Bill Text: PA SB1150 | 2011-2012 | Regular Session | Amended

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Bill Title: Providing tax credits for the rehabilitation of historic structures.

Spectrum: Bipartisan Bill

Status: (Engrossed - Dead) 2012-07-02 - Laid on the table [SB1150 Detail]

Download: Pennsylvania-2011-SB1150-Amended.html

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HOUSE AMENDED
PRIOR PRINTER'S NOS. 1432, 1721, 2037, 2200 PRINTER'S NO. 2259
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. 1150 Session of2011
INTRODUCED BY SMUCKER, ERICKSON, ARGALL, RAFFERTY, COSTA, ALLOWAY, FONTANA, WASHINGTON, BOSCOLA, YUDICHAK, WAUGH, YAW, SCHWANK, FERLO, PICCOLA, BROWNE AND BLAKE, JUNE 26, 2011
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES, JUNE 6, 2012
AN ACT
Providing tax credits for the rehabilitation of historic
structures.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Short title.
This act shall be known and may be cited as the Historic
Preservation Incentive Act.
Section 2. Definitions.
The following words and phrases when used in this act shall
have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Commission." The Pennsylvania Historical and Museum
Commission.
"Completed project." The completion of the restoration of a
qualified historic structure in accordance with a qualified
rehabilitation plan and the receipt of an occupancy certificate
for the structure.
"Department." The Department of Revenue of the Commonwealth.
"Internal Revenue Code." The Internal Revenue Code of 1986
(Public Law 99-514, 26 U.S.C. § 1 et seq.).
"Qualified expenditures." The costs and expenses incurred by
a qualified taxpayer in the restoration of a qualified historic
structure pursuant to a qualified rehabilitation plan and which
are defined as qualified rehabilitation expenditures under
section 47(c)(2) of the Internal Revenue Code of 1986 (Public
Law 99-514, 26 U.S.C. § 47(c)(2)).
"Qualified historic structure." A commercial building
located in this Commonwealth that qualifies as a certified
historic structure under section 47(c)(3) of the Internal
Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 47(c)(3)).
"Qualified rehabilitation plan." A plan to rehabilitate a
qualified historic structure that is approved by the
Pennsylvania Historical and Museum Commission as being
consistent with the standards for rehabilitation and guidelines
for rehabilitation of historic buildings as adopted by the
United States Secretary of the Interior.
"Qualified tax liability." Tax liability imposed on a
taxpayer under Article III, IV, VI, VII, VIII, IX, XI or XV of
the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform
Code of 1971, excluding any tax withheld by an employer under
Article III of the Tax Reform Code of 1971.
"Qualified taxpayer." Any natural person, corporation,
business trust, limited liability company, partnership, limited
liability partnership, association or any other form of legal
business entity that:
(1) Is subject to a tax imposed under Article III, IV,
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VI, VII, VIII, IX, XI or XV of the act of March 4, 1971
(P.L.6, No.2), known as the Tax Reform Code of 1971,
excluding any tax withheld by an employer under Article III
of the Tax Reform Code of 1971.
(2) Owns a qualified historic structure.
"Region." A Community Action Team region as established by <--
the Department of Community and Economic Development.
Section 3. Tax credit certificates.
(a) Application.--
(1) A qualified taxpayer may apply to the Department of
Community and Economic Development for a tax credit
certificate under this section.
(2) The application shall be on the form required by the
Department of Community and Economic Development and shall
include a qualified rehabilitation plan.
(3) The application shall be filed on or before February
1 for qualified expenditures incurred in the prior calendar <--
year or to be incurred in the current year and to be incurred <--
in connection with the completed project.
(b) Review, recommendation and approval.--
(1) The Department of Community and Economic Development
shall forward applications received under this section to the
commission for review.
(2) The commission shall review the proposed
rehabilitation plan, verify that the building is a qualified
historic structure and recommend approval or disapproval to
the Department of Community and Economic Development within
30 days of receipt of the application. The commission shall
notify the qualified taxpayer within 15 days of its
determination.
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(3) The commission shall notify the Department of
Community and Economic Development of verification of a
completed project and notify the Department of Community and
