HB 1446 — An Act authorizing local taxing authorities to provide for tax exemptions for improvements and redevelopment of certain underutilized property ; establishing the Economic Development and Mixed-Use Redevelopment Advisory Committee within the State Planning Board; and conferring powers and imposing duties on the Department of Community and Economic Development.

PRINTER'S NO.    1691

                   THE GENERAL ASSEMBLY OF PENNSYLVANIA



                       HOUSE BILL
                       No. 1446
                                              Session of
                                                2025

     INTRODUCED BY SIEGEL, SCHLOSSBERG, KHAN, GIRAL, SANCHEZ, KUZMA,
        KINKEAD, DONAHUE, HILL-EVANS AND BOROWSKI, MAY 12, 2025

     REFERRED TO COMMITTEE ON LOCAL GOVERNMENT, MAY 13, 2025


                                   AN ACT
 1   Authorizing local taxing authorities to provide for tax
 2      exemptions for improvements and redevelopment of shopping
 3      malls; establishing the Economic Development and Mixed-Use
 4      Redevelopment Advisory Committee within the State Planning
 5      Board; and conferring powers and imposing duties on the
 6      Department of Community and Economic Development.
 7      The General Assembly of the Commonwealth of Pennsylvania
 8   hereby enacts as follows:
 9   Section 1.   Short title.
10      This act shall be known and may be cited as the Economic
11   Development and Mixed-Use Redevelopment of Shopping Malls Act.
12   Section 2.   Findings and declaration of policy.
13      It is determined and declared as a matter of legislative
14   finding that there exists in this Commonwealth a number of
15   underutilized shopping malls which provide an economic liability
16   to the communities in which they sit. It is in the public
17   interest to promote redevelopment of these large parcels and
18   return them to function in accordance with sound and approved
19   plans for their redevelopment that will promote public safety,
20   convenience and welfare.
 1   Section 3.    Definitions.
 2      The following words and phrases when used in this act shall
 3   have the meanings given to them in this section unless the
 4   context clearly indicates otherwise:
 5      "Attainable housing."      Any of the following:
 6          (1)    A single-family residence that is subject to home
 7      attainable deed restrictions and occupied by an individual or
 8      family whose income is not more than 60% of the area median
 9      gross income.
10          (2)    A multiunit residential dwelling where at least a
11      percentage, as defined by the municipality, of the
12      residential units are:
13                 (i)    rent-restricted; and
14                 (ii)    occupied by an individual or family whose
15          income is not more than 60% of area median income.
16      "Board."     The State Planning Board established by the act of
17   April 9, 1929 (P.L.177, No.175), known as The Administrative
18   Code of 1929.
19      "Committee."      The Economic Development and Mixed-Use
20   Redevelopment Advisory Committee established by the board under
21   section 4.
22      "Department."      The Department of Community and Economic
23   Development of the Commonwealth.
24      "Developer."      A taxpayer redeveloping a shopping mall for
25   economic development and mixed-use redevelopment purposes.
26      "Economic development."      Creating the conditions for economic
27   growth and improved quality of life by expanding the capacity of
28   individuals, businesses and communities to maximize the use of
29   their talents and skills to support innovation, job creation and
30   private investment.

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 1      "Economic development and mixed-use redevelopment."    An
 2   urban, suburban, village development or single building that
 3   combines residential, commercial, cultural, institutional or
 4   industrial uses to provide efficiency for the community in terms
 5   of space, transportation and economic development.
 6      "Local taxing authority."   A county, municipal corporation,
 7   institution district or school district having authority to levy
 8   real estate taxes.
 9      "Municipal corporation."    A city, borough, incorporated town
10   or township.
11      "Project agreement."   An agreement between a developer and a
12   local taxing authority stating the terms and conditions of the
13   redevelopment of a shopping mall authorized by the local taxing
14   authority for a tax exemption or special tax provision under
15   section 5.
16      "Property maintenance code."    A municipal ordinance that
17   regulates the maintenance or development of real property. The
18   term includes a building code, zoning code, housing code and
19   public safety code.
20      "Real estate tax."   A tax on a homestead imposed or
21   authorized to be imposed by a local taxing authority.
22      "Redevelopment."   Repair, construction or reconstruction,
23   including alterations and additions, having the effect of
24   rehabilitating a shopping mall so that the shopping mall attains
25   higher standards of safety, health, economic use or amenity or
26   is brought into compliance with laws, ordinances or regulations
27   governing safety, health, economic use or amenity standards. The
28   term shall not include ordinary upkeep and maintenance.
29      "Serious violation."   A violation of a State law or a
30   property maintenance code that poses an immediate imminent

