAX PURPOSES UNDER 26 U.S.C. § 162

(RELATING TO TRADE OR BUSINESS EXPENSES). THE ADDITIONAL

DEDUCTION SHALL ONLY BE PERMITTED TO THE EXTENT DEDUCTIONS FOR

EXPENSES UNDER 26 U.S.C. § 162 WERE NOT TAKEN BY THE MEDICAL

MARIJUANA ORGANIZATION FOR FEDERAL INCOME TAX PURPOSES FOR THE

TAXABLE YEAR.

* * *

(P.1) FOR TAXABLE YEARS AFTER DECEMBER 31, 2024, IN THE CASE

OF A CORPORATION THAT IS A MEMBER OF A UNITARY BUSINESS, THE

TERM "TAXABLE INCOME" SHALL MEAN THE COMBINED UNITARY INCOME OF

THE UNITARY BUSINESS, AS DETERMINED ON A WATER'S-EDGE BASIS.

* * *

(T) (1) EXCEPT AS PROVIDED IN PARAGRAPH (2), (3) OR (4) FOR

TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2014, AND IN ADDITION

TO ANY AUTHORITY THE DEPARTMENT HAS ON THE EFFECTIVE DATE OF

THIS PARAGRAPH TO DENY A DEDUCTION RELATED TO A FRAUDULENT OR

SHAM TRANSACTION, NO DEDUCTION SHALL BE ALLOWED FOR AN

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INTANGIBLE EXPENSE OR COST, OR AN INTEREST EXPENSE OR COST,

PAID, ACCRUED OR INCURRED DIRECTLY OR INDIRECTLY IN CONNECTION

WITH ONE OR MORE TRANSACTIONS WITH AN AFFILIATED ENTITY. IN

CALCULATING TAXABLE INCOME UNDER THIS PARAGRAPH, WHEN THE

TAXPAYER IS ENGAGED IN ONE OR MORE TRANSACTIONS WITH AN

AFFILIATED ENTITY THAT WAS SUBJECT TO TAX IN THIS COMMONWEALTH

OR ANOTHER STATE OR POSSESSION OF THE UNITED STATES ON A TAX

BASE THAT INCLUDED THE INTANGIBLE EXPENSE OR COST, OR THE

INTEREST EXPENSE OR COST, PAID, ACCRUED OR INCURRED BY THE

TAXPAYER, THE TAXPAYER SHALL RECEIVE A CREDIT AGAINST TAX DUE IN

THIS COMMONWEALTH IN AN AMOUNT EQUAL TO THE APPORTIONMENT FACTOR

OF THE TAXPAYER IN THIS COMMONWEALTH MULTIPLIED BY THE GREATER

OF THE FOLLOWING:

(A) THE TAX LIABILITY OF THE AFFILIATED ENTITY WITH RESPECT

TO THE PORTION OF ITS INCOME REPRESENTING THE INTANGIBLE EXPENSE

OR COST, OR THE INTEREST EXPENSE OR COST, PAID, ACCRUED OR

INCURRED BY THE TAXPAYER; OR

(B) THE TAX LIABILITY THAT WOULD HAVE BEEN PAID BY THE

AFFILIATED ENTITY UNDER SUBPARAGRAPH (A) IF THAT TAX LIABILITY

HAD NOT BEEN OFFSET BY A CREDIT.

THE CREDIT ISSUED UNDER THIS PARAGRAPH SHALL NOT EXCEED THE

TAXPAYER'S LIABILITY IN THIS COMMONWEALTH ATTRIBUTABLE TO THE

NET INCOME TAXED AS A RESULT OF THE ADJUSTMENT REQUIRED BY THIS

PARAGRAPH.

(2) THE ADJUSTMENT REQUIRED BY PARAGRAPH (1) SHALL NOT APPLY

TO A TRANSACTION THAT DID NOT HAVE AS [THE] A PRINCIPAL PURPOSE

THE AVOIDANCE OF TAX DUE UNDER THIS ARTICLE AND WAS DONE AT

ARM'S LENGTH RATES AND TERMS.

(3) THE ADJUSTMENT REQUIRED BY PARAGRAPH (1) SHALL NOT APPLY

TO A TRANSACTION BETWEEN A TAXPAYER AND AN AFFILIATED ENTITY

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DOMICILED IN A FOREIGN NATION WHICH HAS IN FORCE A COMPREHENSIVE

INCOME TAX TREATY WITH THE UNITED STATES PROVIDING FOR THE

ALLOCATION OF ALL CATEGORIES OF INCOME SUBJECT TO TAXATION, OR

THE WITHHOLDING OF TAX, ON ROYALTIES, LICENSES, FEES AND

INTEREST FOR THE PREVENTION OF DOUBLE TAXATION OF THE RESPECTIVE

NATIONS' RESIDENTS AND THE SHARING OF INFORMATION.

(4) THE ADJUSTMENT REQUIRED BY PARAGRAPH (1) SHALL NOT APPLY

TO A TRANSACTION WHERE AN AFFILIATED ENTITY DIRECTLY OR

INDIRECTLY PAID, ACCRUED OR INCURRED A PAYMENT TO A PERSON WHO

IS NOT AN AFFILIATED ENTITY, IF THE PAYMENT IS PAID, ACCRUED OR

INCURRED ON THE INTANGIBLE EXPENSE OR COST, OR INTEREST EXPENSE

OR COST, AND IS EQUAL TO OR LESS THAN THE TAXPAYER'S

PROPORTIONAL SHARE OF THE TRANSACTION. THE TAXPAYER'S

PROPORTIONAL SHARE SHALL BE BASED ON RELATIVE SALES, ASSETS,

LIABILITIES OR ANOTHER REASONABLE METHOD.

(5) THE ADJUSTMENT REQUIRED UNDER PARAGRAPH (1) SHALL NOT

APPLY TO A TRANSACTION BETWEEN THE TAXPAYER AND AN AFFILIATED

ENTITY, WHERE THE TAXPAYER AND THE AFFILIATED ENTITY FILE A

COMBINED ANNUAL REPORT IN THIS STATE.

2. IN CASE THE ENTIRE BUSINESS OF ANY CORPORATION, OTHER

THAN A CORPORATION ENGAGED IN DOING BUSINESS AS A REGULATED

INVESTMENT COMPANY AS DEFINED BY THE INTERNAL REVENUE CODE OF

1986, IS NOT TRANSACTED WITHIN THIS COMMONWEALTH, THE TAX

IMPOSED BY THIS ARTICLE SHALL BE BASED UPON SUCH PORTION OF THE

TAXABLE INCOME OF SUCH CORPORATION FOR THE FISCAL OR CALENDAR

YEAR, AS DEFINED IN SUBCLAUSE 1 HEREOF, AND MAY BE DETERMINED AS

FOLLOWS:

(A) DIVISION OF INCOME.

* * *

(9) (A) EXCEPT AS PROVIDED IN SUBPARAGRAPH (B):

20230HB1219PN2089 - 17 -

* * *

(VI) (A) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31,

2024, ALL BUSINESS INCOME OF A UNITARY BUSINESS SHALL BE

APPORTIONED TO THIS STATE BY MULTIPLYING THE INCOME BY THE

MEMBER'S SALES FACTOR, THE NUMERATOR OF WHICH SHALL BE THE

MEMBER'S TOTAL SALES IN THIS STATE, AND THE DENOMINATOR OF WHICH

SHALL BE THE COMBINED TOTAL SALES OF ALL MEMBERS OF THE UNITARY

BUSINESS EVERYWHERE. IN COMPUTING THE SALES OF EACH MEMBER FOR

PURPOSES OF APPORTIONMENT, THE FOLLOWING SALES ARE EXCLUDED FROM

THE NUMERATOR AND DENOMINATOR:

(I) SALES FROM TRANSACTIONS BETWEEN OR AMONG MEMBERS OF THE

UNITARY BUSINESS THAT ARE DEFERRED UNDER 26 CFR 1.1502-13

(RELATING TO INTERCOMPANY TRANSACTIONS) FOR FEDERAL TAXABLE

INCOME PURPOSES; AND

(II) THE SALES OF EACH MEMBER THAT ARE EXCLUDED FROM THE

UNITARY BUSINESS PURSUANT TO THE DEFINITION OF "WATER'S-EDGE

BASIS."

(B) THE PENNSYLVANIA SALES OF EACH NONTAXABLE MEMBER SHALL

BE DETERMINED BASED UPON THE APPORTIONMENT RULES APPLICABLE TO

THE MEMBER AND SHALL BE AGGREGATED. EACH TAXABLE MEMBER OF THE

GROUP SHALL INCLUDE IN ITS SALES FACTOR NUMERATOR A PORTION OF

THE AGGREGATE PENNSYLVANIA SALES OF NONTAXABLE MEMBERS BASED ON

A RATIO, THE NUMERATOR OF WHICH IS THE TAXABLE MEMBER'S

PENNSYLVANIA SALES AND THE DENOMINATOR OF WHICH IS THE AGGREGATE

PENNSYLVANIA SALES OF ALL THE TAXABLE MEMBERS OF THE GROUP.

SHALL BE ALLOCATED AS PROVIDED IN PARAGRAPHS (5) THROUGH (8) OF

PHRASE (A) OF SUBCLAUSE 2 OF THIS DEFINITION. A MEMBER OF THE

UNITARY BUSINESS IS SUBJECT TO TAX ON ITS APPORTIONED SHARE OF

ALL BUSINESS INCOME OF THE UNITARY BUSINESS, PLUS ITS

20230HB1219PN2089 - 18 -

NONBUSINESS INCOME OR LOSS ALLOCATED TO THIS STATE, MINUS THE

MEMBER'S NET LOSS DEDUCTION.

(D) THE SECRETARY OF REVENUE MAY DISTRIBUTE, APPORTION OR

ALLOCATE GROSS INCOME, DEDUCTIONS, CREDITS OR ALLOWANCES BETWEEN

AND AMONG TWO OR MORE CORPORATIONS, PERSONS, ENTITIES, MEMBERS

OR UNITARY BUSINESSES, WHETHER OR NOT INCORPORATED, WHETHER OR

NOT ORGANIZED IN THE UNITED STATES AND WHETHER OR NOT

AFFILIATED, IF:

(I) THE CORPORATIONS, PERSONS, ENTITIES, MEMBERS OR UNITARY

BUSINESSES ARE OWNED OR CONTROLLED DIRECTLY OR INDIRECTLY BY THE

SAME INTERESTS WITHIN THE MEANING OF 26 U.S.C. § 482 (RELATING

TO ALLOCATION OF INCOME AND DEDUCTIONS AMONG TAXPAYERS); AND

(II) THE SECRETARY OF REVENUE DETERMINES THAT THE

DISTRIBUTION, APPORTIONMENT OR ALLOCATION IS NECESSARY IN ORDER

TO REFLECT AN ARM'S LENGTH STANDARD WITHIN THE MEANING OF 26 CFR

1.482-1 (RELATING TO ALLOCATION OF INCOME AND DEDUCTIONS AMONG

TAXPAYERS) AND TO REFLECT CLEARLY THE INCOME OF THOSE

CORPORATIONS, PERSONS, ENTITIES, MEMBERS OR UNITARY BUSINESSES.

(E) THE SECRETARY OF REVENUE SHALL APPLY THE ADMINISTRATIVE

AND JUDICIAL INTERPRETATIONS OF 26 U.S.C. § 482 IN ADMINISTERING

THIS SECTION.

(F) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2024, ANY

MEMBER OF A UNITARY GROUP THAT WOULD OTHERWISE APPORTION ITS

BUSINESS INCOME UNDER PHRASE (B), (C), (D) OR (E) OF SUBCLAUSE 2

OF THIS DEFINITION SHALL DETERMINE ITS APPORTIONMENT FORMULA

USING A SINGLE SALES FRACTION.

* * *

4. * * *

(A) (I) FOR TAXABLE YEARS BEGINNING BEFORE JANUARY 1, 2007,

20230HB1219PN2089 - 19 -

TWO MILLION DOLLARS ($2,000,000);

(II) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2006,

THE GREATER OF TWELVE AND ONE-HALF PER CENT OF TAXABLE INCOME AS

DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR

THREE MILLION DOLLARS ($3,000,000);

(III) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2008,

THE GREATER OF FIFTEEN PER CENT OF TAXABLE INCOME AS DETERMINED

UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR THREE

MILLION DOLLARS ($3,000,000);

(IV) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2009,

THE GREATER OF TWENTY PER CENT OF TAXABLE INCOME AS DETERMINED

UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR THREE

MILLION DOLLARS ($3,000,000);

(V) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2013, THE

GREATER OF TWENTY-FIVE PER CENT OF TAXABLE INCOME AS DETERMINED

UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR FOUR MILLION

DOLLARS ($4,000,000);

(VI) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2014,

THE GREATER OF THIRTY PER CENT OF TAXABLE INCOME AS DETERMINED

UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR FIVE MILLION

DOLLARS ($5,000,000);

(VII) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2017,

THIRTY-FIVE PER CENT OF TAXABLE INCOME AS DETERMINED UNDER

SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2;

(VIII) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2018,

FORTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER SUBCLAUSE 1

OR, IF APPLICABLE, SUBCLAUSE 2; [OR]

(IX) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2023,

FIFTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER SUBCLAUSE 1

OR, IF APPLICABLE, SUBCLAUSE 2;

20230HB1219PN2089 - 20 -

(X) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2024,

SIXTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER SUBCLAUSE 1

OR, IF APPLICABLE, SUBCLAUSE 2;

(XI) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2025,

SEVENTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER SUBCLAUSE

1 OR, IF APPLICABLE, SUBCLAUSE 2; OR

(XII) FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2026,

EIGHTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER SUBCLAUSE

1 OR, IF APPLICABLE, SUBCLAUSE 2; OR

(B) THE AMOUNT OF THE NET LOSS OR LOSSES WHICH MAY BE

CARRIED OVER TO THE TAXABLE YEAR OR TAXABLE INCOME AS DETERMINED

UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2.

* * *

(2) (A) A NET LOSS FOR A TAXABLE YEAR MAY ONLY BE CARRIED

OVER PURSUANT TO THE FOLLOWING SCHEDULE:

TAXABLE YEAR CARRYOVER

1981 1 TAXABLE YEAR

1982 2 TAXABLE YEARS

1983-1987 3 TAXABLE YEARS

1988 2 TAXABLE YEARS PLUS

1 TAXABLE YEAR

STARTING WITH THE

1995 TAXABLE YEAR

1989 1 TAXABLE YEAR PLUS

2 TAXABLE YEARS

STARTING WITH THE

1995 TAXABLE YEAR

1990-1993 3 TAXABLE YEARS

STARTING WITH THE

1995 TAXABLE YEAR

20230HB1219PN2089 - 21 -

1994 1 TAXABLE YEAR

1995-1997 10 TAXABLE YEARS

1998 AND THEREAFTER 20 TAXABLE YEARS

(B) THE EARLIEST NET LOSS SHALL BE CARRIED OVER TO THE

EARLIEST TAXABLE YEAR TO WHICH IT MAY BE CARRIED UNDER THIS

SCHEDULE. THE TOTAL NET LOSS DEDUCTION ALLOWED IN ANY TAXABLE

YEAR SHALL NOT EXCEED:

(I) TWO MILLION DOLLARS ($2,000,000) FOR TAXABLE YEARS

BEGINNING BEFORE JANUARY 1, 2007.

(II) THE GREATER OF TWELVE AND ONE-HALF PER CENT OF THE

TAXABLE INCOME AS DETERMINED UNDER SUBCLAUSE 1 OR, IF

APPLICABLE, SUBCLAUSE 2 OR THREE MILLION DOLLARS ($3,000,000)

FOR TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2006.

(III) THE GREATER OF FIFTEEN PER CENT OF THE TAXABLE INCOME

AS DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2

OR THREE MILLION DOLLARS ($3,000,000) FOR TAXABLE YEARS

BEGINNING AFTER DECEMBER 31, 2008.

(IV) THE GREATER OF TWENTY PER CENT OF THE TAXABLE INCOME AS

DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR

THREE MILLION DOLLARS ($3,000,000) FOR TAXABLE YEARS BEGINNING

AFTER DECEMBER 31, 2009.

(V) THE GREATER OF TWENTY-FIVE PER CENT OF TAXABLE INCOME AS

DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR

FOUR MILLION DOLLARS ($4,000,000) FOR TAXABLE YEARS BEGINNING

AFTER DECEMBER 31, 2013.

(VI) THE GREATER OF THIRTY PER CENT OF TAXABLE INCOME AS

DETERMINED UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 OR

FIVE MILLION DOLLARS ($5,000,000) FOR TAXABLE YEARS BEGINNING

AFTER DECEMBER 31, 2014.

(VII) THIRTY-FIVE PER CENT OF TAXABLE INCOME AS DETERMINED

20230HB1219PN2089 - 22 -

UNDER SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 FOR TAXABLE

YEARS BEGINNING AFTER DECEMBER 31, 2017.

(VIII) FORTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER

SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 FOR TAXABLE YEARS

BEGINNING AFTER DECEMBER 31, 2018.

(IX) FIFTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER

SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 FOR TAXABLE YEARS

BEGINNING AFTER DECEMBER 31, 2023.

(X) SIXTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER

SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 FOR TAXABLE YEARS

BEGINNING AFTER DECEMBER 31, 2024.

(XI) SEVENTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER

SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 FOR TAXABLE YEARS

BEGINNING AFTER DECEMBER 31, 2025.

(XII) EIGHTY PER CENT OF TAXABLE INCOME AS DETERMINED UNDER

SUBCLAUSE 1 OR, IF APPLICABLE, SUBCLAUSE 2 FOR TAXABLE YEARS

BEGINNING AFTER DECEMBER 31, 2026.

* * *

(H) SUBJECT TO THE LIMITATIONS OF THIS SUBCLAUSE, ANY MEMBER

OF A UNITARY BUSINESS THAT HAS UNUSED NET LOSS FROM TAXABLE

YEARS THAT BEGAN PRIOR TO JANUARY 1, 2025, OR THAT GENERATES NET

LOSSES WHILE A MEMBER OF A UNITARY BUSINESS MAY ONLY TAKE THE

NET LOSS DEDUCTION FOR TAXABLE YEARS BEGINNING AFTER DECEMBER

31, 2023, TO THE EXTENT OF THE MEMBER'S SHARE OF COMBINED

UNITARY INCOME AFTER APPORTIONMENT AND THE NET LOSSES MAY NOT BE

USED BY OTHER MEMBERS OF THE SAME UNITARY BUSINESS.

(I) ANY NET LOSS REALIZED FOR A TAXABLE YEAR UNUSED BY A

CORPORATION WHICH SUBSEQUENTLY BECOMES A MEMBER OF ANOTHER

UNITARY BUSINESS, MAY ONLY BE USED BY THAT CORPORATION.

* * *

20230HB1219PN2089 - 23 -

(5) "TAXABLE YEAR." [THE TAXABLE YEAR WHICH THE

CORPORATION, OR ANY CONSOLIDATED GROUP WITH WHICH THE

CORPORATION PARTICIPATES IN THE FILING OF CONSOLIDATED RETURNS,

ACTUALLY USES IN REPORTING TAXABLE INCOME TO THE FEDERAL

GOVERNMENT. WITH REGARD TO THE TAX IMPOSED BY ARTICLE IV OF THIS

ACT (RELATING TO THE CORPORATE NET INCOME TAX), THE TERMS

"ANNUAL YEAR," "FISCAL YEAR," "ANNUAL OR FISCAL YEAR," "TAX

YEAR" AND "TAX PERIOD" SHALL BE THE SAME AS THE CORPORATION'S

TAXABLE YEAR, AS DEFINED IN THIS PARAGRAPH.]

1. EXCEPT AS SET FORTH IN SUBCLAUSE 2, THE TAXABLE YEAR

WHICH THE CORPORATION, OR ANY CONSOLIDATED GROUP WITH WHICH THE

CORPORATION PARTICIPATES IN THE FILING OF CONSOLIDATED RETURNS,

ACTUALLY USES IN REPORTING TAXABLE INCOME TO THE FEDERAL

GOVERNMENT, OR WHICH THE CORPORATION WOULD HAVE USED IN

REPORTING TAXABLE INCOME TO THE FEDERAL GOVERNMENT HAD IT BEEN

REQUIRED TO REPORT ITS TAXABLE INCOME TO THE FEDERAL GOVERNMENT.

WITH REGARD TO THE TAX IMPOSED BY ARTICLE IV, THE TERMS "ANNUAL

YEAR," "FISCAL YEAR," "ANNUAL OR FISCAL YEAR," "TAX YEAR" AND

"TAX PERIOD" SHALL BE THE SAME AS THE CORPORATION'S TAXABLE

YEAR, AS DEFINED IN THIS SUBCLAUSE OR SUBCLAUSE 2.

2. ALL MEMBERS OF A UNITARY BUSINESS SHALL HAVE A COMMON

TAXABLE YEAR FOR PURPOSES OF COMPUTING TAX DUE UNDER THIS

ARTICLE. THE TAXABLE YEAR FOR SUCH PURPOSES IS THE COMMON

TAXABLE YEAR ADOPTED, IN A MANNER PRESCRIBED BY THE DEPARTMENT,

BY ALL MEMBERS OF THE UNITARY BUSINESS. THE COMMON TAXABLE YEAR

MUST BE USED BY ALL MEMBERS OF THE UNITARY BUSINESS IN THE YEAR

OF ADOPTION AND ALL FUTURE YEARS UNLESS OTHERWISE PERMITTED BY

THE DEPARTMENT.

