HB 1094 — An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, providing for historic homeownership preservation incentive tax credit; imposing duties on the Department of Community and Economic Development and the Pennsylvania Historical and Museum Commission; and establishing the Historic Homeowner Preservation Tax Credit Administration Fund.

PRINTER'S NO.   1189

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 1094
                                               Session of
                                                 2025

     INTRODUCED BY CIRESI, JAMES, SANCHEZ, WAXMAN, HILL-EVANS,
        MADDEN, MAYES, GIRAL, NEILSON, PROBST, CEPEDA-FREYTIZ,
        MALAGARI, HOWARD, D. WILLIAMS, BRENNAN, STEELE, SAPPEY,
        BOROWSKI AND GREEN, MARCH 31, 2025

     REFERRED TO COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT,
        MARCH 31, 2025


                                    AN ACT
 1   Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
 2      act relating to tax reform and State taxation by codifying
 3      and enumerating certain subjects of taxation and imposing
 4      taxes thereon; providing procedures for the payment,
 5      collection, administration and enforcement thereof; providing
 6      for tax credits in certain cases; conferring powers and
 7      imposing duties upon the Department of Revenue, certain
 8      employers, fiduciaries, individuals, persons, corporations
 9      and other entities; prescribing crimes, offenses and
10      penalties," providing for historic homeownership preservation
11      incentive tax credit; imposing duties on the Department of
12      Community and Economic Development and the Pennsylvania
13      Historical and Museum Commission; and establishing the
14      Historic Homeowner Preservation Tax Credit Administration
15      Fund.
16      The General Assembly of the Commonwealth of Pennsylvania
17   hereby enacts as follows:
18      Section 1.    The act of March 4, 1971 (P.L.6, No.2), known as
19   the Tax Reform Code of 1971, is amended by adding an article to
20   read:
21                             ARTICLE XVII-H.1
22       HISTORIC HOMEOWNERSHIP PRESERVATION INCENTIVE TAX CREDIT
23   Section 1701-H.1.    Scope of article.
 1      This article relates to the historic homeownership
 2   preservation incentive tax credit.
 3   Section 1702-H.1.     Definitions.
 4      The following words and phrases when used in this article
 5   shall have the meanings given to them in this section unless the
 6   context clearly indicates otherwise:
 7      "Certified historic property."        A property located within
 8   this Commonwealth that is:
 9          (1)   listed individually in the National Register of
10      Historic Places;
11          (2)   located in a historic district listed in the
12      National Register of Historic Places and identified as a
13      contributing building in the National Register of Historic
14      Places or as determined by the commission;
15          (3)   individually designated as a historic property by
16      local ordinance; or
17          (4)   located in a historic district that is:
18                (i)    certified by the commission under the act of
19          June 13, 1961 (P.L.282, No.167), entitled "An act
20          authorizing counties, cities, boroughs, incorporated
21          towns and townships to create historic districts within
22          their geographic boundaries; providing for the
23          appointment of Boards of Historical Architectural Review;
24          empowering governing bodies of political subdivisions to
25          protect the distinctive historical character of these
26          districts and to regulate the erection, reconstruction,
27          alteration, restoration, demolition or razing of
28          buildings within the historic districts";
29                (ii)    established by a municipality that has adopted
30          a home rule charter; or

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 1                 (iii)    established by a municipality under the act of
 2          July 31, 1968 (P.L.805, No.247), known as the
 3          Pennsylvania Municipalities Planning Code.
 4      "Commission."      The Pennsylvania Historical and Museum
 5   Commission.
 6      "Completed project."      The completion of the rehabilitation of
 7   a qualified historic home in accordance with a qualified
 8   rehabilitation plan. If the property is unoccupied, the owner
 9   shall obtain an occupancy certificate prior to completing the
10   project.
11      "Department."      The Department of Community and Economic
12   Development of the Commonwealth.
13      "Internal Revenue Code."      26 U.S.C. § 1 et seq. (Internal
14   Revenue Code of 1986), as amended.
15      "Qualified census tract."      A federally qualified census tract
16   or area of chronic economic distress that is identified by the
17   department and is:
18          (1)     at 100% or below the State family median income
19      level; or
20          (2)     designated as a qualified opportunity zone under 26
21      U.S.C. § 1400Z-1 (relating to designation).
22      "Qualified expenditures."      As follows:
23          (1)     The costs and expenses that:
24                 (i)    are properly chargeable to a capital account;
25                 (ii)    are incurred by a qualified taxpayer in the
26          rehabilitation of a qualified historic home pursuant to a
27          qualified rehabilitation plan; and
28                 (iii)    adhere to the guidelines for eligible
29          rehabilitation expenditures developed under section 1705-
30          H.1.