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 1   threat to the health and safety of a dwelling occupant,
 2   occupants in surrounding structures or passersby.
 3      "Shopping mall."       A large building or series of connected
 4   buildings containing a variety of stores for the purpose of
 5   retail, food service or recreation. The term includes shopping
 6   plazas, shopping centers and mini malls.
 7      "Special tax provision."       The refund or forgiveness of a
 8   portion of a taxpayer's real estate tax liability as provided by
 9   this act.
10   Section 4.     Economic Development and Mixed-Use Redevelopment
11                  Advisory Committee.
12      (a)   Establishment.--The board shall establish the Economic
13   Development and Mixed-Use Redevelopment Advisory Committee for
14   the purpose of providing municipal corporations with guidance
15   and best practices for the redevelopment of shopping malls into
16   attainable housing and other mixed-use spaces for the benefit of
17   the community.
18      (b)   Composition.--
19            (1)   The committee shall be composed of members with
20      expertise in areas, including:
21                  (i)    Real estate development.
22                  (ii)    Municipal planning.
23                  (iii)    Economic development.
24                  (iv)    Land use planning.
25            (2)   The committee shall include a member of a Statewide
26      trade association of real estate professionals involved in
27      all aspects of the residential and commercial real estate
28      industry.
29      (c)   Guidelines.--The committee shall draft best practices
30   guidelines for the redevelopment of shopping malls based on

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 1   national standards and models. The guidelines shall be posted on
 2   the department's publicly accessible Internet website within six
 3   months of the effective date of this subsection.
 4   Section 5.     Authority to provide special tax provisions.
 5      (a)   Construction.--This act shall be construed to authorize
 6   local taxing authorities to provide special tax provisions
 7   related to an increase in the value of real estate resulting
 8   from the redevelopment of shopping malls within the boundaries
 9   of the local taxing authority, implementing section 2(b)(iii) of
10   Article VIII of the Constitution of Pennsylvania.
11      (b)   Approval required.--A tax exemption or special tax
12   provision authorized under this act is not enforceable until the
13   governing body of any one local taxing authority with
14   jurisdiction to levy real estate taxes on a property has
15   approved an ordinance or resolution adopting the tax exemption
16   or special tax provision. Other local taxing authorities may
17   approve a tax exemption or special tax provision subsequently.
18      (c)   Notice.--
19            (1)   Upon adoption of an ordinance or resolution adopting
20      the tax exemption or special tax provision under subsection
21      (a), each local taxing authority must post a notice of the
22      approval in a newspaper of general circulation in the area. A
23      local taxing authority may also post the notice on its
24      publicly accessible Internet website, if the local taxing
25      authority possesses a publicly accessible Internet website.
26            (2)   If multiple local taxing authorities have mutual
27      jurisdiction to levy real estate taxes on a property, a joint
28      notice of implementation of the tax exemption or special tax
29      provision must be published in a newspaper of general
30      circulation in the area upon adoption by each local taxing

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 1      authority with mutual jurisdiction to levy real estate taxes
 2      on the property and each local taxing authority must post a
 3      notice of the adoption on its publicly accessible Internet
 4      website, if the local taxing authority possesses a publicly
 5      accessible Internet website.
 6   Section 6.     Exemption schedule.
 7      (a)   Tax exemption on assessment.--A local taxing authority
 8   granting a tax exemption under this act may provide for a tax
 9   exemption on the assessment attributable to the actual cost of
10   the redevelopment of shopping malls or up to a maximum cost
11   uniformly established by the municipal corporation. The maximum
12   cost must uniformly apply within the local taxing authority's
13   jurisdiction.
14      (b)   Schedule.--Notwithstanding if an assessment eligible for
15   exemption is based upon actual cost or a maximum cost, the
16   actual amount of taxes exempt must be in accordance with at
17   least one of the following schedules, as determined by the local
18   taxing authority:
19            (1)   For the first 10 years, 100% of the eligible
20      assessment is exempt for economic development and mixed-use
21      redevelopment.
22            (2)   For any economic development and mixed-use
23      redevelopment that is approved by the municipal corporation
24      in which the shopping mall is located, 100% of the eligible
25      assessment shall be exempt for an additional two years if at
26      least one of the following criteria is met to the
27      satisfaction of and by a date established by the local taxing
28      authority, and 100% of the eligible assessment shall be
29      exempt for an additional five years if at least two of the
30      following criteria are met to the satisfaction of and by a