* * *

(12) "TAX HAVEN." ANY OF THE FOLLOWING:

20230HB1219PN2089 - 24 -

(A) ANDORRA.

(B) ANGUILLA.

(D) ARUBA.

(E) THE BAHAMAS.

(F) BAHRAIN.

(G) BARBADOS.

(H) BELIZE.

(I) BERMUDA.

(J) BONAIRE.

(K) THE BRITISH VIRGIN ISLANDS.

(L) THE CAYMAN ISLANDS.

(M) THE COOK ISLANDS.

(N) CURACAO.

(O) CYPRUS.

(P) DOMINICA.

(Q) GIBRALTAR.

(R) GRENADA.

(S) GUERNSEY-SARK-ALDERNEY.

(T) IRELAND.

(U) THE ISLE OF MAN.

(V) JERSEY.

(W) LIBERIA.

(X) LIECHTENSTEIN.

(Y) LUXEMBOURG.

(Z) MALTA.

(AA) THE MARSHALL ISLANDS.

(BB) MAURITIUS.

(CC) MONACO.

(DD) MONTSERRAT.

20230HB1219PN2089 - 25 -

(EE) NAURU.

(FF) THE NETHERLANDS.

(GG) NIUE.

(HH) PANAMA.

(II) SABA.

(JJ) SAMOA.

(KK) SAN MARINO.

(LL) SEYCHELLES.

(MM) SINGAPORE.

(NN) ST. EUSTATIUS.

(OO) ST. KITTS AND NEVIS.

(PP) ST. LUCIA.

(QQ) ST. MAARTEN.

(RR) ST. VINCENT AND THE GRENADINES.

(SS) SWITZERLAND.

(TT) TURKS AND CAICOS ISLANDS.

(UU) VANUATU.

(VV) A JURISDICTION THAT IS IDENTIFIED AS A TAX HAVEN BY THE

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT.

(13) "UNITARY BUSINESS." A SINGLE ECONOMIC ENTERPRISE THAT

IS MADE UP OF SEPARATE PARTS OF A SINGLE CORPORATION, OF A

COMMONLY CONTROLLED GROUP OF CORPORATIONS, OR BOTH, THAT ARE

SUFFICIENTLY INTERDEPENDENT, INTEGRATED AND INTERRELATED THROUGH

THEIR ACTIVITIES SO AS TO PROVIDE A SYNERGY AND MUTUAL BENEFIT

THAT PRODUCES A SHARING OR EXCHANGE OF VALUE AMONG THEM AND A

FLOW OF VALUE TO THE SEPARATE PARTS. A UNITARY BUSINESS INCLUDES

ALL THOSE PARTS AND CORPORATIONS THAT ARE INCLUDED IN A UNITARY

BUSINESS UNDER THE CONSTITUTION OF THE UNITED STATES.

(14) "WATER'S-EDGE BASIS." A SYSTEM OF REPORTING THAT

INCLUDES THE INCOME AND APPORTIONMENT FACTORS OF CERTAIN MEMBERS

20230HB1219PN2089 - 26 -

OF A UNITARY BUSINESS, DESCRIBED AS FOLLOWS:

(A) ANY MEMBER INCORPORATED IN THE UNITED STATES OR FORMED

UNDER THE LAWS OF ANY STATE OF THE UNITED STATES, THE DISTRICT

OF COLUMBIA, ANY TERRITORY OR POSSESSION OF THE UNITED STATES OR

THE COMMONWEALTH OF PUERTO RICO.

(B) ANY MEMBER, REGARDLESS OF THE PLACE INCORPORATED OR

FORMED, IF AT LEAST TWENTY PER CENT OF THE MEMBER'S SALES FACTOR

IS WITHIN THE UNITED STATES, AND THE FOLLOWING SHALL APPLY:

(I) FOR PURPOSES OF DETERMINING WHETHER AT LEAST TWENTY PER

CENT OF A MEMBER'S SALES FACTOR IS WITHIN THE UNITED STATES, THE

CALCULATION MUST BE PERFORMED ON A STAND-ALONE BASIS. SALES

SHALL BE GROSS FIGURES WITHOUT ELIMINATIONS FOR TRANSACTIONS

WITH OTHER MEMBERS OF ANY UNITARY BUSINESS.

(II) WHETHER SALES ARE WITHIN THE UNITED STATES IS BASED ON

THE SALES FACTOR SOURCING RULES CONTAINED IN SECTION 401(3).

(I) A DOMESTIC INTERNATIONAL SALES CORPORATION AS DESCRIBED

IN 26 U.S.C. CH. 1 SUBCH. N PT. IV SUBPT. A (RELATING TO

TREATMENT OF QUALIFYING CORPORATIONS).

(II) A FOREIGN SALES CORPORATION AS DESCRIBED IN 26 U.S.C.

CH. 1 SUBCH. N PT. IV SUBPTS. A AND B (RELATING TO TREATMENT OF

DISTRIBUTIONS TO SHAREHOLDERS).

(III) AN EXPORT TRADE CORPORATION AS DESCRIBED IN 26 U.S.C.

§§ 970 (RELATING TO REDUCTION OF SUBPART F INCOME OF EXPORT

TRADE CORPORATIONS) AND 971 (RELATING TO DEFINITIONS).

(D) ANY MEMBER NOT DESCRIBED IN SUBPARAGRAPH (A), (B) OR (C)

SHALL INCLUDE THE PORTION OF THE MEMBER'S TAXABLE INCOME DERIVED

FROM OR ATTRIBUTABLE TO SOURCES WITHIN THE UNITED STATES, AS

DETERMINED UNDER 26 U.S.C. (RELATING TO INTERNAL REVENUE CODE)

WITHOUT REGARD TO FEDERAL TREATIES, AND ITS APPORTIONMENT

20230HB1219PN2089 - 27 -

FACTORS RELATED THERETO.

(E) ANY MEMBER THAT IS A "CONTROLLED FOREIGN CORPORATION" AS

DEFINED IN 26 U.S.C. § 957 (RELATING TO CONTROLLED FOREIGN

CORPORATIONS; UNITED STATES PERSONS), TO THE EXTENT THE INCOME

OF THAT MEMBER IS INCOME DEFINED IN 26 U.S.C. § 952 (RELATING TO

SUBPART F INCOME DEFINED) AS SUBPART F INCOME, NOT EXCLUDING

LOWER-TIER SUBSIDIARIES' DISTRIBUTIONS OF SUCH INCOME WHICH WERE

PREVIOUSLY TAXED, DETERMINED WITHOUT REGARD TO FEDERAL TREATIES,

AND THE APPORTIONMENT FACTORS RELATED TO THAT INCOME; ANY ITEM

OF INCOME RECEIVED BY A CONTROLLED FOREIGN CORPORATION AND THE

APPORTIONMENT FACTORS RELATED TO SUCH INCOME SHALL BE EXCLUDED

IF THE CORPORATION ESTABLISHES TO THE SATISFACTION OF THE

SECRETARY OF REVENUE THAT SUCH INCOME WAS SUBJECT TO AN

EFFECTIVE RATE OF INCOME TAX IMPOSED BY A FOREIGN COUNTRY

GREATER THAN NINETY PER CENT OF THE MAXIMUM RATE OF TAX

SPECIFIED IN 26 U.S.C. § 11 (RELATING TO TAX IMPOSED). THE

EFFECTIVE RATE OF INCOME TAX DETERMINATION SHALL BE BASED UPON

THE METHODOLOGY SET FORTH UNDER 26 CFR 1.954-1 (RELATING TO

FOREIGN BASE COMPANY INCOME).

(F) ANY MEMBER THAT IS INCORPORATED IN OR IS DOING BUSINESS

IN A TAX HAVEN. THE INCOME AND APPORTIONMENT FACTORS OF A MEMBER

DOING BUSINESS IN A TAX HAVEN SHALL BE EXCLUDED IF THE MEMBER

ESTABLISHES TO THE SATISFACTION OF THE SECRETARY OF REVENUE THAT

THE MEMBER'S INCOME WAS SUBJECT TO AN EFFECTIVE RATE OF INCOME

TAX IMPOSED BY A COUNTRY GREATER THAN NINETY PER CENT OF THE

MAXIMUM RATE OF TAX SPECIFIED IN 26 U.S.C. § 11.

(15) "COMMONLY CONTROLLED GROUP." FOR A CORPORATION, THE

CORPORATION IS A MEMBER OF A GROUP OF TWO OR MORE CORPORATIONS

AND MORE THAN FIFTY PER CENT OF THE VOTING STOCK OR CONTROLLING

INTEREST OF EACH MEMBER OF THE GROUP IS DIRECTLY OR INDIRECTLY

20230HB1219PN2089 - 28 -

OWNED BY A COMMON OWNER OR BY COMMON OWNERS, EITHER CORPORATE OR

NONCORPORATE, OR BY ONE OR MORE OF THE MEMBER CORPORATIONS OF

THE GROUP.

(16) "COMBINED UNITARY INCOME." THE AGGREGATE TAXABLE

INCOME OR LOSS OF ALL MEMBERS OF A UNITARY BUSINESS, SUBJECT TO

APPORTIONMENT, EXCEPT:

(A) INCOME FROM AN INTERCOMPANY TRANSACTION BETWEEN MEMBERS

OF A UNITARY BUSINESS SHALL BE DEFERRED IN A MANNER SIMILAR TO

26 CFR 1.1502-13 (RELATING TO INTERCOMPANY TRANSACTIONS) FOR

FEDERAL TAXABLE INCOME PURPOSES.

(B) DIVIDENDS PAID BY ONE MEMBER OF A UNITARY BUSINESS TO

ANOTHER.

DETERMINATION OF COMBINED UNITARY INCOME:

(I) ANY MEMBER SUBJECT TO TAXATION UNDER ARTICLE VII, VIII,

IX OR XV;

(II) ANY MEMBER SPECIFIED IN THE DEFINITION OF "INSTITUTION"

IN SECTION 701.5 THAT WOULD BE SUBJECT TO TAXATION UNDER ARTICLE

VII, WERE IT DOING BUSINESS IN THIS STATE, AS DEFINED IN SECTION

701.5;

(III) ANY MEMBER COMMONLY KNOWN AS A TITLE INSURANCE COMPANY

THAT WOULD BE SUBJECT TO TAXATION UNDER ARTICLE VIII, WERE IT

INCORPORATED IN THIS STATE;

(IV) ANY MEMBER SPECIFIED AS AN INSURANCE COMPANY,

ASSOCIATION OR EXCHANGE IN ARTICLE IX THAT WOULD BE SUBJECT TO

TAXATION UNDER ARTICLE IX, WERE IT TRANSACTING INSURANCE

BUSINESS IN THIS STATE;

(V) ANY MEMBER SPECIFIED IN THE DEFINITION OF "INSTITUTION"

IN SECTION 1501 THAT WOULD BE SUBJECT TO TAXATION UNDER ARTICLE

XV, WERE IT LOCATED, AS DEFINED IN SECTION 1501, IN THIS STATE;

20230HB1219PN2089 - 29 -

(VI) ANY MEMBER THAT IS A SMALL CORPORATION AS DEFINED IN

SECTION 301(S.2) EXCEPT TO THE EXTENT OF SUCH SMALL

CORPORATION'S NET RECOGNIZED BUILT-IN GAIN TO THE EXTENT OF AND

AS DETERMINED FOR FEDERAL INCOME TAX PURPOSES UNDER 26 U.S.C. §

1374(D)(2) (RELATING TO TAX IMPOSED ON CERTAIN BUILT-IN GAINS).

(17) "MEMBER." A CORPORATION THAT IS A MEMBER OF A UNITARY

BUSINESS. THE TERM DOES NOT INCLUDE A CORPORATION LISTED IN

CLAUSE (15)(C).

SECTION 3. SECTION 402(B) OF THE ACT, AMENDED JULY 8, 2022

(P.L.513, NO.53), IS AMENDED TO READ:

SECTION 402. IMPOSITION OF TAX.--* * *

(B) THE ANNUAL RATE OF TAX ON CORPORATE NET INCOME IMPOSED

BY SUBSECTION (A) FOR TAXABLE YEARS BEGINNING FOR THE CALENDAR

YEAR OR FISCAL YEAR ON OR AFTER THE DATES SET FORTH SHALL BE AS

FOLLOWS:

TAXABLE YEAR TAX RATE

JANUARY 1, 1995,

THROUGH DECEMBER

31, 2022 9.99%

JANUARY 1, 2023,

THROUGH DECEMBER

31, 2023 [8.99%] 7.99%

JANUARY 1, 2024,

THROUGH DECEMBER

31, 2024 [8.49%] 6.99%

JANUARY 1, 2025,

THROUGH DECEMBER

31, 2025 [7.99%] 5.99%

JANUARY 1, 2026,

20230HB1219PN2089 - 30 -

[THROUGH DECEMBER

31, 2026] AND EACH

TAXABLE YEAR

THEREAFTER

[7.49%] 4.99%

[JANUARY 1, 2027,

THROUGH DECEMBER

31, 2027 6.99%

JANUARY 1, 2028,

THROUGH DECEMBER

31, 2028 6.49%

JANUARY 1, 2029,

THROUGH DECEMBER

31, 2029 5.99%

JANUARY 1, 2030,

THROUGH DECEMBER

31, 2030 5.49%

JANUARY 1, 2031, AND

EACH TAXABLE YEAR

THEREAFTER 4.99%]

* * *

SECTION 4. SECTION 403 OF THE ACT IS AMENDED BY ADDING

SUBSECTIONS TO READ:

SECTION 403. REPORTS AND PAYMENT OF TAX.--* * *

(A.1) (1) EACH CORPORATION THAT IS A MEMBER OF A UNITARY

BUSINESS THAT CONSISTS OF TWO OR MORE CORPORATIONS, UNLESS

EXCLUDED BY THE PROVISIONS OF THIS ARTICLE, SHALL FILE AS PART

OF A COMBINED ANNUAL REPORT. THE MEMBER OF THE UNITARY BUSINESS

SHALL DESIGNATE ONE MEMBER THAT IS SUBJECT TO TAX UNDER THIS

ARTICLE TO FILE THE COMBINED ANNUAL REPORT AND TO ACT AS AGENT

ON BEHALF OF ALL OTHER MEMBERS OF THE UNITARY BUSINESS. EACH

20230HB1219PN2089 - 31 -

CORPORATION THAT IS A MEMBER OF A UNITARY BUSINESS IS LIABLE FOR

ITS TAX LIABILITY UNDER THIS ARTICLE. THE AGENT IS ALSO LIABLE

FOR THE AGGREGATE AMOUNT OF THE UNITARY BUSINESS' TAX LIABILITY

PURSUANT TO THIS ARTICLE.

(2) THE OATH OR AFFIRMATION OF THE DESIGNATED MEMBER'S

PRESIDENT, VICE PRESIDENT, TREASURER, ASSISTANT TREASURER OR

OTHER AUTHORIZED OFFICER SHALL CONSTITUTE THE OATH OR

AFFIRMATION OF EACH CORPORATION THAT IS A MEMBER OF THAT UNITARY

BUSINESS.

(3) THE DESIGNATED MEMBER SHALL TRANSMIT TO THE DEPARTMENT

UPON A FORM PRESCRIBED BY THE DEPARTMENT A COMBINED ANNUAL

REPORT UNDER OATH OR AFFIRMATION OF THE MEMBER'S PRESIDENT, VICE

PRESIDENT, TREASURER, ASSISTANT TREASURER OR OTHER AUTHORIZED

OFFICER.

(4) IN ADDITION TO THE INFORMATION REQUIRED IN SUBSECTION

(A), THE COMBINED ANNUAL REPORT SHALL SET FORTH:

(I) ALL MEMBERS INCLUDED IN THE UNITARY BUSINESS.

(II) ALL NECESSARY DATA, BOTH IN THE AGGREGATE AND FOR EACH

MEMBER OF THE UNITARY BUSINESS, THAT SETS FORTH THE

DETERMINATION OF TAX LIABILITY FOR EACH MEMBER OF THE UNITARY

BUSINESS.

(III) ANY OTHER INFORMATION THAT THE DEPARTMENT MAY REQUIRE.

(A.2) A MEMBER OF A UNITARY BUSINESS OF TWO OR MORE

CORPORATIONS MUST DETERMINE THE MEMBER'S INCOME AND

APPORTIONMENT FACTORS ON A WATER'S-EDGE BASIS.

* * *

SECTION 5. SECTIONS 404 AND 407.7 OF THE ACT ARE AMENDED TO

READ:

SECTION 404. CONSOLIDATED REPORTS.--THE DEPARTMENT SHALL NOT

PERMIT ANY CORPORATION OWNING OR CONTROLLING, DIRECTLY OR

20230HB1219PN2089 - 32 -

INDIRECTLY, ANY OF THE VOTING CAPITAL STOCK OF ANOTHER

CORPORATION OR OF OTHER CORPORATIONS, SUBJECT TO THE PROVISIONS

OF THIS ARTICLE, TO MAKE A CONSOLIDATED REPORT[, SHOWING THE

COMBINED NET INCOME].

SECTION 407.7. MANUFACTURING INNOVATION AND REINVESTMENT

DEDUCTION.--(A) IN ORDER TO BE ELIGIBLE TO RECEIVE A

MANUFACTURING INNOVATION AND REINVESTMENT DEDUCTION, A TAXPAYER

MUST DEMONSTRATE TO THE DEPARTMENT A PRIVATE CAPITAL INVESTMENT

IN EXCESS OF [SIXTY MILLION DOLLARS ($60,000,000)] FIFTY MILLION

DOLLARS ($50,000,000) FOR THE CREATION OF NEW OR REFURBISHED

MANUFACTURING CAPACITY WITHIN [THREE YEARS OF A DESIGNATED START

DATE] THE APPLICABLE TIME PERIOD SPECIFIED IN SUBSECTION (B).

(B) (1) A TAXPAYER MUST ADVISE THE DEPARTMENT IN ADVANCE OF

THE START DATE OF ANY PROJECT FOR WHICH THE TAXPAYER MAY SEEK A

QUALIFIED MANUFACTURING INNOVATION AND REINVESTMENT DEDUCTION. A

TAXPAYER MUST ATTEST THE TAXPAYER'S INTENT TO MEET THE

ELIGIBILITY CRITERIA AND PROVIDE RELEVANT INFORMATION PERTINENT

TO THE PROJECT'S SIZE AND SCOPE IN A MANNER AS DETERMINED BY THE

DEPARTMENT.

(2) FOR A PRIVATE CAPITAL INVESTMENT OF LESS THAN OR EQUAL

TO ONE HUNDRED FIFTY MILLION DOLLARS ($150,000,000), THE

FOLLOWING SHALL APPLY:

(I) THE PROJECT MUST BE COMPLETED WITHIN THREE YEARS OF THE

PROJECT'S START DATE.

(II) WITHIN FIVE YEARS OF [A] THE PROJECT'S START DATE, [A]

THE TAXPAYER MUST COMPLETE TO THE DEPARTMENT'S SATISFACTION AN

APPLICATION ON A FORM AND IN A MANNER AS DETERMINED BY THE

DEPARTMENT TO ATTEST THAT THE PROJECT HAS BEEN COMPLETED AND THE

ELIGIBILITY CRITERIA HAS BEEN SATISFIED.

(3) FOR A PRIVATE CAPITAL INVESTMENT GREATER THAN ONE

20230HB1219PN2089 - 33 -

HUNDRED FIFTY MILLION ONE DOLLARS ($150,000,001) AND LESS THAN

TWO HUNDRED FIFTY MILLION DOLLARS ($250,000,000), THE FOLLOWING

SHALL APPLY:

(I) THE PROJECT MUST BE COMPLETED WITHIN FIVE YEARS OF THE

PROJECT'S START DATE.

(II) WITHIN SEVEN YEARS OF THE PROJECT'S START DATE, THE

TAXPAYER MUST COMPLETE TO THE DEPARTMENT'S SATISFACTION AN

APPLICATION ON A FORM AND IN A MANNER AS DETERMINED BY THE

DEPARTMENT TO ATTEST THAT THE PROJECT HAS BEEN COMPLETED AND THE

ELIGIBILITY CRITERIA HAS BEEN SATISFIED.

(4) FOR A PRIVATE CAPITAL INVESTMENT GREATER THAN TWO

HUNDRED FIFTY MILLION ONE DOLLARS ($250,000,001) AND LESS THAN

THREE HUNDRED FIFTY MILLION DOLLARS ($350,000,000), THE

FOLLOWING SHALL APPLY:

(I) THE PROJECT MUST BE COMPLETED WITHIN SEVEN YEARS OF THE

PROJECT'S START DATE.

(II) WITHIN NINE YEARS OF THE PROJECT'S START DATE, THE

TAXPAYER MUST COMPLETE TO THE DEPARTMENT'S SATISFACTION AN

APPLICATION ON A FORM AND IN A MANNER AS DETERMINED BY THE

DEPARTMENT TO ATTEST THAT THE PROJECT HAS BEEN COMPLETED AND THE

ELIGIBILITY CRITERIA HAS BEEN SATISFIED.

(5) FOR A PRIVATE CAPITAL INVESTMENT GREATER THAN THREE

HUNDRED FIFTY MILLION ONE DOLLARS ($350,000,001), THE DEPARTMENT

SHALL ESTABLISH THE TIME PERIOD FROM THE PROJECT'S START DATE IN

WHICH THE PROJECT MUST BE COMPLETED AND THE TIME PERIOD IN WHICH

THE APPLICATION AS DESCRIBED IN PARAGRAPH (4) MUST BE COMPLETED.