Economic Development of the amount of qualified expenditures
incurred by the taxpayer in the prior calendar year in <--
connection with the completed project.
(4) If the Department of Community and Economic
Development has approved the application and received
notification of a completed project, it shall issue the
qualified taxpayer a tax credit certificate by April 1. A tax
credit certificate issued under this section shall not exceed
25% of qualified expenditures determined by the commission to
have been incurred by the qualified taxpayer in the prior <--
calendar year connection with the completed project. <--
(5) In granting tax credit certificates under this act,
the Department of Community and Economic Development:
(i) Shall not grant more than $10,000,000 in tax
credit certificates in any fiscal year.
(ii) Shall not grant more than $500,000 in tax
credit certificates to a single qualified taxpayer in any
fiscal year in which the approval of all recommendations <--
received from the commission would cause the limit in
subparagraph (i) to be exceeded.
(iii) Shall take into account the geographical
distribution of tax credit certificates when taking
action to implement the limit in subparagraph (i) year. <--
(iii) Shall assure that credits are awarded in an
equitable manner to each region in this Commonwealth.
However, credits allocated to a region that are unclaimed
shall be promptly reallocated to eligible projects in
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other regions.
(6) Tax credits under this act shall be made available
on a first-come, first-served basis within the limitation
established under subsection (b)(5).
Section 4. Claiming the credit.
(a) General rule.--Except as provided in subsection (b),
upon presenting a tax credit certificate to the department, the
qualified taxpayer may claim a tax credit against the qualified
tax liability of the qualified taxpayer.
(b) Prohibition.--A qualified taxpayer shall not claim a tax
credit against a qualified tax liability before July 1, 2013.
Section 5. Carryover, carryback and assignment of credit.
(a) General rule.--If a qualified taxpayer cannot use the
entire amount of the tax credit for the taxable year in which
the tax credit is first approved, then the excess may be carried
over to succeeding taxable years and used as a credit against
the qualified tax liability of the qualified taxpayer for those
taxable years. Each time the tax credit is carried over to a
succeeding taxable year, it shall be reduced by the amount that
was used as a credit during the immediately preceding taxable
year. The tax credit provided by this act may be carried over
and applied to succeeding taxable years for not more than seven
taxable years following the first taxable year for which the
qualified taxpayer was entitled to claim the credit.
(b) Application.--A tax credit certificate received by the
department in a taxable year first shall be applied against the
qualified taxpayer's qualified tax liability for the current
taxable year as of the date on which the credit was issued
before the tax credit can be applied against any qualified tax
liability under subsection (a).
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(c) No carryback or refund.--A qualified taxpayer may not
carry back or obtain a refund of all or any portion of an unused
tax credit granted to the qualified taxpayer under this act.
(d) Sale or assignment.--The following shall apply:
(1) A qualified taxpayer, upon application to and
approval by the Department of Community and Economic
Development, may sell or assign, in whole or in part, a tax
credit granted to the qualified taxpayer under this act.
(2) Before an application is approved, the department
must find that the applicant has filed all required State tax
reports and returns for all applicable taxable years and paid
any balance of State tax due as determined at settlement,
assessment or determination by the department.
(3) Notwithstanding any other provision of law, the
department shall settle, assess or determine the tax of an
applicant under this subsection within 90 days of the filing
of all required final returns or reports in accordance with
section 806.1(a)(5) of the act of April 9, 1929 (P.L.343,
No.176), known as The Fiscal Code.
(e) Purchasers and assignees.--The purchaser or assignee of
all or a portion of a tax credit obtained under section 3 shall
immediately claim the credit in the taxable year in which the
purchase or assignment is made. The purchaser or assignee may
not carry forward, carry back or obtain a refund of or sell or
assign the tax credit. The purchaser or assignee shall notify
the department of the seller or assignor of the tax credit in