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 1      date established by the local taxing authority:
 2                  (i)    A minimum amount of attainable housing as
 3            defined and determined by the local taxing authority
 4            granting the exemption in consultation with the local
 5            planning authority.
 6                  (ii)    Improved energy efficiency.
 7                  (iii)    Installation of a renewable energy system that
 8            provides electricity for 50% of the average electricity
 9            needs for the economic development and mixed-use
10            redevelopment.
11                  (iv)    Creation of greener or open space.
12                  (v)    Creation of lifestyle improvement projects,
13            including outdoor recreation space, walking paths,
14            bicycle paths or farmers markets.
15                  (vi)    Installation of charging stations for electric
16            vehicles.
17                  (vii)    Access to public transit.
18                  (viii)    The redevelopment of the shopping mall is
19            subject to a project labor agreement.
20      (c)   Sale or exchange.--A tax exemption authorized by an
21   ordinance or resolution adopted under this act is specific to
22   real property of the shopping mall and shall not terminate upon
23   the sale or exchange of the property.
24      (d)   Estimate.--A local taxing authority must provide upon
25   request and within 30 days an estimate of the amount of
26   assessment exempted for each eligible property based on the
27   exemption schedule under subsection (b).
28      (e)   Repayment.--
29            (1)   A local taxing authority shall receive a return of
30      the local taxing authority's proportional share of taxes

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 1      exempt under this act if, within five years following the
 2      redevelopment of the shopping mall, the following occur:
 3                  (i)    a serious violation of State law or a property
 4            maintenance code exists on the property and the owner has
 5            taken no substantial steps to correct the violation
 6            within six months following notification of the violation
 7            and for which fines or other penalties or a judgment to
 8            abate or correct were imposed by a magisterial district
 9            judge at law or in equity, not subject to appellate
10            review, or imposed by a court of common pleas; or
11                  (ii)   the developer is subject to a municipal permit
12            denial under 53 Pa.C.S. Ch. 61 (relating to neighborhood
13            blight reclamation and revitalization) in connection with
14            the redevelopment of the shopping mall.
15            (2)   At the time a project agreement is executed, if the
16      developer has not completed each requirement for exemption
17      under section 8(a) or is ineligible under section 8(b) or
18      (c), the local taxing authority shall file a lien against the
19      tax-exempt property at the rate of the estimated amount of
20      assessment under subsection (d). The lien shall be satisfied
21      by the local taxing authority at the end of the fifth year
22      following the completion of the redevelopment if there have
23      been no serious violations against the property that have not
24      been corrected to the satisfaction of the local taxing
25      authority. The lien on the property remains under subsection
26      (c) upon the sale or exchange of the shopping mall.
27   Section 7.     Exemption incentives procedure.
28      (a)   Notification.--A developer desiring tax exemption for
29   the redeveloped property as authorized by an ordinance or
30   resolution adopted under this act must notify the local taxing

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 1   authority granting the exemption in writing on an application
 2   form provided by the local taxing authority, which must be
 3   submitted at the time the developer secures the building permit
 4   or, if no building permit or other notification is required for
 5   the redevelopment of the property, at the time the developer
 6   commences construction. The application must include the
 7   following information:
 8          (1)   A notarized statement of tax obligations, signed by
 9      the applicant and the local taxing authority.
10          (2)   An outline of specifications for the redevelopment
11      of the shopping mall indicating, with as much specificity as
12      practicable, the materials to be used for exterior and
13      interior finishes.
14          (3)   An itemized cost estimate for the redevelopment of
15      the shopping mall. The itemization must:
16                (i)    be on contractor letterhead; and
17                (ii)    indicate the property address of the
18          redevelopment project.
19          (4)   A preliminary architectural drawing or blueprint for
20      the redevelopment.
21          (5)   A recent appraisal of the property, if available.
22          (6)   An applicable building permit application or
23      building permit.
24          (7)   An income and expense report for the shopping mall,
25      which may be submitted directly to the county assessment
26      office in order to protect the confidentiality of the
27      information.
28          (8)   The final decision of the zoning authority or other
29      regulatory agency granting relief, if applicable.
30          (9)   The signature of the applicant and the date of