DEPARTMENT OF REVENUE [MUST] SHALL MAKE A FINDING [THAT] WHETHER

THE APPLICANT HAS FILED ALL REQUIRED STATE TAX REPORTS AND

RETURNS FOR ALL APPLICABLE TAX YEARS AND PAID ANY BALANCE OF

20230HB1219PN2089 - 34 -

STATE TAX DUE AS DETERMINED AT SETTLEMENT, ASSESSMENT OR

DETERMINATION, AND THE DEPARTMENT, THEN IN CONJUNCTION WITH THE

DEPARTMENT OF REVENUE, SHALL MAKE AN ELIGIBILITY OR SATISFACTION

DETERMINATION WITHIN NINETY DAYS OF SUBMISSION. IF THE

DEPARTMENT MAKES A SATISFACTION DETERMINATION, THE DEPARTMENT

AND THE TAXPAYER SHALL EXECUTE A SATISFACTION COMMITMENT LETTER

CONTAINING THE FOLLOWING:

(1) THE NUMBER OF NEW JOBS CREATED AND THEIR CORRESPONDING

DESCRIPTION.

(2) THE NUMBER OF NEW JOBS CREATED DURING CONSTRUCTION OF

THE PROJECT.

(3) THE AMOUNT OF PRIVATE CAPITAL INVESTMENT IN THE CREATION

OF NEW JOBS.

(4) THE INCREASE IN THE ANNUAL TAXABLE PAYROLL ATTRIBUTABLE

TO NEW MANUFACTURING JOBS.

(5) A DETERMINATION OF THE MAXIMUM ALLOWABLE DEDUCTION

AGAINST A TAXPAYER'S QUALIFIED TAX LIABILITY UNDER THIS ARTICLE.

(6) ANY OTHER INFORMATION AS THE DEPARTMENT DEEMS

APPROPRIATE.

(D) (1.1) IF THE PRIVATE CAPITAL INVESTMENT IS IN EXCESS OF

SIXTY MILLION DOLLARS ($60,000,000), BUT NOT MORE THAN ONE

HUNDRED MILLION DOLLARS ($100,000,000), THE MAXIMUM ALLOWABLE

DEDUCTION SHALL BE EQUAL TO THIRTY-SEVEN AND ONE-HALF PER CENT

OF THE PRIVATE CAPITAL INVESTMENT UTILIZED IN THE CREATION OF

NEW OR REFURBISHED MANUFACTURING CAPACITY. A TAXPAYER MAY

UTILIZE THE DEDUCTION IN AN AMOUNT NOT TO EXCEED SEVEN AND ONE-

HALF PER CENT OF THE PRIVATE CAPITAL INVESTMENT UTILIZED IN THE

CREATION OF NEW OR REFURBISHED MANUFACTURING CAPACITY IN ANY ONE

YEAR OF THE SUCCEEDING TEN TAX YEARS IMMEDIATELY FOLLOWING THE

DEPARTMENT'S SATISFACTION DETERMINATION AND THE EXECUTION OF A

20230HB1219PN2089 - 35 -

SATISFACTION COMMITMENT LETTER, UP TO THE MAXIMUM ALLOWABLE

DEDUCTION. THIS PARAGRAPH SHALL ONLY APPLY TO APPLICATIONS MADE

PRIOR TO JANUARY 1, 2024.

(1.2) IF [THE] A TAXPAYER'S PRIVATE CAPITAL INVESTMENT FOR A

PROJECT EXCEEDS [ONE HUNDRED MILLION DOLLARS ($100,000,000)]

FIFTY MILLION DOLLARS ($50,000,000), THE MAXIMUM ALLOWABLE

DEDUCTION SHALL BE EQUAL TO TWENTY-FIVE PER CENT OF THE PRIVATE

CAPITAL INVESTMENT UTILIZED IN THE CREATION OF NEW OR

REFURBISHED MANUFACTURING CAPACITY. A TAXPAYER MAY UTILIZE THE

DEDUCTION IN AN AMOUNT NOT TO EXCEED FIVE PER CENT OF THE

PRIVATE CAPITAL INVESTMENT UTILIZED IN THE CREATION OF NEW OR

REFURBISHED MANUFACTURING CAPACITY IN ANY ONE YEAR OF THE

SUCCEEDING TEN TAX YEARS IMMEDIATELY FOLLOWING THE DEPARTMENT'S

SATISFACTION DETERMINATION AND THE EXECUTION OF A SATISFACTION

COMMITMENT LETTER, UP TO THE MAXIMUM ALLOWABLE DEDUCTION.

(1.3) IF A TAXPAYER EXECUTES A SATISFACTION COMMITMENT

LETTER FOR MORE THAN TWO CONCURRENT PROJECTS WITH A TOTAL

PRIVATE CAPITAL INVESTMENT EXCEEDING FIVE HUNDRED MILLION

DOLLARS ($500,000,000), THE MAXIMUM ALLOWABLE DEDUCTION FOR ANY

SUCCEEDING PROJECT SHALL BE EQUAL TO TWENTY-FIVE PER CENT OF THE

PRIVATE CAPITAL INVESTMENT UTILIZED IN THE CREATION OF NEW OR

REFURBISHED MANUFACTURING CAPACITY. A TAXPAYER MAY UTILIZE THE

DEDUCTION IN AN AMOUNT NOT TO EXCEED FIVE PER CENT OF THE

PRIVATE CAPITAL INVESTMENT UTILIZED IN THE CREATION OF NEW OR

REFURBISHED MANUFACTURING CAPACITY IN ANY ONE YEAR OF THE

SUCCEEDING TWENTY TAX YEARS IMMEDIATELY FOLLOWING THE

DEPARTMENT'S SATISFACTION DETERMINATION AND THE EXECUTION OF A

SATISFACTION COMMITMENT LETTER, UP TO THE MAXIMUM ALLOWABLE

DEDUCTION.

(3) A TAXPAYER CANNOT USE THE DEDUCTION TO REDUCE [ITS] THE

20230HB1219PN2089 - 36 -

TAXPAYER'S TAX LIABILITY BY MORE THAN FIFTY PER CENT OF THE TAX

LIABILITY UNDER THIS ARTICLE FOR THE TAXABLE YEAR. THE DEDUCTION

IS NONTRANSFERABLE AND ANY UNUSED PORTION IN A TAX YEAR SHALL

EXPIRE AT THE END OF THE CORRESPONDING TAX YEAR.

SECTION 6. SECTION 1102-C.6(B) OF THE ACT, AMENDED NOVEMBER

3, 2022 (P.L.1695, NO.108), IS AMENDED TO READ:

SECTION 1102-C.6. TRANSFER OF TAX.--* * *

(B) THE AMOUNT TRANSFERRED UNDER SUBSECTION (A) MAY NOT

EXCEED THE FOLLOWING:

(1) FOR EACH FISCAL YEAR BEGINNING AFTER JUNE 30, 2019, AND

ENDING PRIOR TO JULY 1, 2023, FORTY MILLION DOLLARS

($40,000,000).

[(2) FOR THE FISCAL YEAR BEGINNING JULY 1, 2023, AND EACH

FISCAL YEAR THEREAFTER, SIXTY MILLION DOLLARS ($60,000,000).]

(3) FOR THE FISCAL YEAR BEGINNING JULY 1, 2023, SIXTY

MILLION DOLLARS ($60,000,000).

(4) FOR THE FISCAL YEAR BEGINNING JULY 1, 2024, EIGHTY

MILLION DOLLARS ($80,000,000).

(5) FOR THE FISCAL YEAR BEGINNING JULY 1, 2025, AND EACH

FISCAL YEAR THEREAFTER, NINETY MILLION DOLLARS ($90,000,000).

(6) FOR THE FISCAL YEAR BEGINNING JULY 1, 2026, AND EACH

FISCAL YEAR THEREAFTER, ONE HUNDRED MILLION DOLLARS

($100,000,000).

* * *

SECTION 7. THE DEFINITION OF "TAX CREDIT" IN SECTION 1701-

A.1 OF THE ACT IS AMENDED TO READ:

SECTION 1701-A.1. 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:

20230HB1219PN2089 - 37 -

* * *

"TAX CREDIT." A TAX CREDIT AUTHORIZED UNDER ANY OF THE

FOLLOWING:

(1) ARTICLE XVII-B.

(2) ARTICLE XVII-D.

(3) ARTICLE XVII-E.

(4) ARTICLE XVII-G.

(5) ARTICLE XVII-H.

(6) ARTICLE XVII-I.

(7) ARTICLE XVII-J.

(8) ARTICLE XVII-K.

(8.1) ARTICLE XVII-L.

(9) ARTICLE XVIII.

(10) ARTICLE XVIII-B.

(11) ARTICLE XVIII-D.

(12) ARTICLE XVIII-E.

(13) ARTICLE XVIII-F.

(14) ARTICLE XVIII-G.

(14.1) ARTICLE XVIII-H.

(15) ARTICLE XIX-A.

(15.1) ARTICLE XIX-C.

(16) ARTICLE XIX-E.

(16.1) ARTICLE XIX-F.

(17) SECTION 2010.

[(19) ARTICLE XX-B OF THE ACT OF MARCH 10, 1949 (P.L.30,

NO.14), KNOWN AS THE PUBLIC SCHOOL CODE OF 1949.]

(20) THE ACT OF DECEMBER 1, 2004 (P.L.1750, NO.226),

KNOWN AS THE FIRST CLASS CITIES ECONOMIC DEVELOPMENT DISTRICT

ACT.

(21) 12 PA.C.S. CH. 34 (RELATING TO INFRASTRUCTURE AND

20230HB1219PN2089 - 38 -

FACILITIES IMPROVEMENT PROGRAM).

(22) ANY OTHER PROGRAM ESTABLISHED BY A LAW OF THIS

COMMONWEALTH IN WHICH A PERSON APPLIES FOR AND RECEIVES A

CREDIT AGAINST A TAX. THIS PARAGRAPH SHALL NOT APPLY TO A

CREDIT AGAINST A TAX LIABILITY AS A RESULT OF AN OVERPAYMENT.

* * *

SECTION 8. (RESERVED).

SECTION 9. SECTION 1711-D OF THE ACT IS AMENDED BY ADDING

DEFINITIONS TO READ:

SECTION 1711-D. DEFINITIONS.

THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS SUBARTICLE

SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE

CONTEXT CLEARLY INDICATES OTHERWISE:

* * *

"MAINTAINS A PLACE OF BUSINESS" OR "MAINTAINING A PLACE OF

BUSINESS." ALL OF THE FOLLOWING:

(1) OWNING OR RENTING AT LEAST 5,000 SQUARE FEET OF

OFFICE, WAREHOUSE OR OTHER SPACE WITHIN THIS COMMONWEALTH.

(2) USING AN OFFICE, WAREHOUSE OR OTHER SPACE LOCATED

WITHIN THIS COMMONWEALTH TO SELL, LEASE, MANUFACTURE OR

DELIVER TANGIBLE PERSONAL PROPERTY OR THE PERFORMANCE OF A

SERVICE.

(3) EMPLOYING AT LEAST FIVE INDIVIDUALS SUBJECT TO

PENNSYLVANIA EMPLOYMENT TAXES IN THE SALE, LEASE, MANUFACTURE

OR DELIVERY OF TANGIBLE PERSONAL PROPERTY OR IN THE

PERFORMANCE OF A SERVICE.

(4) IF IN THE BUSINESS OF SELLING, LEASING MANUFACTURING

OR DELIVERING TANGIBLE PERSONAL PROPERTY, MAINTAINING AN

INVENTORY OF TANGIBLE PERSONAL PROPERTY WITHIN THIS

COMMONWEALTH FOR THE SALE, LEASE OR DELIVERY TO RESIDENTS OF

20230HB1219PN2089 - 39 -

OR ENTITIES DOING BUSINESS IN THIS COMMONWEALTH.

(5) REGULARLY ENGAGING IN THE LEASE, SALE OR DELIVERY OF

TANGIBLE PERSONAL PROPERTY OR THE PERFORMANCE OF A SERVICE AS

A BUSINESS FOR RESIDENTS OF OR ENTITIES DOING BUSINESS IN

THIS COMMONWEALTH.

* * *

"QUALIFIED LOCATION IN THIS COMMONWEALTH." A COUNTY IN THIS

COMMONWEALTH, EXCEPT FOR:

(1) A COUNTY OF THE FIRST CLASS.

(2) A COUNTY OF THE SECOND CLASS.

(3) A COUNTY OF THE SECOND CLASS A.

(4) A HOME RULE COUNTY THAT WAS FORMERLY A COUNTY OF THE

SECOND CLASS A.

(5) A COUNTY OF THE THIRD CLASS THAT EITHER:

(I) SHARES A BORDER WITH A HOME RULE COUNTY THAT WAS

FORMERLY A COUNTY OF THE SECOND CLASS A; OR

(II) SHARES A BORDER WITH A COUNTY OF THE SECOND

CLASS.

(6) A COUNTY OF THE FOURTH CLASS THAT EITHER:

(I) SHARES A BORDER WITH A COUNTY OF THE SECOND

CLASS; OR

(II) SHARES A BORDER WITH A COUNTY OF THE THIRD

CLASS THAT SHARES A BORDER WITH A COUNTY OF THE SECOND

CLASS.

(7) A COUNTY OF THE SIXTH CLASS THAT SHARES A BORDER

WITH A COUNTY OF THE FOURTH CLASS THAT SHARES A BORDER WITH A

COUNTY OF THE SECOND CLASS.

* * *

"REPRESENTATIVE." A PERSON THAT MEETS ALL OF THE FOLLOWING

CRITERIA:

20230HB1219PN2089 - 40 -

(1) IS AUTHORIZED TO COMMUNICATE WITH THE DEPARTMENT ON

BEHALF OF A TAXPAYER REGARDING AN APPLICATION SUBMITTED UNDER

SECTION 1712-D.

(2) MAINTAINS A PLACE OF BUSINESS IN THIS COMMONWEALTH.

(3) HAS SUBSTANTIAL EXPERIENCE WORKING WITH THE

ENTERTAINMENT PRODUCTION TAX CREDITS.

(4) HAS EMPLOYEES WHO ARE REGISTERED WITH THE DEPARTMENT

OF REVENUE IN ACCORDANCE WITH SECTION 1706-A.1.

* * *

SECTION 10. SECTION 1712-D(B) OF THE ACT, AMENDED JULY 8,

2022 (P.L.513, NO.53), IS AMENDED TO READ:

SECTION 1712-D. CREDIT FOR QUALIFIED FILM PRODUCTION

EXPENSES.

* * *

(B) REVIEW AND APPROVAL.--THE DEPARTMENT SHALL ESTABLISH

APPLICATION PERIODS NOT TO EXCEED 90 DAYS EACH. ALL APPLICATIONS

RECEIVED DURING THE APPLICATION PERIOD SHALL BE REVIEWED AND

EVALUATED BY THE DEPARTMENT BASED ON THE FOLLOWING CRITERIA:

(1) THE ANTICIPATED NUMBER OF PRODUCTION DAYS IN A

QUALIFIED PRODUCTION FACILITY.

(2) THE ANTICIPATED NUMBER OF PENNSYLVANIA EMPLOYEES.

(3) THE NUMBER OF PREPRODUCTION DAYS THROUGH

POSTPRODUCTION DAYS IN PENNSYLVANIA.

(4) THE ANTICIPATED NUMBER OF DAYS SPENT IN PENNSYLVANIA

HOTELS[.], EXCEPT IN CONNECTION WITH THE PENNSYLVANIA FILM

PRODUCER RESERVE FOR WHICH THE ANTICIPATED NUMBER OF DAYS

SPENT IN PENNSYLVANIA HOTELS SHALL NOT APPLY AS EVALUATION

CRITERIA.

(5) THE PENNSYLVANIA PRODUCTION EXPENSES IN COMPARISON

TO THE PRODUCTION BUDGET.

20230HB1219PN2089 - 41 -

(5.1) FOR A PENNSYLVANIA FILM PRODUCER, THE PORTION OF

ALL PREPRODUCTION EXPENSES, PRODUCTION EXPENSES AND

POSTPRODUCTION EXPENSES INCURRED IN PENNSYLVANIA.

(6) THE USE OF STUDIO RESOURCES[.], IF THE RESOURCES ARE

PERMANENTLY LOCATED IN AND OWNED BY THE TAXPAYERS OF THIS

COMMONWEALTH.

(7) IF THE APPLICATION INCLUDES A QUALIFIED

POSTPRODUCTION EXPENSE:

(I) THE QUALIFIED POSTPRODUCTION FACILITY WHERE THE

ACTIVITY WILL OCCUR.

(II) THE ANTICIPATED TYPE OF POSTPRODUCTION ACTIVITY

THAT WILL BE CONDUCTED.

(7.1) IF A MULTIFILM PRODUCTION APPLICATION IS

SUBMITTED, THE DEPARTMENT SHALL CONSIDER THE ABILITY OF THE

TAXPAYER TO PRODUCE MULTIPLE FILMS WITHIN THIS COMMONWEALTH

DURING THE PROPOSED PERIOD OF PRODUCTION AND THE POTENTIAL

ECONOMIC IMPACT, INCLUDING TOURISM IMPACT, OF THE MULTIPLE

FILMS TO THIS COMMONWEALTH. THE TAXPAYER MAY SUPPLEMENT THE

MULTIFILM PRODUCTION APPLICATION WITH ADDITIONAL FILMS DURING

THE PERIOD OF PRODUCTION. THE DEPARTMENT MAY ANNUALLY EXTEND

THE MULTIFILM PRODUCTION APPLICATION'S PERIOD OF PRODUCTION

BEFORE THE EXPIRATION OF THE PERIOD OF PRODUCTION. THE

TAXPAYER MAY NOT INCLUDE A FILM IN THE MULTIFILM PRODUCTION

APPLICATION THAT WAS THE SUBJECT OF AN APPLICATION SUBMITTED

UNDER THIS SUBSECTION BEFORE JANUARY 1, 2022.

(7.2) THE FILM WILL BE PRODUCED BY A PENNSYLVANIA FILM

PRODUCER.

(7.3) THE TAXPAYER APPLYING FOR CREDITS IS A

PENNSYLVANIA FILM PRODUCER.

(7.4) THE TAXPAYER APPLYING FOR CREDITS IS A MINORITY-

20230HB1219PN2089 - 42 -

OWNED BUSINESS OR WOMEN-OWNED BUSINESS, AS THOSE TERMS ARE

DEFINED IN 74 PA.C.S. § 303(B) (RELATING TO DIVERSE BUSINESS

PARTICIPATION).

(8) OTHER CRITERIA THAT THE DIRECTOR OF THE PENNSYLVANIA

FILM OFFICE DEEMS APPROPRIATE TO ENSURE THE GROWTH AND

PROSPERITY OF THE LOCAL PENNSYLVANIA FILM INDUSTRY AND

PENNSYLVANIA FILM PRODUCERS OR YIELD MAXIMUM EMPLOYMENT AND

BENEFIT WITHIN THIS COMMONWEALTH.

UPON DETERMINING THE TAXPAYER HAS INCURRED OR WILL INCUR

QUALIFIED FILM PRODUCTION EXPENSES, THE DEPARTMENT MAY APPROVE

THE TAXPAYER FOR A TAX CREDIT. APPLICATIONS NOT APPROVED MAY BE

REVIEWED AND CONSIDERED IN SUBSEQUENT APPLICATION PERIODS. THE

DEPARTMENT MAY APPROVE A TAXPAYER FOR A TAX CREDIT BASED ON ITS

EVALUATION OF THE CRITERIA UNDER THIS SUBSECTION.

* * *

SECTION 11. SECTION 1714-D(F)(2) OF THE ACT IS AMENDED TO

READ:

SECTION 1714-D. CARRYOVER, CARRYBACK AND ASSIGNMENT OF CREDIT.

* * *

(F) PURCHASERS AND ASSIGNEES.--EXCEPT AS PROVIDED IN

SUBSECTIONS (G) AND (H), THE FOLLOWING APPLY:

* * *

(2) THE AMOUNT OF THE TAX CREDIT THAT A PURCHASER OR

ASSIGNEE MAY USE AGAINST ANY ONE QUALIFIED TAX LIABILITY MAY

NOT EXCEED [50%] 75% OF SUCH QUALIFIED TAX LIABILITY FOR THE

TAXABLE YEAR.

* * *

SECTION 11.1. SECTION 1716-D(A), (B), (E) AND (F) OF THE

ACT, AMENDED OR ADDED JULY 8, 2022 (P.L.513, NO.53), ARE AMENDED

TO READ:

20230HB1219PN2089 - 43 -

SECTION 1716-D. LIMITATIONS.

(A) CAP.--EXCEPT FOR TAX CREDITS REISSUED UNDER SECTION

1716.1-D, IN NO CASE SHALL THE AGGREGATE AMOUNT OF TAX CREDITS

AWARDED IN ANY FISCAL YEAR UNDER THIS SUBARTICLE EXCEED

[$100,000,000] $150,000,000. THE DEPARTMENT MAY, IN ITS

DISCRETION, AWARD IN ONE FISCAL YEAR UP TO:

(1) THIRTY PERCENT OF THE DOLLAR AMOUNT OF FILM

PRODUCTION TAX CREDITS AVAILABLE TO BE AWARDED IN THE NEXT

SUCCEEDING FISCAL YEAR.

(2) TWENTY PERCENT OF THE DOLLAR AMOUNT OF FILM

PRODUCTION TAX CREDITS AVAILABLE TO BE AWARDED IN THE SECOND

SUCCESSIVE FISCAL YEAR.