compliance with procedures specified by the department.
Section 6. Pass-through entity.
(a) General rule.--If a pass-through entity has any unused
tax credit under section 5, it may elect in writing, according
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to procedures established by the department, to transfer all or
a portion of the credit to shareholders, members or partners in
proportion to the share of the entity's distributive income to
which the shareholder, member or partner is entitled.
(b) Limitation.--A pass-through entity and a shareholder,
member or partner of a pass-through entity shall not claim the
credit under subsection (a) for the same qualified expenditures.
(c) Application.--A shareholder, member or partner of a
pass-through entity to whom a credit is transferred under
subsection (a) shall immediately claim the credit in the taxable
year in which the transfer is made. The shareholder, member or
partner may not carry forward, carry back, obtain a refund of or
sell or assign the credit.
Section 7. Administration.
The Department of Community and Economic Development, the
commission and the department shall jointly develop written
guidelines for the implementation of the provisions of this act.
Section 8. Report to General Assembly.
(a) General rule.--Not later than September 1 of each year
after the first year in which tax credit certificates are issued
by the Department of Community and Economic Development, the
Secretary of Community and Economic Development and the
Secretary of Revenue shall submit a report to the General
Assembly summarizing the tax credit certificates awarded and the
tax credits claimed under this act. The report shall be
submitted to the chairman and minority chairman of the
Appropriations and Finance Committees of the Senate and the
chairman and minority chairman of the Appropriations and Finance
Committees of the House of Representatives. The report shall
include all awards of tax credit certificates, claims for tax
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credits, sale or assignment of credits and tax credit
utilization that have occurred since the conclusion of the
period covered by the prior year's report through the June 30
immediately preceding the date of the report. The report shall
include:
(1) The name of each qualified taxpayer that has been
awarded a tax credit certificate.
(2) The name of each qualified taxpayer that has claimed
a credit and the amount of the credit claimed by the
qualified taxpayer.
(3) The name of each qualified taxpayer that has
received approval to sell or assign a credit and the amount
of the credit sold or assigned by the qualified taxpayer.
(4) The name of each taxpayer who has acquired a credit
by sale or assignment, the amount of the credit acquired by
sale or assignment by the taxpayer, the amount of the credit
acquired by sale or assignment that has been utilized by the
taxpayer and the taxes and tax years against which the
taxpayer utilized the credit.
(b) Public information.--Notwithstanding any law providing
for the confidentiality of tax records, the information in the
report shall be public information and all report information
shall be posted on the department's publicly accessible Internet
website.
Section 9. Application of Internal Revenue Code.
The provisions of section 47 of the Internal Revenue Code and
the regulations promulgated regarding those provisions shall
apply to the department's interpretation and administration of
the credit provided under this act. References to the Internal
Revenue Code shall mean the sections of the Internal Revenue
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Code as existing on any date of interpretation of this act,
except if those sections of the Internal Revenue Code referenced
in this act are repealed or terminated, references to the
Internal Revenue Code shall mean those sections last having full
force and effect. If after repeal or termination the Internal
Revenue Code sections are revised or reenacted, references in
this act to Internal Revenue Code sections shall mean those
revised or reenacted sections.
Section 10. Limitation.
Taxpayers shall not be entitled to use apply for historic <--
preservation tax credits for more than seven taxable years after <--
the seventh taxable year following the effective date of this
section.
Section 11 29. Repeal. <--
(a) Declaration.--The General Assembly declares that the
repeal under subsection (b) is necessary to effectuate the
provisions of this act.
(b) Specific law repealed.--The provisions of 27 Pa.C.S. §
6104(d.2)(2) are repealed.
Section 20 30. Effective date. <--
This act shall take effect July 1, 2012, or immediately,
whichever is later.
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