§ 19-1303.3. Authorization to Offer Exemptions from Real Estate Taxes on Improvements to Deteriorated Industrial, Commercial or Other Business Properties. 193

   (1)   Legislative Findings.

      (a)   The Council finds that:

         (.1)   Act 76 of 1977 passed by the General Assembly 194 authorizes local taxing authorities to exempt certain deteriorating industrial, commercial and other business property improvements from taxation under certain terms and conditions.

         (.2)   There are deteriorated industrial, commercial and other business buildings in all wards of the City.

         (.3)   A public hearing, as required by Act 76, has been held regarding the boundaries of the areas containing deteriorated industrial, commercial and other business properties.

   (2)   Eligible Areas.

      (a)   The Council determines that all the wards of the City contain "deteriorated areas" as defined in Act 76 of 1977 and are eligible for tax exemption under the Act.

      (b)   Therefore, persons making improvements to eligible industrial, commercial or other business properties within the definition contained in this ordinance and in any of the foregoing eligible areas, may apply for, and the Board of Revision of Taxes may grant, a real estate tax exemption upon such improvements in the amount and in the manner hereinafter provided.

   (3)   In this Section, the following definitions shall apply:

      (a)   Deteriorated property.

         (.1)   Any industrial, commercial or other business property in an eligible deteriorating area. 195

      (b)   Improvement.

         (.1)   Repair, construction or reconstruction, including alterations and additions, having the effect of rehabilitating a deteriorated property so that it becomes habitable or attains higher standards of safety, health, economic use or amenity or is brought into compliance with laws, ordinances or regulations governing such standards. Ordinary upkeep and maintenance shall not be deemed an improvement.

      (c)   Delinquent City and School District of Philadelphia taxes, charges, fees, rents or claims. All City and School District of Philadelphia taxes, charges, fees, rents or claims not paid when due (including the failure of any employer to pay over to the City any wage taxes that were collected, or that should have been collected but for misclassification of workers) whether or not liens for such have been filed in the Office of the Prothonotary of the county, and shall include all penalties, additions, interest, and costs due on such delinquent taxes, charges, fees, rents or claims.  196

   (4)   Exemptions.

      (a)   Exemption amount.

         (.1)   The amount to be exempted from real estate taxes shall be limited to that portion of the additional assessment attributable to the actual cost of improvements.

         (.2)   The exemption from real estate taxes shall be limited to that improvement for which an exemption has been requested in the manner set forth below, and for which a separate assessment has been made by the Board of Revisions of Taxes.

      (b)   Exemption schedule.

         (.1)   With respect to applications for exemption initially applied for on or before December 31, 2021, the assessable amount of the improvement costs shall be exempted from real estate taxes for ten (10) years. With respect to applications for exemption initially applied for after December 31, 2021, ninety percent (90%) of the assessable amount of the improvement costs shall be exempted from real estate taxes for ten (10) years. The exemption shall commence in the tax year immediately following the year in which the initial certificate of occupancy for the property is issued. After the tenth year, the exemption shall terminate. 197

         (.2)   The exemption from taxes granted under this ordinance shall be upon the property and shall not terminate upon the sale or exchange of the property.

      (c)   Procedure for obtaining exemption.

         (.1)   At the time a building permit for the construction of an improvement is applied for, the Department of Licenses and Inspections shall notify the applicant by a printed notice of the possibility of a tax exemption under this bill. Within sixty (60) days of the date the building permit is issued, the taxpayer shall apply to the Board of Revision of Taxes for such exemption. The application shall be in writing upon forms prescribed by the Board of Revision of Taxes and must be filed within the specified time period.

         (.2)   The Board of Revision of Taxes shall determine whether the exemption shall be granted. A copy of the approved request for exemption shall be forwarded by the Board of Revision of Taxes to the taxpayer.