(3) TEN PERCENT OF THE DOLLAR AMOUNT OF FILM PRODUCTION

TAX CREDITS AVAILABLE TO BE AWARDED IN THE THIRD SUCCESSIVE

FISCAL YEAR.

* * *

(B) INDIVIDUAL LIMITATIONS.--THE FOLLOWING SHALL APPLY:

(1) EXCEPT AS SET FORTH IN PARAGRAPH (1.1) [OR (1.2)],

(1.2), (1.3) OR (1.4), THE AGGREGATE AMOUNT OF FILM

PRODUCTION TAX CREDITS AWARDED BY THE DEPARTMENT UNDER

SECTION 1712-D(D) TO A TAXPAYER FOR A FILM MAY NOT EXCEED 25%

OF THE QUALIFIED FILM PRODUCTION EXPENSES TO BE INCURRED.

(1.1) IN ADDITION TO THE TAX CREDIT UNDER PARAGRAPH (1),

A TAXPAYER IS ELIGIBLE FOR A CREDIT IN THE AMOUNT OF 5% OF

THE QUALIFIED FILM PRODUCTION EXPENSES INCURRED BY THE

TAXPAYER IF THE TAXPAYER:

(I) FILMS A FEATURE FILM, TELEVISION FILM OR

TELEVISION SERIES, WHICH IS INTENDED AS PROGRAMMING FOR A

NATIONAL AUDIENCE; AND

(II) FILMS IN A QUALIFIED PRODUCTION FACILITY WHICH

20230HB1219PN2089 - 44 -

MEETS THE MINIMUM STAGE FILMING REQUIREMENTS.

(1.2) A QUALIFIED POSTPRODUCTION EXPENSE SHALL QUALIFY

FOR A 30% CREDIT.

(1.3) IN ADDITION TO THE TAX CREDIT UNDER PARAGRAPH (1),

A TAXPAYER IS ELIGIBLE FOR A CREDIT IN THE AMOUNT OF 5% OF

THE QUALIFIED FILM PRODUCTION EXPENSES INCURRED BY THE

TAXPAYER, WHICH IN THE AGGREGATE WOULD QUALIFY FOR A 30%

CREDIT, IF THE TAXPAYER:

(I) FILMS A FEATURE FILM, TELEVISION FILM,

TELEVISION SERIES OR OTHER VISUAL MEDIA, WHICH IS

INTENDED AS PROGRAMMING FOR A NATIONAL AUDIENCE; AND

(II) IS A MINORITY-OWNED BUSINESS OR WOMEN-OWNED

BUSINESS AS THOSE TERMS ARE DEFINED IN 74 PA.C.S. §

303(B) (RELATING TO DIVERSE BUSINESS PARTICIPATION).

(1.4) IN ADDITION TO THE TAX CREDIT UNDER PARAGRAPHS (1)

AND (1.1), A TAXPAYER IS ELIGIBLE FOR A CREDIT IN THE AMOUNT

OF 5% OF THE QUALIFIED FILM PRODUCTION EXPENSES INCURRED BY

THE TAXPAYER, WHICH IN THE AGGREGATE SHALL NOT EXCEED 35% OF

THE QUALIFIED FILM PRODUCTION EXPENSES INCURRED BY THE

TAXPAYER, IF THE TAXPAYER FILMS A FEATURE FILM, TELEVISION

FILM OR TELEVISION SERIES, WHICH IS INTENDED AS PROGRAMMING

FOR A NATIONAL AUDIENCE, IN A QUALIFIED LOCATION IN THIS

COMMONWEALTH.

(2) A TAXPAYER THAT HAS RECEIVED A GRANT UNDER 12

PA.C.S. § 4106 (RELATING TO APPROVAL) SHALL NOT BE ELIGIBLE

FOR A FILM PRODUCTION TAX CREDIT UNDER THIS ACT FOR THE SAME

FILM.

* * *

(E) PENNSYLVANIA FILM PRODUCER RESERVE.--THE DEPARTMENT

SHALL ANNUALLY RESERVE AND ALLOCATE [$5,000,000] 10% OF THE TAX

20230HB1219PN2089 - 45 -

CREDITS AUTHORIZED UNDER THIS SUBARTICLE IN SUPPORT OF PROJECTS

PRODUCED BY A PENNSYLVANIA FILM PRODUCER. A PENNSYLVANIA FILM

PRODUCER SHALL NOT BE LIMITED IN ELIGIBILITY FOR A TAX CREDIT

SOLELY TO THE PENNSYLVANIA FILM PRODUCER RESERVE IN ANY FISCAL

YEAR. THE FOLLOWING APPLY:

(1) NOT MORE THAN 10% OF THE TOTAL AMOUNT OF TAX CREDITS

AUTHORIZED BY THIS SUBSECTION SHALL BE ALLOCATED TO ANY

SINGLE TAX CREDIT APPLICANT.

(2) NOT MORE THAN 50% OF THE TOTAL AMOUNT OF TAX CREDITS

AUTHORIZED BY THIS SUBSECTION SHALL BE ALLOCATED TO FILM

PROJECTS WITH PRODUCTION EXPENSES IN EXCESS OF $500,000.

(3) A FILM PROJECT THAT QUALIFIES UNDER THIS SUBSECTION

NEED ONLY DOCUMENT THAT 60% OF THE FINANCING FOR THE FILM

PROJECT HAS BEEN SECURED PRIOR TO BEING CONSIDERED FOR A TAX

CREDIT UNDER THIS SUBARTICLE, WITH THE REMAINING 40% OF THE

FINANCING TO BE SECURED BY THE FILM PROJECT PRIOR TO THE

PLANNED START DATE OF THE PRINCIPAL PHOTOGRAPHY IN THIS

COMMONWEALTH.

(4) BEFORE AWARDING A TAX CREDIT UNDER THIS SUBARTICLE,

ADDITIONAL CONSIDERATION SHALL BE GIVEN TO THE FOLLOWING:

(I) WHETHER PENNSYLVANIA PRODUCTION EXPENSES OF THE

FILM PROJECT COMPRISE AT LEAST 60% OF THE TOTAL

PRODUCTION EXPENSES.

(II) WHETHER THE TAX CREDIT APPLICANT IS A MINORITY

BUSINESS ENTERPRISE, AS DEFINED IN 18 PA.C.S. § 4107.2(B)

(RELATING TO DECEPTION RELATING TO CERTIFICATION OF

MINORITY BUSINESS ENTERPRISE OR WOMEN'S BUSINESS

ENTERPRISE).

(III) WHETHER THE TAX CREDIT APPLICANT IS A WOMEN'S

BUSINESS ENTERPRISE, AS DEFINED IN 18 PA.C.S. §

20230HB1219PN2089 - 46 -

4107.2(B).

(F) IF THE TOTAL AMOUNT OF TAX CREDITS RESERVED AND

ALLOCATED UNDER SUBSECTION (E) IS NOT FULLY AWARDED [IN] THREE

MONTHS PRIOR TO THE END OF A FISCAL YEAR, THE AMOUNT NOT AWARDED

SHALL BE MADE AVAILABLE FOR USE BY TAXPAYERS WHO ARE NOT

PENNSYLVANIA FILM PRODUCERS.

SECTION 11.2. ARTICLE XVII-L OF THE ACT IS AMENDED BY ADDING

A SUBARTICLE TO READ:

SUBARTICLE G

BIOTECHNOLOGY

SECTION 1799.11-L. DEFINITIONS.

THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS SUBARTICLE

SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE

CONTEXT CLEARLY INDICATES OTHERWISE:

"BIOTECHNOLOGY." THE USE OF BIOLOGY TO DEVELOP NEW PRODUCTS,

METHODS AND ORGANISMS INTENDED TO IMPROVE HUMAN HEALTH AND

SOCIETY.

"PROJECT FACILITY." A FACILITY LOCATED IN THIS COMMONWEALTH

WHICH IS OWNED AND OPERATED BY A QUALIFIED TAXPAYER WHICH

ENGAGES IN BIOTECHNOLOGY RESEARCH AND THE COMMERCIALIZATION OF

APPLIED RESEARCH WITHIN THIS COMMONWEALTH.

"QUALIFIED TAXPAYER." A COMPANY THAT MEETS ALL OF THE

FOLLOWING CRITERIA:

(1) USES BIOTECHNOLOGY IN THIS COMMONWEALTH AT A PROJECT

FACILITY IN THIS COMMONWEALTH THAT HAS BEEN PLACED IN SERVICE

ON OR AFTER THE EFFECTIVE DATE OF THIS SECTION.

(2) MAKES A CAPITAL INVESTMENT OF AT LEAST $500,000,000

IN ORDER TO CONSTRUCT THE PROJECT FACILITY AND PLACE THE

PROJECT FACILITY INTO SERVICE IN THIS COMMONWEALTH.

(3) CREATES A MINIMUM AGGREGATE TOTAL OF 250 NEW JOBS

20230HB1219PN2089 - 47 -

AND PERMANENT JOBS.

(4) MAKES GOOD FAITH EFFORTS TO RECRUIT AND EMPLOY, AND

TO ENCOURAGE ANY CONTRACTOR OR SUBCONTRACTOR TO RECRUIT AND

EMPLOY, WORKERS FROM THE LOCAL LABOR MARKET FOR EMPLOYMENT

DURING THE CONSTRUCTION OF THE PROJECT FACILITY.

(5) DEMONSTRATES THAT THE NEW JOBS CREATED AT THE

PROJECT FACILITY OR FOR WORK COVERED BY SUBARTICLE F ARE PAID

AT LEAST THE PREVAILING MINIMUM WAGE AND BENEFIT RATES FOR

EACH CRAFT OR CLASSIFICATION AS DETERMINED BY THE DEPARTMENT

OF LABOR AND INDUSTRY.

(6) PERFORMS THE CONSTRUCTION WORK TO PLACE THE PROJECT

FACILITY INTO SERVICE IN ACCORDANCE WITH THE ACT OF MARCH 3,

1978 (P.L.6, NO.3), KNOWN AS THE STEEL PRODUCTS PROCUREMENT

ACT.

SECTION 1799.12-L. ELIGIBILITY.

IN ORDER TO BE ELIGIBLE TO RECEIVE A TAX CREDIT, A COMPANY

SHALL DEMONSTRATE THE FOLLOWING:

(1) THE COMPANY MEETS THE REQUIREMENTS OF A QUALIFIED

TAXPAYER.

(2) A CONFIRMATION THAT THE COMPANY HAS FILED ALL

REQUIRED STATE TAX REPORTS AND RETURNS FOR ALL APPLICABLE

TAXABLE YEARS AND PAID ANY BALANCE OF STATE TAX DUE AS

DETERMINED BY ASSESSMENT OR DETERMINATION BY THE DEPARTMENT

AND NOT UNDER TIMELY APPEAL.

SECTION 1799.13-L. APPLICATION AND APPROVAL OF TAX CREDIT.

(A) (RESERVED).

(B) APPLICATION.--

(1) A QUALIFIED TAXPAYER MAY APPLY TO THE DEPARTMENT FOR

A TAX CREDIT UNDER THIS SECTION.

(2) THE APPLICATION MUST BE SUBMITTED TO THE DEPARTMENT

20230HB1219PN2089 - 48 -

BY MARCH 1 FOR THE TAX CREDIT CLAIMED BY THE QUALIFIED

TAXPAYER AT THE PROJECT FACILITY DURING THE PRIOR CALENDAR

YEAR.

(3) THE APPLICATION MUST BE ON THE FORM REQUIRED BY THE

DEPARTMENT, WHICH SHALL INCLUDE ALL OF THE FOLLOWING:

(I) INFORMATION REQUIRED BY THE DEPARTMENT TO VERIFY

THAT THE APPLICANT IS A QUALIFIED TAXPAYER.

(II) ANY OTHER INFORMATION AS THE DEPARTMENT DEEMS

APPROPRIATE.

(1) THE DEPARTMENT SHALL REVIEW THE APPLICATIONS AND

ISSUE AN APPROVAL OR DISAPPROVAL BY MAY 1.

(2) UPON APPROVAL, THE DEPARTMENT SHALL ISSUE A

CERTIFICATE STATING THE AMOUNT OF TAX CREDIT GRANTED FOR

BIOTECHNOLOGY AT THE PROJECT FACILITY IN THE PRIOR CALENDAR

YEAR.

(D) AVAILABILITY OF TAX CREDITS.--

(1) EACH FISCAL YEAR, $15,000,000 IN TAX CREDITS SHALL

BE MADE AVAILABLE TO THE DEPARTMENT IN ACCORDANCE WITH THIS

SUBARTICLE.

(2) THE DEPARTMENT MAY ISSUE UP TO $5,000,000 IN TAX

CREDITS TO EACH QUALIFIED TAXPAYER WHICH MEETS THE

QUALIFICATIONS TO RECEIVE A TAX CREDIT UNDER THIS SUBARTICLE.

(3) AN AMOUNT UNDER PARAGRAPH (1) WHICH REMAINS

UNALLOCATED UNDER PARAGRAPH (2) SHALL BE ISSUED TO THE

QUALIFIED TAXPAYER WHICH NEXT MEETS THE QUALIFICATIONS TO

RECEIVE A TAX CREDIT UNDER THIS SUBARTICLE.

(4) THE TOTAL AGGREGATE AMOUNT OF TAX CREDITS AWARDED TO

A QUALIFIED TAXPAYER UNDER THIS SUBARTICLE MAY NOT EXCEED 25%

OF THE CAPITAL INVESTMENT MADE TO CONSTRUCT A PROJECT

20230HB1219PN2089 - 49 -

FACILITY AND PLACE THE PROJECT FACILITY INTO SERVICE IN THIS

COMMONWEALTH.

SECTION 1799.14-L. USE OF TAX CREDITS.

(A) INITIAL USE.--PRIOR TO SALE OR ASSIGNMENT OF A TAX

CREDIT UNDER SECTION 1799.16-L, A QUALIFIED TAXPAYER MUST FIRST

USE A TAX CREDIT AGAINST THE QUALIFIED TAX LIABILITY INCURRED IN

THE TAXABLE YEAR FOR WHICH THE TAX CREDIT WAS APPROVED.

(B) ELIGIBILITY.--THE TAX CREDIT MAY BE APPLIED AGAINST UP

TO 20% OF A QUALIFIED TAXPAYER'S QUALIFIED TAX LIABILITIES

INCURRED IN THE TAXABLE YEAR FOR WHICH THE TAX CREDIT WAS

APPROVED.

CREDIT UNDER THIS SUBARTICLE SHALL BE INELIGIBLE FOR ANY OTHER

TAX CREDIT PROVIDED UNDER THIS ACT OR A TAX BENEFIT AS DEFINED

IN SECTION 1701-A.1.

SECTION 1799.15-L. CARRYOVER, CARRYBACK AND REFUND.

A TAX CREDIT CANNOT BE CARRIED BACK, CARRIED FORWARD OR BE

USED TO OBTAIN A REFUND.

SECTION 1799.16-L. SALE OR ASSIGNMENT.

(A) AUTHORIZATION.--IF THE QUALIFIED TAXPAYER HOLDS A TAX

CREDIT THROUGH THE END OF THE CALENDAR YEAR IN WHICH THE TAX

CREDIT WAS GRANTED, THE QUALIFIED TAXPAYER MAY SELL OR ASSIGN A

TAX CREDIT, IN WHOLE OR IN PART, PROVIDED THE SALE IS EFFECTIVE

BY THE CLOSE OF THE FOLLOWING CALENDAR YEAR.

(B) APPLICATION.--

(1) TO SELL OR ASSIGN A TAX CREDIT, A QUALIFIED TAXPAYER

MUST FILE AN APPLICATION FOR THE SALE OR ASSIGNMENT OF THE

TAX CREDIT WITH THE DEPARTMENT. THE APPLICATION MUST BE ON A

FORM REQUIRED BY THE DEPARTMENT.

(2) IN ORDER TO APPROVE AN APPLICATION, THE DEPARTMENT

20230HB1219PN2089 - 50 -

SHALL RECEIVE ALL OF THE FOLLOWING:

(I) A FINDING FROM THE DEPARTMENT THAT THE APPLICANT

HAS:

(A) FILED ALL REQUIRED STATE TAX REPORTS AND

RETURNS FOR ALL APPLICABLE TAXABLE YEARS; AND

(B) PAID ANY BALANCE OF STATE TAX DUE AS

DETERMINED BY ASSESSMENT OR DETERMINATION BY THE

DEPARTMENT AND NOT UNDER TIMELY APPEAL.

(II) FOR A SALE OR ASSIGNMENT TO A COMPANY THAT IS

NOT AN UPSTREAM COMPANY OR DOWNSTREAM COMPANY, A

CERTIFICATION FROM THE QUALIFIED TAXPAYER THAT THE

QUALIFIED TAXPAYER HAS OFFERED TO SELL OR ASSIGN THE TAX

CREDIT:

(A) EXCLUSIVELY TO A DOWNSTREAM COMPANY FOR A

PERIOD OF 30 DAYS FOLLOWING APPROVAL OF THE TAX

CREDIT UNDER SECTION 1799.13-L(C); AND

(B) TO AN UPSTREAM COMPANY OR DOWNSTREAM COMPANY

FOR A PERIOD OF 30 DAYS FOLLOWING EXPIRATION OF THE

PERIOD UNDER CLAUSE (A).

TAXPAYER MAY SELL OR ASSIGN, IN WHOLE OR IN PART, A TAX CREDIT.

SECTION 1799.17-L. PURCHASERS AND ASSIGNEES.

(A) TIME.--THE PURCHASER OR ASSIGNEE UNDER SECTION 1799.16-L

MUST CLAIM THE TAX CREDIT IN THE CALENDAR YEAR IN WHICH THE

PURCHASE OR ASSIGNMENT IS MADE.

(B) AMOUNT.--THE AMOUNT OF THE TAX CREDIT THAT A PURCHASER

OR ASSIGNEE UNDER SECTION 1799.16-L MAY USE AGAINST ANY ONE

QUALIFIED TAX LIABILITY MAY NOT EXCEED 50% OF ANY OF THE

QUALIFIED TAX LIABILITIES OF THE PURCHASER OR ASSIGNEE FOR THE

TAXABLE YEAR.

20230HB1219PN2089 - 51 -

(1) A PURCHASER UNDER SECTION 1799.16-L MAY NOT SELL OR

ASSIGN THE PURCHASED TAX CREDIT.

(2) AN ASSIGNEE UNDER SECTION 1799.16-L MAY NOT SELL OR

ASSIGN THE ASSIGNED TAX CREDIT.

(D) NOTICE.--THE PURCHASER OR ASSIGNEE UNDER SECTION

1799.16-L SHALL NOTIFY THE DEPARTMENT OF THE SELLER OR ASSIGNOR

OF THE TAX CREDIT IN COMPLIANCE WITH PROCEDURES SPECIFIED BY THE

DEPARTMENT.

SECTION 1799.18-L. PASS-THROUGH ENTITY.

(A) ELECTION.--IF A PASS-THROUGH ENTITY HAS AN UNUSED TAX

CREDIT, THE PASS-THROUGH ENTITY MAY ELECT, IN WRITING, ACCORDING

TO PROCEDURES ESTABLISHED BY THE DEPARTMENT, TO TRANSFER ALL OR

A PORTION OF THE TAX CREDIT TO SHAREHOLDERS, MEMBERS OR PARTNERS

IN PROPORTION TO THE SHARE OF THE ENTITY'S DISTRIBUTIVE INCOME

TO WHICH THE SHAREHOLDERS, MEMBERS OR PARTNERS ARE ENTITLED.

(B) LIMITATION.--THE SAME UNUSED TAX CREDIT UNDER SUBSECTION

(A) MAY NOT BE CLAIMED BY :

(1) THE PASS-THROUGH ENTITY; AND

(2) A SHAREHOLDER, MEMBER OR PARTNER OF THE PASS-THROUGH

ENTITY.

UNDER SUBSECTION (A) MAY USE AGAINST ANY ONE QUALIFIED TAX

LIABILITY MAY NOT EXCEED 20% OF ANY QUALIFIED TAX LIABILITIES

FOR THE TAXABLE YEAR.

(D) TIME.--A TRANSFEREE UNDER SUBSECTION (A) MUST CLAIM THE

TAX CREDIT IN THE CALENDAR YEAR IN WHICH THE TRANSFER IS MADE.

(E) SALE AND ASSIGNMENT.--A TRANSFEREE UNDER SUBSECTION (A)

MAY NOT SELL OR ASSIGN THE TAX CREDIT.

SECTION 1799.19-L. (RESERVED).

20230HB1219PN2089 - 52 -

SECTION 1799.20-L. GUIDELINES AND REGULATIONS.

THE DEPARTMENT SHALL DEVELOP WRITTEN GUIDELINES FOR THE

IMPLEMENTATION OF THIS SUBARTICLE. THE GUIDELINES SHALL BE IN

EFFECT UNTIL THE DEPARTMENT PROMULGATES REGULATIONS FOR THE

IMPLEMENTATION OF THE PROVISIONS OF THIS SUBARTICLE.

SECTION 1799.21-L. REPORT TO GENERAL ASSEMBLY.