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 1      signing.
 2            (10)    Proof of a project labor agreement for the
 3      redevelopment, if applicable.
 4      (b)     Estimate.--The amount of assessment deemed eligible for
 5   tax exemption under subsection (c) shall be available for public
 6   inspection and copying so that a subsequent purchaser may be
 7   informed of the amount of taxes to be paid after the exemption
 8   expires.
 9      (c)     County assessment office.--
10            (1)    A copy of the application submitted under subsection
11      (a) shall be forwarded to the county assessment office. After
12      completion of the redevelopment of the shopping mall, the
13      county assessment office shall:
14                   (i)    Separately assess the redevelopment and
15            calculate the amounts of the assessment eligible for tax
16            exemption in accordance with the limits established by
17            the local taxing authorities.
18                   (ii)    Notify the developer and the local taxing
19            authorities of the reassessment and amounts of the
20            assessment eligible for exemption.
21            (2)    Appeals from a reassessment and the amounts eligible
22      for the exemption may be made by the developer or the local
23      taxing authorities.
24      (d)     Amendment of ordinance or resolution.--The cost of
25   redevelopment to be exempt and the schedule of taxes exempt that
26   exist at the time of the initial request for tax exemption must
27   apply to the exemption request. A subsequent amendment to the
28   ordinance or resolution does not apply to a request initiated
29   prior to adoption of the amendment.
30   Section 8.      Eligibility requirements.

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 1      (a)   Compliance.--The completed redevelopment must:
 2            (1)   Conform to zoning ordinance requirements.
 3            (2)   Correct any municipal code violation.
 4      (b)   Ineligibility.--A property is deemed ineligible for tax
 5   exemption under section 7(a) if any of the following apply:
 6            (1)   The property receives other property tax abatement
 7      or exemption incentives for new construction or improvement.
 8            (2)   The property receives tax relief through a State
 9      program.
10            (3)   The property owner or developer is delinquent on
11      property taxes related to the subject property, unless the
12      delinquent taxes are paid prior to redevelopment, or payment
13      of delinquent taxes has been arranged with the local taxing
14      authority in accordance with an installment plan.
15            (4)   The property owner has a legal or equitable interest
16      in other property for which taxes are delinquent, unless the
17      delinquent taxes are paid prior to redevelopment, or payment
18      of delinquent taxes has been arranged with the local taxing
19      authority in accordance with an installment plan.
20            (5)   The property owner has a legal or equitable interest
21      in other property within the boundaries of the municipal
22      corporation for which there exists a serious violation that
23      has not been remedied prior to filing the application under
24      section 7.
25            (6)   Construction or other improvements for the
26      redevelopment of the shopping mall has commenced prior to
27      filing an application under section 7.
28      (c)   Prohibitions.--For the period of time that a property
29   receives tax exemption under this act, a purchase or sale of the
30   property or a portion of the property may not be structured to

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 1   exclude or exempt the transaction from a realty transfer tax due
 2   to a taxing authority that would not be excluded or exempt,
 3   except for the following:
 4          (1)   A sheriff sale or tax claim bureau sale.
 5          (2)   A corrective deed.
 6          (3)   A transfer by a mortgagor to the holder of a bona
 7      fide mortgage in default in lieu of a foreclosure.
 8          (4)   A transfer to a judicial sale in which the
 9      successful bidder is the bona fide holder of a mortgage.
10          (5)   A transaction excluded from the realty transfer tax
11      under Article XI-C of the act of March 4, 1971 (P.L.6, No.2),
12      known as the Tax Reform Code of 1971.
13   Section 9.   Effective date.
14      This act shall take effect in 60 days.




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