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 1        (2)   The term does not include:
 2              (i)    The cost of acquiring a building or interest in
 3        a building.
 4              (ii)    An expenditure attributable to the enlargement
 5        of an existing building.
 6              (iii)    Expenditures related to interior improvements
 7        or maintenance, except as necessary to stabilize or
 8        structurally support the qualified historic home's
 9        exteriors.
10        (3)   The commission may develop guidelines on the types
11    of costs and expenses that are appropriately determined to be
12    qualified expenditures.
13    "Qualified historic home."     As follows:
14        (1)   A certified historic property or portion of the
15    property of an applicant that is:
16              (i)    located in a qualified census tract;
17              (ii)    owned by the applicant; and
18              (iii)    being used, or within a reasonable period will
19        be used, by the applicant as the applicant's principal
20        residence.
21        (2)   The following apply to the property described under
22    paragraph (1):
23              (i)    The property may consist of part of a multiple
24        dwelling or multiple purpose building or series of
25        buildings.
26              (ii)    If only a portion of a building is used as the
27        principal residence, only those qualified expenditures
28        that are properly allocable to that portion shall be
29        eligible under this article to apply for tax credits
30        calculated at the percentage available to owner-

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 1            occupants.
 2      "Qualified rehabilitation plan."        A plan to substantially
 3   rehabilitate a qualified historic home that is approved by the
 4   commission as being consistent with the Standards for the
 5   Treatment of Historic Properties as adopted by the United States
 6   Secretary of the Interior. A plan shall be treated as
 7   substantially rehabilitated if qualified expenditures total
 8   $5,000 or more.
 9      "Qualified tax liability."       Tax liability imposed on a
10   taxpayer under Article III. The term does not include any tax
11   withheld by an employer from an employee under Article III.
12      "Qualified taxpayer."       An individual who:
13            (1)   is subject to a tax imposed under Article III; and
14            (2)   owns a qualified historic home.
15   Section 1703-H.1.       Tax credit certificates.
16      (a)   Application.--
17            (1)   A qualified taxpayer may apply to the department for
18      a tax credit certificate under this section.
19            (2)   The application shall be on the form required by the
20      department and shall include a qualified rehabilitation plan.
21            (3)   The department shall establish an application
22      processing fee. The following apply:
23                  (i)    The fee structure shall be tiered based on the
24            amount of tax credits requested.
25                  (ii)   In no case shall the fee exceed $100.
26            (4)   The proceeds of the fee under paragraph (3) shall be
27      deposited into the Historic Homeowner Preservation Tax Credit
28      Administration Fund, which is established in the State
29      Treasury. The money in the Historic Homeowner Preservation
30      Tax Credit Administration Fund shall be appropriated on a

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 1    continuing basis to the department and used by the commission
 2    and the department to offset the costs of the review of tax
 3    credit applications and awarding of tax credit certificates.
 4          (5)   The department shall begin accepting applications
 5    for credit certificates on June 1 and close the initial
 6    application period on June 30.
 7    (b)   Review, recommendation and approval.--
 8          (1)   The department shall forward applications received
 9    under this section to the commission for review.
10          (2)   The commission shall:
11                (i)    Review the proposed rehabilitation plan in each
12          application.
13                (ii)    Verify that the building is a qualified
14          historic home.
15                (iii)    By December 1, provide the department with a
16          list of eligible projects.
17          (3)   The department shall allocate the credits and
18    release a list of allocated projects within 15 business days
19    of the receipt of the list under paragraph (2)(iii).
20    Applicants with approved allocations shall be provided with
21    an award letter.
22          (4)   Any amount of tax credit certificates up to the
23    annual program limit of $3,000,000 not awarded within the
24    initial application period shall be available on a first-
25    come, first-served basis through a process determined by the
26    department.
27          (5)   The applicant shall notify the commission of the
28    completed project and shall submit proof of qualified
29    expenditures within three years of the issuance of the award
30    letter by the department under paragraph (3). The commission