(A) REPORT.--

(1) NO LATER THAN THE YEAR AFTER WHICH TAX CREDITS ARE

FIRST AWARDED UNDER THIS SUBARTICLE, AND EACH OCTOBER 1

THEREAFTER, THE DEPARTMENT SHALL SUBMIT A REPORT TO THE

GENERAL ASSEMBLY SUMMARIZING THE EFFECTIVENESS OF THE TAX

CREDIT. THE REPORT SHALL INCLUDE THE NAMES OF ALL QUALIFIED

TAXPAYERS UTILIZING THE TAX CREDIT AS OF THE DATE OF THE

REPORT AND THE AMOUNT OF TAX CREDITS APPROVED FOR, UTILIZED

BY OR SOLD OR ASSIGNED BY EACH QUALIFIED TAXPAYER. THE REPORT

SHALL BE SUBMITTED TO THE FOLLOWING:

(I) THE CHAIR AND MINORITY CHAIR OF THE HEALTH AND

HUMAN SERVICES COMMITTEE OF THE SENATE.

(II) THE CHAIR AND MINORITY CHAIR OF THE HEALTH

COMMITTEE OF THE HOUSE OF REPRESENTATIVES.

(III) THE CHAIR AND MINORITY CHAIR OF THE FINANCE

COMMITTEE OF THE SENATE.

(IV) THE CHAIR AND MINORITY CHAIR OF THE FINANCE

COMMITTEE OF THE HOUSE OF REPRESENTATIVES.

(2) IN ADDITION TO THE INFORMATION REQUIRED UNDER

PARAGRAPH (1), THE REPORT SHALL INCLUDE THE FOLLOWING

INFORMATION IN A MANNER THAT IS SEPARATED BY GEOGRAPHIC

LOCATION WITHIN THIS COMMONWEALTH:

(I) THE AMOUNT OF TAX CREDITS CLAIMED BY QUALIFIED

TAXPAYERS DURING THE FISCAL YEAR.

20230HB1219PN2089 - 53 -

(II) THE TOTAL NUMBER OF NEW JOBS AND PERMANENT JOBS

CREATED BY QUALIFIED TAXPAYERS DURING THE FISCAL YEAR,

INCLUDING THE DURATION OF THE JOBS.

(B) PUBLIC INFORMATION.--NOTWITHSTANDING ANY LAW PROVIDING

FOR THE CONFIDENTIALITY OF TAX RECORDS, THE INFORMATION IN THE

REPORT UNDER SUBSECTION (A) SHALL BE PUBLIC INFORMATION, AND ALL

REPORT INFORMATION SHALL BE POSTED ON THE DEPARTMENT'S PUBLICLY

ACCESSIBLE INTERNET WEBSITE.

SECTION 1799.22-L. APPLICABILITY.

(A) DURATION.--THE TAX CREDIT UNDER THIS SUBARTICLE SHALL

APPLY TO THE USE OF BIOTECHNOLOGY FOR A PERIOD OF EIGHT YEARS

FROM THE DATE THE FIRST PROJECT FACILITY IS PLACED INTO SERVICE.

(B) LIMITATION.--THE TOTAL AGGREGATE AMOUNT OF TAX CREDITS

AWARDED BY THE DEPARTMENT UNDER THIS SUBARTICLE MAY NOT EXCEED

$120,000,000.

SECTION 12. SECTIONS 1904-A(C) AND 1905-A(A) OF THE ACT ARE

AMENDED TO READ:

SECTION 1904-A. TAX CREDIT.--* * *

APPROVED UNDER THIS ACT SHALL NOT EXCEED [THIRTY-SIX MILLION

DOLLARS ($36,000,000)] FIFTY-FOUR MILLION DOLLARS ($54,000,000)

OF TAX CREDIT IN ANY FISCAL YEAR.

* * *

SECTION 1905-A. GRANT OF TAX CREDIT.--(A) THE DEPARTMENT OF

REVENUE SHALL GRANT A TAX CREDIT AGAINST ANY TAX DUE UNDER

ARTICLE III, IV, VI, VII, VIII, IX OR XV OF THIS ACT, OR ANY TAX

SUBSTITUTED IN LIEU THEREOF IN AN AMOUNT WHICH SHALL NOT EXCEED

[FIFTY-FIVE] SIXTY-FIVE PER CENT OF THE TOTAL AMOUNT CONTRIBUTED

DURING THE TAXABLE YEAR BY A BUSINESS FIRM OR TWENTY-FIVE PER

CENT OF QUALIFIED INVESTMENTS BY A PRIVATE COMPANY IN PROGRAMS

20230HB1219PN2089 - 54 -

APPROVED PURSUANT TO SECTION 1904-A OF THIS ACT: PROVIDED, THAT

A TAX CREDIT OF UP TO [SEVENTY-FIVE] NINETY PER CENT OF THE

TOTAL AMOUNT CONTRIBUTED DURING THE TAXABLE YEAR BY A BUSINESS

FIRM OR UP TO THIRTY-FIVE PER CENT OF THE AMOUNT OF QUALIFIED

INVESTMENTS BY A PRIVATE COMPANY MAY BE ALLOWED FOR INVESTMENT

IN PROGRAMS WHERE ACTIVITIES FALL WITHIN THE SCOPE OF SPECIAL

PROGRAM PRIORITIES AS DEFINED WITH THE APPROVAL OF THE GOVERNOR

IN REGULATIONS PROMULGATED BY THE SECRETARY, AND PROVIDED

FURTHER, THAT A TAX CREDIT OF UP TO [SEVENTY-FIVE] NINETY PER

CENT OF THE TOTAL AMOUNT CONTRIBUTED DURING THE TAXABLE YEAR BY

A BUSINESS FIRM IN COMPREHENSIVE SERVICE PROJECTS WITH FIVE-YEAR

COMMITMENTS AND UP TO [EIGHTY] NINETY-FIVE PER CENT OF THE TOTAL

AMOUNT CONTRIBUTED DURING THE TAXABLE YEAR BY A BUSINESS FIRM IN

COMPREHENSIVE SERVICE PROJECTS WITH SIX-YEAR OR LONGER

COMMITMENTS SHALL BE GRANTED, AND PROVIDED FURTHER, THAT A TAX

CREDIT OF UP TO [SEVENTY-FIVE] NINETY PER CENT OF THE TOTAL

AMOUNT CONTRIBUTED DURING THE TAXABLE YEAR BY A BUSINESS FIRM IN

VETERANS' HOUSING ASSISTANCE APPROVED UNDER SECTION 1904-A(B.3)

SHALL BE GRANTED. SUCH CREDIT SHALL NOT EXCEED [FIVE HUNDRED

THOUSAND DOLLARS ($500,000)] ONE MILLION DOLLARS ($1,000,000)

ANNUALLY FOR CONTRIBUTIONS OR INVESTMENTS TO FEWER THAN FOUR

PROJECTS OR [ONE MILLION TWO HUNDRED FIFTY THOUSAND DOLLARS

($1,250,000)] TWO MILLION FIVE HUNDRED THOUSAND DOLLARS

($2,500,000) ANNUALLY FOR CONTRIBUTIONS OR INVESTMENTS TO FOUR

OR MORE PROJECTS. NO TAX CREDIT SHALL BE GRANTED TO ANY BANK,

BANK AND TRUST COMPANY, INSURANCE COMPANY, TRUST COMPANY,

NATIONAL BANK, SAVINGS ASSOCIATION, MUTUAL SAVINGS BANK OR

BUILDING AND LOAN ASSOCIATION FOR ACTIVITIES THAT ARE A PART OF

ITS NORMAL COURSE OF BUSINESS. ANY TAX CREDIT NOT USED IN THE

PERIOD THE CONTRIBUTION OR INVESTMENT WAS MADE MAY BE CARRIED

20230HB1219PN2089 - 55 -

OVER FOR THE NEXT FIVE SUCCEEDING CALENDAR OR FISCAL YEARS UNTIL

THE FULL CREDIT HAS BEEN ALLOWED. A BUSINESS FIRM SHALL NOT BE

ENTITLED TO CARRY BACK OR OBTAIN A REFUND OF AN UNUSED TAX

CREDIT. THE TOTAL AMOUNT OF ALL TAX CREDITS ALLOWED PURSUANT TO

THIS ACT SHALL NOT EXCEED [THIRTY-SIX MILLION DOLLARS

($36,000,000)] FIFTY-FOUR MILLION DOLLARS ($54,000,000) IN ANY

ONE FISCAL YEAR. OF THAT AMOUNT, TWO MILLION DOLLARS

($2,000,000) SHALL BE ALLOCATED EXCLUSIVELY FOR PASS-THROUGH

ENTITIES. HOWEVER, IF THE TOTAL AMOUNTS ALLOCATED TO EITHER THE

GROUP OF APPLICANTS, EXCLUSIVE OF PASS-THROUGH ENTITIES, OR THE

GROUP OF PASS-THROUGH ENTITY APPLICANTS IS NOT APPROVED IN ANY

FISCAL YEAR, THE UNUSED PORTION SHALL BECOME AVAILABLE FOR USE

BY THE OTHER GROUP OF QUALIFYING TAXPAYERS.

* * *

SECTION 12.1. THE ACT IS AMENDED BY ADDING AN ARTICLE TO

READ:

ARTICLE XIX-B.1

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONES

SECTION 1901-B.1. SCOPE OF ARTICLE.

THIS ARTICLE RELATES TO EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONES.

SECTION 1902-B.1. 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:

"AFFORDABLE HOUSING." AS FOLLOWS:

(1) HOUSING IN WHICH THE OCCUPANT IS PAYING NO MORE THAN

30% OF GROSS INCOME FOR HOUSING COSTS, INCLUDING UTILITIES.

(2) AFFORDABLE HOUSING UNITS MUST COMPRISE AT LEAST 30%

OF THE UNITS IN AN AFFORDABLE HOUSING BUILDING.

20230HB1219PN2089 - 56 -

"BONDS." INCLUDES NOTES, INSTRUMENTS, REFUNDING NOTES AND

BONDS AND OTHER EVIDENCES OF INDEBTEDNESS OR OBLIGATIONS.

"CAPITAL FACILITIES DEBT ENABLING ACT." THE ACT OF FEBRUARY

9, 1999 (P.L.1, NO.1), KNOWN AS THE CAPITAL FACILITIES DEBT

ENABLING ACT.

"CITY." A CITY WITH A POPULATION OF BETWEEN 94,000 AND

96,000, BASED ON THE 2020 FEDERAL DECENNIAL CENSUS, LOCATED IN A

COUNTY OF THE THIRD CLASS WHICH IS NOT A HOME RULE COUNTY.

"CONTRACTING AUTHORITY." AN AUTHORITY CREATED UNDER 53

PA.C.S. CH. 56 (RELATING TO MUNICIPAL AUTHORITIES) FOR THE

PURPOSE OF DESIGNATING AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE

AND CONSTRUCTING A FACILITY OR OTHER AUTHORITY CREATED UNDER THE

LAWS OF THIS COMMONWEALTH WHICH IS ELIGIBLE TO APPLY FOR AND

RECEIVE REDEVELOPMENT ASSISTANCE CAPITAL GRANTS UNDER CHAPTER 3

OF THE CAPITAL FACILITIES DEBT ENABLING ACT.

"DEPARTMENT." THE DEPARTMENT OF REVENUE OF THE COMMONWEALTH.

"EARNED INCOME TAX." A TAX OR PORTION OF A TAX IMPOSED ON

EARNED INCOME WITHIN AN EXPANDED NEIGHBORHOOD IMPROVEMENT 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.

"EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE." AN EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE DESIGNATED BY THE CONTRACTING

AUTHORITY FOR THE PURPOSES OF AN EXPANDED NEIGHBORHOOD

IMPROVEMENT AND DEVELOPMENT WITHIN A CITY.

"FACILITY." A STRUCTURE OR COMPLEX OF STRUCTURES TO BE USED

FOR RESIDENTIAL, AFFORDABLE HOUSING, COMMERCIAL, SPORTS

EXHIBITION, HOSPITALITY, CONFERENCE, RETAIL, COMMUNITY, OFFICE,

RECREATIONAL OR MIXED-USE PURPOSES.

20230HB1219PN2089 - 57 -

◄

"FUND." THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE FUND

ESTABLISHED UNDER SECTION 1904-B.1.

"MASTER LIST." A LIST MAINTAINED BY THE CONTRACTING

AUTHORITY THAT INCLUDES:

(1) THE LEGAL BUSINESS NAMES, PRINCIPAL BUSINESS

ADDRESSES WITHIN AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE

AND PARCEL NUMBERS OF ALL QUALIFIED BUSINESSES WHICH ARE

REQUIRED TO FILE REPORTS FOR THE CALENDAR YEAR UNDER SECTION

1904-B.1(B)(1).

(2) THE NAME, TELEPHONE NUMBER AND EMAIL ADDRESS OF THE

PERSON EMPLOYED BY THE QUALIFIED BUSINESS WHO IS PRIMARILY

RESPONSIBLE FOR COMPLETING REPORTS FOR THE QUALIFIED BUSINESS

REQUIRED UNDER SECTION 1904-B.1(B).

"OPERATING ORGANIZATION." AN ENTITY THAT CONTRACTS DIRECTLY

WITH THE CONTRACTING AUTHORITY TO LEASE OR OPERATE A FACILITY.

"PROFESSIONAL SPORTS ORGANIZATION." A SOLE PROPRIETORSHIP,

CORPORATION, LIMITED LIABILITY COMPANY, PARTNERSHIP OR

ASSOCIATION THAT MEETS ALL OF THE FOLLOWING:

(1) OWNS A PROFESSIONAL SPORTS FRANCHISE.

(2) CONDUCTS PROFESSIONAL ATHLETIC EVENTS OF THE SPORTS

FRANCHISE AT A FACILITY.

"QUALIFIED BUSINESS." AN ENTITY AUTHORIZED TO CONDUCT

BUSINESS IN THIS COMMONWEALTH WHICH IS LOCATED OR PARTIALLY

LOCATED WITHIN AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE AND IS

ENGAGED IN THE ACTIVE CONDUCT OF A TRADE OR BUSINESS FOR THE

TAXABLE YEAR. AN AGENT, BROKER OR REPRESENTATIVE OF A BUSINESS

SHALL NOT BE CONSIDERED TO BE IN THE ACTIVE CONDUCT OF TRADE OR

BUSINESS FOR THE BUSINESS.

SECTION 1903-B.1. FACILITY.

A CONTRACTING AUTHORITY MAY:

20230HB1219PN2089 - 58 -

(1) DESIGNATE AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE

OF NOT GREATER THAN 130 ACRES IN WHICH A FACILITY MAY BE

CONSTRUCTED.

(2) BORROW MONEY FOR THE PURPOSE OF:

(I) IMPROVEMENT AND DEVELOPMENT WITHIN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE.

(II) CONSTRUCTION OF A FACILITY WITHIN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE.

SECTION 1904-B.1. EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE FUND

AND ACCOUNTS.

(A) FUND AND ACCOUNTS.--

(1) WITHIN 10 DAYS AFTER A CONTRACTING AUTHORITY MAKES A

DESIGNATION OF AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE, THE

CONTRACTING AUTHORITY SHALL NOTIFY THE STATE TREASURER OF THE

DESIGNATION.

(2) UPON THE NOTICE UNDER PARAGRAPH (1), THE STATE

TREASURER SHALL ESTABLISH A FUND TO BE KNOWN AS THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE FUND, WHICH SHALL CONTAIN AN

ACCOUNT FOR EACH CONTRACTING AUTHORITY. INTEREST INCOME

DERIVED FROM INVESTMENT OF THE MONEY IN THE FUND SHALL BE

CREDITED BY THE TREASURY DEPARTMENT TO THE FUND FOR EACH

ACCOUNT OF THE CONTRACTING AUTHORITY.

(B) CERTIFICATION.--

(1) WITHIN 31 DAYS OF THE END OF EACH CALENDAR YEAR,

EACH QUALIFIED BUSINESS SHALL FILE A REPORT WITH THE

DEPARTMENT WHICH COMPLIES WITH ALL OF THE FOLLOWING:

(I) STATES EACH STATE TAX, CALCULATED IN ACCORDANCE

WITH SUBSECTION (E), WHICH WAS PAID BY THE QUALIFIED

BUSINESS IN THE PRIOR CALENDAR YEAR.

(II) LISTS EACH STATE TAX REFUND WHICH COMPLIES WITH

20230HB1219PN2089 - 59 -

ALL OF THE FOLLOWING:

(A) THE REFUND IS FOR A TAX:

(I) SPECIFIED IN SUBSECTION (E); AND

(II) CERTIFIED AS PAID UNDER SUBSECTION (E).

(B) THE REFUND WAS RECEIVED IN THE PRIOR

CALENDAR YEAR BY THE QUALIFIED BUSINESS.

(III) IS IN A FORM AND MANNER REQUIRED BY THE

DEPARTMENT.

(2) IN ADDITION TO ANY PENALTIES IMPOSED UNDER THIS ACT

FOR FAILURE TO TIMELY PAY STATE TAXES, THE FOLLOWING APPLY:

(I) FAILURE TO FILE A TIMELY AND COMPLETE REPORT

UNDER PARAGRAPH (1) SHALL RESULT IN THE IMPOSITION OF A

PENALTY OF 10% OF ALL STATE TAXES, CALCULATED IN

ACCORDANCE WITH SUBSECTION (E), WHICH WERE PAYABLE BY THE

QUALIFIED BUSINESS IN THE PRIOR CALENDAR YEAR. THE

FOLLOWING APPLY:

(A) THE PENALTY IMPOSED SHALL NOT BE LESS THAN

$1,000.

(B) WHEN THE PENALTY IS RECEIVED, THE MONEY

SHALL BE TRANSFERRED FROM THE GENERAL FUND TO THE

ACCOUNT OF THE CONTRACTING AUTHORITY THAT DESIGNATED

THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE IN WHICH

THE QUALIFYING BUSINESS IS LOCATED.

UNDER PARAGRAPH (4) SHALL RESULT IN THE IMPOSITION OF

A PENALTY OF 10% OF ALL LOCAL TAXES, CALCULATED IN

ACCORDANCE WITH SUBSECTION (E) BY A CONTRACTING

AUTHORITY WHICH WERE PAYABLE BY THE QUALIFIED

BUSINESS IN THE PRIOR CALENDAR YEAR. THE PENALTY

IMPOSED UNDER THIS CLAUSE SHALL NOT BE LESS THAN

20230HB1219PN2089 - 60 -

$250.

(II) FAILURE TO REPORT A QUALIFIED BUSINESS

OPERATING IN THE FACILITY TO THE CONTRACTING AUTHORITY BY

AN OPERATING ORGANIZATION IN ACCORDANCE WITH SUBSECTION

(D)(2) SHALL RESULT IN THE IMPOSITION OF A PENALTY BY THE

CONTRACTING AUTHORITY UPON THE OPERATING ORGANIZATION, OF

100% OF THE TAXES WHICH WOULD BE CERTIFIED UNDER

SUBSECTION (E) FOR EACH QUALIFIED BUSINESS WHICH IS NOT

REPORTED TO THE CONTRACTING AUTHORITY OR $1,000,

WHICHEVER IS GREATER. THE FOLLOWING APPLY:

(A) THE CONTRACTING AUTHORITY MAY NOT WAIVE OR

ABATE ANY PENALTIES IMPOSED UNDER THIS SUBPARAGRAPH.

(B) WHEN THE PENALTY IS RECEIVED, THE MONEY

SHALL BE TRANSFERRED FROM THE GENERAL FUND TO THE

ACCOUNT OF THE CONTRACTING AUTHORITY THAT DESIGNATED

THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE IN WHICH

THE QUALIFYING BUSINESS IS LOCATED.

(III) FAILURE TO FILE A TIMELY AND COMPLETE REPORT

UNDER PARAGRAPH (1) BY A QUALIFIED BUSINESS ENGAGED IN

THE ACTIVE CONDUCT OF A TRADE OR BUSINESS DURING THE

CALENDAR YEAR IN THE FACILITY SHALL RESULT IN THE

IMPOSITION OF A PENALTY BY THE CONTRACTING AUTHORITY UPON

THE OPERATING ORGANIZATION EQUAL TO 100% OF THE TAXES

PAID WHICH WOULD BE CERTIFIED UNDER SUBSECTION (E) FOR

EACH QUALIFIED BUSINESS WHICH FAILS TO FILE A TIMELY AND

COMPLETE REPORT. THE FOLLOWING APPLY:

(A) THE PENALTY IMPOSED SHALL NOT BE LESS THAN

$1,000.

(B) IF THE QUALIFIED BUSINESS IS PROPERLY

INCLUDED ON THE MASTER LIST PROVIDED UNDER SUBSECTION

20230HB1219PN2089 - 61 -

(D), THE CONTRACTING AUTHORITY MAY WAIVE OR ABATE

PENALTIES IMPOSED UNDER THIS SUBPARAGRAPH EQUAL TO

THE TOTAL TAXES PAID BY THE QUALIFIED BUSINESS WHICH

ARE CERTIFIED UNDER SUBSECTION (E).

SHALL BE DEPOSITED INTO THE ACCOUNT OF THE

CONTRACTING AUTHORITY THAT DESIGNATED THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE IN WHICH THE QUALIFYING

BUSINESS IS LOCATED.

(3) EXCEPT AS OTHERWISE PROVIDED UNDER PARAGRAPH (2)(II)

AND (III), A PENALTY IMPOSED UNDER THIS SUBSECTION SHALL BE

IMPOSED, ASSESSED AND COLLECTED BY THE DEPARTMENT UNDER THE

PROVISIONS FOR IMPOSING, ASSESSING AND COLLECTING PENALTIES

UNDER ARTICLE II. WHEN THE PENALTY IS RECEIVED, THE MONEY

SHALL BE TRANSFERRED FROM THE GENERAL FUND TO THE ACCOUNT OF

THE CONTRACTING AUTHORITY THAT DESIGNATED THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE IN WHICH THE QUALIFIED BUSINESS

IS LOCATED.