         (.3)   The Board of Revision of Taxes in determining whether the exemption shall be granted shall inquire of the Department of Revenue of the City of Philadelphia whether the taxpayer is indebted to the City or School District of Philadelphia for or on account of any delinquent taxes, charges, fees, rents or claims. The taxpayer shall provide to the Department such documentation as the Department shall require in order to determine whether there is any delinquency, including whether the taxpayer has paid over to the City all required wage taxes. The Board of Revision of Taxes shall withhold approval of the application until the taxpayer pays or enters into an agreement with the City of Philadelphia to pay the tax, charge, fee, rent or claim. The Board of Revision of Taxes shall withdraw approval where the taxpayer fails to pay delinquent taxes, charges, fees, rents or claims during the exemption period or fails to comply with his agreement to pay as provided herein. Any withholding shall not be construed to stay the tolling of the exemption period for which a taxpayer would otherwise qualify. 198

         (.4)   The Board of Revision of Taxes shall, after it has determined that the improvement is completed, assesses separately the improvement and calculate the amounts of assessment eligible for exemption in accordance with the exemption schedule in subsection (b)(.1) above. 199

         (.5)   The Board of Revision of Taxes shall notify the taxpayer of the amount of assessment eligible for exemption. 200

         (.6)   Appeals from the reassessment and the amount eligible for the exemption may be taken by the City or by the taxpayer as provided by law. 201

      (d)   Continuation of tax exemption; termination of tax exemption. 202

         (.1)   The tax exemption granted by the Board of Revision of Taxes shall continue in accordance with this Section, provided that the applicant files an annual certificate of continuing use stating that the property continues to be used for industrial or commercial purposes justifying the granting of the tax exemption. The certificate of continuing use shall be filed with the Board of Revision of Taxes on such forms and containing such information as shall be prescribed by it. The Board of Revision of Taxes shall have authority to terminate a tax exemption on the failure of the taxpayer to file an annual certificate of continuing use, or on the failure of the taxpayer to pay delinquent taxes, charges, fees, rents or claims, or to comply with his agreement to pay, or on its own determination that the property has ceased to be used for industrial or commercial purposes justifying the granting of an exemption. 203

            (.a)   Any person granted a tax exemption prior to July 1, 1983, shall be subject to the requirement of filing an annual certificate of continuing use as provided above. However, any tax exemption granted prior to said date shall not be terminated provided that the use, for which the exemption was granted, continues and the person receiving the tax exemption has paid delinquent taxes, charges, fees, rents or claims and is in compliance with any agreement to pay which he may have entered into pursuant hereto. 204

 

Notes

193	Added, 1978 Ordinances, p. 48; amended, 1983 Ordinances, p. 1270; amended, 1990 Ordinances, p. 24. Section 2 of the Ordinance provides: "This Ordinance shall be retroactive to August 10, 1988; provided, however, that any property for which exemption was granted in whole or in part prior to August 10, 1988 pursuant to any provision repealed by this Ordinance shall continue to be governed in its entirety by all the provisions repealed herein as they were originally enacted." Enrolled bill numbered this as Section 19-1303(3); renumbered by Code editor.
194	"Local Economic Revitalization Tax Assistance Act", 1977, December 1, P.L. 237, No. 76, 72 P.S. §§ 4722 et seq.
195	Amended, 1988 Ordinances, p. 736.
196	Added, 1987 Ordinances, p. 302; amended, 1987 Ordinances, p. 1227; amended, Bill No. 200573 (approved January 20, 2021).
197	Amended, 1990 Ordinances, p. 741 (effective January 1, 1992); amended, Bill No. 000225 (approved October 4, 2000). Section 2 of Bill No. 000225 reads as follows: "Effective Date; Application. This Ordinance shall take effect immediately and shall apply only to exemptions for which application is made to the Board of Revision of Taxes on or after such effective date." Amended, Bill No. 200653 (approved January 27, 2021).
198	Added, 1987 Ordinances, p. 302; amended, 1987 Ordinances, p. 1227; amended, Bill No. 200573 (approved January 20, 2021).
199	Renumbered, 1987 Ordinances, p. 302.
200	Renumbered, 1987 Ordinances, p. 302.
201	Renumbered, 1987 Ordinances, p. 302.
202	Added, 1983 Ordinances, p. 1270; amended, 1988 Ordinances, p. 736; amended, 1990 Ordinances, p. 24.
203	Amended, 1987 Ordinances, p. 1227.
204	An older edition of the Code inadvertently included an obsolete subsection after this subsection; deleted by Code editor.