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 1      shall notify the department of verification of a completed
 2      project within 30 days and shall notify the department of the
 3      amount of qualified expenditures incurred by the taxpayer in
 4      connection with the completed project.
 5            (6)   If the department has approved the application and
 6      received notification of a completed project, it shall issue
 7      the qualified taxpayer a tax credit certificate within 45
 8      days of the receipt of an approved, completed project. A tax
 9      credit certificate issued under this section may not exceed
10      20% of qualified expenditures determined by the commission to
11      have been incurred by the qualified taxpayer in connection
12      with the completed project.
13            (7)   In granting tax credit certificates under this
14      article, the department may not grant more than $20,000 in
15      tax credit certificates to a single qualified taxpayer or
16      qualified taxpayers in a single household in any fiscal year.
17   Section 1704-H.1.    Claiming tax credit.
18      Upon presenting a tax credit certificate to the Department of
19   Revenue, a qualified taxpayer may claim a tax credit against the
20   qualified tax liability of the qualified taxpayer for the
21   taxable year in which the project was completed. If the tax
22   credit exceeds the taxpayer's tax liability, the Department of
23   Revenue may issue a refund under the procedures specified in
24   section 346.
25   Section 1705-H.1.    Administration.
26      (a)   Guidelines.--The department, the commission and the
27   Department of Revenue shall jointly develop written guidelines
28   for the implementation of the provisions of this article.
29      (b)   Forms.--The department, in conjunction with the
30   commission, shall develop the application forms required under

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 1   section 1703-H.1(a)(2).
 2   Section 1706-H.1.    Annual report to General Assembly.
 3      (a)   Submittal.--By October 1, 2027, and October 1 of each
 4   year thereafter, the department shall submit a report on the tax
 5   credit under this article to:
 6            (1)   The chairperson and minority chairperson of the
 7      Appropriations Committee of the Senate.
 8            (2)   The chairperson and minority chairperson of the
 9      Appropriations Committee of the House of Representatives.
10            (3)   The chairperson and minority chairperson of the
11      Finance Committee of the Senate.
12            (4)   The chairperson and minority chairperson of the
13      Finance Committee of the House of Representatives.
14            (5)   The chairperson and minority chairperson of the
15      Urban Affairs and Housing Committee of the Senate.
16            (6)   The chairperson and the minority chairperson of the
17      Housing and Community Development Committee of the House of
18      Representatives.
19      (b)   Contents.--The report under this section must include:
20            (1)   The list of completed projects that have been
21      awarded tax credits under this article.
22            (2)   The amount of tax credits under this article
23      received by each completed project.
24            (3)   Total project costs and the amount of private
25      investment in each completed project.
26            (4)   The total number of completed projects placed into
27      service in the past year that were vacant for at least 12
28      months prior to commencement of rehabilitation work.
29            (5)   The total number of completed projects placed into
30      service in the past year that had not paid property taxes for

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 1      at least 12 months prior to the commencement of
 2      rehabilitation work.
 3      (c)   Public information.--Notwithstanding any law providing
 4   for the confidentiality of tax records, the information in the
 5   report under this section shall be public information and shall
 6   be posted on the publicly accessible Internet website of the
 7   department.
 8      (d)   Review of tax credit program.--The department, in
 9   cooperation with the commission, shall undertake a review of the
10   tax credit program under this article to determine the
11   effectiveness of the program in preserving and rehabilitating
12   the Commonwealth's historic homes and the impact these efforts
13   have had on the stimulation of investment in this Commonwealth.
14   The results of the review shall be included in the annual report
15   due October 1, 2027.
16   Section 1707-H.1.   Application of Internal Revenue Code.
17      The provisions of 26 U.S.C. § 47 (relating to rehabilitation
18   credit) and the regulations promulgated regarding those
19   provisions shall apply to the Department of Revenue's
20   interpretation and administration of the credit provided under
21   this article without regard to ratably allocating the credit
22   over a five-year period as required by 26 U.S.C. § 47(a).
23   References to the Internal Revenue Code shall mean the sections
24   of the Internal Revenue Code as existing on any date of
25   interpretation of this article, except that if those sections of
26   the Internal Revenue Code referenced in this article are
27   repealed or terminated, references to the Internal Revenue Code
28   shall mean those sections last having full force and effect
29   without regard to ratably allocating the credit over a five-year
30   period as required by 26 U.S.C. § 47(a). If after repeal or

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 1   termination the Internal Revenue Code sections are revised or
 2   reenacted, references in this article to Internal Revenue Code
 3   sections shall mean those revised or reenacted sections.
 4   Section 1708-H.1.   Limitation.
 5      Taxpayers shall not be entitled to apply for tax credits
 6   under this article after February 1, 2035.
 7   Section 1709-H.1.   Tax credit administration.
 8      The tax credit provided for under this article is subject to
 9   the provisions of Article XVII-A.1.
10   Section 1710-H.1.   Administrative costs.
11      (a)   Commission.--The commission may use no more than 3% of
12   money allocated for the tax credit program under this article
13   for administrative costs associated with the tax credit program.
14      (b)   Department.--The department may use no more than 3% of
15   money allocated for the tax credit program under this article
16   for administrative costs associated with the tax credit program.
17      Section 2.   This act shall take effect in 180 days.




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