(4) WITHIN 31 DAYS OF THE END OF EACH CALENDAR YEAR,

EACH QUALIFIED BUSINESS SHALL FILE A REPORT WITH THE LOCAL

TAXING AUTHORITY REPORTING ALL LOCAL TAXES, CALCULATED IN

ACCORDANCE WITH SUBSECTION (E), WHICH WERE PAID BY THE

QUALIFIED BUSINESS IN THE PRIOR CALENDAR YEAR. THE FOLLOWING

APPLY:

(I) THE REPORT FROM EACH QUALIFIED BUSINESS SHALL

ALSO LIST ANY LOCAL TAX REFUNDS OF TAXES SPECIFIED IN

SUBSECTION (E) RECEIVED IN THE PRIOR CALENDAR YEAR BY THE

QUALIFIED BUSINESS AND ANY REFUNDS RELATED TO THE LOCAL

TAXES AS CALCULATED IN ACCORDANCE WITH SUBSECTION (E).

(II) THE REPORT SHALL BE IN A FORM AND MANNER

20230HB1219PN2089 - 62 -

REQUIRED BY THE DEPARTMENT.

(1) SUBJECT TO PARAGRAPHS (3) AND (4), WITHIN 15 DAYS OF

THE RECEIPT OF A PENALTY OR REPORT FROM THE QUALIFIED

BUSINESS, THE STATE TREASURER SHALL:

(I) DETERMINE THE AMOUNT OF MONEY IN THE FUND WHICH

IS ATTRIBUTABLE TO EACH EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONE.

(II) TRANSFER THE AMOUNT OF MONEY IN THE FUND FOR

EACH CONTRACTING AUTHORITY FOR WHICH MONEY WAS DEPOSITED.

(2) AN ENTITY COLLECTING A LOCAL TAX THAT IS IN

POSSESSION OF MONEY ATTRIBUTABLE TO A LOCAL TAX NOT INCLUDED

IN THE AMOUNT TO BE CALCULATED AND CERTIFIED UNDER SUBSECTION

(E) SHALL PROMPTLY REMIT THAT MONEY TO THE LOCAL TAXING

AUTHORITY ENTITLED TO RECEIVE THE MONEY.

(3) TRANSFER AND REPAYMENT IS SUBJECT TO THE FOLLOWING:

(I) BEFORE MAKING THE TRANSFER UNDER PARAGRAPH (1),

THE STATE TREASURER SHALL:

(A) DETERMINE THE AMOUNT OF MONEY DEPOSITED INTO

THE FUND WHICH WAS ATTRIBUTABLE TO EARNED INCOME

TAXES THAT A CONTRACTING AUTHORITY IS NOT ENTITLED TO

RECEIVE UNDER SUBSECTION (E).

(B) DEDUCT THE AMOUNT OF MONEY DETERMINED UNDER

CLAUSE (A) FROM THE MONEY TO BE TRANSFERRED UNDER

PARAGRAPH (1).

(II) IF ANY AMOUNT OF THE MONEY UNDER SUBPARAGRAPH

(I)(A) HAS ALREADY BEEN TRANSFERRED TO A CONTRACTING

AUTHORITY, THE STATE TREASURER SHALL TAKE ACTION AS

NECESSARY TO RECOVER THE MONEY FROM THE CONTRACTING

AUTHORITY, INCLUDING BY WAY OF SETOFF FROM MONEY TO BE

20230HB1219PN2089 - 63 -

PAID TO THE CONTRACTING AUTHORITY UNDER PARAGRAPH (1).

THE CONTRACTING AUTHORITY SHALL COMPLY WITH A DEMAND MADE

BY THE STATE TREASURER FOR THE REPAYMENT OF MONEY UNDER

THIS PARAGRAPH.

(4) AS TO THE MONEY DEDUCTED OR RECOVERED UNDER

PARAGRAPH (3), THE STATE TREASURER SHALL:

(I) IDENTIFY THE LOCAL TAXING AUTHORITIES THAT WERE

ENTITLED TO RECEIVE THE MONEY WHICH WAS DEPOSITED INTO

THE FUND.

(II) DETERMINE THE AMOUNT TO WHICH EACH LOCAL TAXING

AUTHORITY WAS ENTITLED.

(III) REMIT THE AMOUNT UNDER SUBPARAGRAPH (II) TO

THE PROPER LOCAL TAXING AUTHORITY.

(D) MASTER LIST.--

(1) EXCEPT AS PROVIDED UNDER PARAGRAPH (2), WITHIN FIVE

DAYS OF THE END OF EACH MONTH, THE FOLLOWING SHALL BE

PROVIDED TO THE CONTRACTING AUTHORITY BY OR ON BEHALF OF THE

QUALIFIED BUSINESS FOR PURPOSES OF INCLUSION ON THE MASTER

LIST:

(I) THE LEGAL BUSINESS NAMES, BUSINESS ADDRESSES

WITHIN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE AND

PARCEL NUMBERS OF ALL QUALIFIED BUSINESSES ENGAGED IN THE

ACTIVE CONDUCT OF A TRADE OR BUSINESS DURING THE PREVIOUS

MONTH.

(II) THE NAME, TELEPHONE NUMBER AND EMAIL ADDRESS OF

THE PERSON EMPLOYED BY THE QUALIFIED BUSINESS WHO IS

PRIMARILY RESPONSIBLE FOR COMPLETING REPORTS FOR THE

QUALIFIED BUSINESS REQUIRED UNDER SUBSECTION (B).

(2) FOR PURPOSES OF INCLUSION ON THE MASTER LIST, WITHIN

FIVE DAYS OF THE END OF EACH MONTH DURING A CALENDAR YEAR, AN

20230HB1219PN2089 - 64 -

OPERATING ORGANIZATION SHALL PROVIDE TO THE CONTRACTING

AUTHORITY THE LEGAL BUSINESS NAMES AND BUSINESS ADDRESSES

WITHIN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE OF ALL

QUALIFIED BUSINESSES ENGAGED IN THE ACTIVE CONDUCT OF A TRADE

OR BUSINESS IN THE FACILITY DURING THE PREVIOUS MONTH ALONG

WITH THE NAME, TELEPHONE NUMBER AND EMAIL ADDRESS OF THE

INDIVIDUAL EMPLOYED BY THE QUALIFIED BUSINESS WHO IS

PRIMARILY RESPONSIBLE FOR COMPLETING THE REPORTS FOR THE

QUALIFIED BUSINESS REQUIRED UNDER SUBSECTION (B).

(3) WITHIN 10 DAYS OF THE END OF EACH CALENDAR YEAR, THE

CONTRACTING AUTHORITY SHALL PROVIDE TO THE DEPARTMENT THE

MASTER LIST. THE DEPARTMENT MAY NOT CERTIFY ANY TAXES PAID

DIRECTLY OR INDIRECTLY BY A QUALIFIED BUSINESS AS PROVIDED

UNDER SUBSECTION (E) DURING THE PRIOR CALENDAR YEAR WHEN THE

QUALIFIED BUSINESS IS NOT INCLUDED ON THE MASTER LIST.

(4) A CONTRACTING AUTHORITY SHALL IMPOSE PENALTIES FOR

FAILURE TO COMPLY WITH THIS SECTION.

(E) CALCULATION.--

(1) WITHIN 60 DAYS OF THE END OF EACH CALENDAR YEAR, THE

DEPARTMENT SHALL CERTIFY SEPARATELY FOR EACH EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE THE AMOUNTS OF STATE TAXES

PAID, LESS ANY STATE TAX REFUNDS RECEIVED, BY THE QUALIFIED

BUSINESSES FILING REPORTS UNDER SUBSECTION (B)(1) TO THE

OFFICE OF THE BUDGET.

(2) BEGINNING IN THE FIRST FULL CALENDAR YEAR FOLLOWING

THE DESIGNATION OF AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE

AND IN EACH CALENDAR YEAR THEREAFTER, BY NOVEMBER 1, THE

DEPARTMENT SHALL CALCULATE, IN ACCORDANCE WITH THIS

SUBSECTION, AMOUNTS OF STATE TAXES ACTUALLY RECEIVED BY THE

COMMONWEALTH FROM EACH QUALIFIED BUSINESS THAT FILED A REPORT

20230HB1219PN2089 - 65 -

UNDER SUBSECTION (B)(1) IN THE PRIOR CALENDAR YEAR, AND THE

DEPARTMENT SHALL CERTIFY THE AMOUNTS RECEIVED TO THE OFFICE

OF THE BUDGET.

(3) THE DEPARTMENT SHALL INCLUDE REPORTS FILED FIVE

MONTHS AFTER THE DUE DATE UNDER SUBSECTION (B)(1) IN THE

NOVEMBER 1 CERTIFICATION.

(4) AN ENTITY COLLECTING A LOCAL TAX WITHIN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE SHALL, WITHIN 31 DAYS OF THE

END OF EACH CALENDAR YEAR, SUBMIT ALL OF THE LOCAL TAXES THAT

ARE TO BE CALCULATED UNDER THIS SUBSECTION AND WHICH WERE

PAID IN THE PRIOR CALENDAR YEAR, LESS ANY CERTIFIED LOCAL TAX

REFUNDS RECEIVED BY A QUALIFIED BUSINESS IN THE PRIOR

CALENDAR YEAR, TO THE STATE TREASURER TO BE DEPOSITED UNDER

SUBSECTION (G).

(5) THIS SUBSECTION SHALL NOT APPLY TO ANY TAXES SUBJECT

TO A VALID PLEDGE OR SECURITY INTEREST ENTERED INTO IN ORDER

TO SECURE DEBT SERVICE ON BONDS IF THE PLEDGE OR SECURITY

INTEREST WAS ENTERED INTO PRIOR TO THE DESIGNATION OF AN

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE, AND IS STILL IN

EFFECT.

(6) THE FOLLOWING SHALL BE THE AMOUNTS CALCULATED AND

CERTIFIED SEPARATELY FOR EACH EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE:

(I) AN AMOUNT EQUAL TO ALL CORPORATE NET INCOME TAX,

CAPITAL STOCK AND FRANCHISE TAX, PERSONAL INCOME TAX,

BUSINESS PRIVILEGE TAX, BUSINESS PRIVILEGE LICENSING FEES

AND EARNED INCOME TAX RELATED TO THE OWNERSHIP AND

OPERATION OF A PROFESSIONAL SPORTS ORGANIZATION

CONDUCTING PROFESSIONAL ATHLETIC EVENTS AT THE FACILITY.

(II) AN AMOUNT EQUAL TO ALL OF THE FOLLOWING:

20230HB1219PN2089 - 66 -

(A) ALL PERSONAL INCOME TAX, EARNED INCOME TAX

AND LOCAL SERVICES TAX WITHHELD FROM EMPLOYEES BY A

PROFESSIONAL SPORTS ORGANIZATION CONDUCTING

PROFESSIONAL ATHLETIC EVENTS AT THE FACILITY.

(B) ALL PERSONAL INCOME TAX, EARNED INCOME TAX

AND LOCAL SERVICES TAX WITHHELD FROM THE EMPLOYEES OF

ANY PROVIDER OF EVENTS AT OR SERVICES TO OR ANY

OPERATOR OF AN ENTERPRISE IN THE FACILITY.

AND LOCAL SERVICES TAX TO WHICH THE COMMONWEALTH

WOULD BE ENTITLED FROM PERFORMERS OR OTHER

PARTICIPANTS, INCLUDING VISITING TEAMS, AT AN EVENT

OR ACTIVITY AT THE FACILITY.

(III) AN AMOUNT EQUAL TO ALL SALES AND USE TAX

RELATED TO THE OPERATION OF THE PROFESSIONAL SPORTS

ORGANIZATION AND THE FACILITY AND ENTERPRISES DEVELOPED

AS PART OF THE FACILITY. THIS SUBPARAGRAPH SHALL INCLUDE

SALES AND USE TAX PAID BY A PROVIDER OF EVENTS OR

ACTIVITIES AT OR SERVICES TO THE FACILITY, INCLUDING

SALES AND USE TAX PAID BY VENDORS AND CONCESSIONAIRES AND

CONTRACTORS AT THE FACILITY.

(IV) AN AMOUNT EQUAL TO ALL TAX PAID TO THE

COMMONWEALTH RELATED TO THE SALE OF ANY LIQUOR, WINE OR

MALT OR BREWED BEVERAGE IN THE FACILITY.

(V) THE AMOUNT PAID BY THE PROFESSIONAL SPORTS

ORGANIZATION OR BY ANY PROVIDER OF EVENTS OR ACTIVITIES

AT OR SERVICES TO THE FACILITY OF ANY NEW TAX ENACTED BY

THE COMMONWEALTH AFTER THE EFFECTIVE DATE OF THIS

SUBPARAGRAPH.

(VI) AN AMOUNT EQUAL TO ALL PERSONAL INCOME TAX,

20230HB1219PN2089 - 67 -

EARNED INCOME TAX AND LOCAL SERVICES TAX WITHHELD FROM

PERSONNEL BY THE PROFESSIONAL SPORTS ORGANIZATION OR BY A

CONTRACTOR OR OTHER ENTITY INVOLVED IN THE CONSTRUCTION

OF THE FACILITY.

(VII) AN AMOUNT EQUAL TO ALL SALES AND USE TAX PAID

ON MATERIALS AND OTHER CONSTRUCTION COSTS, WHETHER

WITHHELD OR PAID BY THE PROFESSIONAL SPORTS ORGANIZATION

OR OTHER ENTITY, DIRECTLY RELATED TO THE CONSTRUCTION OF

THE FACILITY.

(VIII) AN AMOUNT EQUAL TO ALL OF THE FOLLOWING:

(A) ALL CORPORATE NET INCOME TAX, CAPITAL STOCK

AND FRANCHISE TAX, PERSONAL INCOME TAX, BUSINESS

PRIVILEGE TAX, BUSINESS PRIVILEGE LICENSING FEES AND

EARNED INCOME TAX RELATED TO THE OWNERSHIP AND

OPERATION OF ANY QUALIFIED BUSINESS WITHIN THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE.

(B) ALL PERSONAL INCOME TAX, EARNED INCOME TAX

AND LOCAL SERVICES TAX WITHHELD FROM EMPLOYEES BY A

QUALIFIED BUSINESS WITHIN THE EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE.

AND LOCAL SERVICES TAX WITHHELD FROM THE EMPLOYEES OF

A QUALIFIED BUSINESS THAT PROVIDES EVENTS, ACTIVITIES

OR SERVICES IN THE EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONE.

(D) ALL PERSONAL INCOME TAX, EARNED INCOME TAX

AND LOCAL SERVICES TAX TO WHICH THE COMMONWEALTH

WOULD BE ENTITLED FROM PERFORMERS OR OTHER

PARTICIPANTS AT AN EVENT OR ACTIVITY IN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE.

20230HB1219PN2089 - 68 -

(E) ALL SALES AND USE TAX RELATED TO THE

OPERATION OF A QUALIFIED BUSINESS WITHIN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE. THIS CLAUSE SHALL

INCLUDE SALES AND USE TAX PAID BY A QUALIFIED

BUSINESS THAT PROVIDES EVENTS, ACTIVITIES OR SERVICES

IN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE.

(F) ALL TAX PAID BY A QUALIFIED BUSINESS TO THE

COMMONWEALTH RELATED TO THE SALE OF ANY LIQUOR, WINE

OR MALT OR BREWED BEVERAGE WITHIN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE.

(G) THE AMOUNT PAID BY A QUALIFIED BUSINESS

WITHIN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE OF

ANY NEW TAX ENACTED BY THE COMMONWEALTH FOLLOWING

OCTOBER 9, 2009.

(H) ALL PERSONAL INCOME TAX, EARNED INCOME TAX

AND LOCAL SERVICES TAX WITHHELD FROM PERSONNEL BY A

QUALIFIED BUSINESS INVOLVED IN THE IMPROVEMENT,

DEVELOPMENT OR CONSTRUCTION OF THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE.

(I) ALL SALES AND USE TAX PAID ON MATERIALS AND

OTHER CONSTRUCTION COSTS, WHETHER WITHHELD OR PAID BY

THE PROFESSIONAL SPORTS ORGANIZATION OR OTHER

QUALIFIED BUSINESS, DIRECTLY RELATED TO THE

IMPROVEMENT, DEVELOPMENT OR CONSTRUCTION OF THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE.

(J) AN AMOUNT EQUAL TO ANY AMUSEMENT TAX PAID BY

A QUALIFIED BUSINESS OPERATING IN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE. A POLITICAL

SUBDIVISION OR OTHER ENTITY AUTHORIZED TO COLLECT

AMUSEMENT TAXES MAY NOT IMPOSE OR INCREASE THE RATE

20230HB1219PN2089 - 69 -

OF ANY TAX ON ADMISSIONS TO PLACES OF ENTERTAINMENT,

EXHIBITION OR AMUSEMENT OR UPON ATHLETIC EVENTS IN

THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE WHICH ARE

NOT IN EFFECT ON THE DATE THE EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE IS DESIGNATED BY THE CONTRACTING

AUTHORITY.

(IX) EXCEPT FOR A TAX LEVIED AGAINST REAL PROPERTY

AND NOTWITHSTANDING ANY OTHER PROVISION OF LAW, AN AMOUNT

EQUAL TO ANY TAX IMPOSED BY THE COMMONWEALTH OR ANY OF

THE COMMONWEALTH'S POLITICAL SUBDIVISIONS ON A QUALIFIED

BUSINESS ENGAGED IN AN ACTIVITY WITHIN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE OR DIRECTLY OR INDIRECTLY

ON ANY SALE OR PURCHASE OF GOODS OR SERVICES, WHERE THE

POINT OF SALE OR PURCHASE IS WITHIN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE.

(F) STATE TAX LIABILITY APPORTIONMENT.--FOR THE PURPOSE OF

MAKING THE CALCULATIONS UNDER SUBSECTION (E), THE STATE TAX

LIABILITY OF A QUALIFIED BUSINESS SHALL BE APPORTIONED TO THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE BY MULTIPLYING THE

PENNSYLVANIA STATE TAX LIABILITY BY A FRACTION, THE NUMERATOR OF

WHICH IS THE PROPERTY FACTOR PLUS THE PAYROLL FACTOR PLUS THE

SALES FACTOR AND THE DENOMINATOR OF WHICH IS THREE, IN

ACCORDANCE WITH THE FOLLOWING:

(1) THE PROPERTY FACTOR IS A FRACTION, THE NUMERATOR OF

WHICH IS THE AVERAGE VALUE OF THE TAXPAYER'S REAL AND

TANGIBLE PERSONAL PROPERTY OWNED OR RENTED AND USED IN THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE DURING THE TAX PERIOD

AND THE DENOMINATOR OF WHICH IS THE AVERAGE VALUE OF ALL THE

TAXPAYER'S REAL AND TANGIBLE PERSONAL PROPERTY OWNED OR

RENTED AND USED IN THIS COMMONWEALTH DURING THE TAX PERIOD

20230HB1219PN2089 - 70 -

BUT SHALL NOT INCLUDE THE SECURITY INTEREST OF ANY

CORPORATION AS SELLER OR LESSOR IN PERSONAL PROPERTY SOLD OR

LEASED UNDER A CONDITIONAL SALE, BAILMENT LEASE, CHATTEL

MORTGAGE OR OTHER CONTRACT PROVIDING FOR THE RETENTION OF A

LIEN OR TITLE AS SECURITY FOR THE SALE PRICE OF THE PROPERTY.

(2) THE FOLLOWING APPLY:

(I) THE PAYROLL FACTOR IS A FRACTION, THE NUMERATOR

OF WHICH IS THE TOTAL AMOUNT PAID IN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE DURING THE TAX PERIOD BY

THE TAXPAYER FOR COMPENSATION AND THE DENOMINATOR OF

WHICH IS THE TOTAL COMPENSATION PAID IN THIS COMMONWEALTH

DURING THE TAX PERIOD.

(II) COMPENSATION IS PAID IN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE, IF:

(A) THE PERSON'S SERVICE IS PERFORMED ENTIRELY

WITHIN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE;

(B) THE PERSON'S SERVICE IS PERFORMED BOTH

WITHIN AND OUTSIDE THE EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE, BUT THE SERVICE PERFORMED OUTSIDE

THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE IS

INCIDENTAL TO THE PERSON'S SERVICE WITHIN THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE; OR

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE AND THE BASE

OF OPERATIONS OR, IF THERE IS NO BASE OF OPERATIONS,

THE PLACE FROM WHICH THE SERVICE IS DIRECTED OR

CONTROLLED IS IN THE EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE, OR THE BASE OF OPERATIONS OR THE

PLACE FROM WHICH THE SERVICE IS DIRECTED OR

CONTROLLED IS NOT IN ANY LOCATION IN WHICH SOME PART

20230HB1219PN2089 - 71 -

OF THE SERVICE IS PERFORMED, BUT THE PERSON'S

RESIDENCE IS IN THE EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONE.

(3) THE SALES FACTOR IS A FRACTION, THE NUMERATOR OF

WHICH IS THE TOTAL SALES OF THE TAXPAYER IN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE DURING THE TAX PERIOD AND THE

DENOMINATOR OF WHICH IS THE TOTAL SALES OF THE TAXPAYER IN

THIS COMMONWEALTH DURING THE TAX PERIOD. THE FOLLOWING APPLY:

(I) SALES OF TANGIBLE PERSONAL PROPERTY ARE IN THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE IF THE PROPERTY IS

DELIVERED OR SHIPPED TO A PURCHASER THAT TAKES POSSESSION

WITHIN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE

REGARDLESS OF THE F.O.B. POINT OR OTHER CONDITIONS OF THE

SALE.

(II) SALES OTHER THAN SALES OF TANGIBLE PERSONAL

PROPERTY ARE IN THE EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONE, IF:

(A) THE INCOME-PRODUCING ACTIVITY IS PERFORMED

IN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE; OR

(B) THE INCOME-PRODUCING ACTIVITY IS PERFORMED

BOTH WITHIN AND OUTSIDE THE EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE AND A GREATER PROPORTION OF THE

INCOME-PRODUCING ACTIVITY IS PERFORMED IN THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE THAN IN ANY

OTHER LOCATION, BASED ON COSTS OF PERFORMANCE.

(G) TRANSFERS.--

(1) WITHIN 10 DAYS OF RECEIVING CERTIFICATION UNDER

SUBSECTION (E), THE SECRETARY OF THE BUDGET SHALL DIRECT THE

STATE TREASURER TO, NOTWITHSTANDING ANY OTHER PROVISION OF

LAW, TRANSFER THE AMOUNTS CERTIFIED UNDER SUBSECTION (E) FOR

20230HB1219PN2089 - 72 -

EACH EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE FROM THE GENERAL

FUND TO THE ACCOUNT OF THE CONTRACTING AUTHORITY THAT

ESTABLISHED THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE.

(2) BEGINNING IN THE SECOND CALENDAR YEAR FOLLOWING THE

DESIGNATION OF AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE AND

IN EACH YEAR THEREAFTER, THE AMOUNTS CERTIFIED BY THE

SECRETARY OF THE BUDGET TO THE STATE TREASURER AND THE

AMOUNTS TRANSFERRED BY THE STATE TREASURER TO THE ACCOUNT OF

EACH CONTRACTING AUTHORITY SHALL BE DETERMINED AS FOLLOWS:

(I) ADD AMOUNTS CERTIFIED BY THE DEPARTMENT UNDER

SUBSECTION (E) FOR THE PRIOR CALENDAR YEAR.

(II) SUBTRACT FROM THE SUM UNDER SUBPARAGRAPH (I)

ANY STATE TAX REFUNDS PAID AS CERTIFIED BY THE DEPARTMENT

UNDER SUBSECTION (E).

(III) ADD TO THE DIFFERENCE UNDER SUBPARAGRAPH (II)

ANY AMOUNTS CERTIFIED UNDER SUBSECTION (E) WITH RESPECT

TO THE SECOND PRIOR CALENDAR YEAR.

(IV) SUBTRACT FROM THE SUM UNDER SUBPARAGRAPH (III)

ANY AMOUNTS CERTIFIED UNDER SUBSECTION (E) WHICH ARE LESS

THAN THE AMOUNTS PREVIOUSLY CERTIFIED UNDER SUBSECTION

(E) WITH RESPECT TO THE SECOND PRIOR CALENDAR YEAR.

(3) THE STATE TREASURER SHALL PROVIDE AN ANNUAL TRANSFER

TO THE CONTRACTING AUTHORITY UNTIL THE BONDS ISSUED TO

FINANCE AND REFINANCE THE IMPROVEMENT AND DEVELOPMENT OF THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE AND THE CONSTRUCTION

OF THE FACILITY ARE RETIRED. EACH ANNUAL TRANSFER TO THE

CONTRACTING AUTHORITY SHALL BE EQUAL TO THE BALANCE OF THE

ACCOUNT OF THE CONTRACTING AUTHORITY ON THE DATE OF THE

TRANSFER UNDER PARAGRAPH (1).

(H) RESTRICTION ON USE OF MONEY.--MONEY TRANSFERRED UNDER

20230HB1219PN2089 - 73 -

SUBSECTION (G) IS SUBJECT TO THE FOLLOWING:

(1) THE MONEY MAY ONLY BE UTILIZED AS FOLLOWS:

(I) FOR PAYMENT OF DEBT SERVICE, DIRECTLY OR

INDIRECTLY THROUGH A MULTITIERED OWNERSHIP STRUCTURE OR

OTHER STRUCTURE AUTHORIZED BY A CONTRACTING AUTHORITY TO

FACILITATE FINANCING MECHANISMS, ON BONDS OR ON

REFINANCING LOANS USED TO REPAY BONDS ISSUED TO FINANCE

OR REFINANCE:

(A) THE IMPROVEMENT AND DEVELOPMENT OF ALL OR

ANY PART OF THE EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONE; AND

(B) THE CONSTRUCTION OF ALL OR PART OF A

FACILITY.

(II) FOR PAYMENT OF DEBT SERVICE ON BONDS ISSUED TO

REFUND THOSE BONDS.

(III) FOR REPLENISHMENT OF AMOUNTS REQUIRED IN ANY

DEBT SERVICE RESERVE FUNDS ESTABLISHED TO PAY DEBT

SERVICE ON BONDS.

(2) THE TERM OF A BOND TO BE REFUNDED SHALL NOT EXCEED

THE MAXIMUM TERM PERMITTED FOR THE ORIGINAL BOND ISSUED FOR

THE IMPROVEMENT OR DEVELOPMENT OF THE EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE AND THE CONSTRUCTION OF A FACILITY.

(3) THE MONEY MAY NOT BE UTILIZED FOR PURPOSES OF

RENOVATING OR REPAIRING A FACILITY, EXCEPT FOR CAPITAL

MAINTENANCE AND IMPROVEMENT PROJECTS.

(I) TICKET SURCHARGE.--THE ENTITY OPERATING THE FACILITY MAY

COLLECT A CAPITAL REPAIR AND IMPROVEMENT TICKET SURCHARGE, THE

PROCEEDS OF WHICH SHALL BE DEPOSITED INTO THE ACCOUNT OF EACH

CONTRACTING AUTHORITY. THE ACCOUNT OF EACH CONTRACTING AUTHORITY

SHALL BE MAINTAINED AND UTILIZED AS FOLLOWS:

20230HB1219PN2089 - 74 -

(1) THE MONEY DEPOSITED UNDER THIS SUBSECTION MAY NOT BE

ENCUMBERED FOR ANY REASON AND SHALL BE TRANSFERRED TO THE

ENTITY FOR CAPITAL REPAIR AND IMPROVEMENT PROJECTS UPON

REQUEST FROM THE ENTITY.

(2) UPON THE EXPIRATION OF THE EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE UNDER SECTION 1909-B.1, ANY AND ALL PORTIONS

OF THE FUND ATTRIBUTABLE TO THE TICKET SURCHARGE SHALL BE

IMMEDIATELY TRANSFERRED TO THE CONTRACTING AUTHORITY TO BE

HELD IN ESCROW WHERE THE MONEY SHALL BE UNENCUMBERED AND

MAINTAINED BY THE CONTRACTING AUTHORITY IN THE SAME MANNER AS

THE FUND. UPON THE TRANSFER, ANY TICKET SURCHARGE COLLECTED

BY THE OPERATING ENTITY SHALL THEREAFTER BE DEPOSITED IN THE

ACCOUNT MAINTAINED BY THE CONTRACTING AUTHORITY AND DISPERSED

FOR A CAPITAL REPAIR AND IMPROVEMENT PROJECT UPON REQUEST BY

THE OPERATING ENTITY.

(J) EXCESS MONEY.--WITHIN 30 DAYS OF THE END OF EACH

CALENDAR YEAR, ANY MONEY REMAINING IN THE ACCOUNT OF EACH

CONTRACTING AUTHORITY AT THE END OF THE PRIOR CALENDAR YEAR

AFTER THE REQUIRED PAYMENTS UNDER SUBSECTION (G)(2) WERE MADE IN

THE PRIOR CALENDAR YEAR SHALL BE REFUNDED IN THE FOLLOWING

MANNER:

(1) MONEY SHALL FIRST BE RETURNED TO THE GENERAL FUND TO

THE EXTENT THAT THE EXCESS MONEY IS PART OF THE TRANSFER

UNDER SUBSECTION (G)(1).

(2) MONEY SHALL NEXT BE PAID TO THE CONTRACTING

AUTHORITY TO THE EXTENT THAT THE AMOUNTS PAID UNDER

SUBSECTION (G)(2) CONSISTED OF LOCAL TAXES. THE CONTRACTING

AUTHORITY SHALL RETURN THE MONEY TO THE APPROPRIATE ENTITIES

COLLECTING LOCAL TAX WHO SUBMITTED THE LOCAL TAXES TO THE

STATE TREASURER UNDER SUBSECTION (E).

20230HB1219PN2089 - 75 -

(K) AUDIT.--

(1) THE CONTRACTING AUTHORITY SHALL HIRE AN INDEPENDENT

AUDITING FIRM TO PERFORM AN ANNUAL AUDIT VERIFYING ALL OF THE

FOLLOWING:

(I) THE CORRECT AMOUNT OF THE ELIGIBLE LOCAL TAX WAS

SUBMITTED TO THE LOCAL TAXING AUTHORITIES.

(II) THE LOCAL TAXING AUTHORITIES TRANSFERRED THE

CORRECT AMOUNT OF ELIGIBLE LOCAL TAX TO THE STATE

TREASURER.

(III) THE MONEY TRANSFERRED TO THE FUND WAS PROPERLY

EXPENDED.

(IV) THE CORRECT AMOUNT OF EXCESS MONEY WAS REFUNDED

IN ACCORDANCE WITH THE PROVISIONS OF SUBSECTION (J).

(2) A COPY OF EACH ANNUAL AUDIT UNDER PARAGRAPH (1)

SHALL BE SENT TO THE DEPARTMENT AND THE SECRETARY OF THE

BUDGET.

(3) FOR PURPOSES OF THIS SUBSECTION, AN AUDITING FIRM

SHALL NOT BE CONSIDERED INDEPENDENT IF THE AUDITING FIRM

PROVIDES SERVICES TO AN OPERATING ORGANIZATION OR ANY

QUALIFIED BUSINESS WITHIN AN EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE WHICH IS A PARTY TO A SEPARATE AGREEMENT

WITH A CONTRACTING AUTHORITY FOR THE ALLOCATION OF FUNDS FROM

THE CONTRACTING AUTHORITY.

SECTION 1905-B.1. TAXES.

(A) PROHIBITION.--A DIVISION OF LOCAL GOVERNMENT MAY NOT

ASSESS REAL ESTATE TAXES ON ANY PROPERTY IN AN EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE OWNED BY A CONTRACTING AUTHORITY.

(B) LOCAL HOTEL TAX.--NOTWITHSTANDING ANY OTHER PROVISION OF

LAW, REVENUE GENERATED FROM LOCAL HOTEL TAXES LEVIED IN AN

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE MUST FIRST BE SET ASIDE

20230HB1219PN2089 - 76 -

FOR NEW DEVELOPMENT AND CAPITAL IMPROVEMENT OF HOTEL PROPERTIES

IN THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE. IF THERE IS NO

NEW HOTEL PROPERTY DEVELOPMENT OR CAPITAL IMPROVEMENT IN THE

EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE, THE REVENUE GENERATED

FROM HOTEL TAXES SHALL BE DISTRIBUTED AS PROVIDED UNDER LOCAL

HOTEL TAX LAW.

FROM LOCAL HOTEL TAXES SHALL ONLY INCLUDE THE AMOUNT OF LOCAL

HOTEL TAXES COLLECTED FROM HOTEL ACTIVITIES WHICH EXCEED THE

AMOUNT COLLECTED FROM HOTEL ACTIVITIES OCCURRING PRIOR TO THE

DESIGNATION OF AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE BY THE

CONTRACTING AUTHORITY.

SECTION 1906-B.1. PROPERTY ASSESSMENT.

NOTWITHSTANDING 53 PA.C.S. CH. 88 (RELATING TO CONSOLIDATED

COUNTY ASSESSMENT), FOR PURPOSES OF DETERMINING THE ASSESSED

VALUE OF PROPERTY LOCATED IN AN EXPANDED NEIGHBORHOOD

IMPROVEMENT ZONE, THE ACTUAL FAIR MARKET VALUE OF THE PROPERTY

SHALL BE ESTABLISHED WITHOUT UTILIZING OR CONSIDERING THE COST

APPROACH TO VALUATION, AND ANY MONEY RECEIVED BY THE CONTRACTING

AUTHORITY AND UTILIZED DIRECTLY OR INDIRECTLY IN CONNECTION WITH

THE PROPERTY SHALL NOT BE CONSIDERED REAL PROPERTY OR INCOME

ATTRIBUTABLE TO THE PROPERTY.

SECTION 1907-B.1. TRANSFER OF PROPERTY.

(A) TRANSFER OF PARCELS.--PARCELS IN A ZONE MAY BE

TRANSFERRED OUT OF THE ZONE AND REPLACED WITH PARCELS NOT TO

EXCEED THE ACREAGE TRANSFERRED OUT OF THE ZONE BY THE

CONTRACTING AUTHORITY, IF:

(1) THE DEPARTMENT CERTIFIES THAT THERE IS CURRENTLY NO

ACTIVITY IN THE PARCELS TRANSFERRED IN THE ZONE THAT

GENERATES TAX RECEIPTS OR OTHER REVENUE TO THE COMMONWEALTH.

20230HB1219PN2089 - 77 -

(2) THE MUNICIPALITY WHERE THE ZONE IS LOCATED CERTIFIES

THAT THERE IS CURRENTLY NO ACTIVITY IN THE PARCELS

TRANSFERRED INTO THE ZONE THAT GENERATES TAX RECEIPTS OR

OTHER REVENUE, OTHER THAN TAXES ON REAL PROPERTY, TO THE

MUNICIPALITY AND THE SCHOOL DISTRICT AND COUNTY WHERE THE

ZONE IS LOCATED.

(B) PUBLIC HEARING.--

(1) FOR A PARCEL IDENTIFIED BY THE CONTRACTING AUTHORITY

TO BE TRANSFERRED OUT OF THE ZONE, THE CONTRACTING AUTHORITY

MAY CONDUCT A PUBLIC HEARING PURSUANT TO A REQUEST FROM AN

OWNER OF REAL ESTATE LOCATED WITHIN THE PARCEL OR THE CITY OR

MUNICIPALITY WHERE THE PARCEL SITS. THE HEARING SHALL BE HELD

AND NOTICE OF THE HEARING PROVIDED TO THE OWNER OF THE PARCEL

IN ACCORDANCE WITH SECTION 908 OF THE ACT OF JULY 31, 1968

(P.L.805, NO.247), KNOWN AS THE PENNSYLVANIA MUNICIPALITIES

PLANNING CODE.

(2) IF THE CONTRACTING AUTHORITY DETERMINES THAT IT WILL

TRANSFER A PARCEL OUT OF THE ZONE, THE CONTRACTING AUTHORITY

SHALL ISSUE A WRITTEN OPINION WITHIN 45 DAYS OF THE HEARING

SPECIFYING THE REASONS SUPPORTING THE DETERMINATION.

SECTION 1908-B.1. KEYSTONE OPPORTUNITY ZONE.

WITHIN FOUR MONTHS FOLLOWING THE DESIGNATION OF AN EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE, A CITY MAY APPLY TO THE

DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT TO DECERTIFY

AND REMOVE THE DESIGNATION OF ALL OR PART OF THE KEYSTONE

OPPORTUNITY ZONE ON BEHALF OF ALL POLITICAL SUBDIVISIONS. THE

PROVISIONS OF SECTION 309 OF THE ACT OF OCTOBER 6, 1998

(P.L.705, NO.92), KNOWN AS THE KEYSTONE OPPORTUNITY ZONE,

KEYSTONE OPPORTUNITY EXPANSION ZONE AND KEYSTONE OPPORTUNITY

IMPROVEMENT ZONE ACT, SHALL BE DEEMED SATISFIED AS TO ALL

20230HB1219PN2089 - 78 -

POLITICAL SUBDIVISIONS. THE DEPARTMENT OF COMMUNITY AND ECONOMIC

DEVELOPMENT SHALL ACT ON THE APPLICATION WITHIN 30 DAYS.

SECTION 1909-B.1. DURATION.

THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE SHALL BE IN EFFECT

FOR A PERIOD EQUAL TO ONE YEAR FOLLOWING RETIREMENT OF ALL BONDS

ISSUED TO FINANCE OR REFINANCE THE IMPROVEMENT AND DEVELOPMENT

OF THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE OR THE

CONSTRUCTION OF THE FACILITY. THE MAXIMUM TERM OF THE BOND,

INCLUDING THE REFUNDING OF THE BOND, SHALL NOT EXCEED 30 YEARS.

SECTION 1910-B.1. COMMONWEALTH PLEDGES.

IF AND TO THE EXTENT THAT THE CONTRACTING AUTHORITY PLEDGES

AMOUNTS REQUIRED TO BE TRANSFERRED TO THE ACCOUNT OF THE

CONTRACTING AUTHORITY UNDER SECTION 1904-B.1 FOR THE PAYMENT OF

BONDS ISSUED BY THE CONTRACTING AUTHORITY, UNTIL ALL BONDS

SECURED BY THE PLEDGE OF THE CONTRACTING AUTHORITY, TOGETHER

WITH THE INTEREST ON THE BONDS, ARE FULLY PAID OR PROVIDED FOR,

THE COMMONWEALTH PLEDGES TO AND AGREES WITH ANY PERSON, FIRM,

CORPORATION OR GOVERNMENT AGENCY, WHETHER IN THIS COMMONWEALTH

OR ELSEWHERE, AND TO AND WITH ANY FEDERAL AGENCY SUBSCRIBING TO

OR ACQUIRING THE BONDS ISSUED BY THE CONTRACTING AUTHORITY THAT

THE COMMONWEALTH ITSELF WILL NOT NOR WILL IT AUTHORIZE ANY

GOVERNMENT ENTITY TO ABOLISH OR REDUCE THE SIZE OF THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE, TO AMEND OR REPEAL SECTION 1904-

B.1(B), (E) OR (G), TO LIMIT OR ALTER THE RIGHTS VESTED IN THE

CONTRACTING AUTHORITY IN A MANNER INCONSISTENT WITH THE

OBLIGATIONS OF THE CONTRACTING AUTHORITY WITH RESPECT TO THE

BONDS ISSUED BY THE CONTRACTING AUTHORITY OR TO OTHERWISE IMPAIR

REVENUES TO BE PAID UNDER THIS ARTICLE TO THE CONTRACTING

AUTHORITY NECESSARY TO PAY DEBT SERVICE ON BONDS. NOTHING IN

THIS SECTION SHALL LIMIT THE AUTHORITY OF THE COMMONWEALTH OR

20230HB1219PN2089 - 79 -

ANY GOVERNMENT ENTITY TO CHANGE THE RATE, TAX BASES OR ANY

SUBJECT OF ANY SPECIFIC TAX OR REPEALING OR ENACTING ANY TAX.

SECTION 1911-B.1. CONFIDENTIALITY.

NOTWITHSTANDING ANY OTHER PROVISION OF LAW PROVIDING FOR THE

CONFIDENTIALITY OF TAX RECORDS, THE CONTRACTING AUTHORITY AND

THE LOCAL TAXING AUTHORITIES SHALL HAVE ACCESS TO ANY REPORTS

AND CERTIFICATIONS FILED UNDER THIS ARTICLE, AND THE CONTRACTING

AUTHORITY SHALL HAVE ACCESS TO ANY STATE OR LOCAL TAX

INFORMATION FILED BY A QUALIFIED BUSINESS IN THE EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE SOLELY FOR THE PURPOSE OF

DOCUMENTING THE CERTIFICATIONS REQUIRED BY THIS ARTICLE OR

DETERMINING THE AMOUNT ALLOCATED TO ANY USES SPECIFIED UNDER

SECTION 1904-B.1(H)(1). ANY OTHER USE OF THE TAX INFORMATION

SHALL BE PROHIBITED AS PROVIDED UNDER LAW.

SECTION 1912-B.1. EXCEPTIONS.

BEGINNING WITH THE 2024 CALENDAR YEAR, NONE OF THE FOLLOWING

MAY BE EMPLOYED BY, BE CONTRACTING WITH OR PROVIDE SERVICES FOR

A CONTRACTING AUTHORITY:

(1) AN INDIVIDUAL EMPLOYED BY, CONTRACTING WITH OR

PROVIDING SERVICE FOR A CITY THAT HAS AN EXPANDED

NEIGHBORHOOD IMPROVEMENT ZONE.

(2) AN ENTITY CONTRACTING WITH OR PROVIDING SERVICES FOR

A CITY THAT HAS AN EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE.

(3) AN INDIVIDUAL OWNING AN ENTITY OR AN ENTITY WITH

OWNERSHIP INTEREST IN A SEPARATE ENTITY WHICH IS CONTRACTING

WITH A CITY THAT HAS AN EXPANDED NEIGHBORHOOD IMPROVEMENT

ZONE.

(4) AN INDIVIDUAL OR AN ENTITY EMPLOYED BY, CONTRACTING

WITH OR PROVIDING SERVICES FOR A QUALIFIED BUSINESS WITHIN

THE EXPANDED NEIGHBORHOOD IMPROVEMENT ZONE WHICH IS PARTY TO

20230HB1219PN2089 - 80 -

A SEPARATE AGREEMENT WITH A CONTRACTING AUTHORITY FOR THE

ALLOCATION OF FUNDS FROM THE CONTRACTING AUTHORITY.

(5) AN INDIVIDUAL OR AN ENTITY EMPLOYED BY, CONTRACTING

WITH OR PROVIDING SERVICES FOR AN OPERATING ORGANIZATION.

(6) A CURRENT BOARD MEMBER OF A CONTRACTING AUTHORITY.

(7) AN ENTITY THAT IS OWNED BY OR EMPLOYS A CURRENT

BOARD MEMBER OF A CONTRACTING AUTHORITY.

SECTION 13. SECTION 1903-I(A) AND (B) OF THE ACT, ADDED JULY

8, 2022 (P.L.513, NO.53), ARE AMENDED AND THE SECTION IS AMENDED

BY ADDING A SUBSECTION TO READ:

SECTION 1903-I. CREDIT FOR CHILD AND DEPENDENT CARE EMPLOYMENT-

RELATED EXPENSES.

(A) TAX CREDIT.--[FOR TAXABLE YEARS BEGINNING AFTER DECEMBER

31, 2021, A] A TAXPAYER WHO RECEIVES A CREDIT UNDER SECTION 21

OF THE INTERNAL REVENUE CODE OF 1986 MAY CLAIM A TAX CREDIT

AGAINST THE TAXPAYER'S TAX LIABILITY IN ACCORDANCE WITH THIS

SECTION.

[(B) AMOUNT OF TAX CREDIT.--THE AMOUNT OF THE TAX CREDIT

UNDER SUBSECTION (A) SHALL BE EQUAL TO 30% OF:

(1) THE ACTUAL AMOUNT OF EMPLOYMENT-RELATED EXPENSES

INCURRED BY THE TAXPAYER AND CLAIMED FOR THE FEDERAL TAX

CREDIT UNDER SECTION 21 OF THE INTERNAL REVENUE CODE OF 1986

DURING THE PRIOR TAXABLE YEAR, OR THE FOLLOWING, AS

APPLICABLE, WHICHEVER IS LESS:

(I) $3,000 FOR ONE QUALIFYING INDIVIDUAL WITH

RESPECT TO THE TAXPAYER; OR

(II) $6,000 FOR TWO OR MORE QUALIFYING INDIVIDUALS

WITH RESPECT TO THE TAXPAYER; MULTIPLIED BY

(2) THE APPLICABLE PERCENT, WITH RESPECT TO THE

TAXPAYER, IN EFFECT FOR THE TAXABLE YEAR BEGINNING AFTER

20230HB1219PN2089 - 81 -

DECEMBER 31, 2021, AND ENDING BEFORE JANUARY 1, 2023.]

(B.1) AMOUNT OF TAX CREDIT IN SUBSEQUENT TAX YEARS.--FOR

TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2021, THE AMOUNT OF

THE TAX CREDIT UNDER SUBSECTION (A) SHALL BE EQUAL TO THE

FOLLOWING:

(1) FOR THE TAXABLE YEAR BEGINNING AFTER DECEMBER 31,

2021, AND ENDING BEFORE JANUARY 1, 2023, 30% OF:

(I) THE ACTUAL AMOUNT OF EMPLOYMENT-RELATED EXPENSES

INCURRED BY THE TAXPAYER AND CLAIMED FOR THE FEDERAL TAX

CREDIT UNDER SECTION 21 OF THE INTERNAL REVENUE CODE OF

1986 DURING THE PRIOR TAXABLE YEAR, OR THE FOLLOWING, AS

APPLICABLE, WHICHEVER IS LESS:

(A) $3,000 FOR ONE QUALIFYING INDIVIDUAL WITH

RESPECT TO THE TAXPAYER; OR

(B) $6,000 FOR TWO OR MORE QUALIFYING

INDIVIDUALS WITH RESPECT TO THE TAXPAYER; MULTIPLIED

(II) THE APPLICABLE PERCENT, WITH RESPECT TO THE

TAXPAYER, IN EFFECT FOR THE TAXABLE YEAR BEGINNING AFTER

DECEMBER 31, 2021, AND ENDING BEFORE JANUARY 1, 2023.

(2) FOR THE TAXABLE YEAR BEGINNING AFTER DECEMBER 31,

2022, AND ENDING BEFORE JANUARY 1, 2024, 30% OF THE FOLLOWING

AMOUNTS, WHICHEVER IS LESS:

(I) THE ACTUAL AMOUNT OF EMPLOYMENT-RELATED EXPENSES

INCURRED BY THE TAXPAYER AND CLAIMED FOR THE FEDERAL TAX

CREDIT UNDER SECTION 21 OF THE INTERNAL REVENUE CODE OF

1986 DURING THE PRIOR TAXABLE YEAR; OR

(II) THE FOLLOWING AMOUNTS:

(A) $3,000 FOR ONE QUALIFYING INDIVIDUAL WITH

RESPECT TO THE TAXPAYER; OR

20230HB1219PN2089 - 82 -

(B) $6,000 FOR TWO OR MORE QUALIFYING

INDIVIDUALS WITH RESPECT TO THE TAXPAYER.

(3) FOR THE TAXABLE YEAR BEGINNING AFTER DECEMBER 31,

2023, AND ENDING BEFORE JANUARY 1, 2025, 35% OF THE FOLLOWING

AMOUNTS, WHICHEVER IS LESS:

(I) THE ACTUAL AMOUNT OF EMPLOYMENT-RELATED EXPENSES

INCURRED BY THE TAXPAYER AND CLAIMED FOR THE FEDERAL TAX

CREDIT UNDER SECTION 21 OF THE INTERNAL REVENUE CODE OF

1986 DURING THE PRIOR TAXABLE YEAR; OR

(II) THE FOLLOWING AMOUNTS:

(A) $3,500 FOR ONE QUALIFYING INDIVIDUAL WITH

RESPECT TO THE TAXPAYER; OR

(B) $7,000 FOR TWO OR MORE QUALIFYING

INDIVIDUALS WITH RESPECT TO THE TAXPAYER.

(4) FOR THE TAXABLE YEAR BEGINNING AFTER DECEMBER 31,

2024, AND ENDING BEFORE JANUARY 1, 2026, 40% OF THE FOLLOWING

AMOUNTS, WHICHEVER IS LESS:

(I) THE ACTUAL AMOUNT OF EMPLOYMENT-RELATED EXPENSES

INCURRED BY THE TAXPAYER AND CLAIMED FOR THE FEDERAL TAX

CREDIT UNDER SECTION 21 OF THE INTERNAL REVENUE CODE OF

1986 DURING THE PRIOR TAXABLE YEAR; OR

(II) THE FOLLOWING AMOUNTS:

(A) $4,000 FOR ONE QUALIFYING INDIVIDUAL WITH

RESPECT TO THE TAXPAYER; OR

(B) $8,000 FOR TWO OR MORE QUALIFYING

INDIVIDUALS WITH RESPECT TO THE TAXPAYER.

(5) FOR THE TAXABLE YEAR BEGINNING AFTER DECEMBER 31,

2025, AND ENDING BEFORE JANUARY 1, 2027, 45% OF THE FOLLOWING

AMOUNTS, WHICHEVER IS LESS:

(I) THE ACTUAL AMOUNT OF EMPLOYMENT-RELATED EXPENSES

20230HB1219PN2089 - 83 -

INCURRED BY THE TAXPAYER AND CLAIMED FOR THE FEDERAL TAX

CREDIT UNDER SECTION 21 OF THE INTERNAL REVENUE CODE OF

1986 DURING THE PRIOR TAXABLE YEAR; OR

(II) THE FOLLOWING AMOUNTS:

(A) $4,500 FOR ONE QUALIFYING INDIVIDUAL WITH

RESPECT TO THE TAXPAYER; OR

(B) $9,000 FOR TWO OR MORE QUALIFYING

INDIVIDUALS WITH RESPECT TO THE TAXPAYER.

(6) FOR THE TAXABLE YEAR BEGINNING AFTER DECEMBER 31,

2026, AND FOR EACH TAXABLE YEAR THEREAFTER, 50% OF THE

FOLLOWING AMOUNTS, WHICHEVER IS LESS:

(I) THE ACTUAL AMOUNT OF EMPLOYMENT-RELATED EXPENSES

INCURRED BY THE TAXPAYER AND CLAIMED FOR THE FEDERAL TAX

CREDIT UNDER SECTION 21 OF THE INTERNAL REVENUE CODE OF

1986 DURING THE PRIOR TAXABLE YEAR; OR

(II) THE FOLLOWING AMOUNTS:

(A) $5,000 FOR ONE QUALIFYING INDIVIDUAL WITH

RESPECT TO THE TAXPAYER; OR

(B) $10,000 FOR TWO OR MORE QUALIFYING

INDIVIDUALS WITH RESPECT TO THE TAXPAYER.

* * *

SECTION 14. THE ACT IS AMENDED BY ADDING AN ARTICLE TO READ:

ARTICLE XXIII-A

PUBLIC TRANSPORTATION TRUST FUND

SECTION 2301-A. TRANSFERS TO PUBLIC TRANSPORTATION TRUST FUND.

NOTWITHSTANDING 74 PA.C.S. § 1506(C)(1) (RELATING TO FUND),

6.4% OF THE AMOUNT COLLECTED UNDER ARTICLE II SHALL BE DEPOSITED

INTO THE PUBLIC TRANSPORTATION TRUST FUND ANNUALLY BY THE 20TH

DAY OF EACH MONTH FOR THE PRECEDING MONTH.

SECTION 2302-A. ANNUAL INCREASE.

20230HB1219PN2089 - 84 -

NOTWITHSTANDING 74 PA.C.S. § 1513(D)(2) (RELATING TO

OPERATING PROGRAM), THE SECRETARY OF TRANSPORTATION MAY ADJUST

AND HOLD HARMLESS THE AMOUNT OF ANNUAL INCREASE IN LOCAL MATCH

UNDER SECTION 1513(D)(2) FOR A PERIOD OF FIVE FISCAL YEARS

BEGINNING IN FISCAL YEAR 2024-2025.

SECTION 15. SECTION 3003.3(D) OF THE ACT IS AMENDED AND THE

SECTION IS AMENDED BY ADDING A SUBSECTION TO READ:

SECTION 3003.3. UNDERPAYMENT OF ESTIMATED TAX.--* * *

(D) NOTWITHSTANDING THE PROVISIONS OF [THE PRECEDING

SUBSECTIONS,] THIS SECTION, OTHER THAN AS SET FORTH IN

SUBSECTION (D.1), INTEREST WITH RESPECT TO ANY UNDERPAYMENT OF

ANY INSTALLMENT OF ESTIMATED TAX SHALL NOT BE IMPOSED IF THE

TOTAL AMOUNT OF ALL PAYMENTS OF ESTIMATED TAX MADE ON OR BEFORE

THE LAST DATE PRESCRIBED FOR THE PAYMENT OF SUCH INSTALLMENT

EQUALS OR EXCEEDS THE AMOUNT WHICH WOULD HAVE BEEN REQUIRED TO

BE PAID ON OR BEFORE SUCH DATE IF THE ESTIMATED TAX WERE AN

AMOUNT EQUAL TO THE TAX COMPUTED AT THE RATES APPLICABLE TO THE

TAXABLE YEAR, INCLUDING ANY MINIMUM TAX IMPOSED, BUT OTHERWISE

ON THE BASIS OF THE FACTS SHOWN ON THE REPORT OF THE TAXPAYER

FOR, AND THE LAW APPLICABLE TO, THE SAFE HARBOR BASE YEAR,

ADJUSTED FOR ANY CHANGES TO SECTIONS 401, 601, 602 AND 1101

ENACTED FOR THE TAXABLE YEAR, IF A REPORT SHOWING A LIABILITY

FOR TAX WAS FILED BY THE TAXPAYER FOR THE SAFE HARBOR BASE YEAR.

IF THE TOTAL AMOUNT OF ALL PAYMENTS OF ESTIMATED TAX MADE ON OR

BEFORE THE LAST DATE PRESCRIBED FOR THE PAYMENT OF SUCH

INSTALLMENT DOES NOT EQUAL OR EXCEED THE AMOUNT REQUIRED TO BE

PAID PER THE PRECEDING SENTENCE, BUT SUCH AMOUNT IS PAID AFTER

THE DATE THE INSTALLMENT WAS REQUIRED TO BE PAID, THEN THE

PERIOD OF UNDERPAYMENT SHALL RUN FROM THE DATE THE INSTALLMENT

WAS REQUIRED TO BE PAID TO THE DATE THE AMOUNT REQUIRED TO BE

20230HB1219PN2089 - 85 -

PAID PER THE PRECEDING SENTENCE IS PAID. PROVIDED, THAT IF THE

TOTAL TAX FOR THE SAFE HARBOR BASE YEAR EXCEEDS THE TAX SHOWN ON

SUCH REPORT BY TEN PER CENT OR MORE, THE TOTAL TAX ADJUSTED TO

REFLECT THE CURRENT TAX RATE SHALL BE USED FOR PURPOSES OF THIS

SUBSECTION. IN THE EVENT THAT THE TOTAL TAX FOR THE SAFE HARBOR

BASE YEAR EXCEEDS THE TAX SHOWN ON THE REPORT BY TEN PER CENT OR

MORE, INTEREST RESULTING FROM THE UTILIZATION OF SUCH TOTAL TAX

IN THE APPLICATION OF THE PROVISIONS OF THIS SUBSECTION SHALL

NOT BE IMPOSED IF, WITHIN FORTY-FIVE DAYS OF THE MAILING DATE OF

EACH ASSESSMENT, PAYMENTS ARE MADE SUCH THAT THE TOTAL AMOUNT OF

ALL PAYMENTS OF ESTIMATED TAX EQUALS OR EXCEEDS THE AMOUNT WHICH

WOULD HAVE BEEN REQUIRED TO BE PAID ON OR BEFORE SUCH DATE IF

THE ESTIMATED TAX WERE AN AMOUNT EQUAL TO THE TOTAL TAX ADJUSTED

TO REFLECT THE CURRENT TAX RATE. IN ANY CASE IN WHICH THE

TAXABLE YEAR FOR WHICH AN UNDERPAYMENT OF ESTIMATED TAX MAY

EXIST IS A SHORT TAXABLE YEAR, IN DETERMINING THE TAX SHOWN ON

THE REPORT OR THE TOTAL TAX FOR THE SAFE HARBOR BASE YEAR, THE

TAX WILL BE REDUCED BY MULTIPLYING IT BY THE RATIO OF THE NUMBER

OF INSTALLMENT PAYMENTS MADE IN THE SHORT TAXABLE YEAR TO THE

NUMBER OF INSTALLMENT PAYMENTS REQUIRED TO BE MADE FOR THE FULL

TAXABLE YEAR.

(D.1) WITH RESPECT TO ANY UNDERPAYMENT OF AN INSTALLMENT OF

ESTIMATED CORPORATE NET INCOME TAX FOR ANY TAX YEAR THAT BEGINS

IN TAXABLE YEAR 2025 OR 2026 BY A CORPORATION REQUIRED TO FILE A

COMBINED ANNUAL REPORT PURSUANT TO SECTION 403(A.1)(1), INTEREST

SHALL NOT BE IMPOSED IF THE TOTAL AMOUNT OF ALL PAYMENTS OF

ESTIMATED CORPORATE NET INCOME TAX MADE ON OR BEFORE THE LAST

DATE PRESCRIBED FOR THE PAYMENT OF SUCH INSTALLMENT EQUALS OR

EXCEEDS THE AMOUNT WHICH WOULD HAVE BEEN REQUIRED TO BE PAID ON

OR BEFORE SUCH DATE IF THE ESTIMATED TAX WERE AN AMOUNT EQUAL TO

20230HB1219PN2089 - 86 -

THE COMBINED TAX SHOWN ON THE REPORTS OF ALL THE MEMBERS OF THE

UNITARY BUSINESS FOR THE SAFE HARBOR BASE YEAR COMPUTED AT THE

RATE APPLICABLE TO THE TAXABLE YEAR.

SECTION 15.1. SECTION 3003.8 OF THE ACT IS AMENDED BY ADDING

A SUBSECTION TO READ:

SECTION 3003.8. METHOD OF FILING.--* * *

REVENUE SHALL MAKE TELEPHONIC FILING OR A REASONABLE ALTERNATIVE

AVAILABLE FOR TAXPAYERS WHO REQUEST AN EXCEPTION FROM ELECTRONIC

FILING DUE TO A RELIGIOUS OBJECTION OR HARDSHIP CAUSED BY A LACK

OF INTERNET ACCESS AND ARE GRANTED THE EXCEPTION FROM THE

DEPARTMENT OF REVENUE.

SECTION 15.2. SECTION 3003.25(A)(2) OF THE ACT, ADDED JULY

8, 2022 (P.L.513, NO.53), IS AMENDED AND THE SECTION IS AMENDED

BY ADDING A SUBSECTION TO READ:

SECTION 3003.25. ALLOCATION OF TAX CREDITS.--(A)

NOTWITHSTANDING ANY OTHER PROVISION OF THIS ACT, THE AMOUNT OF

TAX CREDITS THAT MAY BE AWARDED FOR TAX CREDIT PROGRAMS

SPECIFIED UNDER THIS SUBSECTION SHALL REMAIN AT THE AMOUNT

ALLOCATED FOR FISCAL YEARS BEGINNING AFTER JUNE 30, 2022, AND

ENDING BEFORE JULY 1, 2025:

* * *

[(2) SUBARTICLE B OF ARTICLE XVII-D.]

* * *

(A.1) NOTWITHSTANDING ANY OTHER PROVISION OF THIS ACT, THE

AMOUNT OF TAX CREDITS THAT MAY BE AWARDED FOR THE TAX CREDIT

PROGRAM UNDER SUBARTICLE B OF ARTICLE XVII-D SHALL REMAIN AT THE

AMOUNT ALLOCATED FOR THE FISCAL YEAR BEGINNING AFTER JUNE 30,

2022, AND ENDING BEFORE JULY 1, 2023.

* * *

20230HB1219PN2089 - 87 -

SECTION 15.3. NOTHING IN THIS ACT SHALL BE CONSTRUED TO

INCREASE THE RATE OF TAX IMPOSED UNDER SECTION 1102-C OF THE

ACT.

SECTION 16. THE FOLLOWING SHALL APPLY:

(1) THE ADDITION OF SECTION 303(A.7)(2)(I)(E) OF THE ACT

SHALL APPLY TO TAXABLE YEARS BEGINNING AFTER DECEMBER 31,

2023.

(2) THE ADDITION OF SECTION 304(D)(4) OF THE ACT SHALL

APPLY TO TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2023.

(3) THE AMENDMENT OF SECTION 401(3)1(A), (B) AND (T) AND

(5) OF THE ACT SHALL APPLY TO TAXABLE YEARS BEGINNING AFTER

DECEMBER 31, 2024.

(4) THE ADDITION OF SECTION 401(3)1(B.2) OF THE ACT

SHALL APPLY TO TAXABLE YEARS BEGINNING AFTER DECEMBER 31,

2022.

(5) THE ADDITION OF SECTION 403(A.1) AND (A.2) OF THE

ACT SHALL APPLY TO TAXABLE YEARS BEGINNING AFTER DECEMBER 31,

2024.

(6) THE AMENDMENT OF SECTION 404 OF THE ACT SHALL APPLY

TO TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2024.

(7) THE AMENDMENT OF SECTION 407.7 OF THE ACT SHALL

APPLY TO TAXABLE YEARS BEGINNING AFTER DECEMBER 31, 2023.

(8) THE AMENDMENT OR ADDITION OF SECTION 3003.3(D) AND

(D.1) OF THE ACT SHALL APPLY TO TAXABLE YEARS BEGINNING AFTER

DECEMBER 31, 2024.

(9) THE AMENDMENT OF SECTION 3003.25(A)(2) SHALL APPLY

RETROACTIVELY TO FISCAL YEARS BEGINNING AFTER JUNE 30, 2023.

SECTION 17. THIS ACT SHALL TAKE EFFECT AS FOLLOWS:

(1) THE ADDITION OF SECTION 3003.8(C) OF THE ACT SHALL

TAKE EFFECT JANUARY 1, 2024.

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(2) THE ADDITION OF ARTICLE XXIII-A OF THE ACT SHALL

TAKE EFFECT JULY 1, 2024.

(3) THE FOLLOWING SHALL TAKE EFFECT IN 60 DAYS:

(I) THE ADDITION OF SECTION 303(A.7)(2)(I)(E) OF THE

ACT.

(II) THE ADDITION OF SECTION 304(D)(4) OF THE ACT.

(III) THE ADDITION OF THE DEFINITIONS OF "MAINTAINS

A PLACE OF BUSINESS" OR "MAINTAINING A PLACE OF

BUSINESS," "QUALIFIED LOCATION IN THIS COMMONWEALTH" AND

"REPRESENTATIVE" OF SECTION 1711-D OF THE ACT.

(IV) THE AMENDMENT OF SECTION 1712-D(B) OF THE ACT.

(V) THE AMENDMENT OF SECTION 1714-D(F)(2) OF THE

ACT.

(VI) THE AMENDMENT OR ADDITION OF SECTION 1716-D(B)

(1), (1.3) AND (1.4) OF THE ACT.

(VII) THE ADDITION OF SUBARTICLE G OF ARTICLE XVII-L

OF THE ACT.

(VIII) THE AMENDMENT OF SECTION 1904-A(C) OF THE

ACT.

(IX) THE AMENDMENT OF SECTION 1905-A(A) OF THE ACT.

(X) THE AMENDMENT OF SECTION 1903-I(A) AND (B) OF

THE ACT.

(4) THE REMAINDER OF THIS ACT SHALL TAKE EFFECT

IMMEDIATELY.

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